Over the last three years, the global supply chain faced a host of disruptions, from the pandemic, rising inflation, climate change, historic geopolitical events and unstable financial markets. Business today is anything but usual—and this is especially true in supply chains, where it’s no longer a question of if a major disruption is coming, but when.
The ripple effects of these developments have been felt far and wide, and Middle East and Africa have not been exempted - with customers (46 per cent), investors (55 per cent) and board members (47 per cent) demanding greater transparency around sustainability from organizations. Fifty-four per cent organizations are looking to aggressively move towards being carbon neutral.
To counter these effects, the region has renewed its focus on initiatives to build supply chain resiliency and diversify supply lines. In the Middle East, some countries have a full-fledged international logistics infrastructure, whilst in Africa, the Africa Union (AU) has launched the African Continental Free Trade Area (AfCFTA). These initiatives are aimed at strengthening regional supply chains and bolstering their competitive advantage.
As such, regional economies are looking to Chief Supply Chain Officers (CSCOs) to improve the competitive advantages of regional supply chains. A new report by the IBM Institute for Business Value (IBV) collected insights from 1,500 surveyed CSCOs, including Middle East and Africa. According to the report, CSCOs are helping their organizations differentiate by using data and AI to improve their supply chains, build competitive advantages, drive profitability, and increase revenue over their industry peers. Hybrid cloud (45 per cent), AI and machine learning (54 per cent) are believed by Middle East and Africa CSCOs to help deliver results for supply chain organization needs.
Preparing for ‘now’ to ‘next’
Across the spectrum, CSCOs have adopted a steady-as-they-go emphasis on automation, AI and intelligent workflows, ecosystems, and sustainability. Globally, corporations that align their digital and sustainability transformation agendas achieve 20 per cent higher revenue growth when compared to their peers, the report reveals.
CSCOs are seeing a clear competitive advantage because of these investments, from a top-line and bottom-line perspective. They’re also getting a differentiated proposition to attract top-tenured talent and early professional talent.
In MEA, nearly 62 per cent of surveyed CSCOs are accelerating investments in digital technologies, including increasing automation and digitization of physical and asset-driven processes. Fifty-four per cent believe that sustainability investments will accelerate business growth, and 45 per cent are applying open innovation with business partners.
In addition, 41 per cent are exploring new risk models; 53 per cent are taking a cutting-edge approach to data-driven innovation, including employing predictive approaches; and 48 per cent are implementing tech-infused workflows.
Transformational technologies
Using transformational technology investments, CSCOs are managing their supply chains to drive powerful results. They ratchet up tech strategies and adopt a data-driven innovation approach that emphasizes the scaling of a hybrid cloud infrastructure, AI-enabled workflows, customer-focused sustainability and a deeper focus on cybersecurity.
These CSCOs globally make up the Top 20 per cent of those surveyed, also known as the ‘innovators’.
Innovators are edging out other CSCOs by embracing digital transformation. They use hybrid cloud platforms 56 per cent of the time, versus 49 per cent among their competitors. Innovators also lead the field with digital infrastructure that enables new technology investments to scale efficiently and deliver value.
They use digitalization and AI automation 95 per cent more than their peers. Ninety per cent of Innovators use AI and advanced analytics in demand management and predictive forecasting, which is 18 per cent more than their peers.
When it comes to the most important business objectives of sustainability initiatives, CSCOs in MEA surveyed listed improving customer engagement and commitment (60 per cent), compliance with environmental regulations (54 per cent) and driving innovation areas (54 per cent).
The results highlight the importance of innovative CSCOs who prioritize digitalization for efficient end-to-end visibility and dynamism. In short, if you want to increase performance and value, data-driven innovation is your journey.
