First of all, from the logistics situations during the past years, we can identify the 11 trends in supply chains to expect in 2023 as follows.
Artificial intelligence and machine learning
Technological advancement has boosted the wide use of artificial intelligence (AI) and machine learning in different industries. According to a report by Blueweave Consulting, the global market for AI in supply chains was valued at USD 5,610.8 million in 2021. This number is expected to reach USD 20,196.6 million by 2028, with a compound annual growth rate (CAGR). The application of AI in demand and sales forecasting, and product inspection, is one of the major trends in supply chains in the coming years.
AI can bring huge benefits to the business:
- Aid businesses in automating decision-making and customer service,
- Locate the best suppliers for you to build rapport,
- Optimize and automate inventory flow to keep your business running smoothly with little to no human involvement,
- Help businesses save a ton of time and money while also providing amazing returns on investment.
Data is crucial for businesses to make strategic decisions on supply chain management. Most companies keep track of this vital information on spreadsheets. However, for a complicated supply chain with a mountain of data to manage, this approach is no longer suitable. Most industries are currently aiming for smart automation with less human participation in management while still achieving better results.
74% of supply chain executives rate advanced analytics as the second most crucial supply chain technology. With advanced analytics, you can view your whole supply chain, including its advantages, weaknesses, and pain points.
Advanced data provides you with actionable insights that you can:
- Utilize to improve your process efficiency and back your decisions;
- Improve your key performance indicators and maximize your assets.
Digital supply chain with IoT
The internet of things, or IoT, is an interconnected network of computing devices, mechanical and digital machines, objects, animals, or people that are given unique identifiers (UIDs). IoT can transfer data over a network without the need for human-to-human or human-to-computer interaction. Nowadays, IoT is so widely used that there will be 55.7 billion connected devices on the market by 2025, International Data Corporation (IDC) experts said.
IoT benefits businesses in several ways:
- Provide a real-time glimpse into how their systems function, everything from machine performance to supply chain and logistics issues;
- Can automate procedures and cut labor costs;
- Lower manufacturing and delivery costs, increase consumer transaction transparency.
- Moreover, integrating IoT with essential business applications like business intelligence software will enable you to make data-driven decisions about the supply chain.
Supply chain agility
The global COVID-19 pandemic outbreak increased the demand for necessary personal protection equipment (PPE). This attracted thousands of businesses to join the market and become suppliers or manufacturers. These businesses gathered raw materials and manufacturing equipment in a few weeks or just a few days, manufactured new products, and created a market that hasn’t existed before.
The ability to adapt quickly to uncertainty helps businesses survive in such fragile situations. Nowadays, when climate change gets more severe and international trade faces more difficulties, businesses have to become agile more than ever to stay competitive and thrive.
Supply chain resilience
Supply chain resilience is defined as the adaptive ability to anticipate unforeseen circumstances, react to interruptions, and recover from them. The three main elements of a successful supply chain resilience strategy are people, processes, and technology.
Businesses should look for skilled supply chain managers, procurement specialists, and engineers who can bolster the company’s personnel and guide them through a challenging environment. After that, structure your team with one for managing commodities and another for managing suppliers. Your people should always get aware of new items, advancements in the supply chain, price adjustments, and other market activities.
Following people, the working process also plays a vital role. If employees are supported by reliable, efficient systems, they will perform at their highest level. Companies need to strengthen their processes in forecasting, inventory control, supplier management, and market research to boost supply chain resilience.
Technology can help all the mentioned processes to be completed more quickly and precisely. For instance, enterprise resource planning (ERP) and electronic data exchange platforms can offer baseline data to justify expenditures in purchasing, human resources, etc.
Besides, they offer rich data sets for managers to:
- Understand the procurement dynamics,
- Make decisions about customer needs, production schedules, logistics, and delivery requirements,
- Anticipate upcoming difficulties, such as shortages and respond swiftly to market shifts.