scm
Future structural changes in supply chains
Filed in archive Market Overview by ehsan on April 27, 2009
Future structural changes in supply chains
Bob Ferrari of Supply Chain Matters Blog recently had a Q&A with Kinaxis which he has published on his blog (Read it here). The topic of the discussion was around the new trends in supply chain space and the structural changes which are coming.

I liked Bob's point of view a lot in this Q&A. Carefully looking at the dynamics of the industry and economic landscape, he made very logical conclusions about the future supply chain changes. Specifically speaking, the biggest structural changes in his point of view can be categorized into three main chunks:

- Global Manufacturers now operate over 700 development centers in China and India: This might be considered not only as a low cost development center but also as a new force in product innovation. As authors Williamson and Zeng suggest, we could see entire value-chains established within a geographic region.

- Outsourcing and contract manufacturing changes: There is some opinion that contract manufacturers themselves, who have no choice but to maintain the most cost competitive and productive capacity, will dis-intermediate their brand-owner customers by establishing their own brands and global product distribution, as pointed out by Randy Littleson and Trevor Miles.

- Political and environmental risks are also playing an important role: High unemployment, a rising voice from consumers for buying local, as well as nd other political forces in China, Europe and the U.S.manufacturers to revisit their outsourcing or near-shoring strategies. Politicians are under the gun to protect domestic jobs and insure their country's competitiveness in tomorrow's products and technologies. Consumers demand safety for the products they purchase, and demand that manufacturers have transparency in quality control and consistency. The existence of the brand itself hangs in the balance.

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Tags: structural  changes  in  scm  value  chain  logistics  future  supply  supply+chain 
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