Gartner special report examines supply chain strategies for emerging markets

Supply chain leaders will play a crucial role as companies capitalize on the explosive growth in emerging markets, according to Gartner Inc.

Emerging markets have been identified as the primary business growth area for the next century, and Gartner said 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.

“Emerging markets present huge opportunities but come with unique characteristics and challenges due to the constant thrust for business growth, volatile demand and low maturity of supply chain processes,” said Mike Burkett, research vice president at Gartner. “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.”

In an interview, Burkett said most of the research and advice is applicable across markets.

“The Asia Pacific is most often used in our examples, though the advice is applicable to Latin America and other markets,” he said.

“Businesses are positioning to take advantage of the most explosive growth opportunity since the industrial revolution. That growth won’t come from existing developed markets but from expanding into less-developed emerging markets,” said Burkett. “Defining the source of future growth was reflected in a recent worldwide Gartner survey of more than 390 CEOs and senior business executives. Respondents indicated concern about a continued recession in advanced economies. As business executives look to emerging markets for opportunity, the supply chain organization will be tasked with serving that growth.”

While CEOs recognize the critical nature of the supply chain to this global expansion, they are split on their view of its readiness. Fifty-one percent of executives surveyed see globalized supply chains as more complex and brittle now, with the balance feeling that they are more resilient than at any time in history. Gartner believes the solution in both cases is to develop supply chains that can achieve global scale while reliably serving the unique needs of both developed and emerging nations.