Supply chain productivity is declining

Cannot be saved by technology alone

According to Gartner, new technologies such as smart robotics and AI have the potential to transform the supply chain function. However, their impact on labour productivity is likely to be limited unless they are part of a broader strategy. Gartner emphasized the importance of an engaged and productive workforce for these technologies to deliver their promised gains. Unfortunately, the data reveals significant challenges in supply chain labour productivity.

Key findings from Gartner’s Global Labour Market Survey indicate the following labour productivity challenges in the supply chain:

  • Only 25 per cent of the supply chain workforce is fully engaged.
  • Turnover in the supply chain function is 33 per cent higher than pre-pandemic levels.
  • Only 16 per cent of the supply chain workforce is willing to go “above and beyond” in their roles.

Implementing new technologies, especially transformative ones like AI and smart robots, is likely to face implementation challenges in any circumstance. However, in the current environment, these challenges are amplified due to increased mistrust and change fatigue. Gartner suggests that a new strategy is needed to ensure successful integration of technology and address the labour productivity slide.

Gartner recommends that Chief Supply Chain Officers (CSCOs) re-examine their approaches in three key areas:

  • Integrating technology and people strategies: Organizations should design the introduction of new workplace technologies with a focus on the human-technology relationship. This includes creating opportunities for reciprocal learning and investing in workforce training, skills development, and knowledge curation alongside technology investments.
  • Individual talent management: High-demand skills may already exist within supply chain organizations but are often constrained by rigid job descriptions. CSCOs can unlock more skills by breaking down projects into component tasks and seeking the required skills across the organization and even beyond it.
  • Organizational design: Crisis situations and market opportunities can be leveraged to break down silos and create more efficient organizational structures. Spontaneous redesign of decision-making processes during the initial disruptions of the COVID era can be harnessed to build resilience in the face of new challenges.

By addressing these areas and developing a comprehensive strategy, organizations can maximize the benefits of new technologies while also improving labour productivity in the supply chain.



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