Tag Archives: Supply Chain

Labor shortages, supply chain disruption, and technological change have been cause for concern for executives in the manufacturing industry the last few years. As 2024 draws to a close, business leaders are looking ahead to the coming year. What will manufacturing be facing in 2025?

Here are five trends and challenges we’re expecting for the manufacturing industry in 2025 and advice on how to handle each issue.

1. Digital transformation

It’s not that AI and technology are coming for people’s jobs. It’s about this technology being able to streamline how the job gets done, adding speed, quality, and efficiency to the process. The 2024 Manufacturing and Distribution Pulse Survey Report by Citrin Cooperman found 43% of leaders in manufacturing are currently implementing advanced tech programs and policies in their organizations.

It’s involving AI and Machine Learning to optimize processes and outcomes, the Internet of Things (IoT) which will use smart technology to have machines communicate their own glitches and needs for maintenance, and robotics and automation for tasks like assembly.

The end goal is to increase predictive maintenance, optimize processes, ramp up quality control and provide real-time data for better decision making.

What manufacturing should do:

At USC, we help clients use AI, Machine Learning, and Predictive Analytics to optimize their workflows, processes and demand forecasting. Companies should be using these techniques now, if they’re not already. It’s also crucial to upskill existing employees to be able to work with the new technologies. That’s a win-win for manufacturing companies and their workforce. Higher skilled employees are happier, more effective, and more loyal to the company.

2. Talent

Workforce development, skills gaps and employee retention will be the top issues in regard to talent in 2025. It has been estimated that 1.9 million manufacturing jobs could go unfilled over the next decade if talent challenges aren’t solved. The old guard, long term, experienced employees that executives rely on to get the job done are retiring without a strong pipeline of younger workers to take their place. In addition, the labor force itself is concerned with flexibility, hours, pay, child care and more.

But there’s also the issue of skills. A new study by Deloitte and the Manufacturing Institute found that the need for roles requiring higher-level skills, including technical, digital and soft skills are growing at a rapid rate.

What manufacturing should do:

Working with local trade schools, community colleges and even high schools to offer internships and apprenticeships is a great way to build the talent pipeline.

Also, offering current employees training in digital skills, as well as soft skills like leadership and management training, will provide the company with higher-skilled workforce. This will create a sense of loyalty and pride in the employee knowing the company is investing in them with an eye toward the future.

3. Sustainability

The focus on sustainability is everywhere. Manufacturers are feeling increased pressure to become greener, and as a result are implementing environmental, social and governance strategies.

There is governmental pressure because of tighter environmental standards, but there is also pressure coming from consumers who increasingly want and seek out goods that are manufactured with “clean” methods.

What manufacturing should do:

Continuing to investigate efficient technologies like solar and wind, and making investments in machinery and other assets that are more energy efficient, will be crucial in the coming year and beyond. It will help lower operating costs while satisfying the demand from consumers.

4. Supply chain

Supply chain disruption that plagued just about every business on the planet during the pandemic has eased to a great extent, but challenges are still out there. Lead times for materials is still high, and the cost of transportation and logistics is weighing on companies’ bottom lines.

Shipping delays and uncertainties are a big part of the problem, with headlines nearly every day of yet another cargo ship being attacked at sea.

Then there’s the issue of labor shortages all along the supply chain, both in foreign countries and the U.S., with labor strikes slowing down delivery and labor shortages of truck drivers adding to the snarl.

What manufacturing should do:

It’s extremely challenging for companies to combat labor shortages and shipping delays in their supply chains, but smart demand forecasting and considerations like reshoring supply sources can help. In addition, establishing a strong Sales, Inventory, and Operations Planning (SIOP) program will optimize your supply chain.

5. Tariffs

With a new administration may come new global trade policies, and it’s not just the U.S. that held elections in 2024. Many countries around the globe are restructuring leadership. Ongoing U.S.-China trade tensions will certainly intensify as a result of the tariffs the new administration is proposing, driving up the cost of materials for manufacturers.

What manufacturing should do:

Many manufacturers are ordering supplies and materials now, before the new administration takes over. Stocking up now, in case of major price hikes later.

This issue goes hand in hand with supply chain disruption and is one more reason to consider reshoring and nearshoring of supplies and materials.

The Outlook

Despite ongoing challenges, 2025 looks bright for manufacturers to grow their businesses. Adapting operations to be sustainable and incorporating advanced technology with an upskilled workforce to manage it, business leaders will enjoy major improvements to productivity, their supply chain, and customer satisfaction.

At USC Consulting Group, we’re here to help manufacturing companies become more productive and profitable with standardized operating procedures, enhanced management operating systems, SIOP improvements, and other strategies to find opportunities for greater efficiencies, increased throughput and bottom line results. Contact us today to have your operations humming in 2025.

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The nature of supply chains has evolved over the years, with new technologies and many players in the middle making logistics highly complicated and expensive. A report by PwC indicates that logistics and supply chain costs account for approximately 10% of the organization’s total expenses. This is the most costly issue businesses struggle to minimize in their supply chain operations.

Managed transportation systems (MTS) address this problem, providing an organized way of consolidating logistics and eliminating waste. According to Gartner, the transportation management systems (TMS) market is expected to grow by 60%. This boom exemplifies the role of MTS in adapting to the prevailing dynamics of supply chain management.

This article will define MTS within the supply chain, reveal its operational and financial advantages, and explain how companies can embed them within their current structures and processes without disruption.

Benefits of Using Managed Transportation Systems

Managed transportation systems (MTS) go beyond optimizing shipping routing and data analysis management. They help manage logistics, allowing companies to concentrate on their primary business operations. Outsourcing the transportation management systems promotes professional development within the organization. It also enhances efficiency by eliminating wastefulness and saves costs in the long run.

