To address supply chain risks, companies need to embrace digital technology. As to how to assess the array of technologies available, Digital Journal gained insights from supply chain transformation and global delivery authority Nirav Patel, CEO of Bristlecone.
Digital transformation is already reinventing the modern supply chain across sectors as technologies like Artificial Intelligence (AI), Machine Learning (ML), internet of Things (IOT) and Blockchain integrations grow.
Patel sets out three areas of digital innovation for improvement.
Supply Chain Digital Twins
Digital twins are digital replicas of physical supply chains. They integrate with the company’s systems to provide real-time insights on any sudden disruptions in a supply chain’s performance level, allowing supply chain management to become more proactive than reactive.
According to Patel: “Digital twins help companies mitigate environmental risks by immediately notifying them of natural disasters or other external forces that can harm the supply chain’s efficiency. This simulation provides an additional level of visibility that would otherwise be impossible without leveraging technology.”
Predictive Maintenance
This is a preventative technique that uses machine learning technologies and sensors to track how machines and systems are functioning.
Patel observes: “Predictive maintenance is able to foresee when a machine is likely to develop issues in the near future so that maintenance can be done before any breakdowns. Supply chain operations become more resilient knowing that all machines and robotics are working efficiently.”
Tracking
This is an area that Patel says company’s really need to embrace: “Today’s supply chain management companies live in a fortunate time where they can collect real-time updates on current events courtesy of the Internet and other technologies. Companies can leverage social media to obtain consumer behaviour analytics while also monitoring the industry, news and other sources that can indicate potential supply chain disruptions like the passing of a new regulation.”
In terms of examples, Patel cites: “Logistics and transportation technologies provide powerful modern digital fleet tracking so that companies can track their shipments and fleets across land and sea, all over the world. Analytics from cloud-based and other technologies provide valuable insights on—and can fiscally quantify—things like employee engagement and productivity. This data is direct feedback that supply chain managers can leverage to assess what leadership tactics are effective and which fail to drive workforce benchmarks.”
Digital advantages
Mitigating avoidable business risk by proactively transforming and shoring up supply chains with digital technologies and methodologies such as those presented above are forecasted to persist over the next few years.
Gartner predicts that “by 2026, more than 75 percent of commercial supply chain management application vendors will deliver embedded advanced analytics (AA), artificial intelligence (AI) and data science.”
A McKinsey survey also cited that more than 90 percent of respondents reported they have invested in digital supply chain technologies in the last year.
“Supply chains are complex and disruption is becoming the norm,” Patel adds. “Businesses must be able to operate seamlessly within their ecosystem of functional teams, partners, logistics providers, customers and other stakeholders, and work together to navigate and mitigate supply chain risk—all while improving customer experience. Establishing multi-tiered digitalization replete with data aggregation, information exchange, collaboration, risk management, AI-powered analytics and robust cloud technologies can shore up a supply chain with unprecedented speed, visibility, synergy and control. It’s a mission critical way to maintain the kind of resiliency that will demonstrate—and protect—business value.”
In a companion article, Patel looks at “Risk prevention: Three supply chain challenges for businesses to worry about.”
