How Technology Can Help Redraw The Supply Chain Map

Technology will undoubtedly help businesses become more agile and agile, reduce costs and errors, increase resource efficiency, and speed up operations and communications. This frees employees from repetitive tasks in roles that require judgment and experience. However, the achievement of any of the many goals of string technologies is possible only when appropriate solutions are applied to specific problems.

“Regardless of their list of priority needs or expected benefits and regulatory constraints…take it to the vendor and ask them what they can and can't do,” Soday says. Vendors have a responsibility to define solutions and test new technologies if necessary. he emphasizes.

Having the right organizational structure in place can improve results and prevent test technology failures from impacting the entire business. Paul Durkin, director of innovation and customer experience at Wincanton, says his company has simplified its technology function by splitting it into two parts. One part examines the challenges facing existing companies, while the other identifies opportunities and products based on new technologies. This, he says, "frees up bandwidth" for product development while keeping existing projects in mind, creating more solutions to customer problems.

Both parts are included in a single whole and are combined to implement the relevant solutions. “There is no technology that does not live up to expectations, but we must be ready to use it as an organization,” Durkin said. He added that people are the key. “In some cases we may be technically prepared, in [other] cases it may be from a human point of view. It's the combination of people and technology that makes it work."

Understand the limits

Even when a technology solution turns out to be right, it is important to understand its potential. “Data-driven artificial intelligence can help [in the short term], but long-term planning becomes more difficult,” says Fint. This is because the unprecedented event [becomes] longer in time. In other words, AI cannot overcome the basics of statistics and predict the unexpected.

“Once the event happens, the software will help you adjust quickly,” Find says. "For example, it can predict how consumer behavior will evolve and take action accordingly." It can also quickly gather information about current conditions such as port congestion, helping companies quickly find alternative products or suppliers.

In the early days of the outbreak, machine learning (ML) could get ahead of humans. As the latest information comes in, ML uses it to find the best answer. ML quickly realized that it didn't feel like the holiday season.

Some customers initially feared that their software would not be able to handle the unprecedented nature of the outbreak. However, a machine understands and interacts with the flow of information faster than a person. AI and machine learning measure expectations against actual results in real time and learn as you go.

When the unexpected cannot be avoided, technology can provide contingency planning to help supply chains cope with shocks. Improves inventory management by incorporating security layers and helps organizations achieve strategic goals such as waste reduction.

Finally, networks can be designed, run, and tested to recover from situations where parts of the chain fail as a result of "aggressive" and unexpected events. It also helps move supply chains from, for example, China to other parts of Asia with improved systems for location, capacity, inventory management and customer response.

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To showcase some of the technologies that could make a difference , this report looks at common points in the supply chain to show the most promising solutions, current and future.

Companies are focusing on what technology does, not what it does, advises Cambridge University's Center for Global Manufacturing. Echoing Soddy, he said the company's strategic goals — better supply, better products, and increased efficiency — should determine which part of the supply chain needs investment and which technologies will be deployed.

IBA Group, a software outsourcing and services company, claims that upgrading facilities can be more efficient, less difficult to manage, and more successful than moving to a completely new infrastructure.

1. Purchase and sale

Procurement and sales are linked, although they are at opposite ends of the chain. Based on actual orders or forecast orders, you will receive materials and supplies to ensure that the needs of ex-employees are met. The more digitized a company's purchasing data is, the better it can be integrated with suppliers. If other providers have similar capabilities, improved communication will increase transparency and responsiveness throughout the chain.

The volume of data related to consumer behavior is growing rapidly. According to this year's Ericsson report, total global mobile data traffic will reach 67 exabytes per month by the end of 2021. This number is expected to quadruple to 282 exabytes per month by 2027.

By integrating data from suppliers and customers, artificial intelligence and machine learning can provide demand forecasts and statistical analysis faster and more accurately than humans. High demand for a new type of product in one area can be identified in advance, and the knowledge gained can be applied in neighboring markets. Data analysis helps track price movements and find cheaper sources.

