Governments, business owners, and entire industries are reevaluating everything they thought they knew about the supply chain. With the effects of the pandemic revealing gaping holes in the global supply chain and presumed best practices, stakeholders are thinking outside the box toward solutions that can enable them to master supply chain management, and in so doing, improve customer satisfaction.
The metaverse may be that solution. The metaverse has become quite the buzzword in society’s lexicon these days, even though the term itself was coined in the early 1990s by a fiction writer. Yet many people are still not well versed on what it means. According to an Ipsos survey done earlier this year, fewer than one in five Americans are able to correctly explain it, and only around 40% are familiar with the terminology.
While the technology may still be in its infancy relative to technologies that preceded it, the incredible potential that the metaverse holds when it comes to improving logistics, manufacturing, and other business needs suggests the metaverse could be a major game changer for the physical world in general and business owners in particular.
What is the metaverse all about?
The metaverse, as defined by Merriam-Webster, is a digital environment where users can interact with one another in a variety of ways, all within a computer-generated world. Although the metaverse is often thought of as a specific technology, it is more accurate to think of the metaverse as a combination of existing technologies that are creating a new capability or application. The primary technologies it is composed of are virtual reality and mixed reality. While these are often thought of as synonymous with one another, there is a subtle difference between the two. Virtual reality is a medium that requires headsets or special electronic equipment for people to interact with a computer-generated environment. Mixed reality, on the other hand, is the blending of the physical world with the virtual world, thereby making the latter a tool for the former — an augmented reality, as it is also known.
How is the metaverse different from virtual reality?
Virtual reality, much like the term “metaverse,” is not new. Since its inception, it has largely been associated with entertainment uses, wherein gamers can temporarily “escape” from the physical world into a digital world, saving cities from villains as comic book superheroes or leading a professional football team to a come-from-behind overtime victory.
While the metaverse can be used for gaming purposes, it also serves as a persistent digital world where more long-term engagements can take place, for both business and personal use. In addition to major tech companies — such as Meta (formerly known as Facebook), Google, and Nvidia — numerous household-name corporations have invested in the metaverse. They recognize it for what it is: a business opportunity that can fuel growth and improve upon what currently exists. Here are a few of the companies that have metaverse projects in the works or already in place, according to Tech.co and The Metaverse Insider:
Investments from industry titans like these help explain why the metaverse universe is poised to be worth as much as $824 billion by 2030, up from $21 billion in 2020, according to forecasts done by Verified Market Research.
Why are so many businesses ‘all in’ on the metaverse?
The metaverse is the quintessential emerging technology; its practical use has a lot of potential, but much of it has yet to be realized. It is this potential, however, that has generated so much business interest. From improving the way the consumer shops online to enhancing employee training in professions where retention is critical, the metaverse has the potential to make existing processes more efficient and effective.
Many business executives and supply chain management professionals hold this same view about the metaverse supply chain: It has promise in ensuring that all of the sequences and processes that are involved in the production of a commodity are done more seamlessly and with greater predictability. This is made possible by simulating the processes within a virtual world first, then applying them to the real world. All these activities transpire within the digital supply chain, which is much like a physical supply chain, but in a computer-generated environment.
How is the metaverse poised to improve existing supply chain challenges?
The worst of pandemic-era supply chain disruptions may be behind us, but supply chains are far from being fully functional or back to normal. In a November 2022 poll conducted by the National Federation for Independent Business, nearly 90% of business owner respondents acknowledged that they had been at least somewhat adversely impacted by an underperforming supply chain, with nearly a third of respondents saying the effects were significant.
Here are a few ways metaverse-informed supply chain strategies may be able to help businesses revolutionize supply chain management:
By its very nature, the supply chain involves many stakeholders, each united toward a common product-based goal. Since the metaverse is a shared space where all stakeholders can connect and share ideas, it promotes collaboration and communication, both of which are key to a thriving and durable supply chain. Streamlining collaboration can help shorten the product lifecycle, so goods can be developed and delivered to end users more quickly. A shorter supply chain also reduces the risk of disruption since there is a shorter window of time between product development and delivery.
Simulate warehouse processes
In the world of retail — be it brick and mortar or e-commerce — the warehouse represents a significant component of the supply chain. Virtual warehousing facilities are possible inside the metaverse. Customized to resemble the physical world version, virtual warehousing facilities make it possible to try out certain processes and workflows, test their results, and then apply those same flows to the physical world. Instead of trying to visualize scenarios in one’s mind or via computer software, the metaverse makes it possible in a more natural, visual way, leaving less to chance.
Map out an entire supply chain network
Depending on the product or item, there are numerous processes that have to take place before it reaches the consumer, business, or some other end-user. The metaverse makes end-to-end supply chain network mapping a reality, albeit virtually. From farmer to shopper or from miner to jeweler, the metaverse can map out all of the “players” within a supply chain network. And instead of simulating only warehouse processes, the metaverse can simulate those that occur before and after the warehouse. For example, how might extreme drought affect farmers’ staple crops, such as wheat or corn? How would those impacts (e.g. reduced quality, lower quantity) influence the other members of the supply chain network?
Improve the quality of data
Decisions are influenced by data, but those decisions can be compromised if data is faulty, inaccurate, or incomplete. Because the metaverse supply chain leverages artificial intelligence to synthesize data — without the assistance of human input, which would make it prone to error — it has the potential to improve the quality of that data, thereby making it easier to predict events before they occur. This can help with business functions like demand forecasting or lead times, which are important to logistics, manufacturing, and other supply chain activities.
Inspirage provides transformational services that can fuel your business and achieve your long-term goals. One of our specialties is supply chain management. For more information on how we can help your company thrive through digital transformation and our Oracle-based software solutions, contact us today.