Collaboration: Trending at No. 1

collaborationAdrian Gonzalez, founder and president of Adelante SCM and director of Logistics Viewpoints, recently talked about his favorite presentation at the Crossroads 2013: Supply Chain as Future Enabler conference at MIT, and collaboration was a big star.

His post gave the fave-rave to A Vision of Supply Chain Evolution by Tom Linton, Chief Procurement and Supply Chain Officer at Flextronics, who presented his top 10 list of supply chain trends.

I’ll start with Linton’s No.1 supply chain trend, where he said:

#1: “Non-Zero” Supply Chains Win: “In other words, supply chains focused on greater collaboration between everyone in the ecosystem will win. This will result in end-to-end supply chain solutions that will create new value for customers.”

Well, that is certainly music to these ears and it’s especially heartening that collaboration continues to be such a big attention-getter and trend-setter. My thought is that when supply chains drop zero-sum thinking, it’s not only a win, it is a win-win-win as value is expanded and created for companies, service providers and end customers.

Linton’s list, dropping from #10 to #2 follows:

#10: Cloud Computing: Low cost and reliable cloud solutions for global supply chains are starting to emerge; “apps” will transform supply chains.
#9: Business Process Convergence: Instead of automating inefficient processes, companies will eliminate them — e.g., replace inter-company business documents such as purchase orders with sense-and-response systems; companies will more seamlessly integrate inter-company functions.
#8: Global Labor Costs Equalize: Labor arbitrage is in decline as labor costs in Mexico match China’s, and India, Ukraine, and Indonesia become more cost competitive.
#7: Raw Material Scarcity is driving innovation in materials, with companies replacing copper with aluminum, gold with copper, and steel with resin in certain cases. Companies will also need to better manage conflict minerals and rare earth metals.
#6: Skill Specialization: New supply chain skills will emerge, such as managing supply chains in the cloud, and undergraduate and MBA programs will become more specialized.
#5: Regional & Local Sourcing will expand and supply ecosystems will emerge as economies grow; “Made in USA” and “locally-sourced” will drive sourcing.
#4: Emergence of Control Towers as supply chains become more virtual (few or no factories). Supply chain winners will have a global footprint and be transparent, reliable, and flexible.
#3: Predictable Unpredictability: Predictability becomes a competitive advantage; supply chains break through barriers to become faster, more cost efficient, and safer.
#2: Corporate Social Responsibility Becomes Fundamental: It won’t be an option any more, policies expand globally, emerging country laws catch up, and foreign corporations will follow global norms.

The points from this list that I especially like, in no particular order, are the ideas around equalizing labor costs, process convergence, and CSR becoming “fundamental.”

These are all concepts that Vested acknowledges, embraces and strives to instill.

Listen to Linton’s presentation on MIT TechTV for more details.

And thanks to Adrian for publicizing this fine presentation!

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