7 Supply Chain Software Trends to Watch in 2023 – Modern Materials Handling
It helps a company control costs, alleviate risks, see what’s going on in their supply chains and get more done with less. Long considered a vital aspect of any provide chain, transportation management systems (TMS) , warehouse management systems (WMS) , enterprise resource planning solutions (ERP) and other platforms work either independently or together to help shepherd goods from the point of origin to their final destinations.
Along the way, software also supports accurate forecasting, good decision making, high levels of visibility plus better control over the world’s increasingly complex, intertwined supply chains. As we move further into 2023, here are seven important supply chain software program trends that are either already taking shape or currently standing by on deck for the particular remainder associated with the year.
1. We’ve entered the era of “digital intelligence. ”
End-to-end visibility has long been the Holy Grail for supply chain and logistics managers who now want tools that leverage that visibility into better decision making. Analysts have begun referring to this as “digital intelligence, ” and Laurent Lefouet , chief customer and strategy officer at Aera Technology , sees it as a key trend that will only accelerate in 2023. “It’s about moving through visibility to execution, ” he explains, “and thinking beyond ‘knowing what’s going on’ in order to actually executing on those decisions. ”
To meet the challenge, vendors are switching up their own software algorithms, introducing new models plus folding a lot more advanced technology like artificial intelligence (AI) into their particular platforms. These advancements are helping shippers move away from producing “manual” decisions as they work to respond in order to fast-changing provide chain situations. Instead, they’re using dashboards, data analytics, control towers and automation to quickly address emerging issues or even take advantage of brand new opportunities.
2 . The Cloud continues to reign.
The fact that more companies are investing in Cloud-based software isn’t exactly news, but it’s the trend that’s expected in order to continue—and even accelerate—in 2023 and beyond.
“Cloud is almost a deal breaker at this point for companies investing in new supply chain software, ” says Michael McCullough, vice president, NA and supply chain lead at Capgemini. “On-premises solutions are more the particular exception than the norm. ”
For example , McCullough still encounters some companies that are using legacy, on-premises WMS, but says Cloud as a whole is in “very high demand” right now. One of these applications’ biggest selling points will be the fact that they can be updated in the background and on a regular basis without the need for disruptive upgrades.
“Companies are much less accepting associated with only getting a software update every couple of years, ” says McCullough, who also sees more shippers playing an active role in helping to “shape” any new upgrades, features and capabilities that will their suppliers are working on. “Customers expect to have the seat in the table in terms of the software’s roadmap, ” he adds, “and want a lot more collaborative relationships with their vendors. ”
3. Supply string platforms are usually being enhanced and improved.
For its most recent WMS market study, ARC Advisory Group pinpointed one major brand new trend: nearly all large WMS providers were putting money into their platforms, and at a higher degree compared to usual. Much of the particular emphasis is usually on the Cloud from this stage, says Clint Reiser, ARC’s director associated with supply chain, but vendors are also looking for new ways in order to enhance plus improve their platforms in order to fulfill the needs of the particular modern client.
“There’s more development money going into the actual systems and into making them Cloud-native, ” says Reiser. Software developers are also using more microservices, which allow them to use “contained building blocks” within their applications. These types of microservices support simpler adaptation, change, updates and development without having to take down an entire system to make all those alterations. “That way, ” says Ast, “customers are always on the particular latest version of the software program. ”
4. Everyone wants more digitization and automation.
According to Koray Köse, senior director plus analyst with regard to Supply String Research and Advisory with Gartner, 99% of organizations plan in order to invest in growing technologies over the next five years.
Citing a recent Gartner “Supply Chain Technologies User Wants and Needs Survey, ” Köse states that the key drivers behind these initiatives include the need to support brand new business/operating models (for 36% of companies), improve resiliency and agility (35%), plus enhance decision making (35%).
