Supply and demand are getting misaligned and manufacturers need to re-evaluate strategies to get the market back into balance.
That was a key message delivered in a late June webinar we held about manufacturing and the supply chain, offering insight on planning for the future. If you missed it, I encourage you to listen to Lisa Anderson’s insights (see sidebar below).
In addition, she says that plans made in the past are no longer valid and that a new, immediate strategy is needed, along with a 3-month and a 9-month strategy to leverage existing opportunities and create new ones.
End-to-end supply chain visibility isn’t new, but with medical manufacturing feeling the impacts of the pandemic, re-evaluating supply chains and looking to digital transformations have become more important. And a recent survey offer insights.
Fictiv’s 5th annual 2020 State of Manufacturing Report found severe levels of COVID-19 disruption and a clear industry commitment to digital transformation. Findings show only 17% gave top marks to their supply chain’s performance (when asked to grade on an A-F scale). Looking deeper, 83% agree COVID-19 has been an extreme test to their supply chain; 95% are working to increase their supply chain agility; 91% plan to adopt dual- and triple-sourcing strategies; 84% say they will be more cautious about off-shoring; and 73% have minimized or have plans to minimize reliance on China.
When asked about digital transformation initiatives, 87% responded it was a high priority, yet only 14% believe those digital initiatives are well funded. A wide range of business goals were stated for following a digital transformation, ranging from reducing costs (46%) to adapting to a more virtual world (44%), increasing supply chain visibility (42%), driving efficiencies (40%), and accelerating time-to-market for new products (37%).
With digital transformation initiatives a high priority for many, 81% note they face difficulties in finding expertise. “The lack of expertise available in the market to help drive those benefits is a significant drag on the ability to succeed,” the report authors note. This is “all the more reason for digital manufacturing partnerships to play a powerful role in driving critical change.”
While Fictiv’s report dives into many other aspects of supply chain and digital transformation, a key takeaway is “companies’ investment in manufacturing partnerships to make supply chains dramatically more agile, predictable, and resilient will gain a significant competitive advantage in their markets.”
How are you embracing digital transformation and securing your supply chain?
Elizabeth Engler Modic