The supply chain industry is no stranger to disruptions. Frequently at the crossroads of trade wars, global politics and national policies, the industry has over time evolved strategies to mitigate negative business impacts.
However, the pandemic outbreak has put their crisis management skills to the test. In the beginning, strict lockdown implementations meant taking urgent measures to ensure business continuity. Measure like redistributing inventory away from quarantine zones and supplying employees with PPE gear are only a short-term solution.
Strengthening the Supply Chain Digital Backbone
To overcome the current crisis and to mitigate the impact from any future shocks, the supply chain ecosystem should invest in new-age digital solutions.
But not all digital solutions are created equally. While some are essential to tide over the ongoing crisis, a few others can help make the supply chain more resilient.
Draup analyzed these crucial supply chain transformation solutions to identify the right opportunities for service providers.
Digital Solutions to Keep Supply Chain Running During a Crisis
As per our analysis of the current supply chain ecosystem, analytics-based solutions have emerged as a major asset to survive the pandemic.
Organizations that integrate data-driven decision-making can look at current and historical data to make faster, insightful decisions. This helps them to identify and quantify risks and act quickly during times of great disruptions.
Keeping this in mind, we explored some digital solutions that are finding use in the supply chain value ladder.
Seamless Procurement with AI/ML Intelligent
Finding the right supplier is the most business-critical aspect of supply chain. COVID-19 has exposed several chinks in the supplier’s armor. Suppliers who have their manufacturing facilities far away, are really struggling to meet demands right now.
Using intelligent data-backed tools, procurement managers can identify and shortlist suppliers who are perfectly positioned to continue business even during times of great disruptions.
From spend analysis to contract management and supplier risk management, AI helps to significantly improve the procurement process.
Using ML, managers can track and highlight anomalies in merchandise pricing and even classify suppliers into categories and subcategories. This level of classification is crucial for inventory management as well.
Warehouse & Inventory Management
Smart warehouses where the entire supply-demand cycles are governed by AI are gaining huge traction. With COVID-19 removing manpower from warehouses, such solutions are looking increasingly tantalizing.
AI optimizes warehouse logistics with detailed stock forecasting and management to finetune material handling. The operator factor is almost entirely removed.
Slotting software powered by ML algorithms are offering insights into SKU strategy based on sales histories and forecasts.
Computer vision with cameras placed around the warehouse helps managers track end-to-end product movement minus workforce.
In the MHI Annual Industry Report 2020, only 12% of respondents are currently using AI technology. However, more than half of them agree that AI has the potential to disrupt supply chain management.
Hitachi AI Technology concluded a test run at a warehouse where they achieved 8% work reduction.
Logistics Optimized for Demand
Route optimization using AI is gaining traction in the logistics domain. It helps companies to ship faster and for cheaper. AI analyzes the existing route and performs route optimization to minimize stoppings and to avoid routes with traffic.
Demand prediction is another aspect of logistics that AI has upended.
SynergyLabs AI solutions developed an Artificial Intelligence Network to create a high-profile demand forecasting platform that can predict a range of parameters. As a result of this network, their customer was able to keep operations synced across their 15 distribution centers. Even during peak festival season, there were no shortages or holdups reported.
Digital Solutions to Thrive in a Post-COVID World
Evidently, data-driven approaches are at the crux of all digital solutions. We’ve already covered the usefulness of collecting and analyzing data to make optimal decisions. Now, we will go a step further and invoke the power of intelligent algorithms and AI solutions to create a robust supply chain ecosystem.
To thrive in a post-COVID environment, supply chain companies need to invest in more cutting-edge digital solutions.
IoT interconnectedness: The constant stream of data generated by IoT-enabled devices is critical to ensure smooth field operations even when physical access is restricted. IoT can be used to:
- Authenticate the location of goods
- Monitor live storage conditions
- Identify bottlenecks and streamline the movement of goods
- Asset tracking and management
Even within a warehouse environment, IoT is helping managers with logistics and inventory planning.
Predictive Analytics: From forecasting inventory to charting ideal shipment routes, predictive analytics has been in use in supply chain for a while now. Some companies are using it to identify last-mile delivery locations that are optimized to reduce carbon emissions. Post-COVID, predictive analytics is here to become a mainstay and expand applications to other areas like transportation management systems and AI-enabled demand forecasting.
An industry observer noted that predictive supply chains achieve a higher return on their investment and can reduce their inventory by 20-30% due to accurate demand predictions.
Predictive Maintenance: Critical infrastructure breaking down when you need it the most can be prevented with the power of predictive maintenance. By improving equipment uptime this way, companies can be better prepared for a future COVID-like scenario.
Autonomous Robots: Assign mundane repeatable tasks to robots and free up crucial manpower. Autonomous robots are also less error-prone and are proven to increase efficiency and productivity.
The warehouse robotics market is also expected to grow almost 12% between 2019 and 2025, reaching a value of $6.3 billion by 2025, according to our analysis.
A Warehouse of Opportunities
Next-gen digital solutions are finding increased adoption across industries. The supply chain industry must evolve and adapt to the changing customer demands while still being ahead of potential disruptions.
Draup for Sales assists major service providers identify the initiatives of enterprises to accelerate their supply chain workflow. Our account intelligence & real-time signals tracking capabilities help in plotting the right technology opportunities for service providers across the value chain.