United States President and World War II General Dwight D. Eisenhower once said: “In preparing for battle, I have always found that plans are useless, but planning is indispensable.”
He could be talking to today's business world about emerging markets. In the past two decades, we've heard a lot about emerging markets and the challenges and opportunities associated with them.
Last week, research house Gartner Inc. stepped forward with a relevant report on emerging markets, which it forecasts as a $30 trillion opportunity and names as the primary business growth area in this century. According to Gartner, it's supply chain leaders who will be responsible for the success or failure of business growth in these markets based on the capabilities they put in place.
Rightly so, Gartner believes that organizations with strong demand planning capabilities and segmented supply strategies are better positioned to capitalize on market opportunities, as well as to mitigate risks.
It's no secret that emerging markets offer tremendous opportunities that mature markets no longer can. But opportunity never comes without obstacle, and with these emerging markets come unique characteristics and challenges — characteristics and challenges that will only become more complicated as they flex and twist overtime and as business expands in each region.
“The ability to plan demand better is a tremendous advantage, as accurate demand plans help supply chain leaders align end-to-end supply chains correctly, and forecast predictable outcomes and profitable responses to demand,” said Mike Burkett, research vice president at Gartner, in a statement on the report.
Burkett goes on to state that businesses are positioning to take advantage of the most explosive growth opportunity since the industrial revolution and that, “as business executives look to emerging markets for opportunity, the supply chain organization will be tasked with serving that growth.”
For its report, Gartner surveyed more than 390 CEOs and senior business executives. The survey showed that CEOs recognize the supply chain is vital to opportunity in emerging markets, but that they are split on their view of its readiness.
About half of those surveyed see globalized supply chains as more complex and fragile now, while the other half said supply chains are more resilient than at any time in history. Depending on the specific emerging market and strength of one's supply chain management, both statements could be true.
Whether you “like Ike” or not, his decades-old quote has relevance as businesses' reach becomes ever more global. It is the planning and planning's need for constant re-evaluation — not the plan, itself — that will allow business to prosper through its supply chains, particularly in such as high-flex industry as the electronics industry.
It is having well-tuned electronics supply chains and professionals in place that flex and twist to emerging markets, always planning for the immediate and anticipating what will immediately follow, that will allow successful supply chains to expand business in emerging markets.
Gartner noted that dealing with the risk of uncertainty was commonly seen as daunting by its survey respondents, with the most-cited supply chain challenge in emerging markets being dealing with changing rules. And it's no wonder.
Right now, from where we sit in the summer of 2013, demand in emerging markets can be described as fragmented at its best, requiring infrastructure support for both physical product and information flows. With lower quality transportation, limited technology, and inconsistent local supply capabilities, these markets are unnerving to enter, let alone prosper in.
Toss in cultural and political differences, and taking advantage of the $30 trillion opportunity is a risky task, even with the best supply chain management at your defense.
But there's also another quote I'm fond of by Mike Tyson: “Everybody has a plan until they get punched in the face.” The trick to emerging markets, as in boxing, is to keep moving. Always be revising based on market changes that will surely occur, undoubtedly at faster rates than we expect; always be planning and never set a plan in stone.
Continual planning as these emerging markets evolve through supply chain tactics is the best defense and best way to success.
What are your thoughts on planning for supply chain management in emerging markets? Tell us below.