3 Ways to Improve Supply Chain with Automation in 2024

The Covid-19 pandemic helped organizations to identify various weaknesses in their supply chains. Supply chain networks are rife with repeatable, process-oriented, and error-prone tasks, ranging from manual documentation errors to picking and stocking errors, shipping and receiving errors, and much more. In the post-pandemic world, supply chain leaders are making more efforts toward eliminating these weaknesses and improving their supply chain operations. 

Automation is an effective way of enhancing existing supply chain processes and introducing new ones. AI and other automation technologies are on the list of the top disruptive technologies that will impact supply chains by 2025 (Figure 1). that Gartner expects supply chain autonomy in 10+ years with hyperautomation initiatives in the supply chain. As a result, organizations need to focus more on automating their operations to overcome the weaknesses in their supply chains and remain competitive.

This article explains 3 areas of supply chain automation to guide organizations toward supply chain resilience and autonomy.

Figure 1. Top disruptive technologies impacting supply chains of the future

1. Warehouse automation 

McKinsey states that even though distribution centers are improving warehouse job attractiveness, employing and retaining warehouse workers is still difficult. Reports also suggest that pandemic significantly impacted the labor supply in the warehousing industry and suggest that this shortage will continue during 2022.

Warehouse automation can help supply chain leaders overcome the shortage issue. Furthermore, warehouse operations include repetitive tasks such as inventory management, supply chain tracking, and doing high-risk tasks, such as operating heavy equipment. Automating such tasks can enable companies to achieve more productivity, worker safety, sustainability, and lower costs.

Even though many businesses (80%) have still not implemented warehouse automation in any way, studies suggest that the warehouse automation market size will double to $30 billion by 2026 (Figure 2).

Figure 2. Global warehouse automation market size from 2012 to 2026

In 2022, warehouse automation will be a prominent trend in the supply chain and logistics industry; therefore, leaders need to consider it an essential element for a sustainable warehousing future.

Warehouse Automation Examples

1. Supply chain tracking

Supply chain tracking refers to ensuring that your shipments are both sent and received on-time. On the supply side of the equation, shipping your customers’ orders out as soon as possible increases their loyalty and satisfaction. And on the production side of the equation, the timely receiving of intermediary goods will ensure an uninterrupted and on-schedule manufacturing process.

2. Demand/Supply planning & Inventory automation

New sophisticated technologies like Woodman’s badger robots and AI-powered demand forecasting solutions help supply chain leaders automate their inventory operations to minimize the occurrence of out-of-stock or overstock situations.

3. Automated guided vehicles (AGVs) / Autonomous mobile robots (AMR)

AMRs add intelligence, guidance, and sensory awareness to conventional AGVs. This allows them to operate autonomously and collaboratively around humans. AMRs address the limitations of traditional AGVs and make them better suited to complex warehouses and collaborative activities. 

Watch how Ocado, a UK-based technology company, revolutionizes the grocery sector through its warehousing automation systems.

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Read how UCBOS helped a company from the hospitality sector automate its asset management processes.

2. Back-office automation 

Back-office tasks can significantly benefit from automation. For example, supply chain management processes contain various documents such as delivery orders, dock receipts, bills of lading (B/L), and sea waybills. Employees in the supply chain department continuously store and process these documents for various reasons, yet, this is a time-consuming, manual task that inhibits businesses from reaching operational excellence. 

Using artificial intelligence (AI) and optical character recognition (OCR), businesses can achieve nearly end-to-end document automation (involving tasks like data capture, understanding information on the document, and sending the document to the relevant person).

Robotic process automation (RPA) can also be used to improve supply chain back-office tasks. According to a survey done on organizations from around the world, 44% of the participants expect RPA to have a significant or moderate impact on supply chains by 2023. They also stated that a careful implementation of RPA can have significant and positive effects on supply chain productivity and efficiency. Therefore, supply chain leaders need to start focusing more on implementing RPA in their supply chain back-office operations.

See how DHL leverages RPA to improve its back-office tasks

3. Transport automation 

Road transportation is the most used mode of logistics in the world. Almost all the products in your kitchen cabinet are brought through road logistics. Currently, the road transport industry is facing a shortage of truck drivers, and predictions indicate that this shortage will worsen in the future. 

Transport automation is a way out of this truck driver shortage crisis. More supply chain leaders are focusing on this solution and investing in transport automation solutions. The autonomous vehicle market is projected to rise from $1.6 billion in 2021 to $11 billion by 2028. Autonomous things such as autonomous trucks and drones can be used to transport supplies in the network. 

Transport automation examples

1. Amazon

Amazon is making substantial investments in autonomous self-driving truck systems and trucks to get ahead of the curve and overcome the driver shortage issue.

2. Tusimple

Tusimple, an American trucking company, has completed 550 miles of driverless trucking and pans to expand its business by 2023. 

3. DHL

Since drone technology enables faster, low-cost, and no-human contact delivery, it is gaining momentum in the post-pandemic last-mile delivery sector. While many unrealistic pilots of drone technology can be seen in last-mile delivery, DHL’S Parcelcopter is ready to successfully mainstream drone technology in last-mile delivery.

4. Nuro

Nuro is a startup building autonomous self-driving delivery vehicles. Nuro is designed for the last-mile delivery of groceries, food, consumer products, and packages. Their custom-designed R2 vehicles don’t have passenger seats; instead, they are optimized for deliveries and safety, which means they’re small, narrow, use electric motors, and have pedestrian-protecting features.

Investing in self-driving trucks can give you a competitive advantage in the logistics and supply chain industry. 

Watch the video below to see how self-driving trucks are revolutionizing the logistics industry by providing cost-effective, fuel-efficient, and sustainable logistics solutions.

Further Reading on automation:

• IT Process Automation (ITPA): What it is & How it works
• AP Automation: The first finance process to automate
• AI in Automation: Discover tasks to automate with AI

You can check our comprehensive and data-driven lists of supply chain software and suites. And if you still have more questions on supply chain automation, don’t hesitate to contact us: