Top 10 Global Supply Chain Predictions for 2009
By Simon Ellis, Practice Director, Manufacturing Insights
Manufacturing Insights spoke with technology vendors, consultants and buyers about what the coming year will hold for supply chains in the manufacturing industry. Given the challenging economic environment and manufacturers' intentions for austerity in IT investments, Manufacturing Insights offers the following ten supply chain predictions for 2009:
Prediction #1: Companies will exploit well-performing existing tangible and, especially, intangible supply chain assets to ride out the financial crisis and prepare for recovery.
Prediction #2: Modern supply chain organizations will put expenditure budgets under greater scrutiny, and new investments will be cost-savings focused, requiring shorter payback periods. Expenditures will be made through the lens of cost/value.
Prediction #3: Companies will "right size" their supply chains for profitable proximity and take a total-landed cost approach to product sourcing. Standard corporate platforms will seek to configure, calibrate, and control increasingly complex scenarios.
Prediction #4: Supply chain technology initiatives must support the standard business platform and focus on modernization and decision making.
Prediction #5: Economic uncertainty, particularly for smaller suppliers in emerging economies, causes manufacturer "brand owners" to consider strategic investments at critical supply points and financial support for key suppliers.
Prediction #6: CRM and consumer-centricity efforts continue to grow across the modern supply chain as manufacturers attempt to provide the right kinds of innovation and new products. The sale is just the start as services become an increasingly important part of the "product experience."
Prediction #7: The high 2008 year-end inventory levels will cause manufacturers to look at supply/demand rebalancing with a focus on strategic network optimization and multi-echelon inventory optimization tools, and where industry-relevant, price and trade promotion management/optimization.
Prediction #8: Compliance-driven RFID initiatives continue to wane in favor of ROI-driven asset-tracking and security applications as manufacturers increasingly look at RFID as "just another tool in the toolkit." One consequence of this will be continued vendor consolidation in an effort to provide end-to-end applications and deeper industry-specific expertise.
Prediction #9: As global economic pressures mount, outsourcing opportunities proliferate and global supply networks become more complex, risk management becomes both an increasingly significant capability and a key differentiator for the Modern Supply Chain.
Prediction #10: Sustainability discovers metrics. It will no longer be a feel good public relations proposition or even a regulatory compliance mandate. Emerging standard measures and a desire to benchmark will impact sustainability initiatives and the associated investment in technology and services.
Buckle up. It's going to be a rough ride. There is more bad economic news than good, and despite the recent agreement in Washington to approve loans to the "Detroit 3" automakers and a November lull in home foreclosures, most expectations are for a tough start to 2009.
So, it is practically certain that there will be more pain before we see evidence of a recovery. However, in 2009, supply chain and information technology organizations have the opportunity to contribute to mitigating efforts.
Manufacturing Insights spoke with technology vendors, consultants and buyers about what the coming year will hold for supply chains in the manufacturing industry. Given the challenging economic environment and manufacturers' intentions for austerity in IT investments, Manufacturing Insights offers the following ten supply chain predictions for 2009:
Prediction #1: Companies will exploit well-performing existing tangible and, especially, intangible supply chain assets to ride out the financial crisis and prepare for recovery.
Prediction #2: Modern supply chain organizations will put expenditure budgets under greater scrutiny, and new investments will be cost-savings focused, requiring shorter payback periods. Expenditures will be made through the lens of cost/value.
Prediction #3: Companies will "right size" their supply chains for profitable proximity and take a total-landed cost approach to product sourcing. Standard corporate platforms will seek to configure, calibrate, and control increasingly complex scenarios.
Prediction #4: Supply chain technology initiatives must support the standard business platform and focus on modernization and decision making.
Prediction #5: Economic uncertainty, particularly for smaller suppliers in emerging economies, causes manufacturer "brand owners" to consider strategic investments at critical supply points and financial support for key suppliers.
Prediction #6: CRM and consumer-centricity efforts continue to grow across the modern supply chain as manufacturers attempt to provide the right kinds of innovation and new products. The sale is just the start as services become an increasingly important part of the "product experience."
Prediction #7: The high 2008 year-end inventory levels will cause manufacturers to look at supply/demand rebalancing with a focus on strategic network optimization and multi-echelon inventory optimization tools, and where industry-relevant, price and trade promotion management/optimization.
Prediction #8: Compliance-driven RFID initiatives continue to wane in favor of ROI-driven asset-tracking and security applications as manufacturers increasingly look at RFID as "just another tool in the toolkit." One consequence of this will be continued vendor consolidation in an effort to provide end-to-end applications and deeper industry-specific expertise.
Prediction #9: As global economic pressures mount, outsourcing opportunities proliferate and global supply networks become more complex, risk management becomes both an increasingly significant capability and a key differentiator for the Modern Supply Chain.
Prediction #10: Sustainability discovers metrics. It will no longer be a feel good public relations proposition or even a regulatory compliance mandate. Emerging standard measures and a desire to benchmark will impact sustainability initiatives and the associated investment in technology and services.
Buckle up. It's going to be a rough ride. There is more bad economic news than good, and despite the recent agreement in Washington to approve loans to the "Detroit 3" automakers and a November lull in home foreclosures, most expectations are for a tough start to 2009.
So, it is practically certain that there will be more pain before we see evidence of a recovery. However, in 2009, supply chain and information technology organizations have the opportunity to contribute to mitigating efforts.