The holiday season is fast approaching, bringing with it a new wave of demands that has businesses scrambling to get a slice of the holiday-spending pie. Disruptive technologies, increasing trade regulations, and the breakneck speed of customer demand are pushing companies to rethink their processes and technology for the holidays and beyond.
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Companies seeking to stay on the forefront of supply chain management must embrace advances that give them an edge. A recent Aberdeen Group survey* of respondents across the supply chain industry examined how global trade management (GTM) has evolved from a collection of standalone supply chain and enterprise applications into today's integrated digital approach that ties everything together. The survey also reveals what the future holds as new technologies, such as blockchain, enter the space.
Inside the pressure cooker
Every company’s global supply chains face the same pressures. Reducing supply chain costs is a concern topping the list, and the new retail dynamic of empowered consumers means a higher demand for faster and more frequent deliveries according to survey respondents – 27% of them are finding this the number one stressor. This puts tremendous pressure on global supply chains to speed up their processes while minimizing inventories.
The pressure isn’t affecting just the retailers; it’s also pushed onto manufacturers and distributors who must support their partners with direct-to-consumer shipments. This means that any process inefficiencies are high on the list of improvements necessary at every level to improve global supply chain responsiveness.
The past still lingers
Previous GTM functions were characterized by silos of information with little collaboration across companies. Many of the processes were manual with limited automation, making integration challenging across departments and locations. The islands of expertise seldom shared information because of system limitations and manual process shortcomings.
Some early adopters attempted to develop homegrown systems, before commercial best-of-breed solutions were readily available. These systems were sufficient to serve the past, but today’s ever-increasing speed of business is driving rapid changes and innovation in global trade. The pressure is on to move beyond silos and home-grown systems and break out of past practices to keep up.
Aberdeen’s survey shows that 28% of all companies still use manual processes, even though they are recognized as antiquated. Add to that cumbersome process a lack of sharing up-to-date information, challenges sharing regulatory knowledge, and poor communication among stakeholders, and it’s a recipe for failure if not eliminated.
GTM grows up
Just as teenagers grow into adults, GTM has advanced from the siloed solutions of the past to single-platform solutions that continue to evolve. Single-platform solutions provide the digital model for sourcing logistics, trade operations, and trade compliance with a broad and deep set of cab capabilities that enable collaboration, automation, and analytics.
Best-in-class companies are embracing the GTM of today. Despite a fairly high level of in-house developed systems remaining in place, more than 81% of best-in-class companies surveyed by Aberdeen indicate they are more likely to adopt a best-of-breed GTM solution, either cloud-based or on-premises. Over 71% are more likely to leverage technology from logistics partners.
Real-time visibility is essential to the timeliness of data for decision making and keeping plans on track, especially when consumer expectations are now next-day or even same-day deliveries. Companies can’t wait any more. GTM can offer online visibility on global orders and supplier status on shipments, including in transit visibility once a product is shipped. Up to 69% of best-in-class companies surveyed say this online visibility into in-transit shipment is a must have of their GTMs, compared to 51% of all others respondents.
A digital platform becomes the basis of sharing information in real-time and having exception processes in place to immediate alerts any out-of-tolerance conditions. In the event of supply disruptions, real-time visibility and a communication network with all partners involved enables prompt action and avoidance of catastrophic delays.
The future is transforming
The acceleration of business processes due to consumer demands, changing policies and technology innovations are driving digital transformation initiatives across many global supply chain companies. Ecommerce demands speed which requires available-to-promise (ATP) information. Visibility is key to meeting that demand and speed, and new technologies will emerge to help in the future.
Some of the current technology trends are already leading the charge to innovative changes. More than half of the best-in-class companies surveyed are already adopting these new technologies in analytics, social streams and business applications, compared to all others who are 40% or lower in interest.
Regardless of where the future takes companies, having a digital platform is a cornerstone for capitalizing on new technology because it is digital. Digital is ready for new technology adoptions and having a current solution based on a digital platform is a good position to start from when integrating, merging with, or adopting any new technology.
Companies can prepare for the future now by embracing a digital GTM platform which will create the agility and flexibility needed for adopting future technologies quickly, while improving existing global supply chain management functions today.
* Survey respondents are broken down into three categories: best-in-class (top 20% of respondents based on self-reported performance); industry average (middle 50% of respondents); laggard (bottom 30%); and all others, a combination of laggard and industry average respondents.