Gareth Berry examines three of the biggest predictions made about the
manufacturing and logistics industries 12 months ago and how they have fared at
the end of the year.
A new year is an excellent time for making predictions for the months
ahead. As real news slows, the media turns to forecasts for everything from
consumer spending and politics to interest rates and sport. How reliable are
these predictions and can a business plan their strategies based on mere guesswork?
Prediction 1: The rise of the
demand-driven supply chain
The increasingly popular subject of agile methodologies has led to considerable
discussion about changing the focus of the supply chain from pull (forecast-driven)
to push (demand-driven). However, creating a market-responsive system relies on
the ability to readily access and share data along the supply chain,
specifically requiring accurate knowledge of inventory, exceptional visibility
into demand and consumption, and agility to quickly act on changes.
Even five years ago, the technologies to support such a view were not
accessible to many organisations, especially small to medium enterprises due to
cost and resource considerations. However the advent of the cloud brought apps
for every logistics need within the reach of all businesses, offering the
opportunity to gather more data about their business, market and customers than
ever before. Companies adopting agile approaches to the supply chain were also reporting
solid market success leading to the prediction that the demand-driven supply
chain would finally gain momentum.
Twelve months on, we may not have seen the end of the forecast-driven
supply chain but it’s clear a shift has begun. Demand-driven strategies are
gaining adherents and continue to intrigue the market. With additional
developments such as big data on the horizon, it’s reasonable to assume that
the change from pull to push will continue into 2015.
Prediction 2: Big data and
analytics
The last year has
seen everyone spruiking the unrealised value of big data, better explained as the
mass of structured and unstructured data that sits within every organisation. The
idea was that mining this information by correlating diverse, previously silo-ed
data would help organisations gain insights into improving production, better
forecasting demand, and engaging in analytics among others. Many vendors were
said to be working hard to develop ways of easily and quickly harnessing the
data last year, with analysts predicting that big data would be one of the
biggest trends of the year ahead.
While the topic has definitely made waves, primarily among large
enterprises and government departments, big data still remains a tool for the
future. There is huge potential and everyone agrees there will be benefit from
using big data; however, it is still not clear exactly how data should be used,
what data should be used, or what benefits can be gained from the data.
In the meantime, use cases will emerge almost by stealth as business
applications begin to engage a wider range of organisational data. Cloud
applications are expected to lead the way in this trend because of their
comparative agility and reach.
Prediction 3: Need for systems upgrade
will see businesses become more open to new technology
The ERP and supply chain systems that are being deployed today are
vastly different to those of five or ten years ago. Cloud technologies, mobile
apps, mobile devices and social media are redefining the way business is
conducted with users having tremendous flexibility to select from on-premise,
cloud and hybrid systems, integrated suites of applications and best-of-breed
solutions. Unlike old-style solutions that embraced a certain predictability,
technologies that enhance responsiveness and agility are key in the post-GFC
world.
The prediction that businesses would be more open to new approaches to
technology in 2014 was accurate. But it can equally be applied to most of the
last five years and to every year in the foreseeable future. When everyone in a
market is chasing competitive advantage, openness to new experiences,
approaches and methodologies becomes an essential trait.