68% of supply chain executives say they have constantly experienced high-impact disruptions over the last three years, with many not having the time to recover from one disruption before the next. If anything, 2022 has further proved that facing disruption is now a natural part of any supply chain. Over the next 12 months, supply chains are going to continue to be affected by labour shortages, strike action and economic downturn. Supply chain managers need to focus in on ensuring smooth operations despite any volatility from outside factors.
- Combatting a recession
Back in November, the Bank of England warned the UK may fall into its longest recession yet. Economic downturn naturally puts more pressure on supply chains, but demand usually stays the same. Buyers still want their goods and as they have less money, they’re reluctant to splurge. Businesses will recognise this, looking to keep their prices as low as possible to keep sales high. As part of a knock-on effect, manufacturers will barter with supply chains to help them reduce costs further. However, since supply chains already run on minimal margins, they will look at other ways to cut costs whilst maintaining operational efficiency.
Accuracy throughout warehouses is going to be key in 2023. Errors are particularly costly for supply chains with each returned parcel costing up to £20 due to issues like transportation and storage. With supply chains being burdened by the need for speed, an investigation into how organisations can reduce picking and packing mistakes whilst keeping pace up is vital. There’s a large range of different technological solutions that can help organisations with this. For example, the hands-free nature of voice-enabled technology reduces workers’ need to view a screen for instructions. Voice-picking solutions provide employees with instructions through their headsets, requiring them to use a microphone to confirm. This ensures workers are focussed on picking and packing the right items, reducing the number of errors.
Throughout the pandemic, tech has been spotlighted as a means to navigate uncertainty, providing organisations with agility, flexibility, and scalability. In 2023, having the ability to easily streamline operations will act as a superpower.
- Navigating the tight labour market
With a recession on the horizon, many organisations will start to cut staff levels to keep costs low. However, supply chains have been faced with a tight labour market for several years now. Cutting staff numbers isn’t an option in 2023 – organisations must learn to do ‘more with less’ and give workers the right tools to keep productivity levels up.
The retail landscape has changed with the rise of online shopping, with 63% of online shoppers expecting a three-day delivery as standard. In 2023, warehouses will continue to face pressure to quickly pick and package orders – according to VDC research, 46% of respondents named faster delivery the top challenge they are facing. To ensure organisations are keeping up with demand, there will be further investment into tech like co-bots, voice picking devices and wearable scanners to speed up workers’ tasks.
A shortage of workers isn’t a new supply chain issue, but it is one that organisations must continue to push through. Those organisations that provide their staff with the right tools to assist their work will be able to keep up with demand.
- Strike action to continue
This past year has been full of strike action from rail staff to bus container ports and Royal Mail. In December, retailers warned customers that gifts bought online may not be delivered by Christmas due to postal strikes. Without union workers’ needs being met, strike action may continue throughout 2023 and interrupt supply chains from working smoothly. Whilst supply chains themselves aren’t able to control strike action, having real-time visibility into operations will help organisations navigate this disruption.
No matter the sector or industry, all supply chains involve hundreds of different pieces of tech and machinery. Industrial Internet of things (IIoT) will ensure supply chain managers are able to quickly identify and fix problems with machinery, keep devices up to date as well as track items on the move. As IIoT automatically transfers data between devices without human intervention, supply chain managers can relieve pressure within warehouses by focusing on tasks like managing logistics and production control.
Having full visibility over operations ensures processes are smooth, free from error and fast-paced. Supply chain organisations can then quickly pick, pack and deliver items to customers despite any disruption.
As a whole, keeping operations fluid will assure supply chain leaders that the bottom line is being met and customer satisfaction stays high – no matter the disruption faced.
