The 5 Biggest Trends In Supply Chain Technology In 2020
Companies face continual pressure to reduce costs and increase product quality during manufacturing. They need to streamline their supply chain processes through the adoption of new technologies. These include things like Artificial Intelligence, digital supply chain twins, or blockchain.
Many supply chain managers see the adoption of new supply chain technology as an advantage over competitors. Let’s take a deeper look at supply chain technology and its five biggest trends.
What Is Supply Chain Technology?
A supply chain is a network of all the processes a company takes to bring a product to a customer. This includes manufacturing, transportation, distribution, marketing, and customer service.
Companies optimize their supply chains by implementing new technologies. These technologies lower costs and speed up the production cycle.
Companies are using new supply chain technologies to gain an advantage over their competition. With the advent of Artificial intelligence, robots, and the Internet of Things (IoT), companies can now leverage automation and big data to provide long term company success.
Why Is Supply Chain Technology Useful?
Supply chain management is vital because of globalization. Companies often need to oversee the production of their products in one country and distribute them to another. This is a complex process, which needs more accurate and efficient technologies.
Supply chain managers face many challenges. They must minimize any production delays to satisfy their customers. This includes monitoring factories, warehouses, and transportation.
They need to ensure that their supply chain data is secure and ensure that they have adequate tools to address any cyberattacks. Companies could suffer huge losses if their supply chain has a data breach.
Supply chain technology addresses the issues of security and streamlining. It can provide more transparency of information between links in the supply chain. Also, it can analyze big data to optimize processes and reduce transaction costs.
5 Top Trends In Supply Chain Technology
3D Printing
Companies build factories to manufacture products. They install immovable equipment and buy large parcels of land. This costly process has been necessary for manufacturing for a long time, but 3D printing changes this.
There are now cheaper, high-quality materials as well as AI-driven design software. 3D printing is an attractive option for manufacturing. 3D printers are also more mobile than traditional manufacturing equipment. This means that companies can set up product assembly hubs in local areas to reduce logistical costs.
3D printers also need less space, meaning that companies do not need to purchase as much land. It also reduces air pollution because it minimizes the need for large equipment that produces harmful emissions.
Artificial and Augmented Intelligence
Engineers created Artificial Intelligence (AI) to replace humans in completing certain tasks. AI can filter through client lists, verify transactions, or even manufacture products using machines.
Augmented intelligence is like AI. It is meant to operate in cooperation with workers to enhance and streamline their work processes. For example, it could calculate vehicle routes and determine the most effective logistical plan while a worker communicates with drivers.
It can be laborious for managers to run performance checks and monitor inventory. Through algorithms and predictive methods, AI can collect and interpret data to automate these processes.
This leads to improved delivery times and optimized inventory management. For instance, AI can sort through the storage capacity of all warehouses in the supply chain and determine which of them requires optimization.
It can also make sorting through inventory a more efficient and seamless process. With AI and machine learning algorithms, companies can easily sort through large amounts of data and gather valuable insights.
Of course, managers control the AI systems, so they can create specific protocols that the AI executes. This means that managers can save time and focus on more important tasks.
Artificial intelligence is quickly becoming one of the biggest trends in supply chain technology. The IDC even predicts that by 2021, half of all manufacturing supply chains will have invested in AI.
Blockchain
Blockchain technology verifies data on a distributed ledger. This is a network of computers that solve algorithms to add entries to the ledger. The ledgers contain different sets of data from transaction records or client credentials. Each time a computer verifies an entry, a “block” is added to the chain.
They are stored chronologically, so new blocks are linked to previous blocks. The chain ensures that blocks cannot be edited without altering a previous block. For example, if a person wanted to delete a transaction, they would have to edit all previous blocks in the chain. This is time-consuming and would raise alarms on other computers in the chain.
Companies can use blockchain technology to complete and verify transactions autonomously. The blockchain also provides a secure record of data for companies to refer to when auditing clients and financial records.
For supply chains, blockchain technology is incredibly useful. It can assist track-and-trace applications so that companies can easily log the movement of goods. This can prevent leaks, identify at-risk suppliers and fraud, and show that regulations are being met. This improves the overall security of the supply chain.
When used together, AI and blockchain could also securely verify and execute tasks in a supply chain. For example, AI could verify a customer’s product order and deliver it to a truck, with no need for human verification.
Internet of Things (IoT)
The Internet of Things is a fast-growing supply chain technology. For manufacturers, it can support operations and allow for better management of assets.
IoT devices record and send data to various systems in a supply chain. Workers and managers can monitor a machine’s work through a digital supply chain twin or an AI system.
By providing real-time data to workers, companies can use this technology to track shipments seamlessly. It also helps to reduce misplaced or lost inventory as it enables managers to monitor the logistics journey better.
With the Internet of Things, companies can reduce risk and boost revenue at the same time. Unfortunately, IoT increases the risk of cyberattacks. So, companies using this technology should also focus on improving their cybersecurity.
Digital Supply Chain Twins
Supply chain managers have large stores of data from IoT devices. They also have electronic transaction records, logistic data, and digital models of manufacturing equipment. They use this data to create a digital supply chain twin, which is a digital copy of a company’s real supply chain.
This combines physical and digital worlds. Companies can engage with and test the digital versions to see how certain scenarios would play out.
A digital supply chain twin can give managers an overview of the entire supply chain. This includes which factories have a higher production rate or the efficiency and failure rate of machinery. They can monitor, interpret, and analyze these processes digitally to streamline the real supply chain.
Additionally, managers could see a supply chain’s performance without combing through reports and records. They have a real-time model that changes as the real supply chain changes. This means they can dynamically analyze their supply chain changes.
Final Thoughts
There are so many new technologies on the rise. Supply chain managers should consider investing in some of them to optimize their processes. The adoption of AI, blockchain, and IoT could effectively boost a company’s efficiency. But, this requires managers to embrace innovation and change.
These supply chain technologies can streamline the financial aspects of the supply chain and make data management easier. So, by investing in these new technologies, companies can improve their supply chain management while staying ahead of the competition.