The Digital Supply Chain Challenge

INTRODUCTION STRONG CONVICTIONS IN A

CHANGING SUPPLY CHAIN WORLD The challenges facing supply chain professionals are changing rapidly. These executives used to be expected to deal with working capital, operating costs and first-order customer service. In many companies, supply chain worked in the background, trying to keep operations smooth and all the stakeholders happy. But change has been afoot for many years – just think of the challenges of starting up a supply chain from scratch today compared with 25 years ago. The rise of contract manufacturing as a prevalent, viable option has made the make- vs.-buy decision for small companies a much easier calculation. The use of third- party logistics providers (3PLs) has exploded. In the United States, for example, the 3PL market increased five-fold from 1996 to 2014. * These trends have quietly transformed the supply chain profession. There is now less emphasis on capital expenditures and traditional logistics skills like warehousing and transportation. Supply chain executives are finding that expectations of their role have moved to include more business-facing activities, particularly in the areas of planning and customer relations. Companies have begun thinking about end-to-end planning, becoming serious about demand planning and aligning different actors in the company such as sales and finance. They have come to see customer care as an opportunity for competitive advantage in traditional distribution channels, rather than an order-to-cash

*  “US and global third-party logistics market analysis is released.” Press release. Armstrong & Associates, May 22, 2011. https://www​.3plogistics​.com​/u​-s​-and​-global​-third​-party​-logistics​-market​ -analysis​-is​-released​-3​/.

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