Supply Chain Barometer 2012: Insights on Supply Chain Agility

| Point de vue

Fluctuating demand and market uncertainty: How to meet the challenge?

The competitive business landscape and ever-evolving customer demands are reshaping traditional supply chains. First, globalization is increasing complexity, extending supply chains’ scope to leverage low-cost sourcing options, and to access emerging markets. The movement of manufacturing facilities towards future key markets, and their reliance on new geographical clusters, creates a complex web of mutual dependencies, exposed to multiple risks. Furthermore, organizations are led to operate a broad range of supply chain models simultaneously, such as Make To Order, Make To Stock, Assemble to Order, etc.

In addition, power has shifted along extended supply chains. To ensure effectiveness, it is imperative to collaborate with upstream and downstream partners. At each end of the chain, new challenges are emerging. Raw materials and energy procurement costs become a growing concern. Simultaneously, customer data and market intelligence are crucial aspects to result in profitable sales in a growing digital world.

In addition to complexity and power shift, supply chains are also facing a higher rate of change and a higher volatility in demand and markets. Heterogeneity in markets prompts organizations to widen product portfolios and to update them more frequently. To survive the competition, organizations need to deal with shorter timelines to close in on additional sales offerings, additional products categories, and to develop in new countries, through new delivery channels.

Companies’ ability to anticipate and adapt to unexpected events is crucial. Those who cannot face this context in a rational and controlled way jeopardize their profitability and sustainability.