The Future of Supply Chain: Emerging Technologies You Need to Know
Emerging technologies like AI, IoT, blockchain, etc., are revolutionizing supply chain visibility, efficiency, and resilience. Here’s what’s coming next.
In Brief
The future of supply chain management looks vastly different than the past. Emerging technologies are dramatically transforming processes and operations across procurement, production, and distribution.
Strategic leaders must understand how artificial intelligence, the internet of things, blockchain, and machine learning specifically improve agility, visibility, and efficiencies. Additionally, embracing digital transformation requires new collaborative mindsets and adapting workforce talents.
Staying ahead involves actively scanning the horizon for disruptive innovations such as digital twins and autonomous drones. Today’s article explores the key technical advances revolutionizing supply chains and what steps organizations should take to ensure readiness for industry evolution.
Artificial intelligence assists businesses in tracking inventory levels and demand patterns. AI systems analyze past sales data to forecast future requirements accurately. Predictive analytics help companies order their products in suitable quantities from manufacturers. It prevents stock-outs and reduces storage of excess stock.
AI automates routine supply chain activities. Robots and smart software perform repetitive tasks like picking, packing, shipping, and transportation. AI finds efficiencies by optimizing workflows. It schedules production and routes shipments utilizing real-time traffic and weather data.
AI-powered chatbots and virtual agents answer vendor queries fast. They provide round-the-clock support for procurement professionals and suppliers on pricing, order status or shipment delays.
AI detects anomalies in orders, invoices, or deliveries early on. It flags deviations from standard procedures for human review. This helps managers troubleshoot issues and find solutions rapidly. Overall, AI brings consistency, speed and intelligently handles high volumes across vast supplier networks for businesses.
AI benefits B2B companies by streamlining supply chain processes end-to-end. It frees up resources from repetitive work. Importantly, AI helps businesses, and their vendors make well-informed decisions to operate more productively with fewer errors or delays.
Internet of Things (IoT)
IoT connects physical objects like sensors to the internet, enabling them to collect and exchange data. This allows AI to analyze real-time information from supply chain operations.
Product and Asset Tracking
IoT sensors track inventory, equipment, and shipments continuously. RFID/NFC tags attached to items share identifiers, location, and status wirelessly. AI spot anomalies to optimize workflows and flag issues proactively. This visibility enhances resource allocation and maintenance planning.
Automated Warehouse Management
Drones and AI-assisted robots perform picking, packing and palletizing operations in touchless warehouses. Computer vision guides vehicles to retrieve stock accurately as per orders. AI directs the fleet optimally to improve productivity and reduce costs.
Predictive Maintenance
Sensors in machines and vehicles feed operating parameters to AI models. These analyze usage patterns and predict breakdowns before occurrences. Scheduled servicing based on predictive alerts raises equipment uptime significantly.
Digital Twins and Simulation
Real-time IoT data generates digital replicas of physical operations. AI simulates ‘what-if’ scenarios on these virtual twins to test changes, minimize risks and costs before implementations on actual systems.
When a supplier ships an order, the details automatically enter an immutable record visible to all participating stakeholders. Payments are released promptly after verification of delivery. Disputes are rare, because there are no intermediaries to blur the lines of responsibility.
According to HBR, traceability maximizes throughout the supply chain. Partners track exact locations and conditions of goods in real-time. This ensures quality and prevents theft or spoilage. Customers appreciate full visibility into origins and handling of what they purchase.
To adopt blockchain, companies work with specialized technology providers. Suppliers and buyers install compatible software letting them issue shipments, payments, and inspections on the shared platform. New members easily onboard after validating identities once.
Network effects grow as more participate. Individual businesses reduce risks and expenses coordinating independently. Confidence strengthens among all counterparts accustomed to dealing straightforwardly, efficiently, and openly on blockchain. The innovative system establishes reliable, straightforward processes future-proofing supply chain management for all involved.
Machine Learning
Machine learning impacts supply chain management in important ways. It allows supply chain managers to make better predictions. ML models analyze massive amounts of data from past supply chain operations. They find hidden patterns human minds cannot see.
The models learn from this data. They help forecast demand and plan productions schedules more accurately. Managers gain insights into which products sell best and when. ML also optimizes supply chain networks.
It recommends ideal inventory levels, transport routes, and facility locations to lower costs. According to Hindawi, Supply chain managers can implement ML models in their own operations.
First, they have to collect and organize historic data on sales, inventory, shipping etc. This ‘trains’ the ML model to understand patterns.Next, managers input new data and the model predicts outcomes. Its results help managers make informed logistics decisions for placing orders, allocating resources, and managing unforeseen disruptions.
