Increasing globalisation puts pressure on supply chain systems

The trend for companies to source globally is having a major impact on the design and performance of supply chain systems, according to the latest survey of this market from PMP Research. The research has been commissioned by the Evaluation Centre.

Up to half the respondents cite increased competition (50%) and globalisation (41%) as key factors in their decisions to invest in supply chain solutions. These two developments have produced significant changes in customer order patterns, which are also identified as a business driver by 48%.

Almost half the sample reckon that the current product lifecycle of their best-selling items is now shorter than it was two or three years ago. This is nearly twice the proportion (26%) who took this view in the previous year's report.

The pressure to adjust constantly to meet new requirements is having an effect on supply chain systems, with only a third of companies (36%) claiming to have a five-year strategy for supply chain systems and technology.

In contrast, 46% expect to revise their supply chain approach annually, and 27% are reviewing the situation every six months.

There are also strong differences in how organisations plan to manage their supply chain systems in the future. Currently the majority (69%) do so at a national level, but this is set to halve to 38% over the next two years. In contrast, while 19% currently look after their supply chain on a global basis, 31% will be doing so in future.

Given this background, two-thirds of those polled (67%) believe that improving communication and/or collaboration along the supply chain is now more important than it was two years ago. Three-quarters (76%) plan to use the web for supply chain activities, largely because of the opportunities that online working offers to cut costs, although 55% say they remain concerned about possible security issues.

Concepts such as online B2B marketplaces have some way to go before achieving widespread acceptance, with just 25% of companies using such options for activities such as procurement.

However, the survey finds that a third (31%) of companies are now investing considerably more in supply chain software than they did three years ago. New technologies such as Radio Frequency Identification (RFID) are also starting to make their mark, with 26% of organisations saying they have already invested in this technology and 24% indicating they may well do so in future.

About PMP Research

PMP Research, founded in 1990, is the leading European independent analyst firm and part of PMP Group Services. The firm provides bespoke research, analysis and consultancy on a UK, European or global basis, typically within the IT, telecoms and professional services markets.

PMP Research being part of the PMP Group, has access to a database of over 68,000 individuals. This unique facility reduces cost and timescales for any project undertaken.

About the Evaluation Centre is the website and service centre to assist buyers of software, services and technology in their procurement process. It achieves this by dividing the site into four areas (a) Strategy - this part of the site help users build their IT and Business strategy (b) Supplier Evaluation - this part has over 150 suppliers evaluation reports and lists an additional 1200 suppliers (c) Implementation - this part of the site provides guidance in terms of implementation best practice and finally (d) the Service Centre - this part of the site provides help desk facility.


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