Resilience takes Preparation

First, let me extend my apologies for the recent absence of this newsletter. I’ve been recovering from a bout of dengue, which took me out of commission for a while. This unexpected disruption has given me time to reflect on the importance of resilience—not just personally but also in the business and supply chain world. Over the past seven years, I’ve built a strong fitness routine, which has been my preparation for moments like this, helping me bounce back faster and stronger. It’s a reminder that much like maintaining personal health, building resilient supply chains requires continuous preparation, agility, and the ability to adapt to unforeseen challenges.

As we continue to explore critical themes like decarbonization, digital transformation, and risk management, it’s clear that resilience—whether for individuals or global supply chains—depends on long-term planning and sustained efforts. Strong preparation, just like in fitness, enables us to better manage disruptions, whether they stem from economic uncertainty, global pandemics, or environmental issues.

I’m excited to reconnect with you all and share the insights from our recent conversations, which highlight the importance of resilience, sustainability, and collaboration in shaping the future of supply chains.

In Conversation: Top Recent Supply Chain Themes

The following are key themes from recent conversations I've had, and as usual, IDC analysts have been busy creating research that coincides with these. I've included links to research below, but continue to scroll down for any free links in addition to the subscription research.

1. Sustainability and Decarbonization: There has been a consistent focus on decarbonization, with companies striving to reduce carbon emissions throughout their supply chains. In particular, long-term contracts with suppliers are being used to facilitate these efforts, and the food and agriculture sectors are leading the charge. These industries are investing in sustainable practices, aligning with the growing demand for circular economy models and Environmental, Social, and Governance (ESG) compliance. For more on this topic, you can explore IDC’s survey spotlight on 'To What Extent Are Asia/Pacific Organizations Designing Circular Supply Chains to Enable Sustainable Business Operations?' (subscription required).
2. Digital Transformation and AI Adoption: AI and digital technologies are transforming how manufacturers and their supply chains operate. From demand forecasting to process and inventory optimization, companies are adopting AI-driven solutions to enhance decision-making and customer engagement. The rise of autonomous supply chains, powered by AI/ML, is making waves in logistics and manufacturing, and you can read more about this in the AI/ML, Generative AI, and the Rise of Autonomous Supply Chains report (subscription required). Also, Jan Burian writes about Rethinking AI and Innovation: From Output-Driven to Process-Centric (free) and how to think about using these transformational technologies for process optimization.
3. Supply Chain Visibility and Orchestration: Supply chain visibility remains critical, especially in managing risk and maintaining resilience in today’s complex environment. Platforms that integrate data from multiple sources are enabling real-time tracking and inventory management, allowing companies to be more agile in responding to disruptions. IDC's recent research, Companies Seek to Improve Supply Chain Visibility and Agility to Mitigate Supply Chain Risks (subscription required), explores the latest in this space.
4. Regulatory Compliance and Risk Management: Navigating the maze of regulations has become a top priority, especially when it comes to sustainability reporting. Companies are looking for tools that can scan, interpret, and manage regulations across different regions to ensure compliance. AI-driven Governance, Risk, and Compliance (GRC) services are gaining traction as they streamline these processes, as discussed in Navigating the Evolving ESG Reporting Landscape — A Guide to Compliance in the Face of Regulatory Changes in 2024 (subscription required).
5. Ecosystem Collaboration and Partnerships: Partnerships are crucial to building resilient supply chains. Collaboration between tech vendors, logistics providers, and manufacturers is increasingly necessary to create efficient, sustainable supply chains. The convergence of industry ecosystems is a driving force behind innovation and efficiency, as highlighted in Industry Ecosystem Convergence for Innovation Acceleration (subscription required) from Jeffrey Hojlo.

Spotlight on Sustainability and Technology

The past quarter has underscored the growing urgency of sustainability in supply chains. With renewed focus on decarbonization, circular supply chains, and sustainable sourcing, companies are recognizing the need for long-term strategies that go beyond regulatory compliance to fully integrate with broader ESG objectives. This shift comes after a dip in momentum in 2023, when economic uncertainty tempered sustainability efforts. Now, technology is playing a pivotal role in accelerating this transition, with AI and digital platforms driving efficiency, transparency, and innovation across supply chain operations.

Recent IDC research provides valuable insights into these themes. I highly recommend the following resources for a closer look at the intersection of sustainability and technology:

1. Sustainable Sourcing Trends and Strategies for Asia/Pacific Manufacturing Supply Chains (March 2024)
2. IDC Survey Spotlight: What Are the Popular Use Cases of AI/Generative AI in Sustainability and ESG Initiatives Among Asia/Pacific Organizations? (July 2024, Melvie Espejo)
3. Sustainability/Environmental, Social, and Governance Spending in Asia/Pacific: Who Holds the Biggest Purse in Tech-Buying Organizations? (June 2024, Melvie Espejo)

In the Spotlight: AI and Autonomous Supply Chains and Manufacturing

AI continues to revolutionize both supply chain management and manufacturing, particularly through advancements in autonomous machinery and robotic operations. The integration of AI/ML and Generative AI is accelerating the transition towards fully autonomous systems, enabling organizations to streamline operations, enhance decision-making, and significantly improve efficiency across the board. This evolution is reshaping not only logistics but also manufacturing processes, making autonomy a key driver of competitive advantage in both sectors. For a deeper exploration of this transformation, The Role of AI in Autonomous Machinery and Robotic Operations (subscription required, Sarah Lee, MBA and Carlos Gonzalez) offers invaluable insights.

Additionally, I had the opportunity to attend CEMAT Melbourne, where we discussed these themes in depth, particularly how AI is paving the way for autonomous solutions in supply chains. You can catch more of this discussion in the podcast here: Listen to the Podcast (free).

Upcoming Events and Research

We have a webinar on 26 September at 11am SGT. I'll share insights from IDC's latest research on generative AI in supply chains and cover practical examples of AI-driven supply chain transformations and how they can enhance visibility and efficiency. If you're interested, register here.

The annual IDC FutureScape event is on the horizon again - mark your calendars for November 8. If you're interested in a conversation, you can book one with me here (book before September 27).

Regards / Stephanie

Stephanie Krishnan, Associate Vice President, IDC Asia/Pacific