The report covers new insights into trends and technologies that are having a dramatic impact on supply chains, manufacturers, business-to-business enterprises and other affected industries.
The report predicts “Always-On” supply chains to provide greater efficiency, visibility and customer service across many industries. However, these systems will also challenge companies to find greater talent to manage them and operate new technologies.
Based on responses from 900 supply chain industry leaders, the report covers eight key emerging technologies, barriers to implementing innovations and levels of investment.
The report also outlines recommendations on how to remain competitive amid industry changes.
How Innovation is Driving Digital “Always-On” Supply Chains
The report outlines a lack of talent as the most significant challenge facing the supply chain industry, according to 58 percent of respondents to the survey. 35 percent of respondents consider this scarcity to be the largest barrier to innovation.
Customer demand for faster response times and lower delivery costs were also cited as significant challenges, according to 56 percent of respondents.
“Lack of a clear business case” was reported as the greater barrier in new technologies, according to 43 percent of respondents. The report claims that despite this, more manufacturing and supply chain companies are investing in new technologies.
52 percent of respondents said they planned investments in excess of USD$1 million, compared to 49 percent in the 2015 study. Three percent reported investments of over USD$100 million over the next two years.
8 Technologies Are Creating the “Always-On” Supply Chain
Eight technologies in particular were cited by 83 percent of respondents—versus 75 percent in 2015—as a possible source of competitive advantage and disruption in the next 10 years:
- Predictive Analytics
- Robotics and Automation
- Sensors and Automation Identification
- Wearables and Mobile Technology
- Driverless Vehicles and Drones
- Inventory and Network Optimization Tools
- Cloud Computing and Storage
- 3D Printing
The top four technologies believed to provide a competitive advantage for “Always-On” supply chains include:
- Robotics and Automation (51 percent, up from 39 percent in 2015)
- Inventory and Network Optimization Tools) (48 percent, up from 45 percent in 2015)
- Sensors and Automation Identification (47 percent, up from 42 percent in 2015)
- Predictive Analytics (44 percent, up from 38 percent in 2015)
“The innovations driving “Always-On” supply chains are initially disruptive, but they can empower firms to optimize processes and improve efficiency, creating a more flexible experience for workers and driving measurable business outcomes,” said Scott Sopher, principal at Deloitte Consulting LLP.
“According to the survey findings, adoption of the technologies covered in this report will grow dramatically over the next six to 10 years,” Sopher continued.
Robotics and automation, along with driverless vehicles and drones, are making bigger impacts on the supply chain sooner than previously predicted. Both technologies saw a 12 percent growth over last year’s report.
Adoption for robotics and automation is currently cited at 35 percent, but is expected to rise to 74 percent in the next six to 10 years. Adoption rates of driverless vehicles and drones in the supply chain industry are expected to reach 50 percent in the same time frame.
Accelerated adoption of new technologies is predicted to dramatically change how the supply chains operate and how they are managed in the future.
Recommendations for Today’s Supply Chain Leaders
The study makes several recommendations for companies looking to remain competitive in the manufacturing and supply chain space:
- Invest, test and learn in new technologies
- Partner with solution suppliers, universities and trade groups
- Determine where to start gathering data
- Determine how current your data needs to be
- Make sense of the data so you can act on it
- Nothing is more important than talent management
“Of all the recommendations we offer leaders in the supply chain industry, the most important is the need to proactively manage talent,” said George Prest, CEO of MHI.
“The growth in digital, ‘Always-On’ Supply Chains will only widen the talent gap that already exists in our industry,” Prest continued. “We need to train a new breed of supply chain professional who has technical, analytical and problem-solving skills. Much of MHI’s work is focused on providing resources to help the industry close the talent gap through education and training programs and industry collaborations.”
The 2016 report launched today, April 6th, at a keynote at MHI’s MODEX 2016 show at the Georgia World Congress Center in Atlanta.
Those interested can access the full report here. For more information, visit www.mhi.org.