Emilia Dunaj
Emilia Dunaj
Head of Technology Insights
January 2024, 14 min. read

Integrating automation from start to finish in supply chains is bringing a big change in how businesses operate. This all-around approach makes every stage of the supply chain work at peak efficiency and in perfect harmony with the others. Using the latest digital technology is how you can keep your business ahead and quickly adapt to changing conditions.

In this article, we’ll explore essential supply chain automation tools and their roles. We focus on how they are transforming areas from inventory management and production to logistics and customer service.

Purpose of digital supply chain automation

To illustrate the purpose of digital supply chain automation, let’s look at an example of a manufacturing business. If your company produces goods, you’ll know that the demand for your products constantly changes due to various market factors. To keep up with these changes, you need to frequently adjust your production strategies. This is where modern supply chain software comes in.

By automating processes, especially the paperwork and data handling aspects of supply chain management (SCM), manufacturers can rapidly respond to changing demands. 

Automation enables the factories to produce more with less manpower and fewer interruptions. Tasks like order processing, inventory management, and logistics coordination, which traditionally required extensive manual input, become efficiently managed through automated systems.

This leads to several key benefits:

  • Efficiency – automation speeds up processes, reducing the time it takes to transition from one production strategy to another.
  • Savings – with less reliance on manual labor for routine tasks, you can cut costs and redirect resources to more critical areas.
  • Accuracy – automated systems reduce the chances of human error in inventory management and order processing. Your operations become more reliable.
  • Flexibility – automation enables businesses to quickly adapt to changing demands. Your company can better meet customer needs and capitalize on market opportunities.
  • Data-driven decisions – automated systems provide extremely valuable data insights. You can make more informed decisions about production and supply chain management.

The biggest beneficiary of supply chain automation is your customer. Faster delivery times, improved product quality, and better service–all these are achievable through automation tools, leading to higher customer satisfaction and loyalty.

5 Essential tools for different stages of the supply chain

5 stages of supply chain

For a supply chain to work effectively, it’s crucial to have a robust digital system linking all departments. This centralized system keeps everyone on the same page, ensuring seamless communication and operations. 

A comprehensive system is packed with specific tools tailored for each supply chain process or task. When everything’s connected and clear, incidents like missing stock or late deliveries are quickly resolved long before they become a problem. 

In this section, we discuss five key types of tools, each designed for a specific part of the supply chain. We’ll see how they work together to create a smooth, cohesive business operation.

1. Procurement and sourcing automation software

Right at the beginning of the supply chain, effective supplier management is crucial. Procurement and sourcing automation tools, such as B2B vendor portals, are transforming this process. These tools change how businesses choose and manage their suppliers, handle contracts, and oversee purchases. They use advanced algorithms and artificial intelligence (AI) to evaluate a wide range of suppliers. This ensures your business makes the best choices based on cost, quality, reliability, and compliance.

The automation extends to order management, where robotics process automation (RPA) technology plays a crucial role. It automates routine tasks like generating purchase orders, invoice matching, and payment processing. By deploying robotics process automation in procurement, you significantly reduce manual errors and shorten processing times. This means the entire process, from generating purchase orders to handling invoice matching and payment processing, turns into an accurate and automated workflow

Additionally, these supply chain management tools bring powerful contract management features. They maintain a centralized database with blockchain technology for enhanced security and transparency, making it easier to manage and renew contracts. At the same time, they monitor compliance, reducing risks associated with contract agreements.

One of the standout features of procurement automation software is the ability to provide real-time data and analytics. These AI insights offer a clear view into spending patterns, supplier performance, and market trends. All this info is extremely important for making strategic procurement decisions.

Many supply chain optimization tools also include collaborative features that enhance partnerships between businesses and suppliers. For example, they might offer shared platforms where both parties can update and track orders and chat functions for quick communication. Additionally, they provide shared dashboards for real-time project monitoring using Internet of Things (IoT) integration. 

2. Production planning and control management system

When it comes to optimizing production planning and execution, automation tools like Enterprise Resource Planning (ERP) systems are invaluable. They bring a new level of efficiency and precision to this critical stage of the supply chain.

The first key feature is advanced scheduling and resource allocation. Supply chain planning tools use advanced algorithms to plan production schedules, allocate resources optimally, and adjust in real time to changing circumstances. Thanks to this dynamic approach, you get maximum efficiency and minimize downtime.

Another significant function is real-time monitoring and control, enabled by IoT technology. Automation tools provide a comprehensive overview of the production process. Managers can track progress and intervene quickly if there’s a problem. With this live visibility, your business can maintain high quality and meet production targets.

