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.

Top 10 Supply chain trends for 2021 - Part 2After such a hectic and transformative year for the supply chain, 2021 is finally around the corner—here are the biggest trends to keep an eye on going forward.

So much has changed in the world of supply chain over the previous 12 months. With the onset of the COVID-19 pandemic, supply chains were forced to dramatically reorient themselves in order to survive. In a landscape altered by such a global event, which is still actively impacting the running of supply chains today, the changes are going to continue going into next year. Last week, we highlighted the first five most significant trends we are anticipating in the near future. Yet, there remain many more movements in the supply chain to watch out for.

This article by Morai Logistics completes the top ten trends that will shape supply chains in 2021.

Increases in Third-Party Logistics (3PLs)

Companies are always looking for ways to reduce the cost of their supply chains. If they can do so while improving its quality then all the better. Next year should see more companies looking to third-party logistics in order bring down costs, delivery times, and improve customer service.

An article from Finances Online further explains,

Partnering up with third-party services can help companies reduce costs while improving customer service. For instance, more businesses will integrate and start to offer inland services, reducing overall freight costs, and streamlining the supply chain. Integrations are particularly useful for shippers who often use a combination of sea and land transportation for their products. With integrated services, delivery times become shorter, and customer service improves.

An Elastic Logistics Surge

What’s become clear with the monumental disruption that the pandemic has brought is that supply chain efficiency isn’t enough. In order for supply chains to be able to survive in the current climate, as well as be resilient against further disruptions down the line, they have to be flexible and adaptable enough to deal with whatever fluctuations the market brings them. This more malleable approach is elastic logistics. Logistics made to make supply chains responsive enough to shape themselves around demand.

Further Adoption of IoT

As mentioned in Part 1, visibility throughout the supply chain is one of the highest priorities for companies. A large part of that effort to achieve such visibility is via the continued adoption of IoT devices. Certainly, IoT has already become a prominent part of supply chains. Yet, that prominence is set to grow even further, as companies look to IoT technology like sensors to give a complete and continuous view of their operations.

Artificial Intelligence (AI) Driven Automation

Automation comes in many forms. One of those forms (automated robots) was covered in Part 1. Another kind of automation that is becoming increasingly critical to the supply chain is automation facilitated by AI. One of the main reasons AI is playing such a big role in automation is that it can automate certain supply chain processes via algorithms based off previously collected data. This means the removal of human error and, thus, boosted efficiency.

Agility will be Paramount

Finally, as suggested in the Elastics Logistics section, there has been something of a realignment of supply chains this year. Supply chains can no longer prioritize being lean over everything else. With ongoing, and the possibility of future, large scale disruption hanging over supply chains, it’s become clear that agility comes before everything else. An agile supply chain means a supply chain that is able to quickly adjust its operations to respond to market pressures. That’s the supply chain of the future.

Top 10 Supply Chain Trends for 2021 - Part 1As a tumultuous year marked by supply chain disruption comes to an end, eyes turn to 2021—so what are the biggest trends to watch out for heading into next year?

It’s been a year of incredible turmoil and, subsequently, change. This has been especially true in the world of supply chain. Supply chains were hit very hard by the COVID-19 pandemic and were made to aggressively transform their operations in order to survive. As such, the year has seen them experience digitization at a rate unlike ever before. Moreover, their has been a strategic pivot from efficiency at all costs, to agility in order to bolster resilience. Now, as a new year fast approaches, the question becomes: how will these many changes shape supply chains going forward?

This article by Morai Logistics highlights 5 trends that will influence supply chains in 2021.

Environmentally Responsible Supply Chains

The push for green supply chains has been strong for years, and next year will be no different. More than ever before, customers expect the companies that they buy from to be responsible in regards to the environment. Not only that, a majority of them are willing to pay more in order to support products that are.

Thus, by taking their supply chains green, companies not only work towards bettering the environment but also gain more loyal customers. Not only that, but it has the added benefit of positively affecting company culture and reducing waste, improving profit margins.

The Automation of Robots

Automation and robotics have been tremendous forces of productivity in the supply chain in recent times. As automated robots are able to uniquely assist various sections of the supply chain, they’ve staked a claim for being a required component of quality supply chains. With that in mind, it’s hardly surprising that their adoption will only continue at higher rates than before in the future.