The following are key benefits of using MTS in your supply chain processes:

Risk Management

Risk management has become more crucial now than ever because disruptions are bound to impact a company’s performance in its logistics industry. A managed transportation system can reduce risk by controlling carrier relationships and fine-tuning supply chain networks while using data-driven predictive tools to prevent delays or inefficiencies.

Cost Savings

Managed transportation systems assist organizations in selecting appropriate carriers and routes. This helps marketers cut transportation costs. In fact, companies that use data-driven insights can make well-organized decisions geared toward saving and managing costs effectively in the long run.

Simplified Day-to-Day Operations

If your company outsources logistics management, it can concentrate on its core business activities, such as developing new products and servicing customers. MTS providers manage logistics complexities, from booking shipments to addressing issues that may arise, so internal resources can be focused on core operations, increasing operational efficiency.

Enhanced Data and Insights

MTS analytics helps businesses monitor where logistics failed in real time. These insights allow businesses to make timely decisions, reduce delivery time, and optimize supply chain operations. Research indicates that data analytics helps cut costs and improve service levels.

Achieving Cost Efficiency with Managed Transportation Solutions

To stay competitive in the logistics market, your business must focus on reducing the cost of operations. But how do we achieve this? It’s pretty simple: Integrate managed transportation systems into your business.

Here are some vital hands-on ways to guarantee cost-effectiveness with MTS.

Carrier Optimization

Cost efficiency starts with choosing the appropriate carrier. MTS providers are not always out to settle on the cheapest rates but instead aim to optimize carrier selection by balancing cost and service performance. This guarantees timely deliveries and reduces transport costs.

Route and Mode Optimization

MTS helps companies find an optimum route and transport mode, resulting in huge cost savings. Increased route planning and mode selection for faster transit times help save on fuel consumption.

Data-Driven Decision Making

Data analytics are essential tools in minimizing a company’s costs. MTS vendors gather information from multiple systems and provide organizations with intelligence regarding logistics activities. Predictive and prescriptive analytics help forecast demand, anticipate disruptions, and make informed decisions that drive long-term cost savings.

Harnessing Data-Driven Insights for Superior Supply Chain Management

As supply chains grow more complex, data and analytics have become more than an optional add-on; they have become enablers of efficiency and resiliency. With the situation becoming even more complicated due to global disruptions, regulatory demands, and changing market conditions, data-driven approaches can bring a paradigm shift in supply chain management.

Here’s how businesses can capitalize on data-driven capabilities to improve the efficiency of their supply chain.

Supply Chain Data Management

Effective data management is the backbone of survival in the modern supply chain. There is an increasing reliance on advanced analytic tools for managing large volumes of data, which warrants quick insights and quicker actions.

According to KPMG’s Future of Supply Chain report, 39% of global supply chain professionals say they will invest in digital technologies to strengthen their data analysis capabilities. The readily available data enables an organization to anticipate interruptions, enhance visibility, and support efficient actions that maximize costs and service.

AI-Enabled Supply Chain Planning

Traditionally, demand planning is frequently carried out across departments using antiquated methods. This always leads to slow and less accurate forecasts. Fortunately, using AI-powered supply chain planning, the gaps between internal and external data can now be eliminated by leveraging unique machine learning models that link disparate types of information into a much more accurate forecast.

Generative AI in Supply Chain

Generative AI (GenAI) can transform supply chain management by making automation and decision-making easy. Examples of Gen AI use cases are translating complex data, summarizing legal documents, and analyzing customer feedback in real time.

Gen AI helps supply chain leaders more easily spot early warning signs, such as disruptions in supplier countries. It also supports faster response due to its capacity for handling huge amounts of information.

Best Practices for Leveraging Managed Transportation Systems in Your Business

A managed transportation system is a significant step and must be planned accordingly. Some best practices can help guide the process and ensure business gain from these systems.

1. Evaluate the Specific Needs of Your Business

Each company has different logistics requirements, and there may not always be a one-size-fits-all answer. When choosing a managed transportation provider or system, map your specific needs and see if they align with what they have—this is key. Shipment volume, frequency, and where you operate your business are some things to reflect on.

2. Monitor Key Performance Indicators (KPIs)

Measuring success for managed transportation system metrics begins with setting KPIs as they provide the capability to formulate results and track ongoing progress. Some metrics to monitor in your LSP are on-time delivery rates, transportation cost per shipment, and how fuel-efficient they run. Frequent monitoring of these KPIs will help determine the probable areas where the system could be improved to deliver desired outcomes.

3. Focus on Continuous Improvement

The logistics industry is ever-changing, and what works today may not work tomorrow. Businesses should be proactive agents, constantly assessing their managed transportation system and making informed course corrections based on data intelligence and performance metrics.

While this explanation can be more in-depth, businesses that embrace these best practices will have a smoother deployment of their managed transportation system and the operational as well as cost-saving results they expect.

Conclusion

There are many benefits of using managed transportation systems for businesses trying to improve supply chain efficiency and cost savings. MTS gives companies the tools needed to modernize logistics by delivering real-time visibility, route optimization, and data-driven decision support so that carriers can gain a competitive advantage in an increasingly complex supply chain. By deploying these systems, businesses can reduce costs and improve compliance and overall customer satisfaction.

*This article is written by Sheer Logistics. Sheer Logistics provides technology-driven supply chain solutions that empower businesses with visibility, efficiency, and agility across their logistics operations. With a focus on transparency and strategic partnership, Sheer Logistics helps clients optimize their supply chains and drive sustainable growth.

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When cargo theft occurs, the entire supply chain suffers. Manufacturers must be aware of these recent trends occurring and act accordingly to protect their assets. With smart planning, businesses can adequately thwart thieves and safeguard their employees. Here are considerations for manufacturers to move in the right direction.

