Operations transformation and management
PwC's operations consulting helps business operation management through tech-driven transformation, focusing on supply chain efficiency, agility, and innovation.
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Insights from PwC’s 2023 Digital Trends in Supply Chain Survey
As companies explore how better use of technology can help improve supply chains, efforts to build resilience and reduce risk have lagged behind other initiatives. Just 34% of operations leaders in our 2023 Digital Trends in Supply Chain Survey cited increased resilience as one of their top objectives when investing in supply chain technology. In addition, 86% agreed or strongly agreed that their company should invest more in technology to identify, track and measure supply chain risk.
The findings track with our experience that many companies either find the concept of resilience too vague or take for granted that their supply chains have adequate digital capabilities to maintain operations during delays and other obstructions. In addition, many don’t recognize that risk mitigation by itself isn’t a business continuity plan, and that investing in resilience better enables you to “look around the corner” versus simply responding to immediate threats.
The vast majority of operations leaders aren’t prioritizing resilience in supply chain tech investments
Q: What are your top priorities for the next 12-18 months? (Rank up to 3 from 13 choices; percent who selected this as the top priority.)
Q: Which of the following are your main objectives when investing in technology for your supply chain? (Rank up to 3; percent who selected this as the top objective.)
Source: PwC 2023 Digital Trends in Supply Chain Survey: base of 305
Q: Which of the following are your main objectives when investing in technology for your supply chain? (Rank up to 3; percent who selected this as the top objective.)
Source: PwC 2023 Digital Trends in Supply Chain Survey: base of 305
How companies are building resilience and managing risk in supply chains
Increasing resilience trails other priorities and objectives
When asked about their priorities in the next 12-18 months, only 23% of survey respondents chose increasing responsiveness and resilience among their top three. By comparison, more than half picked increasing efficiency (58%) and reducing costs (54%) as top priorities.
That tepid response is understandable considering many supply chain leaders have been putting out fires after recent disruptions, but shifting your resilience strategy from short-term risk mitigation to long-term stability is critical for growth. Driving growth was the most commonly named top objective of supply chain technology investments at 53%, but only 34% said increasing resilience — suggesting many executives aren’t connecting resilience to growth.
Industries vary on increasing resilience as a main objective of supply chain tech investments
Q: Which of the following are your main objectives when investing in technology for your supply chain? (Rank up to 3; percent who selected ‘increase resiliency’ as a top 3 objective)
Source: PwC 2023 Digital Trends in Supply Chain Survey: base of 305
Source: PwC 2023 Digital Trends in Supply Chain Survey: base of 305
Where you go from here
Is your company ready to be smarter in using technology to reduce risk and help improve resilience in the supply chain? Consider these actions as potential next steps.
- Pivot from short-term risk mitigation to long-term stability. Current disruptions should be managed, of course, but supply chains are less likely to thrive with a crisis-to-crisis approach. Determine what changes to operations networks and supply chain footprints should be made now to allow the long lead times required to identify and close organizational gaps in supply chain capabilities.
- Find the right global-regional balance. Geopolitical and policy shifts, which sometimes occur rapidly, can challenge long-established networks with choke points, delays and other inefficiencies. Assess where you can be proactive and insulate your operations with more geographic diversity in sourcing and distribution.
- Include impairment planning in supply chain decisions. Broader trends also can impact specific assets in your supply chain — not only disrupting them but affecting their remaining useful life and value to your organization. Anticipating these impacts can minimize the risk of wasted capital.
- Build R&D and product development capacity to fuel growth. The rise of connected products and services brings a new dimension to the skills and capabilities needed in supply chains. Determine which elements of your supply chain can benefit from increased investment in innovation instead of just short-term efficiency.
- Embrace AI … without losing the human element. Artificial intelligence and machine learning already have improved agility and responsiveness in supply chains, but in many cases they’ve yet to become integrated into business planning. Refine your AI/ML strategy with the goal of leveraging both the technology and your teams — with digital upskilling as needed — in managing supply chain risks.
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