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Manufacturers embracing retail role to compete with Amazon

Digital supply chain to combat the Amazon effect

According to the 2018 Intelligent Manufacturing survey, 43% of manufacturers are reprioritising and focusing investments in technology on inventory optimisation solutions, with 41% targeting more integrated planning and execution technologies.

Manufacturers are turning towards these investments in response to the “Amazon effect” and current consumer demands.

51% of the responding manufacturers are focusing on enabling both internal and external collaborations throughout supply chains.

41% of manufacturers are targeting demand sensing to improve forecasting, whilst 33% believe data science is the best approach.

“The Amazon and Alibaba effect have significantly compressed consumer order fulfillment delivery time expectations,” stated Fred Baumann, Group Vice President of Industry Strategy at JDA.

“Now, more than ever, planning and execution processes must be more tightly coupled.”

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“Yet even while our data shows a portion of respondents understand the importance of prioritizing both short-term execution and strategic long-term planning, too often we see manufacturing companies focused on one and not the other and it’s limiting the value of their planning efforts.”

31% of the responding manufacturers claim to focus on integrated planning as a means to integrated tactical execution though a single technology.

However, only 18% of the manufacturers claim to have reached digital supply chain maturity.

“Incorporating real-time data inputs across both the planning and execution horizons can further bolster an integrated approach.”

“We found that, as a result of implementing supply chain digitalization strategies or technologies, the subset of respondents who follow an integrated S&OP and S&OE approach reported benefits such as greater profitability (61 percent), increased customer service levels (49 percent) and reduced spend (48 percent).”

Find the survey here.

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