Supply Chain Shortages are Driving the Need for Better Inventory Software
Since the start of the pandemic, we have witnessed massive supply chain disruptions caused by shortages in one area or another in various industries.
From the dry yeast shortage that started in 2020 driven by people spending more time at home and picking up baking as a hobby, to the massive run on hand sanitizer as consumers raced to find ways to keep COVID 19 at bay; it now seems that all supply chains need to be ready for unexpected shortages of goods complicated by large surges in demand, at least for the foreseeable future.
Archaic means of tracking and managing inventory are no longer viable options for supply chain professionals in the current landscape. Rather, there needs to be immediate, widespread adoption of the best available technology in order to identify and address these shortages before they lead to catastrophic outcomes. In other words, any company that is not already utilizing the latest in inventory management software for their supply chain needs to consider getting started on that right away.
In this article, we will examine the necessity of leveraging the best available inventory technology in the market, how the use of this new tech can help your business overcome unprecedented supply shortages, and what this may mean for the future of supply chains in general.
How Have Supply Chain Shortages Forced the Adoption of New Tech?
There are four primary reasons why supply chain shortages are pushing the industry to adopt the latest inventory-based technology:
The World is Now Too Complex for Pen and Paper Methods
With global interconnectedness inherent in supply chains these days, the old methods of pen and paper-based management are no longer appropriate or efficient enough to actually keep up with growing demand from consumers. Things can change 10 times within a minute, and all parts of the supply chain need to know of these changes quickly. Therefore, processes that involve businesses individually obtaining and logging data that doesn’t provide enough transparency to everyone involved in the supply chain need to be replaced with fully-fleshed out inventory management software.
Automated Processes Will Catch Things that People Won’t
We all make mistakes and miss details from time to time. However, with the help of automated processes, this no longer has to be the case.
Critical data regarding product availability might be missed by the human eye, but with the help of automated platforms that are designed to locate specific indicators, the chances of any sort of miscount or other overlooked errors are greatly reduced. This doesn’t mean that people will no longer be involved in these processes.
Rather, they will serve as overseers, keeping everything running smoothly and making sure that these automated inventory decisions are appropriate.
Demand Is Now Unpredictable Across the Board
There is incredibly high demand throughout several industries right now. Meanwhile, some products and services are actually in less demand than before the pandemic. This confusing dichotomy makes it extremely difficult to predict the future of supply in certain industries with the use of human monitoring alone. Luckily, technology can provide real-time data to help businesses make inventory decisions that are not typically encountered outside of large-scale events.
Consumers are Insisting Upon Next Day Delivery and Easy Returns
Because of the rise in the use of e-commerce over the past 2 years, consumer expectations regarding delivery times have shifted drastically and rapidly. Companies now need to be flexible when it comes to their inventory supply strategy in order to cater to the expectations of same-day and next-day delivery. When companies start to lag or are unable to fill orders quickly, regardless of the reason, consumers will move on to the next business on their list.
How Can Improved Inventory Technology Help Us to Overcome Supply Chain Shortages?
There is no better way to examine how efficient inventory technology can help businesses navigate supply chain shortages than our current battle with COVID 19. Three of the most important ways that inventory technology can assist us in solving the issues surrounding supply chain shortages as they relate to the pandemic are as follows:
Early Alert Technology
The unique demand created by the pandemic allows for an excellent case study in how quickly decisions need to be made about inventory management and adjustment. For example, many hospitals can now spot trends in coronavirus cases earlier than before, enabling them to stock up on ventilators and other necessary supplies for their communities before they are overrun by a wave of infections.
With real-time data pertaining to supply, entities such as schools and hospitals can instantly communicate with suppliers and know whether PPE is expected to be in short supply, for instance. This enables quick decision-making with regards to how much of this PPE should be stored in preparation. And when we are talking about critical equipment or tools that can save someone’s life who works in a high-risk field, being able to track those goods or prepare for impending delays in supply is critical.
In a very unique situation that presented itself last year, some alcohol distilleries noticed that a slight shift in their production could enable them to help address the shortage of hand sanitizer. These companies quickly pivoted from making alcohol to making hand sanitizer, thus supplying health care facilities, businesses, and the public at large with a commodity that was in incredibly short supply for a time.
Without leveraging inventory technology, these companies would not have been able to make this switch in production as easily, and the shortage may have extended much longer than it did in 2020.
What Is the Future of Supply Chains as New Technology is More Widely Adopted?
By all appearances, it seems as though companies who continue to resist the implementation of the latest inventory technology will soon be left behind. The switch to newer technology such as implementing drone capability, automating processes, and redesigning buildings to accommodate these changes will not happen overnight.
However, it will happen quickly across the industry landscape, and businesses should start making plans now if they want to stay competitive.
It should be restated: human oversight will always be an incredibly important part of every process. People with trained eyes need to be monitoring these processes to ensure that the technology is working as designed and that the decisions that are being made make sense for the current state of the supply chain.
This point is critical, as many businesses reject automation, thinking that it will replace the need for human workers altogether. Rather, businesses need both technology and human touch to function at their optimum level. This has always been the case and will continue to be so as we move forward.