Improving supply chain visibility and trust: The impact of digitalisation in logistics

Supply chain organisations are adopting innovative digital solutions facilitating real-time visibility and trust across networks. We forecast that there will be 700 million EoT-enabled devices by 2030 across supply chains.

Supply chains are increasingly central to the operations and competitiveness of businesses worldwide. With the impact of globalisation and advances in technology, supply chains have evolved from simple logistical networks to complex, interconnected systems spanning many countries.

Trends impacting the supply chain industry

There are several key trends shaping the priorities of the logistics and supply chain industry:

• Global disruption and supply chain resilience: Events such as pandemics (Covid-19), geopolitical tensions (Russia-Ukraine War), natural disasters and trade disputes have underscored the importance of more resilient and agile supply chains. Businesses are looking to prioritise risk management and ensuring adequate flexibility to adapt to disruptions including diversifying supplier bases, increasing inventory buffers, incorporating trusted IoT solutions and developing contingency plans.
• Digital transformation: Enhancement of current supply chain operations by leveraging new digital technologies such as IoT, blockchain and artificial intelligence (AI). For instance, blockchain can help create a secure and immutable record of every transaction, enabling a robust audit trail for supply chains and ensuring the integrity and traceability of transactions. Nearly 85% of supply chain leaders anticipate integrating AI and IoT technologies within the next five years, recognising the strong commitment to digital transformation.
• Sustainability and green logistics: Growing emphasis on environmental, social, and governance (ESG) considerations driven not only by regulatory requirements but also by evolving consumer preferences. For instance, in the UK, the government’s goal to achieve net-zero emissions by 2030 is driving increased pressure on supply chain organisations to act, particularly because supply chain functions account for 80-97% of a business’s overall Scope 3 emissions. Organisations must adopt eco-friendly practices, including ensuring visibility and reporting of carbon emission data throughout their supply chain to effectively identify strategies to mitigate their carbon footprint. Nearly 50% of supply chain companies have stated that they are facing increasing pressure to adopt a more sustainable supply chain approach in 2024.

Adding to these pressures, of course, is the constant need for logistics companies to provide faster and seamless experiences for their customers (e.g., next-day delivery moving to same day delivery) at a lower price point. They need to balance this with being more efficient and demonstrating a commitment towards carbon neutrality. One way to achieve these goals is to embrace supply chain digitalisation which is broadly defined as “the process of leveraging digital technologies to replace manual processes and streamline various aspects of supply chain management”.

Traditionally, supply chain approaches suffer from siloed data, fragmented systems, and limited transparency, leading to inefficiencies and increased costs. Supply chain digitalisation brings down those walls and can help transform future supply chains into an integrated ecosystem that is fully transparent to all the players involved. The below figure shows the transition to a fully transparent integrated supply chain ecosystem.

Transitioning to a fully transparent integrated supply chain ecosystem

Table of contents

• Executive summary
• Table of contents
• Introduction
  • Trends impacting the supply chain industry
• Supply chain industry must overcome challenges before full digitalisation
• Emerging technologies drive adoption
• Use cases revolve around enhancing end-to-end supply chain visibility and efficiency
  • Spare fleet capacity use case drives significant benefits for supply chain organisations
  • Future success fuelled by wider ecosystem collaboration
• Conclusion: The future vision of the industry
  • Recommendations
• A message from our sponsor

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Author

Henry Osborne

Consultant

Henry is a Consultant at STL Partners and brings with him a background in internal strategy in the Technology, Media and Telecommunications (TMT) industry. Since joining STL Partners, he has worked on a variety of topics including private networks, edge computing and B2B growth opportunities for operators.