SCM moves up manufacturers' agenda

24 October 2011

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24 October 2011 | Adam Leach

Almost three quarters of US manufacturers see supply chain management as important for the next five years but less than a third are on their way to being world-class at it, according to a report.

The Next Generation Manufacturing(NGM) Study, commissioned by the American Small Manufacturers Coalition and published last week, found that 72.2 per cent see supply chain management as important or highly important to the success of their organisation, a rise of four per cent from 2009.

However, the study, which surveyed 824 manufacturers, found that despite its increasing importance just 29.4 per cent believe they are at or progressing towards world-class SCM status. Referring to the disparity, the report said: “The execution gap represents a substantial barrier to long-term success for US manufacturing.”

The findings also revealed a significant split in the quality of SCM at small and large organisations. The survey found that 25 per cent of small manufacturers – businesses with less than $10 million in annual revenues – believe they are at or getting near world-class status, compared with 41 per cent of large organisations (those with annual revenues of $100+ million).

Carrie Hines, executive director at the coalition, said: “The manufacturing industry is widely recognised as a critical component of America’s economic recovery, but it is important that we provide small manufacturers with the tools to continue to be competitive in the global market.”

The study, which followed up from an initial 2009 survey, found that the issue rising furthest up the business agenda was sustainability. In the latest report, sustainability was identified as a business priority for the next five years by 59.2 per cent of respondents, a rise of 24.1 per cent on the 2009 figure.

 


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