Key Supply Chain Trends in Manufacturing
“Supply chain disruption due to the pandemic” is a phrase we have heard over and over this past year. Production lines came to a standstill and the question of how to prevent such scenarios in the future came up.
Last year’s digitalization push will continue into the current year. Machine learning plays a central role here. So does an intuitive user experience, which is expected especially by young professionals because they have grown up with modern technologies. In addition, more and more manufacturing companies will move to combine planning and execution in one solution so that supply chain disruptions can be better anticipated in the future and countermeasures can be taken in time.
Here are five key trends in manufacturing that I see for the upcoming year:
Trend 1: The level of automation will continue to increase
After the pandemic has shown how disruptive global supply chains are and how quickly decisions need to be made to address challenges, companies will increasingly outsource such processes to the machine. Machine learning solutions help identify where delays or failures may occur. They can even break this down to individual loads and predict which delivery is at high risk of failure. Should a breakdown occur, deliveries can be automatically rerouted thanks to the algorithms. So the entire process from planning to ad-hoc execution can be automated.
The algorithms can also prioritize where goods are needed most urgently and when, so that production and delivery commitments can be met. Human workers need days to make such decisions and get an overview as a basis for decision making. The risk of introducing even more errors and making the wrong decision can be very high. Reason for this are time pressure and large amounts of data. In addition, manual planning processes typically run sequentially. So one planning step after the other is done, which takes a lot of time. The machine, on the other hand, can deal with such things unemotionally and quickly makes the right decision based on data.
Trend 2: Faster integration of cloud services
The trend toward the cloud is not new in the field of industrial manufacturing. Equally unsurprising is the assessment that this trend will continue.
Integration into existing systems, especially existing cloud systems, is no longer an argument against cloud-based solutions. Due to advanced APIs and the move away from on-premise systems, new cloud services can be integrated and customized with fairly little effort. As new cloud applications enable higher levels of automation, we will see a correlation here. More cloud equals more automation.
Trend 3: Data Scientists are the new rock stars
More automation requires better data quality. As we know, data is available in the company; however, it is siloed across all departments. Gathering, formatting and harmonizing data in such a way that it can be used to automate processes is a challenging task. Breaking down these silos is becoming increasingly important in order to make supply chains more efficient and more resistant to disruptions. This allows automated data-driven decisions to be implemented more quickly.
In addition, well-structured and prepared data in the cloud enables the convergence of solutions in just one application. An example here is the merging of supply chain planning and supply chain execution. Unified data in a holistic solution that is used across departments gives a better overview of all activities along the supply chain and simplifies the automation of processes. The data scientists who help implement such projects become the heroes of the supply chain.
Trend 4: Applications focus on the user
We will not only see technological changes, but also socio-structural ones. The baby boomer generation is gradually retiring. Henceforth, millennials are entering the business world with their own ideas about what technology must do and how it can best be used. These young people have grown up with the internet, with mobile technologies and also with cloud services. They expect to find these in their everyday working lives.
Another important aspect here is the user experience, which places new demands on UX design. Solutions will be successful that have intuitive graphical user interfaces that use dashboards and diagrams to provide a quick overview of what is happening along the supply chain. Table-based user interfaces, which are familiar from many software solutions and have always been considered less user-friendly, will disappear. Applications that continue to rely on such unappealing user interfaces will have a hard time making the short list when legacy solutions are replaced by new cloud services.
Trend 5: Planning and execution from a single source
Speed is becoming an increasingly important factor in the supply chain. Automation is part of the equation, and cloud applications are making supply chain management processes faster. One of the reasons for this is the possibility of harmonizing the previously separate areas of supply chain planning and supply chain execution in one application. Possible process breaks and a struggle for responsibility and competence are thus a thing of the past. In addition, an ML-based application that can forecast disruptions will work more reliably if it uses planning data from the same application. This will increase supply chain efficiency and give employees a better overview, as both supply chain disciplines will find each other in one application. Ultimately, this will lead to increased customer satisfaction.