A couple of weeks ago, I attended the Crossroads 2013: Supply Chain as Future Enabler conference at MIT, which featured a great lineup of speakers from Flextronics, Pfizer, 7-Eleven, Intel, Johnson & Johnson, UPS, and MIT. I don’t have the time or space to summarize every presentation, but overall the conference was very informative and thought-provoking.
The presentation that I enjoyed the most was A Vision of Supply Chain Evolution by Tom Linton, Chief Procurement and Supply Chain Officer at Flextronics, where he presented his top 10 list of supply chain trends. Here’s his list and comments:
#10: Cloud Computing: Low cost and reliable cloud solutions for global supply chains are starting to emerge; “apps” will transform supply chains.
#9: Business Process Convergence: Instead of automating inefficient processes, companies will eliminate them — e.g., replace inter-company business documents such as purchase orders with sense-and-response systems; companies will more seamlessly integrate inter-company functions.
#8: Global Labor Costs Equalize: Labor arbitrage is in decline as labor costs in Mexico match China’s, and India, Ukraine, and Indonesia become more cost competitive.
#7: Raw Material Scarcity is driving innovation in materials, with companies replacing copper with aluminum, gold with copper, and steel with resin in certain cases. Companies will also need to better manage conflict minerals and rare earth metals.
#6: Skill Specialization: New supply chain skills will emerge, such as managing supply chains in the cloud, and undergraduate and MBA programs will become more specialized.
#5: Regional & Local Sourcing will expand and supply ecosystems will emerge as economies grow; “Made in USA” and “locally-sourced” will drive sourcing.
#4: Emergence of Control Towers as supply chains become more virtual (few or no factories). Supply chain winners will have a global footprint and be transparent, reliable, and flexible.
#3: Predictable Unpredictability: Predictability becomes a competitive advantage; supply chains break through barriers to become faster, more cost efficient, and safer.
#2: Corporate Social Responsibility Becomes Fundamental: It won’t be an option any more, policies expand globally, emerging country laws catch up, and foreign corporations will follow global norms.
#1: “Non-Zero” Supply Chains Win: In other words, supply chains focused on greater collaboration between everyone in the ecosystem will win. This will result in end-to-end supply chain solutions that will create new value for customers.
You can watch Tom’s presentation below for additional details.
Do you agree with Tom’s list? What trends would you add to the list? Post a comment and share your top 10 supply chain trends. I’ll share mine in a future posting.