Supply chain management has undergone a dramatic transformation since the advent of digital technologies. From the rise of multi-tier supply chain management in developing economies to the lessons learned from recent global events, such as the pandemic and geopolitical tensions, the supply chain landscape is continually adapting. The need for green supply chain management, leveraging lean processes and industry 4.0 solutions, has also become increasingly prominent.
Amid these changes, Enterprise Application Software (EAS) has emerged as a powerful tool for reshaping and optimizing supply chains. More and more businesses are leveraging EAS for supply chain efficiency with every passing day.
The Evolution of Supply Chain Management
Supply chain management (SCM) has come a long way from its traditional roots. It’s no longer just about moving goods from point A to point B; it’s about optimizing every facet of the process, from sourcing raw materials to delivering finished products to consumers.
One critical shift in recent years is the recognition of supply chain management as a key driver of business success. As evidenced by the astounding growth in the SCM market, businesses have started investing heavily in technologies and strategies that enhance their supply chain operations. The figures speak for themselves:
- The SCM market is projected to reach a staggering $20.24 billion in 2022, making it the fastest-growing market in Gartner’s enterprise application software category.
- Warehouse Management Systems (WMS) have become indispensable, with 83% of warehousing and logistics companies in the US adopting them between 2015 and 2021.
- The supply chain industry is on a growth trajectory, with a Compound Annual Growth Rate (CAGR) of 11.2% expected from 2020 to 2027.
- Supply Chain Management Software is set to generate revenue of around US$17.58 billion in 2022.
- The integration of robotics and automation is poised to make a significant impact, with 60% of businesses across all industries anticipating their influence on supply chains by 2025.
- On average, businesses are projected to spend $5.09 per employee on Supply Chain Management Software in 2022.
- The top supply chain challenges identified include supply chain shortages and disruptions (57%) and the acquisition and retention of skilled personnel (54%).
Challenges of Modern Supply Chain Management
The modern supply chain landscape is fraught with challenges that demand innovative solutions. To fully appreciate the significance of EAS for supply chain efficiency, let’s take a closer look at these challenges:
- Increasing Supply Chain Risks: Market volatility, trade disputes, climate change, and various other factors contribute to heightened supply chain risks.
- Rising Freight Costs: Increased energy costs and surging demand for container shipping have driven up freight prices.
- Delayed Chains: Global supply networks are prone to delays due to their multi-phased, long-distance nature.
- Demand Forecasting Issues: Anticipating figures for manufacturing and inventories has become exceedingly difficult.
- Issues in Digital Transformation: Integrating technologies like IoT, AI, drones, and robotics into existing supply chain processes can be challenging.
Overcoming SCM Challenges with EAS
Enterprise Application Software offers a comprehensive solution to address the challenges of modern supply chain management. Here’s how EAS can help businesses optimize their supply chains
EAS allows for precise tracking and monitoring of inventory levels, enabling businesses to understand their needs and anticipate supply chain disruptions. E-commerce companies can employ supply chain diversification to expand their pool of suppliers, reduce costs, and improve customer service.
EAS facilitates inventory planning, order management, and the ability to handle supply chain delays efficiently. Moreover, effective communication with customers is crucial during supply chain disruptions, allowing companies to manage expectations and address issues promptly. It also enables the creation of contingency plans to tackle unforeseen difficulties, ensuring business continuity during periods of high sales volume or supply chain disruptions.
Robust Supply Chain Management with Enterprise Application Software
Supply chain management software is a revolution in EAS for supply chain efficiency for businesses in addition to cost control, and resilience in their supply chain operations. EAS helps reduce expenses related to inventory management, quality control, and payment processes, leading to cost savings.
By identifying and monitoring supply chain risks, EAS enables businesses to anticipate and mitigate potential disruptions. Moreover, it streamlines processes, automating tasks such as order processing, invoicing, and shipment tracking, saving time and reducing administrative costs.
EAS also provides real-time access to crucial data, enhancing decision-making and demand planning. In addition, it helps businesses adhere to compliance regulations by integrating compliance controls into processes, reducing the risk of non-compliance.
What’s Next for Supply Chain Management?
The future of supply chain management is marked by resilience, adaptability, and technological advancements. To overcome unforeseen disruptions, businesses will focus on supply chain resilience, leveraging robotics, AI, automation, and digital twins.
Blockchain technology will bring transparency to transactions and processes, and cloud-based solutions will continue to expand.As supply chains grow larger and more complex to meet customer expectations, the role of EAS for supply chain efficiency and competitiveness will remain pivotal. STL Digital’s immense expertise in developing and deploying state-of-the-art technologies is the backbone of various manufacturing companies and trust in the abilities that it brings to the table.