APICS CEO Abe Eshkenazi CSCP, CPA, CAE -
October 12, 2012
Last month, SCM World published its third annual Chief Supply Chain Officer Report. The report itself is dense, but overflowing with valuable information. One theme is clear: Supply chain management increasingly has a more important and strategic role within successful organizations.
“Our research shows that more and more companies are using supply chain excellence as a means to create value and competitive advantage,” said Hau Lee, PhD, chair of SCM World and Thoma Professor of Operations, Information and Technology at Stanford University. “Those that still view supply chain management as a supporting function, or see it only as a way to reduce operating costs, have a lot of catching up to do. They are missing great opportunities.”
In July 2012, SCM World surveyed almost 1,400 practitioners from industries and locations all over the world. The survey covered five main topics: strategy alignment and value creation, digital consumers and e-commerce, social and environmental responsibility, risk management, and talent management.
“In 2012, we continue this exploration, in order to more concretely understand how the role of supply chain is evolving, and how value can be created through excellence in supply chain management,” write Lee, Kevin O’Marah, and Geraint John, the study’s authors.
The study underscores a phenomenon you no doubt have been feeling yourself. As supply chain moves to a more strategic role within businesses, supply chain and operations managers must prove their dexterity. “Talent requirements include many of the same business skills needed to succeed in roles such as sales or finance. Supply chain does not exist merely to serve the business, but instead is integral to the business.”
Other key findings of the survey follow:
- Social media currently plays little role in supply chain strategies (47 percent of respondents see “no effect” today), but in the future 56 percent see opportunities to get customer feedback, 46 percent see opportunities for product innovation, and 41 percent see opportunities to warn of supply disruptions.
- More than half of respondents report good results from social and environmental responsibility efforts in complying with government regulations and laws, and in improving both supplier relationships and customer satisfaction. But measuring benefits is a challenge for almost 6 out of 10.
- More than 8 out of 10 companies have been hit by a supply or demand disruption during the past two years. Additionally, almost half of respondents have suffered a loss of sales or revenue and more than one-third have experienced lower profits as a result of a disruption.
- The most significant ways in which supply chain excellence boosts top-line growth, according to survey respondents, are the ability to launch new products on schedule, ramp up production quickly, ensure repeat purchases through greater customer loyalty, and receive priority treatment from suppliers when key materials and components are in short supply.
Last year’s Chief Supply Chain Officer Report stated, “by far the most commonly cited number one preference for certification bodies was APICS.” I was gratified by this validation. In the last year, APICS staff and volunteers have been working hard to advance the practice of supply chain management and promote the value of supply chain professionals. As I gear up for APICS 2012 in Denver, Colorado, I find that the conference theme is a priority for me every day: “Elevate Supply Chain Performance.” I am pleased this transformation is occurring, and I am proud of the APICS body of professionals who are making this happen. Congratulations.
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Delving into the Dark
By Richard E.Crandall, PhD, CFPIM, CIRM, CSCP
September/October 2012, APICS magazine