Next-Generation Innovations: Digital, On Demand, Always On

Manufacturing and supply chain professionals face many challenges but, according to the 2018 MHI Annual Industry Report, Overcoming Barriers to NextGen Supply Chain Adoption, the top ones are increasing customer demands on supply chains (73 percent) and hiring qualified workers (64 percent).

Eleven technologies are working together to create next-generation supply chains that can meet these challenges because they are digital, on demand, and always on. Eight out of 10 survey respondents say they believe these supply chains will be the predominant model within just five years.

The top technologies respondents say can be a source of either disruption or competitive advantage are:

• Robotics and automation (65 percent, up from 61 percent in 2017)

• Predictive analytics (62 percent, up from 57 percent in 2017)
• The Internet of Things (IoT) (59 percent, up from 55 percent in 2017)
• Artificial intelligence (53 percent, new category in 2018)

• Driverless vehicles and drones (52 percent, up from 30 percent in 2015)

In terms of adoption rates, cloud computing and storage leads with 57 percent, and is tracking to grow to 91 percent over the next five years. Inventory and network optimization, now at 44-percent adoption, is expected to grow to 90 percent over the next five years (see chart).

Over the same time frame, predictive analytics is expected to reach an 82-percent adoption rate, followed by IoT at 79 percent, robotics and automation at 73 percent, blockchain at 54 percent, driverless vehicles and drones at 50 percent, and artificial intelligence at 47 percent.

Top 3 Barriers to Adoption of Disruptive Technologies

1. Making the business case for NextGen supply chain investments.
2. Tackling the supply chain skills gap and workforce shortage.
3. Building trust and security in digital, always-on supply chains.