Supply Chain Management: The Key Factors Shaping it Today – Part 1

Supply Chain Management - The Key Factors Shaping it Today - Part 1Just as the dimensions of supply chain have transformed, so has supply chain management in response to them—here are the biggest forces influencing it today. 

The supply chain landscape has seemingly undergone a seismic shift over the past year. Yet, much of what the pandemic has spurred on isn’t a shift in supply chain trends but rather an acceleration of them. Nonetheless, supply chain management has had to respond to this changing landscape, regardless of nature of the changes, as strategies that might have been on the horizon prior to COVID-19 are now imperatives for survival.

This article by Morai Logistics covers several of the most significant factors that are influencing supply chain management today.

The Ecommerce Boom

The growth in ecommerce has been astounding. For years it’s been rapidly rising. In 2020, that already incredible growth became even greater. This, of course, has implications all the way through supply chains. One more obvious implication is that managers have to put more emphasis on last mile solutions.

However, there are other less straightforward considerations they need to be mindful of, such as automation. The use of autonomous technology in warehouses has become even more useful. This is because they foster even greater productivity and, with concerns regarding the spread of COVID, they reduce human involvement.

The Need for Precise Personalization

Catering products or services as precisely as possible to the customer has become amongst the most vital components of quality supply chains. With digital transformation becoming the new norm for companies, it’s allowing management to harness the necessary technology (such as customer data platforms) to finely segment their customers and serve them accordingly. This means manufacturing itself as to be responsive and flexible too.

As a Forbes article on supply chain megatrends outlines,

Manufacturing automation…is making it easier to create many, many more product variants. Companies are beginning to explore on-demand manufacturing rather than traditional manufacturing models, meaning they can keep less physical inventory on-hand. Using a digital representation of parts allows manufacturers to make small changes to digital files quickly…

Supply Chain Softwares Hosted on Clouds

Modern supply chains need a variety of cutting edge softwares in order to stay competitive. What this has resulted in is more and more companies looking to cloud computing to host these applications. With the ability to implement and integrate new softwares quickly and scale operations accordingly, the cloud means managers have more solutions on their plate than ever before.

The earlier mentioned article by Forbes explains,

Covid-19 has also proven that cloud-based solutions can be implemented with far fewer consultants located at the customer’s site. Supply chain software suppliers have told me that in terms of implementations, Covid-19 was mostly a non-event; pivoting to remote implementation consulting was not that difficult.

IoT and Supply Chain Tracking

IoT’s had an increasingly critical role in supply chains in recent years. Their presence is only going to get stronger. In this case, it’s not a result of the pandemic. Rather, it’s because of the next generation of the internet becoming more widespread. As 5G becomes more widely available, supply chains can connect more devices to it.

It’s up to managers to evaluate how they can best utilize a more connected supply chain that has continuous real-time data available from various stages in the chain. If used the right way, IoT having a stronger role in the supply chain could mean better tracking of operations, the state of inventory, and more. Additionally, it could also mean greater visibility and thus transparency of the entirely chain.

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