From new technologies to changing tariffs, a host of new factors are impacting supply chain management. For 2019, thought leaders in supply chain management point to these and other developments that outline the future of supply chain management.
From Internet of Things, artificial intelligence and blockchain to autonomous vehicles, 3-D printing and drones, David Dreyfus, assistant professor in the supply chain management department at Rutgers University, identifies technology as a primary force shaping supply chain management's future.
Supply chain managers will enjoy better shipment tracking and authentication with IoT and blockchain, Dreyfus says. AI will yield superior demand forecasts, while autonomous vehicles work 'round the clock and cloud-based collaboration platforms tighten integration with other supply chain members.
3-D printing will provide alternatives to last-minute, high-cost shipments to hard-to-reach locations and drones will assist with fleet management and other chores–although Dreyfus says large-scale drone deliveries will likely happen in other countries before the U.S.
Small and medium-size businesses preparing to leverage new supply chain technology should focus first on making sure they have clean data on relevant measurements, he says. “If you're not measuring the right things and don't have good data, then all your outputs and insights are not going to be actionable," Dreyfus cautions.
Social and Policy Changes
The mushrooming sharing economy could exert significant influence on supply chain management before long, according to Amy Xia, associate professor of business analytics at Raymond A. Mason School of Business at William & Mary. “Companies may use Uber delivery or personal truck and car owners for last-mile delivery," Xia says.
Five years ago, sustainable supply chain knowledge was a nice-to-have, and now it's a must-have.
–Abe Eshkenazi, CEO, Association for Supply Chain Management
Cooperation among members is another change Xia sees as potentially impacting supply chain management's future. “Buyers may combine their purchasing power," she says. “Vendors and sellers may manage inventory for the buyers."
Widespread social concerns about sustainability that guide other aspects of business may increasingly weigh in here as well. “Environmental issues and social responsibility issues will be further considered in supply chain management," Xia says.
Xia also sees developments in laws and regulations as having potential to steer supply chain management's future. “The recent tariff war is significantly influencing supply chain management," she says. “And once emission trading policies or carbon footprint rules are adopted, or autonomous automobiles are allowed in transportation, supply chain management will be severely influenced."
Supply Chain Careers
Rick Blasgen, president and CEO of the Council of Supply Chain Management Professionals not-for-profit association based in Lombard, Illinois, says important changes are coming for people working in the field and considering it for employment. “We're going to see and are seeing senior supply chain leaders become general business leaders and CEOS," Blasgen says.
He also sees imminent improvements in the outlook for college-level supply chain management education and in the field's appeal to students and would-be professionals. “I think it's going to become a destination career for young people," Blasgen says. Business majors in supply chain management programs receive job offers months before they graduate, he says, and enjoy excellent long-range advancement potential.
To go with the increased opportunities, supply chain managers will likely be taking on more complicated and sensitive tasks as global supply chains expand to new countries and continents where political, economic and other risks rise, he adds. “That makes us become risk managers as well," Blasgen says. “It's risky to have products and raw materials coming from all over the world."
A Higher Profile for Supply Chain Management
While they tackle the challenges of accommodating these emerging trends, supply chain managers also will be called upon to respond to a shift in the way their organizations view and value what they're doing, says Abe Eshkenazi, CEO of the Chicago-based Association for Supply Chain Management.
“Whereas it used to be seen as a way to impact the bottom line, supply chain is now an integral part of overall business strategy," Eshkenazi says. “For example, five years ago, sustainable supply chain knowledge was a nice-to-have, and now it's a must-have. Businesses are starting to see the incredible advantage that can be gained through strategic supply chain management and leadership."
Like the other thought leaders, Eshkenazi points to disruptive technologies, tariff tussles, sustainability concerns, a talent shortage, laws and regulations and geopolitical and economic risk factors as part of supply chain managers' challenges going forward. And he says that these challenges will be faced by nearly any company in any field.
Citing figures from a 2018 Harvard Business Review article, Eshkenazi says the supply chain economy may contain 37 percent of American jobs, employing 44 million people. “When you look at it this way, there is not an industry supply chain doesn't touch," he says. “Supply chain innovations cascade and diffuse across the economy, increasing the overall value of those innovations."
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