Top 5 Motivating Factors for Investing in New Supply Chain Technology

There are many reasons a company might invest in new technology for their supply chain strategy, and for each of those reasons, there’s a corresponding solution. Whether they know it or not, technology will play a crucial role in the future success of the supply chain.

Recently, Gartner® published Predicts 2023: Supply Chain Technology, a report about how “growing complexity and volatility are forcing supply chain organizations to adjust their technology investments to align with their needs for resiliency, agility and intelligent operations.”1 From the discovery of technological impact to future predictions for strategic planning, this research serves to aid supply chain technology leaders.

Let’s examine what the Gartner research uncovered as the five key factors motivating supply chain investments in emerging technologies over the next five years.

1. Support New Business Models

Over the last few years, organizations have been forced to adapt to rapidly changing market demands and industry standards. This adjustment involves restructuring business processes and adopting new technologies to ensure expectations are met, and you remain competitive.

Implementing new business systems and integrations can be a costly venture. Still, the TrueCommerce blog, The Hidden Cost of Delay, displays how putting off these updates can actually end up costing you more. Even with the urgency of executing the necessary upgrades and changes to your business, selecting technology solutions that will meet your company’s needs is essential.

2. Improve Supply Chain Resiliency & Agility

This shift in business models and supply chain processes leads to a growing need for improved resiliency and agility. The events of the last few years have proven just how quickly things can change, and businesses are seeking solutions that will allow them to prepare and respond to disruptions effectively.

Supply chains should be able to withstand disruption, mitigate its effects, and grow through the impacts of weather events, geopolitical events and policies, economic conditions, and automation failures. To strengthen your supply chain, you’ll need to examine many different areas of business operations, including your technical solutions and decision-making.

3. Enhance Decision Making

Another leading factor for investing in emerging technologies is the ability to enhance decision making, with the Gartner report stating that “30% of respondents reported that decision making speed and quality was a top three internal challenge for their organization’s supply chain goals and objectives.”1

Your decisions are only as good as the data they’re based upon, so it’s important to invest in fixing the following problems if you have them: poor data quality, lack of internal IT resources/support, poor integration across applications, availability of data, and difficulty with existing or aging applications (e.g. ERP). These are all supply chain blind spots you might be missing.

4. Improve Process Efficiency & Productivity

Boosting efficiency and productivity is a motivating element and a no-brainer that is often the result of optimizing other various factors of supply chain strategy and operations. From managing inventory and supplier relationships to ensuring compliance and customer satisfaction, supply chain leaders are exploring emerging technologies to address the needs of their supply chain processes.

For example, when Mommy’s Bliss landed a contract with the nation’s largest retailer, Walmart, they needed to find a way to scale their business and stock their products in 3,800 stores nationwide – in just six weeks. In addition to that, Walmart also required that all financial transactions be automated through an EDI-based solution. Today, EDI integration enables Mommy’s Bliss to manage account relationships with many large retailers, meeting all their diverse EDI, labeling, and shipping requirements.

“EDI, in general, streamlines our order processing and keeps everything running efficiently.”
– Alexandra Skogstrom, Account Manager with Mommy’s Bliss

5. Address Labor Constraints or Shortages

Technology is playing an increasingly important role in the supply chain as labor challenges continue. Companies everywhere are experiencing staffing shortages and difficulty retaining skilled labor. In fact, nearly half of U.S. companies can’t fill open positions due to a lack of applicants, let alone applicants with the relevant skills necessary for the jobs.

From AI and machine learning software to robotics and autonomous machinery, businesses are looking towards digitization to alleviate labor constraints. For example, Microsoft is “working to create programs for manufacturers to accelerate digital adoption and enable them to bring their workforce along,” while fire pit manufacturer Iron Embers “leverages data analytics in its operations and hiring.”

Leveraging Technology to Optimize Your Supply Chain

Determining which technologies to invest in can be difficult, but understanding where your vulnerabilities are can help. Some companies may need help with just one of the factors above, while others may need assistance with all five. Alternatively, organizations might not require new technology but should evaluate their current systems and providers to ensure they are delivering optimal results.

Here are just a few of the technologies to explore to address these business goals:

Electronic Data Interchange (EDI)

Implementing electronic data interchange (EDI) eliminates tedious manual data entry, saving time and reducing errors. Because of this time savings, workforce personnel can be more productive and focus on more value-added projects.

Additionally, a cloud-based EDI solution supports enhanced efficiency and scalability with its ability to process large volumes of data in minutes from anywhere without the need for additional servers or staff. This means that your brand can adapt to shifts in demand effortlessly.

ERP Integration

As companies look to expand their brand and develop new strategies, they require a solution that seamlessly integrates with their business processes and systems. ERP integrations connect your ERP system with your accounting, inventory management, and sales systems, providing end-to-end visibility across multiple channels.

This visibility into all your supply chain processes allows for enhanced decision making while enabling the automation of a wide range of tasks for increased productivity.

Vendor Managed Inventory (VMI)

With a vendor managed inventory (VMI) solution, businesses can simplify the inventory management process by enabling the manufacturer to collect real-time sales and forecasting data from buyers. This data, combined with preset inventory goals, then uses machine learning to create recommendations for replenishment orders. VMI not only improves inventory management processes but enables enhanced decision making regarding materials purchasing.

The results of integrating technology into the supply chain are apparent, and industry leaders recognize the value of supply chain investments. At TrueCommerce, we provide the technology and expertise required to help you achieve efficiency throughout your supply chain. From EDI transactions to replenishment programs, we have solutions that can quickly make a difference.

Contact us today to learn more about EDI, ERP integration, VMI, and other supply chain solutions from TrueCommerce! Also, be on the lookout for our upcoming webinar to dive deeper into the Gartner report later this month.

1Gartner, Predicts 2023: Supply Chain Technology, Dwight Klappich, Christian Titze, Tim Payne, Amber Salley, Simon Tunstall, November 28, 2022. GARTNER is a registered trademark and service mark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and is used herein with permission. All rights reserved.