IT firms suffer supply chain disruption

5 February 2009

05 February 2009 | Jake Kanter

The increased complexity of supply chains has meant that almost two thirds of IT firms have experienced disruption to their network in the past three years.

Some 65 per cent of 140 supply chain managers in the US, Japan and Germany surveyed by Microsoft and Infosys have had to deal with problems in their supply base. The study also found that there were often hours between a disruption occurring and these being updated on systems, with firms losing money as a result.

Respondents said increasing complexity of chains and a greater number of vendors in different countries were to blame for the disruptions. Over a quarter of the firms, 29 per cent, outsource half of their production to third parties. And 40 per cent of companies anticipate their supply chain will become more complicated over the next two years, despite the economic downturn. The report also said businesses lacked visibility over supply chain information. Many companies said too many vendors with different supply chain software and a lack of industry standards were reasons for their poor oversight. Improving supply chain software was the priority for improvement for 36 per cent of companies. A further 35 per cent want better market intelligence and business reporting.

SMfeb2009

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