The turn of the year is the time to take stock and look ahead. Digitalisation of supply chains will remain high on the agenda in the coming year. This is according to surveys by Zebra and Transporeon. Artificial intelligence (AI), in particular, may count on growing interest. Some concern is the conclusion that almost nine out of 10 companies can barely keep up with the high pace of innovation.
Business is in uncertain times. The Nederlandsche Bank (DNB) concluded in mid-December that although economic growth is picking up, uncertainty is increasing. Geopolitical developments, in particular, pose a threat to the economy. Companies remain sensitive to the conflicts in the Middle East and Ukraine, while with Donald Trump's re-election, the likelihood of a trade war including rising trade tariffs is growing.
Companies are concerned
Transporeon's survey of 100 decision-makers shows that companies in manufacturing, retail and distribution are indeed very concerned about geopolitical developments (60 per cent) and economic conditions (58 per cent) and, to a lesser extent, trade barriers (33 per cent). No more than 38 per cent of companies in industry, retail and distribution are optimistic about 2025.
Interestingly, logistics service providers are also concerned about the economy (57 per cent), but do not seem to be nearly as concerned about geopolitical conflicts (34 per cent) and trade barriers (18 per cent) as their potential clients. Perhaps they see opportunities to increase their added value in these uncertain times. Not surprisingly, they are a lot more optimistic about the new year (75 per cent).
Closer to the sales market
Many manufacturing companies are not waiting and are responding to growing uncertainty, according to Zebra's survey of 1,200 decision-makers from European and US manufacturing companies. Over a quarter of them currently have rigorous plans to move production lines and manufacture closer to the market. That will rise to 46 per cent over the next five years.
Not all manufacturing companies are going as far as moving production, but most are taking steps. As many as 50 per cent want to increase the flexibility and resilience of production processes over the next five years, while 51 per cent want to expand their ecosystem to include more supply chain partners. Even more companies (57 per cent) are thinking of investing in automation. The reasons cited: reduce dependence on the tight labour market and improve quality.
AI tops
At the very top of the strategic agenda is artificial intelligence (AI). Currently, 41 per cent of manufacturing companies have concrete plans to improve performance and processes with implementation of AI. Over the next five years, this will rise to 61 per cent. In particular, 3D vision (70 per cent), machine learning (64 per cent) and deep learning (63 per cent) are popular AI techniques for automating daily processes.
In addition, companies expect AI (56 per cent) together with other technologies such as big data analytics (59 per cent) and internet of things (58 per cent) to help them automate and optimise their decision-making processes. Notable is the rapidly increasing interest in large language models (LLM), the form of AI that broke through globally with the introduction of ChatGPT. Currently, only 34 per cent still use LLM when making decisions, but this is expected to grow to 64 per cent over the next five years.
Long way to go
Logistics service providers also see great potential in digitalisation, Transporeon's survey shows. On the priority lists for 2025, digitalisation (48 per cent) is second only to cost savings (52 per cent) and ahead of sustainability (39 per cent). Like manufacturing companies, logistics service providers seem to have high expectations from AI. When asked which trends will shake up the transport sector, 45 per cent mentioned this technology.
However, when it comes to process automation, logistics service providers still have a long way to go. More than half of companies (54 per cent) expect less than a quarter of their processes and transactions to be automated by the end of 2025. Only 10 per cent expect more than three-quarters of their transport operations to be automated.
Difficulty with pace of innovation
So companies have big ambitions with regard to digitalisation and AI, but the question is whether they manage to realise them. As many as 86 per cent of the decision-makers surveyed by Zebra struggle with the speed at which new technologies such as AI are developing. Their organisations can hardly keep up with the pace. Digitisation projects have long lead times, cost a lot of money, require a lot of effort and have long payback periods.
