5 Business Innovations Changing Supply Chain Management
Efficient supply chains help businesses to be more competitive in the logistics market. One study shows that 57% of companies have admitted supply chain management gives them an edge over competitors and enables them to develop their business further. With the advent of data analytics and automation, supply chain processes have become more streamlined than ever.
The incorporation of technological solutions such as artificial intelligence, autonomous robots, and RFID is rapidly transforming supply chain processes. With the integration of technology, logistics has become faster and efficient than ever before.
The use of technology in supply chain management has completely changed the structure in which businesses operate.
In this post, I’ll list five key innovations that are transforming the supply chain industry.
Let’s dive right in.
1. Data Analytics and Artificial Intelligence
Big Data Analysis and Artificial Intelligence are making a significant impact on Supply Chain Management. Automation in data processing allows supply chain managers to get vast amounts of information in real-time and make smarter decisions based on that information.
Additionally, the internet of things (IoT) devices provide supply chain companies with reliable data on consumer inclinations and logistics trends. The best part about artificial intelligence is that it transforms raw data into actionable information without the need for human interference. According to McKinsey, after incorporating AI into their supply chains most executives reported an increase in revenues, whereas 44% reported a reduction in costs.
IoT is also helping supply chain companies in effective fleet management by automating their day-to-day business operations. For example, devices like ELD solutions allow managers to record driver logs, Hours of Service, browse engine data, and perform vehicle Inspections with a few clicks.
2. Impact of 3D Printing On Global Supply Chain
With advances in 3D printing, companies are manufacturing and delivering products quickly. 3D printing allows manufacturers to produce customized products and spare parts according to the needs of consumers. As manufacturing processes are customized and fastened, supply chains are becoming shorter, and the demand for goods supply is changing.
To stay competitive in the logistics market, supply chain companies are also turning to 3D printing to deliver products quickly. By adopting this technology, manufacturers produce goods closer to consumers, resulting in lower inventory levels, reduced shipping costs, and economical warehousing. According to a survey by Gartner, 65% of global supply chain managers are already using or plan to invest in 3D printing.
3. Autonomous Robots
The use of autonomous robots in supply chain management is improving the speed and accuracy of routine tasks, increasing productivity, and decreasing management costs. The bots are particularly helping in warehousing and manufacturing. Besides increasing efficiency by working side by side with human labor, the bots also reduce the risk of injury in dangerous situations.
Robotic process automation (RPA) helps supply chain managers locate and enhance inefficiencies across the chain. RPA also allows managers to run a smooth operation by responding to queries 24/7 through artificial intelligence.
Some supply chain giants are also investing in autonomous vehicles to cut payroll costs, eradicate the risk of human injury on the road, increase fuel efficiency and reduce vehicle wear and tear. All this ultimately increases Return on Investment (ROI).
4. Use of Logistics Software
Supply chain management companies extensively benefit from logistics software, such as the Transport Management Software, or TMS. TMS offers a digital platform for supply chain managers to optimize fleet operations by efficiently tracking inventory and materials across the supply chain in real-time.
In traditional supply chain management, fleet tracking was a time-consuming manual task with a high chance of error. Logistics software systems have automated warehousing and inventory tracking. This ultimately improves accuracy and minimizes operating costs while ensuring transparency between the businesses and the consumer market.
5. Radio Frequency Identification
Like most other businesses, Radio Frequency Identification or RFID is contributing effectively to supply chain operations. RFID is a wireless technology that uses radio signals to tag objects. These tags look like barcodes and are used to automatically identify, follow and trace goods in real-time without human intervention. This significantly improves data accuracy and traceability throughout supply chains.
The RFID technology offers several supply chain benefits, including efficient material handling, enhanced asset management, and improved merchandise availability. It is particularly beneficial in managing supply disruptions by reducing workload and eliminating human errors.
Technology, especially automation, is transforming every industry around the globe. Technological advancements are making a significant impact on logistics and supply chain management as well. With these innovations already in use by the industry giants, it is high time that small businesses also integrate them into their supply chain processes to ensure lasting success in the industry.
Craig Stobbie is the Director at Endura Private Wealth. With over 12 years’ experience in the industry, both in Australia and in the UK, and holding the internationally recognised Certified Financial Planner™ designation, the highest qualification within the Financial Planning Association of Australia, he specializes in helping people with transition to Retirement planning, Superannuation, Investments and meeting their Insurance needs.