Is Your Supply Chain Ready for 2020?

Supply Chain Trends 2020 Blog Article

Are you prepared for the future? 2020 is no longer in a science fiction movie. It is now.

We are facing a volatile economic environment in which change is the only certainty. Global trade, geopolitics, climate changes, epidemics, natural disasters, digitization, the increasing demand for customer flexibility and the volatility of consumer demand increase supply chain complexity. Supply chains are no longer chains but a hyper-connected network of opportunistic demand, supply, and capacity entities.

Supply chain planning has become a competitive weapon in our modern, connected and digital world. Let’s focus on some 2020 supply chain trends and initiatives.

Sustainability

The idea is simple: rethink the supply chain to eliminate the ecological impact and preserve the environment every step of the way from design, material sourcing, production and the recycling and restoration of end-of-life products.

Transforming to a green supply chain is a strategic choice, and brings many competitive advantages to a company. First of all, it allows a definite improvement of brand image with customers and business partners. A clear and genuine sustainability strategy is a competitive differentiator.  Sustainable brands are perceived better by consumers leading to greater success. A green supply chain reduces operational costs by optimizing resource value in the supply chain. Recyclable raw materials, manufacturing processes limiting the consumption of water and electricity, eco-responsible packaging and less energy-consuming transport solutions are all growth drivers and also help reduce production cost and wastage.

Agility

Supply chain disruption can be caused by several factors: climate changes, natural disasters, new tariffs and global trade issues as well as fatal and transmittable diseases such as recently the coronavirus in China. To ensure stability and maintain their service levels, companies will need to be more agile in terms of supply chain planning. Plan for the risk. A good practice to measure the risk impact is to model it. What if there is a cost increase from a trading country imposing trading tariffs? What if there is a short term supply constraint due to a natural disaster? Scenario planning, also known as “What If”, will help supply chain managers to identify potential problems, have better visibility of their global supply chain at a strategic and tactical level. A comprehensive end-to-end scenario management process will support complex scenarios modeling and use balanced scorecards to identify the plan that best deals with a given situation and make better decisions

How to Achieve the Desired Outcome. Not every intention turns out the way it was intended. Scenario management provides the ability to try alternate initiatives to re-align the plan with corporate objectives. The impact of every plan change can be measured in terms of adherence to corporate objectives.

The alternate what-if scenarios are crucial input into the pre-S&OP meeting for stakeholder consideration.

Digital 

Data, information has become a key resource for all businesses. However, its abundance and the speed with which it is generated create real challenges for companies. Supply chain digitization has been underway since 2010 and 2011, with an acceleration since 2014. According to CapGemini, one in two companies consider supply chain digitization as one of their top three organizational priorities and according to IDC, by the end of 2021, half of all manufacturing supply chains will have invested in supply chain resiliency and artificial intelligence (AI), resulting in productivity improvements of 15%.

Companies are mobilizing their strength, but many consider the lack of internal skills as an obstacle to the implementation of a digital solution. Recruiting the right talent and implementing the right change management policy are the key issues. Overall, the development of Big Data and data sharing (Cloud, Blockchain, IoT, Analytics, AI, …) is pushing companies to accelerate today. For many of them, this milestone has been reached. Now is the time to act.

Talent

You have probably wondered what jobs your children will do in the future? Generation Y and the Millenials now form 50% of our workforce. and are gradually transforming the world of work. This is the first digital generation. The first to have grown up in the digital revolutions with immersive exposure to the internet and social networks. It is also a generation that challenges many established norms: family, gender, politics, social relationships, and of course, the world of work.

Another big trend is the increase in women in supply chain roles. A recent survey published by Apics and ASCM shows roughly two-thirds (61%) of males and one-third (39%) of females are working.

Millennials are changing the traditional face of the supply chain. This highly educated generation is entering the market with more analytical and technical interest, using for example statistics to interpret real-world situations. They are connected, digital and environmentally friendly. 

No doubts, our world, our planet are changing faster and faster. Are you ready for 2020 supply chain challenges?

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