Supply chain management survey reveals companies slow to respond to customer needs

Manufacturers are still failing to use web technologies for supply chain operations, despite increasing demands from their customers that make them an obvious choice. A recent survey for the Softworld exhibition and conference organiser Imark Communications finds that only 48% of companies currently use Internet technologies to manage product orders and deliveries, yet over half state that responding to customer demands and improving service is the main reason for changing supply chain requirements. And while 48% might sound good, only 15% use web technologies at all supply chain levels, although 23% say they are planning to implement a web-enabled supply chain “soon”. Surprisingly though, almost half currently outsource parts of the supply chain IT using an application service provider (ASP), a substantial increase on earlier similar surveys. “Earlier in the year when we conducted the research we found that only 37% of companies were using the Internet to streamline their processes,” says Justin Opie, Softworld director. Nevertheless, he points out that the numbers of companies that appear to be appreciating the benefits the Internet can bring to supply chain management are still very small. “There certainly appears to be a gap between identifying the drivers for change, and actually responding to them,” he says. And he adds: “It is interesting to note that outsourcing is a growing trend.” However, it’s important not to draw too far reaching conclusions from this observation: aspects of collaborative forecasting, planning, replenishment and general supplier management operations lend themselves well to ASP treatment, not least because they require a web hub system to work best. The same does not apply to much of the rest of our computing requirements – and it has to be said that the old ‘non core competence’ argument has to be regarded with great caution if businesses want the responsiveness and agility that ownership should provide. Other results from the survey show that over half of companies (67%) currently manage their supply chains on a global level, as opposed to a national level – much more than most would have imagined. As for integration within supply chains, 72% of firms claimed they were integrated internally, but only 20% externally. 28% of respondents plan to integrate “in the near future”.