A supply chain is a network of people and organisations working together to ensure that goods are delivered to where they need to be. Without supply chains, the world as we know it wouldn’t exist, and if they suddenly disappeared we’d certainly know about it. Supply chains are an essential cog in the world’s economy, and they require a lot of very talented people to keep them going. However, we also rely on supply chain technology to keep the links in the chain strong, and without this tech, both global and national economies simply wouldn’t function.
Every organisation in the industry heavily relies on supply chain technology, whether they’re at the start or the end of the chain. In this article, we’ll define what we mean by supply chain technology, have a look at how it benefits the supply chain, and discuss some of the main technologies used in supply chain management.
In this article
What is supply chain technology?
Supply chain technology can be defined as the digital equipment that supports the organisation and efficiency of the supply chain. By harnessing the power of supply chain technology, links within the supply chain can gather huge amounts of data and use it to make improvements to their operations, implement new processes, improve their efficiency, or plan for the future.
There are a huge amount of supply chain technologies currently in the network, with varying degrees of sophistication and impact. In their simplest form, supply chain technologies allow users to input data or send important messages instantaneously, whereas more sophisticated technology includes AI and robotics. While the latter are clearly more impressive, the vast majority of supply chain technology plays a vital role in the network, and shouldn’t be taken for granted.
- 57% of companies believe that supply chain management gives them a competitive edge that enables them to further develop their business. (GEODIS, 2019)
A supply chain manager, or other stakeholders within the chain, will always be looking for ways to make their supply chains easier to manage and more efficient. It’s an important role, for the quicker that goods can be refined, manufactured, processed, and delivered, the more money their business will make and the more satisfied customers they’ll have. Therefore, a supply chain manager should be constantly engaged with their technology, searching for ways to streamline and improve it.
To respond to this need, supply chain technologies are constantly evolving, with new technology being developed every year. While some tech – especially in the field of automation – might seem impressive today (and it is), it’s safe to say that it’s incomparable with the advanced technologies the future holds.
In time, we should expect to see a global digitisation of the entire supply chain, with increasingly intelligent AI and robotics working together to make continuous improvements to supply chain efficiency. It’s an appealing prospect for both suppliers and consumers, as one will be able to cut down on unnecessary costs while the other gets better quality products much quicker.
The benefits of supply chain technology
As mentioned above, there are vast quantities of supply chain technology, and naturally each of them has its own advantages towards everything from manufacturing operations to product delivery . With that in mind, here is a more holistic overview of the benefits that supply chain technology can bring when working together in the supply chain network.
Accessible information and data
The sheer amount of data in your average supply chain is staggering. Good supply technology can improve data quality, helping to streamline the data into what’s important, and presenting it in an accessible way. Analysts can then use supply chain analytics to improve the supply chain and make informed business decisions, whether that’s proposing changes to cut costs, change processes, invest in new technologies or team members, and so on.
Consumer grade supply chain technology can take this a step further and further improve accessibility to allow companies to make well informed decisions without needing to develop their analyst skills as much as those who do it as a profession.
Another important role supply chain technology plays in data accessibility in facilitating the sharing of data and information between different departments, companies, and technologies within the supply chain. One basic example of this is when software collates data on consumer buying trends, which can then be shared with forecasters so they can better predict supply and demand. Taking this concept a step further, forecaster could then send data to the marketing department so they can plan social media campaigns based on these predictions. With supply chain technologies, organisations can ensure that data can be used as effectively as possible without being locked in a silo.
Improved Order Management
eCommerce businesses can use an Order Management System (OMS) to help manage their inventories across different channels and streamline the supply chain process from point of purchase to delivery. They can be a hugely powerful tool for a business who sell medium to high volumes of goods, as through an OMS a business can update inventories across a wide range of channels, learn which SKUs are selling best on each channel or region, and make informed decisions in regards to which products to push, which to scale back, and which to retire completely.
- Companies can reap a 25% increase in productivity, a 20% gain in space usage, and a 30% improvement in stock use efficiency if they use integrated order processing for their inventory system. (EasyPost, 2019)
A sophisticated OMS will talk to other technologies in the supply chain. This is beneficial to both the seller and the buyer because it can make the fulfilment process far quicker. An OMS can do most of the heavy lifting for you, whether that’s automatically processing the order, printing shipping labels, eliminating human error, communicating with your customers on your behalf, and much more.
