April 06 2020

Supply-Chain Productivity: The Missing Link

As other industries move forward and keep on trend with emerging technologies, supply chains have been acknowledged as lagging behind. It has been pointed out that the distribution Industry’s close counterparts; the retailers, have consistently progressed alongside novel technologies and pursued more sustainable ways of working.

This may be down to the Retail Industry’s direct contact with the public and consumers, but regardless, it is important that technologies are introduced and leveraged by all links in the supply chain if we want to reduce losses and improve efficiency across the board.

The FWD has touched on this in previous research, suggesting that with the changes to how Distributors operate, such as the ever-increasing power of e-commerce or wholesale by-pass;

“It is essential that wholesalers embrace digital transformation and fully utilise the new opportunities that e-commerce presents.”

-Frank Shaw, Foresight Director, Centre for Future Studies

Relying on manual processes, has for decades now, been a hindrance to businesses, and given the close links throughout the supply chain, if one link has slowed progress, the entire supply chain cannot fully optimise its workflow. Therefore, each business should look internally for ways it can remove and replace ineffective processes.

The key points contributing to major losses are inventory and warehouse management, as well as unclear logistics that are largely caused by a lack of visibility.

The Technological Delay

supply chain technology stats

Source: https://stfalcon.com/en/blog/post/logistics_software_solve_issues#more

Above shows statistics for the processes, supply chains rely on to supply goods, as well as the top areas of concern on a global level.

As you can see, one of the key points that must be confronted is the lack of visibility supply chain businesses have - A lack of visibility means businesses do not have access to the data they need to see the areas they need to improve and the primary points of lost profits. Without being able to clearly see where a business is performing poorly, there is little opportunity to look for how to improve.

Another obstacle is the cost of logistics and fuel - Outsourcing logistics solutions easily put pressure on budgets, particularly smaller businesses operating more locally.

Another key concern is the lag behind digitisation - There is a strong agreement that supply chains require the automation of slowed manual processes, particularly those concerned with visibility and analytics.

This is a trend that is becoming increasingly introduced, largely on the logistics side of businesses - To minimise the impacts of disruptions on a daily, weekly and monthly basis, teams must have the appropriate data and insights to make informed decisions at all times, and new technologies are helping distributors access the data they need.

When new Software becomes a problem

Adopting new technologies is not simply the magic bullet. If a System or Software is difficult to implement, complicated and tricky to use, it can become more of a problem than a solution, especially when it is first being implemented.

Similarly, the software can offer extensive data, but if this data is difficult to translate into digestible, clear points for improvement, then it will not be of much assistance when trying to resolve inefficient processes.

Looking Forward

Alternatively, an easy-to-use, simple interface and user-friendly platform can help bridge the gap of transitioning to an automated workflow and can remove the delays that come with having workers trained.

Being able to harness the benefits of a new system quickly massively helps the chances of a business to get ahead of the competition. If this adoption happens before the trend, and before fully automated processes become the norm, then the right software can help you reach more customers, get ahead of the competition and cut losses which all directly impact profitability.

As technologies develop, distributors and supply chain links need to look towards automated systems that help them work faster, more accurately, and with better visibility, so they can plan ahead with better foresight, predicting and responding to both customer demand and disruptions.

We conducted a survey asking supply chain workers in the food and drink Industry to give their thoughts on new delivery management systems and technologies, and where the Industry needs improvements.