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The Top 10 Supply Chain Trends in 2022



Emily Newton is a technology and industrial journalist. She is also the Editor in Chief of Revolutionized.

The distributed, complex nature of global supply chains makes them inherently prone to disruption. Still, the far-reaching consequences of the COVID-19 pandemic and growing international tension have disrupted these networks more than usual. Some supply chain trends have entirely altered course in response.

Staying competitive in the industry often means staying abreast of these changes. Here are ten leading supply chain trends to expect this year.

1. Increased Automation

One of the most significant challenges facing supply chains in 2022 is the ongoing labor shortage. The trade and transport sector lost 3.6% of its workforce in September 2021 alone, the second-highest of any industry. While addressing this issue requires several actions, increased automation is the most straightforward.

Applying automation to repetitive, traditionally inefficient tasks like picking and material handling can produce impressive results. In addition to mitigating labor shortages, this will improve warehouse productivity, as robots are better at this type of work than humans. Those that automate faster could see success in 2022.

2. Relocation

Relocation will be another common theme throughout 2022. High international shipping rates and geopolitical tension will make reshoring and near-shoring more appealing. Similarly, carriers near a shipment’s point of origin can afford to offer lower rates because they can fill empty miles on their return with the shipment.

Organizations should review where their most disruptions, delays and costs occur and consider relocating those facilities. If possible, moving them closer to their shipments’ point of origin or intended destination could resolve these issues.

3. Diversification

A similar supply chain trend that will continue through 2022 is diversification. Widespread disruptions from region-specific shutdowns have proved how fragile hyper-lean supply chains can be. Sourcing from multiple locations and removing single dependencies can reduce those risks.

Some may embrace diversification all at once, while others can only afford to diversify in incremental movements, but both are better than remaining vulnerable. Organizations should determine their capacity for change and what they’re trying to protect and avoid to find the best path forward. Remember to consider critical partners’ capacity to diversify, as these changes will also affect them.

4. Due Diligence

The past few years have seen a rising emphasis on environmental, social and governance (ESG) issues. As part of that trend, due diligence will be increasingly important to supply chains in 2022. Organizations must ensure their products and materials are sustainably sourced and avoid possible human rights violations.

New legislation bans products made with forced labor in China, though how the government will enforce this remains unclear. When distancing supply chains from China isn’t an option, companies need to analyze their sources in depth to avoid violating this law. Similar actions should also apply to things that aren’t a matter of law, like sustainability and data exposure risk.

6. Visibility

Many of these supply chain trends rely on increasing visibility within the supply chain. Companies can’t hope to find ideal areas to diversify, perform due diligence or become more agile without a complete picture of their operations. As this need for visibility rises, so will technologies like the internet of things (IoT) and blockchain.

IoT connectivity can enable real-time analysis of inventory levels, transportation risks, shipment health, locations and more. Blockchains can then ensure secure, transparent delivery of this data, helping companies capitalize on it. Both may prove crucial in the move toward visibility.

7. Cybersecurity

As supply chains become increasingly reliant on digital data and technologies, cybersecurity has become essential. Supply chain cyberattacks rose by 430% in 2021, with 45% of organizations experiencing at least one attack. Cybersecurity must improve, or the industry’s rapid digitization will prove more dangerous than helpful.

Securing IoT devices through network segmentation and data encryption are among the most urgent actions. Some larger supply chains may need to implement more sophisticated controls, like continuous network monitoring and zero-trust architecture. Vetting third parties for cybersecurity risk will also be critical.

8. Sustainability

Another supply chain trend that will grow in 2022 is an emphasis on sustainability. Governments and consumers alike are taking environmental action more seriously, so companies must go green to meet their demands. Since transportation accounts for 29% of greenhouse gas emissions, much of that action falls to supply chains.

Electric trucks are starting to emerge, so embracing these may be an optimal step forward, though they may be best-suited for last-mile deliveries at first. More efficient route planning will also help reduce emissions. Supply chains should also hold their partners and third parties to a higher environmental standard.

9. Artificial Intelligence

Many of these supply chain trends rely on new tech, and artificial intelligence (AI) is one of the most helpful of these technologies. Most notably, AI can analyze data from IoT devices and other sources to inform more effective action. These predictions can help supply chains capitalize on their visibility for more resiliency and efficiency.

AI can also automate many repetitive or data-heavy tasks to let smaller workforces accomplish more in less time. Companies like Amazon and Staples have already adopted AI to power warehouse robotics to automate picking and packing more effectively. Since AI is expensive, businesses should look for inefficient and easily automatable tasks to apply this technology to first before expanding.

10. Legal Involvement

2022 will also see supply chain organizations taking a more active role in politics. International complications, out-of-control rates and other disruptions may require broader action than what individual companies can provide. Businesses may have to push for government solutions to these larger issues.

For example, the Federal Motor Carrier Safety Administration’s pilot program for younger truck drivers may help mitigate labor shortages by enabling younger people to drive long-haul trucks. Lobbying for similar changes in other areas, like commercial fairness in railways and shipment rate price-gouging, may be necessary.

The Supply Chain Industry Is Changing

Supply chains are on the verge of substantial change. While these supply chain trends will mean initial disruption, they’re only happening in response to current strategies’ weaknesses becoming clear. Without this disruption, these networks will continue to be fragile.

Pursuing these changes will help supply chains become more resilient, efficient and responsible. While the transition may prove difficult at first, organizations will emerge stronger than before.

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