The rapid growth of technology has led to advances in the supply chain and, in particular, the digital supply chain. As the century unfolds, we are seeing a more joined up supply chain, with efficient, robust and technologically advanced systems integration.
Here, we explore the benefits that digitalisation, bolstered by smart usage of big data and data analytics, is bringing to the supply chain in terms of increased profitability and reduced waste.
The supply chain exists to streamline the processes involved in procurement and as a way of increasing efficiencies business-wide. Not only will efficiency remain at the heart of the supply chain, but with digitalisation enabling high levels of connectivity, we’ll see greater transparency and collaboration across different departments.
In addition to ensuring the security of valuable information assets, companies also have the challenge of achieving an appropriate level of sustainability, while pioneering and advancing the digital supply chain overall.
In looking at supply chain management as it currently stands, Page Executive identified five trends:
Digitalisation will drive increased efficiency
Supply chain managers who are willing to invest would be wise to look at IT integration, an area where 70% of managers are planning significant investment with the rise of newer technologies and a drive to modernisation.
IT integration – an area where 70% of managers are planning significant investment.
This investment will create jobs and assist the faster adoption of web-based processes in the supply chain. An example is real-time technology, where customers and employees can be confident that stock levels displayed on their screens reflect reality in the warehouse at any given time.
With this greater supply chain visibility, managers can now monitor how different processes are performing at any time, from sales to logistics, leading to better informed inter-departmental transactions.
Big data analytics will improve profitability and save time
Big data and predictive analytics will provide networks with greater data accuracy, clarity and the ability to work cohesively in order to achieve improved contextual intelligence over various individual networks.
One such example is forecasting demand: retailers in Russia found that book sales went up in cold weather. Some online booksellers such as Ozun, therefore, increased the number of book recommendations whenever the temperature dropped.
Outstanding accuracy and the ability to react at speed will prove useful where business models are based on short product lifecycles. As Accenture found, 36% of companies agree on the need for greater IT integration across the supply chain as mentioned above, but 41% of companies said big data meant faster and more effective reaction time to supply chain issues (source: Global Operations Megatrends Study on Big Data in Supply Chain).
The proliferation of the Internet of Things (IoT) will mean greater interconnectivity and sophistication leading to intelligent algorithms. To further enhance supply chain performance, these algorithms will ‘learn’ human planning behaviours and be able to predict the decisions that will need to be made.
Mobility will become the norm
As the power of big data is applied to increasing efficiency and saving time, mobility will become standard. Infrastructure improvements will continue to advance supply chain workflows. Supply chain managers will be released from their desktops and laptops as they switch to mobile devices and tablets.
Mobility will become standard. Supply chain managers will be released from their desktops and laptops as they switch to mobile devices and tablets.
Supply chain updating in real time requires managers and their teams to have easy access to core systems. In order to achieve true mobility, companies and managers alike must understand the importance of IT integration and ensure they hire people with specialised knowledge in the area, with a particular emphasis on security.
In collaboration with their mobile business solution providers, supply chain managers will need to determine which functions and processes are prime candidates for mobilisation.
With many companies and supply chain managers still reliant on older systems, the transformation to mobile working will take time to implement. There is likely to be an incremental cost, too, as managers undergo training and budgets are reassessed.
There will be a shift in hiring talent
As technology continues to advance, the type of talent being hired will change as skill gaps become apparent. Traditional training methods will no longer be relevant, creating demand for new training methods and new roles to be filled.
For managers, this change will mean seeking out people who are comfortable with modern systems, with a knowledge of big data and deep analytics and experience with new technologies.
Soft skills are equally important given the degree of adaptability required. Skills such as agility and being a fast learner are essential for businesses adopting change and they will look for talent with these skills in the future. The challenge will be finding that talent.
While globalisation has widened the pool of talent, frequent technological change creates a need for highly specialised skills.
While globalisation has widened the pool of talent, frequent technological change creates a need for highly specialised skills.
We’ll start to take drones seriously
Drone technology is still in its infancy. However, many large corporations are testing drone technology and starting to take it seriously. The prospect of reducing their environmental impact, lowering costs and accelerating the supply chain has great appeal. This revolution will create new positions and trigger the search for newer, more diverse talent.
Big players like Amazon, which recently partnered with the British government to test small delivery drones, have been pioneers in this arena over the last year. Nevertheless, there is huge untapped potential to use drones in warehouses to pick and move products.
Using drones to deliver products to the consumer is still a long way off. However, as capabilities improve daily (for example, better battery life and smart technology), drones are becoming a more commercially feasible option. It is reassuring that companies like UPS are testing drones for the emergency delivery of medical supplies.
In conclusion
With its ability to cut costs and timescales, digitalisation is the answer to many supply chain pain points. Digitalisation will invariably heighten efficiency as systems are updated and integrated, making life easier for everyone involved in the supply chain.
But the most exciting development will be drones. While far from perfect, drones open our eyes to new possibilities and the direction that whole industries from retail to manufacturing might take. A wave of new talent will need to be hired to understand and execute these changes and bring supply chain management into 2017.
Key Takeaways
- The supply chain will see an influx in diverse talent and ability to learn new skills
- The smart use of data will help to yield more profit
- Supply chain managers should invest in new technologies, such as real-time technology, to drive modernisation and increase efficiency