1. Understanding the Most Significant Risks

First, companies should understand the specific threats to which they are most vulnerable. The most immediate danger could be trucks in unsecured areas where thieves can quickly access them. In other instances, manufacturers may see organized crime targeting highly valued goods. Regardless, business owners need to acknowledge their weaknesses.

Researchers have investigated risk influential factors (RIFs) to determine the most damaging aspects. A 2022 study published in Reliability Engineering and System Safety developed a data-driven Bayesian network model to predict and diagnose cargo theft. The experts said product category, year, region, location type and modus operandi are the most significant RIFs. Therefore, manufacturers should be aware of these guidelines.

2. Leveraging Advanced Algorithms

Improving cargo security has become more challenging due to increased attack surfaces and opportunities for outside threats. In response, manufacturers must leverage advanced technologies like artificial intelligence (AI) and machine learning (ML) to protect their assets. Algorithms are excellent tools for business owners because they reduce the theft risk when transporting goods on the road.

A 2024 study published in Computers and Industrial Engineering used a physical internet-based analytic model to combat rising cargo theft. The researchers used real-world scenarios in their experiments to understand the benefits and drawbacks. Their model determined the risk of different product types based on their specific routes, allowing them to better understand the threshold where shipments become vulnerable to criminal organizations.

3. Using the Internet of Things (IoT)

IoT devices are critical for management operating systems (MOS) because they enhance software and hardware capabilities. With these gadgets, manufacturers can improve productivity and financial performance. IoT research is also critical for securing cargo through each step of transit. For instance, GPS technology provides real-time knowledge of each shipment.

Manufacturers should take advantage of IoT because it can be present with the device and around the facility. Smart cameras are an excellent example because business owners can remotely monitor the feeds and promptly take action. Advanced technology also lets manufacturers take extra steps to protect their cargo. Smart locks with biometric recognition are a vital safeguard against thieves.

4. Improving Cybersecurity Practices

Cargo theft increased by 46% in the first quarter of 2024 compared to the same time in 2023. CargoNet reported 925 incidents in the quarter, emphasizing the need for heightened security tactics. While physical barriers are necessary, manufacturers should also improve their cybersecurity practices. Internet crime is equally damaging to companies and could be more challenging to predict.

Ransomware attacks are among the most pivotal for manufacturers, considering their frequency. A 2022 IBM report found that 23% of these incidents affected manufacturing, making it the most targeted industry. Preventing ransomware attacks entails basic to advanced cybersecurity tactics, such as multifactor authentication, anti-malware software and software updates.

5. Selective Supplier Partnerships

Some manufacturers outsource specific tasks to reduce overhead and strengthen their bottom line. In addition to these partners, companies must watch other links in the supply chain. Businesses should monitor supplier relationships to ensure security — otherwise, they risk lost revenue and downtime while fixing errors.

Supplier relationships start with background checks and regular audits. Manufacturers must ensure these partners do their best to detect and address vulnerabilities. Business owners should find companies with pertinent industry certifications like C-TPAT if applicable. Monitoring should continue throughout the relationship with consistent communication and key performance indicators (KPIs).

6. Properly Training Employees

While suppliers can be security liabilities, it’s equally essential for manufacturers to monitor their employees. Workers may willingly or unknowingly contribute to cargo theft through their actions, so businesses should protect them from themselves. First, company leadership should train employees on best security practices, such as reporting procedures and proper loading.

Then, the company should focus on internal theft from its workers. Experts say over 75% of employees have stolen from their employer at least once. Therefore, robust internal measures should be in place to prevent theft. Mitigating employee stealing includes restricting access control and using biometric scanners. Business owners could also encourage workers to be vigilant of suspicious activity.

7. Controlling Supply Chain Aspects

Ultimately, it’s up to manufacturers and business owners to control as many supply chain aspects as possible. Internal audits are a valuable tool because they reveal gaps in shipments and where theft has potentially occurred. Once a company understands its insufficiency, leadership teams can act accordingly. Businesses should audit their inventory, security and other critical business features.

Supply chain professionals should also regain control in areas they may consider less secure, such as transit. Highways and oceans provide plenty of unknowns, so businesses must protect their cargo before, during and after the route. Besides GPS devices, forward-thinking companies wield electronic seals, telematics devices, light sensors and other tech.

Tackling Theft and Protecting Assets

The rise in cargo theft should alarm manufacturing professionals and business owners. Outside threats have become more sophisticated through physical and cybersecurity risks. While crimes have increased, manufacturers should proactively combat thieves. Leadership teams should scrutinize suppliers, employees and other aspects of the supply chain to ensure safety.

*This article is written by Jack Shaw. Jack is a seasoned automotive industry writer with over six years of experience. As the senior writer for Modded, he combines his passion for vehicles, manufacturing and technology with his expertise to deliver engaging content that resonates with enthusiasts worldwide.

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As technology continues to improve, large companies and supply chain manufacturers have more opportunities to expand their businesses and reach more customers with their products. With this power comes responsibility, calling for transparency in supply chains.

Reliable tracking systems must be implemented to enhance supply chain transparency and ensure businesses and customers get the accurate information they need. Real-time visibility platforms (RTVP), new technology and optimized data collection can create more visible supply chains.

What Is a Real-Time Visibility Platform?

Real-time visibility allows for the tracking and monitoring of products and goods, from pickup to delivery. With real-time data, all steps involved in the supply chain process are receivable, making it much easier for large companies to provide honest product and transportation details.

Real-time visibility platforms are the software tools and technologies that make this data possible. RTVP gathers data based on live updates on product location and status.

What Technologies Play a Part in Real-Time Visibility?

Like many things today, real-time visibility would not be possible without technology. As systems continue to grow, so does the potential for full transparency.

