Visit Our Sponsors
Out of the top four supply chain disruptions over the past year (reported by participants in the study cited above), three were related to commodity price and supply volatility. Process industries, such as chemicals, pharmaceutical and bio-tech, being highly dependent on the commodity market, were the ones to be hit the hardest: process industry respondents in this study were 22 percent to 37 percent more likely than all others to report that one of these commodity-related disruptions had impacted their supply chains. At the same time, the reduction in customer demand impacted all of the respondents in similar manner (it was the number one disruption for 61 percent of process respondents reporting it, compared to 63 percent among all others).
Rising costs and growing supply chain complexity are putting increased pressure on process industry supply chains, forcing them to increase the focus on supply chain management. For process industry manufacturers, which have historically been characterized by higher levels of inventory held throughout the supply chain and longer manufacturing and supply chain lead-times, these problems are especially acute. Aberdeen's extensive research on multi-enterprise supply chain management has shown that if companies want to drive significant performance improvements in the context of multi-tiered distributed supply chains, it is critical for them to ensure the adequate level of visibility, integration (both internal and external) and supply chain intelligence. For process industries, where manufacturing is more continuous and sequential than in discrete industries, having close-to-real-time analytics becomes more important, especially within the upstream supply chain and manufacturing stages.
In 2010, process industry companies will continue increasing their emphasis on supply chain excellence, in an effort to reduce network-wide inventory, better monitor events throughout the supply chain, and better assess wide-ranging supply chain risks. The top performers in this sector are emphasizing increased supply chain visibility and better process controls throughout their manufacturing and supply chain processes.
Enjoy curated articles directly to your inbox.