Nascent Capability: Artificial Intelligence (AI)
AI is a transformational capability that will still take some time to reach maturity, and is at the Innovation Trigger stage of the Hype Cycle. It applies advanced analysis and logic-based techniques, including machine learning (ML), to interpret events, support and automate decisions, and take actions.
“Given its transformation benefits, supply chain organizations should actively seek to understand the potential of AI and invest in small-scale pilots. Before any big investment decisions, supply chain leaders must be clear about organizational readiness, data and talent availability, and the role of AI in supporting supply chain and business priorities,” Tohamy said.
Evolving Capability: Supply Chain Risk Management (SCRM)
SCRM aims to make businesses resilient to supply chain risks across the physical and digital ecosystem. A comprehensive approach to SCRM focuses on the ability to identify and mitigate risks across the extended network footprint. It is strengthened by technology used for risk identification and monitoring, holistic risk impact analysis and coordinated operational mitigation.
In response to COVID-19, risk management has become front and center as companies needed to sense and respond to supply disruptions and shifts in business models. However, organizations have found that existing risk capabilities have largely been ineffective, and it is at the stage of the Trough of Disillusionment. Despite a major stake in managing risk, there is no clear owner of the process across supply chain functions. “SCRM is a capability that many organizations have already invested in – but are now disillusioned as it didn’t fulfill expectations,” Tohamy added.
CSCOs must reexamine their SCRM strategy and make targeted investments that – for example – help balance the need for resilience with the goal of efficiency when designing a network or that constrains decision-making inputs to improve the quality and speed of decisions in case of a disruption.
Mature Capability: Supply Chain Center of Excellence (SC CoE)
The SC CoE is a physical or virtual center of knowledge, concentrating on existing expertise and resources in a supply chain function, capability or process. CoEs operate adjacent to groups that execute core business functions. They find, design and implement changes to business processes, people or technologies. Gartner research indicates that almost 80% of supply chain organizations have one or more CoEs, indicating a high maturity, and it is at the stage of the Slope of Enlightenment.
“This is the stage where CSCOs can invest in scaling and expanding a capability. Right now, most SC CoEs are focused on IT systems design and technology enablement, but only a few on talent development or change management. This is the next step that will enable the full potential of this capability,” Tohamy concluded.
Gartner clients can read more in the report “Hype Cycle for Supply Chain Strategy, 2021”. This research is part of the Gartner Special Report “2021 Hype Cycles: Innovating Delivery Through Trust, Growth and Change.” The 2021 Gartner Hype Cycles help organizations to make innovation a core competency and shape and prioritize their approach to innovation delivery.
About Gartner Supply Chain Symposium/Xpo
Gartner analysts will provide additional insights into the future of the supply chain industry during the Gartner Supply Chain Symposium/Xpo, which is taking place virtually in the Americas, October 25-27. This conference is the most important gathering of CSCOs and supply chain executives. Supply chain leaders will discover the must-have insights, strategies and frameworks to build the sustainable, societal and profitable supply chains required for a dynamic world.
About the Gartner Supply Chain Practice
The Gartner Supply Chain Practice brings together the most relevant analysis, peer-based best practices, metrics and data across Gartner and offers supply chain leaders a platform to make the choices that will drive their business forward. Additional information is available at https://www.gartner.com/en/supply-chain. Follow news and update from the Gartner Supply Chain Practice on Twitter and LinkedIn using #GartnerSC.