There is a lot of talk on trends in technology for supply chain management. Curiosity got the better of me. I started reading, hearing, listening to, absorbing and trying to make sense of what experts meant by Blockchain, IoT (Internet of Things), Robotics, Big Data, Analytics, AI (Artificial Intelligence), Cloud Computing, Immersive Technologies (VR – Virtual Reality and AR – Augmented Reality), VPA or VCA (Virtual Personal or Customer Assistants), Chatbots and the seemingly endless list. A couple of weeks and at least a couple of dozen readings hence, I am still trying to make sense. Here is why.
In trying to make sense, I am actually trying to see the directly applicable relevance of these emerging trends to solving the real problems that actually ‘chain’ supply. Particularly the ones that chain our cities. And these, by and large, are global. They apply to developed economies as much as they do to developing and underdeveloped economies in appropriation. One of the very big of such problems is that of traffic congestion.
Enormous and ever-increasing traffic congestions are posing problems unimaginable across the world. In all modes of transport. Through loss of time, excess energy consumption, risk to property and life and of course, escalating costs, traffic congestions are actually chaining cities, supplies and economy. And this is quite a growing trend. A quick glance on the auto industry growth statistics alone is explanatory enough.
Recently this year, India overtook Germany as the fourth largest global automotive market, right behind China, the United States and Japan. The total vehicle sales, passenger and commercial vehicles included, in India during FY 2018 (Apr 2017 – Mar 2018) grew by 9.2 per cent with total sales of 4.02 million units. Growth in Germany was 2.19 per cent, with total sales accounting for 3.81 million units.
As for production, the Indian auto industry produced a total of over 29 million vehicles including passenger vehicles, commercial vehicles, three-wheelers, two-wheelers and quadricycle during the same period registering a production growth of 14.78 per cent.
What should be and indeed is a matter of pride from the sole perspective of industrial growth and economic progress is a matter of concern when clubbed with the perspective of transport infrastructure and supply chain efficiency.
The existing inadequacies in transport infrastructure lead to traffic congestion which are further aggravated by increase in car production and sales. Is rate of decongestion anywhere even half the rate of auto sales? Furthermore, poor quality of transport infrastructure creates bottlenecks and increases the probability of accidents leading to loss of property, risk to human life and escalating costs of damage recovery.
While there are policies being formed and executed, the time effectiveness of these policies often seems questionable. Little surprise then, that the industry keeps raising concerns on lack of clear, consistent and robust policies and implementation thereof. This underscores the importance of having a system of measurement correlating the investments made in technology for supply chain management or any process improvement initiative with the effectiveness of solutions being implemented. The result should not just show up in numbers but also in the permanent visible effects of a desired favourable change. Like for instance, if a system with Artificial Intelligence in providing traffic updates is to be implemented and integrated into supply chain management, then the effectiveness of such a system should be determined not just in reduction in total turnaround time but also in visible increase in the number of vehicles dispatched per unit of time. Increase in asset utilization and decrease in distribution costs are the two most relevant determinants of supply chain efficiency in this case.
Similarly, parameters for measuring efficiency should be developed in every area of supply chain management viz, Planning, Procurement, Inventory Control and Materials Cost Accounting. While technology will largely enable speedy computation and information exchanges, developing these parameters to effectively measure and manage efficiencies will require knowledge experts.
There are trends in technology, but in traffic too. The latter seem to be stripping the former of their effectiveness, thereby decelerating adoption. The trends in technology, therefore, have to be synched up with their direct relevance to solving real problems. And of course, this has to be at affordable costs. At the moment, there certainly seems to be a huge gap. Knowledge experts have a key role to play in bridging them and making technology trendy as well as tactful.