Report: Supply chain management will drive growth in manufacturing industry


Next generation manufacturing companies will drive growth within the industry during the next several years. Such organizations will prioritize the use of technology, feature superior processes, embrace sustainability and put the customer first.

However, perhaps most importantly, firms will focus on developing streamlined and highly effective supply chains through management programs and collaboration with vendors and suppliers.


That was among the findings of the latest Next Generation Manufacturing Study, conducted by NGM in partnership with the American Small Manufacturers Coalition and the Manufacturing Performance Institute.

The study aimed to identify how far U.S. companies have come in implementing so-called next-generation strategies and what must be done to promote their use moving forward.

Supply chain management and collaboration is one strategy highlighted by the report. Such practices should afford better flexibility, response times and delivery performance from the manufacturing process.

In surveying companies for the report, researchers found that 72 percent of respondents felt supply chain community management was a crucial practice. However, just 29 percent of respondents said their programs can be considered "world-class," while another 9 percent said they haven't made any headway in attaining such status.

According to the report, in order for a company's supply chain management to be deemed world class, it must address strategies, talent and development programs, as well as capable business systems and equipment. An organization near or at this level, according to the report, is more likely to consider supply chain management highly important and is more likely to have a full-functioning strategy with enterprise-wide buy-in.

While 58 percent of respondents have a strategy in place, just 15 percent said it was fully functional and had complete buy-in. What's more, just 15 percent have both talent and development programs, while 11 percent sport cutting-edge business systems and equipment to support a highly effective supply chain.

Addressing these areas, the report found, will help companies develop closer relationships throughout the supply chain and improve the process as a whole.

Apple has served as the benchmark as far as top-performing supply chains go. Earlier this year, research firm Gartner said the consumer electronics giant boasts the world's best supply chain, which has allowed for continued success and high-impact product releases.