As pressure to improve supply chain cost performance increases, the evaluation and selection of competent suppliers become a concern for companies. The importance to recognise the key trends can help companies to have a better approach to customer demand and the market changes.
Here are 7 supply chain trends in the upcoming years:
1. Customer-driven Supply Chains
With reduced life cycles, customer-driven innovative products and services have forced supply chains to be flexible and adaptable. The biggest implication of this new imposition on the procurement process is that procurement managers nowadays have to select suppliers which are not only cost-conscious but also timely operations, and can adapt to the changing demands of end customers.
2. Connected Supply Chains
Data coming from different suppliers carry a lot of information regarding the quality of the production process and timeliness of delivery. At the same time, this data may indicate possible issues in the procurement process. Therefore, monitoring and analysis of this data may provide opportunities to intervene before issues become major problems.
3. Risk Management
In the past, many buyers relied on safety stock inventory to mitigate any risks or disruptions to suppliers. But one of these trends nowadays, in addition to inventory keeping, is dual/multi-sourcing. Reducing the dependence on a sole supplier is crucial in managing risk.
4. Management of Complexity
Managing complexity has become an accepted fact of managing procurement processes. Analysis and optimization of complexity require a complete understanding of market volatility.
5. Technology Matters
Having a holistic view of information technology offerings for integrating all supply chain operations, including procurement processes is crucial in the current business environment.
6. Rethinking Workforce
Unfortunately, the traditional workforce training models do not support the current needs which are data-driven decision-making skills and fulfil the understanding of end-to-end supply chains. Skill gaps will continue to be a challenge for companies.
7. Total Cost Perspective
When large amounts of products are purchased, inventory keeping and management costs are skyrocketed. Therefore, instead of considering the Procurement price, now buyers have to consider all dimensions and impact of procurement on other operations including Inventory, Transportation, Handling, etc.
Take these seven trends into consideration. It will help you come up with the best plan of action to improve your supply chain activities.