Supply chains gear up for growth

13 November 2012

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13 November 2012 | Adam Leach

Supply chain professionals are taking a cautiously optimistic approach in their supply chain strategies as they plan for an upturn in demand, according to KPMG.

Supply chain agility: managing change, published yesterday by global accountancy firm KPMG, found supply chain professionals are still acutely aware of volatility and continue to keep a tight grip on costs. But a number believe they have reached the bottom of the curve and are moving forward and preparing for growth.

Speaking to SM, Andrew Underwood, partner at KPMG supply chain in the UK and author of the report, said: “Organisations are feeling that it is time to start thinking about how they would be able to respond to an increase in demand and still deal with the level of volatility that is out there. A number are really preparing for an upturn.”

The report, based on the responses of 80 companies across the globe, found that to gear up for growth, companies are taking measures such as integrating sales and operational planning teams more closely to improve demand planning. It also found a number of companies are setting up shared service centres to centralise order taking, financing and logistics planning.

Underwood explained that while companies are still looking to find savings, a lot of the work is targeted towards lowering costs while increasing efficiency. He said a number of companies were starting to adopt lean methodology to better manage the amount inventory held.

The report highlighted that there are still significant concerns throughout supply chains that costs will rise. In particular, it cited the development of carbon taxes and where exactly in the supply chain the additional costs will fall.

“Many will be keenly watching for 2014, when Australia’s carbon tax expands to encompass the transportation sector, to see how this will impact on costs across the supply chain,” it said.

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