Supply Chain Management: Top Trends in 2024

Supply chain management (SCM) started out as a seemingly simple administrative task: organize the purchase and delivery of the goods and services needed by the factory. However, the concept has evolved to match the growing complexity of modern business, and it is now regarded as a core part of the operational backbone of every manufacturing organization.

SCM defines strategies and procedures, and supports collaboration across numerous supply chain partners and a wide range of processes including forecasting, sales order processing, production, delivery, supplier relationship management, and procurement.

In simple terms, supply chain management asks the question “How can we improve processes right across the supply network to provide more value to our customers and outperform our competition?”.

Risk & Resilience

In recent years, the vulnerabilities inherent in global supply networks have emerged as major concerns throughout a diverse range of industries. The Baltimore bridge disaster is the most recent example of supply chain vulnerability. Baltimore is the biggest car port in the US, handling around 850,000 vehicles annually, and the potential delays in parts deliveries could pose a risk to the auto industry’s highly time-sensitive supply chains. To stay ahead, companies must constantly monitor their risk-management strategies.

In parallel, companies can harness technology to optimize inventory management and enhance collaboration within the supply chain. By rethinking inventory management companies can pinpoint where in the supply chain they can separate or delay certain production steps, improve the alignment of inventory levels with demand fluctuations, and reduce the risk of excess or inadequate stock. Furthermore, improving collaboration and visibility with suppliers, logistics service providers, and other key stakeholders through technological solutions such as software and IoT-enabled tracking systems facilitates real-time information sharing, enabling proactive risk management and rapid response to disruptions.

Sustainability & ESG

CEO agendas now prominently feature sustainability, with businesses increasingly scrutinizing their environmental footprint, particularly emissions. Previously, the focus was primarily on internal emissions, such as those from factories, and electricity procurement. However, attention has now shifted to the broader perspective – Scope 3 emissions, encompassing the entire supply chain. This transition isn’t merely optional, in many countries it’s becoming a legal requirement.

To optimize transportation routes and reduce greenhouse gas emissions, several measures can be implemented. Consolidating shipments to minimize deliveries and travel distances is paramount, and embracing alternative modes of transport like trains or ships, with typically lower emissions than trucks or planes, can significantly contribute to this optimization. Additionally, technologies such as GPS tracking and routing software can further refine routes and reduce fuel consumption. Yet, to really make a difference in reducing emissions, companies must have a solid understanding of where they stand right now.  Establishing a baseline for emissions and monitoring changes over time is relatively straightforward for internal emissions, but the task becomes markedly more complex when accounting for the entire supply chain.

Tackling Scope 3 emissions requires comprehensive data collection from suppliers. Companies are devising innovative methodologies for emission calculation, often integrating various approaches. Digital platforms are increasingly leveraged to streamline data input from suppliers, facilitating its inclusion in sustainability reports. Transparency within the supply chain is pivotal for promoting sustainable practices and involves implementing systems to trace goods from raw materials to finished products. Also, requiring suppliers to disclose information regarding their sustainability practices, including environmental and social impact, is vital. Regular supplier audits are essential to verify compliance with sustainability standards and promptly address any arising issues.

Digitalization & AI

One key enabler of risk-resilient and sustainable supply chains is digitalization, which promises to revolutionize supply chains by improving efficiency, reducing costs, and increasing agility. Traditionally, supply chains struggled with manual processes and disparate data sources, leading to inefficiencies and errors. However, these challenges are being overcome through the adoption of advanced technologies such as cloud computing, IoT, and blockchain. These technologies allow for seamless data exchange, real-time monitoring, and end-to-end visibility across the supply chain.

One of the most significant benefits of digitalization is the utilization of big data analytics. By harnessing vast amounts of data generated throughout the supply chain, organizations can derive actionable insights into consumer behavior, market trends, and operational performance. This enables more accurate demand forecasting, optimized inventory management, and proactive risk mitigation strategies.

AI is revolutionizing supply chain management. AI-powered algorithms can analyze complex data sets at scale, identifying patterns and anomalies to inform strategic decision-making. However, the effectiveness of AI hinges on the availability and quality of data. Addressing data fragmentation challenges is crucial to unlocking the full potential of AI. To combat data fragmentation, organizations must prioritize data integration initiatives, consolidating information from disparate sources into a centralized system. This not only improves data accessibility but also enhances data accuracy and consistency.

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Taking advantage of the latest market intelligence

The companies best placed to deal with the challenges and maximize the opportunities in these markets are those who are well prepared and take advantage of tactical industry intelligence, updated in real-time by industry experts, that provides the latest information from across the globe. 

As well as identifying the different categories of products and grasping the different business strategies, they must also engage with the main areas of change, growth, and risks in the industry.  

In addition, people responsible for employees’ professional development should use training services that lead to industry certifications and proof of expertise in the industry.

High-performing companies recognize their executives, sales, marketing, and service staff can be more effective when armed with up-to-date information about the challenges their clients face. Cambashi Industry Insights provide tactical industry intelligence from across the world, updated in real-time by industry experts, including:

For more information visit our Industry Training section.

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