Logistics Minded

2016 Supply Chain Trends: 7 Trends to shape SCM

As we head into a new year it is a good time to take a look at the coming year and see what it may hold in the way of trends. We kick off today a month-long focus on trends in the following categories: Manufacturing, Manufacturing Technology, Supply Chain, Logistics, and Transportation Management. We have already covered the top 6 trends for 2016 in manufacturing. We will then do a deep dive all month long and until we have covered each trend individually within these categories. By the end of the series, we will have ample content to then turn it into a downloadable e-book that should serve any professional well as they look to continually improve themselves and, if they are a worker or manager within these categorical industries, can help keep an eye out for how you may apply a trend into your everyday workplace to stay competitive and efficient.

Today we will begin our two part series covering the 2016 supply chain trends we expect to see come to fruition in the next year. These trends are clear in that technology will continue to, as it has over the last decade, drive change in supply chain management. However, what is refreshing to see is that although technology and innovation are a focus, that also we must understand the fundamentals in order to make it all work. It was Bill Gates who famously quipped:

The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.

So, we must put a note on these technological trends: make sure you are looking at your processes and your people. Do you have the most efficient process that you can then scale with technology and automation? Do you have the right people in place? As you will see from one of our trends, we in the supply chain industry, and as we first hand know at Cerasis, that if you do not have the fundamentals down and the right people in place, it is very tough to get the results you seek. After all, any professionals job is to do the best job the most cost and time efficiently all while reaching your goals.

What 2016 Supply Chain Trends to you expect to see? After reading, we’d love to hear from you in the comments section below.

 

2016 Supply Chain Trend 1: Supply Chains will Look to Go Digital

Technology has driven a new wave of productivity by digitizing key financial and business processes and enabling collaboration across the organization. This 2016 supply chain trend will continue as best-in-class organizations leverage business networks to create a digital community of partners executing coordinated processes in a more organized and informed way than in the past.

But, Wait….What is the Digital Supply Chain?

Accenture has put out an amazing video describing the digital supply chain and states the following:

Digital technology is disrupting traditional operations and now every business is a digital business. The impact on supply chain management is particularly great. Businesses cannot unlock the full potential of digital without reinventing their supply chain strategy.

Many companies understand the elemental nature of these changes and are already working to introduce digital technology into their operations. However, simply adding digital technology is not the answer.

This approach overlooks the fundamental difference between traditional supply chains that have been “digitally enhanced” and truly integrated, re-invented supply chains whose DNA is fundamentally digital.

For digital technology to create significant improvement in business outcomes, businesses need to:

  • Reinvent their supply chain strategy
  • Reimagine supply chain as a digital supply network (DSN) that unites not just physical flows but also talent, information and finance

This new breed of supply chain is more connected, intelligent, scalable and rapid than traditional supply chain management.

In a metaphorical sense, the DSN enables people and data—as well as materials, products and supplies—to travel together across the extended enterprise.

This is vastly different from digitally enhanced supply chains which (because they are never stronger than their weakest links) have less potential to help companies:

  • Develop new synergies
  • Relate more fully to customers
  • Rapidly reach new markets and quickly build and scale new offerings

In today’s global and connected economy, digital supply chains are the on-ramp to innovation and success. And if you want to be among the winners, you need to get on the highway and go fast. Start today by re-imagining your supply chain. Develop digital strategies that allow you to proactively evolve ahead of the competition. Employ comprehensive solutions that support the entire source-to-settle process and create value for all parties involved in it.

 

2016 Supply Chain Trend 2: Responding to Innovation & Change But with An Eye On Fundamentals

As stated by Accenture on what is the digital supply chain, that you must rethink the supply chain. And, remembering Bill Gates, if we do not keep our eye on the fundamentals, technology will only put a spotlight on inefficient process. In this 2016 Supply Chain Trend, we are going back to the basics.

The ability to accept innovations and take advantage of the synergy effects of individual movements is a core competence of future-oriented companies. Not losing sight of the essentials while filtering out what is personally important, requires our full attention and continual development. Nevertheless, we reach our limits time and again and need support, e.g. from operations research, which provides us with intelligent decision-making algorithms enabling us to keep up with today’s fast-paced operating environment.

According to Grant Marshbank, COO of VSc Solutions, supply chains will face a number of challenges, he said: “Supply chain managers are already under huge pressure to adapt to turbulent economies, labor issues, and expansion into global markets.

“The bad news is that the rate of change isn’t going to slow down. The good news is that emerging trends hold opportunities to reduce both costs and carbon footprints, and enable exceptional customer service at the same time.”

“Technology will only deliver the intended positive results if it is implemented with strategy and operations that adhere to best practice in supply chain management. Get basics right first. Not even the smartest technology can compensate for less-than-best practices,” he added.

“Real-time system integration, secure data exchange, visibility and traceability between disparate systems across multiple supply chains and industry verticals are just some of the options already available through technology,”

“The greatest barrier to the adoption of these technologies is a lack of understanding of the benefits combined with an expectation of high implementation costs.”

Advances in technologies available to optimize supply chains have made faster implementation times a reality. “It is easier and more affordable for both big and small businesses to go live with a new system within two weeks of finalising paperwork,” explained Marshbank.

“Most supply chain professionals already have a sound strategic plan in place. Instead of being sold a new system, they might just need some guidance on how to solve their pain points by repurposing their existing technologies.”

“Being able to blend systems and implement tools on a scalable basis is what sets the technology of the future apart from the unwieldy enterprise-wide software packages that were popular in the previous era,” said Marshbank.

 

Curated from 2016 Supply Chain Trends: 7 Trends to shape SCM

 

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  • ANGEL says:

    In today’s global and connected economy, digital supply chains are the on-ramp to innovation and success. And if you want to be among the winners, you need to get on the highway and go fast. Start today by re-imagining your supply chain. Develop digital strategies that allow you to proactively evolve ahead of the competition. Employ comprehensive solutions that support the entire source-to-settle process and create value for all parties involved in it.