The Challenges of an All Adaptive Technology Supply Chain
2020 presented ample opportunities for supply chains to demonstrate their adaptability. From government regulations to changing consumer demands to environmental disasters, it seemed like the hurdles would never end. As the pandemic stretched on and the expectations of supply chains continued to grow exponentially, it became clear that adaptive technology was going to be the only way for businesses to survive in the future.
But while adaptive technology may very well be a saving grace for companies, it is not without its challenges, and the proverbial problem of teaching an old dog a new trick is never easy.
What is an Adaptive Supply Chain?
Put simply, an adaptive supply chain is one that can adjust to any changes that may present. Whether these changes occur due to shifts in demand, supply chain disruptions, or other factors, an adaptive supply chain can respond and continue to operate without having to pause and reconfigure operations.
In many cases, supply chains are made to be more adaptive through improvements in technology such as AI and the integration of machine learning technology. Leveraging this type of technology cuts down on human error such as dirty data and speeds up operations significantly.
Additionally, cloud technology has made businesses incredibly adaptable by improving visibility in ways that were never before possible. No matter where businesses have to operate from, due to social distancing regulations or any other factor, all of the necessary information can be accessed through the cloud. Before this technology, it would have been much more difficult to recover from something like the COVID-19 pandemic, which created a lack of ability for companies to directly communicate across the supply chain.
What are the Benefits to an Adaptive Supply Chain?
The upsides to an adaptive supply chain are many:
- Businesses have an improved ability to respond to changes in consumer demand.
- Relationships between businesses within the supply chain are stronger and more flexible when materials are unavailable or in short supply.
- Processes within a company are made more efficient and transparent, leading to improved supply chain performance overall.
- Inventory storage and processing operations improve, regardless of the inventory management strategy in place.
- Internal communication is made easier, leading to the ability to better address issues before they become bigger problems.
If individual businesses are not willing to implement adaptive practices, the entire supply chain suffers.
What are the Challenges of Implementing an Adaptive Technology Supply Chain?
Even though the benefits of adaptive technology are clear, many businesses are resistant to making the switch. This may be due to a number of reasons including:
- Cost: As with any decision, it often comes down to cost. Will switching to a more adaptive system impose a significant upfront cost? This is certainly possible. But this is a classic example of not seeing the forest for the trees. While the initial cost may give business owners pause, it’s important to realize that the impacts of COVID-19 are not going away, and there is every possibility we could face an even more devastating disruption in operations down the road. If companies do not prepare now by instituting these changes, there’s every chance that they could face catastrophic consequences as a result of the next major supply chain issue and be left behind. That being said, companies who did plan ahead by instituting the proper adaptive measures will be able to continue operations and keep the engine running.
- Training: New technology requires new skill sets. Because of this, training is often required to educate teams on how to conduct operations when using different methods than they are used to. Training takes time and money, but there’s no substitute for being prepared for what seems to be inevitable future disruptions in our suppl\y chains.
- Fear of the Unknown: Businesses may, quite simply, be resistant to tech that they have not worked with before. New AI, cloud, and automated processes (such as those implemented for middle-mile delivery processes) can be scary things for businesses that have always used pen and paper methods. For these individuals, it’s time to take a deep breath and realize that not keeping up with the trends will eventually make their business obsolete.
It has always been the case that those who are willing to embrace the newer, more efficient technology will be able to adapt and thrive while those who are stuck in their ways will have difficulty competing. This has been true throughout all of human history and remains so today.
While it’s certainly possible that COVID-19 was a one-off situation, it’s equally possible that strong viruses and climate disasters will become more common as time goes by. If our supply chains are unprepared and unable to adapt, it could lead to issues that will be very difficult to recover from. Those that are preparing now by implementing the latest adaptive technology will need only tweak their operations as problems arise in the future.
Those businesses that have not begun to work with adaptive technology may have great difficulty in surviving the next COVID-19-level disruption.