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In today’s world, disruption to the supply chain has become the new normal. In order to keep up and build resilience in the long run, businesses must turn these disruptions into opportunities by staying ahead of emerging trends and using sophisticated planning capabilities with improved visibility of their supply chain.
We believe these actions are essential for success in 2023 and beyond. Having control over risk and vulnerability will be crucial in setting yourself apart from the crowd and harnessing all that is offered as a result of taking proactive steps.
Supply Chain Trends You Should Know About in 2023
The modern business landscape is highly reliant on supply chains, which require constant attention and optimization to keep operations running smoothly. To effectively adapt to the changing consumer demands and disruptions bred by the COVID-19 pandemic, it is essential for businesses stay informed on supply chain trends and the latest statistics.
Keeping up with these supply chain trends helps ensure that businesses have access to identifying critical components of their supply chains, efficient management methods, and an agile approach to navigating disruptions. It also ensures that they can continue delivering products and services timely while maximizing cost savings.
In short, staying updated on the ever-evolving supply chain landscape is no longer a choice but an imperative for businesses. With that in mind, let us look at some of the supply chain trends that you should know about in 2023.
#1. Greener Supply Chain
Companies have realized the importance of understanding their full carbon footprint and are therefore making deliberate changes to reduce their carbon emissions. These changes have been met with enthusiasm by climate change advocacy groups and consumers.
There are a few main areas within the supply chain that contributes the most to greenhouse gas emissions in the US, such as electricity and transportation. For example, many companies now prioritize energy efficiencies within their facilities as well as sustainable packaging production and renewable energy usage.
Additionally, they’re exploring eco-friendly methods of transportation like swapping out traditional fuel-based vehicles for electric ones or introducing biometric fuels wherever possible. It’s incredible how much support green logistics is getting today; however, there’s still more work that needs to be done in order to combat climate change.
Speaking of green logistics, it has become a key strategy in modern warehousing, driven by both societal and corporate imperatives. The most successful facilities have implemented advanced energy management systems to monitor the usage of valuable resources such as electricity, heat, water, and gas.
This is not only enabling wholesale reduction in waste, but also helping reduce their overall carbon footprint. Thus, it’s clear that green logistics is an important trend in warehousing operations that positively impacts both overall efficiency and sustainability goals alike.
#2. Emergence of Circular Supply Chains
The emergence of circular supply chains is an undeniable shift in the way companies utilize their resources, allowing them to significantly reduce their environmental footprint while increasing efficiency.
More companies than ever are choosing to repurpose discarded products and return them to their raw material form, which helps reduce the costs of raw materials and makes them more widely available.
The potential for waste reduction as well as cost savings makes this a smart business decision, demonstrating that sustainability and financial success do not have to be mutually exclusive. It is clear that linear supply chains will soon become relics of the past as companies adopt this new model for a greener future.
Source: Supply Chain 24×7
Utilizing a circular supply chain is not only a viable business strategy for cutting costs and improving profitability, it is an efficient way for companies to reduce their environmental footprint.
By looping the supply chain, companies can invest in fewer raw materials than traditional supply chains require, mitigating risk against volatile prices. Additionally, by avoiding wasteful practices such as over-production and excess packaging, businesses can do their part to create a more sustainable production cycle with minimal disruption to the environment.
#3. The Shape of Manufacturing is Changing
As the global economic supply chain grapples with energy and input price surges, accessing critical materials in 2023 will be a major challenge. For many of the same reasons, global corporations with manufacturing operations must consider alternatives to traditional offshore manufacturing.
Friendshoring and nearshoring will certainly be on their radar but recognizing that a substantial amount of risk is involved and there may be skepticism as to whether manufacturing can actually be done entirely onshore.
As such, companies will inevitably begin to explore potential solutions – and though this shift isn’t likely to happen overnight, it’s evident that wheels are beginning to turn.
Moreover, another factor that will change the shape of the manufacturing footprint is the impact of online retail. This must be taken into account when mapping out the product manufacturing landscape.
In order to remain competitive, organizations are being forced to provide unique products tailored to individual customers’ needs: whether that means different sizes, flavors or even packaging styles.
Crucially, this trend is mirrored in life sciences with the development of precision medicine; soon healthcare providers may no longer need huge batches of generic vaccines and drugs, instead favoring smaller runs specially crafted for each patient.
The implications of this shift on the future of manufacturing and its associated supply chains will be huge – but also indicative of an exciting new era of technological advancement.
#4. Increase in Technology Investment
As organizations across the world prepare for a future that is drastically different from the past year, investing in a cloud-based digital transformation strategy should be top of mind.
In 2023, this shift towards technology will likely accelerate as companies put their focus on mitigating inflationary pressures and economic stagnation through their strategies. In order to succeed in this transition, organizations need to target multiple areas for improvement.
