Two years ago, the world was at the peak of the first wave of the COVID-19 pandemic. Lockdowns and travel restrictions disrupted business and civil societies in every part of the globe. While demand evaporated in some segments, it skyrocketed in others. Many companies struggled to stay afloat, and they tried to plan significant strategic changes to the configuration and operation of their supply chains. Many senior supply-chain executives agree that they intended to make their supply chains far more flexible, agile, and resilient due to the disruption caused by the pandemic. In fact, the pandemic unveiled some of the long-standing vulnerabilities and risks in organizations’ supply chains. In some cases, it forced companies to look hard at their operations, processes, and business models. However, most industry leaders agree that the pandemic has helped them realize the vulnerabilities of their existing supply chain practices and the weaknesses in their corporate strategies.
Some of the major disruptions in the supply chain were the result of the suddenly disrupted transportation systems and the loss of access to logistics. In the past decades, companies have cut their production processes into small segments and relocated them to offshore locations worldwide. This helped them maximize their profits and run the operations faster. For such a production and trade model, stable and timely logistics are very important to the supply chain. If a part of the chain is blocked, it significantly affects the subsequent production activity. For instance, car manufacturing plants in Japan stopped working because they failed to transport the spare parts sourced from other parts of the globe to the factories. More importantly, many manufacturing units followed a lean production system, forcing them to maintain lower inventory levels. In this scenario, how do organizations manage complex relationships between suppliers, shippers, and production processes and eliminate numerous pitfalls?
Improving Supply Chain Visibility
Lack of real-time visibility was one of the major reasons that affected the movement of goods and services to the right place at the right time during the pandemic. This became more evident when the delay of essential supplies put lives at risk. However, companies can overcome the challenges of supply chain visibility through digitalization and enhance real-time visibility into product attributes, including status and location.
This presents organizations with an opportunity to reorganize and restructure global supply chains. While doing so, they can also improve the transparency and traceability of goods and reduce their environmental impact.
Companies can create an immutable data trail leveraging digital capabilities such as AI and Blockchain to improve business and consumer confidence. By applying the same technology, they can monitor the quality of goods shipped and delivered. In some cases, eco-conscious companies even monitor carbon emissions associated with the goods transported across the supply chain. As consumers also want to know the chain of custody to ensure that the goods are free of contamination while traveling across the supply chain, companies can provide complete visibility across the supply chain. In essence, emerging technologies introduce additional clarity, transparency, and trust to the supply chain processes to a great extent. More importantly, it also reveals the availability and safety of goods while accelerating the delivery time.
Overcoming the Supply Chain Challenges: The Technology Imperative
When companies add new suppliers, partners, and source inventory from multiple parties, supply chain complexity increases rapidly, giving rise to siloed data structures. For that reason, aggregating the data from numerous departments within the supply chain to a single location is essential. This helps organizations generate a single source of truth, which is, in fact, a state of being for a company’s data that can be found through a single reference point. Companies can achieve this by implementing an integration strategy and an interface system that hosts the organization’s data. However, such a system works effectively only if all departments and teams have seamless access to the systems and data they use. In the long run, this also helps organizations run as it helps them optimize the entire business operations. There is no argument that these systems and processes help companies effectively address and optimize immediate and long-term supply chain needs.
With supply chain technology growing and changing at breakneck speeds, companies need to keep up with the trend. Innovative technologies give companies the competitive edge they need to differentiate their brand within the industry. Some of the recent supply chain technological trends followed by key market players include IoT, product life cycle management software, and automation and robotics.
IoT for Integration
Although IoT is used extensively in various industries, the supply chain adopted IoT technology very recently. However, the pandemic has accelerated the adoption, and many mission-critical processes are becoming interconnected using IoT sensors and devices. Many manufacturing businesses, including discrete manufacturers, process manufacturers, and transportation companies, are planning to invest heavily in IoT deployments to take advantage of improved manufacturing operations. Such companies also aim to significantly improve their production assets management, freight monitoring, and fleet management with IoT deployment.
Product Lifecycle Management Software
Every organization trying to streamline supply chain functions needs product lifecycle management software. This software helps organizations manage both data and processes at each stage of the production, servicing, and sales within the supply chain. PLM mitigates a variety of process challenges that occur throughout the lifecycle of a product. This helps companies align and integrate critical resources while conveying information to the team uniformly, quickly, and accurately.
Although blockchain-supply chain integration has become a popular topic for conversation, there are not many practical use cases that speak to the benefits of such an integration. However, all agree that blockchain technology ensures the validity of transactions and strengthens traceability along the supply chain. Although the technology was created to support cryptocurrency transactions, blockchains are expanding their footprints to other sectors, including the manufacturing industry. In supply chain and logistics, Blockchain is increasingly used to trace the ownership of goods.
Automation and Robotics
Robots and automated machines are an integral part of warehouses and factories. By utilizing the power of AI and IoT, warehouse operations can be made more sophisticated. In addition, industrial automation can enhance and streamline operations by quickly detecting errors and fixing them in real-time. This helps companies improve efficiency as automation identifies a problem in the postproduction stage and keeps the process running without sudden stoppages.
The perks of digital transformation are far-reaching, and companies are already making huge impacts on the organization’s returns. Many organizations are just beginning to explore and realize the immense potential and capabilities of a digitalized supply chain. In this world of continuous disruption, it is not enough to meet the consumer’s demand anymore. Industry leaders need advanced technology solutions to adapt and predict consumer demand and stay ahead of the curve.
It is clear by now that investments in the right technology will play a crucial role in optimizing the supply chain. As the world moves out of the upheaval caused by the pandemic, companies need to put their prime focus on supply chain resilience and risk management. There is no argument that companies that take proactive steps to adapt to the future changes will fare much better in the days to come.
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