Let’s examine the key supply chain trends that are affecting operations management today. And don’t worry, I’m not going to mention buzzwords like blockchain or the internet of things (IoT). I view those technologies as enablers rather than trends. Instead, I’d like to give you a realistic perspective on what is likely to impact the core aspects of your supply chain in the future.
Below are my top five supply chain trends that you need to keep a close eye on over the next two to five years:
1. Convergence of Physical and Digital
Unified commerce, e-commerce dominance and the convergence of B2B and B2C are all creating the need for the physical and digital supply chain to become synonymous. If either side becomes disconnected and the two don’t match, your ability to manage the complex supply chain quickly falls apart. I believe leading distributors and retailers will build a complete virtual model of their supply chain in the coming years to assist in forecasting, modeling and effective planning.
2. Transition to the Cloud
With the growth of the digital supply chain, there is an increasing need for all points of the supply chain – whether they are owned by you, a vendor or a partner – to be tightly interconnected. This is becoming more and more difficult if your supply chain systems do not reside in the cloud. My advice is to get onboard with this supply chain trend more quickly. Private supply chain platforms will soon be a thing of the past. The cloud-connected supply chain is the way to go.
3. Agility to Support Omnichannel Everywhere
A supply chain that can turn on a dime and adapt to rapid, multifaceted changes will be vital as your customer demands continue to grow in complexity. Without agility throughout the entire supply chain, it will be impossible for you to offer each customer their own personalized experience. This is an expectation that is becoming the norm for both B2B and B2C. Preparing for this supply chain trend of agility will require software providers to break down barriers and make intricate changes to all components of a supply chain solution set. On the flip side, software users will need to embrace and learn their solutions at a depth beyond today’s ‘user’ level.
4. Customer Awareness of Sustainability
Let’s face it, next-day or same-day delivery has an impact on our environment. As calculated by Time for Change, the effect of the CO2 emissions of airplanes are two to three times higher compared to the emissions on the ground because airplanes release the CO2 in high altitudes into the atmosphere, where they do much more harm. Consumers are slowly beginning to realize the consequences their fast delivery demands have on the planet. Therefore, we will see a rise in companies offering more sustainable shipping choices to customers.
5. Focus on Labor
The supply chain workforce is changing. Warehouse workers have different expectations than before and their willingness to perform certain tasks are constantly evolving. In addition to labor shortages and rising costs, it will be especially important for companies to focus on how they manage their people. I foresee the U.S. marketplace becoming more like Europe in its approach to labor management. Supply chains of the future must have solutions that adapt to the needs of the warehouse worker as opposed to the other way around. Automation is a solution to labor challenges, and I expect it to be much more pervasive in the coming years.
I’m sure there are more supply chain trends and potentially outliers that I missed. The world is changing rapidly and companies are expected to respond at speed and with scale. Some of your business challenges could feel insurmountable, but it’s not. With the right technology at your side, your supply chain can work faster and smarter, and face the challenges of changing markets and high customer expectations.
My advice is to develop short- and long-term plans for how these five trends will impact your supply chain. You will always be faced with new challenges from emerging trends, but know that Tecsys’ innovative supply chain technology can be at your side to help.