Challenges and opportunities - SCM Technology report

Supply Chain Management Technology report

IT Reseller spoke with leading vendors and analysts within the supply chain management arena about some of the current key talking points and areas of innovation within this fascinating and all-important technology landscape.

For a variety of well-documented reasons, supply chains have arguably been put under more pressure and faced more business and operational challenges than ever before over the past year. Take retail, for example. Due to the pandemic, most brick-and-mortar stores have remained closed for much of the past 12 months, encouraging many to focus on venturing into the world of e-commerce for the first time or putting pressure on them to improve their current online regime as well as ensuring product supply for in-store sales remains robust.

Alex MacPherson, director of solution consultancy and account management, Manhattan Associates, makes the point that retailers are unsure of the landscape that they will face when their doors are allowed to re-open. “With the recent fall of certain high street stalwarts, retailers are asking themselves how to innovate their current SCM system to keep up with the huge demand of e-commerce, especially in today's pandemic-centric world,” he says. “The need to have a sleek, cloud-based SCM, making the move to the cloud is now more vital than ever. Retailers are recognising this need and subsequently implementing a cloud-based system into their workflow, promoting business innovation and improving efficiency. Typically, legacy on-premise solutions that organisations are tied down with face time-consuming upgrades in order to get to the newest version of the technology.”

MacPherson adds that as software vendors add new innovations, retailers are restricted from accessing these until they upgrade the system. “Even then, companies will have to wait until the next upgrade – which could be years down the line – in order to introduce the newest developments, meaning many companies miss out on innovation at the times they need it most,” he says. “Cloud applications flip this approach on its head completely, resulting in virtually no discernible downtime for the business, allowing demand to be continually met.” According to MacPherson, another key focus for retailers at the moment is the demand for pre-pandemic delivery offerings like same-day or next-day delivery. “Over the past year, consumers have generally been more understanding of longer delivery windows, so retailers are now evaluating the necessity of these offerings as the pandemic restrictions begin to lift,” he says. “Businesses are concentrating on this requirement from a cost perspective as well as a demand perspective, both of which impacts the SCM and its ability to keep up with the seemingly constant shifts in customer behaviour. In order to keep up with demand, retailers are finding the need to integrate their SCM solutions alongside AI, analytics and (increasingly) robotics and automation technologies to create efficiencies and flexibility within their workforces.”

Shaun Cheyne, principal consultant, consumer products supply chain, Capgemini, and John Formston, supply chain architect, Capgemini, home in on developments taking place particularly within planning and execution that are really driving innovation within the SCM spage. “First, there is a strong desire to implement integrated systems designed to enable better planning and simultaneous execution by connecting multiple systems across supply chain functions into an integrated end-to-end solution,” they say. “With SAP advanced planner and optimiser reaching the end of its supported life, more advanced digital capabilities and the need for more agile short cycle planning most organisations are on the lookout for alternative systems.

Because of this opening, many new technologies are emerging, centred around being more end to end and responsive and less focused on regular cost optimisation.” Cheyne and Formston add that organisations are looking for greater richness in what can be planned and evaluated. “For example, volume plans in SAP IBP can be readily integrated with Analytics Cloud, facilitating deep and wide-ranging financial value analysis,” they say. Another key innovation within the sector, according to Cheyne and Formston, would be the increased levels of automation to support in generating planning data, reports and analysis to support S&OP processes. “Many businesses are moving to more online management of planning processes such as S&OP supported by system orchestration capabilities and automated check points,” they say.

Alan Salton, director of innovation, Panorama Consulting, cites Internet of Things (IoT) sensors. “These sensors don’t just tell us where shipments or containers are but enable the monitoring of data that could impact a shipment’s overall condition, such as fluctuations in temperature and humidity, and other situations such as excessive pressure, light, and shock that could impact quality,” he explains. “This has become apparent as COVID-19 shipments are being monitored for temperature control and maintenance.” Salton also points to supply chain analytics – moving from descriptive analytics (what has happened presented in reports) to predictive analytics (what will happen based on the data) to prescriptive analytics (offering recommendations and strategies based on the data to improve performance). “Analytics will focus on carrier management, forecasting, predictive maintenance, identifying inefficiencies, warehouse optimisation strategies, etc,” says Salton, who also references mobile solutions using cognitive technologies that mimic human interaction and decision making in processes such as cycle counting, shipping and receiving, picking, transportation management and field service.

Additionally, Salton points out that the implementation of robotic process automation to capture and interpret applications for processing transactions, manipulating data, triggering responses, and communicating with other digital systems is also a current key area of development – applied to processes such as reconciliation, invoice matching and payment and AR/AP workflow. Other current areas of development, highlighted by Salton, include the application of AI and machine learning to these technologies to move towards self-maintaining supply chains.