Enhancing supply chain planning quality and automating warehouse and operational tasks will be essential elements necessary for success. Companies must also ensure that they are gathering end-to-end supply chain analytics to create better visibility from an end-to-end perspective.
By taking these steps now, they will set themselves up for success far into the future. Moreover, this move promises some serious advantages for users, allowing them to leverage the capabilities of many systems in one place, eliminating choppy experiences and facilitating smooth operations from end to end.
With powerful potential for greater efficiency, scalability and cost savings, the move into holistic supply chain platforms is certain to be welcomed by its users.
#5. Elastic Logistics are the Way Forward
When it comes to supply chain operations, mere leanness is no longer enough for businesses to survive in a constantly changing market. To remain agile and adaptive, many organizations have decided that elastic logistics are the way forward.
This approach has allowed businesses to expand or contract their supply chains depending on customer demands – allowing them to stay one step ahead of their competitors while taking into account any fluctuating needs.
Furthermore, technologies such as artificial intelligence allow complex business decisions that can ultimately balance supply and demand with ease. Through elastic logistics, businesses of all sizes can achieve rewards of greater cost savings, improved efficiency and an elevated customer experience.
Source: Mobisoft Infotech
Moreover, elastic logistics is an invaluable asset for companies strategizing in a rapidly evolving marketplace. Its adjustability allows supply chain stakeholders to enjoy the fluidity and safeguard against potential issues such as overstocking and unoptimized vessel space, bringing greater stability than is otherwise achievable.
Ultimately, this provides businesses with the agility necessary to remain competitive in the face of ever-fluctuating markets. Moreover, elastic logistics can help them maximize their efficiency by optimizing sailing schedules and container usage as needed.
This multi-faceted approach affords a flexibility that empowers businesses to efficiently manage the complexities of their supply chains.
#6. Supply Chain as a Service (SCaaS)
The complexity of value chains is changing the way businesses do business. Companies now need to switch to digital environments and incorporate large amounts of IoT-enabled devices, data analytics, and maintenance in order to stay competitive.
Though these processes are necessary for success, many organizations lack the specialized skillset needed for managing them. This is why outsourcing has become so prevalent as it allows businesses to access expertise without committing resources to developing it in-house.
With a well-managed outsourced partner running critical supply chain processes, companies can work towards optimization with confidence. Moreover, SCaaS (Supply Chain as a Service) solutions have myriad advantages for businesses today that are looking to stay competitive in an ever-changing economic climate.
Chief among these benefits is improved customer service and increased productivity, allowing companies to reduce costs while maintaining optimal levels of operation. SCaaS also includes specific supply chain benefits such as improved asset management, providing business owners with increased confidence in their service delivery process.
Furthermore, the current pandemic landscape has shown the need for greater flexibility, resilience and agility–all qualities that SCaaS excels at offering. As a result, businesses can now equip themselves with the necessary tools to survive and thrive during uncertain times.
Why Is Investment in Long-term Resilience Key to Securing a Sustainable Future?
In the past year, leaders of public and private sector organizations have been presented with a unique learning opportunity – recognizing that the future will be defined by interconnected disruptions.
COVID-19 impacted every industry and region in different ways; striking some harder than others while simultaneously exacerbating systemic socio-economic inequalities.
As organizations look to weather the ongoing disruptions, leaders must come together to develop innovative approaches that embrace complexity, collaboration and compassion.
Finding short-term solutions to address current challenges may feel like an urgent priority, but it is also essential that we develop longer-term resilience strategies leveraging holistic perspectives in order to proactively manage future disruptions and enable sustainable progress.
With the long-term aspect in mind, let’s now take a look at areas that need to be addressed to build a sustainable future.
#A. Geopolitical Resilience
The geopolitical landscape is constantly in flux, and an organization’s ability to respond to these changes and remain resilient requires proactivity. That’s why it’s important to develop robust business strategies that can adapt flexibly to different geopolitical spheres, as well as enhance foresight capabilities to better predict changes and plan accordingly.
Additionally, developing a deep understanding of economic and geopolitical interdependencies enables businesses to collaborate with policy-makers in more meaningful ways. Smart companies recognize the importance of building geopolitical resilience into their core infrastructure, so as not to become blindsided by future events.
#B. Climate, Food, and Energy Resilience
Climate, food, and energy resilience are pressing concerns for today’s society. Heading into the future, it is clear that utilizing renewable sources of energy can no longer be delayed and must receive increased emphasis in order to make substantial progress.
Alongside this transition, complementary technologies such as blue hydrogen and carbon capture, use, and storage may help provide a bridge between traditional fuels and full decarbonization.
