In the face of major societal changes, businesses must constantly adapt to remain efficient. To meet these existing challenges, they must make their supply chains a strategic priority. Faced with increasing supply chain disruptions and pressures, logistics and supply chain stakeholders must continue to demonstrate agility, innovation and resilience, while addressing critical societal and environmental issues.
What does the future hold for tomorrow's supply chain?
Recent years have been marked by a succession of events that have forced businesses to evolve rapidly. "This year again, the main challenges supply chain teams are facing are constant disruptions, rising costs and pressure related to sustainable development," recalls Terence Leung, Global Senior Director at Blue Yonder.
In the latest study[1] conducted by the company, one of the leading businesses in supply chain technology solution systems, 84% of surveyed companies report having faced disruptions of all types: Shortages of raw materials, as well as workforce, delivery delays, limited transport capacities... This represents as many significant risks on the operational, reputational or financial level.
The instability of the geopolitical context, which is particularly marked by global conflicts, also amplifies these uncertainties. The repercussions translate into a general increase in prices for transport, stock management, materials and labour. This forces the supply chain to effectively optimise its costs by tracking waste.
Lastly, the climate crisis is accelerating, its consequences are already being felt and their unpredictability forces businesses to remain on alert. Logistics and supply chain players are more than ever expected to control their carbon footprint. Especially as regulatory requirements are being strengthened in this area.
Faced with these major challenges weighing on the global economy, supply chain leaders must drive rapid changes that will have a positive impact on their market and, more broadly, in society.
Accelerating the transition to a sustainable supply chain
The supply chain has a major role to play on the environmental front, particularly in terms of greenhouse gas emissions. Transport ranks second among the sectors that emit the most CO2 in the world, after energy.
Supply chain and logistics managers must continue their efforts to align their strategy with the company's commitments in this area. This involves implementing and monitoring reliable measurement indicators, while adopting a continuous improvement approach.
Transport and supply chain logistics stakeholders can focus on several levers:
- The transition to low-emission means of transport;
- Networks and routes optimisation;
- Pooling of receptions and shipments;
- Local products sourcing;
- Suppliers CSR assessment;
- Improvement of return processes;
- Packaging optimisation.
Becoming a driver of social change
Beyond the ecological dimension, businesses must also use their supply chains as a driver of change in society, an evolution expected by all. Organisations have the power to change markets through their supply chain networks. The change takes place in the way of identifying, managing and supporting suppliers.
Procurement and supply chain represent a large part of any company's turnover, depending on its sector of activity. This offers them a prime position to integrate a social approach in supplier relationship management.
Here are some examples of actions a company can implement by relying on its relationships:
- Include clauses guaranteeing respect for people in calls for tenders;
- Take advantage of commercial contracts to push suppliers to improve working conditions in the manufacturing system;
- Support organisations that focus their efforts on positively impacting society;
- Animate the partner community through training and networking.
Recruiting and retaining new talent
To meet the new challenges of supply chains, companies must enrich their teams with new skills. This inevitably involves developing human resources strategies that promote learning, equity and diversity.
While the job market remains tight, the changing expectations of employees must also be taken into account. Recruitment and retention of talent are increasingly linked to the environmental and social commitment of companies.
According to a study[2] conducted in the United States, 54% of respondents would accept lower pay to work in an organisation better aligned with their values. Companies are therefore faced with the challenge of recruiting employees who are seeking meaning or looking for a good work-life balance.
Several levers for attracting and retaining talent should be considered:
- Flexible working conditions (remote working or flexible hours);
- Social benefits (employee savings, retirement plans, childcare service...);
- Career development support (mobility, training, mentoring...) that offers prospects for evolution.
Continuing the digitalisation of the supply chain
Lastly, it is essential for companies to continue the digital transformation of their supply chain. This is a key lever for productivity, responsiveness, competitiveness and growth. This is why the vast majority of companies are increasing their investments in digitalisation and automation of some repetitive or low added-value supply chain operations.
New technologies are at the heart of these changes:
- Business software dedicated to the supply chain (WMS[3] and TMS[4]) are effective tools for optimising the management and real-time visibility of goods flows.
- Cloud adoption allows companies to access the latest technological innovations at a sustained pace.
- Robotics is becoming more widespread to automate logistics activities, on the one hand, but also to streamline supply chain processes and gain productivity on the other.
- Generative Artificial Intelligence (AI) is set to transform the user experience, playing the role of a personal assistant to facilitate exchanges, solve potential supply chain issues, train new recruits...
Companies are committed to transforming their supply chain to face a challenging, uncertain and competitive future. This inevitably involves solid investments in human resources and technologies to increase the sustainability and efficiency of the supply chain. All this while integrating the principles of Corporate Social Responsibility (CSR) throughout the entire supply chain.