Gopal R, global leader, supply chain & logistics practice, Frost & Sullivan, comments that human errors in operations, underutilised assets, low workforce productivity, inefficient operational planning, inability to match supply with demand, and trimmed profit margins are key prevailing concerns with freight operators. “The emergence of digital technologies and the rapid technological advancements in digitisation have transformed the business and operational landscape of the global freight transportation industry,” he says. “Real-time supply chain visibility has become a reality for shippers and logistics service providers by leveraging technologies such as big data analytics, cloud computing platforms, and artificial intelligence.” Gopal adds that emerging digital technologies assist warehouse operators in redesigning their value chain strategies. “Growth of cloud-based products and enterprise software solutions has enabled warehouse operators to achieve better control over the inventory and pilot with an on-demand service model for customers to meet seasonal demand,” he says. Additionally, Gopal believes supply chain digitalisation, last mile innovations, warehouse automation, digital platforms and new-age business models are some of the areas transforming global supply chain ecosystem.

Changing consumer demands

David Krebs, executive vice president, enterprise mobility & the connected worker, VDC Research, considers that automation and robotics continue to be key themes for SCM that have become only more amplified over the past 12 months with the step-change towards e-commerce. “That said, labour remains critical for supply chain operations with most warehouses and DCs relying on manual processes to support operations,” he adds. “However, supply chain organisations are struggling to meet changing consumer demands (which shifted into overdrive this past year) and effectively address labour demands (availability, onboarding, etc.) With the need to scale and grow operations, a more comprehensive and coordinated approach towards automation and robotics is required.” With regard to key drivers behind these trends Krebs believes this is mostly a function of changing expectations and shopping habits (expectations largely borne from e-commerce giants). “Not to over generalise, but consumers are looking for large selections (SKU counts), price shop aggressively and believe that shipping should be free and immediate,” he says “Given these conditions, the pressures place on supply chain operations and the systems in place to support are only growing. Real-time visibility into your operations – people and inventory – is what will set businesses apart.”

Philip Jarrett, commercial director at Dakota Integrated Solutions, considers that, along with the growth in automatic data capture devices and RFID in general, Voice-directed solutions have become increasingly embraced as highly effective in the Warehouse and DC environment for speedy and accurate item picking and replenishment. However, he makes the point that this type of technology is now also gaining a foothold within industrial sectors for the purpose of maintenance & inspection (M&I) of machinery and equipment. “Based on my own experience in this technology space over the past few years, I am convinced that Voice within the M&I arena is the future from the perspective of substantially improving time and cost savings as well as increasing accuracy levels when maintaining, inspecting and repairing machinery – whether it’s an aircraft engine or a complete delivery truck,” says Jarrett. “Voice M&I can ensure the operator adheres to the most optimum sequence of inspection.” Jarrett adds that, in Dakota’s case, the company can not only supply a fully configured Voice solution but also provide the full RF network to customers in order for the Voice system to work efficiently through uninterrupted shifts.

In terms of key drivers for these types of changes, Jarret says more and more companies are recognising that in order for them to gain a strong competitive edge through faster speed of operation and greater levels of accuracy the right type of state-of-the-art technology needs to be embraced and deployed. “In the case of picking and replenishment in the warehouse, Voice-directed solutions such as Honeywell’s Vocollect Voice are a no-brainer in terms of what they can offer, together with a fast ROI based on the high levels of time and accuracy improvements that can be easily and quickly achieved,” he says. “The same goes for the M&I market space. Using what we refer to as an optimal walk sequence, Voice can optimise each step within, say, a truck inspection process. The Voice solution can be configured to ensure each step is done in a the quickest and most efficient sequence for a particular customer’s specific requirements.”

Katie Tamblin, chief product officer, Achilles, explains that a 2020 Achilles survey found there were a number of key areas in which procurement and supply chain professionals are addressing risk in 2020-2021 (see graph). In terms of what has driven these developments, Tamblin comments that most of the focus on that cited in the graph has come from disruptions caused by Brexit, the COVID pandemic or other bottlenecks in supply chains. “They have highlighted that global complex supply chains can be opaque and therefore difficult to manage when logistics or movement is restricted,” she says.

Trend acceleration

Mohit Paul, chief revenue officer, Extenda Retail, comments that the COVID-19 pandemic has irreversibly accelerated a number of emerging trends in retail. “The shift from brick-and-mortar stores to digital shopping channels had gradually gathered momentum up until when the effects of the pandemic were first felt, after which it has become a necessary way of life in a number of economies,” he says. “But will there be a clear dividing line between one and the other? We don’t believe so. Our view is that the technology that sits in the hand of the consumer – the mobile phone – will become the ‘glue’ between traditional brick-and-mortar and digital channels. The ability to shop at home and collect in store, shop in store and have your items delivered to your home, use an app on your smartphone to generate a shopping list based on personal preferences, history, sustainability and causal factors – all of these functionalities, and many more, will become commonplace in 2021 and beyond.”