Many technologies work together to make real-time visibility possible. The following are some of the tools used to streamline processes and maximize supply chain transparency:

1. GPS

GPS technology has become an integral part of the real-time visibility process and enables RTVP to track objects for accurate data. GPS technology uses satellite signals and signal reception to capture the location of items, roads and buildings, and it sends this data back to our devices.

GPS technology does wonders for the transportation industry. By accurately tracking trucks and other transportation vehicles, we can watch products travel from point A to point B and make decisions based on their location.

2. AI

Artificial intelligence has entered many realms of society, including the supply chain. Fortunately, AI makes RTVP possible for various transparency purposes.

AI considers all factors and works alongside humans to enhance decision-making and efficiency, leading to a faster, safer and more honest supply chain. AI also powers advanced analytics to help humans and businesses analyze real-time data, making it applicable to all industries.

3. Internet of Things (IoT)

IoT creates a robust network that allows data to flow freely and improves connection and communication between different devices. Through this created network, IoT can narrow down specific items and points of data to share information and even make decisions.

From quantity to fulfillment, IoT processes data through algorithms that contribute to accurate, real-time visibility.

4. Blockchain

Blockchain acts as a safety tool for RTVP, “blocking” hackers and other forms of data manipulation. There are four main types of blockchain: public, private, hybrid and consortium. Each form creates a securely shared network of data that allows parties to communicate.

Blockchain allows equal access for all parties, and there is no single network owner. This provides for ethical, open movement throughout the supply chain and adds transparency to traditional supply chains.

Why Implement a Real-Time Visibility Platform?

Real-time visibility platforms provide endless benefits to supply chain industries. RTVP acts as a high-functioning network of technology and intelligence to help businesses identify areas for improvement and solve problems in all areas — from ethical to logistical.

With RTVP, there is no shortage of possibilities. The following are four benefits of implementing a real-time visibility platform:

1. Ensure Customer Satisfaction

Without RTVP’s technology, product location and safety are unknown to businesses and customers. When companies implement a real-time visibility platform, “the unknown” is eliminated. With access to knowledge such as when and where their goods will arrive, customers know exactly what to expect.

RTVP shares information with customers they previously did not have access to, such as ETAs and tracking details. The more customers know, the happier they will be!

2. Speed up Reaction Time

RTVP gives companies the power to detect precisely when and where disruptions occur, from departure to arrival. If an issue arises along the way, businesses know in real time, allowing them to immediately develop a direct course of action.

Companies can mitigate risks with transparent access to data, which reduces wasted time spent planning strategies and reacting to issues. RTVP allows for the tracking of delays, traffic, congestion, weather and anything else that could pose a potential threat.

3. Reduce Costs

Implementing a real-time visibility platform provides many financial benefits. Companies have access to trucks and products, allowing them to see available capacity and, in turn, utilize all available space. This creates sustainable, efficient transportation and also cuts costs.

Many industries are now dealing with labor shortages, rising material costs and an ever-changing risk landscape. With RTVP, industries can detect traffic, weather conditions and other risks to product transportation, reducing the risk of unnecessary financial burdens. With saved time and money, industries can focus on solving more significant issues.

4. Improve Relationships

RTVP uses technology to improve relationships between all parties involved. With transparency and proper information sharing, people can access honest details, avoiding the risk of being blindsided or misinformed.

Transparency positively impacts shippers, managers, workers, clients and customers, resulting in better collaboration and more satisfied people. RTVP also enhances communication, allows for honest lane sharing and improves handoffs and business interactions.

Use RTVP for Supply Chain Transparency

RTVP allows supply chain leaders and manufacturers to stay ahead of their industry and interact with advanced modern technology. Businesses can work hand in hand with real-time data to make their processes more efficient and keep customers satisfied. With RTVP,  transparency is possible.

***This article is written by Jack Shaw. Jack is a seasoned automotive industry writer with over six years of experience. As the senior writer for Modded, he combines his passion for vehicles, manufacturing and technology with his expertise to deliver engaging content that resonates with enthusiasts worldwide.

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Spend analysis is essential, yet complex and most organizations are unaware that spend analysis can be simplified and accelerated by implementing a structured system like the United Nations Standard Products and Services Code (UNSPSC). 

In today’s competitive landscape, accurate and insightful spend analysis is critical for organizations to manage procurement efficiently, identify savings opportunities, and drive strategic purchasing decisions. However, many companies struggle with inconsistent data classification, making it challenging to gain meaningful insights. This is where UNSPSC classification can make a significant difference.

Understanding UNSPSC

The United Nations Standard Products and Services Code (UNSPSC) is a globally recognized system designed to classify goods and services. Its hierarchical structure includes segments, families, classes, and commodities, allowing for a granular approach to categorizing products and services across regions, suppliers, and industries. 

By applying UNSPSC codes to procurement data, companies can standardize and streamline their spend analysis, enabling more efficient procurement processes and better decision-making.

The Impact of UNSPSC on Spend Analysis

Standardization of Data

One of the most significant challenges in spend analysis is dealing with inconsistent data across departments, suppliers, or geographic locations. Without a standardized classification system, companies often struggle to compare or consolidate spend data meaningfully. UNSPSC addresses this by providing a consistent framework that ensures all products and services are classified uniformly. Whether your business operates in multiple countries or deals with various suppliers, UNSPSC enables a cohesive and structured view of your procurement activities.

Improved Visibility into Spend Categories

The granularity provided by UNSPSC allows businesses to break down their spending into specific categories, such as office supplies, IT equipment, or professional services. This level of detail helps organizations pinpoint their most significant spending areas and uncover opportunities to optimize procurement. For example, a company can monitor category-specific trends, enabling them to identify potential savings in areas like facility maintenance or software subscriptions.

