Technology is a boon for the world as new technology is developing in corners of the world. Decades ago, human life was full of problems that needed to be solved, and technology provided innovative solutions to those problems that reduced effort and increased efficiency. Generally, Technology is the use of scientific knowledge for practical purposes that benefit our everyday lives, as well as the industries created by humans. Technology is serving the world in a lot of sectors and industries.
Where all industries have an important aspect that is called supply chain management. Supply chain refers to the whole process of converting raw materials into useful products and supplying them to customers by different processes. But as the world is growing too rapidly, the needs of products are also growing at a faster pace and conventional supply chain management techniques are not enough to fulfill the needs of the world. There is something incredible needed to maintain the balance and technology is that thing that can do and even is doing at many corners of the world for different industries' supply chains.
Currently, 63% of companies do not use any technology to monitor their supply chain performance, and only 37% use technology to enhance their supply chain.
These stats need to improve and this can happen by making industries aware of the technology capability and power. In this article, we will see detailed information on how technology is shaping the future of supply chain management and how it can be beneficial to those who are still not using it.
The Global Impact of Technology on Supply Chain Management
Technology is a seamless thing to enhance the supply chain management system of the global industries. Different kinds of technology enable automated processes, data-driven decision-making, predictive manner, and many other incredible things. Surely technology is making an impressive impact on supply chain management at the global level.
For example, today artificial intelligence is used by 14% of the industries to optimize their supply chain, which is expected to increase to 74% in the next 5 years. Many technologies are being used at a low percentage but surely will increase.
Top Technologies to Enhance Potential of Supply Chain Management
There are a lot of technologies across the globe that have the potential to enhance supply chain management. Here are a few important technologies mentioned below that can evolve for supply chain management in industries.
Automation
Automation is a technology that automates the process and reduces the labor work. Automation solutions are also concerning as this technology can kill the job for workers but it has optimized the existing workflow, allowing human labor to be employed for more meaningful tasks.
Artificial Intelligence and Machine Learning
Artificial intelligence and ML is also an incredible technology that has the power to think and process results. This helps to automate tasks like data collection, creating reports and planning can be relegated to the software in supply chain management. Artificial intelligence in the supply chain market is expected to reach USD 10,110.2 million by 2025 from USD 730.6 million in 2018, at a CAGR of 45.55% during the forecast period.
Smarter Warehouse
An increased amount of effort is being put forward at the moment to make warehouses "smarter." This comprises the utilization of Internet of Things and RFID for the purpose of improving data transfer and eliminating blind spots. The ability to trace shipments at any time is made possible via geotagging and GPS technology.
The digitization of significant papers also makes the process more efficient and safer, which is a significant advantage. It is also possible to automate certain processes in the supply chain by utilizing, for example, smart contracts.
This allows for the automatic processing of payments based on a variety of triggers, such as a QR code scan, an NFC scan, or even a temperature or geolocation trigger from an Internet of Things device. By optimizing their inventory, businesses are able to more accurately evaluate customer demand and better align their supply with that demand.
Layering and Integration of Technology
Earlier there were options to use only one technology at a time but now it is possible to combine many technologies which is generally called integration of technology. This enables new and more accurate results for supply chain management.
Blockchain Technology
Blockchain technology is by no means a novel phenomenon. The volatility exhibited by cryptocurrencies last year may have diminished the enthusiasm surrounding blockchain, but the technology is thriving in a variety of industries. The supply chain industry has been significantly transformed by this innovation, owing to the visibility and traceability of data it provides throughout the network.
The distributed ledger guarantees that all parties have access to the most recent information while maintaining absolute confidentiality. Additionally, cryptocurrencies founded on the blockchain can facilitate seamless cross-border transactions.
Advantages of Technology To Manage the Supply Chain
As there is a lot of technology with a lot of capabilities available, there are also a lot of advantages of technology available for supply chain management. Here are a few important advantages mentioned below.
Reduced Cost
The use of technology significantly affects the cost of the company as labor costs will reduce and profit will increase. This also allows workers to do other more complex tasks than wasting time on easy ones.
Inventory Management
Better inventory management is also beneficial due to the use of technology as less production and greater demand can be issues that need to be balanced. The use of technology generally automates processes and at a faster rate balances the demand and production.
Analytics
Proper analytics of data lets you make the right decision-making as technology in supply chain management can help you to provide data analytics better. Artificial intelligence can process data that has been extracted with the help of IOT devices.
Improved Supply Chain Communication
Supply chain management cannot be successful without adequate and effective communication. Technology allows a seamless flow of communication that improves the understanding between the employees and workers and overall makes a positive impact on the supply chain.
Applications of Technology in Supply Chain Management
Technology can be applied in various forms in supply chain management. This is not necessary because technology only implements in its original form as can be used to make other types of technology. Here are some use cases of technology mentioned below that enhance supply chain management.
Electronic Data Interchange
Electronic Data Interchange (EDI) is an electrical information applicable technology based on computer and data communication network technology. By using EDI, producers, suppliers, retailers, wholesalers, and final customers can be organically bound together, business growth in the supply chain can be improved and regularized, cost reduced and supply time shortened.
Barcode Technology
Barcode technology is an important and quick information-collecting technology. The application of barcode technology resolves the data entering and data collecting problems, which can greatly improve the efficiency of flow and provide support for the management of the supply chain.
Database Technology
In supply chain management, database technology can better manage stocking information, and customer material, thus effectively planning, analyzing cost, and decision-making.
Cons of Technology in Supply Chain Management
There are some challenges with the use of technology in supply chain management. Here are some challenges mentioned below.
- Data theft and manipulation are always a risk factor with any technology as strong layers of security can break and private data can be stolen.
- Malware dissemination is also a challenge as if any virus enters the system then can crash the whole system and cause loss of data.
- Some technologies can be costly such as artificial intelligence, IoT, etc that cost too much money to implement.
Conclusion
Technology can keep the survival of supply chain management in a good manner. Surely there are some challenges but they can be overcome with the developing technology. Technology not only helps to optimize the supply chain but also can contribute and contribute to many aspects of the industries. Since this is not the best era of technology and the best has to come, there will be more exciting technology than today. Overall, it depends on the use of technology as this can be a curse if not used properly.
