Is innovation the supply chain's best-kept secret?

The top 15% of companies, distinguished by their innovation in supply chain management, generate an average of 11% more revenue than their more traditional counterparts. This phenomenon is known as the ‘innovator advantage.’ Let’s explore what defines an innovative supply chain and uncover actionable insights to inspire your operations.

A study by the IBM Institute for Business Value sheds light on this concept, while also outlining the critical challenges faced by supply chains and their Chief Supply Chain Officers (CSCOs).

The study identifies three primary concerns for CSCOs, reflecting a period of profound change:

• Supply chain disruptions (51%)
• Technology infrastructure limitations (44%)
• Sustainability pressures (42%)

In this climate—marked by emerging technologies, ecological imperatives, and economic instability—CSCOs have three main priorities:

• Delivering an enhanced customer experience (52%)
• Boosting efficiency and profitability (49%)
• Improving forecasting accuracy (47%)

To address these challenges, supply chains are undergoing significant transformations, investing heavily in technology. Among the most prioritised innovations are artificial intelligence (54%), hybrid cloud systems, and the Internet of Things (IoT) (both at 49%).

But innovators—comprising 20% of CSCOs—are setting the pace by adopting cutting-edge technologies and data-driven strategies. Let’s delve into their winning practices.

Although the overall goals of innovators align with those of most CSCOs, their competitive edge lies in their data-driven approach.

In an automated warehouse, data is omnipresent. When leveraged effectively, it offers crucial insights that guide strategic decision-making

So, what types of data are innovators capturing? Here are three examples:

• Picking station and order preparation data: metrics like average processing time and error rates.
• Sustainability metrics: energy consumption of buildings and equipment, as well as the carbon footprint of packaging.
• Reverse logistics data: time spent managing returns and associated operations.

By harnessing this data-centric approach, innovators focus on four key areas:

• AI-assisted workflows to streamline operations.
• Hybrid cloud infrastructure to ensure scalability and flexibility.
• Transparency to meet consumer demands for sustainability.
• Cybersecurity, a vital defence against growing threats.

This unified approach enables innovators to simultaneously improve performance, customer satisfaction, and resilience to disruptions. Their efforts result in 11% more growth compared to the rest of the industry.

So, what are the must-watch technologies for innovation in the warehouse? According to IBM, machine learning and deep learning stand out as transformative tools for warehouse automation.

These technologies are integral to solutions like the Skypod logistics warehouse automation system. Powered by autonomous mobile robots (AMRs), the system optimises picking efficiency by adapting to a wide variety of product formats and materials. Additionally, a Warehouse Execution System (WES) ensures real-time visibility and control of warehouse operations, enabling high-density storage and seamless workflows.
By integrating such advanced solutions, your warehouse can embrace innovation and gain the innovator advantage.

Curious to learn more? Discover how the Skypod automated warehouse solution can revolutionise your logistics operations.