Other companies are purchasing digitization and software because they want to drive efficiency improvements (31%) and manage the particular labor shortage (26%). To address their labor constraints, Köse says 92% of companies that Gartner surveyed are exploring new use cases for advanced robotics. “Those robots rely on software regarding both orchestration and enablement, ” this individual adds. “Without software, these people wouldn’t function. ”
5. Software platforms are converging.
As he looks around at the supply string software ecosystem, Köse is definitely seeing more “integrated” provide chain administration (SCM) solutions on the market. Larger providers are usually buying best-of-breed, entrepreneurial-type businesses that specialize in specific applications. This helps the larger software developers address a bigger marketplace.
In the particular meantime, private equity and venture capital firms are acquiring companies in the space that is really come up onto their radar screens as a result of the global pandemic plus subsequent supply chain challenges. “Last 12 months, we saw a lot of brand new startups and smaller businesses enter the market, but now that’s beginning to show signs of converging, ” Köse says. “As a result, the solutions themselves are a lot more integrated—not necessarily fully ‘one stop shops, ’ yet definitely applications that target more than one particular area. ”
6. Removing the latencybetween “planning” and what happens within real-life.
As they will continue down the road to recovery and begin preparing for what is coming around the next corner, organizations are usually turning to software in order to help all of them reduce the particular time it takes to respond to real-world events.
In other words, they would like to remove the latency between their planning and what actually happens in real-life—a need that became more important than ever during the pandemic. When they can reduce that latency, companies can better manage their inventory, suppliers, work and some other resources in a way that meets their own customers’ demand.
To get there, they have to be able to identify individuals areas of latency and then address those issues with alternate sourcing, production or shipping options. “When markets shift, companies have to be able in order to react rapidly, ” says Lisa Henriott, senior vice president of product marketing at Logility. “Using today’s advanced software platforms, they can more effectively optimize their supply plans, realign manufacturing, explore different contract manufacturing options plus work along with alternate suppliers. ”
7. Driving down risk is a key concern.
Companies have come to realize that what was once thought of as a “constant state of disruption” has simply become the new normal. Instead of addressing issues as they arise, for example, organizations are learning how to deal with—and constantly preparing for—disruption and risk.
“Reducing risk is a key concern for companies right now, ” says Philip Vervloesem, senior vice president at OMP USA. In response, he says that more of those organizations are using an approach he calls “boundary-less planning. ”
This is the particular process of building up network resiliency across logistics, sourcing, supply, production or other areas, and then using a tactical execution strategy to identifying and effectively reducing danger. This, in turn, helps companies respond to risk in a more reality-based manner—versus only making predictions about what “might” happen and reacting as they do happen.
Vervloesem states automation plays an important role within boundary-less preparing, which requires the right balance of human intervention plus automation. And due to the number of players in any network, he says collaboration and connectivity have also become extremely important with regard to organizations throughout most industry sectors.
“Being able in order to have a closed loop with your co-workers, customers and suppliers is extremely important, ” Vervloesem adds, “because it enables you to shift gears a lot faster, versus having everyone working in silos, which can result in delayed decision making and greater risk. ”
Replace or upgrade? How to make the choice
If your company will be part of the 99% of firms that will be investing in emerging technologies over the new few years—and we’re going in order to guess that it is—there are usually some key considerations to think about before producing those investments. In most cases, you’ll be picking between upgrading an existing piece of supply chain software or completely replacing it with the new solution.
Lefouet says a good starting point is to ask yourself this question: What will really make the biggest difference in how efficiently we operate because a supply chain organization? In some cases, the answer may be to enhance an existing answer, but within other cases the better choice may be in order to rip-and-replace that platform along with something new.
plus suppliers is very important, because this allows you to
shift equipment a lot faster, compared to having everybody working in silos,
which usually can lead to delayed making decisions and higher risk. “
“Some businesses may not want to do a replacement because their existing solutions still work, while others may become replacing due to the fact their platform is being sunsetted in a couple of years, ” Lefouet points out. “While others may upgrade in order to gain access to the more modern tool that features new capabilities. ”
For best results during this process, furthermore consider where the investment and effort is going, and after that whether that will pay off for your own organization within the form of a positive return on investment (ROI).
“No matter how you look at it, this is a big decision, and especially if you can only make one major software program investment during any given year, ” states Lefouet. “If you have two projects in mind plus aren’t capable to do both at the particular same time, you should look carefully in which 1 will make the biggest distinction. ”