While traditional supply chains are facing a more serious slew of unprecedented challenges, the modern supply chains are not spared either. Covid19 has exposed the vulnerabilities and the fragility of the existing supply chain ecosystem. The present situation has forced supply chain leaders to re-think existing strategies and mitigate bottlenecks arising due to dependencies on a geographical region, end to end traceability, a shift in consumer’s priorities, etc.
We have witnessed the growing adoption of Artificial intelligence and machine learning in the supply chain over the last few years, yet many organizations are still at the initial adoption stage.
Here are 3 key trends emerging from the covid19 pandemic that you cannot miss:
- Focus on essential commodities– The non-essential product market has probably suffered the most from the impact of the pandemic. Consumers have shifted their priorities to essentials; the services sector has also taken a major hit. Companies have realized that to stay relevant it is quintessential to adapt to these changes. For example, CPG and FMCG industries have customized products to suit the current consumer needs, “masks” as a new line of products, increase in manufacturing of sanitizers due to its increased demand
- Efficiency-Efficacy Tradeoff – The JIT (Just in Time) inventory has suffered severe shock due to sudden supply disruptions. While JIT is very efficient, it is a trade-off with resilience and the current pandemic situation has exposed that weakness
- Need for a self-sustaining Supply Chain – The hype of AI is real. Self-healing and sustainable supply chains are robust because of artificial intelligence, machine learning, and blockchain technologies. The need for faster and quicker adoption of latest technologies would ensure full traceability of products and a resilient supply chain
The above, however, is not an exhaustive list. Organizations are now looking for distributing workforce and business hubs to reduce overdependence on a particular country/region. We have witnessed and experienced the drawbacks of global dependence on China as the manufacturing hub.
Technologies like blockchain are still niche and not adopted by most organizations. Blockchain in the supply chain is becoming popular for smart contracts management and an end to end visibility of the process. Our best hope is to learn from the current situation and prepare ourselves for the worst!
Origianlly written June 21, 2000