2010: The Year of CUTS?

According to a recent piece over on Supply Chain Digest that chronicled the Supply Chain Guru Predictions for 2010, this will be the year of CUTS:

  • Consolidation,
  • Uncertainty,
  • Training, and
  • Specialization.

In other words, the year will be pretty bleak. We’re already at the point where, with the exception of BIQ‘s inclusion of a new Computed Measures Language as part of their spend/data analysis package , I haven’t seen anything truly innovative on the technology side in over a year.

I’ve seen lots of great stuff, but almost all of it falls into the better, faster, cheaper category. For example, the recent upgrade to Trade Extensions‘ platform, which can now handle Billion-dollar sourcing projects with over 60,000 lanes and 400,000 bids in a single model, is incredibly powerful and really (really) cool (because even five years ago it was hard to imagine being able to solve such a problem on anything less than a supercomputer), but it’s still just a (large) incremental improvement on fundamental technologies and capabilities they’ve had for a few years. Rollstream‘s enterprise community management application, built on the better principles of social networking, is really slick, but not a fundamentally new idea. And SupplierSoft‘s integration of their full SRM platform into SalesForce, which gives customer organizations a 360° supply chain view through a single platform, is a unique implementation, but P2P, SIM, SRM, and (Environmental) Compliance solutions are not new.

Now, you might say that the fact that organizations are finally expected to focus on training is a good thing, because it makes your people more productive and, in supply chain in particular, can deliver amazing ROI, but most companies are not going to do it out of respect for their employees. They’re going to do it because they think it will allow them to shovel even more work onto their already overworked employees, delay hiring, and continue to contribute to the jobless recovery in a negative fashion.

And when you dig deeper into the predictions, you see that consolidation is referring primarily to consolidation of supply chain assets, which sounds good at first (more use, revenue, and thus profit per asset), until you realize that having all assets almost 100% utilized allows no room for growth. And you see that uncertainty means that no one is willing to step up and say “this is the year we’re going to recover, economy be damned” which means another year where the majority of companies are going to just hunker down and hope “magic happens” before they go broke. And while specialization, or, in the words of Art Mesher, selective specialization, sounds great, since that presumably means that supply chain systems will get better and better, until we have an open source standard for supply chain data interchange, the visibility nightmare is going to get worse before it gets better.

All I can say is that it’s time to Shape Up or Ship Out, and by that I mean either get on with your business or shut down operations and make way for someone who will. Magic isn’t going to bring the economy back, hard work and forward momentum is, and someone has to start it. Due primarily to the large positive impacts that Supply Management has on the balance sheet, it has the potential, but only if it’s willing to step up, use it, and drive the business.

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