5 Supply Chain Challenges to Watch in 2021

Updated: Mar 5, 2021

2020 was the year that businesses and supply chains have been disrupted by the pandemic unanticipatedly. The future is always uncertain, perhaps now more than ever.

2021 will witness more supply chain complications to be resolved, yet it will still open windows for organizations to utilize the interruptions. The global pandemic has concurrently lashed the supply chain industry, reaffirmed its value, and set up new vision and target for years to come.

Companies are reviewing their processes, networks, systems and partners while supply chains are at the foremost position of the scheme.

Here are 5 supply chain challenges to watch in 2021 and the methods you can crack them up.

1. Disruption and change management enhancement

A recent article published on InboundLogistics.com invited 26 CEOs to answer the question “What supply chain adjustment would you have made at the start of 2020 if you knew then what you know now”. Among all responds, “change” was the keyword which has been mentioned for most times (7 times).

With the weight of disruptions and changes expanding, it is critical to concentrate on tackling them in addition to getting around them.

In volatile environment, resilience and flexibility are significant traits for a successful supply chain. A resilient supply chain can forecast the weather change before the storm comes. Recent years of trends have led to underlining on lean processes over the kinds of redundancies that enable disruptions smoother to manage. A flexible supply chain is capable of adjusting to fluctuating market needs and conditions without delay.

It is never too late to set up change management system for specific sorts of events, such as focal point people and protocols. In such wise, businesses can leverage its own resilience and flexibility to pre-plan for extensive disruptions.

2. Omnichannel establishment

2020 has taught us that if one business has not figured out every available channel to serve its clients, it is behind the peers. Retail, distributors, e-commerce, direct-to-consumer, all available channels are built up, if only one of them is disrupted, the show will keep going.

For omnichannel fulfilment, there are two additional expectations to meet, first one is demand forecasting. Companies need to consolidate demand across every channel and have a holistic view into every point of supply to be able to optimize service levels, balance costs and boost revenue.

The other one is service maturity. When it comes to online ordering, returning process for repair, refund or recycling involves diverse parties operationally and financially.

To a successful omnichannel fulfilment, inbound, outbound and reverse processes are continuously being challenged and refreshed for utmost customer satisfaction.

3. Employee technical competencies development

Working from home has become the new normal in 2020 for all walks of life, and 2021 is foreseeable to carry on with that way. Companies would have to do a lot in skills development area to empower work from home possibilities.

One of the subjects in the new normal is to maintain the organization culture united and integrated while team is separated physically. This is where the skills development system needs to identify new approaches to engage.

Various technologies are being adopted by end-to-end supply chain industry, such as Artificial Intelligence (AI) for process automation, Internet of Things (IoT) for live tracking, blockchain for transparency and etc. It has been acknowledged that multiple technologies cannot be treated as isolated service. While specific applications rely on technology experts to design, test and apply, strong push toward integrating and layering technologies is the new topic for supply chain professionals.

Internal technical upskilling arrangement relating to state-of-the-art technologies is a mutually beneficial solution in the new normal through which companies invest least resources to cultivate employees with cutting-edge technology knowledge as well as promote team spirit.

4. Leverage the value of data

Rapid advancements in the digital data analysis have been a popular trend for numerous companies in recent years, but the real value of those data is greater than it is ever seen. The more applications and technologies business has acquired in the value stream, the more data it is generating every second.

We Forizons always believe that to achieve business impacts with data requires a three-phases ecosystem: Capture, Analyze and Respond.

A good example for leveraging the value of data is Coca Cola. The beverage giant embedded data transition modules in each vendor machine to analyze the sales with time series so as to Identify the geographic preference on drink, design the advertisement accordingly and reserve more space for popular drinks.

5. Technologies adoption for efficiency and visibility

In the early days of Industry 4.0, advanced technologies like Autonomous Mobile Robots (AMR) and Artificial Intelligence (AI) are integrated for mainly efficiency improvement. Algorithms can perform operations automatically to save time and eliminate human error.

The potential of AMR and AI are much more than that. For instance, on the transportation end, drone delivery and driverless vehicles might become normal soon; AI could be used to identify patterns and forecast demand taking multiple factors into account.

Gaining supply chain end-to-end visibility is the backbone of previously mentioned points: disruption and change management, omnichannel fulfilment. In the era of digital transformation, visibility is achievable from technology adoption.

IoT devices can be fitted on shop floor for real-time production tracking which allows companies to monitor end-to-end process.

Like IoT, blockchain works in the direction of uplifting visibility. Blockchain enables data to be shared with all concerned parties across supply chain, which is a much securer approach than cloud sharing.

Difficult chapters bring frustrations and it motivates sparks and breakthrough. The ever-changing outlook of the supply chain world is inspiring and dynamic.

Do not be surprised that 2021 challenges are not that different from ones of years past. Disruptions and changes are inevitable, right team with appropriate tools empowers businesses with efficiency and visibility to adapt to all kinds of environment.

2020 has been a challenging year with ups and downs 2021 Forizons is ready to tackle all obstacles with you