Difficulties in Spend Analysis Without UNSPSC

Without a robust classification system like UNSPSC, companies often face a range of challenges in their spend analysis efforts. First, manual classification of data is time-consuming and prone to error, making it difficult to achieve consistent categorization across departments. Moreover, inconsistencies in spend data make it harder to track, monitor, and report on procurement activities, leading to a lack of visibility into spending patterns and hindering efforts to benchmark suppliers effectively.

When spend data isn’t accurately categorized, organizations may miss opportunities for cost savings, such as consolidated purchases or volume discounts. Additionally, they may struggle with regulatory compliance, as inconsistent classification complicates audit processes and increases the likelihood of reporting errors.

Enhancing Spend Analysis with UNSPSC

To fully unlock the potential of spend analysis, companies can implement UNSPSC in several ways:

1. Standardized Spend Categories
   Implementing UNSPSC in spend analytics ensures that all procurement data is classified using the same system. This improves visibility across different departments and regions by creating a uniform view of spend data, making comparisons and consolidations easier. For example, a global company can standardize procurement data from various offices, enabling centralized analysis that supports strategic purchasing decisions.
2. Improved Spend Visibility
   With UNSPSC, companies can break down spending into highly detailed categories. This granular visibility allows procurement teams to monitor specific spend areas, such as IT services or logistics, and identify opportunities for cost reductions. By isolating spend patterns, companies can reduce redundant purchases and optimize their procurement strategies.
3. Supplier Benchmarking
   UNSPSC provides a consistent way to categorize suppliers, allowing organizations to benchmark costs for similar goods or services from different vendors. This enables companies to compare suppliers more effectively, helping them identify opportunities for cost savings or improved performance within specific categories.
4. Spend Control and Compliance
   By categorizing spend data with UNSPSC, companies can more easily identify areas where spending exceeds budget thresholds. This system helps organizations gain better control over their procurement activities, enabling more targeted cost reduction efforts. Moreover, using standardized classifications simplifies compliance with industry-specific regulations, improving audit readiness and ensuring that procurement activities meet necessary reporting requirements.
5. Automated Spend Classification
   When combined with AI-driven analytics platforms, UNSPSC can enable automated spend classification, reducing the need for manual efforts. AI algorithms can map purchases to the correct UNSPSC codes, ensuring real-time categorization of new transactions. This automation allows procurement teams to focus on strategic initiatives rather than getting bogged down in manual data management tasks.
6. Enhanced Predictive Analytics
   By using UNSPSC to organize historical spend data, companies can apply predictive analytics to anticipate future procurement needs. For example, trends in past spending across categories like consulting or software licenses can inform contract negotiations or help manage inventory levels more effectively, providing a proactive approach to procurement.

How AICA Can Help Optimize UNSPSC Classification and Spend Analysis

We recognize that implementing and maintaining UNSPSC classification can be a daunting task for many organizations. That’s why AICA’s advanced AI-driven solutions are designed to support businesses in classifying their data according to the latest version of UNSPSC. 

Here’s what makes AICA’s classification service unique:

1. Speed and Accuracy
   AICA’s AI solutions are up to 90% faster than traditional manual methods, allowing you to implement UNSPSC classifications quickly and efficiently. Our specialized algorithms ensure a classification accuracy of over 80%, far surpassing what can be achieved through manual data entry or general AI models.
2. Cost-Effective Data Maintenance
   Maintaining an accurate and up-to-date classification system is crucial for long-term spend analysis success. AICA’s solutions automate much of the classification and data enrichment process, reducing operational costs and freeing up procurement teams to focus on higher-value tasks.
3. Customized Solutions
   Every company’s procurement system is unique, and AICA provides customizable services to ensure that your UNSPSC implementation aligns with your specific needs. Whether you require one-time data classification or ongoing support, AICA can help you streamline your procurement activities and maximize the value of your spend analysis.

Conclusion

UNSPSC classification is more than just a tool for organizing procurement data; it’s a strategic approach to enhancing spend analytics. By implementing this system, companies can gain better visibility into their spending, improve supplier benchmarking, and control costs more effectively. AICA’s advanced AI-driven solutions can help you leverage UNSPSC classification to its full potential, ensuring that your spend data is clean, consistent, and actionable.

*This article is written by USC Consulting Group’s strategic partner in data cleansing and management, AICA. For more information how AICA can cleanse and enrich your product and services data with AI, visit their website.

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Factors ranging from the weather to celebrities’ social media posts can spur the public’s demand for particular products. Those spikes can cause supply chain constraints company leaders aim to avoid. It is better when corporate teams can predict what people will want and get those products far enough in advance to cater to everyone wishing to buy them. To achieve this, businesses are using AI to strengthen their supply chains. Here’s how…

Managing Demand While Selling Diverse Product Assortments

Demand planning is especially complicated when retailers sell huge varieties of goods within a large category. Such was the case with one of Canada’s largest electronics retailers. People go there to purchase everything from phone chargers to televisions.

However, the demand for those two examples is very different. Many consumers buy several phone chargers per year, such as if they want one for each main room in a home or have forgotten to pack the item before going on a trip. However, most TVs last several years, and people only buy them once the ones they have break or otherwise no longer meet their needs. Plus, many shoppers are more likely to buy those big-ticket items during the holiday season than at other times.

The Canadian retailer uses AI and machine learning technologies to get data-driven demand insights that shape inventory and supply-chain-related decisions. Its leaders have already noticed several benefits. For example, demand planning has become more automated, and those involved can receive detailed reports highlighting potential business risks and impacts.

Additionally, supply chain employees can address slow-moving inventory, plan more enticing promotional offers and reduce stockouts. Another aspect of the AI solution evaluates various supply chain scenarios and gives prescriptive recommendations to prevent unwanted consequences. These examples show how AI can support workers in their roles and increase productivity.

