Report: Autonomous supply chains on the way

Fast-changing customer needs require digitally networked and autonomous supply chains, but just a quarter of supply chains currently have such advanced capabilities, according to a recent Supply Chain Reinvention Survey by consulting firm EY Americas.

Digitally networked supply chains connect suppliers and customers via the cloud or by directly integrating data, with end-to-end visibility up and down the supply chain, according to the study's authors. Autonomous supply chains are fully automated and require little to no human presence; they also use robotics to fulfill orders and are beginning to use driverless forklifts, the authors said. Although the study showed that few supply chains have such capabilities today, more than 50 percent of executives surveyed said they expect autonomous supply chains by 2025, according to the survey.

This is putting many companies on the fast track to adopting advanced technology systems that can help them improve market share and customer satisfaction. The study authors noted that:

• 90 percent of respondents with autonomous supply chains reported that their market share increased somewhat or significantly in the past year, compared to 7 percent of linear supply chains (in which digital connectivity to suppliers is limited to sharing spreadsheets and email).
• 97 percent of respondents with autonomous supply chains reported that their customer satisfaction somewhat or significantly increased in the past year, compared to only 8 percent of linear supply chains.

"We know today's transformative age will force all aspects of an organization to evolve-and the supply chain is no exception," Glenn Steinberg, EY Global and EY Americas Supply Chain Leader said in a statement announcing the survey results. "Supply chain executives have an opportunity to be the drivers of change, bettering the customer experience while improving speed, efficiency, and safety in the process. Our [survey] underscored that digitally networked supply chains will be best positioned to thrive in the future. We also saw supply chains that are digitally networked or autonomous report increased market share and customer satisfaction compared to their linear supply chain counterparts."

EY Americas' Supply Chain Reinvention Survey 2019 also touched on other issues that are reshaping today's supply chain, including a talent shortage and sustainability issues. According to the survey:

• 55 percent of companies said they are retraining employees in the supply chain function for digital technologies, but they cited a lack of skilled employees as the #2 obstacle for a successful supply chain. Just 44 percent said their employees are prepared for digital innovation in the supply chain.
• Over the next three years, sustainability is the #2 priority for supply chains, behind increased efficiency; 90 percent of companies with autonomous supply chains reported that sustainable management reduces costs in the long term, versus 25 percent of those with a mostly linear supply chain.