How Automated Supply Chain Supercharges ROI
Tags: productivity, automation, news
Published: 2024-04-26 11:26:03

The logistics industry is a fierce battleground. Customers expect faster deliveries, lower prices, and flawless tracking. At the same time, businesses face rising costs, from fuel and labor to warehouse space and transportation. In this hyper-competitive environment, optimizing efficiency and reducing costs is no longer optional – it's essential for survival. Every dollar invested needs to deliver a measurable return. 

ROI measures profitability, and a strong ROI ensures your company is getting the most value out of its resources, leading to sustainable growth and profitability. By automating manual tasks, leveraging real-time data, and streamlining workflows, automation can significantly supercharge your company's ROI.

## The Bottlenecks of Traditional Supply Chains 

While manual processes have been in the logistics industry for decades, they struggle to keep pace with the demands of today's dynamic market. These limitations act as bottlenecks, hindering efficiency and profitability. Here are some of the key challenges:  

- Human error can occur in manual data entry, picking, and packing. For example, a typo in an order number can lead to delayed deliveries or misdirected shipments. These mistakes cost time and money to rectify, and damage customer satisfaction. 

- Traditional, paper-based systems lack real-time data visibility. This creates a blind spot, making it difficult to track inventory levels, anticipate fluctuations in demand, or identify potential issues before they snowball. 

- Manual processes lead to information silos, where data is fragmented across different departments. This makes getting a holistic view of the supply chain challenging and hinders informed decision-making. Analyzing trends or identifying bottlenecks becomes a time-consuming and laborious task.
 

- Labor might be overallocated to repetitive tasks that could be automated. This translates to wasted resources and higher operating costs. 

## Automating Your Way to ROI Gains

Automation presents a powerful solution to the roadblocks plaguing traditional supply chains. Automation can address these bottlenecks and unlock significant ROI gains. 

**Increased Accuracy**

Automating repetitive tasks like data entry, order picking, and packing reduces the risk of human error. This translates to faster processing times, fewer mistakes, and increased customer satisfaction.   

**Real-time Data**

Real-time data on inventory levels, order fulfillment status, and traffic patterns provides invaluable insights. This allows for proactive decision-making, enabling you to optimize inventory levels, predict demand fluctuations, and identify potential delays before they disrupt your operations. Harnessing a [data-driven](https://www.forbes.com/sites/forbestechcouncil/2024/04/05/supply-chain-evolution-drivers-and-key-trends/?sh=475b95f71c1e) approach enables supply chains to be optimized to meet goals parallel to commercial and resiliency objectives. 

**Optimized Inventory Management and Warehouse Operations**

Automation streamlines warehouse operations by automating inventory tracking, order fulfillment, and picking routes. Warehouse automation solutions like automated storage and retrieval systems (ASRS) can significantly improve space utilization, reduce labor costs, and increase picking and packing speeds. 

**Streamlined workflows**

Automating repetitive tasks and integrating data across different systems creates a seamless workflow. This eliminates delays caused by manual handoffs or information silos. The result is Faster order processing, efficient transportation management, and improved delivery times, which can give you a competitive edge.

## Measuring the ROI of Automation  

After implementing automation solutions in your supply chain, how do you measure the impact of automation on your ROI? Here are some key metrics to track. 

- **Labor Costs:**
 Automation can significantly reduce the need for manual labor, particularly in repetitive tasks.  Track the cost savings associated with decreased labor hours and staff requirements. 

- **Order Fulfillment Speed:**
 Faster processing times and improved picking accuracy translate to quicker order fulfillment. Monitor the reduction in average fulfillment time to gauge the efficiency gains. 

- **Inventory Accuracy:**
 Automated inventory management systems minimize human error and provide real-time data on stock levels. Track the decrease in stock discrepancies and the improvement in inventory accuracy. 

- **Transportation Costs:** 
Optimized route planning and carrier selection through TMS can significantly reduce transportation costs.  Monitor the overall decrease in transportation expenses resulting from automation. 

- **Customer Satisfaction:**
Faster delivery times, accurate orders, and improved communication lead to happier customers. Track customer satisfaction metrics like Net Promoter Score (NPS) to measure the positive impact of automation. 

## Supercharge ROI 
The competitive landscape of the logistics industry demands continuous improvement.  In this dynamic environment, automation presents a powerful strategy for achieving exceptional ROI.  

Automating repetitive tasks, leveraging real-time data analytics, and optimizing workflows helps you achieve increased accuracy and efficiency, improved decision-making, and optimized operations. 

30% of supply chain leaders say that increasing automation will effectively take work out of the system.   

The ROI of automation goes beyond immediate cost savings. It fosters scalability for future growth and builds resilience in your supply chain, ensuring business continuity in the face of unexpected challenges. [Supercharge your supply chain ROI with automated workflows](https://www.isquarebs.com/workflow-automation/).