Wednesday 22nd Nov 2017 - Logistics Manager

Sorting the winners from the losers

The onset of the economic downturn, one suspects, was so rapid that it left many organisations frantically scrambling around to recover.

Sometimes firefighting is unavoidable, but it is dangerous to allow this to become all-consuming.

The thought arises because a new study suggests that supply chain planning is not being given the focus essential to navigate the current challenges. This could be the factor that sorts the winners from the losers.

“SCP is not yet universally seen as a strategic, decision-critical activity, with the majority of respondents viewing it as simply a support function, and very few respondents considering their organisation to be innovators or best-in-class in planning,” according to Capgemini’s Global Supply Chain Planning Study 2009.

Capgemini talked to 120 supply chain executives from around the world and found that most organisations are not factoring in the increased risks associated with the tougher economic environment.

“Though most companies recognise that close collaboration with partners and customers is key to success, many have not defined mechanisms to accomplish this and struggle to achieve end-to-end supply chain integration both internally and externally.”

Some 67 per cent of participants said that changes in planning processes were key to improving the overall performance of the supply chain.

But set against this is the fact that more than half regard it simply as a back-office function and few organisations are involving suppliers and customers in their planning processes.

The survey also found that three-quarters of respondents indicated that their organisation has regular S&OP processes in place. However, data availability and accuracy is an issue owing largely to a lack of adequate IT functionality to support the S&OP process.

Globalisation of suppliers and markets has made supply chains longer and more complex, making effective planning ever more important. The business environment is changing very fast.

Firefighting is all about dealing with problems that have already arisen: the winners will be those who are ready for the problems yet to come.