Future of Supply Chain Management

Supply Chain Management is the process or the flow of goods data and finances related to products and services; it is the management flow from start to finish. I.e from raw material to finished product. A typical supply chain that involves physical goods, comprises multiple stages namely raw material procurement, warehousing, logistics, and delivery of raw material as well as finished products.

Supply Chain Management

What is Industry 4.0 and its significance?

Industry 4.0 symbolizes the fourth generation of the industrial revolution. In other words, it reduces human intervention by bringing in automation and sensor-based systems to aid the creation & distribution of goods and services

Industry 4.0 can be described as the trend with industrial automation in manufacturing technologies and processes that includes Industrial IoT, cloud computing, artificial intelligence, and other Cyber-Physical Systems, thus making an enterprise that communicates, analyzes and uses the information to further drive intelligent actions in the manufacturing process.

Supply Chain Management

What has slowed down innovations in the Supply Chain Management sector?

Geopolitical considerations

Innovations in Supply Chain management cannot be fully leveraged if the implementations are not cross-border. Industrialized countries like China or the US will have robust supply chain networks, spreading across the country. Facilities like railways, roadways, trucks, ports, will be available alongside a skilled workforce. This may not be true for other countries especially in Africa or developing nations in Asia. Even legal complexities and ease of doing business affect how innovations in Supply chain management are implemented.

For instance, for an original product manufacturer in a developing country, the promoters need to first sort fundamental problems in labour safety and logistics before they can consider optimization techniques like an ERP or Robotic Process Automation.

An instance of Geo-political considerations coming into play is when landlocked countries with potential for indigenous goods production have no coastline and hence no seaports of their own. Thus they are dependent on their neighbouring countries for access to sea routes.

Trade Wars between countries with huge Import-Export volumes also affect the smaller developing nations by forcing them to comply with Tariffs or Embargo which hurt their business interests. This leaves these countries with less room to explore the latest innovations to improve their supply chain sector as their primary focus is to ensure they secure effective trade routes which are commercially viable to their customers.

In 2003 the UN in collaboration with the World Bank had unveiled the Almaty Programme of Action which is a project aimed at helping landlocked nations improve their infrastructure and empower the supply chain. In July 2021, over 50 countries and 30 organizations came together in the Central and South Asia Conference to promote economic integration, cooperation, and improving multilateral trade between landlocked Central Asia and South Asia.

Risk of natural calamities, epidemics, or disasters

The risk of force majeure disruptions in the supply chain sector reached unprecedented levels with the onset of COVID-19. The pandemic must be a lesson not only to fill the gaps in the existing supply chain system but also to improve it through decentralization and automation.

Amidst the pandemic, we can see that shortage of chips affected the automotive industry thus hampering vehicle production. This is also when the world is seeing a surge in demand for private vehicles, electric cars etc. This shortage is expected to last even after the pandemic dies out.

Such disruptions have pushed developing nations further back as the goal of enterprises and manufacturers now is to survive & stabilize, before they put together a roadmap to budget for industry 4.0 practices, even though they realize that such forward-looking practices are what will help them brave later storms.

Slow adoption of robust data management practices & data visibility

Big Data analytics is getting popular across all industries and domains. Removing unwanted data, non-essential fields and noise is becoming ever more important to dramatically improving operational efficiency.

However, the adoption rates have been relatively slow which is expected to pick up in the next 5-year window.

The Supply Chain Big Data Analytics Market was valued at $3.55 B in 2020. SCM is expected to reach $ 9.28 B by 2026, at a CAGR of 17.31% for the period 2021-2026.

The tangible impact in Manufacturing Operations

Industry 4.0 will impact the supply chain in a way beyond our imagination. Interconnectedness and interoperability will be the primary focus. Before the introduction of automation technologies, the product supply chains were fully manually operated. This meant feedback loops and data analysis was not easy to perform which resulted in long cycles for process improvement.

The concept of Smart factories & Industrial IoT is getting massive attention across the developed world. Innovative technologies consisting of sensors, IoT, 3D visualization and printing, Data analytics, embedded systems are now energizing & fixing the supply chain holes.

Supply Chain Management

Data feedback loops powered by sensor-based systems are enabling organizations and businesses to better understand what is working and what needs improvement in their own backyards.

A few instances of how industry 4.0 practices are changing the face of manufacturing & logistics operations are captured below

industry 4.0 practices

Getting the Supply Chain Operations workforce skill ready to embrace the change.

Along with the automation of the system, we need to ensure that the employees or workers associated with the same should be able to adapt themselves.

When an existing industry turns smart we need to ensure that employees are taught to work with these technologies. The workforce must be given appropriate training, online courses, upskilling in IoT, software applications used, simulators used, web-based technologies. Along with technical skills, soft skills also need to be given due importance in the 21st century when communication is given utmost priority.

Cavli Wireless for applications in Supply Chain & Logistics that require Smart-Connectivity

Cavli Wireless provides Connectivity at the Edge & Connectivity as a Service with its own range of Cellular modules & eSIM solutions which are integrated with our proprietary Global Data Subscription & Device Management Platform. Our solutions have applications across industries like logistics & transportation, industrial IoT & smart manufacturing, smart city, safety & monitoring and others.

A few use cases for which Cavli takes care of IoT connectivity management include

application in Supply Chain & Logistics

Please scan through our IoT applications page to learn more about use cases we power in Supply chain & logistics management

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