MHI Industry Report: Nearly half accelerated spending on digital technologies during pandemic

Nearly half of supply chain leaders surveyed have dramatically accelerated spending on digital technologies to make their operations more responsive and forward-looking during the pandemic, according to an industry report released today by MHI in collaboration with Deloitte during PromatDX. This year’s report is titled,  “Innovation Driven Resilience: How Technology and Innovation Help Supply Chains Thrive in Unprecedented Times.”

The report, which details findings from a survey of more than 1,000 supply chain and manufacturing leaders, found that companies are moving ahead with digital technologies to make their operations more resilient. Cloud computing, robotics and inventory/network optimization tools saw the biggest jump in terms supply chain investment. Overall, this year’s survey found that 49% of supply chain leaders have accelerated spending in digital technologies to make their operations more responsive and forward-looking during the pandemic, according to the report.

The report also found that a strong majority of respondents, 83%, believe digital supply chains will be the predominant model within just five years, while 22% believe they are now.

According to this year’s respondents, nearly all the advanced digital technologies covered by the survey are expected to achieve widespread adoption within the next 3-5 years. More specifically:

• Cloud computing and storage has the highest current adoption rate at 57%. Adoption is expected to grow to 88% over the next 3-5 years.
• Robotics and automation, currently at 38%, is expected to reach 76% in the next 3-5 years.
• Predictive Analytics, currently at 31%, is expected to grow to 79% in the next 3-5 years.
• Industrial Internet of Things, currently at 27%, is expected to grow to 73% over the next 3-5 years.
• Artificial Intelligence, currently at 17%, is expected to grow to 62% in the next 3-5 years.

When it comes to supply chain challenges, respondents continue to report that their organization’s greatest challenge is hiring and retaining qualified workers, with 52% citing it as “extremely” or “very” challenging. Other top challenges this year include the category of customer requirements in which customers continually expect and demand faster response times and lower costs. Supply chain disruption was also a major challenge, at 39%. Perhaps not surprisingly in this past year of volatile demand, forecasting also was also a leading challenge among respondents.

“Supply chain resilience has never been more important. Companies that made investments in digital technologies prior to the pandemic were more prepared and able to adapt, survive and even thrive during this disruption. They will also be ready when the next crisis inevitably hits,” said John Paxton, CEO of MHI, and one of the participants in today’s ProMatDX Keynote discussing the report’s findings.

The full report can be downloaded from MHI’s site here.