In the fast-changing world of supply chain management, a big question is: How can companies stay ahead and use digital chances? New technologies are changing the supply chain scene. Being ready and having a clear view is key to success.
By taking on new trends, moving to a digital setup, and using good data, companies can see more clearly. They can be more ready for future supply chain problems.
Key Takeaways
- 50% of supply chain organizations will invest in AI and advanced analytics applications by 2024.
- Low-touch planning can enhance ROE by 2-4 percentage points and add 1-3% to gross margins.
- AI-equipped supply chains are over 67% more effective with reduced risk and lower costs.
- The market for supply chain analytics is projected to reach $13.5 billion by 2027.
- Over 75% of companies plan to adopt big data, cloud, and AI features in the next 5 years.
Trends in Supply Chain Optimization
Generative AI in Supply Chain Operations
Generative AI (GenAI) is changing how we manage supply chains. It can handle huge amounts of data and learn complex things. This helps with things like making sure we follow rules, making production smoother, and talking to logistics teams online.
Opportunities for Generative AI
Big companies are using GenAI tools to make planning easier and manage risks better. They use GenAI to predict demand, find the best routes, and plan for different scenarios. This makes their supply chains work better and be more reliable.
Key Actions for 2024
To use GenAI well, planners need to get better at analyzing data and working with others. Companies should focus on making smart decisions and use data to guide them. They should also work with tech partners and experts. By 2024, 50% of supply chain organizations will invest in applications that support artificial intelligence and advanced analytics capabilities.
Supply Chain Trends: AI-Enabled Low-Touch Planning
Old ways of planning in supply chains can’t keep up with today’s complex needs. But, AI-enabled sales and operational planning (S&OP) and integrated business planning (IBP) offer hope. These tools aim to cut down on manual work and use advanced analytics to solve complex problems with less human help.
Benefits of Low-Touch Planning
Low-touch planning brings better predictability and higher profits. It also frees up resources for tasks that add more value. By automating planning, companies can see their Return on Equity (ROE) jump by 2 to 4 percentage points. They can also boost their gross margins by 1 to 3 percent.
Key Actions for 2024
- Planning pros need to get better at analytical modeling, working across teams, and building relationships.
- Companies should treat decision-making as a key business skill. Start with clear goals and mix human insight with data.
- Building a network of tech partners, business integrators, and experts is key for AI low-touch planning success.
By taking these steps, businesses can tap into AI’s power for better supply chain management. This can lead to real improvements in how they operate.
| Benefit | Impact |
|---|---|
| Improved Predictability | Enhanced Return on Equity (ROE) by 2 to 4 percentage points |
| Enhanced Gross Margins | Added 1 to 3 percent to gross margins |
| Freed Resources | Focus on value-adding activities |
The Critical Role of Data Management
Data is a big challenge in supply chain management today. The rise of digital tech, IoT devices, and tracking systems makes it harder. To solve this, supply chain experts need to handle their data well. They should focus on data availability, quality, cadence, and consistency to make better decisions and improve operations.
Addressing Data Quality Issues
Using a use case-driven approach can help tackle data quality problems. This means setting up good data governance, access controls, encryption, and regular audits. It ensures data stays private and secure.
Key Actions for 2024
- Focus on data availability, quality, reliability, cadence, and consistency.
- See data management as a continuous journey and take it step by step.
- Create a roadmap that links data to value and purpose.
Improving low-touch planning can boost Return on Equity (ROE) by 2 to 4 percentage points. It can also add 1 to 3 percent to gross margins across revenue, cost, and assets.
Enhancing Supply Chain Visibility Beyond Tiers 1 and 2
The lack of visibility in supply chains is a big problem. It makes it hard for companies to follow rules and find and fix risks. Seeing beyond Tier 1 helps companies understand their whole supply chain better. They can find the real causes of problems, spot new risks, and work towards ESG goals.
Tools like control towers and digital twins help a lot. They show important relationships with sub-tier suppliers and help see the whole supply chain. These tools help companies work together and use data to get a clearer picture.
Key Actions for 2024
- Embed ESG measures within the technology for improved procurement decision-making and performance management
- Leverage data-driven insights to identify and mitigate supply chain risks beyond Tier 1
- Collaborate with partners across the extended supply network to enhance visibility and transparency
- Integrate execution processes with planning to enable real-time adaptation to changes
By looking deeper into their supply chains, companies can learn more about their networks. They can meet rules better and support sustainable practices. Using the right technology and working together are key for success in 2024 and later.
Conclusion
Supply chain optimization technology is changing the game for businesses across many industries. It brings better visibility and agility, giving companies a big edge in today’s fast market. With tools like generative AI and AI-enabled planning, businesses can predict demand better, offer on-demand services, and manage their operations smoothly.
Using these new technologies helps companies avoid disruptions, make customers happier, and grow their profits. As AI in supply chains is set to hit $41.23 billion by 2030, it’s clear that these technologies are key for staying ahead. Over 75% of companies say big data, cloud computing, and AI are vital for handling today’s supply chain challenges.
We see even more progress coming in areas like self-driving cars, robotic automation, and supply chain services. These advancements will make supply chains more efficient, save costs, and be more resilient. By keeping up with these trends and investing in optimization, businesses can thrive in the changing global market.