An article from Finances Online provides an overview of many of the most valuable capabilities of automated robotics,

More companies today are using drones and driverless vehicles to streamline logistics operations. Companies and consumers can expect drones to become fully capable of making deliveries of small goods. Self-driving cars are also likely to be more advanced by 2020 … In warehouses, autonomous mobile robots will see more use in speeding up menial, labor-intensive tasks … robots can drastically improve the supply chain’s productivity.

Blockchain Growth

Blockchain technology, despite a lot of buzz, has seen slow adoption. Given the many concerns around it, including whether it’s truly scalable in its utility, the hesitation has been understandable. Yet, as visibility remains a major priority for companies, the technology is becoming hard to deny. More and more, companies are viewing it as a central piece in their supply chain visibility. With this being the case, blockchain saw considerable growth this year, and that growth should continue in 2021.

Emphasis on Transparency

Tied to both sustainability and visibility, is supply chain transparency. Customers want to know the consequences of a company’s supply chain when buying its products. These consequences range from their environmental impact to their working conditions. In response to this, companies are looking to find ways (including the aforementioned blockchain technology) to give customers a transparent view of their supply chain operations and their outcomes.

A Globalized Workforce

The workforces of companies are changing. Already research shows that 80% of manufacturers have multinational operations as of this year. The main reason for this comes down to skills. Companies have skill gaps that they have to address, and limiting workforces to a single country hurts their ability to gain access to that necessary skilled labour. With this being the case, the multinational workforce trend will remain strong in 2021.

5 Supply Chain Trends to Watch Out For

With supply chain companies having to continually respond to the needs of their respective markets, it’s critical that they stay cognizant of the many structural and operational advances being made in order to remain competitive.

Customers’ expectations about what supply chains should look like in terms of responsivity, transparency, and flexibility are greater than ever. As a result, supply chains are evolving faster than ever to meet and surpass those expectations. In turn, this evolution means monumental changes to the technology, management, and operations of supply chains.

Globecon Freight pointed out the scale of these changes in an article earlier this year,

Supply chain management is undergoing a significant transition that will change the face of shipping and logistics.

This week’s article by Morai Logistics identifies 5 prominent trends taking place and set to take place in the world of supply chains.

Digital Transformation

The need for supply chain operations to be digitized is stronger than ever and will only grow going forward. If supply chains are going to take advantage of the many technological innovations today and in the coming years, they need the infrastructure for it. That means making their operations digital. By undergoing a digital transformation, supply chain companies can lay the groundwork to make their technological progress iterative, not singular. Technology will keep advancing and it’s crucial supply chains keep abreast of it.

Artificial Intelligence (AI) and Automation

Both AI and automation are set to greatly boost efficiency, lower costs, and drive profitability in supply chains. They can work individually or hand-in-hand to improve a range of supply chain processes. These include (but aren’t limited to) warehouse management, forecasting, data collection, equipment maintenance, and waste reduction. AI and automation are only going to become even more powerful, adaptable, and precise in the future. Thus, it’s inevitable that their presence will only grow in supply chains.

Transparency

More than ever before, customers expect to know the state of their product from beginning to end. This means that supply chain companies need to ensure that their chains are as transparent as possible. This is set to be achieved in a variety of ways, including blockchain, transparency mapping, tracking materials, and third-party certification. Blockchain in particular is primed to play a major role in supply chains going forward, as it is a database that’s data cannot be altered. Moreover, the data that’s entered in a supply chain blockchain needs to be verified by everyone in it.

Real-Time Tracking

Building off the demand for transparency but also the continual need to be able to check on the integrity of a supply chain is the advent of real-time tracking apps and devices. These can be wearable devices that employees wear, helping them with a variety of tasks that are then instantly available for review. For example, a warehouse employee can use a device to input data regarding inventory. This data in turn can be viewed by the inventory manager. Additionally, apps can be made available for customers and those overseeing the supply chain, so they can see the data being collected along it to make sure it’s proceeding smoothly.

Customer-Specific Supply Chains

A generic, one size fits all supply chain is quickly becoming a thing of the past. Supply chains are growing increasingly segmented for the sake of customers. In order for customer needs to be met more precisely than before, supply chain companies are recognizing that each supply chain should be uniquely geared to them. In practice, that means dealing with customers directly (a direct-to-customer approach). It also means setting up supply chains to be pliable enough to proactively respond to customer interests.