voice of the supply chain leader - 2014 - summary charts
DESCRIPTION
Executive Overview Supply chain is an important enabler of corporate performance. Growth is slowing. Success in global operations is an organizational imperative. With the rise in complexity (products, markets and rate of change), supply chain excellence is more important for companies to effectively compete. As a result, 55% of supply chain leaders report that they will be increasing spending on software deployments this year. The goal is to balance growth with customer service, operating cost and inventory levels. It is easier said than done. The accomplishment of this goal requires supply chain software, but the selection is not easy. Today the market is more confusing that it was five years ago. The supply chain software market is not an easy market to navigate. It was conceived in the mid-1980s, and redesigned for client-server software in the 1990s. Due to the number of technology provider consolidations, it has been slow to adapt to cloud and mobile computing. The gap between the importance of the software and the current level of performance is high, and has remained so over the course of the three years of this study. The reasons are many. They include leadership, organizational, and technology barriers. Some of these barriers are outlined in figure 2. Here, based on phone interviews and strategy days with supply chain leaders, we add some color to three of the top gaps: • Executive Understanding of Supply Chain Management. A major gap in the implementation of supply chain software is the executive level understanding of supply chain as a complex system. Functional metrics lack alignment, complexity is rising and the pressure is on to drive improvement. Unfortunately, all too many companies reward the urgent, not the important; and as a result, companies are not able to fully take advantage of planning software. The gap between importance and satisfaction is lower for functional planning—examples include product life cycle management, transportation management and warehouse management—than with demand planning where companies have to make trade-offs to improve corporate performance across functions. • Ability to Get to the Right Data. As companies implemented supply chain software, they learned the hard way that they needed both systems of record and systems of differentiation. Supply chain planning requires “what-if” analysis and multiple optimization runs through systems of differentiation. Visibility systems require a robust system of record to enable the consolidation of data from multiple systems to be used by both casual users and supply chain planners. Supply chains need both. Line-of-business leaders drive discussions on the depth of optimization and the depth of functionality in systems of differentiation while Information Technology (IT) teams focus on integration and systems of record. The larger the company, the more diverse the architectures and the tougher the problem to build scalable systems of record to ...TRANSCRIPT
Voice of the Supply Chain Study
Summary Charts2013-14
Supply Chain Insights LLC Copyright © 2014, p. 2
Agenda
Study Overview
Supply Chain Performance
Supply Chain Center of Excellence
IT Systems and Spending
Supply Chain Insights LLC Copyright © 2014, p. 3
Study Overview
Supply Chain Insights LLC Copyright © 2014, p. 4
Nearly 3/4 of Respondents Work for a Manufacturer
Supply Chain Insights LLC Copyright © 2014, p. 5
Respondent Companies Have an Average of $4B in Revenue and 28,000 Employees
Supply Chain Insights LLC Copyright © 2014, p. 6
Nearly ½ of Respondents Work in a “Discrete” Industry
Supply Chain Insights LLC Copyright © 2014, p. 7
60% of Respondents are Director-Level or Higher
Supply Chain Insights LLC Copyright © 2014, p. 8
Agenda
Study Overview
Supply Chain Performance
Supply Chain Center of Excellence
IT Systems and Spending
Supply Chain Insights LLC Copyright © 2014, p. 9
Nine-in-Ten Have a Supply Chain Organization
Supply Chain Insights LLC Copyright © 2014, p. 10
On Average, Supply Chain Organization Has Five Functions Reporting into it; Leader Typically Reports to
CEO,COO or President
Supply Chain Insights LLC Copyright © 2014, p. 11
Top Supply Chain Descriptive Challenges Two Years Ago:Room for Improvement, Reactive, Traditional,
Silos and Cautious
