Supply Chain Trends for Software Developers

These technology trends will actively shape what supply chains may look like in 2021 and beyond.

For years, business leaders have invested extensive time and resources into making their supply chains as fast, nimble and predictable as possible. The goal of order management systems is to reduce turnaround times, allowing for the reduction of inventory sizes. The world of fast fashion is a perfect example. This strategy has clear advantages, but the global pandemic and other black swan events have exposed several shortcomings with this singular approach.

Rapid supply chains that were previously championed have been experiencing significant breakdowns and shortages; examples in the early days of the pandemic included everything from PPE to fitness equipment. Now that supply chain leaders have experienced more than a few months of operating during the pandemic, they have already begun reimagining all aspects of their supply chains to adapt. A recent Oxford Economics survey of 1,000 supply chain executives gives a glimpse at several trends that will actively shape what supply chains may begin to look like in 2021 and beyond – and where technology will play a role in this evolution.

Trends Impacting Supply Chain

First, it’s no surprise the COVID pandemic has forced many companies to take a hard look at their supply chain and its ability to react quickly to global needs and fluctuation in consumer behavior. Having an agile infrastructure and solid employee engagement to support it are crucial components to success.

When you examine the other side of the equation, consumers, it becomes clear that their expectations are rising. Consumers are connected and informed, and they demand high-quality, individualized products and same-day delivery. This behavior, first seen in business-to-consumer industries, has migrated to business-to-business markets. Meanwhile, the direct-to-consumer channel is shepherding this attitude to manufacturers. The phrase “the customer is king” has never been more relevant than it is today.

As a result of issues like the global pandemic, cross-company collaboration in the supply chain has become the norm in the worlds of design, distributed manufacturing, and logistics networks. Yesterday’s suppliers are turning into today’s operators. The impact of this new way of business is that it blurs company boundaries and drives an expectation of more-sophisticated collaboration between supply chain networks, all the way from suppliers to manufacturers and logistics providers to retailers and consumers.

Furthermore, as companies realize that a great customer experience hinges on a perfect order, product, delivery, and service experience, the boundaries between R&D, manufacturing, and logistics and operations will continue to dissolve in 2021 within the enterprise and across supply chain collaborators.

Lastly, the rise of the industrial Internet of Things (IoT) technology, blockchain, and machine learning both enables and creates a stronger consumer expectation. This transitional period is characterized by companies increasingly striving to not only break organizational silos, gain visibility, and drive customer centricity but also to achieve much higher levels of efficiency and optimization, and ultimately, introduce new business models is now a consumer-driven requirement versus a potential technical capability.

Businesses that harness these trends and technologies are known as intelligent enterprises.

How Technology is Empowering the Intelligent Enterprise

How will supply chain systems rise to all these challenges? Supply chains have evolved from linear to networked, from mass production to a lot size of one, from manually operated to digitally connected, and now, to a critical component of a company’s business strategy and revenue growth plans. Whether the desire is to adapt your production, design smarter customized products, deliver the perfect order, offer services versus products, or create a circular economy, the best supply chains will focus on these key areas of intelligence:

  • Agility in Infrastructure and Employee Engagement: IT systems and teams must be able to react quickly, and employees must be given proper training to adapt systems and workflows.
  • Customer Centricity: Systems that can sense, react and respond to customer needs on the fly and drive the delivery of individualized products without sacrificing scale or speed.
  • Sustainability: Developing operating models and supply chains that embrace resilience, with the ability to withstand shocks and capture emerging opportunities faster and more effectively than competitors. Key capabilities for achieving this are total visibility across the supply chain, flexible response management, and simulation of alternative supply chains.
  • Productivity and Total Visibility: Deploying an open platform with a shared data model that all systems can plug into to offer companies a fully interoperable portfolio across an interconnected network of partners.

Cloud, big data, and the IoT are required enablers of this digital transformation. The technology related to embedding sensors in machines with connectivity to transmit data has advanced tremendously. Furthermore, the cost of sensors and power consumption has dropped, while connectivity has become ubiquitous. The result is that every “thing” – from industrial equipment, to plant operations, to every imaginable consumer product – is now connected and sharing data.

Automation and built-in intelligence make a difference in every aspect of your business, enabling supply chain managers to be more agile in adapting processes and scaling to meet demands. These technologies help enterprises deliver individualized products and services with the efficiency of mass production, invent new business models in times of need, disrupt your industry before anyone else does, and devise brand-new, differentiating service offerings.

Real-time data from smart products can predict and solve problems. Technology can dampen and repair breaks before they issue. The technology is here today to help your enterprise develop a clear advantage. The winning companies will adapt and evolve to become their own intelligent enterprise.


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John Tully

John Tully is the managing director of the South region for SAP North America. Applying his 20 years of software sales experience and placing a high priority on customer success, John is responsible for driving sales, growth, and leading the development and execution of the region’s go-to-market and people strategies. Prior to joining SAP, John worked in a number of software field sales positions with companies such as Blue Martini Software (acquired by RedPrairie Corporation) and Platinum Technology. John graduated from Auburn University in Auburn, Alabama, with a bachelor’s degree in economics. He currently serves on a University of Texas board that focuses on Big Data and analytics research.