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Future of Supply Chain: Three Contrarian Predictions

[fa icon="calendar"] Oct 3, 2017 4:52:58 AM / by Amandine Pham

This week SCM World launches the annual Future of Supply Chain survey.

To begin with, here are three long-range, contrarian predictions that should matter to supply chain professionals:

1. Fall River Rising — This week’s Wall Street Journal featured an article on job creation and automation titled “Workers: Fear Not the Robot Apocalypse.” The hidden story behind that headline, however, is: the rise of secondary cities such as Fall River, Massachusetts, whose industrial past left behind a core of decent buildings and a workforce plenty suitable to new economy ventures. Amazon is ramping up hiring in a fulfillment center there and breathing new life into the city.

A piece in Forbes offers a similar angle for entrepreneurs looking to avoid high costs in places  such as Chicago. At the same time, new demographic data shows a shift away from big U.S. cities for the first time in years.

Growth rates in rimary cities vs suburbs

This view runs counter to the conventional wisdom of a megacity-filled future, in part because it looks primarily at the industrialized world rather than at developing economies, which are often still emerging from agrarianism.

For supply chain professionals the implications are about network topology, job design and materials management.

Prediction: Secondary cities will thrive, as internet connectivity and cost-of-living disparity tip new household formation away from big cities such as New York, Chicago and San Francisco.

 

2. Africa Booms — Africa believers  have been wrong in the past. That said, it is hard to ignore the basic demographics of a massive continent that is expected to number 3.5 billion people by 2100.

UN's World Population Projection

At the moment, things seem to be worsening in Africa, with environmental, political and cultural crises driving migration northward. Meanwhile, critical states like Nigeria, South Africa, Egypt, and the Democratic Republic of Congo struggle to fulfill the promise of Nelson Mandela and the end of apartheid. Still, I cannot help but see a light at the end of the tunnel.

For one thing, the recent Supreme Court invalidation of Kenya’s August 8 presidential election shows that democracy and the rule of law are alive in Africa. The October 17 re-run will be intensely scrutinized, but the fact of judicial independence should give comfort to all.

Beyond this prerequisite for economic success Africa holds plenty of promise for supply chain leaders. As a market, its use of electronic money and wireless communications should help tap millions of underserved consumers. As a supply base, its material and human wealth await only better infrastructure to engage. All of this portends business growth.

Prediction: Africa will be your most important growth market within 20 years.

 

3. The Arts Employ the Masses — Of all my predictions, this one gets rejected most consistently. And yet, the mechanics of the supply chain we are building all point to great opportunity in the arts.

It starts with the inescapable fact of rapidly rising material productivity. Everything from clothes to cars to food is being produced and delivered faster and more cheaply today than ever before. It may explain why we have no inflation and why so many worry about a jobless future. Meanwhile, earnings for writers, musicians and other artists are under siege in the wild west of the internet.

Often overlooked however, is the rise of increasingly precise content targeting. Google, Facebook, Apple and now also Verizon, Disney and even Nike are all honing their ability to serve exactly what we care about at exactly the right moment. Our devices continue to improve the experience of consuming pure content, while at the same time soliciting content contributions in return. On platforms such as Instagram and SoundCloud the consumer is also the producer.

For supply chain leaders the lesson here is about embedding art in science. After all, doesn’t everyone have something creative to offer?

Prediction: Pure content and creative work will dominate manufacturing and unskilled services by midcentury.

The future is what we make it.

 

SOURCE: https://www.forbes.com/sites/kevinomarah/2017/09/07/future-of-supply-chain-three-contrarian-predictions/#a2cf275741e9

 

Topics: Industry News

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