How is Supply Chain Evolving
The Supply Chain Management System (SCMS) incorporates technology for integrating business functions. The COVID-19 pandemic has forced supply chain organizations to focus on increased automation and risk management. SCM leaders are using software tools like Artificial Intelligence (AI) and Advanced Analytics. It helps them dig through data to generate relevant insights for their businesses. They are also looking at systems like Robotic Goods-to-person (G2P) to handle warehousing. This helps them address social distancing needs in warehouses along with increasing productivity.
Dependence on AI and Automation
Artificial Intelligence and Automation are the future of supply chain management. Any decent SCMS has to invest in these technologies. Automation helps to streamline repetitive tasks to improve efficiency and productivity. And AI can assist businesses complete challenging jobs with precision. It allows companies to stay competitive while achieving operational efficiency. Organizations have to incorporate these digital technologies into their regular workflow.
Internet of Things
The Internet of Things (IoT) is a set of interconnected devices used to exchange, monitor and report data. These devices use Wi-Fi networks or data to connect with the primary system. They include tools like sensors, RFID chips and other intelligent devices. IoT devices help track and authenticate product shipments to predict their arrival time. They also assist in monitoring storage conditions of raw materials and finished products.
Focus on Outsourcing
Several businesses are outsourcing functions within their SCMS to logistics vendors. These vendors also use automation tools and technologies for better results. Outsourcing helps them save costs of handling the supply chain vertical of their business. It also improves their ability to fulfil customer demands. Third-party logistics vendors can cope better with changing market conditions without any disruptions.
Focus on Sustainability
The environment is fast becoming the priority for both consumers and businesses. People are increasingly opting for businesses that promise an environment-friendly manufacturing process. Companies are overhauling their SCMS right from sourcing raw materials to final delivery to customers. But they need to do it gradually to prevent the bullwhip effect and disruption in the supply chain. They also need to give time for the organization to adjust to these changes.
Striking a Balance Between Humans and Machines
Automation can lead to more significant time and cost and time efficiencies in the supply chain. It has also meant that machines are replacing people for several mundane and repetitive tasks. At the same time, technology is creating more jobs in gathering and interpreting data. Companies are always looking for a skilled workforce to operate these machines. So employers must always look to impart newer skills to their employees. This will help them get greater responsibilities in the company.
Focus on Customization
Businesses prefer greater customization in their supply chains to suit their customer’s needs. They are segmenting their SCMS and approaching each segment with a different strategy. You can use customization to simplify your manufacturing, ordering, packaging and delivery processes. You can also add special features to give a personalized experience for your customers. Doing so will not only enhance customer satisfaction but also lead to future orders.
Rising Need for Cloud-Based Supply Chain Management
The need for a cloud-based supply chain management system has enhanced further. It offers similar levels of functionality and security to traditional software. But there is greater scope for customization in cloud-based software. It also doesn’t need an on-premise system like its conventional counterpart. With an estimated market size of $ 8.6 billion by 2025, the future of supply chain management is with cloud computing.
Supply chain managers need regular access to real-time and accurate data. Without it, there can be no hope for agility within their business decisions. They need to access, analyze and share information constantly to generate actionable insights. The need for data-driven decision-making is critical in that aspect. Integration within supply chain processes allows for robust demand planning and predictive analytics. It also leads to greater efficiencies both in terms of time and cost.