An annual publication from Montgomery Research
ASCET Year Seven. That's just about as long as most of us have been using email, buying online and going wireless. The accelerating change in how we do business is affecting every part of the supply chain.
Chapter 1:
Vision
After several years of intensive focus on cost containment and efficiency improvements,
supply chain management has moved into a gentle growth cycle and new directions
are emerging. Wireless and location technologies as well as RFID are some of
the most innovative technologies situated to transform the business of moving
products around the globe.
In addition to technology, pioneering business processes are contributing to
advances in achieving a customer-driven industry standard. There is still a
way to go, but these changes in processes and technologies are contributing
to the realization of an open, flexible and collaborative global supply network.
Intensified levels of collaboration and data integration, as well as customized
business models, are key to achieving the visibility, cost efficiency and speed
necessary to meet the call for an agile supply ecosystem. Organizations that
can adapt to rapidly changing demand and market conditions will remain ahead
of the competition and set the standard for the supply chain of the future.
This section offers in-depth discussion of the characteristics of the nascent
supply chain as well as advice on the steps to take today to reap the benefits
of truly linking the supply chain to customer demand.
Chapter 2:
Procurement and Logistics
Outsourcing and ever-increasing globalization have changed the landscape in
procurement, and many organizations have achieved significant savings through
procurement service providers, supplier management programs, new business intelligence
methods, e-sourcing and e-procurement. Though large-scale adoption of new technologies,
processes and services have yet not transpired, for those ready to make the
investment, performance improvements will come from increased granularity, easier
information sharing via Internet interfaces, e-procurement and e-sourcing, as
well as expanded sourcing from low-cost countries.
Meanwhile transportation is undergoing considerable transformation, as already
tight capacity gets tighter, fuel and freight rates continue to increase and
the demand for faster turnarounds and greater visibility keep the pressure on.
Carriers are redefining contracts by constructing rate scales that reward companies
that can reduce inefficiencies, such as driver delays. Automation, forecast
sharing and carrier-friendly relationships are some of the tools top-performing
companies are using to secure capacity, and EDI and geopositioning technologies
will support innovations in transportation down the road.
Chapter 3:
Design and Manufacturing
End-to-end low costs and rapid production are the result of effectively designed
collaborative products, innovative manufacturing programs and pioneering outsourcing
advances.
In this chapter, we take a look at how companies small and large are achieving
design improvements, faster cycle times and lower inventory levels.
The lean transformation is alive and well and continues to accelerate processes
on the factory floor. Strategic objectives are being met by new approaches to
pricing, outsourcing and inventory management. Successful supply chain integration
from the plant to the end purchaser is moving the industry closer to achieving
a pull model.
Chapter 4:
Fulfillment and RFID
The pull model in fulfillment has yet to become a widespread reality, but the
vision is gaining power as well as real-time success. Smart labels, RFID and
other sensor-based technologies offer exciting possibilities to connect all
aspects of the supply network, integrate and expand tracking information and
allow for entirely new information streams to flow into the supply network.
In this section, we explore operational performance, fleet management and new
applications of sensor-based labeling with a focus on gaining value. Careful
strategic planning and realistic goals and objectives are the critical elements
to success in the years ahead.
Chapter 5:
Collaboration
A recent survey by Accenture revealed that collaboration levels have risen
dramatically since 2002, and most companies expect to increase their collaborative
activities significantly. This increase is driven by the successes that cooperative
business processes are delivering. Improvements in stocking rates and savings
in multiple areas including demand forecasting, inventory management, product
development, promotional planning and logistics are well-established. However,
the benefits extend beyond simple cost reductions culled via outsourcing. Experts
predict that the best-positioned companies are those with the most effective
strategic partnerships – partnerships that will add value through shared strategic
goals. These partnerships allow each party to focus on core strengths and benefit
from the market insights of trading partners.
For those just venturing into collaboration, starting small with simple initiatives
is often best, so that issues such as unsynchronized enterprise solutions and
data can be resolved before moving to more strategic alliances.
Chapter 6:
Industry Outlook
There is no out-of-the-box supply chain strategy that translates perfectly
to every market. Therefore, in this section, we take a closer look at several
industries and offer some in-depth, tailored approaches to achieving high performance.
Equally, new technologies and business processes in the chemical, aerospace
and defense, high tech manufacturing, financial services, utilities, healthcare,
and consumer goods sectors are being implemented with transferable results.
For example, RFID has been deployed in aerospace and defense to a greater degree
than in most industries, and the lessons learned offer useful insights to other
industries. In high tech manufacturing, outsourcing has presented compliance
challenges in many countries, and the experience of that domain can provide
valuable instruction across industries.
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