Regularly feeding updated data maintains the model’s accuracy over time. Managers leverage ML models’ abilities but still oversee crucial duties. By intelligently applying these automated learning systems, businesses future-proof supply chain operations for consistent efficiency and customer satisfaction through tomorrow’s unpredictable changes.
Implementing Digital Transformation in Supply Chains
Implementing successful digital transformation in supply chain operations requires strategic planning, enhancing agility through collaboration, investing in human talent, and staying ahead of technological and methodological trends. Supply chain leaders that take a structured approach to leveraging advanced capabilities can gain tremendous competitive advantages.
Strategic Planning
The first critical step is developing a comprehensive strategic plan for digitally upgrading end-to-end supply chain processes. It entails clearly defining current shortcomings and future objectives, auditing existing procedures and assets to identity digitization opportunities, researching relevant technologies and solutions, building executable roadmaps aligning to overarching corporate goals, and establishing success metrics. Additional vital components include:
Performing cost-benefit analyses to concentrate resources on transformations projected to drive maximum financial returns or other defined strategic value;
Assigning specialized task forces with technical and business expertise to thoroughly evaluate use cases;
Modeling multiple implementation scenarios through proof-of-concept pilot testing;
Cultivating buy-in and budget commitment from leadership stakeholders.
Meticulous planning reduces deployment risks and ensures that technology integrations contribute to clearly defined supply chain objectives in terms of efficiency, visibility, accountability, etc.
Agility and Collaboration
Digital levers should focus on dramatically amplifying organizational agility. Supply chains face innate challenges from siloed functions, complex partner networks and reliance on legacy procedures.
Modern solutions centered on data integrations, cloud-based control towers and decision-making algorithms cultivate previously impossible flexibility, responsiveness, and resilience. You can use the following to achieve more efficiency:
Tightening connections with external suppliers, OEMs, logistics providers and retailers using API data exchanges to enable real-time transparency, risk detection and collaborative resolutions;
Investing in modular architecture emphasizing compartmentalization and loose couplings to isolate downstream disruptions;
Deploying interactive Gantt chart tools for dynamic adjustments of interdependent distribution timelines in fluid situations;
Modeling a breadth of disruption scenarios to create contingency protocols engaging both internal groups and external partners;
Investing in Talent
Transforming supply chains without transforming employee skill sets invites failure. Organizations must become talent incubators through extensive reskilling/upskilling initiatives if they hope to extract full value from bleeding-edge technologies. Several impactful approaches include:
Automating repetitive entry-level jobs to redirect personnel toward value-added analytics and innovation;
Incentivizing interests in high-priority competency domains through tuition reimbursement programs;
Curating video tutorials, online courses and microlearning content to foster self-education;
Subsidizing nanodegrees, workshops, and professional certifications;
Building cross-department rotations to spur understanding of integrated systems vs linear sequences;
Nurturing purposeful internal capabilities to harness and enhance technological functionalities breeds true differentiation. No quantity of technology outweighs human creativity.
Staying Ahead of Trends
Change remains the supply chain’s sole constant. Complacency kills. Best-in-class players perpetually scan horizons for emerging innovations in logistics hardware, protocols and methodologies – then run realistic trial implementations to gauge strategic importance.
Farsighted organizations actively experiment with bleeding-edge robotics, autonomous freight vehicles, automated picking tools and augmented reality teleassistance to evaluate operational impacts.
You can closely track blockchain evolutions across financial settlement, chain of custody documentation, sensor-driven monitoring and more. Make sure you continuously engage analytics solution providers to rapidly pilot cutting-edge forecasting algorithms as they emerge. Consider gradual transitions toward circular economy “reuse and recycle” models and assess necessary operational alterations.
Keeping technological functionality flexible allows smoothly folding high-potential advances into existing environments before rivals. Supply chain transformation is an endless pursuit – not a one-time initiative.
Additional Emerging Technologies
Digital Twins
Digital twins create virtual simulated environments mirroring real-world physical assets and processes. Sophisticated physics engines update digital clone behaviors dynamically based on live data streams from corresponding machinery. Supply chain leaders leverage these cyber representations to safely optimize workings through low-risk virtual testing before costly physical implementations.
Drones
Unmanned autonomous drones promise to revolutionize inventory handling and last-mile transportation. Aerial vehicles access hard-to-reach warehouse locations speedily to lift heavy pallets or deliver small parcels.
