In this recent Consumer Goods Technology article, The State of Supply Chain Execution, industry thought leaders, including Management Dynamics CEO Jim Preuninger, give their opinions on today’s challenges and trends affecting supply chain execution.
A key discussion point in the article is how, though faced with tough economic times, companies are still investing in technologies that help streamline their supply chains operations.
Many companies, particularly manufacturers, including consumer goods manufacturers, have seen the value in using GTM software to lower costs, ensure regulatory compliance, improve customer service and automate many facets of a company’s supply chain operations. Two capabilities that consumer goods companies are using to weather the downturn are supply chain visibility and international trade compliance. These tools provide an immediate and visible return on investment, enabling companies to reduce costs, improve operations, shrink manual data entry errors, facilitate cross border movements and improve customer service.
In addition to cutting costs, GTM software can also be used to address sustainability concerns. According to Mr. Preuninger:
In the case of GTM software, sustainability efforts can be addressed on a few fronts. Reducing cycle times, eliminating bottlenecks, improving distribution networks, lowering out-ofstocks and determining the best way to ship freight can also lower emissions, an ecological goal for many companies.
To read the full article, please follow this link.
A 3% increase in manufacturing production is expected in 2010, according to Stan Gwizdak from the consulting firm, Celerant. According to an article in Supply & Demand Chain Executive, Mr. Gwizdak gives a few main factors that will contribute to this upturn:
Declining imports as companies review their supply chain strategies;
Continued market consolidation and acquisition activity; and,
Green products and companies in the solar, wind, and geothermal space.
So, good news! However this will not come without challenges. Mr. Gwizdak states that the biggest challenge for manufacturers will come from “the complex supply chain with global operations, logistics, warehousing and reduced time available for new product introduction and time to fulfill a customer order.” Not too surprising. Anytime a company increases operations or expands globally, there will be new supply chain issues that need to be addressed. And, most importantly, the more complex a supply chain is, the more imperative it becomes to communicate with trading partners so that no one is left out of the loop.
Although analysts are reporting that economic recovery is just around the corner, there are still significant risks associated with this recovery. Companies who have laid off employees and reduced spending in areas such as IT investment will face a tough road ahead. In a recent study done by AMR Research, 44 percent of executives surveyed believe the biggest risk in 2010 will be recovering from the recession.
According to the study:
Respondents said they believe the recovery cycle is the biggest risk in 2010 because of potential commodity price increases, limited internal skills after workforce reductions, and problems meeting new demand with constrained capacity, low inventory and transportation constraints.
This re-enforces a point we’ve been trying to make here over the past few months – although many organizations may be facing major budget cuts across the board, IT spending, specifically in the supply chain, is one area that you cannot afford to make cuts in. Using a technology solution to ensure near real-time visibility into the status of orders, shipments and in-transit inventory can help save you money by avoiding expensive expedited shipments, reducing fees associated with detention, demurrage and per diem.
Free AnalystReport: For more tips on how technology can help you achieve optimal supply chain performance, please read this Global Supply Chain Benchmark report from the AberdeenGroup.
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