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3 Future Trends to Transform Your Supply Chain

Posted by Lauren Wilson on 05-Mar-2018 11:30:00

Technology is Evolving - 3 Future Trends to Transform Your Supply Chain

Procurement is an ever-changing landscape of cost-comparisons, resource shortages, and new technologies.

With so many variables, it’s not surprising that there is no single, accepted method for maximising the efficiency of supply chains. What works one day may cease to be so effective the next.

All of this raises the question: How do you achieve true supply chain efficiency?

The answer lies in identifying trends in procurement and ensuring your processes are agile enough to embrace innovation and release out-of-date methods.

As a start, our experts have shared their top three trends in supply chain efficiency, focusing on how you can improve your communication, staff processes, and production and data capture.

  1. Stick Your Head in the Cloud
  2. Train Like No-One is Watching
  3. Don’t Fear the Rise of the Machines

Let’s get started...

1. Stick Your Head in the Cloud

Anyone who has had a teenager in the last 15 years has probably noticed a puzzling contradiction.

Verbal communication skills around the house seem to plummet to nothing more than grunts of recognition (mainly when collecting dinner) and rolled eyes (anytime other than dinner), while they flourish online in contrast.

Social media channels that have grown from MSN and Myspace through to Facebook and Twitter are a hive of activity for the technology-savvy, with messenger applications seemingly adding traditional communication skills to the scrap heap, along with smoke-signals and carrier pigeons.

Sadly though, while we may tut disapprovingly when our offspring disappear to their rooms every evening to talk to 17 of their friends all at once, we are forced to consider a troubling thought:

Maybe they know something we don’t.

Online, cloud-based systems offer a level of communication efficiency that simply can’t be achieved through face-to-face meetings, phone calls, or even emails.

Diving into the cloud lets you take all aspects of your procurement process online, allowing you to source products, make orders, and have them confirmed all in one place.

PO creation, inventory documentation, and vendor transactions are all simplified in a single place, reducing the time your team takes to do their job and allowing you to better react to increased demand.

Many procurement professionals are already benefiting from the cloud, and you may be one of them. What is important to remember is that the cloud is evolving all the time, so it needs constant monitoring to not fall behind.

This is especially important when you consider that by 2019, 86% of workloads will be processed by cloud data centres.

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2. Train Like No-One is Watching

We’ve seen how changing technology is impacting procurement, and it makes sense that in this section, we talk about how you need to invest in the training to keep up.

Actually, that is not the case, with 25% of Chief Procurement Officers survey by Deloitte saying they spent less than 1% of their budget on training in 2017.

Of course, learning to use new technologies is crucial, but that’s not the aspect of training we’re going to explore. Instead of looking at what you need training in, we’re going to consider how you train.

What? Training is training, right?

Well, just as education evolved from copying facts from a chalkboard to interactive group work, new techniques for training staff are beginning to take a new form.

By 2025, 75% of the global workforce will be made up of millennials and, as such, new training techniques are beginning to develop to suit their way of learning.

Procurement professionals who want to get ahead should start implementing these trends to ensure their team are leading experts in their field.

Quick note: these training ideas don’t just apply to procurement. Check if your suppliers are doing the same.

  • Gamification: This training technique is designed to increase engagement. We’ve all sat down in front of training videos and found our minds wandering after a few minutes, but using game theory and mechanics, you can motivate staff to perform and problem-solve better. This training is already highly anticipated, with 80% of learners claiming training would be more productive if it was game-orientated.

  • Microlearning: Training can be hard to squeeze into the working day and, as a workaround, it is often delivered all at once over an afternoon. This is great for time management, but not that good for learning. Microlearning breaks teaching into more manageable sizes. Creating lots of short, content-rich elements allows learners to stay engaged. This better suits busy working weeks that typically only allow for an average of 4.8 minutes a day for training.

  • Virtual and Augmented Reality: VR and AR training are becoming more popular in big businesses, since they are able to provide real-world training scenarios. The procurement industry may not be ready for VR yet, but with technology progressing every day, it’s worth keeping an eye out.

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3. Don’t Fear the Rise of the Machines

The days of manufacturing machines that could be fixed with a swift hit from a spanner are, sadly, behind us.

Now the level of machine-to-machine (M2M) sophistication and communication that is almost the stuff of science fiction. No, we don’t mean a Terminator-style machine rebellion is on the horizon; evolutions in machinery is all good news that should be embraced.

Knowledge is power, and this mantra plays a huge role in a successful procurement strategy. The more you can learn about every aspect of your supply chain, the more opportunity you have to find areas to improve efficiency.

M2M systems monitor all of the automated systems within an organisation, including production equipment. In this way, M2M provides a high level of reliability, but it can also be applied to other aspects of the procurement process.

For example, M2M is becoming more prominent in warehouse management, in some cases managing more than 70% of the order fulfilment process. While doing all this, warehouse management software is gathering data that can be used to identify ways to expedite the process.

By identifying suppliers that are committed to investing in M2M, you can see a side of your supply chain that was hitherto unknown. And, the more suppliers you have using M2M systems, the better the efficiency of your supply chain will be as a whole.

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By ensuring your procurement process incorporates these trends, you can be well on the way to creating an efficient supply chain.

Improving efficiency isn’t the only consideration in procurement though. Reducing costs is the number one priority for 79% procurement professionals, and by downloading our free eBook, The 4 Stages of Procurement Savings, you can do just that.

Download our guide to procurement savings

Tags: Sky Thinking