Supply chains to transform in 2012


All types of industries will be affected by several changes developments around the world.

According to Tompkins International's Strategies to Transform Your Supply Chains in 2012 report, these trends will include the growing presence of China, the expansion of global operations and the need to operate supply chains based on demand.

While the growth of China and the expansion of businesses have been happening for some time, the demand-driven supply chain is relatively new, said Tompkins International chief executive officer Jim Tompkins.

 supply chain changes ahead

This is because companies wish to carry less merchandise and manage operations more efficiently. In effect, the traditional method of simply pushing products to market and hoping for success is being transformed into pulling goods into already existing sales.

This customer-focused technique allows supply chain managers to base their operations off educated sales forecasts.

Additionally, 2012 will also see an increased amount of merger and acquisition activity, allowing for larger corporations to gain a competitive advantage over smaller rival firms.

"To create higher value with [merger and acquisition] activity, it is important that companies redouble their efforts on two critical requirements: speed and due diligence," said Tompkins. "You want to ensure that you get the deal before the other guy gets it, but at the same time, you need to make certain that you have the right business combinations throughout your supply chain."

Several trends will be necessary in order for supply chains to succeed this year. For example, visibility will be much more important in 2012. This means that supply chain managers will need to be able to see how partnering firms are operating during exceptional times. This will be especially imperative after witnessing the catastrophes in 2011 brought on by the economy and natural disasters, according to a Supply Chain Digital report.

Another trend that will likely emerge is the convergence of digital and physical supply chains, along with the increased use of collaboration solutions. By converging these two types of supply chains and using solutions that improve communications from end to end, deliveries will be completed faster and more efficiently, Supply Chain Digital noted.

In the end, administrators need to prepare themselves for the changes that will likely occur in 2012 in order for supply chains to remain productive.