Saving Supply Chain Management from Its Slump

Like most enterprise resource systems, supply chain management (SCM) is experiencing a shift toward the SaaS model. But perhaps unlike similar services, this move to on-demand represents standardization over a greater reach than SCM had before, and is projected to rescue SCM from the veritable slump the sector’s been in this year.

Companies are increasingly cutting costs, worrying about their carbon footprint, and expanding internationally, and supply chain investment has petered out as the software segment saw only a 2% growth this year. Though the transfer to SaaS is expected to help SCM, the demand has been little thus far, and it appears supply chain needs to be reconfigured to adapt to the times.

There have been major changes to the supply chain landscape recently: globalization and outsourced manufacturing leave companies dealing with tiers of supply chains. Also, while previous linear supply chain systems had an inside-out focus, now SCM developers need to find a way to optimize enterprise first and then concentrate on the sell side of things. While issues of a part or component’s source used to be paramount, now companies need to focus on finished products—mastering the demand details and then centering on the supply side.

A possible solution to the SCM flatline is to embrace the idea of managing all resources in motion, expanding systems from simply managing manufacturing and delivery. Integrations to provide real-time data, and essentially standardize across multiple partners, is what’s in store for supply chain’s future.

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