Back in 2019, when the Material Handling Industry (MHI) surveyed its members about planned investment in tech, specifically innovation and supply chain technology, most respondents indicated they would be investing in the coming year. Then came March 2020, the pandemic, and a grinding halt to monies spent on technology. Companies were simply trying to keep their heads above water and manage all the unexpected supply chain disruptions.
Now that the pandemic dust has settled, companies are once again looking at how they can enhance operations with innovative technology investments. In MHI’s 2023 Annual Industry Report—The Responsible Supply Chain, 74 percent of respondents indicated they planned to increase investment in supply chain technology and innovation. Categories they are targeting for that investment include AI, blockchain, IoT, robotics, autonomous vehicles, wearable and mobile technology, and 3D printing, among others. Not only that, but budgets indicate that expected spending on innovation will surpass pre-pandemic levels.
Investment In Tech Innovations
When breaking down which innovations respondents expect will create lasting competitive advantage, the order has shuffled some over the past couple of years. Where robotics and automation held the top or close to the top position for several years, it is now holding onto the number-six spot. AI, on the other hand, has not unexpectedly risen to the top spot.
Despite plans to adopt technology and innovations, barriers stand in the way of making that an immediate reality, according to respondents. When looking at the past five years of plans versus actual implementation, there’s a substantial gap, for a variety of reasons. Looking forward, respondents worry that lack of adequate talent may impact their ability to implement their desired innovations. Some 57 percent of respondents named hiring and retaining workers as their number-one challenge to implementation, followed by the talent shortage as their second biggest challenge.
At the same time, respondents recognize that technology can also serve as something of an answer to the labor shortage—once it is up and running. Respondents recognize that technology can help workers improve, which in the end, can ideally lead to better retention rates. In addition to allowing employees to improve their skill set, technology can also create safer work environments, support a better work-life balance, and provide employees with more challenging opportunities. A recent Gallup poll proves this is an important carrot to dangle for millennials, 90 percent of whom say they value opportunities for professional development and career growth.
One of the areas that supply chains are hoping to improve via AI investment is collaboration with partners. Using AI analysis, companies will better be able to share data at all stages of the supply chain. This will allow for improved inventory management, demand forecasting, and behavior tracking amongst partners. According to the survey, more than 75 percent of companies intend to implement new AI use cases within their supply chains. In addition to fostering collaboration, respondents see AI as a valuable tool for making their operations more sustainable.
If an investment in tech is in your future, check in with OPSdesign today!