Supply Chain Trends November 6, 2013

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Key Market Trends

§  Centralization of corporate decision making

§  Integration of supply chain

§  Globalization of supply chain

§  Internet (online delivery, networking)

§  Professionalization of workforce (more degrees)

§  Government funding (especially China, Singapore)

§  Sophisticated competition – universities, consulting firms

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Growing Awareness of Supply Chain and Operations Management

The profile of supply chain and operations management professionals is rising.

Major news organizations discuss, e.g., §  Supply chain disruptions (2011 tsunami) §  Bill of materials (Apple products) §  Ethical supply chains (manufacturing work conditions)

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Corner Office: (SCM) Strategy

Executive teams realize that supply chain excellence is a competitive advantage. Traditionally, the advantage was cost reduction: → Operate lean and efficiently → Reduce waste → Reduce inventory → Strategic use of capacity and assets → Low cost labor

Focus now is on value creation for the entire supply chain

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New and Growing SCM Challenges

Supply chain risk § Supplier disruptions

–  Availability of capital; recessions

Globalization-related § Emerging markets as suppliers and customers § McKinsey projects that 1.8 billion people will join the global

consuming class by 2025 expanding demand for products produced across the globe.

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New and Growing SCM Challenges

Sustainability – People, planet, and profit § Satisfy customer expectations § Government regulations

Moving from board room to shop floor

Lack of consensus on definition and measurement of sustainability

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Talent Management is

39.0%

36.2%

17.4%

7.4%

0.0% 20.0% 40.0% 60.0%

More of a problem at mid level

Similar across all levels

More of a problem at senior leadership

More of a problem at entry level

CSCO Report 2011, SCM World

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Talent and High-Performing Supply Chains, Gartner 2011

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Biggest challenges in SC Talent Acquisition

53.0%

32.0%

35.0%

34.0%

35.0%

0.0% 20.0% 40.0% 60.0%

Lack of available skilled or experienced talent

Slow/complex internal hiring processes

Poor leadership, soft skills, or others difficult to develop

Perceived lack of career path or future

Lack of budget to hire needed positions

APICS Research May 2012

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Biggest challenges in SC Talent Development

43%

32%

61%

36%

28%

12%

0% 10% 20% 30% 40% 50% 60% 70%

Insufficient training for technology and processes

Best staff leaving for other positions/employers

Lack of recognition of SC training importance

Meeting compensation and work/life requirements

Developing talent globally

Demographic shifts causing loss of talent

APICS Research May 2012

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Challenges in respect of knowledge workers

CSCO Report 2012, SCM World

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Manufacturing productivity

$13,266

$14,105

$28,051

$28,226

$51,576

$56,208

$60,842

$63,992

$71,529

$76,346

$84,565

$92,960

$118,419

$0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000

China

Brazil

India

Mexico

Spain

Italy

Germany

France

Canada

Republic of Korea

United Kingdom

Japan

United States

Manufacturing value added per worker

Source: NAM

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Businesses are optimistic about their own growth prospects and the global economy

50%

62%

78%

90%

17%

47%

71%

83%

33%

49%

73%

85%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

World economy

U.S. economy

Your industry

Your company

2013 2012 2011

Business optimism year-to-year

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Preparing the workforce

Academic • SC/OM theory • Broad perspective • Safe environment

Company • Internships • Rotational opptys • Real world

experience • Career planning

Association • Professional

development • Mentoring • Certifications • Research/

unbiased

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Questions