Lean Tops List As Highest Supply Chain Strategy

Next in line were operational improvement programs.

Almost half of the companies surveyed on their top supply chain initiatives named lean supply chain as their top priority. The survey, conducted by E2open, a Redwood, Calif.-based supply chain management software company, was based on interviews with 160 participants at the SAP Logistics and Supply Chain Management 2007 conference.

Survey respondents validated the highest-priority supply chain initiatives:

  • 48% of survey respondents identified lean supply chain eliminating waste and unnecessary steps, for example, by evolving from a "push" to "pull," demand-driven strategy;
  • 45% identified operational improvement programs -- obtaining visibility into supply chain information by replacing manual processes with automation (automated VMI/SMI programs, IPO/ITC, etc.);
  • 39% identified globalization -- leveraging economies of scale across multiple operating units;
  • 29% identified improvement in trading partner integration by migrating from legacy systems to multi-enterprise supply chain platforms replacing legacy collaboration applications and B2B gateways.

Additional initiatives identified by respondents included outsourced manufacturing and design as well as operating and sourcing in low-cost countries such as China, Southeast Asia, Eastern Europe and Latin America.

Survey respondents also cited the top business objectives for their supply chain initiatives as follows:

  • 66% cited reducing operating costs;
  • 52% cited reducing inventory;
  • 41% cited improving on time delivery;
  • 39% cited improving availability and cycle times.

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