80% of Manufacturing and Supply Chain Executives Say the Digital Supply Chain Will Be the Predominant Model within Five Years
IMAGE CREDIT: MHI
MHI announced during ProMat 2017 the release of the fourth in a series of MHI Annual Industry Reports developed in collaboration with Deloitte Consulting. The 2017 MHI Annual Industry Report, titled “Next-Generation Supply Chains: Digital, On-Demand and Always-On,” provides new insights into trends and technologies that are having a dramatic impact on supply chains and the people who run them.
New Insights from the MHI ProMat 2017 Report
Every year since 2014, the MHI has put together its Annual Industry Report in partnership with Deloitte Consulting. During the ProMat 2017 event, the fourth edition of this report was released with the title “Next-Generation Supply Chains: Digital, On-Demand and Always-On.”
In the MHI ProMat 2017 report, nine technologies were highlighted for their role in creating new supply chain technology that is available on-demand and always-on. The new models that were presented are expected to become the new reality for supply chains in the near future. Of those surveyed, eighty percent expected digital supply chains to become the most prevalent model within five years. Sixteen percent believed that they already were.
The Nine Technologies that Are Transforming Supply Chains
When the MHI Annual Industry Report was launched three years ago, eight innovative technologies were identified as having the potential to transform digital supply chain logistics. The 2017 report provides updates on these eight areas in terms of their potential to disrupt the industry, their adoption rates so far, and barriers to their adoption by companies today.
These are the eight original technologies listed:
- Inventory and network optimization
- Sensors and automatic identification
- Cloud computing and storage
- Robotics and automation
- Predictive analytics
- Wearable and mobile technology
- Autonomous vehicles and drones
- 3D printing
In the 2017 survey, a ninth innovation was added to the list: the Internet of Things (IoT), which has an increasingly important role in the digital economy.
Trends in the Perception of Importance and Adoption Rates of These New Technologies
One of the primary purposes of the report was to assess the trends seen in digital supply chain technology among industry leaders and how their adoption is progressing over time.
Disruption or Competitive Advantage
When compared to the data collected in 2015, survey respondents who contributed to the 2017 report cited increase potential for disruption or competitive advantage with the following technologies:
- Robotics and automation (61%, up from 39% in 2015)
- Predictive analytics (57%, up from 38% in 2015)
- The Internet-of-Things (IoT) (55%, new category in 2017)
- Sensors and automatic identification (53%, up from 42% in 2015)
- Driverless vehicles & drones (54%, up from 30% in 2015)
Adoption Rates for New Technologies
The two digital supply chain technologies with the highest adoption rates are cloud computing and storage (50%) and sensors and automatic identification (49%). These rates are expected to increase to 73% and 70% in the next two years.
The technologies that are expected to be adopted most frequently over the next two years are inventory and network optimization (forecast at 75%), and robotics and automation (forecast at 63%). The two other technologies that follow these are the IoT (with 54%) and Predictive Analytics (at 52%).
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