The Future Of Supply Chain Management
Modern businesses, regardless of industry, are moving from an outdated linear supply chain model to a new paradigm that leverages technological tools to improve visibility, forecasting, and stock management. Let us introduce you to the key technologies and practices that are driving this shift, and what they can offer for you and your business.
Traditionally, supply chains have operated in a linear network made up of parts that operate largely independently. This structure suffers from several issues that prevent optimization and reduce efficiency.
Linear supply chains often employ an outdated silo approach that involves each link in the chain operating either independently or with limited collaboration with its immediate neighbors. Instead of freely sharing information to build a clear understanding of the company’s needs from one end of the supply chain to the other, each link in the chain works with incomplete information that often changes, interfering with efficiency and increasing operating costs.
This approach misses the fundamental understanding that different parts of the supply chain are dependent on each other in complex ways, and that each link contains knowledge, expertise and information that could greatly improve the ability of other parts of the chain to operate effectively.
To combat this problem, modern supply chain management has recently evolved toward a much more collaborative model that prioritizes information sharing, driven in part by the development of smart technology that allows rapid recording and processing of large datasets.
A New Supply Chain Paradigm
In the last few years, industries have seen a shift towards using advanced digital tools and technology to develop a deeply connected and highly resilient supply chain. This approach leverages data-gathering across the entire network to create predictive models that drive strategy development, as well as using automation and optimization tools to streamline performance.
Recently, many businesses have benefited from data-driven software tools that are being used to gather large amounts of performance data in different areas of the business and harvest them for insights into risk and opportunity. This creates a rich source of information that can be used to drive strategic planning.
To get this data, industrial automation tools are being deployed that use IoT (Internet of Things) technology to continuously record data on equipment health and process performance, storing it in cloud-based servers that can be securely accessed from any geographical location.
This decentralized data can then be operated on by advanced machine learning algorithms that look for ways to optimize the performance of the business and spot opportunities for improvement. When both data and machine learning algorithms are deployed on the cloud, parallel computing power can be leveraged to massively speed up data processing and generate useful insights extremely fast.
Having this type of aid enables managers to react to important signals in data gathered from all over their businesses, compare these signals to historical data and predicatively model future outcomes based on different actions they take right now.
With the advent of data-driven analytics and modelling tools, managers and operators are being provided with real-time visibility into key performance and health indicators, no matter where on the planet they are located. With the recent availability of 5G networks, massive amounts of low-latency data can be recorded and processed in record time, powering live dashboards that update on a moment-to-moment basis.
Warnings about equipment health and performance can be broadcast to off-site personnel or even generate automatic orders for parts replacement, and information about potential opportunities sent directly to travelling business managers on their personal laptop or phone.
Robotics and Automation
Recent advancements in robotics and industrial automation tools provide unprecedented opportunity for predicting and mitigating risk as well as optimizing process performance. Automation tools can react incredibly fast to shut down expensive equipment when they are put at risk by a developing fault or human error, and can even manage the switch to backup equipment or alternative production pipelines when something goes wrong. This can enable production to continue uninterrupted in circumstances that would previously have resulted in a temporary shutdown.
That’s only the beginning. Robotics and automation can assist across the entire supply chain, including inventory management, data distribution, spotting errors and trends in all kinds of datasets, and notifying relevant personnel with clear, concise information when events occur.
The Human Element
With advanced technology changing the way businesses operate, many people are worried that their jobs will be taken over by robots and they will be made redundant. While this fear is sometimes overblown, it is true that many types of dangerous, repetitive, and mundane tasks will be transferred to automation in the coming years.
But what will not change is the requirement for the human element in virtually every part of industrial plants and businesses. Computers and robots are best at doing jobs that have clear boundaries and consistent parameters. Most jobs are never completely routine, since unexpected events can necessitate a different course of action to what a robot or automation software is programmed to do. This means that people will continue to be needed to make the final decision in many areas, and robotics will serve as an aid to their creativity and thought processes.
Regardless, the modern workforce is not the same as it was decades ago. For many different reasons, the days of a person working at a single job for an entire career have been dwindling for some time. Modern workers in both blue-collar and white-collar jobs are well advised to continually update their knowledge and diversify their skills, not just because of the risk of technology taking jobs, but also to continually increase the value that they provide to the company and improve their career prospects.
Advanced technologies are revolutionizing the way that businesses and supply chains operate, providing new opportunities for reducing risk and optimizing productivity. Implementing modern supply chain management will position your business well to take advantage of the opportunities and meet the challenges of the future.
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