Skip to content
Search AI Powered

Latest Stories

Gartner Supply Chain Symposium 2024

From drift to drive: Gartner keynote address emphasizes how to create a value-driven supply chain in post-pandemic world

Supply chains must focus on initiatives that deliver multiple forms of value and see disruption as opportunities to seize competitive advantage, says Gartner analyst.

IMG_7772.jpeg

Emerging from a prolonged period of disruption and crisis, many supply chain leaders now face the daunting prospect of losing the influence and clout that they gained during the pandemic. To fight back against that slide, supply chains need to focus on delivering value for the business, according to Tom Enright, research vice president for the Consumer Retail team of the analyst firm Gartner.

Speaking during the opening keynote address at the Gartner Supply Chain Symposium/Xpo, Enright says that the analyst firm has heard rumblings that many companies are returning to the traditional view that supply chains should be mainly focused on managing costs and increasing efficiency. However, supply chains that don’t focus on creating value, according to Enright, become trapped in what he calls “a state of drift.”


“Drift is Insidious.” Enright says. “Once you’re in drift, you’ll be under multiple forms of negative pressure. The pressure to deliver quick wins, the pressure to react to the priorities of others, the pressure to do even more with even less. You’ll become the victim of conflicting business goals.”

Instead, supply chain organizations must drive their own destiny and strategic priorities by taking three steps, said Enright:

  1. Define your yes and know your no: This involves defining for your team and partners the landscape of business segments that you will and will not operate in
  2. Enable your “yes” with a multi-role supply chain organization: According to Enright, supply chain organizations need to establish which activities should be standardized and conducted at an enterprise level and which should be differentiated and conducted at a business unit or segment level.
  3. Do your “yes” well with multi-value plays: Enright emphasized that business value must be created on multiple fronts and not just on cost reduction.

“Now, I know I am playing to the home crowd here, but seriously? Anybody who thinks that organizations can thrive by viewing the supply chain as a cost center is just plain flat wrong,” said Enright to applause from the audience.

Instead, companies need to take a “cost and” approach, where initiatives are designed to create multiple forms of value such as cost and a focus on sustainability, cost and a focus on commercial innovation, or cost and a focus on risk reduction.  

For example, when retailer Target repurposed 10 local stores to become distribution centers, it achieved not only the sustainability goal of reducing emission but also the service goal of improving same-day delivery by 150%. Finally, it helped to reduce costs by creating $30 million in savings.

From resilience to antifragility

In addition to designing supply chain initiatives to create multiple forms of value, Enright advocated for seeing disruptions and uncertainty not as something to be managed but as an opportunity to produce value.

While the pandemic created an awareness of the importance of creating a resilient supply chain, Enright argued that organizations need to take that one step further to create “antifragile” supply chains.

Enright said that a resilient supply chain absorbs a disruption but does not see a loss or gain because of the disruption. An antifragile supply chain creates opportunity and even more value in the face of disruption and uncertainty.

While the path to antifragility is still being studied, Enright says some basic characteristics include an investment in redundancy so that the organization can shift production, supply and operations from one physical location to another when an event occurs; a focus on training and certifying operational staff in diverse skills and capabilities; and a culture of collaboration.

“Supply chain leaders are in a unique position to drive value during uncertainty,” said Enright. “You work in reality, and your people are equipped to bridge gaps understanding during moments of disruption.”

Recent

More Stories

photos of white house and a loaded containership

Supply chain groups push back on Trump tariff plan

Industry groups across the spectrum of supply chain operations today are pushing back against the Trump Administration plan to apply steep tariffs on imports from Canada, Mexico, and China, saying the additional fees are taxes that will undermine their profit margins, slow their economic investments, and raise prices for consumers.

Even as a last-minute deal today appeared to delay the tariff on Mexico, that deal is set to last only one month, and tariffs on the other two countries are still set to go into effect at midnight tonight.

Keep ReadingShow less

Featured

NMFTA to release proposed freight classification changes this week

NMFTA to release proposed freight classification changes this week

The less-than-truckload (LTL) industry moved closer to a revamped freight classification system this week, as the National Motor Freight Traffic Association (NMFTA) continued to spread the word about upcoming changes to the way it helps shippers and carriers determine delivery rates. The NMFTA will publish proposed changes to its National Motor Freight Classification (NMFC) system Thursday, a transition announced last year, and that the organization has termed its “classification reimagination” process.

Businesses throughout the LTL industry will be affected by the changes, as the NMFC is a tool for setting prices that is used daily by transportation providers, trucking fleets, third party logistics service providers (3PLs), and freight brokers.

Keep ReadingShow less
Jump Start 25 conference opens in Atlanta

Jump Start 25 conference opens in Atlanta

Artificial intelligence (AI) and the economy were hot topics on the opening day of SMC3 Jump Start 25, a less-than-truckload (LTL)-focused supply chain event taking place in Atlanta this week. The three-day event kicked off Monday morning to record attendance, with more than 700 people registered, according to conference planners.

The event opened with a keynote presentation from AI futurist Zack Kass, former head of go to market for OpenAI. He talked about the evolution of AI as well as real-world applications of the technology, furthering his mission to demystify AI and make it accessible and understandable to people everywhere. Kass is a speaker and consultant who works with businesses and governments around the world.

Keep ReadingShow less
trends in robotics

IFR: five trends will drive robot growth through 2025

As the global market value of industrial robot installations passes its all-time high of $16.5 billion, five trends will continue to drive its growth through 2025, according to a forecast from the International Federation of Robotics (IFR).

That is important because the increased use of robots has the potential to significantly reduce the impact of labor shortages in manufacturing, IFR said. That will happen when robots automate dirty, dull, dangerous or delicate tasks – such as visual quality inspection, hazardous painting, or heavy lifting—thus freeing up human workers to focus on more interesting and higher-value tasks.

Keep ReadingShow less
graphic of cargo in motion

Disruption events to global supply chains rose 38% over 2023

Overall disruptions to global supply chains in 2024 increased 38% from the previous year, thanks largely to the top five drivers of supply chain disruptions for the year: factory fires, labor disruption, business sale, leadership transition, and mergers & acquisitions, according to a study from Resilinc.

Factory fires maintained their position as the number one disruption for the sixth consecutive year, with 2,299 disruption alerts issued. Fortunately, this number is down 20% from the previous year and has declined 36% from the record high in 2022, according to California-based Resilinc, a provider of supply chain resiliency solutions.

Keep ReadingShow less