10 Mega trends for Purchasing and Supply Chain Management — where will you be in 2020? — Zycus Procurement Blog
10 Mega trends for Purchasing and Supply Chain Management — where will you be in 2020?
Developing Strategies for Success by Bill Michels
Zycus welcomes a guest post from Bill Michels, CEO at Aripart Consulting.
2015 was becoming the year of the merger, which means industry consolidation, mega-mergers and industry consolidation across most supply chains. This trend is driving many companies to develop exclusive, integrated, competing supply chains. Companies that have advanced this practice are Apple, Samsung and Toyota with end to end integration serving the final customer. The key drivers of this type of supply chain are cost transparency, value creation, integrated business systems and innovation. Is your company on top of the trends that shape your supply chains?
Mega trends are large, trans-formative, global forces that tend to define events for the future.
These trends will define our talent needs, organization structures, processes, systems and strategies for the future. The key to success for our organizations is analysis of global mega trends to translate them into mega trends for procurement and supply chain management.
In my analysis of the trends, I have determined 10 key mega trends for procurement and supply chain. They are:
1. Supplier relationship management is becoming a core competency
2. Value creation is more desired that price management in the future
3. Innovation transfer is required for the success of the entire supply chain
4. There is a movement toward portable manufacturing
5. Contingent work forces are becoming more prevalent in business
6. Internal and external collaboration is a business requirement
7. Business strategy alignment will be required between all links in the supply chain
8. Distribution, logistics and asset management will continue be a bigger priority
9. Agility, flexibility, integration, transparency and alignment will dominate competition
10. Life cycles are becoming shorter
Procurement has been evolving to keep pace with the changing trends. I’ve seen many companies struggle to keep up — those who make the investment to develop skills and improve processes succeed. The procurement profession has made tremendous leads moving from simply price management to a version of sophisticated strategic category management. When you look to the future, it becomes very clear that we will move away from category management into supply chain value management.
There is an accelerating trend towards greater integration of supply chains in terms of demand and supply management, new product development, lean production and shorter product life-cycles. This is being driven by the need to respond quickly to the trends and requirements of ever more demanding customers and consumers. While it’s true no one can predict the future, ignoring the mega trends could lead to a serious competitive disadvantage, new more agile competitors, declining market share and potential failure. What will you do next?
