The real reason supply chain tech ROI falls short

Despite billions invested annually in transportation management systems, warehouse management software, AI platforms, and automation technologies, many supply chain technology implementations still fail to meet expectations. Often, that is not because the technology itself falls short, but because organizations rush into implementation before defining the business strategy the technology is supposed to support.

That was one of the central themes in a recent conversation with Tony Wayda of JBF Consulting. Wayda, principal, client advisory & partnerships with JBF, sat down with Supply Chain Management Review earlier this year at the Gartner Supply Chain Symposium to talk technology implementation, and what works, and doesn’t work, in today’s supply chain.

“The technology is just a tool,” Wayda said. “Don’t think you need a tool when you don’t know what your strategy is.”

Wayda said JBF recently completed a survey examining failed supply chain technology implementations and the reasons companies fail to achieve expected return on investment. According to the findings, roughly 89% of implementations realized less than 76% of projected ROI, while nearly 89% fell short on time, budget, or expected outcomes. It isn’t that the technology isn’t providing value, it’s just not providing the value expected.

Execution lapses

The biggest issue, Wayda said, is often not the software vendor itself, but the gap between vendor selection and implementation execution.

“What we’re seeing is companies that engage us reduce the risk of selecting the wrong product,” Wayda said. “People go to the top right corner of that Gartner Magic Quadrant for all technologies, but that’s not always the best technology for you.”

Wayda described a recurring pattern across implementations: organizations identify a technology category they believe they need such as a TMS, WMS, AI platform, or automation system without first clearly defining the operational problem they are trying to solve.

“So many people go like, ‘Oh, we need a TMS,’” he said. “What do you need the TMS to do? What is the purpose of it? What is your business objective? What problems are you trying to solve?”

That disconnect, Wayda said, frequently leads to companies selecting overly complex or poorly aligned systems that eventually require costly workarounds, reconfiguration, or even replacement.

“If you select your own technology and you’re implementing it and you figure it out too late, you’re going to either rip and replace or you’re going to spend a lot of time figuring out workarounds,” Wayda said. That negates the ROI.

Organizational gaps

The issue extends beyond the selection of the software and includes ancillary considerations.  According to Wayda, many organizations fail to properly account for internal resource allocation, governance, training, and change management before implementation begins.

He noted that many companies require employees to be involved with the implementation project, but also to continue handling their day job. That adds stress and resource allocation concerns.

Wayda said companies often focus heavily on software licensing and systems integrator costs while underestimating the broader organizational lift required to support a successful adoption. Internal IT resources, program management, governance structures, and role-based training are frequently omitted or underfunded in implementation planning.

“The first thing that gets cut all the time is change [management],” Wayda said. “Then the adoption doesn’t happen and then basically you don’t get to ROI.”

Wayda also argued that many implementations become disconnected from the operational business teams once vendor selection is complete. He noted that once the project is handed over to IT, it will get implemented but not necessarily in a way that works for the business.

A reset is underway

A shift seems to be occurring across the supply chain technology market, particularly within warehouse automation and AI deployments. Increasingly, technology providers themselves are encouraging companies to engage consultants and strategy specialists earlier in the process rather than simply purchasing systems based on market positioning or industry hype.

Wayda said some software vendors are beginning to recognize the limits of purely technology-driven implementations.

“They’re good at configuring their software. They’re good at getting their software up and running, but they’re not necessarily good at the change management side,” he said.

One example is role-based training. According to Wayda, many software vendors teach users how to navigate the software but fail to teach them how to use the technology to improve operational performance within their specific roles.

“They teach you how to use the software,” he said. “They don’t teach you how to make the software make you more productive and work for your company.”

The same concerns are now surfacing around artificial intelligence adoption, where many organizations feel pressure from executive leadership to “implement AI” without a clearly defined operational use case.

Wayda said AI can provide meaningful value in areas such as decision support, data analysis, and operational insight generation, but organizations still need strong foundational data governance and clearly defined business objectives before the technology can succeed.

“If you don’t have a strong data governance, master data plan in place, you better get one,” he said. “The cleaner your data is, the better and faster decisions you’re going to make.”

Ultimately, Wayda believes supply chain technology success comes down to organizational discipline rather than software capability.

“Companies that are successful are figuring out what problems AI can solve and how can I work it into my strategy and into my daily business process,” he said. “Those are the ones that are going to be successful.”

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