Improved Relationships

By Jacqueline Emigh  |  Posted 2004-11-02 Print this article Print

Other technologies used include TMS (transportation management systems), 32.5 percent; JIT (just-in-time)/Kanban, 29.2 percent; CRM (customer relationship management) applications, 27.3 percent; CPFR (collaborative planning, forecasting, and replenishment), 22.5 percent; supply chain event management systems, 17.2 percent; SRM (supplier relationship management) applications, 16.7 percent; collaborative product design, engineering and manufacturing applications, 15.3 percent; and RFID (radio frequency identification), 9.1 percent. On a positive note, results indicated that relationships are improving between supply-chain professionals and their IT counterparts within organizations. Only 14 percent of this years respondents said their work relationships around introduction of new technologies were not effective, or only marginally so—in comparison with 39 percent in the same survey last year.
On the other hand, 52 percent of this years respondents said their companies either do not have a supply-chain strategy or are just starting to develop one.
The study also showed some encouraging findings in the area of cost reductions. Twenty-seven percent of all respondents reported that use of supply-chain technology had reduced their costs by 1 percent to 5 percent, while 33 percent obtained cost reductions of between 6 percent and 10 percent. Another 8 percent of respondents cut costs by 8 percent to 11 percent, and 4 percent garnered cost savings of more than 20 percent. Is the shortage of RFID tags a blessing in disguise? Click here for a column. But the impact of supply-chain initiatives on revenues wasnt as clear. About 57 percent of the participants pointed to revenue increases, ranging anywhere from 1 percent to 5 percent. On the other hand, 38 percent answered "dont know/not sure" to this question. Over the longer term, growth in revenues is a more important supply-chain objective than cost reductions, according to Poirier. What are the biggest opportunities for vendors going forward? "I suggest that theyre on the collaborative side," he said. "If I had one piece of advice to give to vendors, it would be to go to a couple of your top customers and get them to collaborate with their major suppliers. "This isnt about beating up on suppliers. This is about saying, for instance, OK, here are some places where we can substitute materials, or where we can draw more [product] through." In other results, 57 percent of respondents said they will make investments in logistics, transportation and warehousing over the next three years. Another 53 percent will invest in purchasing, procurement and sourcing. Other supply-chain investments will include forecasting, planning and scheduling (49 percent); inventory and materials management (42 percent); and SRM/CRM (41 percent). Check out eWEEK.coms for the latest news and analysis of enterprise supply chains.


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