Moreover, in conjunction with this change in how demand is placed, Paul maintains that the supply chain must come up with suitable strategies for order and demand fulfilment. “In addition to the vast warehouses that have been built over the past 15 years to satisfy the emergence of digital shopping, micro-fulfilment centres that allow the physical supply chain to flex with demand will also, in our opinion, be one of the key trends in the next 2-3 years,” he says. “In order to reduce cost-to-serve, retailers and logistics providers must find ways to get smart about how assets are utilised in order to deliver ever increasing expectations on availability and service.” Paul adds that with the increase in e-commerce, 3PLs are gaining more and more momentum. “This is truly their time to shine,” he says. “Our statistics show that 3PLs are constantly getting new customers, and the reason is the explosion in online shopping habits. As retailers are experiencing a surge in delivery demand from the end consumers – both across the B2B and B2C sectors – many don’t have the ability to manage their warehouses as efficiently as they would have wished. Consequently, 3PLs are winning new ground, as they specialise in supply chain optimisation, warehouse management and fulfilment.”

Additionally, Paul comments that the increase in demand has created a need for more advanced analytics and forecasting, not only in relation to stock and items, but also in terms of staff planning management. “There are new developments which are increasingly important across the supply chain, and these are centred around enabling retailers and 3PLs to proactively and efficiently forecast their staffing, based on season, day or time of day,” he says. “Supply chain management is no longer divided between the B2B and B2C sectors – these worlds are merging, similarly to the digital and physical retail sphere. There is a rising demand for innovative solutions that enable 3PLs to manage both B2B and B2B clients in the same system, and also allow for bulk shipment and single-item shipment, which makes the supply chain management far more efficient. Retailers with their own warehouses are focusing their attention on automation in order to streamline processes. If retailers have the logistics internally, many are talking about ways in which automation can improve the supply chain and fulfilment cycle.”

One of Extenda Retail’s retailer customers which uses the NYCE.LOGIC WMS has implemented automation functionality for its packaging, where the picking staff gathers the items, places them on a conveyor belt where a packaging robot receives the items and packs them, marking them with postage labelling. “This makes the packing process extremely efficient, as the staff manages the picking and selects products to ensure quantity and type is correct, whereas the packing robot manages the more time-consuming packaging process,” explains Paul. Last but not least, Paul cites environmental awareness in supply chain management as something that is increasingly important. “Many large retailers are moving away from free returns to spare the environment, with the reasoning that it’s no longer sustainable from an environmental point of view,” he says. “Furthermore, packaging materials in addition to in-warehouse processes and materials used are constantly being reviewed to decrease environmental impact as much as possible.”

With regard to key drivers for these changes, Paul believes it all boils down to the end customer requirements – regardless of if that customer is an individual or a business. “Customer demands are changing fast, and it is vital for both retailers, 3PLs and logistics providers to merge the physical and digital spheres,” he says. “Today, most of us expect flexible shopping options (in-store or online) in addition to flexible delivery, pick-up and return options. Subsequently, the SCM industry needs to adapt to the fast-moving, informed customer with a proactive and pre-emptive approach. It’s all about providing solutions to a problem that the customer wasn’t aware they had – before they think of it as a problem. One example is the change to the physical, in-store shopping environment with a focus on safety. Touchless payments, physical distancing and shields, and controlling footfall can all be highlighted as key changes caused by the pandemic. Technologies such as Scan & Go using a smartphone to shop and checkout, in-store positioning to allow shoppers to use their phones to navigate the aisles in real-time, and unmanned stores to minimise physical contact. Furthermore, self-checkout solutions are becoming vital to physical retailers, as they minimise interaction between staff and customers, and in extension help safeguard communities.”

Platform model

Bryan Ball, vice president and group director, Aberdeen Group, observes that the platform-to-platform approach is becoming increasingly popular. He explains that through this approach companies can enjoy the benefits of built-in integration. “Ideally, to make supply chain planning effective companies need to have transportation integrated with demand planning, manufacturing, inventory, purchasing and customer fulfilment collaboration and so on,” he says, adding that if all these processes are more connected through a platform, users are not going through integration stacks but rather benefiting from more seamless integration. Ball explains that they can also benefit from a common data model, which can help the whole process to work faster. Within supply chain, Ball makes the point that machine learning is also becoming more prevalent. “For example, machine learning can show planners the top five things they did the last time they ran into a missed customer promise date, an over-sell where they had to scramble for more inventory or where a supplier wasn't able to deliver,” he says.

“Based on these first five scenarios machine learning can provide recommendations such as trying an alternative supplier or dipping into safety stock, and it can also point out what the predicted outcome would be if a particular option is chosen – for example, effects on other customers, on cost and so on. And with the platform approach, rather than having to leave the application to make phone calls or send emails, screen messages can be sent directly to suppliers or customers, which they in turn can respond to and action within the specified timeframe. It was only a few years ago that you had to jump out of the solution and look at purchasing or transportation to find out where the deliveries were; now you can do that in minutes and be much more productive. I think the ability to do that really gives people more visibility of what’s going on in the organisation and provides them with the means to react quicker and more efficiently through having one version of the truth when it comes to their supply chain processes.”

