Supply Chain

IDC: The Future of Supply Chain

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What are the challenges and technologies shaping the future of supply chain?

We’re living in what some call the age of disruption, where digital business and globalization are disrupting business models and industries and changing the way we live and conduct business. According to IDC, this will translate into 33 percent of all manufacturing companies being disrupted by digitally-enabled competitors by just 2018-2019.[1]

Fifty years ago, the life expectancy of a Fortune 500 company was around 75 years. Today, it’s less than 15 years. According to a study by Washington University’s Olin Business School study, 40 percent of Fortune 500 companies will be ‘extinct’ in just 10 years. How does a company survive and thrive in such a challenging environment?  “It is nearly impossible to predict the future,” as noted by the authors of the Gartner whitepaper Supply Chain 2025: Planning Today for Tomorrow, “but by examining current trends, we can prepare for the unknown.”

The IBM Institute for Business Value (IBV) Chief Supply Chain Officers (CSCO) study found that “the executives charged with managing supply chains are under severe pressure. As suppliers and information flows multiply, supply chains are becoming more complex, costly and vulnerable. And executives are finding it increasingly difficult to respond to these challenges, especially with conventional supply chain strategies and designs.” An agile supply chain is key to an agile business, to the survival and success of the business. And in this global and digital age, companies and their supply chain organizations must be able to pivot and adapt to stay ahead of the competition. Having insight into the trends and forces impacting global markets and business operations goes a long way in helping a supply chain, and a business, stay competitive.

In a recently published point-of-view providing insights into how supply chain organizations are preparing for the future, The Path to a Thinking Supply Chain examines the key challenges, technology trends influencing the direction of supply chains – and the ‘defining characteristics’ of the future supply chain. The paper discusses how technologies like IoT, blockchain and artificial intelligence are impacting business – and the future supply chain.

As Simon Ellis of IDC notes in his presentation, The Thinking Supply Chain, these technologies are converging in supply chains and will have tremendous impact on future operations.  He notes, “Every business of every size risks fundamental disruption because of new technologies … and new ways of doing business.”  Ellis notes that what he calls a ‘Thinking’ or cognitively enabled supply chain, will be he says, “a digitally-enabled thinking supply chain offers the potential for dramatic benefits” and that “by 2020, 50% of mature supply chains will use cognitive computing/AI and advanced analytics.”

The business and technology landscape is rapidly evolving, but the trend lines are clear:  cognitive and other disruptive technologies will play a defining role shaping the supply chain of the future.  Although the road ahead promises to be more disruptive and competitive, the future supply chain holds the promise, through the application of cognitive technologies, to become more transparent and agile.

Read The Path to a Thinking Supply Chain here.


[1] The Thinking Supply Chain, IDC, March 2017

Program Vice President, Supply Chain Strategies, IDC Manufacturing Insights

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