Data Analytics Can Fix the Supply Chain. Eventually Posted on : Nov 18 - 2021

Can data, analytics, and artificial intelligence save the supply chain? It’s a question that corporate boards may be asking their CIOs. After all, technology came to the rescue helping many organizations address the challenges brought by the COVID-19 pandemic such as remote work and online commerce.

But problems with the supply chain remain a lingering and painful reminder of how upside-down the world still is, even as office workers trickle back to their pre-COVID routines a few days a week. Ships continue to be stacked up off the coast of Los Angeles.

Restoring flow to the supply chain that has been clogged by unpredicted changes in supply, demand, production, and labor shortages will take time, according to experts. Investing in technology to gain visibility and transparency into the supply chain is one of a few steps that CIOs can recommend to the rest of the C-suite to gain ground against the current problems if they are impacting your enterprise, according to experts. On the flip side, companies that continue to fail to invest in supply chain technology may not survive. Technology investment is mandatory … but it’s not enough to fix the current crisis.

“The current state of the supply chain is the new normal,” says John Fay, who joined multi-enterprise supply chain network solutions software provider True Commerce as CEO in December 2020. Even as organizations struggle with the malfunctioning supply chain in the physical world, they are looking to apply technology for the help it can provide. Fay says that his company saw a 90% increase in drop-ship orders last year as manufacturers skipped physical stores and warehouses to take their products directly to consumers. This is one of many changing patterns in how products were delivered in response to problems with the supply chain, retail closures, and other limitations imposed by the pandemic.

Who Won the Pandemic Supply Chain?

If your CEO or board needs proof that supply chain technology can, in fact, help with supply chain problems, just look at the winners who succeeded during the pandemic itself versus those companies that struggled or failed. Top performers such as Lowes, Walmart, Target, and Amazon had all invested in technology and other solutions to help them gain visibility and transparency in their supply chain, according to Cindy Elliott, head of business sector strategy at GIS (geographic information systems) data, mapping, and technology company Esri.

“These companies were able to be more responsive immediately to a ripple happening somewhere else and make adjustments faster,” she says.

But many other companies did not make technology investments ahead of the COVID disruption. Elliot notes that the supply chain is considered a cost center by companies, so there’s always been a “how do I get it cheaper” approach.

“There are industries that are slower to lean into technology. When you digitize an environment, it’s a game-changer,” Elliott says. “The supply chain is an industry that’s been slower to adopt technology, and that results in a variety of different dilemmas. It leaves us where we are right now.”

Companies like Amazon have been able to capitalize on their supply chain technological superiority, gaining even more of an edge over companies that were unprepared for a supply chain disruption. View more