Industry Trends: Supply Chain and Logistics
The supply chain is the lifeblood of industry. No matter how advanced the product or service, industry depends on supply chain and logistics to reach the consumer. An ever-expanding network of transportation, warehousing, and inventory makes it all possible – along with the logistics that are constantly evolving to meet new demands.
In this article, we’ll look at some of the key supply chain trends -- as well as a glance ahead to what the future may hold and what it means for the workforce.
Trend #1: Omni-Channel Distribution
E-commerce plays a commanding role in the way we acquire goods and services, but according to Tim Brown, managing director for Georgia Tech’s Supply Chain & Logistics Institute, omni-channel distribution takes us one step beyond.
“Omni-channel distribution enables customers to interact with the seller in multiple ways to select, purchase, and deliver items,” Brown says. “So, if you look at The Home Depot for example, you can buy from the website and have it delivered to your house. You can buy it from the website and pick it up at the store, or you can just go into the store and pick it up off the shelf.”
These options increasingly extend to both small and large scale products -- as well as services.
“When The Home Depot started, it was basically just a warehouse or store that you roamed around in and picked up things,” Brown says. “Now, there are multiple different ways to interact between retailers and consumers. That's a big driver of change.”
Trend #2: Robotics
With increasing complexity in the supply chain and the added demands of omni-channel distribution, robotics and artificial intelligence are becoming more important.
“Companies are looking to AI, robotics and related technologies to help them manage the complex channels, different flows, and different inventory pools,” Brown says. “So where companies used to want to avoid complexity and try to be very simple and have very defined roles in the supply chain, now companies like Amazon and The Home Depot are embracing complexity.”
Automated vehicles continue to offer a great deal of promise, but Brown stresses that the trucking industry won’t change over night. Certain parts of the country, such as Georgia’s I-16 corridor between Savannah and Macon, will serve as effective initial targets for automation. Savannah is home to the Port of Savannah, the fastest growing and fourth busiest port in the nation and the largest single-terminal container facility of its kind in North America. Semi-automated systems such as platooning or flocking, which allow a single driver to handle linked vehicles, will likely arrive ahead of fully automated fleets.
Trend #3: Additive Manufacturing
Additive Manufacturing or 3D printing is also a major game changer in supply chain and logistics. Previously, products left the factory only to be stored for weeks, months, or even years. Now, an increasing number of products are created on demand.
“In Atlanta, Adidas actually makes shoes in an on-demand center,” Brown says. “So, instead of guessing what's going to sell and in what sizes, and distributing them throughout the world; they just make them on demand.”
Additive manufacturing can improve the availability of spare parts for a given product, and Brown believes it could also enable more sustainable products that can be easily renewed or recycled.
“A lot times, an item reaches the end of its life and has to be scrapped because it's made up of hundreds of thousands of parts that are too hard to take apart to reuse,” Brown says. “But you can 3D print some of the items and design them so they can be easily disassembled and put into the supply chain again.”
Trend #4: The Physical Internet
Manufacturing 4.0 is transforming the landscape of industry through the widespread adoption of new technologies. Advancing alongside it is a leading-edge global logistics system termed the Physical Internet: a revolution in transportation planning that transforms the way physical objects are moved and stored.
The aim is to create a leaner, more effective supply chain in which companies share infrastructure -- such as trucks and warehouses -- for maximum efficiency. Advancements in AI, the internet of things, and blockchain make this sort of sharing possible.
“If companies can feel comfortable with these technologies and they know where their items are, then they can open up and share,” Brown says. “It’s like how we share cars now with the Uber model. Why not do the same thing with freight?”
Looking ahead to the future, Brown is hopeful for the merging of people mobility and freight mobility. While some forms of transportation, such as air transportation, move both cargo and passengers, most forms of transportation keep them separate.
“MARTA could be moving freight through Atlanta, particularly at night” Brown says. “Even during the day, there could be a couple of freight cars so that freight’s moving under the city instead of through it on trucks.”
While major shared people and freight initiatives are further off, a number of start-up companies are already exploring what’s possible via a transportation networking system -- including the Atlanta-based Roadie.
“Let's say you need to send a bed or something from your mother to your aunt and you don't want to bother with a regular van line,” Brown says. “With Roadie, you find somebody who happens to be traveling between those two points and they agree to stop by and pick it up and move it.”
What does this mean for the workforce? Industry data provided by the O*NET Resource Center indicates that supply chain and logistics jobs are on the rise. The opportunities go far beyond truck and forklift drivers, encompassing everything from data analysis and cloud solutions.
“There are also exciting roles involved in supply chain planning, risk management, and strategic supply chain gaming involved in supply chain tradeoff analysis,” Brown says. “They leverage technologies such as immersive reality, geographic information systems, artificial intelligence, and data analytics.”
As with jobs in manufacturing, supply chain and logistics workers have to roll with continuous change in the digital world – but the jobs themselves are not going away.
“Many young people aren't attracted to logistics because they think it's hard, physical work,” Brown says. “Obviously there are a lot of jobs like that, but there are a lot of exciting jobs in supply chain and logistics that people should think about: perhaps starting in operations but then moving to managerial or tactical planning roles leveraging the latest technologies.”
GTPE offers a robust list of professional development options to prepare supply chain and logistics professionals for success in this field. Check out our overview of the learners we served last fiscal year.