Top 5 Drivers of Supply Chain Innovation
The modern supply chain has progressed leaps and bounds from traditional practices due to intense competition in this sector. With products increasingly becoming commodities, competitors are finding it difficult to differentiate their products. Thus, companies are looking forward to optimizing their supply chain to achieve a competitive advantage. Advancement in technologies, cloud computing, and availability […]READ MORE >>
The modern supply chain has progressed leaps and bounds from traditional practices due to intense competition in this sector. With products increasingly becoming commodities, competitors are finding it difficult to differentiate their products. Thus, companies are looking forward to optimizing their supply chain to achieve a competitive advantage. Advancement in technologies, cloud computing, and availability of big data are enabling supply chain managers to optimize their supply chain. In order to achieve greater profitability, increased revenue, and improved service, companies are looking for new technologies and practices, which will drive supply chain innovation.
Internet of Things (IoT)
Supply chain management is a nightmare task for an organization with millions of products, thousands of suppliers, and hundreds of logistics partner. An interconnected IoT system can automate the coordination between all the process and partners. For example, an image recognition software can identify a product in the inventory, and when the stock gets low, it can automatically place an order to the supplier and receive the item.
Complexity of Compliance Environment
Today’s supply chain must deal with increasing number of compliance issues following numerous regulations and guidelines. A supply chain optimized for a particular product or an industry may face difficulty when serving a new vertical. Manually trying to figure out ways to abide by such regulations could eat up valuable time. So, the industry is looking for automation and machine learning to drive supply chain innovation in this field.
Advanced Collaboration Platforms
Optimizing the supply chain goes beyond just internal optimization of supply chain processes. Advanced collaboration platform enables the company to share valuable information across multiple tiers of manufacturers and suppliers. This allows companies to share forecast data with suppliers and obtain their responses in real time. Such innovations help businesses and their suppliers improve transparency and strengthen relationships.
Big Data and Analytics
A typical supply chain can generate an enormous amount of data across multiple parameters. A single item is capable of generating data across all parameters, which poses a problem of storage and analysis. Big data and analytics are driving supply chain innovation as organizations try to figure out performance measurement metrics and set benchmarks in the area of perfect order management, cash to cash cycle, fill rate, inventory turnover, and inventory velocity.
SCM Outsourcing and Rationalization
Many SCM services have emerged in recent times specializing in select supply chain functions. Apart from this, 3PL and 4PL services are in fierce competition to win the business. With the advent of so many service providers, companies have to identify partners who can provide strategic value to their business.
Want to know more about how to optimize your supply chain?
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