Supply chain planning is not new, but digital systems allow a wider range of scenarios to be modeled. This helps companies determine the best course of action in the event of a disruption in the supply chain or when alternative suppliers are needed. As it turns out, this type of plan increases flexibility. Companies that maintain quality data will benefit greatly.

Resource resiliency is further enhanced when expected delivery failures are detected through automated monitoring using natural language processing. This may include, for example, using information obtained from the Internet about extreme weather conditions or political events. To some extent, this is already provided by "control rooms". These are cloud-based automated data warehouses that use both manual and automated resources to provide companies with better insights into their supply chain. Observation towers can provide early warning when, for example, an external strike puts a supplier out of action.

Although control towers were already in use, the constant manual entry, the quality of the data within the company, and the security of the transmission prevented it from being fully automated. Projected Area of ​​Strong Growth: According to Grandview Research, the watchtower market will be worth $6.5 billion by 2021, and this valuation is expected to grow at a competitive rate of 20 percent per year from 2022 to 2030.

Automated analysis using natural language processing and machine learning can simplify supplier contracts, provide elements for review or action, and balance and standardize purchase contracts. Similarly, automating repetitive tasks like invoicing can reduce human error and speed up processing times. ML can analyze invoices to prevent fraud.

2. Production

The efficient production of goods depends on an error-free manufacturing process. Equipment failures, resource management and poor planning cost time and money. The aim of solutions in this area is to reduce downtime and optimize the use of time and materials.

Sensors can monitor everything from machine functions to production flow and help companies choose more efficient production schedules. Combined with machine learning, sensors can predict the need for equipment maintenance and indicate a failure of a particular part. Smart sensors can detect quality issues based on discrepancies in data and decide when human supervision is required.

Are you looking for the best factory plan? The digital twin can help. It is used to create virtual copies of existing factories and jobs. It can provide information on the best design, for example when installing new machines.

Bots are one of the mature technologies used in the supply chain. Occupations are becoming more advanced and the use of robots is expanding beyond their traditional focus in the automotive sector. According to the union, robot sales will reach $2 billion by 2021, up 28 percent from last year. This was driven by labor shortages during the pandemic and was 14 percent higher than record sales in 2017. The non-automotive sectors account for 58 percent of the total sector.

3D printing is beneficial for companies that operate in small batches near their end markets. It is popular in small, high-precision industries such as custom medical device manufacturing, aerospace and aviation, as well as in areas where prototypes and parts are made.

3. Transport

As the Internet of Things continues to grow and become more powerful , systems built on mature RFID (Radio Frequency Identification) technology can track goods in transit in real time. This allows you to carefully plan transportation and delivery and highly efficient use of the fleet of trucks or minibuses. Frozen Goods Monitor improves quality control by providing nearly constant temperature readings. By April 2022, according to Hapag-Lloyd, all standard containers will be trackable for several months, making this part of the chain more visible.

Many software vendors offer control towers that integrate third-party data and algorithms to solve traffic problems. This can be especially useful when delays occur: storms and routes can change instantly. In the event of unusual events such as traffic jams, technology can determine alternative routes faster than humans.

However, one problem is that the system still relies on manual data entry. Today, when disasters affect business processes – one example is the closure of the Suez Canal to container traffic in 2021 – companies may need more time to restructure schedules if their operations are not fully automated. The more information a system has, the faster it can improve backup plans. At some point, natural language processing and regular notifications, such as Covid rule changes, should facilitate automated data collection.

AI speeds up everyday tasks like choosing an operator. Logistics planners can help narrow down possible routes. This process is similar to what consumers use to select a flight ticket using Google Flights. Prediction algorithms can ensure that assets like containers are in the right place at the right time. AI improves data analytics, bandwidth estimation, and network analysis.

The Digital Twin uses AI and the Internet of Things to make transport more efficient. For example, sensors in the digital twin of the port of Rotterdam plan loading and unloading schedules based on the flow and weight of the cargo. In the long term, DHL expects digital duplication of all routes to be possible using real-time data. This makes autonomous transport more practical.

