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The Intersection of Supply Chain and Technology

Understanding supply chain technology is important because it’s an answer to the question: “What’s possible when we all work together?” In this article, we’ll explore:

  • The evolution of modern supply chain technology, including the early history of supply chain technology
  • Six key supply chain technology frontiers about which your organization must stay abreast

Let’s jump in:

The Evolution of Supply Chain Technology

Supply chain technologies are not new. Indeed, camels in ancient Egypt served as a chain technology. But the term seems new today because of the rapid advancement of these technologies within the last 50 years. The modern supply chain came about in five major phases: mechanization, optimization, computerization, business automation and collaboration.

The industrial revolution brought about the era of mechanization, with the reduced cost of manufacturing and distributing goods worldwide. In the era of optimization, innovations such as forklift trucks, palletization and the introduction of the shipping container helped supply chains do more with less. In the era of computerization, computer-controlled processes allowed businesses to bring more efficiency to supply chain operations. Soon, this gave way to an ongoing period of enterprise automation.

Today we’re in the era of digital collaboration—connecting and automating supply chain networks at scale. From order-to-cash automation to inventory management systems to TMS systems, key trading partners digitally plug into shared data environments for unprecedented visibility, efficiency, resilience, value, safety, quality and risk management.

6 Key Supply Chain Technologies

Which technologies are positioned to deliver the most significant impact across the coming decades?

1. Digital Supply Network Platforms

The next decade will see tremendous investment in supply chain network platforms, based on strong implementation results by some of the world’s leading corporations. While the latest data suggest modest levels of average supply chain digitization today, a recent report by EY reveals that 45 percent of supply chains are expected to be mostly autonomous by 2035.

2. Continued Advances in Data Science, Cloud Computing and AI

Technologies such as artificial intelligence and machine learning will impact supply chains greatly over the coming decades—providing the ability to process enormous data sets in real time. These data processing and analysis tools will mean the difference between real-time information and real-time decision-making.

3. Propagation of Applied Intralogistics Robots and Drones

Global spend on logistics robotics is forecasted to reach $27.8 billion by 2031. From the warehouse to the field, applied robotics will be key in helping lower global supply chain logistics costs, improve service quality, stabilize labor-related operational resilience, increase facility efficiency and streamline capital deployment.

4. Data Security and Cybersecurity Advances

Bad actors are realizing the value of logistics-related systems as a cyber-security target. So in coming years, hackers will ramp up attempts to access confidential data and launch ransomware attacks. In fact, technology consulting firm Gartner predicts that 45 percent of organizations worldwide will experience some sort of attack on their digital supply chain infrastructure by 2025.

5. Digitally Enabled Supply Chain ESG Performance

From automated logistics planning that could help more accurately track supply-chain-related Scope 3 emissions to accessing real-time vendor Diversity, Equity and Inclusion (DEI) qualifications, interconnected systems will bring more visibility, sustainability and transparency to supply chain-related ESG metrics.

6. Pervasive IoT Adoption

According to McKinsey, IoT could enable $5.5 trillion to $12.6 trillion in value globally by 2030, including the value captured by consumers and customers of IoT products and services. These digitally enabled physical objects are projected to continue revolutionizing the supply chain by creating smarter, more efficient, and more resilient supply chain networks.

No matter what your industry, the competition to leverage supply chain technology for commercial advantage is one that’s been ongoing for thousands of years. And the stakes have never been higher.