An effective OMS is essential for ambitious businesses looking to scale up. It can take invaluable time off your hands, hugely speed up your fulfilment process, and make a lot of customers very happy along the way.
Improved Warehouse Management
If an eCommerce business is actively fulfilling large quantities of goods, it’s likely that they will be using a warehouse to store their items. A good warehouse management system (WMS) will complement an OMS to help fulfil orders quicker and allow businesses to get the most out of their warehouse capacity and space.
An WMS can help supply chain managers ensure that they don’t pay for any unnecessary warehousing space. For example, you store 1000 of a particular SKU, but only ship one per week, then a WMS can relay you the information so you can get better use out of the space. Rather than throwing money at space for unpopular SKUs, you can use the space to fill with products you know will sell.
Better customer service
As alluded to above, you can offer far better customer service when harnessing the power of supply chain technology. On a broader scale, having proper supply chain management will improve your business operations as a whole, thus having a general positive impact on your customer’s experience. You should be able to process and ship your products faster, which is becoming increasingly more important as customers come to expect next-day delivery when shopping online.
When supply chain technology is fully integrated into your fulfilment process, you can improve customer service by keeping them informed at each stage of their order. In theory, you will be able to tell them when you’ve received the order, when it’s being processed, when it gets dispatched, where it is in the world, and when it’s been delivered. This level of transparency goes a long way in keeping your customers coming back. Throw in a bit of personalisation and you’ve got a real recipe for success.
Time is the most valuable resource at our disposal, and having sophisticated automation in your supply chain can save a lot of it. Searching through spreadsheets for important data, contacting customers with important updates, and ensuring requirements are met for carriers takes a lot of work when done manually. You could do that yourself, or hire somebody else to do it, but when technology exists to do that for you, your time, and someone else’s, is better spent elsewhere.
Supply chain technologies can greatly relieve the burden of manual tasks. Businesses can use that time and resources to invest in new products, reach new markets, target new audiences, create new partnerships, spend time with their families, and so on.
Technologies commonly used in the supply chain
Some of these technologies have been around for a while, while others are in their infancy with technological advancements on the horizon. Either way, each of them is essential in keeping the modern supply chain functioning as it should.
The internet might not be a spring chicken anymore, but the way we use the internet as a tool for supply chain management is irreplaceable and ever evolving. The internet was once used as a way for personal computers to communicate with each other, but as time goes on, it seems as though all everyday items are connected to the internet in one way or another. We refer to this as the Internet of Things (IOT), and it’s a vital technology in supply chain management.
The number of cellular IoT connections is expected to reach 3.5 billion in 2023. (Dataprot, 2022)
IoT devices have revolutionised the efficiency of the supply chain operations, allowing us to verify the exact location of goods through GPS, track shipments and the movements of goods, monitor the storage conditions of our stock, process goods much faster, and much more besides. The IoT will only get better over time as more devices are added to the network.
The concept of automation isn’t particularly new in the eCommerce industry, but the ways in which we use automation are becoming increasingly sophisticated over time. In its simplest form, automation can take care of everyday tasks such as emailing order details to your customers, notifying you when stock levels are low, and printing the correct labels for shipping. We can expect to see robotics in the supply chain really take off in the coming decades, with AI and machine learning continuously improving the efficiency of manufacturing, fulfilment, and transport.
If you turned the clock back a few decades, you’d see offices in many industries with computers had a noisy room with servers to keep all of their digital data safe. To access that data you’d need permission, and you’d be unlikely to get permission if you didn’t work in the office. Cloud computing has changed all of that, as big corporations like Google and Amazon have their own encrypted servers which we can access from anywhere in the world. We’re also able to share that data with whoever we like, seamlessly.
The cloud allows stakeholders and machines to send and access important data wherever they are in the world, which helps businesses make smarter, real-time decisions about all things supply chain management.
Artificial Intelligence (AI)
Artificial intelligence and machine learning may seem a futuristic technology to some, but it is very much present in the world of eCommerce logistics. Thanks to AI, we can quickly scrape enormous quantities of data and present it in the form of useful insights.
