Nature is already teaching us: in rapidly changing conditions, the ability to adapt is crucial. Whether it's climate change, artificial intelligence or increasing consumer awareness.
Ripple effects
With changes in trade structures and changing power relations in global markets, tariffs and agreements are being renegotiated. Supply chains are coming under pressure due to climate change. These effects will pass through supply chains like a ripple. This may lead to paralysis of supply chains.
Designing supply chains with the ability to quickly adapt to circumvent natural disasters or quickly reconfigure in the event of shifts in cost or material availability due to changed rates has then become critical to maintaining high service levels.
This requires, for example, smart and intelligent procurement systems that constantly assess risk for the delivery of critical goods.
Digitalisation
Artificial intelligence progress is limited, although this is mainly caused by unfamiliarity with possible applications Artificial Intelligence (AI) is still in its teens but will soon come of age, with research by Forrester showing that 55 per cent of organisations plan to invest in AI before the end of 2019. It won't be long before progress is made and better integration with procurement platforms is realised. Such developments will help meet customer needs, create real-time efficiencies, capture data networks and manage improvement plans.
Using AI with smart procurement platforms will give buyers better insight and enable better supplier evaluation. It will help with ordering, invoice processing and quick access to information on a global scale. Information from IoT will also be able to be integrated.
Digital freight platforms that create online marketplaces will become increasingly important so that carriers can be connected quickly and efficiently. It supports in streamlining processes and thereby lowering costs, risks and making possible options more available to the market.
Advance of robots
Robotics technology is expected to reach a tipping point in 2019. The technical capabilities and improved interfacing with software systems provide ample opportunity to robotise processes such as order picking. Initially, robots will supplement warehouse workers, but the final switch will not be long in coming.
Research firm Gartner claims that by 2023, more than 30 per cent of warehouse workers will be 'augmented' by collaborative robots, allowing people to focus more on what they are good at: complex deliveries, returns processing and keeping direct contact with customers and suppliers.
Ethics and transparency
Application of AI and robotisation requires companies to think more about issues such as ethics and transparency in the decisions they make. Think of privacy-sensitive decisions, robots taking over jobs will stir up a lot of social debate with all the risks for companies.
But also in the field of sustainability, it is important for companies to take steps to protect their supply chains. Doing nothing is a dead end because resource availability is rapidly decreasing, supply chains will be disrupted by climate effects and the public and political view on driving sustainability. Companies that lag behind may face tight legislation and, in the worst case, consumer boycotts. The need to adapt quickly is even more important today than ever before.
