Supply Chain Disruption a Top Fear Among Retail and CPG Executives
Recent research underscores the mounting concerns of retail and consumer packaged goods (CPG) executives, with supply chain disruption ranking among their foremost fears. The study, a collaboration between professional services firm Genpact and research organization HFS, exposes the industry's struggle to keep pace with supply challenges, revealing that a mere 22% believe they have successfully modernized order-management operations.
As the retail and CPG landscape continues to evolve rapidly, the research highlights a pressing need for organizations to transform their supply chain processes and operations to meet the ever-evolving needs of consumers. Among the critical challenges that executives grapple with, the study reveals that the enduring supply chain disruption triggered by the pandemic remains a significant hurdle, impacting 70% of retail and CPG executives. This concern is accompanied by apprehensions surrounding inflation and cybersecurity, underscoring the multifaceted nature of the challenges faced.
A study by Boston Consulting Group (BCG) provides further insights into the preparedness of companies to address supply chain disruptions. Of the 150 companies surveyed, a mere 10% demonstrated true readiness to anticipate and recover from crises in the short term, while also maintaining resilience in the middle- and long-term. In contrast, the majority of companies—90%—are engaged in reactive measures, responding to crises as they unfold.
The study suggests that a strategic investment in resilience-enhancing capabilities is paramount for companies seeking a competitive edge in the current landscape. By significantly bolstering their capabilities, organizations can create a potent source of competitive advantage, potentially mitigating the adverse effects of supply chain disruptions.
Among the risks that companies must consider include disruptions within their own manufacturing plants, interruptions in supply from vendors, and external risks such as geopolitical events and natural disasters. To navigate these tumultuous times, manufacturing companies have a range of optimization strategies at their disposal.
With the evolving market, companies are investing more in technology and software. The management of these models requires different controls and governance mechanisms compared to traditional systems. Investing in technology, while initially expensive, can prove to be cost-effective in the long run, potentially outweighing the need for additional staffing. Automation and technology adoption, including AI-powered solutions, can enhance efficiency and drive further commercial growth in the manufacturing sector.
In a landscape marked by uncertainty, the strategic implementation of technology and resilient supply chain processes emerges as a critical factor for companies aiming to not only navigate disruption but also seize competitive advantages in an ever-evolving marketplace.