Blockchain is said to be able to transform much of the supply chain by making transactions authentic. The promise to resolve the border impasse caused by Brexit has yet to materialize, and with limited evidence of its value or implementation, any widespread approval should be considered speculative.

4. Storage and warehouse management

Warehouses operated by food company Ocado show how integration can add value. Smart home platform systems are being sold to food companies around the world to meet their business needs.

Bots have been adding value to this part of the chain for decades and they are getting better and better. Using sensors, machine learning and artificial intelligence, the robots can load trucks, pallets and crates. Ocado's state-of-the-art warehouses are reducing uptime as bots monitor their "health". At Amazon, robots do everything from heavy lifting to fast and accurate picking and packing.

Inventory levels are based on current orders and expected demand, and this is where AI brings savings. Historical data and sample analysis have helped Ocado reduce food waste. This is two to three percent to 0.4 percent lower than the industry average.

5. The Last Mile and the Client

Last mile delivery can make or break a customer satisfaction rating for a consumer-facing company. In addition to the previously mentioned demand forecasting and shipping readiness methods, software can improve route planning when taking customer orders. For the past few years, street robots have been distributing fast food in London and other European cities. In a few years, we can expect more autonomous vehicles and aircraft to be used.

Fully digital supply chains can not only increase the efficiency of existing businesses, but also increase revenue by focusing on what customers can buy. In shopping, machine learning and algorithms can leverage shopper buying patterns and help sell more products. Having digital sales channels is not only good, but essential for companies to reach and develop products for digitally savvy consumers.

As demand for certified organic products grows, traceability supports consumer-facing companies that are among the early adopters.

6. Risks to be aware of

◉ Internet dangers
Expanded supply chain digitalization is not without risks. Data loss, data security, and hacking are all issues. The 2021 State of the Software Industry Supply Chain Report from supply chain software provider Sonatype predicts that cyberattacks in the sector will increase 650 percent to 12,000 from 216 in 2015.

◉ No expectations
Frustration may be a technology trend, a threat flagged by Gartner Hype Cycle. There is a limited understanding of any primitive technology. Failure to meet the needs of the organization with appropriate technology will inevitably lead to frustration. The benefits offered by the Internet of Things, artificial intelligence and blockchain are not yet apparent to most companies as their benefits are not well understood.

To increase the chances of success, users need to understand that not all problems can be solved with any technology, says Soddy of Bayes Business School in London. “Each of these technologies is good for some, but not for everything… People think that if they get blockchain, artificial intelligence or the Internet of things, all their needs in the supply chain will be satisfied. They really think about what they need. What will the technology bring? to do" and what he does not offer.

Choosing between a homeowner's refrigerator, microwave, and vacuum cleaner is like choosing one that meets all of their needs. "If you buy a microwave to clean floors and turn it on and off to dust off the floor, it might work, but that's not what it was designed for."

The problem is exacerbated by limited data exchange between users. More companies should share their experiences on what works and what doesn't in improving and developing technology applications.

◉ Talent errors
Компании, которые боятся перемен, пострадают от плохого исполнения, если они не смогут заручиться поддержкой внутри организации. Отсутствие тренировок тормозит рост. В некоторых случаях для успешного внедрения может потребоваться смена поколений.

Эксперты подчеркивают важность привлечения правильных специалистов для выпуска нового программного обеспечения. Слишком часто генеральным директорам продают общие решения, которые не понимают своих обязанностей.

результат

Технологии могут помочь преодолеть проблемы в цепочках поставок. Компаниям необходимо знать, какие проблемы они хотят решить, чтобы более успешно их внедрять. Они должны понимать, что любое решение — это инструмент, который должен правильно внедряться и использоваться людьми, обученными его использованию.

Если в цепочке поставок есть проблемы, их необходимо выявить и решить как можно скорее. Даже самые лучшие технологии ничем не заменят коммуникацию и прозрачность. Раннее вмешательство может спасти отношения компаний со своими клиентами.

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