The Future is Coming!

As my loyal readers will know, I started the “Future of Sourcing” craze right here on this blog last August. By bringing all of the bloggers together and focussing them on one topic, I’ve managed to organize over two dozen of the leading minds in the sourcing space on one very important issue – your future. And when that many thought leaders speak out, it’s bound to be noticed. (As the bandwidth stats for this blog will confirm!) And then when it happens again, as it did again this fall, people start thinking. And once you start thinking, if you’re like me, you can’t stop.

And if you’re inspired, you’ll want to publish something about it – just as the Supply Chain Management Review did – twice! That’s right – they were so inspired, that not only did they publish Robert Monczka and William Markham’s The Future of Supply Management – Part I: Category Strategies and Supplier Management back in September, but they also published Joseph Carter, Thomas Slaight, and John Blascovich’s The Future of Supply Management – Part 2: Technology, Collaboration, Supply Chain Design last month. Looks like I’ve started a trend that you’re going to benefit from!

Anyway, in their paper, Carter, Slaight, and Blascovich predict that in the sourcing world of tomorrow, demands will be more diverse and complex, companies will have multiple – complex – supply chains, internal and external collaboration will be more important, and technology will become a key enabler in managing diversity and complexity. And you know what – they’re right.

Let’s face it – today’s average purchaser isn’t sourcing staplers, iron ore, and drums of bleach. They’re sourcing iPods and servers and GPS controllers and temporary labour services. Demands are becoming more diverse and complex everyday and you have to be ready. Furthermore, it’s not just the inbound supply chains that are important, but the outbound supply chains, because you have to be ready for reverse logistics when products break and you have to take them back and either fix them or dismantle them and then charge your supply base according to warranties and agreements in place. When most of the work is done by contract manufacturers, internal collaboration with the R&D team and external collaboration with supply partners become more critical. And with product life-cycles shrinking every year, technology is going to become critical to managing the complexity.

The article points out that, in the sourcing world of tomorrow, competitive advantage will require agility and supply chain excellence will be defined by the ability to:

  • anticipate changes in customer requirements, product offerings, supply conditions, regulations, and competitor actions
  • adapt to changes by deftly reconfiguring existing supply chains
  • accelerate implementation of change to capture new opportunities

When it comes to collaboration:

  • internal collaboration and integration must advance further if companies are to capitalize on future needs
  • external collaboration will signal a shift from pure competition to partnership for some segments of a company’s supply base
  • technology will be required to enable an increase in collaboration
  • the tension between the potential for strategic advantage through supplier collaboration and the concerns about managing risk and protecting IP will not be resolved easily

As for technology, the authors asked what supply executives wanted, and what they answered was ease of access, both internally and externally; visibility through web-based tools; collaboration platforms for everything from product development to operations to schedules, tracking and simulation; newer and more powerful tools for risk, compliance and supply market analyses; and user interfaces that can be grasped as intuitively as they experience personally as consumers. Not a bad start.