Onboard cameras confirm picking accuracy as robot arms gently secure items. Drones will prove integral for rapid delivery in congested urban zones or following natural disasters when roads become unpassable.
Self-Driving Vehicles
Self-driving trucks traveling continuously without human operators will dominate long-haul logistics. Savings from reduced labor costs and increased trailer utilization rates via faster rides are substantial. Automakers already testing prototypes still need to demonstrate required safety. But once refined, autonomous big rigs will transform hub-to-hub distribution economics.
Exoskeletons
Powered ergonomic exoskeletons worn by warehouse workers enhance strength, speed and stamina when lifting, pulling, and manipulating items. These bionic suits prevent repetitive strain injuries from frequent materials handling motions. Businesses trialing prototypes report exceptional productivity gains plus overwhelmingly positive feedback regarding comfort.
Augmented Reality
Future workers wearing augmented reality glasses receive real-time guidance on optimally fulfilling duties. For example, computer vision overlays highlight proper selection points or project holographic models demonstrating ideal packing arrangements. Hands-free audio instructions also Provide step-by-step directionality. This technology promises to improve training efficiency and decision support.
Additive Manufacturing
3D printing revolutionizes replacement parts logistics through on-demand fabrication. Rather than maintaining slow-moving component inventory, businesses simply store digital blueprints then print items as needed on-site via extrusion. Although initially supplementing existing scale production, this technology may eventually enable highly distributed hyper-local manufacturing.
Final Words
The pace of innovation reshaping supply chain operations generates tremendous opportunities alongside daunting complexity for leaders aiming to futureproof competitiveness.
While emerging capabilities like additive manufacturing, exoskeletons and autonomous drones showcase tantalizing potentials, companies must avoid overextending resources chasing too many disparate pilot projects simultaneously.
Strategic focus matters because digital transformation requires carefully prioritizing high-impact opportunities delivering compelling value in areas like visibility, accountability, flexibility, and sustainability. But only a sharp emphasis on cultivating complementary talent and an experimental learning culture will unlock lasting wins.
FAQs
How can API-based integrations streamline our workflows with suppliers and partners?
Modern integration platforms leverage APIs to seamlessly link ordering systems, logistics trackers, inventory databases and more between companies. This real-time data synchronization saves manual efforts re-entering information and eliminates delays waiting for batch exports.
Why is blockchain valuable for bringing transparency across our complex supplier network?
Blockchain’s distributed encrypted ledger establishes a single shared record of transactions, shipments, payments etc. directly between businesses. All actions become verifiable and traceable back to their origins without obfuscation from intermediaries.
How can predictive analytics tools improve the accuracy of our B2B demand forecasts?
By analyzing large volumes of past sales data, AI-based statistical and machine learning models detect subtle demand patterns difficult for humans to manually identify. These insights enhance supply/production planning and inventory management.
What benefits can IoT-enabled asset tracking offer our business partners?
Connected IoT sensors provide 24/7 equipment statuses and movements to partners in real-time. This unprecedented visibility facilitates smarter utilization, security, and predictive maintenance across distributed corporate assets.
How can big data analytics optimize production volumes with uneven B2B purchasing cycles?
Sophisticated analytics translate immense information on segmented buyer behaviors into granular insights on fluctuating purchase frequencies, magnitudes, and seasonal impacts. These support highly tailored forecasting by product lines.
Why migrate our supply chain software solutions to the cloud versus continuing on-premises models?
Cloud-native solutions centralize data across the supply chain for improved analytics while enabling access from anywhere. Cloud platforms lower IT costs by automating maintenance and scaling elastically to usage spikes.
How can machine learning enhance inventory planning in complex B2B supply chain environments?
By processing volumes of historical data, ML models detect subtle demand patterns. As new sales data enters regularly, algorithms self-adjust projections to minimize inventory misalignments like stock-outs or excesses.
How specifically can blockchain-based smart contracts increase supply chain transparency?
Self-executing code enforces agreement conditions like pricing, delivery windows and volumes between companies. Any transaction alterations become visible to all parties by default – establishing accountability.
By Shantala Hickey,
ESG, Sustainability Supply Chain Manager
Shantala joined GPSI’s team in 2022, following her post-graduate diploma in Environmental Management. She is responsible for the ESG Division and the corporate social responsibility strategy. Before joining GPSI, she held several management positions at Bombardier Aerospace as well as Galderma, a company operating in the pharmaceutical and cosmetics industry. She has more than 15 years of experience in procurement, logistic, and production planning. The environment and sustainable development are undoubtedly her greatest passions.
