Due to the increasing global demand for autonomous solutions, investment in supply chain technologies has increased tremendously. Gartner predicts that by 2023, 50% of global eCommerce enterprises will invest in real-time supply chain solutions, artificial intelligence, and advanced analytics capabilities.
The COVID-19 pandemic amplified the need for technology tools to manage supply chain challenges that are more important, as lockdown is likely to happen in the future.
Organizations will continue to invest in supply chain technology to address data quality, compliance, risk management, connecting silos, understanding fast-changing markets, costing, and supplier relationships.
In 2022 companies will begin to apply technology-driven models across supply chain operations to better prepare for the risks of supply chain management, product development, and sales lifecycles. It will give them greater confidence in knowing that they are on the right growth path. Ultimately, technology can help companies prepare for future risks. To prepare for the future of supply chain management, take note of these supply chain technology trends in 2022 & beyond to advance your business performance.
Five Supply Chain Technology Trends to look out for
Digitisation of Supply Chain
The percentage of the technology in the supply chain is only 1% which will increase to 23% by 2025. The pandemic-induced lockdown pointed out the essential need for tech adoption.
Digitization of the supply chain includes much more than just eliminating manual tasks; it involves process and payment automation, improving resource efficiency, and delivering valuable insights. To reap outstanding rewards, companies need to apply supply chain technology directly within the operations.
The tech leaders need to expedite the process of supply chain digitization and implement new initiatives and solutions. They use technology tools that integrate seamlessly with existing systems, such as transportation management tools, demand forecasting tools, analytics, and reporting tools. Digitization of supply chain data eliminates the risks of information silos and allows for more accurate forecasting and planning.
Visibility into Supply Chains
Supply chain visibility has always been important for organizations and will also be vital in 2022. Reportedly, more than 90% of supply chain firms said visibility is one of the most critical factors for success. Supply chain technology and visibility help companies save time and free up resources for more critical issues.
Supply chain visibility is key to improving a company’s overall customer experience, preventing issues related to stock shortages and order backlogs, and helping frustrated consumers. It is not good to tell your customers that shipment is delayed or arriving at your doorstep in 7 days, or we don’t know where your package is and when it will reach you.
According to reports, 42% of supply chain executives find Cloud one of the most critical technologies for supply chain visibility. The fact is, this technology can help enterprises to remain more agile in the ever-changing business world and supply chain disruptions. Cloud is now the core need of the enterprises, as it provides innovative capabilities for managing traditional supply chain methods.
In addition to this, Cloud will allow businesses to visualize data from across platforms and projects, bridging gaps between their operational and digital capabilities. The new and improved Cloud technology in 2022 will be critical for businesses to be more efficient, accurate, and safer in the competitive environment.
Supply chain forecasting is essential during the pandemic as it helps optimize activities of overstocking, dissatisfied customers, lost revenue, and more. The traditional ways of predicting just can’t help measure real-time supply chain data and cost reduction strategies for the best results.
So what is the best method of supply chain forecasting in 2022? There is not only one method for supply chain forecasting, and it will never be accurate because the data of forecasting is based on assumptions. The analysis of unforeseen events can defy those assumptions. For example, supply chain disruption because of the pandemic or lockdown.
However, qualitative forecasting is the method that can be applied in those situations where resources are unavailable or unreliable. It is one of the most powerful methods to get accurate forecast results using factual information and statistical data like historical analogies, opinions of staff members, and real-time data insights for strategic forecasting.
Data-driven decision-making can’t be underestimated. This is why 80% of companies use qualitative forecasting methods for strategic supply chain planning annually. And it will become more popular and relevant in 2022 and beyond.
Forecasting today needs to be done using reliable data to eliminate data silos in the supply chain. Quantitative forecasting is based mainly on historical data and averages. However, it doesn’t consider the recent information, which doesn’t allow it to put more emphasis on seasonality or trends.
Quantitative forecasting is ideal for the short-term analysis of supply chain activities. For example, ARIMA or auto-regressive integrated moving average is a method of supply chain forecasting for up to 25 months or less. Multiple Aggregation Prediction Algorithm (MAPA) is a new method of quantitative forecasting based on seasonality for showing supply chain trends.
AI, IoT, AR, Cloud Technology Continues to Trend
As companies continue to build out their supply chain strategies, industry experts expect to see “further investment in advanced technology solutions to improve supply chain performance, risks, and events. Technology helps make informed end-to-end decisions with cognitive automation platforms, real-time recommendations, and predictions, which will be required to create the self-driving supply chain.
The next generation of supply chains will also be based on advanced technologies, like AI, Machine Learning, the Internet of Things (IoT), robot process automation (RPA), and Augmented Reality. These technologies have the potential to eliminate repetitive manual tasks into highly automated processes and ensure superior performance in the supply chain organization.
In the future, companies will find new technological ways for supporting end-to-end supply chain management, execution, predictive analysis, and data analysis. The AI/ML, IoT, AR, and Cloud platforms are expected to help identify patterns, errors and correct supply chain data issues in real-time. This will enable supply chain leaders to focus more on supply chain innovations and front-end technologies.
Supply Chain Analytics
In 2022, organizations will incorporate supply chain analytics in two forms, heuristics and exact. Heuristics analytics is based on mathematical algorithms to find the answer to complex supply chain issues. Exact analytics solutions are based on data-related processes for faster and easier decision-making.
For the supply chain executive of a company, the chief benefit from such analytics lies in the comprehension of their supply chain network. This makes their decision-making accurate for possible issues. With the help of supply chain analytics, companies can analyze the data in real-time and send out alerts to suppliers and drivers for the potential problems early on.
Analytics will become a powerful tool of damage control and risk prevention for supply-chain decision-makers. For example, a supply chain strategy can determine the importance of how the product gets transported from your warehouse to the customer. Down the line, it could also let them know the possible effect of the problems on the customers. This type of risk analysis will be valuable as the supply chain proceeds to recover from the pandemic.
Typically, supply chain analytics strategy relates to delivery frequency, order size, fleet size, and how fast you serve distant customers.
In a nutshell
Supply chain companies operate on an enormous scale and often lack visibility on a micro-level. Enhancing your supply chain through technology can help improve the processes and perhaps even help you build a symbiotic relationship with your customers. In times of pandemic, technology can make a difference in being able to conduct logistics operations successfully.
Industry leaders need to adopt a broad and holistic perspective when applying technology for data mining, visibility tools, autonomous transportation, and enhancing customer retention.
The author is a Content Specialist at Shiprocket, an e-commerce logistics solutions platform. She has a keen eye on trends and likes to share her thoughts about the upcoming technologies and innovations in the e-commerce logistics industry.