The influx in cargo theft, cybersecurity concerns and ever-changing industry regulations continue to threaten the safety and security of tomorrow’s supply chains.
But, when it comes to the State of the Supply Chain, the implementation of technology mixed with the ability to be flexible, nimble and versatile will enable the logistics world to pivot accordingly.
Marina Mayer, editor-in-chief of Food Logistics and Supply & Demand Chain Executive, talks exclusively with Tom Madrecki, VP, supply chain, Consumer Brands Association (CBA) and frequent panelist on SCN Summit, details why the top supply chain challenge isn’t anything specific, but the sheer volume and variety of those challenges, all at the same time.
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Food Logistics: From your perspective, what are considered the Top 5 trends to watch in 2024? And why?
Tom Madrecki: When “normal” is anything but that. Geopolitical turmoil, calamitous climate events, unforeseen challenges, changing consumer demands — this is the new normal, and that’s no longer shocking. But now more than ever, supply chain executives must be developing the resiliency and reflexes to respond to anything.
Doing more with less. Cost pressures, continued organizational transformation, new technology and persistent labor skills gaps are driving companies to consider how to retool and reorganize supply chains. Can supply chains power exponential growth with half the staff? We’re about to find out.
Realizing the possible. New technologies like AI and automation are the talk of the town, but we’re only beginning to realize what is possible through their implementation. It’s not just the technology that will be innovative – it is the application and new ways of thinking that will change the game.
Policy – friend or foe? As supply chains rebound from the pandemic and subsequent disruptions while trying to navigate tumultuous events and potential recessionary dynamics in the economy, the last thing executives need are policy roadblocks or challenges that lead to further rising costs. But that’s just what issues like potential new tariffs on tin mill steel could do unless the Biden administration changes course. The potential for policy to make a positive impact remains — programs like the Department of Transportation’s FLOW initiative or legislation that could establish an office of supply chain at the Department of Commerce demonstrate that there’s still some good left in Washington.
Visibility as a force for good. Recent years have seen the emergence of visibility platforms, highlighting their ability to foster greater efficiencies, enhance information sharing and (hopefully) lower costs. But visibility has another role to play in enhancing traceability and transparency efforts. There’s huge upside in potentially reducing Tier 2 and 3 emissions (which could comprise up to 80% of total carbon for CPG companies) and similar benefits in terms of ensuring supply chains are free of forced or child labor, among other noble goals.
Food Logistics: Describe some of the challenges impacting many of today’s supply chains.
Madrecki: There’s never a dull moment — the top challenge isn’t any specific one, but the sheer volume and variety of those challenges, all at the same time. And that constancy of change and challenge is what’s accelerating the need for new technology, operational and product development solutions.
Food Logistics: Describe the State of Transportation, and how factors such as union strikes, driver shortage, etc. will affect the State of Transportation in 2024.
Madrecki: Shipper costs and performance levels are certainly in a better place than peak pandemic panic, but we aren’t out of the woods just yet. The underlying issues in terms of labor scarcity remain, as do issues like sagging rail performance and lack of efficiency at ports relative to international peers. “Chugging along” might be the most succinct descriptor.
Food Logistics: Describe the State of E-Commerce, and how the B2B and B2C channels in cold chain have thrived/declined since the onset of COVID.
Madrecki: Demand for new channels and products remains strong, in many cases necessitating cold chain services and other solutions to ensure product availability and delivery. The broad theme here is added modal complexity and increasing levels of complexity overall across supply chain distribution patterns. That’s a bigger, arguably more impactful philosophical shift that supply chain executives will be forced to reckon with.
Food Logistics: Describe the State of Software and Technology, and how AI, robotics and more are shaping the future of the cold food chain.
Madrecki: See trend comment above – it’s not just the technology itself, but how supply chain executives will deploy and utilize that technology. There’s a whole world of possibility out there but will require big ideas and creativity to use these new tools effectively.
Food Logistics: Describe the State of Sustainability, and what’s in store for supply chains come 2024 with certain ESG regulations coming down the pipeline.
Madrecki: Coming out of the pandemic, supply chain executives should expect focus to return to net zero commitments and targets, driven by both government policy as well as internal corporate goal setting. Visibility tools may offer a key unlock in that regard, providing greater understanding on how to move the needle and where opportunities exist to make inroads toward those metrics.
Food Logistics: Looking back at the past 2-3 years, how has the cold food chain progressed? Declined? What’s in store come 2024?
Madrecki: Not just for cold chain, but across the board for consumer packaged goods, the last several years have provided a platform for rapid change — but also, limited opportunity to step back and assess the strategic landscape. We are hardly in a lull amid current turmoil and persistently high commodity costs, but now is a better time than any other in recent history to work through big ideas and pivot for the future.
Food Logistics: What are some things not addressed above that may be pertinent to our readers?
Madrecki: The increasing complexity of supply chains and the elevated role of supply chain leaders within the C-suite necessitate a more comprehensive and nuanced understanding of how to drive change and deliver results. Supply chain leaders today must not only be “old school” supply chain experts to drive operational efficiencies and results, but embed themselves within the enterprise, understanding that product development, sales, go-to-market strategy and other facets of the business are just as much “supply chain” as anything in their stock job description.
CLICK HERE to read the article in full.
