How to maximise supply chain tech investments

To nav­i­gate the com­plex­i­ties of the mod­ern sup­ply chain, busi­ness­es are turn­ing to tech­nol­o­gy. 

Research by sup­ply chain plat­form Blue Yon­der shows that 71% of UK organ­i­sa­tions have imple­ment­ed new tech­nol­o­gy over the last 12 months to reduce dis­rup­tion in the future. One in 10 organ­i­sa­tions are invest­ing more than $25 mil­lion.

Organ­i­sa­tions have ear­marked plan­ning, fore­cast­ing, and inven­to­ry man­age­ment as top areas for tech­nol­o­gy spend­ing. They’re seek­ing a real-time, end-to-end view of their sup­ply chains, often lever­ag­ing tech­nolo­gies such as arti­fi­cial intel­li­gence (AI) to rec­om­mend and opti­mise actions.

And it’s not just AI. Tech­nolo­gies like big data, machine learn­ing (ML), 5G and the Inter­net of Things (IoT) are also deliv­er­ing in terms of sup­ply chain resilience.

Dave Food is head of sup­ply chain at Board Inter­na­tion­al and post­grad­u­ate sup­ply chain lec­tur­er at the Uni­ver­si­ty of War­wick. He says the most crit­i­cal tech­nolo­gies are those that enable intel­li­gent, inte­grat­ed deci­sion-mak­ing.

Food sin­gles out tech­nolo­gies that enable ‘intel­li­gent plan­ning’ as indis­pens­able for dri­ving col­lab­o­ra­tion and align­ment across all depart­ments. Essen­tial­ly, intel­li­gent plan­ning is the process of analysing data to gen­er­ate action­able insights. It enables cross-func­tion­al teams to uni­fy strat­e­gy, finance and oper­a­tions to plan smarter, make bet­ter deci­sions, and take con­trol of per­for­mance.

Inte­grat­ed Plan­ning is key to plan­ning intel­li­gent­ly. It is cru­cial for cre­at­ing an autonomous sup­ply chain man­age­ment sys­tem.  

“One of the under­val­ued ben­e­fits of intel­li­gent plan­ning is the improve­ment of cross-func­tion­al col­lab­o­ra­tion,” says Food. “For busi­ness­es look­ing to improve their cus­tomer expe­ri­ence, Inte­grat­ed Plan­ning can help improve sup­ply chain vis­i­bil­i­ty, allow­ing intel­li­gent iden­ti­fi­ca­tion of issues relat­ed to stock short­ages and capac­i­ty con­straints.”

Competitive advantage

By enhanc­ing sup­ply chain per­for­mance and cus­tomer rela­tion­ships through tech invest­ments in deci­sion-mak­ing, advanced ana­lyt­ics and visu­al­i­sa­tion, Food says busi­ness­es can grow and become more com­pet­i­tive. Indeed, a Gart­ner sur­vey shows that 61% of busi­ness lead­ers see tech­nol­o­gy as a source of com­pet­i­tive advan­tage. Crit­i­cal­ly, these tech­nolo­gies are then used to dri­ve even greater effi­cien­cies across the busi­ness.

Con­verse­ly, Food believes that busi­ness­es that do not invest time and cap­i­tal into improv­ing their vis­i­bil­i­ty and plan­ning for dif­fer­ent sce­nar­ios will strug­gle with cash­flow and even fall by the way­side.

“The ben­e­fits of greater busi­ness vis­i­bil­i­ty can be com­pared to a human’s periph­er­al vision,” he explains. “It allows com­pa­nies to see things they might not have seen before, result­ing in reduced risk, improved deci­sion qual­i­ty and cost sav­ings, as well as improved per­for­mance and stream­lined oper­a­tions.”

For exam­ple, busi­ness­es can opti­mise vehi­cle and dri­ver util­i­sa­tion by lever­ag­ing intel­li­gent plan­ning across mul­ti­ple fleets and oper­at­ing sites.

“To increase accu­ra­cy, it is impor­tant to use the lat­est fore­casts with­in the organ­i­sa­tion and to update plans when new infor­ma­tion becomes avail­able. By com­bin­ing IoT sen­sors, GPS track­ing and edge com­put­ing with exter­nal data sources, it is pos­si­ble to bet­ter under­stand real-world con­straints, enabling opti­mi­sa­tion of large-scale, volatile, and com­plex trans­port plans,” says Food.

Understanding risk 

The plan­ning process often allows busi­ness­es to under­stand risks, mit­i­gate them with some buffers, and then exe­cute accord­ing­ly, Food says. Such flex­i­ble plans mean busi­ness­es will be pre­pared to nav­i­gate tur­bu­lence in times of uncer­tain­ty.

“It is only through use of tech­nol­o­gy that an opti­mised sup­ply chain can be orches­trat­ed by stream­lin­ing and syn­chro­nis­ing oper­a­tions and logis­tics process­es, as well as using intel­li­gent plan­ning plat­forms to analyse and use mas­sive amounts of data,” he adds. 

“This will help ensure the sup­ply chain is aligned with pro­cure­ment, pro­duc­tion, ware­hous­ing and trans­port.”

Tech­nolo­gies like big data, AI, 5G and IoT are enabling col­lab­o­ra­tion and improv­ing com­mu­ni­ca­tion across organ­i­sa­tions. By automat­ing and stream­lin­ing admin­is­tra­tive process­es, busi­ness­es are then free to focus on more strate­gic, rev­enue-gen­er­at­ing ini­tia­tives.

Organ­i­sa­tions are mak­ing huge invest­ments in sup­ply chain tech­nolo­gies. By lever­ag­ing the lat­est tech and try­ing to max­imise those invest­ments, busi­ness­es are in a stronger posi­tion to weath­er the cur­rent dis­rup­tion to the sup­ply chain.