Although logistics and supply chain management impacts our lives on a daily basis, many of us take it for granted. At least we did until a host of factors threatened to grind it to a halt in recent years. The truth is that the supply chain didn’t just invent itself, it’s the result of hard work, innovation, and evolution that dates back more than three millennia. Let’s take a look back at the history of the supply chain as well as a peak forward at the future.
Supply Chains Bronzed Up the Bronze Age
One of the key ingredients in the Bronze Age was … bronze! A key ingredient in bronze is tin, which may have moved great distances as it traveled from herders and villagers in Central Asia and Southern Turkey to states and rulers with proximity to the Mediterranean some 3200-3650 years ago!1
This is the conclusion reached by a group of academics who recently studied the cargo found on a shipwreck off the coast of Turkey that was discovered in 1982. While most of human history consists of hunting and gathering, this finding indicates a leap forward in logistical strategy. It also serves as a prelude to the important role supply chains would play in empires, a dynamic that continues to play out in headlines to this day.
The Industrial Revolution Spurs Economic Activity
Despite the aforementioned example and the creation of other trade routes, most supply chains remained regional until the Industrial Revolution shook things up in the late 18th and early 19th centuries.
New machinery and factory processes greatly increased output. The adoption of the locomotive would eventually make the large-scale transportation of goods more feasible. Quality of life would rise for some, though certainly not for all, in Europe and the Americas.
Even though the term had yet to be coined, supply chains were taking shape and impacting commerce, and, indeed, history itself.
Trucking, Warehousing and the Logistics of War in the Early 20th Century
By the year 1900, thanks to the combustible engine, cars and even semi trucks were on the road.2 This set the stage for a century of technological and logistical breakthroughs.
These vehicles enabled greater and more fluid movement of goods. Henry Ford’s revolutionary assembly line ramped up manufacturing output in 1913.3 Pallets led to greater efficiencies in warehouses.2
Logistics and supply chains were a growing focus, particularly in World War 2. Moving goods, weapons, military equipment, and even soldiers themselves required much strategizing. Some even credit the victory of the Allies on D-Day to superior logistics.4
Shipping Containers Make Handling Goods Easier
In 1956, an American truck company owner named Malcom McLean invented and patented the standardized shipping container.5 This seemingly straightforward step created great time and economic efficiencies for those handling goods.
The containers could be carried by rail, truck, or ship. Warehouses became more effective at loading and unloading them. It’s considered to have been a great leap forward in logistics.
Digital Technology Paves the Way for Globalization
’IBM developed the first computerized inventory management and forecasting system in 1967.’2 This set in motion a technological evolution in supply chain management that continues to this day.
The eventual proliferation of personal computers and spreadsheets allowed for better data analysis and the optimization of routing, inventory management, and procurement. Expertise in the field flourished. Warehouse management systems (WMS) and enterprise resource planning systems (ERP) eventually became the norm.
Globalization
These efficiencies, coupled with increasing political will, allowed for ever-expanding international trade. Globalization became a double edged sword. Complex ecosystems contributed to the delivery of everyday goods and more goods became available to more people than ever before. In the process, national economies were impacted for the better and worse.
Technology Creates Supply Chain Transparency
Just as technology has enabled greater transparency for those navigating supply chains, so, too, has it increased visibility for conscious consumers. Social media and other platforms have given the public a greater ability to share information regarding companies and their practices throughout their supply chain. Those deemed insufficient in their efforts regarding global warming, worker’s rights, and other social issues are paying the price with decreased market shares. As a result, many companies are using technology to track, improve, and tout their efforts in this regard.
Today: Peak Globalization?
While supply chain efficiency-building has never been a smooth road, it has generally maintained a trajectory toward progress. Recent events, however, threaten to upend that momentum.
The Covid-19 pandemic impacted manufacturing and transportation efforts around the world. Geopolitical tensions, natural disasters, and human rights violations only added to the problem.
While globalization is still very much in effect, some organizations have begun to trend away from worldwide, just-in-time inventory models towards more cautious and geographically condensed strategies. Apple is just one example of a company that has taken this approach. While they still remain very active in Asia, they’ve increased their reliance upon American facilities and manufacturers.6
Whether this is a temporary blip or a new long-term trend remains to be seen.
The Future of Supply Chain Management
While the international (or even interplanetary?) future of supply chain management remains in question, there is no doubt that human ingenuity and technology will be guiding forces.
Customer facing portals are already creating greater transparency for those utilizing the services of third party logistics companies. AI and machine learning continue to allow for better optimization capabilities. Industry 4.0 spurs the imagination with a ‘sky’s the limit’ ethos.
While the supply chain has a long and inspiring history, it’s one that’s undoubtedly still unfolding.
Cited Sources
1 Bower, Bruce. “Complex Supply Chains May Have Appeared More than 3,000 Years Ago.” Science News, January 9, 2023. https://www.sciencenews.org/article/supply-chains-3000-years-bronze-age-shipwreck.
2 “The History and Evolution of the Global Supply Chain – Blume Global.” Blume Global – Supply Chain Solutions, May 7, 2021. https://www.blumeglobal.com/learning/history-of-supply-chain/.
3 “The Moving Assembly Line and the Five-Dollar Workday.” Ford Corporate. Accessed January 12, 2023. https://corporate.ford.com/articles/history/moving-assembly-line.html.
4 Mall, Scott. “Freightwaves Classics: D-Day Logistics Helped the Allies Win World War II.” FreightWaves, June 6, 2022. https://www.freightwaves.com/news/freightwaves-classics-the-logistics-of-d-day-helped-the-allies-win-world-war-ii.
5 Services, PLS Logistics. “The History of Shipping Containers.” PLS Logistic Services, January 10, 2023. https://www.plslogistics.com/blog/the-history-of-containers/.
6 Orr, Andrew. “Apple Is Tentatively Stepping into More Manufacturing in the US.” AppleInsider. AppleInsider, October 4, 2022. https://appleinsider.com/articles/22/10/04/apple-is-tentatively-stepping-into-more-manufacturing-in-the-us.