However, we must not forget that the protection of our delicate natural environment also plays an essential role in this new era – conservation projects coupled with incentives for transition funding may help us to minimize climate impacts while ensuring inclusive growth.
Therefore, if we prioritize food and basic needs within these initiatives, we will have taken a crucial step towards successfully confronting the global challenge of climate change.
#C. Trade and Supply Chain Resilience
Trade and supply chain resilience is of paramount importance in today’s global landscape. To ensure that businesses are well-protected, it’s essential to understand supply chain dependencies and potential vulnerabilities stemming from geopolitics, technology, or single sourcing.
In addition, the ability to preserve beneficial supplier relationships while interconnecting on a global level is incredibly significant. Moreover, by taking proactive measures–such as early sensing and scenario planning–organizations are able to recognize and plan for risks that may be lurking over the horizon.
Finally, creating fair trade opportunities for smaller or developing economies can give them additional support to reach new heights.
#D. People, Education, and Organizational Resilience
The ability to successfully face ups and downs is the very essence of resilience. As far as organizations are concerned, however, it also involves taking into account the different variables that guarantee sustainability in the long run, including people and education.
To ensure organizational resilience, it is important to cultivate flexible operating models and adaptable leadership capable of embracing uncertainty. Moreover, decision-making should be decentralized so teams can progress with more autonomy.
Additionally, a long-term talent development strategy must be implemented to upskill and re-skill the existing workforce whenever necessary. And last but not the least, investing in education is essential both to reduce the growing talent gap and social inequality in society.
#E. Healthcare Resilience
Developing healthcare resilience is a critically important goal in today’s interconnected global world. To achieve this, it is essential to prioritize preventative and holistic health as well; not only should medical care be accessible and affordable, but efforts must also be made to decrease the risk of disease through the promotion of healthy behaviors.
Additionally, with increased capacity and productivity within the healthcare system along with improved resistance against future pandemics and health crises, we can create resilient social structures that will protect those who are most vulnerable.
Furthermore, we must ensure inclusion and equitable care for all members of society to truly achieve healthcare resilience: no population should be excluded from access to quality care.
#F. Digital and Technological Resilience
Digital and technological resilience is integral to achieving resilience and staying competitive in the long term, yet many organizations are often intimidated by the high costs associated with implementing digital solutions.
Not only must organizations be willing to commit to increased operational expenditure, but they must also invest additional capital expenditure in pilot projects and industrial deployment initiatives.
Moreover, this heightened cost perception is exacerbated by limited access to funding sources, as well as a general lack of awareness regarding prevalent technologies and their associated financial benefits.
Consequently, any successful integration of digital technologies should include strategies that address these challenges – a fact that smart organizations have recognized if they wish to remain resilient in the current technological landscape.
3 Enablers to Have in Place Due to the Supply Chain Trends of 2023
As the supply chain shifts and the supply chain trends in 2023 reach their full potential, businesses will be in need of some enablers for effective supply chain management.
The first of these is capability. With the digital economy driving global development, businesses need warehouses and transportation networks both online and offline to stay ahead of customer needs.
Agility is the next element. In future, organizations should stay prepared to deal with unexpected risks and their frequency and severity are only predicted to increase, which will also increase competition. The ability to react quickly to changes in demand or disruptions in the market will be a critical success factor in the future.
Finally, businesses must stay up-to-date with visibility into data; accurately predicting consumer behavior requires complex analysis and granular insights into operations and inventory.
With forethought and careful consideration of these elements combined, businesses can ensure their supply chain is adaptive, agile, and ready for whatever the upcoming years has in store.
Closing Thoughts
Supply chain disruptions are going to be a constant. Under these circumstances, to position themselves for success, companies need to proactively manage these trends.
We believe, advanced planning and flexibility, achieved through better end-to-end visibility of the supply chain, will help companies to reduce their risks and exploit opportunities.
Consulting can play a crucial role in helping build supply chain resilience by offering the following services:
- Assessing current supply chain processes and identifying potential risks and vulnerabilities.
- Developing contingency plans and risk mitigation strategies.
- Implementing new technologies and processes to increase visibility and flexibility.
- Providing training and support to supply chain personnel on best practices for risk management.
- Conducting regular reviews and audits to monitor performance and adjust strategies as needed.
- Facilitating communication and collaboration between supply chain partners to improve overall resilience.
While hiring consultants, companies must ensure that their chosen consulting firm has relevant supply chain management experience and a successful track record and also make sure that the problem-solving approach taken by the firm matches their needs.
Moreover, to stay ahead of the competition and ensure consistent success, having dependable suppliers is paramount. When selecting potential partners, it’s essential to check references and background information–our guide on how to buy consulting services can help with that process.
Lastly, remember, in order to get the maximum return from your consulting spend, you need to select the right consult first. At Consulting Quest, we set the ball rolling for you.
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