PRTM survey focuses on supply chain flexibility

Supply chain flexibility is the new imperative for growing company revenues while keeping supply chain costs under control

By ·

High volatility, massive swings in customer demand, and challenges in ensuring sufficient supply are the current reality for global supply chain executives—making supply chain flexibility the new imperative for growing company revenues while keeping supply chain costs under control.

The findings are part of a new survey—2011 Global Supply Chain Trends—from global management consulting firm PRTM. Based on interviews with senior executives from 150 companies across industries, this 2011 supplement to PRTM’s 2010-2012 Global Supply Chain Trends report identifies five levers that increase operational flexibility, drive revenues and cut costs.

Companies that have implemented the five supply chain flexibility levers have, on average, achieved a 12 to 15 percent revenue increase and reduced supply chain costs by 8 to 10 percent, according to PRTM. However, PRTM found that operational flexibility requires significant investment as well as a top-down commitment from supply chain executives. In the survey, supply chain leaders are defined as the top 20 percent of supply chain performers, while laggards are the bottom 20 percent. Companies were evaluated according to various quantitative criteria and PRTM’s Supply Chain Maturity Matrix, which is based on the Supply-Chain Operations Reference-model (SCOR).

“Volatility is the new norm for supply chain operations, and continuing economic uncertainty is affecting demand by driving shorter capital investment cycles and tighter inventories,” said Dr. Reinhard Geissbauer, director at PRTM and leader of the study. He continued, “At the same time, political unrest, growing competition for resources, and a supply base not yet fully recovered from the financial crisis is generating supply shortages. And that outlook does not even include singular events such as Fukushima, Icelandic volcanoes, and other natural events.”

In an interview with SCMR, Brad Householder, director of PRTM’s supply chain practice, said that the report represents “a cautionary tale,” separating the haves and have-nots.

“Those with end-to-end visibility will continue to manage inventories and labor with more forecasting prowess,” he said. “And they will be at an advantage in spotting leaks or bubbles in the supply chain.

For related articles click here.


About the Author

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 [email protected]

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!

Article Topics

All Topics
Latest Whitepaper
Private Fleet vs. Dedicated: Which one is right for you?
Having the right fleet for your business can give you an advantage over the competition and lower transportation costs.
Download Today!
From the April 2017 Issue
While adoption rates have remained relatively flat, yard management systems (YMS) are helping logistics operations turn that important space between the loading dock and the gate into a vital link in the supply chain.
Information Management: Wearables come in for a refit
2017 Air Cargo Roundtable: Positive Outlook Driven by New Demand
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Maximize Your LTL Driver Adherence with Real-time Feedback
This webinar shows how companies are using real-time performance data to optimize the scheduling of their city fleets, as well as the routing of their standard, accelerated and time-critical shipments.
Register Today!
EDITORS' PICKS
2017 Salary Survey: Fresh Voices Express Optimism
Our “33rd Annual Salary Survey” reflects more diversity entering the logistics management...
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...

ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...
2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...