- Many industrial organizations have long used relatively traditional commercial models focused on selling a limited range of products or services. However, the viability of this approach is being undermined by a number of trends, including an increasing talent shortage, disruptive technology, and tightened fulfillment timelines, according to a recent report by L.E.K. Consulting.
- As a result, many leaders are pushing strategic shifts in their value chain and honing their focus to activities likely to increase value. Whether it's product customization, greater supplier engagement, or outsourcing their capabilities, executives are more willing to engage in change than before, per the report.
- Based on their findings, the consultancy recommends increasing efforts on recruitment, potential restructuring, embracing disruptive technology, digitizing, and shifting their distribution and sales models away from the end user to treat the consumer as a priority.
The report, targeted to the manufacturing executive, is great news for the supply chain manager. The focus on optimizing the value chain over manufacturing processes or innovations shows the industry is recognizing, more and more, the importance of supply chain management to success.
Perhaps that's why SAP CEO Bill McDermott projected, two weeks ago, that supply chain managers would be the CEOs of the future.
"In the future you will see more supply chain professionals running companies than before." #APICS2016— Edwin Lopez (@EdwinLopezT37) September 25, 2016
However, it is important to note that the shift towards optimizing the value chain is a result of increasing manufacturing duress.
Although the manufacturing sector has seen 88 months of consecutive growth, the recovery from the Great Recession has been slow while the increased demands have been high. Improving processes requires high capital investments, which is often not available.
Meanwhile, honing the focus through lean manufacturing processes and strategic sourcing requires global foresight, technical savvy, leadership, and business acumen — or talent, as posted on Supply Chain Management Review. Recruiting will continue to increase in importance within manufacturing.