Supply Chain Frontiers issue #4. Read all articles in this issue.
Supply chains do not have nationalities and excellence can be achieved in any part of the world, but there are regional nuances that distinguish supply chain management models in different geographies.
These regional disparities emerged during the first meeting of the Supply Chain 2020 European Advisory Council this September in Madrid, Spain. Supply chain thought leaders from 12 companies gathered to discuss the research agenda for this multi-year research effort to identify and analyze the factors that are critical to the success of supply chains up to the year 2020.
Supply chains are colored by the societies they are designed to serve. For example, European companies have been dealing with product reclamation and recycling laws for some time, and are likely to be ahead of their North American and Asian counterparts in this area of supply chain management. However, product return processes tend to be more advanced in North America.
Regional market leaders have different operating models. In the United States the dominant players include Wal-Mart as the lowest-priced retailer, Dell as the highest-value provider of computer equipment, and Cisco as the single-source provider of networking equipment.
In Europe supply chain luminaries include the petrochemicals organization Borealis Group, which concentrates on "serving the plastics manufacturing industry with the highest standard of raw materials," according to the Council. Critical to ImBev/Interbrew, the world's largest brewer, is seamlessly integrating various distribution networks. Metro Group is a retailing giant, and in this regard is similar to Wal-Mart, but the European company's strategy is to offer the best value for the total package of products and services it offers--and not necessarily at the lowest price.
A maxim that holds true regardless of location is that understanding the past gives us a better fix on the future. "The project needs to formally and systematically analyze what has happened over time to identify what factors were known and unknown 10 to 15 years ago," the Council advised. Similarly, today there may be disruptive technologies that are relatively unknown that will have a major impact a decade or so hence.
To better understand the future shape of supply chains the Supply Chain 2020 project team will model the outcome of a series of carefully selected scenarios. Some of these were discussed by the US-based Industry Advisory Council this September during a webcast meeting. The final list of scenarios has not been chosen yet but there are some intriguing possibilities, such as oil prices reaching $100 a barrel, the spread of stricter environmental laws, and the prospect of radio frequency identification technology becoming ubiquitous by 2020.