Supply Chain Management Evolution and the Role of Expert Networks

Supply chain management ensures that production is affordable, consumers are satisfied, and shipments stay on schedule as the world becomes more interlinked and manufacturing resources are spread across the globe.

Over the past 20 to 30 years, globalization, shifts in buying habits, and technological advances have all had a significant impact on the development of supply chain management.

So, how has the supply chain evolved, and where does it currently stand?

What is supply chain management?

Supply chain management, or SCM, is the process of managing the flow of resources into and out of an organization. It encompasses all the steps related to converting raw materials and components into finished products and delivering these to the end user.

As of 2023, it has been estimated that the total value of the global supply chain management market has reached US$29.3 billion. By the end of the decade, experts forecast that the market will register growth, showing a compound annual growth rate (CAGR) of 10.4% with its value in 2030 expected to reach US$58.7 billion.

Brief statistics about supply chain management

• Logistics costs can account for as much as 20% of product pricing and range from 25% to 45% of total expenditure, depending on the nature of a company’s operations.
• There has been an increase in the use of drones for delivery. Over the next few years, the value of this market is expected to hit US$5.7 billion, showing a 36.7% CAGR. In 2024, it is estimated the market’s value will be US$472 million.
• Supply chains powered by artificial intelligence (AI) have proven to be 67% more efficient compared to those that do not make use of this technology. This is mainly driven by lower overall costs and reduced risks.
• According to 48% of businesses, there is growing pressure on them to improve supply chain sustainability.

The evolution of supply chain management

Transportation and logistics were the main focus in the initial stages of supply chain management development. The main priority was to move goods from one location to another as quickly as possible. Little attention was paid to inventory management or supplier and manufacturer coordination.

However, as a result of globalization, supply chain management has shown a considerable increase in complexity, with cutting-edge technologies being incorporated into the process.

1900s–1960s

During the 1950s, a great deal of attention was given to transportation. There was little to no heed paid to the idea of overall costs – subjects such as supply chain and logistics were not considered.

1960s–1970s

Global trade grew in the decades between 1960 and 1980, thanks mostly to the development of transport by air and road. As a result, global supply chains were created, forcing the development of new techniques to manage inventories and logistics. The field of logistics therefore emerged, but its main focus was still transportation, which led to the creation of the role of logistics manager.

1980s–2000s

In the 1980s, companies began to place a greater emphasis on the quality of their products. Small businesses started to join larger groups to achieve inventory turnaround. This also resulted in systematic production cost planning.

By the end of the 1980s, businesses started to focus more on output volume rather than products. In the 1990s, product availability was the primary driver; companies increasingly focused on getting their products to market rather than increasing their production volume.

The 2000s onward

Companies gained more options to source raw materials and market their products thanks to the increase in international trade and the creation of new markets, especially in Asia. With the growth of the internet, more companies began to explore the field of e-commerce, which led to the evolution of new logistical concepts such as last-mile delivery. AI is currently advancing supply chain management. Furthermore, there has been a growing focus on sustainability.

The role of expert networks in supply chain management

Since expert networks have connections with a wide range of professionals from some of the world’s key industries, they can play a vital role in supply chain management. But let’s delve a little deeper into this topic. How exactly can expert networks help?

1. Improving decision-making

Seasoned professionals recruited by expert networks can share a wealth of experience and knowledge from various sectors of the supply chain. Their insights can potentially help managers to make more informed decisions, from procurement strategies to logistics optimization.

By leveraging several expert networks via a single platform like Expert Network Calls (ENC), you can increase the chances of improving and developing an effective supply chain. ENC allows you to access the most trusted expert networks as well as survey information providers in just one place.

2. Risk management

Because supply chains are vulnerable to a myriad of risks, such as geopolitical events, natural disasters, and market volatility, real-time advice on risk evaluations from experts in the field can help companies to proactively address any potential disruptions.

3. Facilitating innovations

By leveraging expert’s innovative ideas and methodologies, companies can implement effective supply chain solutions and technologies, including AI for demand forecasting, blockchain for cybersecurity, and IoT for real-time tracking.

4. Cost optimization

Expert networks can help companies to connect with experts who can provide insights into cost-saving opportunities across the supply chain. They can recommend alternative suppliers, efficient transportation routes that help reduce overall costs, and more.

5. Adoption of eco-friendly practices

Professionals can offer information on sustainable sourcing, waste reduction, and ways to minimize carbon footprint. Thus, companies will be able to improve the sustainability level of their supply chains.

6. Strategic partnerships

All the connections that expert networks provide can ultimately facilitate long-term partnerships with suppliers, logistics providers, technology partners, and other stakeholders that your company may find important.

Get connected to a broad network of experts with Expert Network Calls.