A common misconception about AI is that it will replace human staff. One study found job loss from automation and other advanced technologies was a worry for 42% of respondents. However, besides assisting them with the tasks they already know, artificial intelligence can expand their skills, encouraging them to use new platforms and tools that make demand planning easier.

Streamlining Demand Planning Processes for Better Productivity

Demand planning processes vary depending on what the brand sells, the size of its supplier network, its budget and more. However, no matter how organizations handle them currently, AI can pinpoint opportunities to streamline the work for better overall outcomes.

One example comes from a multinational consumer goods enterprise offering diapers, detergent, personal grooming products and other household staples. Leaders hoped to improve current demand planning by bringing artificial intelligence into the workflow. Initial data inputs for the project included bill-of-materials information for 5,000 products and 22,000 components. Additionally, users imported various types of supporting supply chain details into the system, including specifics about vendors, warehouses and manufacturing plants.

The technology then compiles all that information to give real-time or trend-based insights. Besides providing live inventory data, the AI product can generate supply projection reports that indicate future needs while highlighting possible supply chain disruptions. Knowing about potential issues sooner gives employees the information to act confidently and prevent or mitigate those problems.

The tool was also a significant productivity booster for the consumer goods firm. For example, supply chain queries used to take more than two hours to complete but now occur immediately. Additionally, although it formerly needed more than 10 people to verify the data, the technology can do that without human oversight. Such improvements substantiate studies showing AI can make people 20%-45% more productive depending on various factors.

Running Supply Chain Simulations Before Key Events

Even though some periods of increased demand are impossible to predict, most supply chain managers can anticipate others with near certainty. For example, Black Friday is one of the biggest shopping days of the year in the United States. Additionally, late summer drives sales of bedding sets, reasonably priced furniture and school supplies as students prepare for college.

Demand planning is essential for giving supply chain professionals the necessary information to source and move the products customers will want most during those hectic periods. Since artificial intelligence can process large quantities of information quickly, users could feed details such as social media mentions, customer service email or chat data, and sales figures into tools to determine which factors make some products more or less desirable.

The leaders of one multinational American retailer used AI to determine what customers would want before Black Friday arrived. The goal was to learn those details before shoppers even consciously expressed a desire to buy specific items. While using the artificial intelligence platform, retail staff entered data about shopping and customer trends, seasonal factors and more. The resulting output steered supply chain decisions and helped address issues that might ordinarily cause Black Friday disruptions.

The retailer has also added AI to its daily supply chain workflows, relying on the technology to anticipate demand cycles and unexpected traffic peaks. Some businesses use complementing technologies such as digital twins to get similar results. These tools enable people to predict bottlenecks and investigate potential actions before pursuing them in real life.

Making Demand Planning More Manageable

Demand planning is tricky and requires a thoughtful approach from people who combine their expertise with trustworthy data. However, these examples show how purposeful AI applications can assist with this all-important aspect of supply chain operations, increasing the likelihood of satisfied customers and profit.

*This article is written by Jack Shaw. Jack is a seasoned automotive industry writer with over six years of experience. As the senior writer for Modded, he combines his passion for vehicles, manufacturing and technology with his expertise to deliver engaging content that resonates with enthusiasts worldwide.

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Efficient warehouse management is crucial for the success of any business. However, numerous challenges can hinder operations and impact overall profitability. Understanding these obstacles and implementing effective solutions is essential for optimizing warehouse performance.

Common Warehousing Challenges

Ineffective warehouse management practices, such as inadequate order and inventory management, can lead to significant inefficiencies and losses. Inaccurate data, inconsistent tracking, and insufficient space further exacerbate these issues. Additionally, erratic changes in demand and economic fluctuations can disrupt operations and make it difficult to maintain optimal inventory levels. Packaging wastefulness and design shortcomings can also contribute to increased costs and environmental concerns.

Optimizing Inventory Management

To address inventory management challenges, businesses should invest in advanced technologies and streamline processes. Implementing cloud-based inventory management platforms with demand forecasting tools and automated reordering systems can help optimize stock levels and reduce carrying costs. Utilizing mobile productivity tools allows for real-time inventory tracking and control, improving efficiency and accuracy.

Enhancing Warehouse Layout and Space Utilization

Maximizing warehouse space utilization is crucial for optimizing operations and reducing costs. Implementing a well-designed warehouse layout, incorporating storage solutions that maximize vertical space, and utilizing advanced warehouse management systems can help streamline workflows and improve productivity.

Leveraging Technology and Data

Technology plays a vital role in modern warehousing. Implementing barcode technology and system-directed pick/put-away procedures can significantly improve order fulfillment accuracy and speed. Digitizing documentation and utilizing data analytics can provide valuable insights into inventory levels, customer demand, and operational performance.

Addressing Packaging and Sustainability

Packaging waste and design shortcomings can impact both costs and environmental sustainability. Collaborating with pharma packaging machine manufacturers to optimize packaging design can help reduce waste and improve efficiency. Additionally, implementing recycling programs and using sustainable packaging materials can contribute to environmental responsibility.

Overcoming warehousing challenges requires a combination of strategic planning, technological advancements, and efficient processes. By addressing issues such as inventory management, space utilization, and packaging optimization, businesses can improve operational efficiency, reduce costs, and enhance customer satisfaction. The resource below provides a visual overview of common warehousing challenges and potential solutions.

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At USC Consulting Group, we’ve been empowering performance for more than 50 years. What does that mean?

It means we’re an operations management and process improvement firm that empowers your people and processes to achieve operational excellence.

The below graphic lays out our experience and the areas we specialize in:

Let’s look in more detail at how USC partners with you to accelerate and augment your process improvement efforts.

What we focus on

Operational excellence. We help clients define and implement a strategic approach to achieving and maintaining the highest levels of operational performance. It’s about eliminating waste, improving quality and ramping up productivity.

