Supply chain tech trends to watch
The supply chain is now an opportunity, a service, an asset, even a competitive advantage.
Companies are differentiating themselves by providing transporting products and dodging hurdles in the supply chain. Opportunities in the cold chain are particularly massive. In the U.S., between 30% and 40% of the nation’s food is wasted in the supply chain.
Not to mention the chance to reduce our carbon footprint; about 6-8% of all human-caused greenhouse gas emissions could be reduced if we stopped wasting food. In the US alone, the production of lost or wasted food generates the equivalent of 32.6 million cars’ worth of greenhouse gas emissions.
Within the Internet of Things (IoT) space, the capability of connected edge devices to assist and advance applications such as track-and-trace, cold-chain monitoring, actuator triggering and energy management is well-known. Scale-up deployments of those applications have been limited to back-burner projects by the large IoT players.
Expect the following tech areas in 2022 to become more ubiquitous in supply chain management:
IoT driving business decisions
IoT is a widespread term meaning connected internet devices that transport data. It’s a big and accelerating world — one forecast suggests there will be more than 75 billion IoT-connected devices in use by 2025. This would be a threefold increase from 2019. The IoT marketplace is predicted to be worth $4 trillion by that same timeline.
The average person’s list of IoT devices ranges from cell phones to smartwatches to intelligent appliances. For those of us in the supply chain management realm, and especially in cold chain management, there’s one piece of IoT tech that’s going to reign supreme: smart labels.
These IoT-connected devices can be attached to products from the point of manufacture until the final consumer destination. Along the way, they collect data and bring it into one place. Think of an item’s path along the supply chain as digital art: the data provided by smart labels serve as thousands and millions of pixels that, when assembled, paint a larger picture.
The impact of this “seeing the bigger picture” is especially strong when viewed through the lens of the issues we’ve all experienced in the past few years. Knowing what’s going on as items pass through the supply chain brings business decisions closer to the products.
Supply chain management professionals can act on what’s happening within the supply chain environment as it happens. That’s a crucial element — smart labels enable decision-making to occur as decisions need to be made.
The eruption of IoT devices at the edge will require batteries that can withstand the rigorous demands of the cold chain environment to power smart labels. Technology that can remain resilient and accurate through low temperatures, humidity, and moisture will be vital. As IoT devices connect us digitally, the technology that allows for these connections and manages the devices will be the key.
Moving from the cloud to the edge
Edge platforms along with virtualization technologies such as virtual machines and containers enable application portability across computer hardware vendors. This move will likely see gateway providers emerge along with more powerful edge devices able to run lightweight machine learning. The cloud providers surely will not give up on their push to the extreme edge with real-time operating systems and run-time environments enabled on devices, including cellular smart labels and wearables.
Advancements in AI
As the data provided by IoT forms pixels that make up a bigger picture, these pixels must be organized to prove meaningful. Another tech trend in the supply chain for 2022 is the use of artificial intelligence (AI).
AI solutions used in the supply chain are another tool that informs decision-making. It can be used to predict future supply chain data based on past history gleaned from the IoT data pixels.
A refined, transparent supply chain is a result of IoT and AI working together. AI-based algorithms and platforms tighten up both upstream and downstream operations for a smooth ride without wasted time. Together, AI and IoT solutions form a partnership built on using patterns to predict problems and provide solutions.
Demand planning and digital twins are a pair of AI tech solutions you should keep an eye out for in 2022. Both solutions will be accelerated by the increased availability of data and cloud environments managing large fleets of edge devices.
Automation as a result
The third and final trend to watch for is automation. Just like AI advancements being a natural progression from IoT-provided data, automation is a result of data and AI working together.
The replacement of repetitive and time-consuming activities through automation has been an ongoing process for years. It’s nothing new. What is new when it comes to automation and the supply chain, however, is automation’s role in transportation.
Transportation automation will make supply chain professionals with an understanding of data extremely valuable. Automation can happen at a faster rate as professionals within the industry take the data and implement AI platforms to make decisions. The result is staggering. A study by McKinsey & Company found that 61% of executives who introduced AI into their supply chains reported decreased costs, and more than 50% reported increased revenues. More than 33% of respondents reported revenue increases of greater than 5%.
Why do these trends matter?
As the supply chain becomes more of a focus for businesses in every industry, executives are discovering what we industry professionals knew all along: it has large opportunities for bottom-line impacts.
The pathway of IoT-connected devices feeding AI platforms and automation to arm decision-making is entrenched. As the old adage goes:
“You can’t manage what you can’t measure.”
These tech trends allow us to do both.
