European Manufacturers' Fears Hampering Supply-Chain Benefits

Jan. 13, 2005
Europe's ability to boost its industrial competitiveness is being hampered by the reluctance of company bosses to share information with suppliers. That is the view of Arthur D. Little, the management consultancy, which reports that top executives are ...

Europe's ability to boost its industrial competitiveness is being hampered by the reluctance of company bosses to share information with suppliers. That is the view of Arthur D. Little, the management consultancy, which reports that top executives are prey to fears that manufacturing secrets could be leaked to rivals. Headaches of this type frequently crop up when manufacturers devise new techniques to swap data with suppliers. Industrialists are particularly reluctant to reveal inventory levels and new designs. This reticence counters their own strategy of speeding up deliveries and product development and of cutting warehouse stocks. Luc Chalmet, head of Arthur D. Little's Brussels office, says: "Inventory levels are a particularly sensitive issue. Managers fear that giving out too much information to a supplier could reveal that the manufacturer is about to launch a new product." Companies most reluctant to share data are principally in the highly competitive consumer goods sector. But automotive groups score better marks because sharing of information is a well tested and respected tradition in this business.

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