Deloitte and MHI recently published the 2015 annual report titled “Supply chain innovation - Making the impossible possible”.
There are lot of factors which are raising new challenges for Supply chain and hence need for better technology and automation to address those challenges. Some of the issues are
- Customer demand for lower delivery costs
- Customer demand for faster response time
- Rising customer service expectations
- Customer demand for customized products and services
The technologies which will drive next generation supply chains are as follows
- Inventory and network optimization tools
- Sensors and automatic identification
- Cloud computing and storage
- Robotics and automation
- Predictive analytics
- Wearable and mobile technology
- 3D printing
- Driverless vehicles and drones
Inventory and network optimization tools
- Though holding additional inventory is a key strategy to deal with the volatility in demand but that is not enough anymore due to various reasons, cost being one of them.
- By layering in costs and constraints, a company can design networks that deliver orders at the lowest landed cost while addressing defined constraints such as service levels and capacities.
- Key technologies used by companies are around transport optimization (route planning, asset management etc.,network optimization, production optimization)
Sensors and automatic identification
- Auto ID technologies like barcode, RFID and voice, pointe-of-sale systems generate tremendous amount of data which can increase the visibility into supply chain
- Key application areas are Lot tracking (in plant and shipping), Supply chain monitoring, Customer and supplier collaboration as well re-routing
Cloud computing and storage
- Tremendous amount of data generated in supply chain today as well need for agility is driving adoption of cloud both for infrastructure as well as applications.
- Key application areas
- Support operations software, for example supply chain systems,Workforce management systems, support sales and operations,transportation management and spares part management
Robotics and automation
- Use of robotics in manufacturing is well known;however, there is an emerging trend for use of robotics in supply chain including packaging boxes as well machine repairs.
- Key applications for robotics and automation
- packing,sorting orders
- assembly operations in case of multiple product lines
- Companies are focusing more on predictive analytics solutions to look forward rather than traditional look back view. Rather than the traditional sales forecasting use cases companies are looking at integrating internal data with external third party data for advanced use cases like
- Supplier risk management and predictive analytics for force majeure events.
- Using demographics and economic growth data to design supply chain footprint that aligns with future demand
- Monitoring point of sale and accordingly adjust production and replenishment schedules.
Wearable and mobile technology
- Mobile devices like tablets have gained significant adoption in supply chain, however wearables have great potential.
- Some of the potential application areas include
- Field installation and repair of complex equipment
- Receiving inventory for validation and storing
- Routing, tracking, expediting, and exception handling
- Visual inventory cycle counts
- Visual picking of eCommerce goods in fulfillment centers and in the store
- Equipment maintenance and calibration
- 3D printing is set of collective technologies which can create complex designs in shorter period of times and hence increase the speed to market. 3D printing also leads to lower costs over period of time as well as reduced waste.
- Some of the key application areas over and above the traditional use cases like product prototyping
- Service parts designs
- Complex product design, for example Hershey initiative to create 3D chocolate printer.
- Fashion products with high volume lifecycle
Driverless vehicles and drones
- Supply chain is not new to driverless vehicles especially in material handling however drones and driverless vehicles have yet to hit the mainstream use case.
- Some of the potential application areas
- Retail delivery: last mile delivery of orders
- Field monitoring and use cases like oil spill detection for oil and gas industry
- On site transportation
You can download the full report at
Go to the link
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