2015 Supply Chain Trends – In Review

2015 Supply Chain Trends – In Review

2015 Supply Chain Trends - In Review

As 2015 comes to a close, it is always good to look back at our thoughts on supply chain trends and ascertain how we did in our predictions.

The full article is listed here: 2015 Trends in Supply Chain and Logistics

If you missed it, here is the short version of the Supply Chain trends we identified for 2015:

  • Mergers and Acquisitions of Logistics Service Providers
  • The Continued Omni-Channel Challenge
  • Changing Driver Demand
  • Faster Integration of Cloud Computing
  • Additive Manufacturing
  • Autonomous Delivery Vehicles
  • Falling Fuel and Energy Costs
  • Supply Chain Talent and Leadership Gap
  • Advanced Analytics
  • Supply Chain Agility
  • Infrastructure Challenges
  • Increase in Technology Investments
  • Demand for Global Partners

How did we do in predicting what would be talked about in 2015?

XPO LogisticsOn the Mergers and Acquisitions front, I think we nailed this one. While XPO Logistics dominated the headlines with their purchases of both US and European logistics services providers. What was also seen were a number of acquisitions by FedEx, UPS, and other providers. What didn’t make as many headlines in the logistics news was the continued acquisition of automation software and hardware providers by Google, Microsoft, and other technology providers. There have also been some key acquisitions and mergers in the technology software and hardware space that were surprises.

What companies need to be aware of is how these mergers and acquisitions can affect their approach to their vendors. Did the software you select just get bought by a bigger player in the market? What about your transportation provider?  Are they still the same provider as last year? These types of questions cannot always be answered by the service providers and consultants in our Strategy Group can help figure out the best solution for your company in a rapidly changing market.

Oh, Omni-Channel are you ever going to become so mainstream we stop talking about you? This year was not a quiet one for Omni-Channel and the conversation is getting larger, but not because of the reasons that you might think. Many consumers and the logistics press believe that companies are investing in Omni-Channel solutions because that’s what customers want. Not at all. In reality, if you push customers to pick up products in inventory at the store like Walmart is doing with their free shipping to store and same day pick up, you are reducing your parcel freight expense. That has been the big benefit for retailers embracing Omni-Channel this year and will continue to be the key driver as parcel freight carriers raise rates.

Yes, we talked about driver shortages this year and we will continue to do so as long as construction projects continue. Construction continues to be the largest drain on the driver pool and until we see a slowdown in construction, we will continue to see an increase in need to recruit good drivers. With the new Highway Bill increasing Government spending in the US, we will continue to see less drivers in trucks and more of them in hard hats.

AX 7 - Cloud FirstWith the announcement that Microsoft AX 7 will be Cloud First, it demonstrated that more enterprise software providers are taking the cloud first approach seriously. While companies might see this as a way to reduce server expenses, you should make sure to engage knowledgeable partners who understand the risks and benefits of moving your business systems to the cloud.

Fuel and Energy costs are amazingly low right now and didn’t rise as we predicted. Why that is the case is something not fully explained by the mainstream press. While the shale and alternative oil production seemed to be driving the prices lower, the true culprit has been shown to be OPEC. As a way to keep people using their products and not seek domestic sources, they are continuing to increase production. Combined with soft demand in Asia, we are seeing oil prices steadily drop as we enter winter. If El Nino creates a mild winter in the Midwest and OPEC keeps the oil flowing, we could see oil prices continue the downward trend in the coming year.

Tesla Auto Pilot CapabilityWe also were very good at predicting the driverless vehicle trend. Also many commentators have noted that drones in the air are toys at best and the real future is in cars and delivery trucks. With announcements from Tesla and other major manufactures of their auto pilot capability, we will continue to see autonomous vehicles take the headlines in the coming years. What most trucking companies have to consider is the future potential of semi- autonomous platoons of vehicles that need minimal stops and can haul large amount of freight long distances at faster speed than rail.

This past year also led to lively conversations around the talent gap. As the stock markets continue to improve, we have seen more employees enter semi or full retirement. This has caused a lot of conversation in companies about how to fill the leadership gap. Blue Horseshoe has continued to support a number of companies with our Workforce Education and Training Initiatives. This new offering provides a comprehensive training program customized to customers’ needs to help educate employees on new systems and processes.

Blue Horseshoe Strategy DivisionWhile we could talk endlessly about what happened in analytics, infrastructure, and technology this year, we know that these will be a key part of our 2016 trends that will be coming out in just a few weeks. Stay tuned to our blog and social media as we stare deep into our crystal ball to identify the key trends that will have an impact on your business in 2016.

 

 

 

 

 

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