GSU Supply Chain Expert Foretells Leaps in Logistics Technology
Alongside COVID-19, another major news story of the last year focused on the triumphs and trials of the worldwide supply chain.
From record-breaking Amazon delivery rates to March’s massive hold-up in the Suez Canal, the logistics industry finds itself front and center in discussions about the future of commerce in a complex and changing marketplace.
Most recently, Amazon engaged the supply chain to send ICU ventilators to India to aid relief efforts in the country devastated by COVID-19. Governors State Supply Chain Professor and Supply Chain Innovation Center and Business Incubator Tricia Kerns says this is a key function of the supply chain— meeting demands.
“Supply Chain Management ultimately plans, produces stock in warehouses and is distributed to meet demand,” Kerns said. “This includes food, medicine, and anything else that may arrive to your doorstep or is purchased from a brick and mortar store.”
At Governors State University’s Supply Chain Innovation Center and Business Incubator (SCICBI), Executive Director Reggie Greenwood said the pandemic hastened several logistics innovations that are revolutionizing the way products move along the supply chain.
“COVID pushed these new technologies three years ahead of time,” Greenwood said. “All these innovations were already happening, but now are ramping up much faster.”
With a specific focus on the business-to-business supply chain, Greenwood shared the ways technology is quickly changing the landscape.
B2B business development in a virtual world
When health departments instituted COVID-19 restrictions in April 2020, Greenwood said the move all but obliterated the most common method of business development— trade shows.
“Companies had to reconfigure how they do business development,” Greenwood said. “What happened in this retooling is a huge expansion in methodologies behind virtual sales. There is an entire universe of sophisticated manufacturing companies going all-in on virtual sales.”
Lacking classic in-person forums to demonstrate products and processes, companies are finding new ways to collaborate virtually. Greenwood said the SCICBI has an opportunity to help local companies create the capacity to execute virtual business development on an ongoing basis.
Meanwhile, as companies reflect on recent productivity gains generated by virtual business development, Greenwood said there’s no going back.
“Companies find this to be productive, just as the rest of us have in our personal lives,” he said. “Now that businesses see the benefits, it’s not just going to jump back the way it was.”
B2B fulfillment sees 3D printing, track-and-trace tech
The newest technologies may also provide a more competitive playing field within B2B fulfillment, Greenwood said. Even small companies have a huge advantage if they can leverage technologies such as 3D printing and track-and-trace software.
3D printing allows companies to fulfill multiple complex orders without needing to maintain extensive on-hand inventory. For example, Greenwood said, after Hazel Crest-based crane manufacturer Mi-Jack Products sells a crane, they provide the customer with parts to service the machine throughout its lifetime.
“That company has to maintain a huge inventory of parts,” he said. “Consider instead if they could use 3D printing to simply print the part that the customer needs, and ship it to them.”
Track-and-trace technology represents one of the most significant shifts in supply chain management, Greenwood said. Companies use track-and-trace software and hardware to virtually follow a product as it moves from its point of origin to destination.
“We’ve all gotten used to ordering on Amazon and being able to look on the app to know exactly when the product is coming,” Greenwood said. “Companies need the same capability, but it’s more complicated because they’re ordering numerous products.”
Accurate track-and-trace systems help businesses organize production capacity. The data they provide will allow companies to pinpoint product availability and plan for optimal efficiency in their factory or warehouse.
“One of the hippest companies we’re working with is Project 44 in Chicago. They’re almost a unicorn in the industry,” Greenwood said.
Project 44 created a software package that allows a company to track the real-time location of its shipment, as GPS data are constantly being transmitted from an app on the truck driver’s phone.
Equity, sustainability rise to prominence
It’s no longer sufficient for a company to offer its B2B partners the cheapest price or fastest shipping times. Greenwood said the last year saw a major surge in demands from large companies that their vendors prioritize environmental sustainability and racial equity.
Companies have to prove their supply chain involves sustainable sources and fair treatment of workers along the way. They must show diversity in their purchasing and service contracts, as well as among their own staff members and boards of directors.
“There are many companies where this is required,” he said. “You can’t sell to them without meeting several substantial requirements.”