Optimizing the Manufacturing Supply Chain With 7 Tech-Forward Solutions
Every manufacturing operation needs an efficient and resilient supply chain. Stock shortages, shipping delays and similar disruptions can prolong production, raise costs and impact customer satisfaction, so manufacturers must prevent them as much as possible.
However, addressing these issues is often easier said than done. Most supply chains today are inherently prone to disruption, and conventional tools and methods are insufficient to prevent or mitigate it. The solution lies in embracing new technologies.
Here are seven tech-forward solutions manufacturers can use to optimize their supply chains.
Digital twins are one of the most beneficial technologies for manufacturing supply chains. These are virtual representations of real-world objects, facilities or processes that can update in real-time. Whether organizations use them to simulate entire supply chains or individual factories, they can reveal crucial insights, like highlighting bottlenecks or risky dependencies.
A digital twin of a global supply chain can simulate various changes to reveal which adjustment will likely yield the best results. More than half of all manufacturers are increasing their supplier base to boost resiliency, but doing so can be complicated. Simulating each supplier change in a digital twin could reveal which mix of specific vendors would yield the best cost and resilience improvements, highlighting the best path forward.
Applying this technology on a smaller scale helps, too. Manufacturers could use digital twins of factories to reveal production bottlenecks and simulate changes to find the optimal way to boost efficiency, mitigating backlogs and demand shifts.
As manufacturers use digital twins to optimize current processes, they can use artificial intelligence (AI) to prepare for future changes. Manufacturing supply chains must be able to adapt to shifting demand, supplier issues, delays and other disruptions, and AI forecasting provides the necessary insight to do so.
Predictive analytics tools use AI to analyze current and past data to understand trends and make predictions about similar situations in the future. Because AI can consider more data points and find patterns faster and more accurately than humans, it can provide more reliable insights. That could apply to demand cycles, weather events, supply shortages or virtually anything else.
If manufacturers can reliably predict these shifts, they can adapt ahead of time to minimize their impact. That could look like changing to closer suppliers if the current historical deficit of truck drivers worsens to shorten transport times or changing part orders before demands shift to prevent surpluses and shortages.
Warehouse Management Systems
Warehouse management systems (WMS) are another technology with significant potential for supply chain optimization. These platforms compile data from across a warehouse’s operations into a single point of access and control, making it easier to run these facilities effectively.
Warehouses are just one part of the logistics network but a crucial one, especially considering how many feature inefficiencies. With a WMS, managers can see where these inefficiencies lie and how to address them.
Real-time inventory data can reveal the most-picked items and their locations. Managers can then know how to reorganize their storage to place these shelves closer to loading bays. Because walking can account for more than 50% of picking time, this simple change could yield considerable benefits, and it’s just a sample of what WMS enables.
Cloud-Based Management Platforms
Similarly, manufacturers can use cloud-based supply chain management software to improve visibility and communication on a larger scale. Like a WMS, these platforms pull all relevant information into one place, facilitating more informed decisions and easier collaboration across the supply chain.
Supply chains are growing increasingly complex, as 60% of organizations today work with more than 1,000 third parties. Conventional communication methods are too inefficient to keep all of these parties up-to-date on all impactful events. Because cloud management platforms offer remote accessibility to real-time data, they can keep everyone informed at all times, enabling more cohesive action.
When manufacturers can see data from every upstream and downstream operation in one place, it’s also easier to see potential issues as they arise. They can then adapt as necessary to mitigate the impact.
More granular improvements are also necessary to optimize manufacturing supply chains. One of the best specific technology use cases for these operations is tracking vehicle fleets through telematics.
Telematics solutions track factors like driver behavior, truck locations and maintenance data and send it in real-time to operations centers. This visibility helps fleet managers see where and how to improve. It also enables faster responses to disruptions like traffic jams or failing refrigerated trailer equipment so manufacturers can avoid delays and losses in transit.
Telematics data can reveal if drivers are taking inefficient routes or speeding, leading to higher fuel consumption. Fleet managers can correct this behavior to lower one of the biggest portions of their budget and improve delivery efficiency. These logistics improvements translate into savings for downstream manufacturers.
Automated Quality Control
Quality control is another area where many manufacturing supply chains fall short. Inefficient or inaccurate quality checks can delay shipments or lead to waste downstream as manufacturers discover defective parts too late. Automation is the best solution.
Machine vision can detect flaws that human eyes may not see and do so far faster. Because machines don’t get tired or distracted, automation also delivers the same accuracy throughout the workday, which humans can’t do. Consequently, automating quality control makes it faster, more precise and more reliable.
Some factories have achieved near-zero failure rates while inspecting thousands of products per minute with machine vision quality control. As this technology has advanced since then, it’s only become more reliable and versatile. As such, it’s an essential step in minimizing supply chain-disrupting delays and defects for upstream manufacturers.
Blockchain Tracking Solutions
Blockchain is another one of the most promising technologies for optimizing manufacturing supply chains. Blockchains — most famous as the underlying technology behind cryptocurrency — are digital ledgers that run on distributed networks of computers. Each record in these ledgers is transparent to all users but virtually impossible to change, making blockchain an ideal tracking technology.
Manufacturers can use blockchain solutions to track parts or products as they move throughout the supply chain. Each destination scan or other update creates a new block in the chain, providing real-time, immutable evidence of the shipment’s origin, journey and current status. This transparency and security improve response times and fight fraud within the supply chain.
Organizations lose 5% of their revenue to fraud each year, and complex, low-visibility supply chains make that fraud easier. Because blockchains update in real-time and offer unchangeable records, they make it much easier to spot and stop this activity. Manufacturers can then avoid these losses and manage their suppliers more effectively.
Technology Is the Key to Supply Chain Optimization
Manufacturers must optimize their supply chains. To do that, they must embrace new technologies. Failure to do so will make it increasingly difficult to remain competitive in today’s market.
These seven solutions are just a few ways manufacturers can capitalize on modern technology, but they’re some of the most effective. Manufacturers should start with this list, review how each strategy could apply to their specific operations and implement these technologies accordingly.
These steps may incur some initial disruption and expenses, but the long-term results more than compensate for it.
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