Process improvements. We look at your processes through the lens of efficiency and effectiveness. We identify bottlenecks that might be slowing down your workflow, assessing the “we’ve always done it this way” processes that every business has. We find that a fresh set of eyes on these types of long-held processes can yield more effective ways to achieve results.

Optimal efficiency. This is about the “well-oiled machine” factor. Everyone knows what that is, although it’s different for every company. It’s when you’re cooking and booking, churning and burning, and achieving the maximum throughput for your efforts.

Supply chain optimization. In the post-Covid era, we’re still seeing supply chain disruption and the headaches they cause. We help companies analyze their supply chain networks and spot inefficiencies and bottlenecks. Is there a supplier closer to home? Is it time to reshore? Can we improve procurement or logistics?

Change management. Many of the process changes we recommend involve new ways of doing things – perhaps significant changes. With training and development, strong communication and getting feedback and input from stakeholders, we can help companies embrace change for the better.

Asset Performance Management. At USC, we focus on getting the most out of the assets you already have. Heavy investments in new technology is not always necessary, especially if your old workhorses just need some care and feeding. Applying predictive maintenance to reduce unplanned downtime, usage that doesn’t cause more wear and tear than necessary, and processes to extend the lifecycle of the tools you rely on.

EBITDA improvement. This refers to a company’s Earnings Before Interest, Taxes, Depreciation and Amortization. Sounds like your worst day in the accountant’s office, right? But it’s really about helping clients look for cost-savings opportunities, revenue enhancement, and more. It’s also about everything else we do – productivity improvement, asset management, operational efficiency, cost reduction and more.

How we do it

How do we enhance our clients’ operations? We’re experts in process improvement methodologies and tools, like:

Lean Six Sigma. LSS is a combination of two powerful methodologies, Lean, which focuses on limiting waste in a process, and Six Sigma, which focuses on increasing quality.

Sales, Inventory, and Operations Planning (SIOP). In a nutshell, SIOP aligns sales, inventory and operations planning functions to improve demand forecasting, efficiency, supply chain performance and more.

Employee Involvement Prototype Process. One of the cornerstone techniques USC uses to validate and measurably implement changes to elements of the MOS with full client personnel engagement. Your employees are the most vital components to every project, especially the workers in the trenches on the shop floor or production site. We involve them every step of the way.

System Reviews. We do a comprehensive analysis of your systems, processes, procedures and more. System Reviews tell the story of a company’s process and depicts the future state MOS with the deficiencies from current state corrected. It shows the flow of data, actionable information and decision-making points in a closed loop environment.

LINCS advanced reporting tools. The Lean Information Control System (LINCS) is a state-of-the-art software application that facilitate fact-based decision making from the shop floor to the boardroom. It includes modules for advanced planning, manufacturing and logistics, value stream mapping, scheduling, inventory analysis and more. Operators are able to see and evaluate their work as it takes place, while executives and managers are better equipped to prioritize activities based on accurate, actionable information.

AI, Machine Learning, and Predictive Analytics. Much like Netflix’s use of predictive analytics created a seismic shift in consumer expectations, this new technology is transforming operating procedures and processes. Predictive analytics helps companies better understand what’s occurring in any given process, refine and optimize processes, and more. But, it also needs the human touch. People aren’t getting replaced by the bots in this area any time soon. To learn more, download our free eBook: AI and Machine Learning: Predicting the Future.

Our 55-plus years of experience covers a wide variety of industries, including:

• Mining & Metals
• Food & Beverage
• Manufacturing
• Building Products
• Automotive
• Pulp & Paper
• Life Sciences
• Oil & Gas
• Utilities & Energy
• …And many more

We have a defining principle to our approach that guides every project. We do not swoop in and tell companies how to do it better.

We are partners in the process. We work with your team to implement the changes at the point of execution.

We listen to what makes your company tick, observe your current operations, get a handle on the issues, involve your frontline employees in the process, and implement a plan for change.

We play the long game, delivering results our clients can maintain for years to come. We don’t have our 98% customer satisfaction rating for nothing.

That’s how USC Consulting Group empowers YOUR performance.

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In Gartner’s latest report “Top GenAI Use Cases That Work Best for Supply Chain Logistics,” Carly West and Jose Reyes highlight the transformative impact of generative AI (GenAI) on supply chain logistics.

The key findings from their research indicate a widespread exploration of GenAI, with nearly 100% of supply chains investigating its potential to improve operations.

Additionally, organizations are dedicating an average of 6% of their 2024 budgets to GenAI technologies, underscoring the significant investment in these advancements.

Furthermore, 65% of organizations are creating new roles specifically for generative AI expertise, reflecting the need for specialized knowledge to leverage these technologies effectively.

Generative AI and Key Use Cases

Generative AI, supported by foundation models trained on vast datasets, offers numerous applications within logistics. One prominent application is content creation, which includes drafting KPI scorecards, creating standard operating procedures (SOPs), and generating essential documents such as shipping forms and RFP templates. Another key use case is information discovery, where AI aids in KPI analysis, supplier performance diagnostics, and managing shipment inquiries, thereby streamlining processes and enhancing decision-making support.

Generative AI excels in summarization tasks, efficiently summarizing meeting notes, reports, and customs documents, which helps in managing large volumes of information. In transportation and warehousing, AI-driven solutions facilitate predictive maintenance, enable autonomous systems for robotic picking and document processing, and provide real-time customer assistance, contributing to more efficient and reliable operations.

Implementation Considerations and Challenges

For successful AI implementation, it is crucial to assess the feasibility and business value by evaluating talent availability, technology readiness, and data quality. Effective data governance is also essential, as organizations with well-managed data report more impactful business outcomes. However, data-related barriers such as accessibility, quality, and complexity remain significant challenges that must be addressed. Furthermore, by 2027, 50% of large organizations are expected to reevaluate their data governance to handle complex, data-driven use cases effectively.

