As the Great Supply Chain Disruption continues to roil the global economy in 2022, the imbalance of supply and demand caused by Covid-19 is likely to continue as more businesses battle empty shelves, labor shortages… etc.
However, developments like the increase in digital procurement and reshoring, which have heightened due to the recession, are ultimately going to benefit local and global markets.
Nevertheless, businesses that want to overcome labor challenges, diminish risk, and identify ways to stay ahead of the competition must reevaluate their operations to stay ahead of key trends in 2022.
Today, businesses are working to digitize supply chains and incorporate artificial intelligence to ensure more efficiency. Digitizing supply chains will give businesses the flexibility to respond to market changes or supply chain disruptions.
By automating procedures using algorithms that can identify patterns and analyze data, businesses can eliminate human errors and predict purchasing demands. They can also eliminate guesswork and the need to perform similar calculations over and over.
In addition to delivering more accurate data, AI can help supply managers to analyze and make informed decisions faster. Cloud-based operations will also allow employees to work remotely and in hybrid models.
Due to labor shortages, companies are looking to robotics to try and automate order fulfillment. Robots can play a huge role in enhancing savings and efficiency in supply chains and SCM. In 2021, the number of robots sold rose by 21% compared to 2020.
Many companies are using driverless vehicles and drones to streamline logistics, and in the near future, drones are expected to become fully capable of delivering small goods across the US.
Robotics and automation can help around the warehouse by picking, packing, and sorting orders, in addition to unloading, loading, and stacking materials. This can speed up labor-intensive tasks, hence improving productivity.
Supply managers are slowly replacing their linear supply chain strategies to implement circular chains, which involve refurbishing discarded products for sale.
To combat the rising cost of raw materials, manufacturers use old and discarded products as raw materials. In addition, a circular supply chain system reduces waste from manufacturing companies, enhancing sustainability goals.
Online shopping has boomed, especially during the Covid-19 pandemic period. By 2025, 80% of B2B sales are expected to be made through digital channels. So, businesses must adapt their supply chain for e-commerce.
The primary goal of many companies is to ensure the efficiency and resilience of the supply chain. This means avoiding stockouts and ensuring that customer demand is met with fast deliveries.
According to Innovation Driven Resilience, 45% of businesses use innovative tools to accurately balance stock levels. If businesses adapt to e-commerce, they can maximize profits and tap into the global digital market.
Talent plays a critical role in supporting innovation, finding solutions, and designing frameworks. As companies find new ways to manage problems, employees across all departments are expected to learn new ways.
To encourage this, employers will consider providing training, better pay, benefits, and hiring talent with foundational skills such as data analysis.
Companies will also seek to globalize the workforce with many manufacturers having multi-country operations. Remote workers allow emerging companies to find the best talent while on a budget.
As consumer concerns about the impact of business practices on the environment, global economy, and social structure increase, companies need to be more transparent about supply chain externalities.
Many companies have begun becoming more transparent about sustainability and their efforts to reduce carbon footprint. Governments are also expected to start demanding companies to disclose reports on the impact of the supply chain on jobs created, sourcing practices, and modes of transport.
In addition, in efforts to capture new markets and satisfy customers, businesses will seek more visibility through online media and other supporting technologies.
As companies transition to robotics and cloud computing, cybersecurity becomes a priority. They must invest highly in making sure that their data and infrastructures are safe from external interference.
The exposition of data and data-driven infrastructures creates areas of vulnerability, and interconnected organizations can make it easier for hackers to breach security and steal critical information.
Therefore, companies are more likely to collaborate to safeguard their devices, networks, and programs. Many might also adopt more secure modes of payment such as cryptocurrency.
To ensure business sustainability, companies will focus on their customer needs rather than profit. Since many people are interested in climate change, there’s increased scrutiny as consumers demand ethical and greener business practices.
In addition, consumer expectations continue to expand as they have more alternatives to choose from. To ensure a successful supply chain, managers will have to retrain their employees to understand how to manage customers. Those who will meet the consumer expectations at the lowest cost will prevail.
Companies are utilizing the Internet of Things in their infrastructures to enhance the visibility of the supply chain. For example, airplanes, motorbikes, and drones are fitted with trackers that provide live updates on the shipping and delivery of products.
The Internet of Things also helps to increase visibility in production, inventory management, and activities in the warehouse, including predictive maintenance. Companies will use this live data to meet customer demands and minimize downtime.
Businesses must also ensure supply chain agility when creating flexible networks that can handle the increasing consumer demand and withstand the ever-increasing uncertainty. For instance, companies with one supplier struggled when that company could not meet their demands.
Companies that can react quickly to changes, delays, and unexpected events to meet customer demands and drive growth will eventually prevail. This requires data analysis, innovation, and collaboration among global networks.
Due to labor shortages in 2022, companies are more likely to adopt talent management faster to combat the pressing issue. The remote and global workforce will be adopted faster as many companies lack the capital to hire in-house workers and as millennials surge into the job market.
The demand for products is highly likely to increase, hence it’s incredibly important to keep your inventory. If you need assistance with inventory forecasting and supply chain management, StockIQ can help. Reach out to us today and find out what we can do.