Supply chain innovation investment set to soar in 2019

Date Posted: 26/04/2019 Category:
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Supply chain innovation investment set to soar in 2019

Date Posted: 26/04/2019 Category:

The three-year-long investment decline in supply chain innovation is about to reverse in 2019, with 95% of respondents to a new survey confirming that they intend to increase spending this year. The survey, Elevating Supply Chain Digital Consciousness, by Deloitte and US supply chain trade body, MHI, polled 1,000 supply chain professionals globally. Two-thirds of the participants were CEOs or other senior decision-makers. The report urges firms to adopt a ‘digital supply chain mindset’ stating: “Businesses that make smart use of supply chain innovation can … position themselves to be the disrupters, rather than the disrupted. But achieving the vision of a digital, always-on supply chain is neither easy nor free.”

Approximately 60% of respondents confirmed that they were planning new tech spending of over US$1m in the coming two years. A third plan investments of over US$5m. The technologies promise greater efficiencies and enhanced cost reduction, with robotics and automation emerging as the innovations most likely to improve competitive advantage, as cited by 64% of respondents, followed by predictive analytics (58%), AI (55%), the Internet of Things (52%) and drones and driverless vehicles (51%).

Cloud computing claims the prize for the most widely adopted technology, as reported by 56% of respondents, although that is expected to surge to 91% in the coming five years. Over the same interval, predictive analytics is expected to hit an adoption rate of 87%, IoT a rate of 80%, robotics, and automation 72%, AI 55% and drones and driverless vehicles 51%.

The report warns that as the pace of adoption of innovative technologies accelerates, “the price of inaction will be severe.” One concern is the degree to which technologies like bots and automation will replace human supply chain jobs, but the evidence seems to suggest that mundane tasks will be performed by machines, freeing human talent to concentrate on more valuable and complex tasks, such as supply relationship management.

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