At the beginning of every new
year, it is customary to give an opinion of the trends that are emerging or
that are likely to develop further during the course of that year. Supply chain
management is no different, as the discipline is constantly evolving in the
quest for ever improving service levels through increased efficiency and
effectiveness.
Some of the current technology
trends attracting a lot of international interest, such as increased automation
and robotics, self-driving vehicles and drone deliveries, as well as 3D
printing certainly remain long term trends, but not necessarily for 2017.
Supply chain trends will continue
to be driven by the need to support business in meeting customer expectations
while continuing to better manage and control costs. As a result, priorities
for supply chain executives this year will include:
Supply chain analytics
The use
of supply chain analytics and business intelligence will increase as
organisations work to improve control and visibility of the extended supply chain.
Awareness of the supply chain as a strategic business lever will also continue
to grow, while supply chain event management and measurement will provide the
fulcrum.
Furthermore, accurate reporting
and the ability to analyse reports will enable business to identify poor
performing partners, highlight inefficiencies and weak links in the chain,
identify opportunities for efficiency improvement, increase collaboration, as
well as better supply chain cost management.
Ongoing eCommerce challenges
The rate of
growth of online retail versus bricks and mortar retail is set to continue.
This will put pressure on businesses to meet the ever increasing expectation of
online shoppers for prompt, on-time delivery of purchases.
Couriers and distribution service
providers will be expected to be more efficient while under pressure to be cost
competitive. As the eCommerce side of a business grows, more sophisticated
warehousing solutions will be required to meet the accuracy and timelines
demanded by an online business.
This could lead to the
outsourcing of eCommerce warehousing to specialist service providers.
Supplier/partner integration will be a key success factor, as will accurate
tracking and delivery status communication to the customer.
Technology and automation
While
significant advances are being made in the use of technology to facilitate
supply chain efficiency, in South Africa there is the additional challenge of
balancing the level of automation with labour. Augmented reality, can provide
improvements in accuracy and efficiency in picking and load planning, as well
as packing, but can also be a useful tool to support and train less skilled
logistics staff.
It will be important to invest
wisely in technology to ensure a good return.
Skills and resources
An independent
report found that 45% of South African supply chain managers believe they do
not have the skills to do their job properly. Further research also suggests
that those who do possess strong quantitative abilities often lack equally
important interpersonal and leadership skills.
Finding and retaining skilled
supply chain staff as well as managers will continue to be challenging.
Organisations will need to invest in training at all levels to develop the
skills necessary to ensure the sustainability of their supply chains.
Increased SCM risk and disruption
As supply
chains extend and reliance on global suppliers and partners increases, supply
chain risk and disruption can be expected to continue. Rationalisation of
suppliers and improved collaboration with preferred suppliers can help mitigate
risk, but it is important to identify alternative sources of supply for
products, critical components and materials.
Therefore, contingency plans
should be put in place to enable quick response to unanticipated disruption and
ensure business continuity.
It is further important to build
resilience and predictability into a supply chain to avoid being the cause of
your own disruption. Supply chain planning, visibility and measurement continue
to be key disciplines critical to minimise unnecessary disruption, while
collaborative partnerships with reputable, well established logistics service
providers will also make your supply chains more resilient.
It’s good to look forward to an
exciting year that won’t be without it’s challenges, but that will also be full
of opportunity. I believe that the supply chain is one of the primary keys to
the success of an organisation and that if it is robust it will continue to
provide a platform for strategic competitive advantage.
Contributed
by: By Mungo Park, President of SAPICS
