Two weeks ago, I did part 1 of a review and comment on the annual report from the trade group MHI (once the Material Handling Industry of America), for 2024, done for the 11th year with partner Deloitte. (See Review and Comment: MHI Annual Report 2024.)
As I said then and will repeat here, it has been a reliably good read, based in part on a large survey of supply chain and logistics professionals. The title this year: The Responsible Supply Chain: Transparency, Sustainability, and the Case for Business.
Gilmore Says.... |
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| The call for more collaborative supply chain data sharing has been around for decades. In my mind, overall we have made slow and incremental progress here. |
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So this year’s report is very aligned with its title, much of which I summarized in part 1.
But to me gladly that’s not all we get in the 2024 document, which covers a number of other topics, which I will summarize below.
Let’s start with a section on technology innovation, where the report survey not surprisingly found artificial intelligence was viewed as the technology most likely to either disrupt the respondent’s industry or create competitive advantage, a combined 58% of companies selected one or the other. AI was followed by industrial internet of things at 56% and autonomous vehicles/drones at 55%.
At the other end of the spectrum for the 11 technologies surveyed was last placed 3D printing (40%) and blockchain (49%). It certainly does feel like the 3D printing wave has slowed.
In a section on supply chain collaboration, the report states that “In the past, companies could succeed by primarily collaborating with a small set of suppliers and distributors. However, the supply shocks of the past few years vividly illustrated that a broader approach is needed to achieve true resiliency, sustainability and adaptability.”
The report lays much of the blame for supply shortages across most industries on a lack of such collaboration. Is that right? I am not so sure.
The report then notes the critical role of information sharing as part of collaboration, noting that “With so much valuable new data being generated, the ability to share data securely and transparently has become a strategic priority.”
This is especially true, the report notes, with regard to reducing CO2 emissions.
I am of two minds on this. The call for more collaborative supply chain data sharing has been around for decades. In my mind, overall we have made slow and incremental progress here.
But I will agree CO2 has changed the game, with many large companies mandating data on the emissions of the extended supply chains (Scope 3 emissions) and it appears mostly getting supplier support – not surprising given the shot gun nature of the requests.
The report ties AI into the collaboration theme, stating that “AI analysis can only be achieved through radical transparency and data sharing at every stage of the supply chain.”
I think that is a bit overstated but can agree the larger the data set, the larger the potential benefits from AI – but with a caveat about trying to "boil the ocean.”
Where do companies see that best opportunities for use of AI in the supply chain?
As seen in the chart below from the report, logistics and transportation top the list, cited by 34% of respondents – though just how AI would be used here remains a little vague.
Source: MHI Report 2024
The number 2 application envisioned is much different and involves supply management (33%).
5% have no current interest in AI, and just 6% see a role for AI in supply chain security. That I think is a mistaken view.
The report offers five high level takeaways from this year’s research:
They are:
• Workers Remain Key Supply Chain Asset
• The Future of Supply Chains Is Digital
• Strong Supplier and Customer Collaboration Is Key
• Circular Business Models and Net Zero Will Become The Norm
• The Rise of Business Intelligence and AI
I won’t quibble too much with those.
The full report is available with easy registration here: The Responsible Supply Chain
What is your reaction to this year's MHI report? What would you add? Let us know your thought at the Feedback section below.
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