Saturday 18th Nov 2017 - Logistics Manager

No time to cut the budget

The global market for supply chain software grew 7.1 per cent last year – pretty impressive given the disappointing performance of the world economy.

The figures from Gartner show that in 2012, the market rose to $8.3 billion reflecting the priority status that companies have given to supply chain investments.

Top-place SAP showed sales of $1.7bn ahead of Oracle at $1.45bn. JDA came third with sales of $426m. Ariba was fourth with sales of $319.2m – Ariba was taken over by SAP last year.

Manhattan Associates was the fifth-place player in the market with sales of some $160m.

Gartner calculates that those five account for about half the total worldwide supply chain management software market.

Chad Eschinger, research vice president at Gartner, points out that while cost reduction has been moving back to a main business driver, “supply chain remains a key source of competitive advantage in driving business growth objectives”.

The study also found that the strongest growth had been in software-as-a-service which grew 13 per cent last year reflecting the focus on fast implementation at a lower upfront cost.

However, only last week, a study by KPMG found that almost half of manufacturing executives globally admit that their companies do not have visibility of their supply chains beyond Tier 1 suppliers.

Clearly, there is plenty of work to be done in improving supply chain visibility and better IT systems are at the core of that. This is not the moment to cut the supply chain software budget.