6 Ways the Supply Chain has Transformed in the Last 20 Years (part 2)

Sarah Aswell


by Sarah Aswell


Last week we wrote about 3 of the ways the supply chain has changed in the last 20 years.  This week we continue this article series with a further 3 ways and consider what supply chain management will look like in the future.

4. Ever-increasing globalization.

Yet another result of the recent wave of technological advancements is the global village and marketplace: as more efficient systems and more responsive supply chains develop, vendors, suppliers, and customers are increasingly located overseas and across multiple continents. Like many of the other transformations in supply chain over the last 20 years, globalization has come with both advantages and challenges. Although globalization has positively affected some aspects of costs, operations, marketing, and other areas, it has also added the issues of risk management, government involvement, environmental concerns.

5. The need for risk and uncertainty planning.

Several international events over the last 20 years have exposed a new vulnerability of supply chains that has developed alongside globalization. Acts of terrorism, such as the events of September 11, 2001, paired with catastrophic natural disasters, such as the 2011 floods in Thailand, clearly illustrated how even a single political, legal, financial, or natural event can cause significant disruptions across nations – disruptions that could last years and be financially ruinous. For example, according to Thailand’s Department of Industrial Works, an estimated 7,510 industrial and manufacturing plants were affected by the floods, causing a shortage of an array of products around the world. Now, for the first time, a vital aspect of supply chain management includes understanding risks and planning for uncertainty.

6. The rising importance of sustainability.

Both financial and environmental concerns have placed the issues of sustainability, energy conservation, and product stewardship front and center in the minds of supply chain managers in recent years. Supply chains necessarily consume significant amounts of natural resources and impact the environment – and changes to this consumption involve changes to supply chain operation. Concern for the costs of this consumption is growing, both because of business’ changing guidelines and philosophies and because of governmental interventions via new policies, restrictions, law, and practices.

The Future of Supply Chain Management

Looking back, many of the above trends and changes could have never been predicted or imagined even a few decades ago. However, although it is difficult to say what is in store for the supply chain in the coming years, many agree that continued advances in technology will be the main driving force behind the future evolution of SCM. Currently, managers are reporting:

* Radio Frequency Identification (RFID) across all processes so that goods may be tracked at all points in the process.The expansion of software as a service. 

* Cloud solutions.

* The growing importance of service chains. 

* The possibility of artificial intelligence in supply chain processes.

* Even greater moves toward supplier collaboration.  

Of course, as we have seen, a world event – or even a relatively simple new idea from a great mind – could change the course of SCM evolution and procurement contracting in a totally surprising way.

Keep Up With the ContractRoom Blog

ContractRoom is a great example of how technology has changed the face of supply chain management in recent years. To learn how our contract management software can help you discover the power of organized, data-driven negotiation, we invite you to schedule a demo today. To learn more about all of these topics, visit www.contractroom.com and click the Let's Talk button to book your free demo.

About the author

Sarah Aswell

Sarah Aswell

Sarah Aswell is a freelance writer and content strategist who writes about small business, content marketing, and legal issues, among many other topics. She earned an MFA in creative writing from the University of Montana and has a background in journalism and publishing. She lives in Missoula, Montana with her husband and two daughters.

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