Ball adds that within the solutions themselves he is seeing more use of artificial intelligence. “I attended one online conference recently where a retailer explained it had around 60 people managing transportation networks within regions, but because of the sheer volume of tasks they had to get through within a day they didn't know what to prioritise. They had to check this and that and they had to decide on what should be done first. What they needed was a solution that could make these types of decisions very quickly – pretty much in real-time – by accessing the data, running it through the relevant algorithms, using some robotic process automation (RPA) so the system could make maybe 90% of the decisions, highlight the exceptions using AI and so on. When this type of system was implemented the company was able to cut staff by around half because many of the processes were now automated.”

Denis Niezgoda, vice president – Europe, Locus Robotics, comments that since the early onset of the pandemic last year, companies previously shifting toward a digital warehouse strategy over the medium term are now rushing toward it. “The pandemic caused a dramatic shift in online behaviours, changing not only the way retail consumers shop, but more significantly, the operations of the B2B industrial segment,” he says. “While labour has been a major concern in the past, the pandemic has exacerbated it. As order volumes continue to increase exponentially, lockdowns and social distancing requirements for health and safety have had a direct impact on worker recruitment and retention. The only viable way to cost-effectively mitigate this problem is through automation and we are seeing a notable increase in the number of companies looking into adding robotics and automation solutions to their fulfilment operations.” Niezgoda makes the point that real-time data is helping managers gain a rich, 360-degree view of their operations, helping them to identify opportunities for optimisation, planning and growth. “The Locus solution orchestrates intelligent robot and labour direction, as well as providing full visibility of operational performance data to facilitate forecasting, labour planning and real-time workflow optimisation,” he says.

Regarding drivers for these types of changes and developments, Niezgoda reflects that the pandemic made 2020 ‘The Year of the Supply Chain’ with the dramatic shift to online ordering for both consumer and B2B transforming the way the fulfilment industry operates. “The shift to online ordering has created critical issues in the fulfilment warehouse around cost-containment, labour availability, scalability, growth forecasting and planning, and meeting customers’ service expectations,” he says. “Prior to the pandemic, online growth patterns had been far easier to predict. Operators recognised there would be peak periods and planned accordingly. Many were considering introducing automated solutions into their warehouses to help improve efficiency over the coming five years. However, the demands imposed upon their operations due to Brexit and the pandemic prompted them to shrink the five-year window to now. We have found that companies around the world are aggressively evaluating all aspects of their supply chain to ensure their viability and robustness. Frankly, if operators are not implementing robotic automation now, they risk falling further behind.”

Integration

Have ways of best integrating SCM with other systems developed to any notable degree over the past year or two? Krebs points out that there are many different interface options. “For mobile solutions, terminal emulation remains common even though the technology was never originally intended for mobile solutions,” he says. “However, its performance/response times have made it a popular solution. With the shift from Windows to Android on mobile devices, we have also seen organisations rethink their mobile architectures, looking to take advantage of some of the features and capabilities available on modern devices. In addition, the shift to cloud-based architectures for many enterprise applications (WMS, WES, TMS, etc.) is also a factor. On the mobile side today, we are seeing hybrid native solutions emerge and become more popular. Salton reflects that the move to the cloud has significantly changed the integrations of SCM technologies through the standardisation around web APIs. “The advancement of integration platforms like MuleSoft, Boomi, Tibco and Informatica has made integration of systems easier and more consistent,” he says. “The emergence of marketplace for connectors, templates, examples and APIs are allowing for the use of pre-built assets from several ecosystems which save, share, and reuse internal best practices.”

Gopal comments that wearable solutions in warehouse and fulfilment centres, video telematics in freight transportation, digital freight platforms, Block Chain in port operations, robotic applications in fully automated warehouse and last mile delivery operations, IOT in cargo monitoring and supply chain visibility have all developed extremely well to play a key role in advancing SCM functions. Niezgoda explains that Locus has partnered with the world’s leading SCM companies to develop software integration tools that allow for a rapid and seamless integration of the Locus solution into the warehouse data ecosystem. “This not only gives managers more control over their operations, but also speeds up the deployment process and shortens the time to return on investment (ROI),” he explains.

Paul considers that while more traditional, API-based integrations continue to lead the way, the blurring boundaries between physical and digital commerce has impacted the way that technology interacts. “For example, the ability to select, scan and pay for a product in a store on a consumer smartphone means that traditionally integrated components are pushed into the Cloud and integrated there also,” he says. “Additionally, the way in-store and warehouse staff interact with devices, equipment and its technology is changing. Augmented reality solutions are increasingly popular with retailers and logistics businesses. Today, voice integration, in-device technology, smart glasses, head mounted displays and other spatial augmented reality systems and equipment have entered the entire supply chain, from in-store to in-warehouse. Needless to say, these introductions have developed significantly over the past few years and will continue to drive change at a fast pace.” Paul adds that as we are seeing an increased demand for seamless omni-processes across the supply chain, seamless integration and automation in SCM is becoming essential. “In extension, many of Extenda Retail’s customers are looking for a generic solution which enables automation,” he says. “As an answer to this, our WMS experts have built a generic automation engine. This engine sits outside of the core NYCE.LOGIC WMS, to enable faster integration with both automation systems and equipment.”