Through these insights we can cut costs, plan to meet future trends, optimise delivery routes, reduce processing time, improve inventory and warehouse management, improve customer service, and much more. Ultimately, organisations that embrace AI can greatly enhance productivity and efficiency of their operations. The combination of AI and the cloud makes data accessible to stakeholders anywhere in the world, which simply wasn’t possible before.
What supply chain technology does James and James use for clients who outsource their fulfilment?
James and James was built from the ground up with supply chain technology in mind. Before we launched the business, we built our own cloud-based fulfilment platform, ControlPort, and after twelve years of updates and multiple awards, ControlPort is leading the way on fulfilment technology.
When we designed ControlPort, we needed it to fulfil the needs of both ourselves and our clients. At our end, the software allows us to pick and pack orders with 99.99% accuracy, and enables us to offer same-day dispatch for 97% of orders. As for our clients, the AI that powers ControlPort gives them real-time updates on the status of their orders, and offers them deep insights to make smart decisions regarding their inventory and warehouse management.
With ControlPort, clients can manage their inventories across multiple channels, including Shopify, Amazon, Woocommerce, and Magneto, just to name a few. The core features include extensive inventory management, warehouse management, shipping management, returns management, and real-time order tracking. You have full control over each aspect of these features, while our fulfilment team takes care of the logistics side of things.
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ControlPort also offers a wealth of insights, presenting you with clear data so you can make tangible decisions on how to best grow your business. You’ll be able to identify the most cost-effective shipping options to deliver your products anywhere in the world, identify seasonal trends, understand what sells and what doesn’t, and provide your customers with an unbeatable customer experiences, all while enjoying increased revenues.
Best of all, the combination of ControlPort and our logistics services means that you no longer have to spend the time sifting through enormous quantities of data, processing orders and returns, or manually contacting every single one of your customers. You can put that time and effort back into where it matters most.
To really see how ControlPort can benefit your business, why not book a demo so we can show it to you in action?
Supply chain technology frequently asked questions
What’s the most important part of the supply chain?
There is no easy answer to this question, for each part of the supply chain relies on several other links to be truly effective. Each link is important for different reasons, and the hierarchy of importance will depend on business goals, industries, and so on. Each component of the supply chain is important; it’s a vast, complex tapestry of interlocking parts.
Why is supply chain management important?
Due to supply chain complexity, supply chain management is vital to ensure they function properly, and so we can identify areas for improvement. This benefits all interested parties within the supply chain, and staying on top of supply chain management can give businesses and organisations a competitive advantage.
With good supply chain management, companies can boost sales, enjoy improved visibility of data, have a better understanding of high priority stock, deliver insights to stakeholders, anticipate future demand, and much more!
What are the most common supply chain issues?
There are fairly common issues at every point of the supply chain, some of which can be mitigated against, some which can’t. Some common issues that affect supply chains include scarcity of materials, inflation, inaccurate forecasting, congestion and borders and ports, obsolete our outdated tech, legacy systems, incorrect labelling / packaging, and general human error.
Should I hire a 3PL provider to manage supply chain logistics?
Hiring a 3PL provider can be a great way to get the most out of supply chain management with comparatively little effort on your side. A good 3PL provider will have invested heavily in supply chain management and technology, and have well oiled processes and warehouse operations to ensure goods get processed and delivered in a timely manner.
Using a 3PL can also put time back in your hands, as the time you previously spent on fulfilment can be put into growing your business.
What are the different stages of supply chain management?
At the top level, there are five stages of supply chain management. These are: Plan, Source, Make, Deliver, and Return. Each stage should have supply chain leaders at the forefront, continuously improving their area of expertise.
Want to know more? Get in touch with James and James
Now you’ve read the article, we hope you have a better understanding of what supply technology is, and why it’s so important. Having proper supply chain management is not only essential for your business to run as effectively as possible; it’s important on a global scale. Without proper supply chain technology, we wouldn’t be where we are today.
If you’re interested in learning more about our award-winning supply chain technology and how it can help your business, we’d love for you to get in touch. We can help you get the most out of your fulfilment and warehousing, giving you the time back to focus on what matters most: growing your business.