Supply chains today are integral to building a competitive advantage. As they grow in complexity, those who manage them acknowledge that they do not have as full visibility as they should. Technological solutions can point the way to more visible, better managed, and more efficient supply chains that deliver better value for companies and their customers.
While there is wide variation in the supply chains of various businesses, there are still some identifiable trends. The 2017 GEODIS Supply Chain Worldwide survey (PDF) delves into some of them. The report draws on the responses of 623 professionals in 17 countries from various functions related to the supply chain, including finance, operations, marketing, strategy, IT, and management.
The majority (67%) of people surveyed in a position of supply chain leadership rank as C-Level or top management. This does appear to play some role in successfully strategies because businesses in which that position is help by “a middle manager seem less profitable.”
The top concerns for those who responded to the survey were, not surprisingly, “containment of their costs (32%).” That fits with their awareness of dealing with “global competition (28%).” However, more than half (57%) reported that they see “Supply Chain as a competitive advantage, enabling the development of the company and not” merely an area in which to reduce expenses.
Accordingly, 27% recorded a concern about meeting “changeable customer expectations on quality.” That was closely followed (26%) by those who wish to “improve their capability to reduce delivery times to customers (26%).” Nearly a quarter (24%) also identified a “need to develop a reliable logistics infrastructure.”
What the majority agree on is they have very complex supply chains that lack visibility. In fact, 70% opt for “very or extremely complex” in describing their supply chains. A number of factors contribute to the complexity, including dealing with a variety of transportation modes; 74% use more than four types. The overwhelming majority (79%) also outsource logistics services, working with one or more providers. The complexity is further exacerbated by the proliferation of regulations for different countries, the changes that ensue from mergers and acquisitions, and the increasing delivery demands on the side of customers accustomed to the flow of e-commerce.
At the same time, only 6% claim to have absolute visibility. More than three-quarters (77%) concede that they have “either no visibility or a restricted view.” At a more granual level, it breaks out as:
- 62% have limited visibility (1 to 2 steps).
- 17% have extended visibility (3 to 4 steps).
- 15% have visibility of production alone.
Improving visibility in the “range of flows (physical, logical, financial) throughout both the entire supply and value chains” is essential, according to GEODIS. It is the key to gaining a grasp on the complexity involved in today’s supply chains and also can lead to other beneficial outcomes like enhanced “collaboration with partners” and fewer conflicts between them, as well as reduced risk, flexible responsiveness, and enhanced “customer satisfaction.” All those add up to a more efficient and profitable business.
The question is: how to get there? The solution is getting the right technology in place. The survey responders are aware that they need to get a handle on their data. That why the top categories on the tech wish list are: “Data analysis (41%) and Internet of Things (39%).” An awareness of the processing of big data was also reflected in the fact that 39% also referred to Cloud Computing and that 29% named “predictive analytics.”
There was also an awareness of other technological advances that can contribute to better supply chain movement. Those include 3D printing referred to here as “additive manufacturing (22%), mobile production units (19%),” as well as the tracking ability made famous by Bitcoin, that is “blockchain (18%).”
As the supply chain has evolved into something much more complex than it was before, businesses will have to evolve, as well. Those who fail to adapt and adopt the technology that will allow them the visibility they need to effectively plan and strategize will undoubtedly fall behind those who do.