Transforming 21st Century Supply Chain Demands with Advanced Technology
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The success of any contemporary business today depends on fulfilment. Timely delivery of the product on offer has been as old a business practice as retailing itself. This whole process of procuring, storing and delivering is what is today known as ‘Supply Chain Management’ in the industry. Ever since trade and commerce started, it has been the prerogative of the business owners or managers to ensure uninterrupted management of the supply chain. In the 21st century, trade is no longer local or regional, but it has transcended geographical boundaries.
Picture this, when we visit a supermarket or the neighbourhood mall for shopping, it is quite likely that your shopping cart would contain products ranging from Coffee from Mexico to cotton clothes from India, electronic goods from China, tea from Darjeeling, chocolates imported from Europe and so on. This shows you the range and diversity of products and its respective sources in a retail store. Now imagine how the company must manage the sourcing of these products from different locations from around the globe, the transport, the storage to the delivery and all in a timely and efficient manner depending on demand and market conditions.
Large retailers, as a result, need to constantly work in tandem with scores of vendors/buyers scattered across a vast geographic region. Manual management of the supply chain is no longer possible for large growth-oriented businesses.
The total global volume of digital data is set to reach 44 zettabytes by the year 2020. On average, internet users share over 2.5 million pieces of content on Facebook along with more than 300,000 tweets and more than 204 million text messages.
It is nothing short of a data Tsunami that businesses all over the world are dealing with. Despite the daunting challenge, the brands need to dive in and extract actionable insights from the data.
It is this twin impact of global synchronization of the fulfilment chain and analysis of mind-boggling data volumes that necessitates the integration of advanced tech into the Supply Chain Management. Let us look at some of the key aspects of SCM that is being overhauled by technology.
Cheaper and Optimized Logistics: For retailers, especially eCommerce companies, one of the biggest challenges is the cost and efficiency of logistics. While the big eCommerce brands and major retail chains deploy cutting-edge technology such as automation and self-propelled machines at their warehouses, they must at times contend with poor logistics networks. As a result, there is a lot of scope for improvement needed in the way the delivery logistics for millions of orders are being handled. There is a dire need to get things delivered faster, cheaper and with better precision. This is where tech-enabled shipping solutions help by identifying the fastest and the shortest delivery route, thus, cutting down transportation cost, labour cost and carbon footprint. In fact, it is interesting to note that the problem is not a resource crunch, but more so underutilization of resources available.
Intelligent and Robotically Automated Warehouses: Technology is now not only optimizing the way goods are delivered, but also how they are stored. There are millions of pieces stashed in a major fulfilment centre and machines like self-driven forklifts and robots work independently to ensure timely and accurate movement of the same. They are remotely controlled by advanced CCTV monitoring and capable of raising an alarm if something suspicious or unsafe takes place. These smart machines bring down costs and provide better productivity with seamless operation.
For a retailer, another major challenge is to manage and seamlessly integrate operations between warehouses located thousands of miles away from each other. This is where the ‘Smart Warehouse Management Systems’ are being merged with ‘Order Management Systems’ to create a superior experience. From the moment a customer wraps up their purchase process, to the point the delivery is confirmed, the whole process is orchestrated by technology in a touch-free manner. Such technology integration eliminates problems such as a wrong delivery address, overbooking of orders or accumulation of excess inventory.
Today, machine learning tools can provide the real-time and continuous forecasting of demand and supply scenarios. Hence, the warehouses are becoming smarter and more efficient.
Overcoming Language Barriers: Another major barrier that technology has removed is the language issue. Global trade results in a lot of diverse languages’ data being collected. It is impossible to manually process such huge data volumes and that’s where the evolution of Natural Language Processing (NLP) is proving to be a major boon in segregating and analysing the data. It also helps businesses extract meaningful insights which might have been otherwise lost due to foreign languages. This has resulted in seamless functioning of SCM between various countries such as India, China, Russia and the USA on a real-time basis.
Real-Time Inventory Visibility: Today customers are going mobile at breakneck speed and as a result, most major retailers sell via mobile apps apart from their main websites and offline stores. Also, there is a rapidly growing trend of hybrid retail that merges the offline and online channels to provide an Omni-channel experience to the customers. A person might spot a product on the website but try to order it later via the mobile app or walk into the retailer’s physical outlet to purchase it. In such an Omnichannel scenario, it is imperative that the inventory visibility must be real-time integration between all the channels. The sophisticated technology-driven interfaces today make it possible to provide Omni-channel visibility on a real-time basis. Inventory is managed digitally and the moment a product goes out of stock, it goes offline as well. This eliminates the chances of receiving any further orders for products out of stock. It also leads to a faster delivery routing as the AI-powered system automatically locates the product and works out the shortest delivery route while instructing the concerned warehouse to ship the order to the customer. The entire process takes place digitally and in the blink of an eye. Such highly advanced SCM systems are essential in the Omni Channel retail environment since they facilitate precise order placement and delivery.
To sum up, 21st century Supply Chain Management is far more dynamic and crucial than ever before. Businesses are global and compete to ensure faster, cheaper and more accurate processes. Today’s businesses must deal with a huge and widely spread customer base and they need to rely upon advanced technologies to meet their goals and grow!
We have seen how AI and cloud tech is expanding its footprint in Supply Chain Management. With the experiments regarding driverless trucks, drone delivery systems and so on, it is evident that in the future Supply Chain Management solutions will become even more automated.