Supply chains have long been one of the most undervalued aspects of businesses. Although a smooth and well-running supply chain is absolutely critical to the success of nearly all businesses, most people have never given them a second thought.
That is until the COVID-19 pandemic wreaked havoc on supply chains globally. As businesses shut down and workers were sent home, supplies and docks were not moved in their normal fashion, and ships were left unloaded. As these delays built up over the course of several months, a quickly growing supply chain crisis became apparent and will now take years to return to its previous status.
The renewed spotlight on supply chains has brought about a number of significant questions for many businesses. Namely, how can we work to make our supply chains more efficient, effective, and resilient to another situation like what just happened? The answer for many companies is to take a deeper look into the potential for supply chain automation.
What Does Supply Chain Automation Entail?
When most people hear the word ‘automation’ their mind immediately skips to a far-off, futuristic world where robots do everything for us and humans have become unnecessary for the entire process and are able to pursue other hobbies and activities. While we are still a far cry from that, automation using technology is here and it does make our lives easier. In fact, it can completely revolutionize the supply chain industry as we know it.
There are multiple aspects of supply chains that can be automated or that can at least benefit from automation technology. For instance, tools such as robotics can be utilized to move supplies around in a faster and more organized manner. It can also significantly reduce the risk of injury. Simply automating menial and manual tasks like moving supplies around a warehouse can increase retrieval accuracy by up to 99%.
Tools such as machine learning and artificial intelligence can optimize and speed up processes while still improving the transparency of the entire system. It can help end-users track where shipments are in the process and if there are circumstances that are holding items up. This optimization will ultimately mean money saved for companies over time.
Investing in New Technologies
New technologies within supply chain management abound. There are literally hundreds of different tools and directions any company can go to start working towards greater automation in their supply chains. For example, technologies that help to manage data capture can be a huge help. Data capture such as scanning items, checking inventory lists, and processing purchase and sale orders is easily handled by big data and artificial intelligence software.
Technologies such as 5G can also be highly beneficial to supply chain management. It can improve processing times for data and make it more realistic to capture real-time information regarding the status of certain products or shipments. 5G will ultimately help the technologies introduced to supply chains work faster and more efficiently, compounding the benefits.
Another tool, blockchain technology, can also be used to improve the sophistication of supply tracking and security. Blockchain can make transactions all throughout the supply chain more secure. Many people love the technology because data is encrypted and nearly impossible to tamper with, leaving a clear ‘chain’ of interactions that can be tracked backward through time.
Working Towards a More Resilient Future
Many business leaders are also investing in greater supply chain management in order to ensure that their chains are more resilient during emergencies in the future. The first step in this process is building a greater understanding of the supply chain in general. Determining exactly where each and every material comes from and the risks associated with that piece of the chain is valuable information that can be used to formulate a plan should something go awry.
The next step is to develop a good risk-management strategy and ask hard questions about how the current supply chain is set up. Determining if there are other suppliers available and if it would make sense to diversify where materials are coming from is an example. Perhaps rather than all of material A coming from one source it would be reasonable to have it shipped in smaller quantities from two or three additional sources.
A more resilient future also requires regular performance monitoring. Here new technologies can play a valuable role. Again, artificial intelligence services and tools such as predictive analytics can help to catch changes in supply chains and identify potential problems before they happen. It can be a very powerful means of avoiding catastrophe and keeping everything running smoothly.
Supply chain automation comes in a variety of different forms, each of which can make a significant contribution to the greater efficiency and resiliency of how supply chains run. Although each of these supply chain automation tools is an investment, over time it will be a significant benefit and financial savings for companies that incorporate them.
By Indiana Lee, BOSS contributor