The Most Relevant Supply Chain Trends In 2021

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A supply chain is defined as the network between an organization and its suppliers to produce and distribute a certain commodity to its buyers. Different people, entities, information, resources, as well as activities, make up this defined network.

In a supply and demand relationship, supply chains are half of the equation. Ideally, an organization is going to desire that their supply chain operation runs as efficiently as humanly possible and will take measures to put that desire into practice. With a well-run supply chain, keeping up with demand is never going to be a real issue.

Introducing automated systems for the management of supply chain processes helps foster market growth by increasing efficiency and allowing the supply chain outfit to keep pace with ever-increasing demands. While many companies have already introduced some form or forms of automated systems into their supply chain operation, often certain features to these systems that are desirable, are not already integrated. Logistic modules development is becoming a modern and leading trend as new modules can be developed to integrate with existing software to add needed functionality that is not already present in an organization’s current ready-made software package.

Supply Chain: Trends and Challenges

Without a doubt, the greatest challenge faced presently by any supply chain is the shifting landscape that globalization has brought along with it. Household brand names, pricing, and features are no longer enough to set aside one supply chain operation from another. In order now for a company’s supply chain operation to gain and keep the edge, just as much focus must be placed on what happens with the processes of a supply chain, as with the products, themselves.

Once the ceiling is reached for higher prices, continuously increasing prices is only going to result in less demand. At this price point, increased profitability may still be achieved but it’s going to take better logistics, with cost-cutting and saving happening along with the different steps of the supply chain process, as opposed to simply increasing product cost.

Maintaining a central focus toward a global supply chain is critical nowadays for a business to stay competitive. By holding this perspective, a company is going to allow itself an edge over every business that does not. This viewpoint is almost mandatory for success in this modern era as there already exists a global network of both suppliers and buyers. Without an international point of view, a business is restricting itself, and businesses that don’t restrict themselves are always going to have a larger share of the market.

Another trend and the subsequent challenge of modern-day supply chains is the push to go green. This is a big concern in modern times and is a worthwhile one. Reducing a supply chain’s greenhouse emissions is great for the environment and as electricity and transportation account for the highest percentage of these types of gases in the US, in conjunction with the fact that a large portion of a supply chain’s process tree involve both electricity and transportation, a giant push is being made for a more environmentally-conscious approach toward logistics for many companies.

Still yet another challenge existing today for supply operations are the shortening of products’ lifespans. With this modern introduction of shortened life spans for consumer products, comes with it the need to be quicker and more efficient. It’s that or be left behind by the supply chains that do.

Technologies are Available

Luckily, this modern era has not just brought along with it the considerable challenges of strengthening a supply chain operation’s position in a global market, being eco-friendly, and adjusting to shortened product life cycles, but it has also allowed for the introduction of new and emerging technologies to help face these seemingly, insurmountable tasks.

• Drones, AGVs, and Robots for Safety and Productivity: Drones are being employed in smart warehouses of today as they are easily able to reach high locations without a ladder and thus, avoid any potential injury that may come to a human employee performing such a task. Drones can quickly scan and monitor items, and as such, are very practical in a warehouse setting.

  Automated guided vehicles, or AGVs, for short, can quickly calculate the shortest routes and restock inventory, without the need for any human supervision. In fact, Amazon is utilizing over 100k AGVs on their warehouse floors.

• Blockchains for Transparency: Blockchains are best known for their use in cryptocurrencies. However, more and more blockchain technology is being used to enhance transparency with supply chain operation processes. This movement, because it is both effective and secure, is not likely going anywhere, nor likely to slow down.

  Blockchains are secure because they are not easily hidden, altered, or tampered with. This is because each transaction to a blockchain must be agreed upon with each ledger across a network. Blockchain ledgers record every transaction that occurs, so even when an item is deleted, there is going to exist a record of who made the deletion and when.

  Blockchains promote transparency, as each transaction has a unique record within the supply chain. As inventory moves about and various information becomes tracked within a blockchain system, visibility is increased. There will exist one central true repository for transaction records. No more of the old, he said, she said my word versus yours. The truth can always be found quickly in the transaction ledgers of the blockchain in use.

• Enterprise Resource Planning Software for Further Automation: Enterprise Resource Planning software can work with both supply chain and warehouse management systems seamlessly to help automate tasks. For example, ERP software, when implemented properly, can easily place orders with applicable vendors, should an inventory’s supply fall below a specified minimum quantity. It is important to utilize end-to-end software testing to ensure a seamless offering is delivered.

Done properly, the implementation of an ERP software system can help raise cost awareness, provide inventory management in real-time, and increase awareness.

Conclusion

In conclusion, numerous challenges are facing the supply chain industries in 2021 that are leading to several new trends. These new challenges consist of mainly competing in a global market, existing as environmentally conscious, and dealing with ever-shortening product lifespans. Fortunately, with the transition of tasks once performed by humans, as well as pen and paper, to newer technologies, with robotics and software, these challenges can be faced successfully. Efficiency can be greatly enhanced by employing drones and AGVs within warehouses, as well as by implementing enterprise resource planning software and blockchain technologies. This greater efficiency can easily lead to greater visibility for a supply chain and ultimately, reduced costs, and increased profit margins, not to mention other benefits, like improved customer satisfaction.