Supply Chain Insights LLC Copyright © 2014, p. 12
Many More Supply Chain Descriptive Strengths Today:Global, Many, Controlled, Pull, and Aligned
Supply Chain Insights LLC Copyright © 2014, p. 13
Greatest Improvements in POSITIVE Descriptors:Global and Modern
Supply Chain Insights LLC Copyright © 2014, p. 14
Greatest Improvements in NEGATIVE Descriptors:Functional Silos and Reactive
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Descriptors to Work on – Then & Now:Working Well, Risk-Taking, Fast, Agile, Modern,
Outside-in, and Proactive
Supply Chain Insights LLC Copyright © 2014, p. 16
Descriptors to Work on – Then & Now:Room for Improvement, Cautious, Traditional
and Reactive
Supply Chain Insights LLC Copyright © 2014, p. 17
Top Supply Chain Descriptor Two Years Ago vs. Today: Room for Improvement vs. Global
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Top Areas of Supply Chain Pain:Executive Team Understanding and Data Access
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Shortening Lead-Times Is Top Pain for Discrete IndustriesVs. Actionable Analytics for Process Industries
Supply Chain Insights LLC Copyright © 2014, p. 20
Top Areas of Supply Chain Focus:Saving, Demand Planning and Lean Processes
Supply Chain Insights LLC Copyright © 2014, p. 21
Top Focus for Discrete: Improving Demand PlanningTop Focus for Process: Saving Costs
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Top Supply Chain Trends:Data Visualization, Supply Chain Visibility and
Demand Sensing
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Top Trend for Discrete: Big DataTop Focus for Process: Supply Chain Visibility
Supply Chain Insights LLC Copyright © 2014, p. 24
Additional Supply Chain Challenges:Speed, Agility, Alignment, Visibility
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Agenda
Study Overview
Supply Chain Performance
Supply Chain Center of Excellence
IT Systems and Spending
Supply Chain Insights LLC Copyright © 2014, p. 26
Nearly Half Reporting Having a Supply Chain Center of Excellence
Supply Chain Insights LLC Copyright © 2014, p. 27
Primary Functions of Center of Excellence:Best Practices, Metrics and Strategy
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Largest Gap in Center of Excellence Performance vs. Importance:
Definition of Supply Chain Metrics
Supply Chain Insights LLC Copyright © 2014, p. 29
Agenda
Study Overview
Supply Chain Performance
Supply Chain Center of Excellence
IT Systems and Spending
Supply Chain Insights LLC Copyright © 2014, p. 30
13 or More Operational IT Systems on Average;45% Have More Than 10 Systems
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Most Common IT Systems:Order Management and ERP
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Among Most Important and Most Satisfactory:Order Management and Demand Planning
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Greatest Gaps in IT System Importance vs. Satisfaction:ERP, Order Management, Demand Planning
and Production Planning
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7% Use Cloud-Based Delivery for 1+ IT Systems,17% Use Business Process Outsourcing for 1+ Systems
Supply Chain Insights LLC Copyright © 2014, p. 35
Cloud-Based Delivery Most Common for Tactical Supply Planning; Business Process Outsourcing Most Common for
Warehouse Management
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Top Current/Planned Areas for Using Cloud-Based Delivery:Tactical Supply Planning and Demand Planning
Supply Chain Insights LLC Copyright © 2014, p. 37
Top Current/Planned Areas for Using Business Process Outsourcing:
Warehouse Management and Transportation Planning
Supply Chain Insights LLC Copyright © 2014, p. 38
Over Half Expect Company to Spend More on Supply Chain Technology in 2014
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Discrete Industries Are More Likely to Expect aDecrease in Supply Chain Technology Spending This Year
Supply Chain Insights LLC Copyright © 2014, p. 40
Technology Spending Focus in 2014:Demand & Supply Planning, ERP, SAP, SC Visibility
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Most Common Areas for Increased Spending:Supply Chain Planning & Execution, and
BI Analytics & Reporting
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For Half, IT and Supply Chain Jointly Decide onSupply Chain Technology Funding