RECONFIGURE AND REDESIGN

It is hard to understate the importance of supply chain efficiency for large and growing economies, particularly India. An efficient and sustainable supply chain management system is one of the key factors for economic growth. An effective supply chain directly translates into competitiveness across economic sectors through lowered input costs. The Machinist takes a closer look…

- Rahul Kamat

India’s supply chain and logistics sector is one of the largest globally, with a logistics industry of USD 215 billion and growing at a CAGR of 10.5 per cent. However, despite its size and criticality to economic growth, India’s supply chain is marred by an unbalanced logistics modal mix, high indirect costs, poor infrastructure, fragmented networks, and lack of technology adoption. The COVID-19 pandemic has accentuated supply chain weaknesses, with nearly 75 per cent of companies worldwide experiencing disruptions. Worse still, most companies have reported a lack of any contingency plan to deal with a problem of this magnitude.

One of the biggest revelations of the pandemic for this sector is the urgent need to leverage disruptive technologies for greater resilience. In India, the pandemic has accelerated digital adoption on the demand side. This stemmed from the unprecedented demand faced by online grocery providers, which forced them to limit access for existing consumers in April and May 2020. These disruptive events pushed decision-makers to reimagine the country’s supply chain management.

This is the moment for the Indian supply chain and logistics sector to reconfigure and redesign supply chains with greater thought too disruptive technologies and risk management, especially considering the resilience required in the manufacturing sector.

TECH-ENABLED SUPPLY CHAIN ARCHITECTURE