Is This the Golden Era of Tech Use?
Supply chain technology always evolves, changes to meet the needs of the global supply chain, and offers huge benefits.
With the new year, we take a moment to reflect on the state of the industry and the trends shaping it for the remainder of the year.
The supply chain technology trends 2020 has to offer are nothing short of worthy.
These trends reflect the growing demands for more service, more value, faster shipping, cheaper shipping, and an unrelenting pace to predict what’s going to happen next.
Let’s take a closer look at the top six trends, derived from both Steve Banker via Logistics Viewpoints and of course the 2020 State of the Third-Party Logistics Industry Report.
1. Paperless Warehouses Will Leverage Automation
Adding value to the supply chain will become the cornerstone of successful management throughout 2020. Forward-thinking 3PLs need to leverage the voluminous information flowing through their supply chains to make informed decisions, better predict future demand, isolates trends and potential problems, and manage workflows to meet such demands.
Unfortunately, some supply chains continue operating with an antiquated processing model, using paper. Who needs paper in today’s age? 3PLs that wish to stay relevant must evolve their operations beyond the nuances of paper-based tracking and deploy newer systems. According to Pitney Bowes Parcel Shipping Index, more than 2760 parcels are shipped every second in the global supply chain, and the global parcel shipping volume could surpass 200 billion by 2025. The digitalization of processes is the only option.
2. E-Commerce Customer Expectations Will Grow
Customers play a significant role in what supply chains will do to ensure timely, accurate shipping and delivery. The average volume of e-commerce packages has increased more than 20% since 2018, and with all organizations looking to achieve 100% transparency, customers expect to know everything. It is not enough to offer the lowest-cost shipping in today’s world; shippers must offer shipping that defies logic and reason, moving products from warehouse to customer within mere hours. In addition, the likelihood of customer expectations increasing further only continues to grow, and customers play a vital role in building brand reputation.
As also explained by the 2020 State of the Third-Party Logistics Industry Report:
“A negative shipping experience can have an irreparable impact on a customer relationship. 84% of consumers say that they won’t return to a brand after just one poor delivery experience. Furthermore, 89% of younger consumers are likely to promote a brand as a result of positive customer experience.”
3. Business Intelligence and Analytics Will Dominate 3PL Selection Choices
The overwhelming majority of shippers and 3PLs, 95% and 99% respectively, agree analytics are essential to success. With that in mind, only 26% of shippers and 27% of 3PLs believe current analytics capabilities meet this requirement. The rationale for these issues may vary, including a lack of access to data, inability to understand data, and poor categorization of data.
For example, descriptive data does not carry the same weight and insights as prescriptive data. As a result, supply chain technology trends 2020 has to offer will include a greater focus on reviewing and implementing business intelligence tools and analytics.
4. Integration Between Systems Will Finally Get Traction Throughout the Market
Integration stands apart is another key trend affecting supply chain technology throughout the coming year. As organizations look for better ways to deliver more value to customers and business-to-business partners, the integration will be key to streamlining picking, packing, and shipping operations. After all, systems that do not communicate and rely on disparate processes will lead to inefficiencies and added costs.
To stay successful, shippers and 3PLs will need to ensure integration with a diverse set of systems, including supplier and business-to-business partner connection technologies, such API and EDI systems, third-party picking, packing, and shipping software, customer e-commerce websites, such as marketplaces, e-commerce shopping carts, and of course brick-and-mortar inventory management systems. While some shippers may have one or more of these integration capabilities today, only the full set of integration can ensure success.
5. Dynamic Workflows Embedded in System Resources Will Enable More Continuous Improvement
There was a time when standardized rule sets governed supply chain management. Unfortunately, the continuing evolution of the supply chain and growing demand for more e-commerce maturity and capabilities require shippers and other supply chain partners work together to automate and process more orders faster.
In other words, systems must evolve, leveraging artificial intelligence, machine learning, augmented and virtual reality, robotics, and other advanced technologies, to enable continuous improvement. Such functions are only possible through dynamic workflows that adapt to the changing requirements of the supply chain.
6. Supply Chain Leaders Will Use Billing Automation to Enhance Accounting
Another dominant trend to expect in 2020 goes back to automated billing and accounting practices. In the past, the use of auditing programs and accounting software stood apart as a key area of added value for Cerasis’ clients, and the market hadn’t taken hold of the opportunities for automation in accounting.
However, the most recent State of Logistics report indicates billing, invoicing, and accounting services will rise to power and become a differentiator in the market. In other words, these once competitive functions are becoming a standard that everyone must embrace.
Align Your Business With the Supply Chain Technology Trends 2020 to Stay Competitive
E-commerce and the Amazon Effect continue to stand apart in the global supply chain. As the value of e-commerce moves to take a larger market share in retail, shippers need to know how to leverage technology to reap greater rewards and value.
The right applications of technology, inclusive of analytics, advanced TMS solutions, and automation, will make the biggest difference and help shippers stay competitive and survive.
Will 2020 - the presumed “Golden Era of Supply Chain Technology” - finally bring balance to the forces of logistics? All indicators say, “yes,” but only if shippers take the steps now to align their organizations with these trends.
Related Article: How to Write a Standardized Supply Chain Management Plan