Supply Chain Services Quadrant Report - October 2023

Published on 19 Apr 2024

In the dynamic landscape of supply chain services, enterprises are navigating macroeconomic uncertainties and inflationary pressures, seeking partners who can transform supply chains into both value-creation levers and cost-efficient entities. A pivotal aspect of this transformation lies in the integration of digitally capable supply chain services supported by a consulting-led approach. According to the report authored by Tarun Vaid, over a third of digital and connected supply chain services are outsourced globally, with U.S. enterprises commanding nearly 50 percent of the market share.

Leading service providers are strategically investing in in-house intellectual properties (IPs) and accelerators to drive innovation and meet evolving customer demands. Over the next few years, supply chains are poised to witness a significant digital transformation, with increased automation and multi-enterprise ecosystem-level digitization. Machine learning (ML) applications will play a pivotal role in interpreting demand signals and optimizing inventory control, thereby ensuring seamless business continuity.

Digital Transformation of the Supply Chain

A significant uptake of digital technologies like analytics, automation, AI, and IoT is driving the digital transformation of supply chain operations for enterprise clients. Providers are offering multiyear, integrated digital transformation roadmaps to accelerate performance, agility, and resilience, catering to short-term improvements and strategic long-term visions.

Intelligent Supply Chain

Enterprise clients are prioritizing data analytics and intelligence to optimize supply chain operations. Advanced analytics and predictive modeling are being used to gain actionable insights, and optimize demand forecasting, inventory management, and supply chain planning. Data-driven decision-making is becoming crucial for efficiency and effectiveness.

Digital Thread is Now Mainstream

Digital thread fosters connectivity, transparency, and communication among supply chain operators, ensuring responsiveness and adaptability to disruptions. Technologies like IoT, ML, and digital twins unify data, empower agile decision-making, and resolve issues proactively, resulting in reduced waste and higher revenue.

Supply Chain Risk Management

Clients are investing in risk management strategies to mitigate disruptions and create robust supply chain networks. Technologies such as predictive analytics and scenario planning are adopted to proactively identify and mitigate potential hazards. Robust governance, controls, compliance, and constant risk monitoring are crucial amidst geopolitical uncertainties and regulatory challenges.

As the supply chain landscape continues to evolve, generative AI and sustainability-focused supply chain services are anticipated to gain significance, with projects transitioning from planning to proof-of-concept phases. This space has witnessed a substantial increase in investment, indicating a growing commitment to sustainable and resilient supply chains.