MacPherson comments that the level of functionality has notably increased within today's state of the art SCM systems with new features always being required. “One development across various technologies is the increasing importance of developing cloud-based SCM applications that integrate effectively with other applications through enterprise application technology (EAI) systems, be it on-premise or in the cloud,” he says. “For instance, five or ten years ago, retailers would have relied on point-to-point integration and created a software tool that enabled multiple systems to be integrated together. EAI and APIs have made integrations more effective, and this level of functionality has notably increased within today's state of the art SCM systems. Furthermore, moving to the cloud has enabled retailers to benefit from increased flexibility and productivity, which has taken away the usual headache of integrating a new system within a workflow. This common approach to use APIs across the industry for technology integrations has also made systems and upgrades far more straightforward, configurable and efficient.”

Jarrett explains that most data capture devices such as handheld barcode scanners in the warehouse, healthcare and manufacturing environment are now easily configured and integrated with most proprietary best-of-breed back-office systems such as WMS and ERP. He adds that this is now also the case with Voice-directed solutions. He adds that information from business systems, whether on premise or cloud-based, can now be accessed from just about anywhere by running a browser on a mobile device that is integrated to a back-office system. And with the flexibility of the Android operating system that can even be used on old legacy systems, the flexibility regarding integration has never been easier or more convenient.

Tamblin explains that Achilles works most closely with infrastructure and heavy industry, and in these spaces these teams spent 2020 getting to grips with the basics of changing work patterns, data harmonisation and pragmatic supply chain management in the wake of unprecedented disruption. “Integration has come a great deal further in individual, consumer-based procurement than in B2B procurement,” she says. “At home, individuals can use voice and mobile to order whatever they want from Amazon, Ocado, etc., but the B2B procurement teams we support aren’t seeing any benefit like this. ERP systems have demonstrated some great enhancements at events and online, but the reality for many users is that the uptake has been slow and the application of it by B2B players in their workflows remains limited.”

Cloud/SaaS

How has the Software as a Service (SaaS) model – and the cloud concept in general – impacted the SCM software solutions market? MacPherson says it is no secret that increasing numbers of supply chains are moving to the cloud, but, as a result, many retailers are facing the challenge of integrating their cloud technology with their current SCM. “Warehouse Management Systems (WMS) are installed in many warehouses and with intelligent cloud or SaaS solutions in place, new software functionalities will usually be updated every quarter, allowing retailers access no capability immediately without waiting for upgrades,” comments MacPherson. “The way these systems’ function has changed quite considerably thanks to SaaS. For example, retailers have the luxury of testing the technology before it is put into play and set to live in the warehouse. The software has the capability of working within a ‘staging environment’ for two weeks so that customers can run as many tests as they wish before officially ‘switching’ on that updated solution to go live in the warehouse. In addition, the move to a smart SaaS solution has enabled many IT departments to become increasingly customer centric which allows them to focus on other aspects of the SCM within the company, increasing efficiency and productivity within other departments of the business as a result.”

Niezgoda comments that Locus Robotics’ Robots-as-a-Service (RaaS) model allows warehouses to add autonomous mobile robot (AMR) automation to their existing operation at a reasonable cost while delivering a ROI in weeks, rather than years. “RaaS lowers the upfront costs by reallocating a single capital expense into recurring operational expenses, allowing companies to easily deploy a cost-effective state-of-the-art automation solution,” he says. “The RaaS model gives operators the flexibility they need to meet changing demands, unlike capital expense models. When volumes grow due to seasonality or sudden demand spikes, operators can simply add more bots to absorb the increased volume and then send them back when volume levels return to normal – without requiring extensive reconfiguration or complicated set-up.”

Paul believes that, as with other industries, SCM benefits from software being delivered as a service. “Technology deployments that would previously require significant investments in hardware have often become redundant when the same capabilities can be accessed as a service,” he says. “And as consumer demands and expectations are higher across an increased number of demand and fulfilment channels, the ability to meet this demand on-time and in full has never been more important. The ability of a SaaS model to scale seamlessly, the shorter implementation times and the faster time-to-market offer superior benefits for companies and an enhanced experience for consumers. Due to these advantages, the demand for SaaS models is increasing, as businesses want to buy logistics as a service. The SaaS model is gaining momentum thanks to its flexibility in terms of scaling and systems development. It offers agility in terms of adapting to varying transactions, or varying number of staff members active within the supply chain.”

Salton makes the point that SaaS has made sophisticated solutions available to a broader audience, reducing costs, lowering maintenance and support requirements and lowering technical debt and TCO. He adds that the cloud has had remarkable impact on SCM including:

• Access to everything as a service (AI, analytics, content, BI etc.)
• Short-term cost savings – Pay as you go.
• Security – Full-time monitoring, encryption and administration
• Flexibility – Scalability in bandwidth, storage and computing capability
• Mobility – All mobile devices need internet access.
• Increased Collaboration – View and share information in real time.
• Quality control – standardise and maintain revisions.
• Disaster recovery
• Automatic software updates
• Sustainability

Mobility solutions

Are mobility solutions such as mobile computers and tablet PCs etc. having an impact or influence on SCM? “Yes and no,” says Tamblin. “Certainly, end users have greater access to enter data directly via mobile devices on site, which is useful. However, the greater limiting factor is often the lack of integration across SCM systems in the back end. For example, inventory management systems don’t talk to EH&S solutions, or the ERP doesn’t talk to the compliance system. More broadly, it could be the case that the procurement team in Region 1 isn’t using the same systems as the procurement team in Region 2, so while Region 1 has mobile apps and is really sophisticated, none of this is informing a global procurement strategy as it doesn’t sync up with the data or systems that are used elsewhere.”

