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13 December 2011 | Angeline Albert
The desire to cut costs in 2012 will result
in leaner supply chains and leave companies more exposed to risk, according to
forecasts by Progress Software Corporation.
The company said events such as the Thai floods
and Japanese tsunami made businesses reconsider the level of risk exposure
supply chains have when reliant on a small number of vendors. As a result, “organisations
will attempt to avert risk by on-boarding new suppliers.
However this will be a challenge as relationships and business trust are not
developed overnight,” the company stated.
The company based its predictions on market
trends seen among its 140,000 clients during the past 12 months.
Henry Hicks, industry vice president of
supply chain at Progress, said that to be successful, supply chain managers
needed to gain up-to-date visibility, understand the impact of events and react
quickly. “Organisations that are able to quickly recognise changes in the
supply chain and quickly implement a plan of action to circumvent the issue
will be the real winners,” he said.
The company also forecast greater reliance
on logistics firms for services such as warehousing. Companies will also make
better use of information they gain from suppliers, such as inventory volumes,
to improve supply chain planning.
The CFO is also expected to become more
interested in supply chain activity because of the uncertain economic climate, as was anticipated last month.