Unmanned Aerial Vehicles in Supply Chain Management: Analysis and Implications

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Table of Contents

Introduction
UAV Application
Advantages of UAV Application
Disadvantages of AUV Application
Implications and Conclusion
References

Introduction

The process of automatizing manufacturing has become an irreversible phenomenon across all business segments. The digital shift has been especially relevant for the operation of supply chain management (SCM) within an enterprise. According to Wieland (2021), SCM stands for a network of interdependent parties that collaborate in order to satisfy consumer demand. Thus, it is reasonable to assume that while the end goal of the SCM is positive customer outcomes, the adoption of technology is an unavoidable endeavor to secure relevance and advantage in the competition.

Such a perception of optimizing communication between the parties involved has led to the introduction of a digital supply chain (DSC). According to Büyüközkan and Göçer (2018), DSC is defined as “a smart, value-driven, efficient process to generate new forms of revenue and business value for organizations and to leverage new approaches with novel technological and analytical methods” (p. 157). One of the most frequently discussed contributors to this process is an Unmanned Aerial Vehicle (UAV), or drone, which stands for an aircraft controlled without human involvement on board (Büyüközkan & Göçer, 2018). Despite the challenges that exist in the way of mass UAV application to the SCM, its adoption is nowadays an unavoidable process that needs to be optimized and embraced by management worldwide.

UAV Application

The 21st century is marked by the mass implementation of automated technology and drones, in particular, to all aspects of human life. In the book by Kille, Bates, and Lee (2019), the authors estimated that the commercial market using UAVs was valued at nearly $130 billion. Hence, it becomes evident that many business owners worldwide view the value of implementing drones into their SCM structure.

While people imagine that the application of drone technology is limited by enhanced delivery options for the supply chain, the scope of UAV efficiency is currently tested in other areas. Thus, the first way of UAV application within the SCM is through warehouse inventory and maintenance. Nowadays, drones are widely incorporated in warehouse supervision, as the technology allows for conducting inventory, security surveillance, visual inventory audits, and stocking and delivering goods that are difficult to reach by employees (Companik, Gravier, & Farris II, 2018). Moreover, warehouses are the most hazardous working environments across the SCM, so automation of such risky endeavors as conducting inventory in hard-to-reach areas of the area is a benefit to employee safety.

As far as the delivery is concerned, the application of UAVs is motivated by two major factors: time- and cost-efficiency. While many SC managers are intimidated by the costs of DSC adoption, the long-term outcomes of such an investment allow for saving money on final mile deliveries and truck maintenance costs (Frachtenberg, 2018). By allocating finance to the optimization of drone technology, including battery improvement, control software, and a weight capacity of a drone, companies can apply UAVs to perform both final mile deliveries to trafficked urban areas and remote rural locations. Having taken into consideration the trends of UAV application in the SCM, it can be concluded that the process of drone implementation, due to its evident potential, will be halted anytime soon.

Advantages of UAV Application

Drone technology implementation worldwide has become so popular with companies because of the apparent advantages to the costs and efficacy of the operations. Thus, according to Rejeb et al. (2021), the benefits of UAV application to the SCM include “support of humanitarian logistics, reduced delivery time, reduced costs, improved flexibility, and increased sustainability.” (p. 1). Indeed, the implementation of drones secures a faster and more efficient approach to delivery. When used instead of conventional methods of delivery involving people-controlled vehicles, UAVs present less liability and the ability for employees to have minimum control over the operations, as all the data, both for inventory and delivery, can be easily accessed on remote storage and GPS devices. Moreover, the shift from traditional delivery transport to the use of drones is a step towards ensuring sustainability across the SCM, as the companies tend to reduce their carbon footprint. To summarize, the adoption of UAV technology provides stakeholders with various opportunities, as it saves time and money while expanding the radius delivery and enhancing the quality of inventory maintenance.

Disadvantages of AUV Application

Despite the existing interest in drone technology, its actual implementation is not as common due to the risks and disadvantages associated with UAV delivery. The first and most common pitfall of UAV adoption is the pressure of government regulations (Büyüközkan & Göçer, 2018). With the existing drone regulations presented by the Federal Aviation Administration, any UAV should always remain in visible proximity to the one responsible for vehicle control (Rejeb et al., 2021). Such a requirement limits the distance capacity and affects one of its major advantages.

Another disadvantage of AUV implementation is the external factors, such as weather issues, that impact the drone’s ability to navigate and deliver the product. Weather extremes tend to disrupt the GPS signal, visibility, and integrity of the product. Hence, the full transition to drone delivery, at this point, is nearly impossible. Privacy and misidentification concerns are also relevant to the issue of AUV implementation, as the technology itself is not currently capable of performing final mile deliveries directly to the customer, creating a delivery gap that increases the risk of theft and non-delivery complaints from customers. The issue of privacy is concerned in the case of aircraft drone routes that capture sensitive data of other individuals, so it is important to make sure that the data is not accessed by third parties. Other issues, according to Rejeb et al. (2021), including organizational and technical challenges. Indeed, prior to implementing this technology, many SC managers need to define the organizational framework for implementing drones, which includes hiring a team of professionals to control and operate the technology.

Implications and Conclusion

Considering both positive and negative aspects of AUV’s introduction to the SCM, it is reasonable to assume that the current SCM environment no longer has the option of dismissing the existence of drone technology as an integral part of delivery, security, and maintenance across the supply chains. For this reason, the existing barriers to AUV application should be addressed by the global market in order to eliminate as many drone-oriented risks as possible. Apart from the existing challenges, such as federal regulations and quality control, AUVs present a series of unique advantages to the SCM, encouraging the system to focus on more customer- and quality-oriented issues for the staff. In order to secure this shift, companies should work with ways to automate the supply chain processes like storage and final mile delivery.

References

Büyüközkan, G., & Göçer, F. (2018). Digital supply chain: Literature review and a proposed framework for future research.Computers in Industry, 97, 157-177. Web.

Companik, E., Gravier, M. J., & Farris II, M. T. (2018). Feasibility of warehouse drone adoption and implementation. Journal of Transportation Management, 28(2), 5. Web.

Frachtenberg, E. (2019). Practical drone delivery. Computer, 52(12), 53-57. Web.

Kille, T., Bates, P. R., & Lee, S. Y. (Eds.). (2019). Unmanned aerial vehicles in civilian logistics and supply chain management. Pennsylvania, US: IGI Global.

Rejeb, A., Rejeb, K., Simske, S. J., & Treiblmaier, H. (2021). Drones for supply chain management and logistics: a review and research agenda. International Journal of Logistics Research and Applications, 1-24. Web.

Wieland, A. (2021). Dancing the supply chain: Toward transformative supply chain management.Journal of Supply Chain Management, 57(1), 58-73. Web.

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