Each year, Blue Yonder releases the findings of its annual Supply Chain Executives Survey* in conjunction with ICON, the premier conference for supply chain leaders in manufacturing, logistics and retail. Once again this year, the findings of the survey are consistent with what we’re hearing from customers in Dallas this week.
First, the bad news. Based on responses from 600 C-suite and senior executives around the world, supply chain teams continue to face significant challenges — including frequent disruptions. In fact, 84% of respondents worldwide report ongoing and significant supply chain disruptions — including shortages of materials, labor and transportation capacity. These exceptions are causing customer delays, stalling production, interfering with regulatory compliance, damaging financial results and brand reputations, and resulting in lost sales.
And that’s not all. Inflation is driving up supply chain costs, including the price of transportation, materials, labor and inventory. As a result, 46% of executives have seen profit margins shrink over the past year — and that number rises to 60% for companies in the U.S.
Advanced technology takes the spotlight
Now, the fantastic news. The executives in Blue Yonder’s annual survey are extremely optimistic about how advanced technologies — including cutting-edge artificial intelligence (AI) and machine learning (ML) — can superpower their supply chains and help them master these challenges. And this is the focus of what Blue Yonder ICON 2024 attendees will learn this week.
More than half (51%) of companies in our survey have invested more than $10 million in their supply chains in the last year, with much of that investment going toward advanced capabilities like AI and ML. Among U.S. respondents, the number of companies investing more than $10 million in supply chain has more than doubled in two years — growing from 24% in 2022 to 49% in 2024.
The outcomes of these multimillion-dollar supply chain investments? Improved efficiencies (named by 53% of executives), revenue growth (37%), increased market share (37%), fewer disruptions (37%), and increased profitability (29%).
Like the Blue Yonder customers who will share their success at ICON, our survey participants seem to grow in technology maturity and sophistication each year. In the 2024 survey, over half of organizations are already applying AI and ML in supply chain planning (56%), transportation management (53%) and order management (50%). A sweeping digital transformation is a focus of investment for 37% of participants.
And the executives in our survey are investing in some innovative, leading-edge capabilities. In fact, 80% said their companies have organized initiatives to implement generative AI. This subset of AI relies on predictive algorithms to generate responses — such as text, commands or recommendations — to user queries. Among those organizations exploring generative AI, 91% reported that it’s proven “moderately effective” or “highly effective” in optimizing supply chain processes and decision-making.
It’s clear that the world’s supply chain teams are betting heavily on advanced technology to superpower their supply chains. A majority of respondents in our survey — 86% —plan to increase their investments in AI, ML and generative AI in the future.