Integrating digital twin technology into production planning elevates efficiency and precision. This technology simulates your production environment in a virtual space, allowing for detailed analysis and testing of potential changes. It enhances decision-making, reduces risks, and optimizes operational agility in complex manufacturing settings.

Integration with other supply chain stages is another key feature of these tools. Custom-developed software links up smoothly with other areas, like procurement and warehouse management. This means that the planning for production is always lined up with what’s happening in these other areas, making sure everything in the supply chain works together well. 

The final important part here is how AI tools can predict and prevent problems before they happen, thanks to predictive analytics and maintenance. AI analyzes the production data and spots issues that might pop up. This lets factories fix things before they become bigger problems. Being proactive means there’s less chance of unexpected shutdowns, and production keeps its high quality all the time.

3. Warehouse management tools

Warehouse management requires high efficiency and accuracy to ensure the smooth flow of goods in and out. Advanced inventory management software, like Warehouse Management Systems (WMS) and Cloud-Based Inventory Solutions, are essential in this process. They keep real-time track of all items in the warehouse, offering detailed insights into stock levels, locations, and movements.

Integration with the industrial internet of things plays a crucial role here. IoT sensors and devices help maintain optimal conditions for stock by monitoring factors like temperature, humidity, and light exposure. This ensures that products are stored in the best possible environment, reducing the risk of damage and loss.

This is also where data analytics and AI-powered software come into play. These technologies provide insights to help you understand inventory patterns, enabling data-driven decisions to maintain optimal stock levels, thus reducing the risk of overstocking or stockouts. Additionally, features like barcode scanning and RFID tracking, powered by IoT technology, make the inventory process faster and more precise.

Automated storage and retrieval systems (AS/RS) are another key aspect of modern warehouse automation technology. These robotic systems automate the storage and retrieval of items, significantly enhancing efficiency and accuracy, particularly in large-scale operations. When synced with inventory management tools, they ensure that items are stored and retrieved effectively.

The order fulfillment feature in warehouse automation systems helps smooth out the whole process of getting orders ready and sent out. It guides the way through picking, packing, and shipping, making everything more efficient. This automation means fewer mistakes, faster order processing, and customers getting what they ordered quickly. 

Additionally, warehouse automation solutions often integrate with transportation management systems to optimize the delivery process, using AI to predict the best routes and delivery methods.

4. Transportation and delivery automation software

In the supply chain, ensuring goods reach their destinations efficiently and reliably is crucial for maintaining customer satisfaction and trust. This part of the chain gets a big boost from modern technology, especially the IoT and smart software. 

Route optimization tools analyze factors like traffic patterns, weather conditions, and delivery windows to determine the most efficient routes. This smart planning saves time and reduces fuel consumption and vehicle wear and tear.

The implementation of fleet management systems is equally crucial. These systems provide real-time monitoring of vehicle locations and conditions, helping to manage the fleet more effectively. They ensure timely maintenance, improve driver safety, and enhance overall operational efficiency.

Automated dispatch and scheduling systems streamline the allocation of deliveries to drivers and vehicles. These systems take into account various factors like delivery priorities, driver availability, and vehicle capacity, ensuring that the dispatch process is as efficient as possible.

Real-time tracking and visibility is an extremely handy feature for logistics teams. With the latest systems, you can keep an eye on the exact location and status of your shipments, addressing any delivery issues as they happen. This function is also a big hit with customers. It offers transparency and keeps them informed with the latest updates on their orders. 

Lastly, in transportation automation tools for supply chain, predictive analytics play a crucial role. They analyze past data to predict and prepare for possible delays. This way, companies can proactively avoid problems and keep deliveries consistent.

5. Customer service and returns automation software

A fast and effective response in customer service and returns processes keeps a positive brand image and gets clients coming back. In fact, 77% of consumers think that good customer service is a top brand loyalty driver. 

Handling customer questions automatically with AI agents speeds up the response time and makes sorting out customer issues more efficient. These customer service automation solutions use AI and machine learning (ML) to quickly figure out what customers need, put their questions in order of importance, and give helpful answers right away.

Having a good platform for processing returns and exchanges is key. It makes the entire process smoother, so customers can easily send back products, and businesses can handle these returns quickly. Automated systems sort return requests, generate shipping labels and guide customers through the return process step by step. 

On the business side, these systems track orders in real time, allowing for prompt processing and restocking. Seeing their issues resolve fast keeps the customers happy, fostering a positive experience with your brand.

Feedback management solutions are great for keeping your finger on the pulse of what your customers are thinking and tailoring your offerings to meet their expectations. These platforms collect feedback from your customer service interactions but also from other sources, like surveys, social media, email, etc. 

