The supply chain management landscape is continually evolving, shaped by economic shifts, geopolitical events, technological advancements, and a growing emphasis on sustainability. As we step into 2024, it's important for businesses to stay on top of what’s happening for the sake of staying safe. Let’s have a look at the main supply chain trends of 2023 and what they mean heading into 2024.
1. Economic uncertainty and financial risk
The global economy has always played a significant role in shaping supply chain dynamics. Economic uncertainty and financial risk, fueled by factors such as inflation, downturns, fluctuating exchange rates, and the aftermath of the COVID-19 pandemic, continue to be a critical consideration for supply chain professionals. In 2023, businesses needed to be agile and responsive to economic changes, employing strategies like demand forecasting and scenario planning to mitigate risks, and ensure the smooth flow of goods. In 2024, expect to see continued economic uncertainty shaping the way both clients and suppliers manage risk.
2. Building resilience
Building supply chain resilience became a top priority for companies in 2023, mainly due to rising geopolitical tensions. Trade disputes, sanctions, and political instability can disrupt supply chains and introduce new challenges for supply chain managers. In 2023, businesses had to focus on diversifying their supplier base, investing in technology-based risk mitigation strategies, and closely monitoring geopolitical developments to navigate uncertainties and ensure a resilient supply chain. In 2024, it’s very likely that continued geopolitical factors will keep suppliers and clients on their toes. .
3. Increased cyber risk
2023 saw one of the biggest supply chain-affecting cyber attacks in history: the MOVEit breach. As supply chains become more digitally connected, the risk of cyber threats and attacks continues to rise. From ransomware attacks to data breaches, the potential impact on supply chain operations is substantial. In 2023, organizations had to prioritize cybersecurity measures to safeguard their digital infrastructure. This included implementing robust encryption protocols, enhancing employee training on cybersecurity best practices, and regularly updating and patching software to minimize vulnerabilities. Expect more fallout from the MOVEit breach next year, leading to even tougher cyber security regulations for both clients and suppliers.
4. Sustainability
Sustainability is no longer just a buzzword; it's a fundamental aspect of modern supply chain management. As consumers and stakeholders demand greater environmental responsibility and ESG requirements continue to evolve, businesses are integrating sustainability practices into their supply chains. This includes adopting eco-friendly packaging, optimizing transportation routes to reduce carbon emissions, and collaborating with suppliers who share a commitment to sustainability. In 2024, expect to see an increased emphasis on sustainable sourcing, waste reduction, and overall eco-conscious supply chain practices.
5. Increasing technology investment (and the need for end-to-end visibility)
As our own Insights Report showed, sticking with the status quo, especially when it comes to technology, can have dire consequences. In 2022, only 13% of companies reported having full visibility of their supply chain. 2023 was the year suppliers and clients started to really take a good look at where their risks are. What they found was they didn’t really know. Meaning – they have blind spots. In an age of economic uncertainty, increased cyber risk, ESG requirements, and rising geopolitical tensions, you simply can’t afford to have blind spots. That’s where technology comes in.
At its core, having full supply chain visibility means having data at every stage of the journey: from procurement to production. More and more supply chain companies are investing, for example, in worker management software that allows them to easily verify employee qualifications and accelerate training. They are also taking stock in software that helps them monitor the financial risk of their vendors and build powerful integrations that give them better visibility for better business decisions.
In 2024, only the companies with full end-to-end supply chain visibility will be able to tackle their most significant data challenges and transform information into valuable insights.
Ready to achieve end-to-end visibility in your supply chain? Start today. To learn more about how Avetta helps companies achieve end-to-end visibility and resiliency, click here.
