Today, Simon Ellis and I presented our Top 10 2011 Predictions for the Supply Chain. The overlying theme for our IDC Manufacturing Insights 2011 supply chain predictions is finding the cadence of growth in a complex world. Given the overall view for manufacturing, we see 2011 as a "back on track" and "back to basics" year.
While we do not anticipate massive IT spending growth for supply chain organizations, there is no question that pent-up demand and a need to push forward with new capabilities are going to drive expenditures in 2011. But at the same time, supply chains are going to be cautious and focus on those things that return high probability benefits.
In addition to seeing 2011 as a year of finding the cadence of growth, we acknowledge that the supply chain is certainly going to be no less complex in 2011. As a result, managing, and capitalizing on, complexity is one of the underlying themes of our predictions. Part of that complexity comes from extending supply chains, as companies broaden their portfolios, their supply networks, and the regions where they serve customers. Keeping this in mind, we've added a prediction about our concept of "profitable proximity sourcing" — the notion that companies should choose their supply networks based on a combination of cost, lead time, and the location of demand, because of its applicability to the complex supply chain.
In the 2010 supply chain survey we conducted of 415 manufacturers, the top supply chain priority was reducing supply chain costs, not surprisingly. We were more interested in the next two priorities – improving forecasting and being more responsive to demand changes. Certainly it should be important to try to improve forecasting capability (particularly if a company lags behind competitors), but it is equally important to be able to respond quickly to the inevitable unanticipated changes to that forecast. In other words, it is increasingly important, given market and demand volatility, to have the ability to be more responsive to demand changes in the marketplace. As a result, balancing forecasting with responsiveness is also a key theme in our predictions.
At IDC Manufacturing Insights we believe that an integrated decision-making environment separates leaders from laggards and can drive truly differentiated business and supply chain performance. You'll find that we've incorporated our expectations for better decision making into our predictions, especially as it relates to practical supply chain visibility with clarity around use cases: traceability, supplier management, and of course, responsiveness, with a balance between cost and service. And when it comes to service, fulfillment excellence is high on the agenda.
Finally, we finish our supply chain predictions with a nod to the challenges of supply chain talent management and the increasing applicability of emerging technologies, including cloud, mobility, and social applications and platforms.
Many of these themes will also be visible in our 2011 supply chain research. We hope you'll listen to our broadcast of the predictions, and please let us know if you have any questions.