Introduction
A 21st-century competitive environment has become a key factor contributing to the efficiency and dynamicity of the market economy. Technological changes driven by globalization make merchants invest in digital solutions to enhance their business productivity and remain in demand on the market. Thus, in the course of the overall transition to digitalized supplies, the size of the global supply chain management market is forecasted to grow from USD 25.74 billion as for 2022 to about USD 72.1 billion by 2023 based on the estimates.
Transformation of traditional supply chains into more flexible systems promotes more efficient approaches to cost management and ensures enhanced end-user values. In this way, digitalization allows for automating and accordingly streamlining and simplifying all the supply chain processes.
Hence, this article will highlight the essential components that contribute to the seamless operations of supply chains and their adaptability to the ever-evolving business landscape.
Understanding the roles
Generally, information technologies integrated into supply chains find their implementation in scheduling, sourcing, data analytics, and supplier relationship management (SRM). Still, their capacities are capable of enhancing far more processes than mentioned above. So, let’s consider their application and benefits in supply chain management (SCM).
IT Infrastructure in SCM
The efficiency of collaboration and data sharing between stakeholders is driven by the implementation of cloud-based solutions, software, and advanced communication networks. Choosing the right IT solution to be integrated into the supply chain is crucial. When powered by a well-designed IT infrastructure, it becomes more streamlined and visible. For this reason, one should apply high technological solutions that will align with the chain goals.
For example, these may be transportation management systems, warehouse management solutions, enterprise resource planning programs, fleet management systems, etc. Along with that, well-configured hardware serves as a foundation for the successful functioning of the supply chain powered by software.
Needless to say, the Internet is an important asset in the supply chain infrastructure, too. The connectivity between stakeholders, immediate transfer of information across the chain, and activities like online procurements and auctions are heavily reliant on the quality of the internet.
Tracking and Visibility
Effective management of supply chains is now associated with their real-time visibility. The seamless flow of information from one authorized staff member to another ensures better collaboration between them which consequently leads to an easier workflow. With relevant data available, managers can instantly respond to changing situations and make more informed decisions.
On top of that, sensors, GPS, RFID, and other tracking solutions allow for real-time observation of goods movement. The transparency achieved through the implementation of the specified technologies guarantees improved control over inventory and ensures more accurate demand forecasting.
Data Analytics for Informed Decision-Making
Choosing the right option among the range of available alternatives may be quite daunting. The traditional approach to making decisions is often associated with numerous factors like previous practices, personal values or emotions, intuition, analysis of possible risks, and uncertainties associated with the choice of action to be performed. But today, IT solutions allow stakeholders to apply a data-driven approach in decision-making. Advanced analytics tools are capable of giving insights into real evidence and up-to-date information that aid businesses in identifying trends and patterns, predicting and mitigating risks, and, therefore, making more nformed and rational decisions.
Cost reduction
Automation of processes within a supply chain ensures more efficient leverage of resources and assets as all the parties involved are motivated to use them in a reasonable way. Apart from that, the manual work is delegated to IT tools that perform it in an accurate and seamless way. This allows business owners to reduce the staff number and exploit their resources to deal with more complex tasks.
The rapid development of technology in the 21st century has resulted in the availability of all products. This greatly contributed to the emergence of trends for various offers and discounts, consequently causing the reduction of the goods cost.
Cybersecurity Measures for Supply Chain Protection
Statista reports that about 11 million customers in the world were affected by supply chain cyber-attacks in 2022. Among the most common incidents were counterfeiting, drive-by compromise, and malware infections. For this reason, enhancing the security of the supply chain should become a key priority for businesses.
It’s important to protect any point of the supply chain that is indicated to be vulnerable to attacks. This may be achieved through the implementation of blockchain, maintenance, and regular audit of software utilized in SCM, minimizing any risks, educating the staff, and promoting cyber security awareness among them. Any enterprise should take all necessary measures to be able to respond to any kind of cybersecurity issues, minimizing the chances of data breaches.
Final words
One can hardly deny that IT has played a paramount role in supply chain evolution. With transparency and data-driven decision-making, supply chains can operate more efficiently than ever before. In fact, the advanced solutions have opened up the doors to a new generation of SCM applications. The Internet and other networks are capable of learning from past performance and determining the amount of product needed offering cost-effective methods for warehousing or delivering it to a retailer. Undoubtedly, IT will continue to progress, transforming supply chains into more advanced and secure systems.
