Israel’s Innovation Offers Next-Gen Supply Chain Optimization Solutions

The global impact of climate disruption and geopolitical uncertainty is taking a direct toll on supply chains. However, Israel’s commitment to innovation has helped to offer next-generation solutions that could bring greater security, visibility, and automation throughout every step of the chain to deliver efficiency throughout a wide range of industries.

In the West, the Panama Canal, one of the world’s busiest trade passages, was recently forced to limit its daily crossings due to the severe drought impacting the region. This serves as a timely reminder of the far-reaching climate impact on supply chains and their vulnerability amid changing environmental ecosystems.

Likewise, changing geopolitical environments have also posed more challenges for global supply chains as uncertainty brings more inefficiencies to the fore at many different stages of production and distribution.

The rise of extreme climate events alone have pushed supply chains towards breaking point. According to data compiled by Cervest, the projected cost of environmental risks in supply chains stands at USD $120 billion by 2026.

Although it’s clear that a major challenge lies ahead to keep supply chains running smoothly amid widespread disruption, Israel’s innovation hubs offer fresh opportunities to bring optimization to the struggling industry–and positive change is already in development.

Tel Aviv’s Startup Ecosystem Delivers on Cybersecurity

Although Israel’s startup investment was lower in 2023, with a tally of $3.2 billion in the first half of the year that weighed in at 73% lower than the same period in 2022, the nation remains a global leader in producing high potential startups at an unrivalled rate per capita.

With 9,000 active startups in Israel, innovation has remained a significant factor in the nation’s GDP. In fact, in venture capital funding alone, Israel’s startups brought $95 billion into the country.

One area in particular that Israel excels in is cybersecurity. Although funding raised by cybersecurity firms fell 43% to $2.4 billion in 2023, the industry remains a leader in the development of digital security solutions across a wide range of industries.

At a time when environmental and geopolitical frailties are already impacting supply chains, it’s essential for businesses to secure their networks to ensure cybercriminals don’t take advantage of the industry uncertainty to steal sensitive data.

According to Consultancy, 2023 saw the emergence of supply chain hacks as criminals seek to take advantage of third parties to gain access to valuable information and customer resources. Recent hacks including those targeting access management provider Okta, which saw customer data become exposed across a range of parties throughout its supply chain.

“These recent hacks are a microcosm of why supply chain hacks are so effective,” explained AJ Thompson, Northdoor CCO. “One successful breach into a company can gain access to multiple companies’ data, often without the end victim knowing that they’ve even been attacked.”

Fortunately, we’re already seeing Israeli firms offer solutions throughout the sector, and wider supply chain management can become more secure by accommodating the technology used by firms in securing software supply chains on a global scale.

One example can be found in Tel Aviv firm Legit Security, which automatically discovers and secures pipelines, infrastructure code, and users while continually auditing applications and updates.

The company, which excels in application security posture management (ASPM), utilizes artificial intelligence to generate a secure ecosystem for all supply chain participants, and illustrates how wider chains can be secured online against vulnerabilities.

Legit Security is by no means Israel’s only cybersecurity firm that can be geared towards software supply chain management, and fellow Tel Aviv firm OX Security recently secured investment from IBM Ventures to continue building value-driven cloud-native solutions in supply chain management.

The reasons that the growth of these firms can directly improve supply chain management in disruptive circumstances is because they can directly facilitate the digitalization of supply chains and improve visibility throughout every stage of the chain.

For firms that need to optimize payments solutions to manage vendors effectively, these cybersecurity measures can combine with automation tools to manage vendors payouts using integrated software.

It’s this integration that can combine with the development of artificial intelligence and blockchain solutions to keep businesses more in-touch with their supply chain partners than ever before, and with an unprecedented level of security to boot.

Delivering Automation at Scale

Israel also leads the way in driving supply chain automation throughout every step of the chain. In fact, the nation’s leading startups have been drawing praise from tech leaders like Elon Musk.

Footage of Sderot-based BionicHIVE’s SqUID robots autonomously navigating warehouse floors and using suction cups to retrieve boxes before distributing them prompted Tesla CEO Musk to claim that “the robot future is coming.”

BionicHIVE sought to develop its fleet of SqUID robots as a means of generating supply chain resilience in the wake of the post-pandemic boom in eCommerce, which caused shortages in warehouse workers and underlined the necessity of digital transformation within the industry.

These demands are likely to become more fierce at a time when environmental and geopolitical strains are forcing businesses to look in the same place for suppliers while driving up demand in certain sectors as supply squeezes render others ineffective.

By using built-in cameras, SqUID robots can recognize and avoid both static and moving objects while using sensors, computer vision, and artificial intelligence to aid human warehouse workers in a manner that saves time and delivers far greater efficiency for vendors.

Another leading Israeli startup, Nanovel, has been actively improving supply chains outside of warehouse confines. By utilizing a similar blend of automation, computer vision, and AI, the company has created a citrus-picking robotic arm that accurately grips, snips, and harvests ripe organes from orchards.

By combining the arm with a tractor, Nanotel has provided firms with a glimpse of how future harvests could look as climate change presents new challenges to supply chains.

This is because these mobilized bots can bring efficiency to crops en masse that may struggle with their respective yields. Using computer vision, this automation can actively conduct on-the-fly quality control for expansive crops to ensure that they can continue producing even as the wider environmental landscape becomes less reliable for farming.

Offering Answers for Tomorrow’s Questions

Although factors like climate change and geopolitical uncertainty may bring more supply chain disruption in the future, the innovations developed by Israeli startups are set to deliver unprecedented levels of convenience, transparency, and efficiency to an industry that’s particularly vulnerable to issues.

The emergence of automation, artificial intelligence, and computer vision are set to become a driving force in driving the digital transformation revolution for supply chain management.

Israel’s commitment to innovation has helped to turn Tel Aviv into one of the world’s busiest tech hubs, and the nation’s strides in the field of cybersecurity are set to offer more opportunities for optimizing supply chains on a physical and digital level.

Even at a time when funding has dipped, Israeli firms are continuing to position themselves as a driving force in answering the environmental questions of tomorrow, and the develop of its leading startups can help businesses to reap the benefits on a global scale.