Supply chain innovations that can help your business stay afloat in crisis time
There are three things you can watch forever: fire, water and how technology is changing the world. Over the past few years, the supply chains at enterprises have undergone significant metamorphosis. The main drivers of change were both technological innovations and the economic downturns of recent years.
Thus, according to data from Statista, when asked about whether the COVID-19 pandemic had affected the supply chain, most respondents answered “yes.”
In the current realities, businesses have to adapt to the new world, follow the trends and vectors of technological development, so innovations are now getting closer than ever. In this article, you can learn more about how to use global change at hand and what trends in the supply chain will help your business stay afloat.
Let's begin with the most disappointing news. Supply chain at enterprises is changing not only due to technology, but also because of the borders closure. And the forced exit to self-isolation majority of employees has made the whole process significantly slower.
According to Statista, about 56% of global electronics manufacturers report delays in deliveries for 2-4 weeks in March 2020, and the situation in other industries is no better.
But there is always a likelihood of product loss on the road, the supply chain interruption and the human factor. There are many risks associated with the supply chain that only grow during times of crisis, and people cannot always solve them.
Most often, this requires innovative technologies.
Supply chain innovations in 2020
1. Software to optimize the supply chain
High-quality software is one of the most important elements in a strong supply chain management for any enterprise. Companies around the world begin to digitalize the supply chain, automate the most important processes in the warehouse and beyond. This IT-solution will be relevant not only in the current conditions associated with the difficulties of remote work. It has a long-term perspective because it will allow your business to adapt to rapidly changing market conditions.
Enterprise software will reduce errors in financial and logistics operations. Digital supply chain management will enable the digitalization of work processes, which speeds up the work of the company as a whole.
If you are looking for an innovative solution, you're in need of custom software. Ready-made software has never been an innovation, but custom software is a brand new new solution for your business that can turn the market situation in your favor. Custom software adapts to the requirements of your company allowing you to continuously improve the product. Perhaps robots, drones and AI are not for you, but this is the step into technological world that you can take now.
2. Radio Frequency Identification (RIFD)
Radio frequency identification is an innovative solution that will help get rid of the headaches due to delays in the supply chain as well as of the negative impact it causes to the brand. Now that the supply chain processes are slowing down due to quarantine restrictions, such remote control would come in handy.
Radio frequency identification technology will track the product during the production and transportation phase using the integrated chip, leaving the chain unbroken. This will speed up the supply chain processes and help save costs, as the product will not be lost during transportation.
Due to constant updating, the cloud is safer than physical media, more reliable and easier to store data on it. Majority of world's top companies are now choosing to switch to the cloud not only in computing processes.
For example, cloud technologies can take a real-time inventory, isolate key supply chain weaknesses, and accelerate processes, giving businesses a competitive advantage. The world is gradually being transported into a virtual environment, so take advantage of these changes to improve your own business.
4. Robotic delivery, drones and driverless vehicles
Perhaps the most innovative solution of all presented here. Driverless vehicles can save you money on the driver’s salary and insurance, and robotic delivery can be not just a modern solution, but a PR move.
Some companies use robots to retrieve goods from a warehouse, which allows you to store products in a small space vertically. Some choose this solution to automate the packaging process.
5. An artificial intelligence
Machine learning is great for optimizing supply chains because of its ability to recognize different patterns, models, and regularities. Artificial intelligence can track shipments or manage inventory. In addition, while your manager is staying home and stroking the cat, the AI does not need quarantine and cannot get infected with COVID-19. So if you need an employee who does not take sick leave, come to the side of technological progress, as Darth Vader once, if you understand what we are talking about.
Forrester analytic company has analyzed about 400 leading companies in the supply chain and found out that at the end of 2019, already 55% of companies turned to AI services. We will talk in more detail about the example of such a company further.
6. Predictive analytics
In the supply chain, there is a huge amount of data always involved, and predictive analytics tools can come in handy for their interpretation. Predictive analytics is already widely used around the globe, as it is able to inform about optimal solutions in the process, as well as streamline the supply chain.
According to Gartner, as early as 2018, about 50% of companies used this technology to automate decision making.
In times of crisis, working with data becomes especially difficult due to increased risks and barriers to the functioning of the supply chain. If in previous times it was a difficult task to compile reports or develop an optimal supply route, now when the processes have slowed down, routes are changing and borders are closed, this has become more of a challenge. This technological solution could reduce your stress in unstable times and will be helping your business to function stably after.
Supply Chain Innovation: Case Studies
There are many innovations in the supply chain and every day they are developing in order to simplify production processes at the factory as much as possible. Many companies are already looking for innovative solutions to keep up to date.
The world's famous company producing cider and beer, which has been working with JDA Software for more than five years, decided to expand partnerships with them in December last year. The company's plan is to move from the sales and operations planning strategy to integrated business planning.
This way, Heineken are going to make their business planning better. The transition to the new approach for the company is an opportunity to combine sales, marketing, procurement and the supply chain on one platform. It will allow them to find a compromise between the costs of the business and the profit from its productivity. In December 2019, this helped the company increase their revenue in Europe.
The corporation uses the well-known Saffron AI technology to evaluate new suppliers and select the most suitable ones for them. Saffron evaluates the suppliers geographic location, skills and positions, creates virtual maps, and helps the corporation make decisions. Such an AI product reduces the need for managers and simplifies the supply chain processes in general.
The AI solution, known as Saffron, was specifically created to determine the relationships between different components or data. Their example shows that the use of AI helps the manufacturer find the connection between the desired delivery option and supplier candidates.
This logistics giant has announced a partnership with TuSimple, a driverless vehicle startup. In May of the same year, the first cargo transportation between Phoenix and Tucson was launched in Arizona.
Even though the technology of fully autonomous cars is still imperfect and needs to be improved, the company decided to invest in the development of this startup. They will continue to research innovation for the successful implementation of autonomous technologies in the company's work. TuSimple, meanwhile, plans to fully automate the freight deliveries in 2021.
Custom enterprise software development is what will help you improve your supply chain, solve a whole range of problems your business is facing and stay afloat in difficult times.
If you continue to search for new technological innovative solutions, you will get a competitive advantage and be able to outperform those who won't change even in the crisis.