Subscribe to our free, weekly email newsletter!


IDC study suggests manufacturers have learned their lessons

By Patrick Burnson, Executive Editor
January 20, 2011

As U.S. manufacturers begin to realign their supply chains with tactical and strategic initiatives, how will the recent recession inform their decisions?

That question and others is addressed in the recently issued IDC Manufacturing Insights: Supply Chain Strategies: “Top 10 Predictions.”

In putting this study together, IDC analysts Simon Ellis and Kimberly Knicle, learned that while manufacturers are ready spend again, many are still reeling from the the recession’s aftershock.

“We see a slow return to basics,” said Ellis in an interview with LM. “They are not buying ‘solutions’ per se, as they understand that there’s not really any ultimate answer to every shipping and sourcing challenge.”

Rather, he said, manufacturers are ready to invest in tactical applications which can be used for long-term strategic objectives.

Indeed, one of IDC’s predictions is that supply chain visibility will climb on the IT application priority list as manufacturing companies increasingly identify critical use cases to drive both cost savings and improved service levels.

“It was really not so long ago that S&OP was a major component in any company’s portfolio,” said Ellis. “And guess what? It’s back again.”

He added that although demand forecasting continues to be important, supply chain organizations will begin to recognize the critical role of supply-side responsiveness.

“Which means stripping out complexity and trying to simplify again. Back in my days with Unilever, this was our mantra. Now, it seems, that a lot of other multinationals are falling into line.

Among other predictions made in the study:
-Supply chain visibility will climb on the IT application priority list as manufacturing companies increasingly identify critical use cases to drive both cost savings and improved service levels.
-In the context of taking a broader view of total cost, supply chain organizations will gain a new appreciation for shortening lead times through profitable proximity sourcing strategies.
-Cost containment, and the desire for variable supply chain structures, will continue to drive outsourcing of operations, but will also bring a more enlightened perspective to SaaS and “skills resourcing.”
-Supply chain modernization will pick up speed again as manufacturing companies look to drive fulfillment excellence through transportation, warehouse, and labor management tools.
And perhaps most importantly of all, said Ellis, companies will begin hiring again.

“A jobless is recovery is an unsustainable recovery,” he said. “We are not saying that there will be a wholesale move to create a new workforce, but we do see manufacturers beginning to invest in people again.”

About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Transportation stakeholders reliant on North Carolina’s major seaports are welcoming news this week, which outlines plans to enhance the intermodal and cold chain network in the region.

The index ISM uses to measure non-manufacturing growth—known as the NMI—was 56.9 in February, which was 0.2 percent ahead of January and also 0.1 percent ahead of the 12-month average of 56.8. Economic activity in the non-manufacturing sector has grown for the last 61 months, according to ISM.

Non asset-based third-party logistics (3PL) services and logistics technology services provider Transplace said today that Brooks Bentz has joined the company in a newly-created role as president of Transplace Consulting in conjunction with the launch of the company’s new North American consulting services practice.

The advent of e-commerce continues to grow and gain increased traction over time. The many ways for consumers to order and purchase goods online continues to expand and leads to various subsequent byproducts of online purchases, including shopping through multiple channels, and delivery and payment options, among other things. These types of topics serve as the thesis in the second annual UPS Pulse of the Online Shopper Global Study issued this week by UPS and comScore Inc.

A major highlight of CEVA’s fourth quarter performance was its new business wins, which were up 14 percent for all of 2014, with Freight Management wins up 14 percent, and Ocean Freight and Air Freight wins up 30 percent and 14 percent, respectively, while Contract Logistics wins were up 2 percent.

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA