Supply Chain Management Activity Surges as Summer Comes to An End

As September approaches, here’s a roundup of some of the month’s more significant supply chain management developments.

Purpose driven. As enterprises move from operating profit-centric to purpose-driven, chief supply chain officers (CSCOs) must focus on five actions to create a purpose-driven supply chain, according to Gartner, Inc. “Purpose-driven enterprises deliver benefits for stakeholders while also generating long-term profits,” says Sarah Watt, senior director analyst with the Gartner Supply Chain practice. “With this approach, supply chain leaders must consider their positive and negative impact across stakeholder groups and balance the trade-offs.” A global Gartner survey of 573 practitioners in supply chains and other functions conducted in January and February 2021 found that 85% of supply chain leaders believed that the primary priority of enterprise purpose is to connect the customer through product offerings while providing a positive societal and environmental impact – this is followed by an investor return at 61%. Analysts conclude that all decisions made about products, their purpose and subsequent market positioning has an impact on logistics management – which must deliver on given promises.

Rail concerns. Navis recently released the results of a survey showing automation and integration of systems are top priorities within the rail industry, which is seeking new productivity gains. According to the poll of rail industry executives from both mid-size and large global railroad companies, 60% of respondents plan to invest in automation, 58% in enterprise-wide planning and operational systems and 43% in artificial intelligence and machine learning over the next three years. Sixty-two percent of respondents believe that railways need to automate trains and yards within the next six years to stay competitive with alternative modes of transportation. In addition, 90% believe that AI and machine learning will be an important component to improving rail operations in the same time frame.

Risk revealed. According to data released by Resilinc, human-caused supply chain disruptions are rising overall, with the amount of factory fires up 150% (when comparing the first half of 2021 to the first half of 2020). This year is on track to have the most factory fires ever reported. The uptick is due mostly to gaps in regulatory and process execution as well as a shortage of skilled labor in warehouses. The data also reveals that disruptions due to Supply Shortages (semiconductor chips, plastics, cardboard are all examples) were up 638% in the first half of 2021. Resilinc sent out 251 Supply Shortage alerts; this type of disruption ranked 6th in terms of most reported events. Supply Shortages are driving consolidations, mergers, and business sales as companies look to give a quick cash boost to the core business or optimize the supply chain to best serve the customer base.

Vax enablers. Littler, a global labor law practice representing management, has released the results of its “COVID-19 Vaccine Employer Survey Report: Delta Variant Update completed by 1,630 in-house lawyers, C-suite executives and human resources professionals across the United States. While most employers surveyed are still encouraging, rather than requiring, vaccinations, the data shows an increasing openness to such mandates amid rising infection and transmission rates. The survey also explores how employers are shifting their policies for incentivizing vaccination, return-to-office timing and mask wearing, among other pressing issues. While the majority of employers surveyed (63 percent) are encouraging, but not requiring, vaccination, the calculus may be shifting given the rapid spread of the highly contagious delta variant and the universal accessibility of vaccines for U.S. adults. Nearly half of respondents (46 percent) say they are more strongly considering a vaccine mandate in light of the recent rise in COVID-19 cases.

Digging drones. According to Coherent Market Insights, the global delivery drones market was valued at $497.5 million in 2021 and is expected to exhibit a CAGR of 41.3% during the forecast period (2021-2028). The growth of the global delivery drones market is largely attributed to the increasing focus of private as well as public organizations on partnerships and collaboration for the adoption of delivery drones services. North America held a dominant position in the global delivery drones market in 2020 and is expected to retain its dominance throughout the forecast period due to the presence of several key players such as Amazon, UPS, Google, and DHL are offering drone delivery in inaccessible areas in the North America region, which has led to an increase in demand for delivery drones. Major players operating in the global delivery drones market include: Airbus SE, Deutsche Post DHL Group, Drones America, EHang, JD.com, Matternet Inc. and The Boeing Company.

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