Niezgoda stresses that easy access to information is critical to optimising warehouse efficiency. “Locus provides a rich suite of actionable data that empowers managers and workers with a real-time visualisation of their operation – from anywhere in the world,” he says. “Locus’s dashboards and reports are easily accessible through a tablet, computer – or even a mobile phone, enabling operators at all levels to have real-time access to key metrics any time they need it so they can efficiently manage their business.”

Paul considers that mobility and augmented reality (AR) solutions have a huge impact on SCM. “Accessible tech and mobile devices are impacting the SCM vastly,” he says. “Tablets and mobile devices are vital to SCM, but what we’re also seeing a surge in demand for interactive accessories, such as smart glasses or other AR equipment, enabling in-warehouse staff to use both hands – and increase efficiency when scanning and picking items. Last but not least, web-based SCM solutions that enable real-time updates across all equipment and devices are becoming vital. From a data and integration perspective it’s definitely the way forward, as all users within our outside ‘the four walls’ regardless of device access the same integrations, information, functions. In extension, data provision is not impacted as they will get the same information across the board – in real time.” Krebs comments that as long as labour is fundamental to supply chain operations – both inside the warehouse/DC and beyond the four walls – mobility solutions will be critical. “Be it a rugged handheld computer (RF scan gun), wrist-worn computer, wearable speech solution, or a tablet for improved data visualisation, these solutions are having an immediate impact on overall productivity and in reducing errors in workflows like picking, put-away, receiving, delivery, etc,” he says.

The impact of Big Data and Blockchain

How are concepts such as Blockchain and Big Data having an impact on the world of SCM solutions? Paul considers that the number of events that create data points, the origin of such data and the services that consume the data have rapidly increased. “The result is that the enterprise is more complex, more active and contains more value for those companies that are able to exploit data associated with operations,” he says. “Additionally, the multi-tenancy associated with true SaaS platforms that are built in the cloud means that where data is aggregated and/or anonymised, users of such technologies can benchmark themselves against market indices.

Extenda Retail’s WMS Solution NYCE.LOGIC works on a sophisticated level to harness the power of Big Data and enable our customers. One example of this is our Workforce Planning module, where our system automatically tracks and analyses all data available over time on staff and their respective tasks, time management during a workday. Subsequently, the system proactively forecasts the number of staff members required by season, time, or time of day. Last but not least, the system proactively suggests how to plan and structure the supply chain staff.” On the other hand, Paul believes Blockchain has yet to make any significant impact in consumer-based industries such as retail, or high intensity logistics. “Traditional payment technologies associated with consumer retail and banking have proven themselves over tens of years and the business case to replace them will take more time to establish itself,” he says. Paul believes the main drivers for Big Data developments are increasing amount of information, the pressure on optimising the supply chain and the importance of streamlining processes to become more cost efficient. “In extension, the Big Data developments in SCM will enable a more efficient process within each organisation, and a higher level of customer service and satisfaction,” he says.

Andrew Stevens, senior director analyst, Gartner, reflects that there has been much hype across recent years as the value of Blockchain and the role played by Big Data. “The recent shift that we have observed across recent years is that many organisations are adopting a more much more holistic and strategic view of the value of technology trends as they apply them to their specific business objectives in conjunction with a fresh evaluation of the concept of the end -to- end supply chain,” he says. “There is also much more of a focus on understanding the timing and positioning of technologies in conjunction with reviews of process and operational best practices such as supply chain and digital maturity, risk and gap analysis and a drive of increased levels of digitalisation across all stakeholder involved in the full life cycles of products and assets.

We are also observing a broader evaluation of existing and legacy data which may have aggregated across enterprise and shared value systems (such as in manufacturing and logistics) and applying technology tools such as machine learning and analytics to cleanse the data and being be able to position data at the right place at the right time and in front of the right stakeholders that can translate into actionable business decisions. A focus on ensuring high quality and real time data is becoming very important as part of planning for technology investments and in promoting foundations of visibility and digitalisation to better identify the best use case and opportunities in which to trial innovative technology solutions. One final element is the increasing importance of assessing the value of combinations of technologies solutions working in synchronisation with each other (such as hardware and sensors in IoT solutions) and well as focus on augmented and embedded tools and capabilities such as artificial intelligence and analytics that can process, verify and authenticate data in the background and help organisations transition towards more automated and predictive levels of operations.”

