NEXT-NORMAL SUPPLY CHAIN: REVOLUTION IN THE DIGITAL AGE

So here are five trends to be included in the next-normal supply chain:

One of the foremost priorities in the next-normal supply chain is resilience. Traditionally, companies have focused on optimizing efficiency and cost reduction, often at the expense of resilience. However, the events of the past few years have exposed the fragility of such models. Moving forward, businesses must broaden their scope to encompass the entire supply chain ecosystem, monitoring and mitigating risks across political, financial, social, and physical domains. This entails building redundancy, diversifying suppliers, and enhancing visibility to anticipate and respond effectively to disruptions.

In an era characterized by rapid change and uncertainty, agility emerges as a critical differentiator for supply chains. The ability to adapt swiftly in response to evolving customer needs and market dynamics is paramount. To achieve this, businesses must embrace innovation and flexibility, leveraging technology to streamline processes, optimize inventory management, and enable real-time decision-making. By staying attuned to consumer preferences and market trends, organizations can position themselves for success in a dynamic landscape.

Companies are increasingly held accountable for their environmental and social impact, with stakeholders scrutinizing ESG (Environmental, Social, and Governance) performance as a measure of corporate responsibility. For instance, a seven percentage-point increase over 2020 saw ESG indicators used in staff incentive schemes by 29% of businesses in 2021. Forward-thinking businesses recognize the imperative to embed sustainability into their supply chain strategies, not only to mitigate risks but also to seize opportunities for growth and innovation. From eco-friendly sourcing and ethical labor practices to carbon footprint reduction and circular economy initiatives, sustainability initiatives are integral to the future-proofing agenda.

Companies will take charge of the end-to-end supply chain – combining operational excellence, Big Data, AI/ML and cross-functional teams to identify risks and opportunities deep into the supply chain. This pre-supposes visibility into the entire supply chain. Control towers which were set up as war rooms during the COVID disruption will now become permanent. Control towers will ensure end-to-end visibility, helping the organization manage risk even more effectively, boost productivity and reduce costs.

Supply chain management is undergoing a digital transformation, leveraging technology to enhance resilience and efficiency. Key digital solutions, including Robotic Process Automation (RPA), Blockchain, and the Internet of Things (IoT), are reshaping traditional supply chain operations.

RPA, long used for automating tasks, now plays a vital role in streamlining warehouse operations. It optimizes picking processes, provides real-time inventory assessments, and ensures uninterrupted processing, even amidst surges in demand.

Blockchain technology offers a secure and transparent ledger of digital transactions, revolutionizing invoicing and billing processes. By integrating blockchain with digital billing solutions, organizations facilitate instant payments upon goods receipt, ensuring trust and efficiency in financial transactions.

IoT devices equipped with sensors enable real-time monitoring of environmental conditions in transit. This data allows proactive measures to address potential risks, such as temperature fluctuations before they escalate into significant issues.

Thus, this is a once-in-a-generation chance for forward-thinking chief supply chain officers (CSCOs) to future-proof their supply chains. And they can accomplish that by rethinking their supply chains following the three new priorities in addition to the function's conventional goals of cost/capital and quality.