They then use AI to analyze this feedback, sorting it into categories like compliments, complaints, or suggestions. You’ll be able to easily spot common trends or issues your customers are experiencing.

Case studies of successful supply chain automation

With the integration of modern supply chain tools, businesses are achieving remarkable improvements. In a recent survey, more than a third of executives in supply chain and manufacturing claimed to be starting to use AI in a big way. 

Artificial Intelligence (AI) in Supply Chain Market
Source

Let’s investigate how automation solutions are helping businesses in different ways through real-world case studies.

IoT containers tracking platform

Right Information has worked with a world-known logistics provider based in the UAE to improve transparency during the delivery at all stages. The aim of this project was to improve the tracking and monitoring of goods in the carriage.

This is exactly what we’ve delivered. Our solution, leveraging IoT technology, offers real-time visibility and monitoring of goods in transit, significantly enhancing supply chain transparency. 

The bespoke system marks a leap in supply chain management, elevating efficiency, minimizing risks of loss or damage, and boosting the client’s logistics capabilities. It provides the client with detailed insights into container locations and conditions, along with accurate, real-time traffic-based ETA predictions. 

This project illustrates the transformative power of modern technology in optimizing traditional supply chain methods. For a more detailed exploration of this case study, read our IoT containers tracking platform article.

Delivery scheduling software

Another case study from Right Information’s portfolio involves developing robust delivery scheduling software for a leading global car manufacturer. Its logistics center, a critical point in the network, was facing continuous setbacks that rippled across the entire supply chain operation.

We developed a comprehensive delivery of custom delivery scheduling software to automate and optimize delivery processes. Thanks to the advanced technology, it efficiently manages delivery schedules, ensuring timely and cost-effective operations. The new system estimates timely and optimized delivery routes, which help the client to be more efficient and effectively improve customer satisfaction. 

This solution is a great example of how custom software can address specific logistical challenges and improve overall supply chain performance. For more details about this solution, you can visit our Delivery scheduling software case study.

Amazon’s supply chain strategy

As a global e-commerce leader, Amazon’s supply chain strategy is a blend of innovative technology and efficient processes. 

The company uses modern technology, such as robotics, advanced algorithms, AI, and ML to optimize its inventory. Key elements include Fulfillment by Amazon (FBA), where Amazon handles the entire fulfillment process for merchants, and Amazon Prime, which offers customers perks like free two-day shipping. 

Also, Amazon’s logistics network, including fulfillment and distribution centers, along with last-mile delivery, ensures timely and top-quality product deliveries. They heavily rely on Amazon Web Services (AWS) for storing and analyzing data, which plays a big part in making their supply chain run smoothly.

Amazon’s Multi-Channel Fulfillment (MCF) service makes it easier for sellers on external websites to use Amazon’s logistics. Sellers can store their products in Amazon’s warehouses, and Amazon takes care of packing and shipping their orders. This service also tracks and manages customer returns. It’s a convenient way for sellers to manage their orders and shipping without needing their own logistics setup. 

Selecting the right SCM software for your business

Choosing the right supply chain management software starts by assessing your current processes. You need to identify areas that need improvement or could benefit most from automation. This thorough assessment will highlight your specific needs.

Then, define your objectives clearly. What are your aims with automation? Increased efficiency, cost reduction, improved accuracy? Knowing your goals helps steer you toward the right tools.

At this point, you have a clear idea of your needs, so you can research solutions that match them. 

There are tons of ready-made solutions available on the market. Evaluate how these solutions align with your specific needs, focusing on their flexibility and compatibility with the existing systems you use. 

Ready-made solutions come with predefined functionalities, which might not always align perfectly with every unique business requirement. 

A custom supply chain automation solution, on the other hand, gives you more control over functionality. It ensures a better fit, easy integration, greater scalability, and potentially a more significant return on investment in the long run.

For additional guidance and insights on choosing the right automation tools for your supply chain, explore our Guide to Supply Chain Automation article. 

Conclusion

Automation is a solution to many supply chain glitches. Employing procurement and sourcing automation tools, utilizing production planning software, and implementing warehouse automation systems are key to significantly enhancing operational efficiency.

But the advancement doesn’t end there. Industry leaders are also adopting transportation and delivery automation tools to streamline logistics, and they’re enhancing customer relations with innovative customer service automation software. This way, they ensure a holistic approach to supply chain management.

As supply chains get more complex, staying competitive means smartly using automation. Picking the right tools helps make your operations run smoother and opens doors for new, innovative ways to stay ahead in the market.

The future of supply chain management is here, and it’s digital. Reach out to Right Information, and we’ll help you assess your supply chain needs and pick the best solution for your business. 

The automation will take care of the rest.