AICA’s Role in Addressing Opportunities and Challenges

AICA specializes in product and service data cleansing, enrichment, creation, and comparison, leveraging advanced AI and ML algorithms to detect and rectify errors in datasets.

Enhancing Data Quality and Consistency

AICA’s data cleansing and enrichment services ensure high data quality, crucial for leveraging GenAI in logistics. They address data inconsistencies and quality issues through robust data cleansing processes, including deduplication and anomaly detection.

Facilitating Data Integration

Modular design supports the seamless integration of diverse data sources, aligning with logistics’ needs for unified data systems. AICA’s data normalization services enable standardized data formats for efficient processing, overcoming integration difficulties.

Strengthening Data Governance

Data governance framework establishes clear standards and accountability, enhancing AI readiness. Their domain-specific algorithms ensure compliance and data integrity, helping organizations navigate data governance challenges.

Supporting Multilingual and Localization Needs

Multilingual translation capabilities support global logistics operations, making data accessible across languages. AICA is able to overcome language barriers and localization issues with precise translation and cultural adaptation of data.

Enabling Advanced Analytics and AI Use Cases

AICA utilize AI-driven insights for advanced logistics analytics, including predictive maintenance and KPI diagnostics. Their comprehensive data management solutions enhance model accuracy and reduce bias, tackling AI implementation barriers.

Enhancing Operational Efficiency

AICA leverage AI solutions to automate routine tasks and improve logistics efficiency, aligning with GenAI’s potential. Efficient data processing capabilities address time constraints and resource allocation, allowing teams to focus on strategic initiatives.

Why Choose AICA?

AICA’s solutions are up to 90% faster than traditional methods, significantly reducing the time needed for data management tasks. Their AI-driven approach reduces the need for manual labor and minimizes errors, cutting down on operational costs.

AICA’s specialized Large Language Models (LLMs) achieve over 80% accuracy, far exceeding the 30% accuracy of general AI models. Their algorithms are specifically trained on MRO product data, ensuring highly relevant and precise data handling.

Furthermore, AICA’s services are highly customizable, allowing you to select specific solutions that address your unique data challenges.

In conclusion

AICA’s advanced AI and ML solutions are well-positioned to help organizations navigate the complexities of integrating generative AI into supply chain logistics. By addressing data quality, integration, governance, and operational efficiency, AICA ensures that organizations can fully leverage the transformative potential of AI in their logistics operations.

We would like to thank and reference Gartner for the information referenced in this article.

*This article is written by USC Consulting Group’s strategic partner in data cleansing and management, AICA. For more information how AICA can cleanse and enrich your product and services data with AI, visit their website.

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Global supply chains are intricate networks that span multiple countries and continents, involving a multitude of processes, from procurement to distribution. The complexity is further compounded by varying local standards and regulations, making standardization a critical need.

The United Nations Standard Products and Services Code (UNSPSC) provides a universal classification framework that is essential for streamlining these complex processes and facilitating seamless international operations.

Benefits of UNSPSC

UNSPSC serves as a global language for businesses, ensuring that products and services are categorized consistently regardless of where they are produced or consumed. This standardization is vital for global trade, as it simplifies communications between suppliers and buyers, enhances spend analysis and reporting capabilities, and improves procurement efficiency.

By adopting UNSPSC, companies can ensure more accurate demand forecasting and inventory management, which are crucial for maintaining the flow of goods and services across global markets.

AICA’s Automated Approach to UNSPSC

Data management and cleansing specialist AICA offers a SaaS platform that leverages advanced AI and ML technologies to automate the UNSPSC classification process. This automation is driven by AI models trained on extensive datasets, significantly increasing accuracy and reducing errors commonly seen in less sophisticated systems.

The process of manually classifying products into UNSPSC codes is a task that traditionally requires substantial time investment. For instance, cataloguing a single product into the UNSPSC framework manually takes approximately 10 minutes. Classifying 10,000 products would, therefore, require about 69 days. Thus, manually classifying products consumes a significant amount of time, representing a substantial opportunity cost.

However, AICA’s platform automates this process and assigns the classified items with an accuracy score. Items that receive a quality score lower than 93% are flagged for review by our subject matter experts.

Here’s a breakdown of the time savings:

• Total manual classification time for 10,000 products: 69 days.
• Time required using AICA’s platform with automated and expert review: Only the items with a quality score below 93% are manually reviewed. This drastically cuts down the overall manual intervention and time needed compared to the traditional method.

Thus, by using AICA’s system, a task that would normally take over 69 days of continuous work can be reduced significantly to only a few.

This methodology not only speeds up the classification process but also ensures a high level of accuracy and reliability, allowing businesses to deploy resources more effectively and enhance overall productivity in the supply chain.

Universal Relevance

The relevance of UNSPSC and AICA’s technological solutions extends across various critical sectors, including Manufacturing, Mining, and Aerospace and Defense. These industries face unique challenges such as managing complex assemblies, complying with strict regulatory standards, and handling high-value inventories.

UNSPSC codes help standardize component classifications, making it easier to track and manage parts across global supply chains. For these sectors, the ability to accurately classify and analyze product data can lead to more strategic sourcing and better risk management.

Conclusion

For global enterprises aiming to improve their supply chain operations, adopting AICA’s UNSPSC-classifying technologies offers a transformative opportunity. By integrating our solutions, companies can benefit from enhanced data accuracy, improved operational efficiency, and a competitive edge in the global market.

*This article is written by USCCG’s strategic partner, AICA Data. AICA is a data cleansing and management specialist that optimizes your product and services data with AI to provide faster, more accurate, and cost-effective solutions. To find out more about AICA’s services – visit their website here.

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