Supply chain management is a process-driven approach focused on delivering a product at the lowest cost to the customer and maximizing profits for the company. Organizations that engage in supply chain management face intense competition pursuing the same market share goals to provide innovation and utilize available tools to maximize the benefits from the overall process. The use of technology has changed the supply chain management landscape. Here are five ways companies use technological advances to meet their supply chain management needs and remain competitive.
Supply Chain Management Utilizes Data Analytics
The use of data analytics spreads across all industries to drive continuous improvement. Companies can react appropriately for future planning as they learn from past supply chain management successes and failures. Important company decisions rely upon available data drawn from a review of the entire supply chain performance. A freight audit can show the weakest links in the shipment process and where changes are necessary to address lost profits. To remain competitive, companies need to understand their supply chain flow in real-time and react where required.
Supply Chain Management Utilizes Automation
The supply chain management process utilizes a combination of manual processes and automation to meet the expected goals. It would be impossible to remove all human interaction within the supply chain, but successful companies will find the most effective ways to maximize automation. The integration of automation brings many advantages. Systems don’t get tired, they don’t get paid a salary, and they aren't susceptible to human error. A company will face an upfront cost for integrating automation but will realize the cost benefits over time.
Supply Chain Management Utilizes Artificial Intelligence
Supply chain organizations expand their use of automation through artificial intelligence technology. The supply chain process is a sophisticated series of procedures and decisions. Companies that succeed in the supply chain management business integrate artificial intelligence to help make decisions at critical moments to minimize human time. Artificial intelligence can review analytical data and adjust for fuel consumption and load balancing on shipments. Every decision and change can positively or negatively impact a company’s profit margin and reputation. Artificial intelligence brings consistency and reliability to decision-making.
Supply Chain Management Utilizes Blockchain
Organizations realize the benefits of using the blockchain as a transactional database tool to drive supply chain management. Blockchains are blocks of reliable data chained together in sequential order and via secure programming to ensure the safety and reliability of data. All the companies within a given supply chain can access the database blockchain. This shared access minimizes time for data validation and reduces communication errors through data transfer. Quality control is an integral part of supply chain management, and blockchain provides tools to help organizations continuously improve.
Supply Chain Management Utilizes Logistical Management Software
Every company utilizes technology to automate decision-making and manage day-to-day enterprise resource logistics and business processes. Using an enterprise resource planning (ERP) management system accomplishes this goal and allows all company departments to manage their areas and find synergy through cross-functional integration. A company that finds itself struggling in supply chain management can quickly evaluate company performance through the data provided by the ERP system for areas such as finance, human resources, marketing, and information technology, to name a few.
An organization that wants to remain at the front of the supply chain management industry will consistently evolve to find innovative ways to meet its demands. There will always be another company promising to do the same work cheaper and fast. The companies that succeed will find the right balance of technology and human interaction to drive quality and cost-effective results.
