I am not typically one to try to predict the outcome of anything. Maybe it has something to do with my risk-averse nature or the fear of being wrong. Whatever the reason, it is safe to say I will not be making any mind-blowing supply chain predictions for the year 2015.
The good news is, if you are a fan of predictions, there are enough to go around for all the major business processes across the supply chain, including procurement, manufacturing and logistics:
- “Suppliers will be trusted partners” (Mickey North Riza on Supply Chain Digital)
- “Within five years social media literacy will be the single greatest factor distinguishing top performing procurement leaders from the rest.” (Lisa Malone on Fronetics Blog)
- In manufacturing, “continued revitalization of U.S. manufacturing, the adoption of new game-changing technologies and increased hiring” is predicted (Ginger Christ & Travis Hessman on IndustryWeek)
- “Competitive threats, for both 3PLs and their customers will cause them to transform the way they work together – they will take a more vested approach” (Adrian Gonzalez on Talking Logistics)
Based on these predictions, 2015 should shape up to be quite an exciting year in the field of supply chain management and we are looking forward to keeping you up-to-date on all the developments.
3 Supply Chain Trends to Watch
My aversion to “predicting things” aside, I believe it is important to be forward-thinking. An awareness of trends and changes to the operating environment are critical to informed decision making. After all, a lot of what will happen in the supply chain industry in 2015 will be shaped by developments in the surrounding environment i.e. natural disasters, government regulations, innovation/technological advancements, globalization, etc. That is what makes predicting the supply chain so difficult.
Leaving the future in the future, three current trends that will grow in influence in 2015 and have an impact on how supply chains are run include:
1. Corporate Social Responsibility (CSR) taking center stage
Corporate Social Responsibility deals with the integration of social and environmental concerns in a company’s business operations. I recently participated in a CSR twitter chat hosted by TriplePundit that included panel members from PricewaterhouseCoopers and Campbell’s Soup. I figured there was no getting around the topic of supply chain management when talking CSR, but to be sure the topic was addressed, I submitted my question in advance:
— David W. Weaver (@Weaver_davidw) January 6, 2015
Much to my pleasure, before my question was even asked, Dave Stangis from Campbell’s Soup addressed the growing importance of a sustainable and responsible supply chain management strategy. Speaking from the perspective of the food sector, Stangis responded to the question of what CSR activities stood out in 2014:
— Dave Stangis (@DaveStangis) January 6, 2015
— Dave Stangis (@DaveStangis) January 6, 2015
What is happening at Campbell’s Soup is definitely a trend that will carry over to other businesses in 2015 and is in line with the prediction I listed above about “suppliers becoming trusted partners.” It is important that supply chain managers do not underestimate the difficulty of aligning core values with suppliers, as these supplier networks are expansive and often include contradicting cultural values.
2. Marketing the Supply Chain
Some of the most powerful marketing tools today are the wide array of social media platforms, and the supply chain industry has certainly taken notice the past few years. Back in April of 2013, I wrote an article on the 3 main impacts social media is having on the supply chain, which included:
- Strengthening supplier relations
- Creating transparency
- Enhancing internal processes and communication
Social Media and the supply chain also gained momentum in 2014 with the introduction of Procurious, a niche social platform designed specifically for supply chain and procurement professionals.
Furthermore, in 2014, Kate Lee from Fronetics published some results from a study on the growing benefits of the use of social media within the supply chain and logistics industries. These benefits include:
- Increased customer retention
- Increased demand for products and services
- Increased leads
- Shortened sales cycles.
In addition to social media marketing, supply chains have been brought to the forefront through the various media outlets. Something we saw a lot of in 2014 were the press releases from large corporations highlighting their efforts in the area of CSR and sustainability. These corporations have been flaunting their accomplishments in the reduction of CO2 emissions and water usage, as well as their commitment to paying fair wages and sourcing from environmentally conscious suppliers. There is clearly a consensus amongst these big players that consumer perceptions in these areas are changing, and the importance of this shift cannot be ignored.
Lastly, we are seeing more and more companies open their supply chain doors to consumers through innovative marketing campaigns. Here are a few examples of the transparency trend:
- Dole – “Visit Our Farms” Campaign
- Busweiser – “Do You Know Where Your Beer is Brewed” Campaign
- Chobani – “How Matters” Campaign
These types of campaigns can be highly effective in today’s socially-conscious consumer environment. They, however, carry with them a significant amount of risk. Depending on the level of transparency offered, these companies open themselves up to competitors. Furthermore, if one of these companies were to run into a scandal with a supplier somewhere in their complex networks, the backlash from consumers would be immense. Nobody wants to buy products from hypocrites (or better, exposed hypocrites).
3. Technological Advancements
In October of 2009, Dan Gilmore from SupplyChainDigest wrote an article titled “Supply Chain 2015,” in which he predicted what will be going on in the world of supply chain management in 2015. Well, 2015 is here. I certainly enjoyed reading Dan’s predictions and found the following abstract extremely insightful/foresightful:
“Web-based supply chain software comes to dominate the landscape: I haven’t completely been on this bandwagon until recently, but by 2015, this is how it is going to be – which has many major implications. More confident of this than about any other prediction on the list. Once this becomes the lead approach for almost all vendors, the shift will happen rapidly.”
No matter what supply chain conference or event you visit in 2015, it is guaranteed to be filled with booths and presentations from software providers promising they can help you with your supply chain and logistics processes – in the cloud/on the world wide web – right now! Dan was spot-on back in 2009.
Aside from advanced software solutions, technology is progressing faster than ever, giving supply chain and logistics managers enough to think about in 2015:
- Driverless automobiles / driverless deliveries
- 3D printing / Additive manufacturing
- The Internet of Things and Smart Factories
- Cyber Security
- Voice-picking warehouse technology
- Social Media
- Collaboration platforms
- Big Data Management
- Wireless / Mobility
That is an overwhelming list of technological advancements that were all extensively covered in 2014. That being said, drawing on one of the main takeaways from the European Manufacturing Strategies Summit this past year, if companies don’t get back to the basics of supply chain management, implementing these helpful technologies will be next to impossible.
Understanding the importance and ensuring the integration of all planning processes across the various supply chain functions, including purchasing, production, logistics marketing and finance, is a great place to start. Team work, change management and excellent leadership will also help companies successfully adopt some of these technological changes in the coming years.
So there you have it, my list of supply chain trends to keep an eye on in 2015. I think I may have slipped up and made a few small predictions of my own throughout the article, but for the most part, I stayed prediction-free.
Now it’s your turn: What trends do you believe will have the biggest impact on the supply chain in 2015?