Stevens adds that the main drivers and themes that often drive discussion in this area include:

• Breaking down of functional silos to enhance more unified communications and visibility across the extended supply chain
• Security and governance at scale across the supply chain
• The need to embed greater levels of resiliency and agility across the end-to-end supply chain
• Data silos and data lakes as a result of legacy applications or bespoke systems
• Anti-counterfeiting, fake products and digital/cybersecurity
• Urgency for transparency and traceability derived from objectives supporting environmental social governance and sustainability 

Ball considers that Blockchain can be challenging in certain situations; for example, where negotiation needs to take place or where disputes occur. If two parties agree on the price of items, this information is put in the system and there's no dispute – the money comes out of one account and goes into another account. It’s a clean process. But if you consider change notices, say within the context of something made to order where add-ons are requested, or chemicals whereby it can be difficult to deliver precisely the same weight as specified in the contact, which could result in some sort of dispute. “Scenarios such as this can complicate the order,” says Ball. “This is very different from the regular stock keeping unit (SKU) model.” Ball adds that if a product is run as a promotion and the normal price doesn't apply, separate promotion codes are required. But when these products are delivered the paperwork might not have been updated to differentiate them from regular stock – this again can make things more complex and may not suit the Blockchain model as well.

Cheyne and Formston observe that Big Data is having a huge impact on SCM solutions and is being utilised more effectively by organisations to improve efficiency and provide teams with the correct knowledge to make more informed decisions. “Data lakes are making data more readily available for supply chain systems to ingest and for users to make better decisions,” they say. “It has also facilitated new solutions in ‘near-term’ planning such ‘demand sensing’, which utilise large data volumes.” Cheyne and Formston add that Blockchain is providing guaranteed end-to-end traceability for materials within certain industries, be it ‘farm to fork’ for food or raw materials in the pharmaceutical industry. They comment that it is also being implemented to help reduce the need for quality and inspection checks throughout the supply chain by guaranteeing data transfer. Cheyne and Formston believe the key drivers for the developments of Blockchain and Big Data are traceability and visibility. “This is helping to improve coordination and drive efficiencies throughout the supply chain,” they say. “Blockchain enables this without the need for sharing sensitive information.”

Gopal points out that some of the applications of Blockchain in logistics and supply chain includes customs clearance and port operations, smart contracts service management and digital provenance solution (shipping lines), documentation services, financing and claims management (logistics services), claims management, documents management, security and insurance (fleet management), documents and payment management (e-commerce logistics). In terms of the drivers for implementation, Gopal adds that an efficient logistics network, end-to-end supply chain visibility, access to real-time and accurate information among the players in the ecosystem are some of the key features of efficient supply chain system. “Blockchain technology is expected to overcome issues with the current generation’s technology scalability by facilitating a digital ecosystem for data interoperability,” he says. “Blockchain technology provides an optimum platform for documentation and transaction, benefiting the players in the ecosystem. Big Data, on the other hand, is critical for all forms of business analytics as well as predictive solutions for the SCM landscape.” According to Gopal, the main drivers for Big Data are: the need for visibility, foresight and the need for predictive analytics, while for Blockchain it is secure and faster transactions.

Enhanced item-level transparency

Krebs observes that Blockchain technology is creating tremendous buzz in the supply chain as an immutable ledger or database that manufacturers/producers and their partners can rely on to help with cradle-to-grave track-and-trace, recalls and anti-counterfeit measures. “Our survey participants highlighted what they would expect to be the key benefits of Blockchain-related investments for their organisations – improved data integrity due to inability to change records once entered; enhanced item-level transparency and auditability; and insights into partner inventories, thereby enhancing order management,” he says. “Some 39% believe Blockchain technology will help provide real-time visibility to enable quick responses to issues like product recalls.

Salton explains that Panorama Consulting has seen an implementation a Blockchain chain to lock down maintenance records along the supply chain and develop predictive maintenance. “Blockchain solutions have been implemented to cut down the time associated with paperwork, which often has impact on the shrinkage of perishable goods,” he says, adding that a decentralised database (Blockchain technology) is being used to supply chain partners in licence agreements, rebates and commissions. Salton also considers that Blockchain-backed logistics is at the forefront of intercompany cooperation, using it to keep a digital ledger of shipments and maintain integrity of transactions. With regard to Big Data, Salton explains that this creates new data sources to improve planning processes and their demand-sensing capabilities. “Throughout the supply chain point of sale (POS) data, inventory data, and production volumes can be analysed in real time to identify mismatches between supply and demand,” he says.

Tamblin explains that from Achilles’ perspective, the uptake of these solutions across supply chain teams is low. “There are some interesting pilots going on, with some compelling early successes in specific areas, but they remain niche and difficult to expand at scale,” she says. “Big Data and Blockchain remain buzzwords that lots of organisations use, especially at procurement and supply chain events, but without any clear strategy as to how best leverage or apply those concepts across multiple problem statements. Take Blockchain, for example: having a ledger is really useful in the case of avoiding fraud, but fraud isn’t the biggest problem facing industrial supply chains today. Before detecting fraud, supply chain teams need to drive visibility – they need to know who to ask to contribute to the ledger before they can focus on maintaining its integrity. You could argue that blockchain might help drive that visibility, but, in our experience, these projects are difficult to get off the ground if the end purchaser still doesn’t know who the upstream players are, or what the upstream materials are.” In terms of drivers for change, Tamblin cites the appeal of early adopter status.

