19 Jan 2022

Supply Chain Technology Adoption Accelerates to Increase Visibility And Support Sustainability According to Latest Report

IDC unveils its Asia/Pacific Top Predictions for Supply Chain in 2022 and beyond

SINGAPORE, January 19, 2022 – The pandemic will continue to impact global and regional supply chains through 2022 due to factory shutdowns, transportation constraints, demand fluctuations, and supply constraints. These challenges place pressure on manufacturing, inventory availability, and last-mile delivery, resulting in increased technology investment in visibility and order management. The impact is being felt across both manufacturers and retailers, with IDC’s 2021 Global Retail survey revealing that the supply chain is among the top three areas of concern for Asia/Pacific (AP) retailers. In addition, sustainability is a rising requirement across the supply chain, which will have implications for traceability, accountability, and financial results, as well as ecosystem collaboration and the development of new sustainable business models.

IDC has published the document IDC FutureScape: Worldwide Supply Chain 2022 Predictions — APEJ Implications  to identify the top 10 predictions for environmental, social, and (corporate) governance (ESG) in 2022 and beyond, providing organizations with context and underlying drivers for IT investments supporting ESG initiatives for the predictions below.

"Supply chains have been front and center in 2021 and will continue to do so in 2022 and beyond as companies see opportunities to collaborate to develop opportunities and build in resiliency," said Stephanie Krishnan, Associate Vice President, Manufacturing and Energy Insights at IDC. "Disruptions are not going away, and organizations will need to continue to respond to economic, financial, environmental, or political changes. In addition to this, customer requirements are also changing as they have adapted to eCommerce and the opportunities for customization and personalization, which will place further pressure on supply chains. Being agile and flexible is a requirement for resiliency as we face continually changing requirements," she added.

IDC's supply chain top 10 predictions provide guidance to business leaders on the upcoming emphasis for ESG-related IT investment.

#1: Supply Chain Resilience: By the end of 2022, half of all manufacturing supply chains will see the benefits of supply chain resiliency, resulting in a 10% reduction in disruption impact.

#2: AI Forecasting: By 2024, 40% of APeJ-based supply chain forecasts will be automated through the use of artificial intelligence, improving accuracy by 5 percentage points.

#3: Sustainability: By 2025, to improve long-term supply chain profitability, 60% of manufacturers in global supply chains will invest in software tools to support sustainability and circular economy business models.

#4: Direct Procurement: By 2026, 30% of all direct procurement transactions will be based upon capacity availability instead of units or volume.

#5: Parts Control Tower: Resulting from pressure to improve service, by 2026, 20% of APeJ-based OEMs will establish a service parts control tower approach increasing first-time fix by 10% and shrinking spares inventory by 5%.

#6: Talent/ Workers: By the end of 2023, chronic worker shortages will prompt 60% of APeJ-based supply chain organizations to prioritize automation investments resulting in productivity improvements of 20%.

#7: Order Management: To improve delivery speed, agility, and visibility for B2B and B2C customers, 35% of manufacturers will invest in order management software by 2025, resulting in a 30% improvement in OTIF fulfillment.

#8: Last Mile: By 2025, 50% of APeJ-based organizations will invest in supply chain systems to increase information and inventory velocity to improve last-mile delivery efficiency and boost customer experience.

#9: Geo-Diversification: By 2026, as part of long-term resiliency planning, 40% of APeJ-based logistics companies will have geo-diversified their manufacturing hubs and suppliers to supplement current supply chain operations.

#10: SC Cloud: By 2024, the adoption of cloud in the supply chain will grow by 25 percentage points driven in part by the specter of cyberthreats.

As the pandemic persists, organizations are dealing with shifting supply chain capacity, demand variability, shipping irregularities, and dawning requirements for sustainability. To get a perspective on Supply Chain predictions for Asia/Pacific Excluding Japan for 2022 and beyond, IDC has organized a webinar hosted by Stephanie Krishnan, Dr. Christopher Holmes, and Sampath Kumar Venkataswamy. To participate in the upcoming webinar, register HERE.

These predictions are discussed in greater detail in the new IDC FutureScape report, IDC FutureScape : Worldwide Sustainability 2022 Predictions — APEJ Implications (IDC #AP47811622). Each year, IDC releases its Top Predictions through its IDC FutureScape reports to give a crystal ball view of what is ahead for the rapidly changing ICT industry. These predictions have been used to shape the strategies and business objectives of technology leaders and business executives in the next 1-5 years. To learn more about the upcoming IDC FutureScape reports, please click HERE.

In case you missed IDC FutureScape Asia/Pacific earlier, you may visit IDC Arena to view Sandra Ng’s keynote presentation. IDC Arena is IDC’s new integrated content hub that takes IDC thought leadership events online, and exclusive analyst essential guidance videos on-demand.

For sales inquiries on an IDC FutureScapes document, please contact your IDC account manager or Sheryl Fuertez at sfuertez@idc.com. For media inquiries, please contact Tessa Rago trago@idc.com  or Alvin Afuang aafuang@idc.com.


About IDC FutureScape

IDC FutureScape reports are used to shape IT strategy and planning for the enterprise by providing a basic framework for evaluating IT initiatives in terms of their value to business strategy now and in the foreseeable future. IDC's FutureScapes are comprised of a set of decision imperatives designed to identify a range of pending issues that CIOs and senior technology professionals will confront within the typical 3-year business planning cycle.

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC  and LinkedIn. Subscribe to the IDC Blog  for industry news and insights.