Five Key Supply Chain Trends for 2017

5-Key-Supply-Chain-Trends-for-2017

SCM world recently completed its annual “Future of Supply Chain” survey comprising opinions of 1,415 supply chain professionals from around the world. Five key supply chain trends emerged as a result.

SCM World is a cross industry learning community, “powered by the world’s most influential supply-chain practitioners.” Their membership includes many large and well-respected global companies.

The survey opened with the following question:

“With respect to supply chain strategy, which of the following technologies are disruptive and important for your company?” The results are shown below. 

5 Key Supply Chain Trends Overview

When these results were broken down five key supply chain trends emerged:

1: 3D printing is making big differences in the healthcare industry.

6% of respondents in 2014 agreed with the statement, 23% in 2015 and 35% in 2016. That’s a six fold increase in the space of two years. Healthcare and Pharma have embraced the technology wholeheartedly, including companies such as Johnson & Johnson. 3-D printing also shows promise in spare parts manufacturing in the aircraft and automotive industries.

2: The benefits of Uberization are being leveraged across a broad cross-section of industries.

Only 8% of respondents in 2014 thought the “sharing economy or Uberization” would have an impact as a potentially disruptive technology for supply chain strategy. However that doubled to 16% in 2015 and produced a more than threefold increase in 2016 at 27%.

Many examples of this are the same day delivery UberRush service that Nordstrom uses, Instacart that Costco and Wholefoods use, and the Convoy and Cargomatic services that connect shippers to carriers.

Industry has started to buy in to the flexibility and agility offered by Uberization and demanded by the consumer. It also offers the industry significant benefit by not having to invest in labor and transport.

3: IOT, cloud, digital supply chain and machine learning are the fulfillment systems of the future for high-tech manufacturers and distributors.

IOT_cloud_digital supply chain_and machine learning.

These are four of the top six technologies on the list. When used in isolation they offer benefit – cost advantages with cloud, precision in operations with IOT, agility with digital supply chain, and speed, efficiency and automation with machine learning.

Used in combination however they can completely transform the supply chain. Amazon are currently disrupting the global logistics and transportation industries with a combination of these very same technologies.

4: Cloud computing has matured and become almost mainstream.

The only meaningful bump in the figure below is CPG & retail which may indicate they are still figuring out the best way to deploy an omni-channel retail strategy. Cloud computing seems to be a proven and successful technology in the other sectors.

Cloud computing

5: Operational technology is catching up to information technology

Information technology equals computers. Operational technology encompasses everything else including advanced robotics, drones, 3-D printing, Uberization and IOT. This operational technology enables new business models that can be more personalized, less resource intensive and higher-margin.

IT vs OT

The extreme, but realistic use case is virtual inventory for maintenance parts in capital equipment situations. Operational technology includes IOT to know what needs to be fixed, 3-D printing or robotics to make the part and drones or Uberization to deliver it.

The logistics industry is being disrupted by each and every one of these technologies and the pace is accelerating. Our good friends Amazon are leading the charge. It’s up to the rest of us to start out-of-the-box thinking, create new business models and new opportunities.

If you’re interested in learning how shipping by rail might better meet your freight transportation needs call New Mexico Transloading at 505 – 908 – 1911. We’d be delighted to have a conversation with you.

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