Make Way for Digital, On-Demand & Always-On Supply Chains

The evolution of the supply chain requires the adoption and adaptation of its leaders to the emerging technologies that are revolutionizing the way supply chains operate. Productivity and sustainability must go together on today's supply chain manager's agenda. The next-generation supply chain demands efficiency, agility, and flexibility.

A successful and balanced combination of automation and digital technologies is key to driving superior supply chain performance. Along with innovation, this can transform the supply chain, accelerate cost savings, and raise competitiveness. 

The emerging supply chain: What the digital supply chain brings

There is no doubt that the supply chain framework is evolving from the traditional model into a more connected, harmonized network of trading partners.

According to the 2017 MHI Annual Industry Report, the next-generation supply chain is digital, on-demand, and always-on. Innovative technologies will potentially transform supply chains into fully integrated next-generation models. The ability to adapt to and adopt these changes will determine which businesses will succeed inthe end.

The MHI survey, which was done in collaboration with Deloitte Consulting, found that 80% of respondents, including CEOs, VPs, general managers, and department heads, believe the digital supply chain will be the predominant model within the next five years. Meanhwile, 16% of the supply chain leaders surveyed are certain that the digital age is already here. Respondents included 1,100 manufacturing and supply chain industry leaders 

Innovative technologies shape the next-generation supply chain

Disruptive technologies born in this digital era include robotics and automation; predictive analytics; Internet of Things (IoT); autonomous vehicles and drones; sensors and automatic identification, inventory and network optimization tools; and wearables and mobile technologies. Each has the potential to transform industries and change consumer expectation. Cloud computing and blockchain will continue to support ongoing improvements.

Consider this: more data has been created in the past two years than has been made in all previous years combined. Next-generation supply chains will use this trend to develop new digital capabilities such as the strategic placement and use of sensors and artificial intelligence (AI).

Available data (scrubbed for accuracy) provides a solid foundation for real-time visibility and information sharing. When filtered through a layer of analytics and communicated across the entire supply chain, godo data allows for proactive and full-sighted operations, according to the report. 

Human augmentation

Automation and wearables are populating the warehouse bringing insight to supply chain workers who make necessary adjustments based on real-time information. Machines augment human performance. The result of this is an always-on and on-demand networks that are efficiently tied to the broader business strategy and becomes a source of competitive advantage. 

An important point to consider is how to harness big data. The first step a company must follow is to correctly establish the IT infrastructure that will allow the data to be collected in an automated and organized manner, stored with proper amounts of capacity, and cleansed to ensure reliability.

Only careful thought and planning will result in insights from mining the information collected. Artificial intelligence (AI) and algorithmic processing are the best to perform this process. This allows to free up human talent to better focus on other business-critical factors. 

Escalating on-demand customer requirements

A report published by Deloitte University Press found that customers have an increased comfort with technology; more specifically, this is true about the technology used to facilitate online transactions.

Users are more demanding in terms of short service cycles, lower costs, transparency, and corporate responsibility. Supply chains are expected to deliver faster, better services. According to the report, on-demand supply chain is the next level of service that will be able to provide delivery to customers anywhere and anytime.

The retail industry has seen this with the rise of omnichannel fulfilment. However, this is now having a major impact on industries that are not consumer-facing.

Leading firms are forced to demand more speed, visibility, and transparency from supply chain partners to meet customer expectations. Pressure is on the supply chain as retailers also have to provide more flexibility and efficiency in order to support the on-demand model, characterized by cost reduction and increase in service.

The challenge of on-demand

On-demand is not only challenging retailers and customer-facing industries. It challenges the whole supply chain regardless of size, industry, or position in the value chain. To face these challenges supply chains are adopting the previously mentioned innovative technologies that will make next-generation supply chains smarter, more flexible, and more efficient. 

Always-on supply chains

If supply chains are to escalate service expectations they must operate around the clock. They must be always-on. An always-on supply chain is defined as “an integrated set of supply networks characterized by a continuous and high-velocity flow of information and analytics, creating predictive actionable decisions that better serve the customer.”

For supply chain managers willing to lead the transformation of their SCM, it is of paramount importance not to overlook the potential of fast adoption and digital transformation of the entire value chain. 

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