By Sam Mire
Supply chains are the unsexy, essential systems that make the world of commerce run. Regardless of where you shop, odds are that the goods you buy traveled along some sort of supply chain. We simply can’t do without them. But supply chains are changing, mostly for the better.
These industry insiders shared their insights on the trends most shaping supply chain management. Here’s what they had to say:
1. Bill Leedale, Senior Advisor, IFS
“In terms of trends shaping supply chain management in 2019, additive manufacturing and blockchain are grabbing a lot of headlines. But risk management will probably be of interest to more supply chain organizations. People will be looking for software systems that keep supply chain data secure and identify suppliers whose ability to deliver is at risk. Robotics and other automation that help with the flow of goods and services will see a surge of interest as executive teams seek ways to make their operations more autonomous.
Companies will also be interested in alternate ways of planning that shorten the replenishment cycle time. That is why demand-driven materials requirements planning (DDMRP) is hot right now. Setting up inventory buffers at key parts of the value chain can protect your ability to deliver orders that materialize suddenly without being on the forecast. Giving a company the ability to accept those orders is one way for supply chain management professionals to contribute to top-line revenue.”
2. Marcin Fic, Vice President, Supply Chain Solutions at Flex
“Some key trends are, regionalization, which is occurring for a number of reasons, namely technological developments that are bringing production and manufacturing closer to the final destination of goods – the end user; a shift towards services over products; the expense of global expansion by multinational corporations; and China’s decreasing reliance on foreign parts. An increased customer demand for customized products is also shaping how supply chains are managed. Not only is there a demand for more tailored product, there is also an expectation that manufacturers will match the Amazon speed standard of 48-hour delivery. The higher costs of raw materials, fuel in particular, also contributes to the need for a restructured manufacturing model. By moving towards a regionally based supply chain, manufacturing companies are able to address these pain points. The goal of regionalization is to tackle these issues and contribute directly to the host country’s economy, while simplifying the act of shipping parts and supplies from country to country during the manufacturing and assembly process.”
3. Andy Borchers DBA, Professor and Associate Dean for Undergraduate Programs at Lipscomb University
“One big trend is a rapid move to a digital future. Utilizing IoT (the Internet of Things) firms can know exactly where their inventory is all of the time. New software systems will replace older legacy systems and generally improve efficiency.
A second trend comes in automation. Autonomous vehicles and automated delivery systems will deliver packages to customers with little human intervention. Indeed, the first trials of long haul trucking of mail are happening right now. FedEX, Amazon, the US Postal Service and UPS are all working on automation of delivery.
A third trend comes in how the supply chain function is organized. Firms are increasingly turning over various supply chain functions to specialized firms.”
4. Pervinder Johar, CEO of Blume Global
“In 2019, the most agile and resilient supply chains will be the most successful. Natural disasters, economic flux, and rising tariffs will remain a concern for the supply chain industry and therefore, the C-suite may reconsider its current manufacturing strategies and its global oerations. To help inform these decisions, companies should combine external and internal data. Predictive analytics uses historical data and machine learning to identify and anticipate certain outcomes that become increasingly valuable as the volume of data increases. When properly analyzed, this data will help identify patterns and areas for optimization, to fuel better planning and resource utilization.”
5. Stephen Bindbeutel, Director of Product Solutions at Truckstop.com
“Location data and its application into supply chain technology. The ELD mandate has 1) increased comfortability, albeit by force-of-law, for many industry-participants with sharing data to increase operational effectiveness and 2) created this new fountain of rich, timely, and quality information that could be used to improve countless areas of the supply chain.
With so many parties involved in a single shipment, the question of data rights and ownership is continuing to grow. Finding a balance between deriving value from sharing data and maintaining a certain level of data privacy is THE technology challenge of 2019.”
6. Olivia Montgomery, Senior Supply Chain Management Analyst, Software Advice
“The trends seen in supply chain management in 2019 are all symptoms of an underlying philosophical shift. Disruptors like blockchain and AI are being incorporated at every turn, but why? The answer is simple: supply chain management has shifted from being an operational necessity to being a key component in customer experience.
Consumer demands for quick delivery and transparency in product sourcing are forcing major industry innovations. Supply chain leaders are now assuming integral strategic business roles, partnering with IT and marketing executives, to find solutions. They’re no longer seen as just an operational necessity, businesses are now relying on their supply chains to keep them competitive.”
7. Colin Hayward, CEO of Chinsay
“The trends that we see more and more within supply chain are the need for transparency and traceability, and an increased appetite and willingness of adopting new technology, such as Blockchain, Machine Learning and AI. The need for data extraction and aggregation is also a very important new trend within the industry.”
8. Manav Garg , CEO and Founder of Eka Software
“There have been many trends emerging from the beginning of this year, notably all of them related to automation. Blockchain, Machine Learning, AI, RPA and digitalisation are amongst the top. The industry is turning towards technology that can streamline processes and software congruence. The latter has become one of the most important shifts of the industry as businesses understand the cost reduction and efficiency increase brought by the elimination of manual work and communication between siloed data.”
9. Rob DeStefano, Senior Product Marketing Manager for Ivanti Supply Chain
“Faster delivery is driving so much of the trending conversation on supply chain. Two-day, to next-day, to same-day, 2-hour, etc. The business of getting product into the hands of a buyer in less time is evolving at an incredible pace. It’s changing the traditional shopper journey in retail, the service level agreements in distribution, and the operations of courier services big and small. Couple this with labor shortages in areas like trucking, and businesses are turning to a wide range of innovation to keep up with the demands.”
10. Abe Eshkenazi, CEO of The Association for Supply Chain Management
“Companies are increasingly realizing that including the supply chain function in the C-suite and on the board of directors unlocks unparalleled competitive advantages. Chief Supply Chain Officers (CSCOs) are globally minded leaders with strategic thinking, continuous improvement, risk management, customer service and corporate social responsibility skills. This makes them uniquely positioned to create essential connections with every corner of a business. The growing demand for this expertise is creating more career opportunities at all levels and growing the value of industry roles. ASCM research shows that about 25 percent of U.S. supply chain professionals were promoted last year, and more than 90 percent received a raise.”
11. Chris Crane , Co-Founder of Scout
“Just as sales organizations have transformed through the new abilities to see, understand, and manage pipeline via CRM software innovations, supply chain and procurement teams are experiencing a similar transformation. With modern, user-friendly applications explicitly built for procurement and supply chain teams, these organizations can add critical capabilities and infrastructure to drive visibility and collaboration across the entire enterprise. These trends of digital business initiatives and the fully digitized business help make the enterprise lean, agile, and effective, ultimately driving increased profitability.”
13. Madhav Durbha, Ph.D., Group Vice President, Industry Strategy at LLamasoft
“As tradewars and tariff uncertainties continue, nearshoring, or transferring business to a nearby country, will take hold– opening up new opportunities in reducing “just in case” inventories through postponement strategies, reduced lead times, acceleration of automation, and more. In addition, we’ll see increased efforts in sustainability by reducing single use plastic and packaging.
There will be more surprising partnerships as retailers strive to better utilize their floor space and increase traffic, like Kohl’s now accepting Amazon returns. As labor shortages continue in the US trucking industry, carriers–especially smaller ones– will be increasingly exposed to any slowing down of the economy.”