High-tech leaders opt for a more localized supply chain
The fifth annual UPS “Change in the (Supply) Chain” survey, which was conducted by consulting firm IDC Manufacturing Insights, polled 516 high-tech executives from North America, Europe, Latin America and Asia-Pacific. The conclusion reached in the survey is that there is a rise in transportation costs, an influx of high-tech executives moving away from an offshore based production strategy as well as an incessant increase in customer demand for faster delivery.
Although 47 percent of respondents continued with offshore strategies to decrease labor costs, many executives are opting to keep their supply chain closer to local resources and markets to cut both inventory and transport costs. They also want to protect their intellectual property rights and have a stronger grip on their customer service. Dave Roegge, the high-tech marketing director at UPS, believes that this change in trends is due to high-tech executives seeking to “respond better to demanding market dynamics”.
Read the full article, found here.
Automotive recalls indicate need for supplier diversity
The recent automotive recall carried out by 11 U.S. manufacturers could mean that 34 million vehicles will be taken off the market. What was the cause for this recall? The straightforward answer is that Takatam, a main supplier of airbag inflators, acknowledged a defect in its product. However, the root problem for car manufacturers is their lack of supplier diversity.
Duncan Brock, the customer relationship director at the Chartered Institute of Procurement & Supply (CIPS), believes that companies are limiting their supplier outlook by relying on a “handful of global suppliers for key components”. When things do not go as planned, having other options to replace malfunctioning stock or a list of new suppliers is a plan best made before any problems arise.
For more on the article, click here.
Supply chain talent will be the key differentiator as complexity rises
A recent Deloitte annual supply chain report found that talent will be the most import thing influencing a firm´s supply chain performance. The report examined 11 separate practices such as “increasing diversity”, “new or nontraditional talent pools” as well as “informal development programs”. Deloitte discovered that these practices were in extensive use in no more than 20% of the responding firms.
The report concluded that “as a profession, supply chain management finds itself in something of a crisis”. It holds the years of headcount reductions, training budget cuts and the retirement of highly skilled individuals liable for the current situation. This hollowing out of the “ranks of veteran professionals” has added to the strong need for a new wave of supply chain talent.
To read more, click here.
Have a nice weekend!