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The benefits of automation in the supply chain

From managing data, contracts and payments to tracking products, here's how automation is revolutionizing supply chains.

Emerging competition and heightened customer demand to deliver products faster have triggered an evolution within supply chains.

One way companies can address this problem is through the use of automation tools, which aim to alleviate some of the easier, repetitive tasks for employees. As top business leaders have pointed out, automation in the supply chain is not only useful, but necessary.

“Automation both accelerates the supply chain and eliminates human error. Plus, automation systems are already on the market and can even connect [to] your existing systems,” says Peter Drakeley, Head of Global Success at EazyStock. 

Manav Garg, CEO and Founder of Eka Software, echoes this sentiment, noting that “automated data informing business processes in real-time must be part of any business dealing with supply chain management.”

In fact, a World Economic Forum study predicts that by 2022, 27% of decision making in the supply chain will be automated. Let’s explore how businesses can use automation in their supply chain to solve their various challenges, like streamlining operations, error reduction, customer service and employee satisfaction. 

How automation helps companies

Supply chains contain a full spectrum of moving parts, many of which are mundane or error-prone, or worse yet, forgotten altogether. Automation looks to assist with these types of tasks, from handling tedious logistical processes to compiling analytics and communications.

Tracking products

Many companies have added automated tools to the tracking process within the supply chain, which helps to enhance current practices, and allows employees to focus on more complicated tasks, like specialized orders. 

Telecom manufacturer Infinera began using automation tools to provide better predictions on delivery dates. Their automation and data tools reviewed past deliveries, along with weather reports and customer feedback to create a cohesive, accurate estimate of when a product will arrive. The end result is more satisfied customers and a company able to make faster-qualified decisions.

Processing payments

Within a finance department, automation is speeding up tasks, which in turn helps with receiving payments quickly. Automation tools can send out invoices and track whether or not they’ve been paid. And online portals offer businesses and their clients greater transparency into the process from start to finish.

Managing data

All supply chain processes produce data, which needs to be collected and properly analyzed in order to improve practices. Automation tools can help to assemble data and categorize it for future use. Data is the new currency in today’s market and is necessary for growth and improvement.

IKEA not only effectively tracks orders, but the organization also collects the data from these shipments. When employees know how long it takes an item to be built or how a problem occurred, it leads to better supply chain practices as well as better customer and retail relationships. 

 

In addition to the abilities listed above, automation can help businesses with other tasks, like: 

  • Optimizing employee efforts: Because smaller tasks are handled by automation, employees can focus on higher-level work. Plus, partnering humans and digital workers leads to more productivity and efficiency. 
  • Reducing opportunities for mistakes: Companies that pair humans with automation have the chance to cut down on missteps. Depending on the setup, organizations can have both types of “employees” checking each other’s work or incoming requests. By working together, companies see fewer chances of an order being mixed up or forgotten.

 

Although some companies are hesitant to bring in fully automated systems into their supply chains, there will still be the need for humans to supervise and manage automated processes. As Harvard Business Review points out, new jobs will be created from this change. Bringing together machines and humans can help improve warehouses and supply chains.

The future of supply chains

As businesses continue to evolve to meet the demand for faster consumer delivery, automation within supply chains will progress as well. Tools that track product delivery, process payments and manage data are all speeding up daily tasks while providing additional insights. Automation allows employees to work on simplifying procedures, and at the same time helps to decrease mistakes.

 

Contributor: Amanda Peterson

Located in New York City, Amanda Peterson is a software engineer and regular contributor to Enlightened Digital

Written by Catalytic