IT Subway Map Europe 2023: Supply chain software boosted by AI and CO2

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The rising European demand for supply chain software is being driven by rapid advancements in artificial intelligence, including the sudden emergence of ChatGPT, as well as legal obligations to reduce carbon emissions. Ongoing demand volatility means that software vendors are seeing the greatest demand for forecasting and demand planning solutions. These are the key observations from the annual survey and research by Supply Chain Movement for the 13th edition of its SCM IT Subway Map Europe.

By Martijn Lofvers

In the space of just 12 months, French software vendor Sweep, founded in 2020, raised a staggering €100 million in capital for its sustainability solution to decarbonize businesses. Its UK competitor Pledge recently raised a further ten million in funding for its platform that allows companies to measure, report, reduce and eliminate their Scope 3 carbon emissions. The strong investment interest in vendors of such software is a direct consequence of European legislation that will require publicly listed companies to report on and improve their sustainability performance from 2024 onwards. Meanwhile, the Lieferkettengesetz (Supply Chain Act) has been in effect in Germany since 1 January of this year. This law makes companies of a certain size responsible for human rights compliance and also for transparent upstream traceability in global supply chains.

Costs versus carbon emissions

The pressure to improve supply chain sustainability means that companies increasingly have to make trade-offs between costs and carbon emissions. Supply chain software vendors are responding to this by offering the functionality to express transport movements in terms of carbon emissions as well as costs. Transporeon acquired German start-up Tracks for this reason in autumn 2022. Incidentally, Transporeon itself has since been acquired by American software company Trimble. Similarly, since acquiring the company called Starboard, software vendor Logility offers a supply chain digital twin solution that can calculate the optimal network based on cost and carbon. Its Canadian competitor Kinaxis, which is also a dominant player in Sales & Operations Planning, took over the Dutch-based company MPO, a provider of transportation & order management and supply chain execution, in mid-2022.

In addition to exploring opportunities for potential acquisitions, supply chain software vendors are increasingly adopting artificial intelligence. Belgian scale-up Garvis has integrated the chatbot ChatGPT – plus the necessary encryption technology – into its forecasting and demand sensing solution. This allows nontrained users to ask the application questions and receive answers (including graphs) in easy-to-understand language. According to a survey of 42 European software vendors, forecasting and demand planning is the most frequently requested type of solution.

Unshackled from the ERP

Companies using supply chain software have a growing need for applications that support their flexibility. Large multinationals in particular feel tied to their ERP and therefore a single vendor (usually SAP). As recommended by consulting firm McKinsey in a recent article, to cast off these shackles companies need a data layer such as Microsoft Azure. The abovementioned acquisitions are reflected in the 13th edition of the SCM IT Subway Map Europe, and so too are the new entrants, including Colibri, Lokad and Wakeo from France. Software vendors have been assigned a number of subway stations visualizing their proven expertise in Europe, based on their own input – including about the number of live customers in Europe and the percentage of sales by software type – and research by Supply Chain Movement’s editors. In addition to the SCM IT Subway Map in this magazine and on the accompanying poster, Supply Chain Media has also developed a clickable online version for the European software market:

The poster is available in the webshop >>

Download: SCM IT Subway Map Europe 2023