Countries around the world are now joining hands to become one united global economy. The trade relations between them are becoming stronger and runs deep than ever before. The supply chains that make up the framework for trade between countries are becoming more robust.
Add in the contribution of technology and we are now looking at a scalable, reliable and accountable supply chain logistics that makes trading much easier. Like everything around us, they also undergo changes every single day, so let’s look at the supply chain trends for 2019 and beyond.
1) Risk management will be given top priority
One among the lesser-known facts about the global supply chain is that the risk factor has been slowly increasing in the last few years. Much of these risks arise due to political and governmental changes, but, the heightened risk at one point of the supply chain will result in the after effects to be carried over to other parts.
However, the list doesn’t just end there as economic instability, environmental risks, targeted physical or cyber-attacks are one among the most common risks faced by supply chains.
Hence, fortifying supply chain networks to better fend off these adverse conditions is the common objective that the supply chains around the world, a trend is that is indeed necessary.
2) Internet of Things
Sensors are now being employed in logistics with great results as they provide companies with means to track goods in real time. The implementation of IoT in the supply chain makes the whole ecosystem far futuristic, enabling the companies to track the shipments, monitor thermals and other valuable info in real time.
They are also very helpful in inventory management as parts tracking without intuitive systems like these makes it a time-intensive process. and as with supply chain, more time costs more money. With IoT, companies are also able to incorporate the following element into their work system.
3) A.I. Integration
Yes, IoT in Supply chain paved the way for A.I to before more involved in the process than ever before, reducing human effort and errors whilst delivering higher efficiency. A.I. is particularly effective at recognizing patterns and trends, devising the best course of action for the repeated occurrence of events.
By coupling IoT and A.I., companies can leave tracking to the software rather than employing manual tracking.
Unlike humans, A.I. doesn’t need off times and there are no specific working hours, they can work around the clock without needing any form of rest. In the supply chain, 24/7-hour monitoring is a great advantage as the company will get alerts and updates even on off hours. They can also be automated to do certain tasks that can help companies streamline the process even better.
4) The evolution from Chain managers to financial managers
The competition in the field of supply chain is increasing at a fast pace with new companies offering better services along with modern infrastructure. And this is forcing Chain Managers to dawn the role of Financial managers, helping the company to better manage their finances to maximize profits.
And the first place to start is by forging good relationships with suppliers, and customers alike. Then comes better management of working capital. The result of this transition is that the company will be able to outshine the competition.
This trend obviously requires personnel who have talent in both logistics and finance. And this is the reason why the selection process for supply chain managers are becoming more stringent nowadays. This trend is certainly going to be carried over to all major companies in the coming years.
5) Advanced Analytics
Analytics is one of the key elements of any supply chain. Accurate analytics helps supply chains to better manage resources, and get better returns on investments. Nowadays, technology has greatly simplified analytics, reducing errors and downtimes in the process. However, there are great lengths to go before in the field of analytics as the size of data sourced from various medium increase with respect to the expansion of the supply chain.
So there is the need for advanced analytics in supply chain and the supply chain leaders are already making strides of advancements in this area. A study led by Gartner partnering with 260 supply chain leaders showed the following data.
- 96% of candidates use predictive analytics
- 85% use prescriptive analytics and
- 64% use AI
It is clear that supply chain leaders use a combination of analytic methods to keep the margin of error at the bare minimum. In 2019 and beyond, count advanced analytics as a trend that will definitely stay in the supply chain.
6) Blockchain Based Records
A relatively new addition to the supply chain that shows this technology can not only serve cryptocurrencies but also lead the way for smart supply chain solutions. In short, Blockchain is a distributed ledger that is stored and updated digitally on a multitude of computers. The upside of Blockchain is that it is doesn’t need a central node to host itself and cannot be hacked as the copy of blockchain is present on more than one node.
Supply chain looks to blockchain as a means to simplify point to point payments, which in theory would eliminate the long delays experienced at these points. Since blockchain facilitates direct payment between the payer and the payee, the need for a central entity like a bank is eliminated from the system.
This results in no processing fees, faster payment, and a more secure network. Blockchain has not been widely adopted since it is in development for supply, however, it will not be too long until we see mainstream adoption.
7) Circular Supply Chain
A large part of the global supply chain works in the linear model where the product will start from raw materials, gets processed and manufactured, and then reaches the hands of the consumers. After the consumer is done with the product they are considered trash. However, the world’s resources are not replenishing at the same rate in which we are using them, many of them are even finite. Such an approach towards products results in an unsustainable model of living.
Circular chain adds the terms “Recycling” and “Reusing” at the end of the linear supply chain. In essence, the products that are disregarded as wastes will be salvaged to find the elements that can be recycled or reused and are returned to the manufactures themselves.
These materials are then recycled to usable products once again, thereby reducing global waste production while paving the way for a sustainable model of living. Circular Supply chains are attaining relevance and popularity, even some governments of the world make it mandatory on some manufacturers.
2019 is under away and the global supply chain is embracing the modern developments coming its way. The future trends for global supply chain certainly seem promising. The advancements are taking the global supply chain in the right direction, where delays and discrepancies are kept to an absolute minimum.
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