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Modern supply chains are evolving beyond anyone’s expectations due to increased use of cloud-computing technologies, wearables and advanced data analysis. In addition, the role of these technologies is becoming more than a means of guaranteeing profits; they are enabling more small businesses to compete with larger, big box retailers, which drives prices down for end users. A common theme of the 2016 predictions was growth and scalability, so let’s look at how companies are using these technologies as we prepare for the innovations of 2017.

Cloud-Computing Use Continues to Increase.

Cloud-computing technologies are primarily designed to enable rapid dissemination of information and access to software suites at a fraction of the costs of tradition systems, such as Oracle or SAP. Powered by an increasing number of connected devices via the Internet of Things, automated data entry is empowering usable data and allowing more companies to replace legacy systems or integrate new technologies with existing systems.

Meanwhile, cloud technology enables companies to expand infrastructure without significant investment or use of resources, reports AXIT of Supply Chain 24/7. In fact, up to 70 percent of companies surveyed in Europe have already implemented cloud-based solutions to enable rapid scalability and flexibility. Furthermore, larger companies are also realizing the cost savings possible through cloud technologies.

Another driving force behind the increased use of cloud technology in 2016 was budgets. More IT departments are being forced to work within smaller annual budgets, and most IT departments only account for 11 percent expenditures on new applications. Consequently, the need for a low-cost, high-return system is becoming more prevalent, and cloud technology can answer this call. Moreover, cloud technology enables global access to information, explains Ship Rocket, so companies can ensure continued uptime regardless of local events or issues.

Essentially, the cloud is working to reduce overall risk and reduce costs along the way, but it is also becoming key to increasing accountability and visibility throughout an organization. In other words, greater access to identical systems prevents organizational silos from inhibiting visibility, asserts Alex Whiteman of Eye For Transport.

Wearables Became More Cost-Effective and Available.

The Apple Watch, Fitbit and Google Glass have been major catalysts of efficiency and improving productivity, and other wearable technologies are continuing to drive the supply chain forward. While most of the conversation focuses on their applicability to picking processes or repairs, they can also have significant safety benefits, such as alerting managerial staff when employees are overexerting themselves, which can reduce costs associated with health care and benefits to employees.

For example, wearables measuring the number of steps, heart rate and calorie consumption can virtually eliminate on-the-job cardiac events, reports the Inventory & Supply Chain Optimization Blog.  Furthermore, the vastness of warehouses also means wearables may be used to identify medical emergencies and call for help if an incident occurs. In fact, wearables were recently highlighted for their benefits to employee health and safety by Boss Magazine. Unfortunately, full implementation of wearables in warehouses may mean greater Wi-Fi costs or connectivity access for devices that do not function on carrier radio waves.  The use of wearables will continue to be one of the top trends throughout the remainder of 2016 and upcoming years as well.

Simultaneously, wearables could help reduce trucking accidents by reducing fatigue, maintaining vehicle safety and security and improving driver performance, reports Christy Pettey of Gartner. Since the driver shortage only appears to be growing worse, keeping today’s drivers driving is essential to the success of the supply chain.

Data Analysis Grew Exponentially, Providing More End-to-End Visibility and Continuous Improvement.

Data analysis is the companion of cloud-computing technologies. The use of the cloud almost inherently implies co-occurring use of data analytics for integrated systems. Consequently, the focus on data analysis also grew significantly in 2016, and the use of beacons and connected devices, including POS systems, on-truck sensors and inventory management applications, will continue to shape how consumers obtain products from manufacturers and vendors. Think about the grocery stores that have implemented self-check-out registers.

While this idea seemed ground-breaking in 2006, it has become a commonplace aspect of nearly all Walmart locations. Unfortunately, these same POS systems are also enabling theft, reports ABC 10 News. Consequently, the retail giant is having to rethink how it reduces theft by making systems more accountable, which results in direct data analysis of consumer shopping patterns. This needed degree of visibility is also present in the supply chain. Per Steve Hitchings of Talking Logistics, supply chain visibility and business intelligence go hand in hand, and these technologies can practically stop a hemorrhaging cash flow. However, they also can stop problems with inventory management.

Retail sales are only showing increased ability to break previous records. Back-to-school sales were expected to be slightly more than in 2015, and the 2016 holiday shopping season broke all-time records. The ability of machines to learn more about today’s supply chain is essential to achieving greater visibility as the number of transactions and their values climb, reports Scott Dulman of Supply & Demand Chain Executive. More importantly, the concept of machine learning is empowering a new wave of analytics capabilities, allowing more retailers to respond to real-time data on what consumers need and want, reducing headaches and bottlenecks throughout the entire supply chain.

2016 Was a Year of Innovation and Determination.

Across global supply chains, the focus of 2016 was clear; make the supply chain more responsive, accountable, adaptable, accessible, flexible and based on technologies and innovation. Most of the trends or predictions listed earlier this year came true, and many were key in helping more companies survive the growing power of Amazon and big-box retailers. If you can use the technologies and trends identified in this series fully, or even begin the process of implementing them, in your organization, you will be able to stay competitive and keep your company afloat in the coming years. 

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