The near future

What might be the next key developments to expect in the world of SCM software over the next year or two? Jarrett again cites Voice within the M&I arena as something that is going to enjoy greater recognition and prominence within the market. Salton cites the following:

• Expansion of IoT
• Capital technologies (robots, conveyor systems, drones, RFID)
• Advancement of 3PLs to 4PLs (to include supply chain management), 5PLs to include in-house manufacturing or 6PLs where AI is incorporated into the management of the SC
• Customising the supply chain by customer audience
• Blockchain
• Green and climate-smart SCM
• Circular supply chain
• Application of AI and robotic process automation (RPA)

Stevens points to a few key themes that are seeing momentum. These include:

• Hyperautotmation – transitioning from reactive to more automated levels of decision making
• 5G data communications networks and new generation WiFi services for enterprises
• Clusters, combinations and sequences of technology applications incorporated in formalised roadmaps
• Chain of identity – Combinations of technologies to deliver multi-layered authentication/verification methods and execution at scale
• Industry 4.0 within manufacturing operations and extensions of shared data to the edges of enterprises and beyond -- beginning the scale across the end-to-end supply chain
• Value chain concepts and planning such as Farm- to -Fork models in food and beverages  

Cheyne and Formston believe the next big push will be for greater integration between functional systems and further migration to cloud. “We are already seeing this drive internally and expect it to become a priority for most supply chain teams moving forward,” they say. “We also expect that there will an increase in development of ‘digital twins’ for the supply chain as it is gaining more attention in the industry due to improvements in technical and computational capabilities with operations technology. Finally, we expect that there will be greater demand for AI-enabled touchless planning to reduce the amount of data-intensive manual work that’s slow, costly and imprecise.”

Tamblin points to supply chain mapping driving visibility of Tier 2/3/4 visibility and beyond. “As supply chain teams respond to ever changing legislation requirements, they hold supply chains to account,” she says. “Knowing who is in the supply chain, or who could be, should be the primary focus of mature teams looking to drive continuous improvement. For example, BA was recently held to account for the failure of a supplier to protect its network. The wording in the ICO penalty notice (recently issued) makes recommendations in respect of mitigating risks in supply chains, including:

• Risk scoring contracts to link in with existing risk assessments
• Due diligence, accreditation, assurance of existing suppliers and the adoption, through contracts, of proportionate and appropriate measures designed to mitigate risk
• Audit arrangements and compliance monitoring
• Comprehensive mapping of all tiers of upstream and downstream supply chains to the level of individual contracts
• Contract exit arrangements 

“This is where Achilles believes supply chain teams should be focused, in order to avoid large scale fines associated with network integrity, conflict minerals, modern slavery, etc.”

Scalability

MacPherson comments that cloud technology provides the opportunity for retailers to grow and scale their operations and workflows on demand, coping and managing peak seasons or during a crisis, such as we’ve witnessed this last year. “This scalability will continue to be relied upon and in addition to this, we expect to see increased personalisation introduced into many WMS projects as part of efforts to support and excel in the customer experience stakes,” he says. “For example: if it is the customer’s birthday and they have placed an order within a seven-day window, then the system could notify the picker, enabling the business to write a personalised note or include a discount code. As our reliance on e-commerce grows, especially as a result of the pandemic, making the customer experience seamless and retaining customers is now more important than ever. Having an agile SCM that enables the warehouse to become involved with the customer’s journey and the buying process, will be high on the priority list for retailers over the coming years.”

Paul believes we will see more integrations with automation and AR equipment, as new innovations and companies are on the rise. He also anticipates that Big Data and Machine Learning will see more concrete use in software moving forward. “What is also interesting to point out is the ‘soft’ side of software innovation - having a close partnership between customers and suppliers that will help both reinforce the customers’ missions and where SCM vendors and their customers co-develop initiatives and innovations,” continues Paul. “Additionally, the SaaS model, cloud & forecasting solutions are on the rise. The demand for clever ways of using Big Data to improve SCM is only going to grow, as businesses require new ways of forecasting and improving processes.” Gopal considers that SCM solutions are still very fragmented, so he believes the real development will be a complete suite of solutions in a simplified manner, with ability for full functionality through mobile devices.

Ball believes the platform-to-platform model will become increasingly prevalent within the SCM space. He also foresees more development and uptake of machine learning and AI. Niezgoda considers that as more emphasis is put on digitisation of the warehouse, operators will be looking for more integration and data-sharing across platforms. “Locus is working closely with our SCM software providers to continually expand, evolve and optimise reporting tools and resources that help ensure seamless and faster integrations,” he says. “These tools are designed to provide channel – and partner-specific – metrics for actionable insight into the fulfilment operation.”