Most anyone involved in supply chain management can testify to the evolving and ongoing complexities associated with operating within a global supply chain.
As global consulting firm KPMG said when describing expected supply chain trends for this year, “Disruptions to supply chain operations are set to stay in 2023, whether they be existing or new geopolitical conflicts, inflationary pressures and the recessionary environment, climate change weather events, or other issues yet to emerge. They can all impact access to goods and how they flow to their final destination, create port holdups, reduce container and ocean freight availability, and surge prices, among other concerns.”
In this context, evolving supply chain technologies are increasingly important solutions that supply chain leaders are counting on.
In the intro to its “2023 Digital Trends in Supply Chain Survey,” global consulting firm PWC captured the dynamics involved.
“Between an increasingly digital world and persistent operational disruptions, the effective use of technologies in supply chains has become more critical,” PwC said. “In addition to lowering costs, improving efficiency and building resilience, digital investments can mitigate risks and address environmental, social and governance (ESG) issues.”
In that light, we decided to take a look at what additional experts have identified as the top supply chain technology trends for 2023.
Gartner
In a May 10 announcement, global consulting firm Gartner said growth and performance will be the priorities for supply chain leaders this year — and many will be counting on technology to achieve it.
“As organizations place greater emphasis on supply chain management, Chief Supply Chain Officers (CSCOs) intend to grasp their collective opportunity to invest in growth through new technology investments,” Gartner said.
The survey of 499 supply chain leaders from October through December 2022 in North America, Latin America, Western Europe and the Asia/Pacific region revealed that 65% of those who responded expect it to be “easier to fund new technology investments” and that, on average, 73% of supply chain IT budgets for 2023 will be “allocated to growth and performance enhancements.”
“The last three years of uncertainty have blurred the line between business and technology strategies to the point that they must be considered together,” said Simon Jacobson, VP Analyst in Gartner’s Supply Chain Practice. “Supply chain leaders must have an understanding of the strategic, disruptive and unavoidable technologies that will impact their planning processes over the next five years.”
Jacobson said that “three key motivations among supply chain leaders” aided in the categorization of the top technology trends identified for 2023:
-
To “pioneer new forms of engagement”
-
To “optimize for resilience”
-
To “scale performance that enables technology to be delivered ‘any place and any time’”
Based on survey results and these three categories, Gartner said the top technology trends for 2023 are:
-
Actionable AI
-
Smart Operations
-
Mobile Asset Optimization
-
Industry Cloud Platforms
-
Employee Engagement
-
Composable Application Architecture
-
Cyber Resilient Supply Chains
-
Supply Chain Integration Services
In the following, we’ll lay them out within the three categories Gartner identified, along with brief descriptions. For full descriptions, please see the announcement.
“Pioneer new forms of engagement”
Actionable AI: “Actionable AI delivers better data-driven decisions by mimicking the problem solving that humans make by augmenting decisions and keeping humans in the loop for validation purposes. …”
Smart Operations: “Smart operations extends the preexisting concept of smart manufacturing to encompass all core operational capabilities, including manufacturing, service and logistics that span warehousing, transportation and global trade. …”
“Optimize for resilience”
Mobile Asset Optimization: “Mobile asset optimization maximizes the use of an enterprise’s mobile assets by combining business process software, sensory technologies and operational research techniques for optimization and business intelligence. …”
Industry Cloud Platforms: “Industry cloud platforms combine software as a service (SaaS), platform as a service (PaaS), and infrastructure as a service (IaaS) with specific functionality for vertical industry use cases. …”
Employee Engagement: “Employee engagement is broadly a set of tools and applications used to help companies improve frontline worker performance, satisfaction and retention. …”
“Scale performance that enables technology to be delivered ‘any place and any time’”
Composable Application Architecture: “Composable business applications are designed to follow the core design principles of modularity, autonomy, orchestration and discovery, with a specific business use case. …”
Cyber Resilient Supply Chains: “…Cybersecurity represents the tools, processes and governance methods (mechanisms) needed to mitigate cybersecurity risks caused by the extreme heterogeneity of supply chain technologies and ecosystem participants.”
Supply Chain Integration Services: “Supply chain integration services encompass technology platforms, integration teams, strategic decision making on which applications to connect when and how (different integration strategies), and finally, cloud services to manage these integrations. …”
Association for Supply Chain Management
In its list of “Top 10 Supply Chain Trends in 2023,” the Association for Supply Chain Management (ASCM) also predicted that technology in various forms will lead the pack.
In a summary of the report, the ASCM said this year’s “key topics” include:
-
Big data, advanced analytics and automation: “Big data, analytics and automation enable organizations to mitigate disruption via digital supply chain management. Organizations that harness the power of these solutions will benefit from greater visibility, synchronized planning and execution, data-driven decision-making, predictability, agility and profitability.”
-
Smart logistics, robotics, the internet of things: “Labor shortages, supply disruptions and demand surges are compelling organizations to tap into robotics — and, as a result, smart logistics solutions based on the internet of things and next-generation robotics are becoming a focal point of future supply chain design.”
-
Artificial intelligence and machine learning: “Artificial intelligence and machine learning are a driving force for integrating systems by enabling interoperability across various business landscapes. They are foundational to integrating people, processes and systems in different operational environments.”
KPMG
Among the supply chain trends KPMG predicted for 2023, the firm said it expects an acceleration of supply chain technology investments — as well as an increase in cybercrime.
Acceleration of supply chain technology investments
Noting that “investing in a cloud-based digital transformation strategy was a key trend” over the past year, KPMG said this trend will likely pick up speed in 2023 “as organizations seize technology as a strategy to mitigate their growing concerns around inflationary pressures and economic stagnation.”
“While technology transformation often focused on the back office and better customer engagement, supply chain and operational capabilities will be front and center in 2023,” the firm said. “Importantly, there will likely be greater investment to uplift supply chain planning maturity, automation of warehouse and operational tasks, as well as in gathering better end-to-end supply chain analytics to create enhanced visibility.”
Increase in cybercrime
Predicting that cyber criminals may become “even more sophisticated when it comes to infiltrating supply chains to damage or steal from businesses” in 2023, KPMG noted that the supply chain is prone to vulnerabilities that make it possible for entry by external parties — which is especially true when it comes to a company’s supplier network.
“Criminals could also hack in through basic warehouse equipment such as a barcode reader or via Internet of Things (IoT) devices applied within your manufacturing and other operational sites,” the firm said. “Cyber risk will likely be compounded if you rethink your supplier networks and make changes to friendshore/nearshore, or invest in new technologies.”
For KPMG recommendations about key actions to take related to these trends, please see the full post.
