Watch: Today’s Major Supply Chain Hurdles

Volatility, latency and inefficiency are the same problems bedeviling supply chains that they always have been, but they are exacerbated today, says Puneet Saxena, corporate vice president, industry strategies, at Blue Yonder.

The fundamental challenges in supply chain haven’t changed, he says, but they’re more severe than in the past. In fact, disruptions are leading to more supply chain divergence — “between what we thought the plan was going to be and how reality is turning out to be.”

Volatility refers to changes in demand and supply, but the extent of change has never been seen before. Unfortunately, the time lag between the occurrence of an event and when someone learns of it has either remained the same or lengthened. That latency, of course, is one of the main inefficiencies that managers hope to weed out of the supply chain. “And they have all been exacerbated in light of what’s happening with tariffs and with geopolitical tensions,” Saxena says.

At bottom, volatility means uncertainty in the future. If a company can’t predict the future, at least it can attempt to be prepared for it. Scenario planning helps with that. “What if my demand were in this range?” says Saxena. “Where do I want my revenues and margins to be in that range? Think about scenarios and have a playbook ready.”

Combating latency requires advanced visibility, Saxena says. “You have to see what’s happening with inventory and shipments, not only within your enterprise, but across different tiers of the supply chain. Because if I can’t see, then I can’t take appropriate action.”

The “age-old” problem of inefficiency is precisely where artificial intelligence can play a positive role, he says. “This really has come down to better technology-based algorithms. And now machine learning and AI methods are helping people do more without adding to the manual burden.”