The popular image of the supply chain conjures up trucks, trains, and huge container ships. But these powerful pieces of equipment don’t move without a network of cutting-edge technology backing them up. From battery-powered vehicles to autonomous warehouse robots, organizations driving the supply chain are already embracing the next technologies that will help give them a competitive edge.
A recent survey from Gartner reported that 61% of supply chain leaders viewed technology as “a source of competitive advantage,” and it’s not hard to see why. PWC reports that a business’s supply chain commonly represents more than 10% of its overall costs, so any improvement delivered by investment in new technology can produce dramatic results in efficiency, cost, and business agility.
Of course, organizations are pursuing countless innovations across the supply chain at any one time. But there are three in particular that have the power to transform the supply chain as we know it across the globe.
Though it may appear to be just another new industry buzzword, “hyper-automation” distinguishes itself from conventional automation by combining several different technologies.
Hyper-automation seizes upon advances in artificial intelligence (AI), machine learning, and robotic process automation (RPA) to automate a vast range of tasks across the whole supply chain at an incredible scale. Significantly, this includes those tasks that might have typically required human judgment or action. Rather than automating a single process or activity – such as picking and placing items in a warehouse – hyper-automation will be able to pick between multiple scenarios and make intelligent decisions based on real-time data.
A well-managed hyper-automation system can eventually incorporate intelligent document processing and could allow companies to automate many of the back-office elements of their supply chain. Indeed, Gartner reports that “a large majority” of supply chain leaders expect their systems to become fully autonomous sometime after 2030. Intelligent document processing would allow supply chain staff to focus on areas that AI cannot handle, where human skills and experience can deliver real value.
With so many partners and moving pieces – often quite literally – the staff managing vast supply chain networks struggle with overall visibility. This lack of clarity can lead to inefficient transport, planning, and resource allocation. And it potentially opens up opportunities for counterfeit goods or items with unethical origins to enter the system.
The solution to this issue may lie in blockchain’s distributed ledger technology.
The core of blockchain is a digitally distributed ledger of records. These records can include prices, locations, quality, certification, and other details for any given item. By ensuring that every stage of a product’s journey through the supply chain is entered into the ledger, blockchain can maintain a single, shared version of the truth. This iron-clad record makes it possible to track and trace goods from a single record that cannot be altered, redacted, or lost.
There are several benefits to this reliability beyond simply making paperwork easier. For example, a supply-chain focused blockchain can slash the time spent validating shipments, checking quality certification, and tracking incoming and outcoming shipments. The partners involved at every step of the chain add the relevant information to the blockchain and from that point forward everyone in the process can clearly see where goods are, where they have come from, and who has ownership.
Another significant advantage of blockchain technology lies in its end-to-end traceability. Recent research from Oxford Economics found that only 21% of companies had complete visibility into their sourcing of sustainable products. However, with the use of blockchain, organizations can trace a bag of beans from the plantation through to the coffee shop. This traceability doesn’t just help buyers ensure products and materials are of the highest quality. It also allows the business involved in the sale to ensure they meet ethical and sustainability requirements.
Information is critical when it comes to scheduling, resourcing, and controlling an efficient supply chain. Everything from factory output to current shipping times influences decision-making, and experts need that real-time data delivered in an accurate, easily digestible form.
Advanced AI software embedded into a business’ supply chain systems can provide the desired visibility into this information. With powerful machine learning tools, AI can deliver real-time dashboards, predictive analytics, and cutting-edge data visualization to help companies make sense of their information. Gartner is already predicting that half of supply chain organizations will have invested in AI and advanced analytics technology by 2024.
Harnessing all of their data into one powerful suite will help organizations manage their existing supply chain more efficiently and help them improve resiliency. By spotting potential bottlenecks before they happen or anticipating short stocks before a site runs out of goods, AI-driven systems can make the correct moves and adjustments to minimize disruption.
There is a common theme to these three technology trends. All of them manifest the increasing power of data and the benefits of smart automation to drive efficiency throughout the supply chain.
The cutting-edge elements of these innovations might not be in widespread use yet. For example, while Gartner estimates that around 70% of enterprises have started hyper-automation initiatives, these developments are often siloed off from one another and poorly coordinated across the business.
However, process automation and intelligent document processing are better established on the operational side of the house, including the shop floor, and deliver tangible results. While the back-office is lagging behind today, the developments we are seeing today will rectify that situation soon enough. Advances in AI and machine learning are deepening the dependence of our supply chains on technology even further. The leaders of this supply chain will achieve new levels of intelligent, optimized, and automated operation.