Reducing Overall Supply Chain Costs is #1 Priority Among Manufacturers, According to IDC Manufacturing Insights 2012 US Supply Chain Survey

Framingham, MA – June 19, 2012 – IDC Manufacturing Insights today announced the results of the 2012 US Supply Chain Survey, which examines the state of the supply chain, how manufacturers are adapting and improving their supply chains, and how technology plays a role in enabling manufacturers to be more successful. Based on a survey of 350 US manufacturers, a new report set to publish at the end of June, “Business Strategy: 2012 Supply Chain Survey-Manufacturing Priorities and New Technology Adoption” found more than despite being product-centric organizations, 80% of respondents rate reducing overall supply chain costs as the number one supply chain priority in the coming year. Nearly 55% suggest supply chain agility is second and 52% suggest improving product quality and safety is the third most important priority. When asked to rate the level of importance of new technology areas, big data/analytics came out on top, followed by mobility, cloud computing/software as a service and social business tools.

While manufacturers face increasing complexity as customer demand diversifies and supply globalizes, supply chain organizations are adapting to respond to requirements such as:

Complex and extended global supply networks

Volatile demand

Growing regulation, particularly in the area of traceability

Pressure to be more agile and increase the clock speed of the supply chain

The "rise" of the savvy consumer

To address these challenges, IDC Manufacturing Insights has found:

Manufacturers continue to increase the amount of low-cost country sourcing. IDC Manufacturing Insights recommends revisiting the profitable proximity sourcing approach and how that concept, supported by IT, can ensure sourcing decisions to create a competitive edge.

Most manufacturers view their supply chains as focused primarily on product quality, yet their supply chain priorities usually start with reducing costs, followed by responding to supply or demand changes, ahead of product quality and customer service.

With IT-based solutions for demand planning and forecasting and production scheduling viewed as key to manufacturers' business performance over the next year, this could signal a genuine shift to a more holistic approach to truly integrated business planning, inclusive of fulfillment excellence.

Big data and mobility are the most important new technologies for manufacturers' supply chains. IDC Manufacturing Insights believes there is substantial value to how manufacturers can use these to improve their agility and customer service.

“According to our findings, the key supply chain challenge facing all manufacturers today is the juxtaposing of complex and extended supply networks with increasingly fast and volatile demand networks – and the increasingly ineffective role for inventory as a way to buffer cadence mismatches,” said Simon Ellis, IDC Manufacturing Insights Practice Director. “While there is anecdotal evidence to suggest that 2012 may indeed represent the most challenging time in the history of the manufacturing supply chain, significant opportunities also abound in terms of the supply chain this year. For example, consumer-facing manufacturers have an opportunity to redefine their core relationship with the consumer through mobile and social media tools; or the ability to apply next-generation analytics to massive new sources of data (both structured and unstructured).”

To learn more about this survey, please join IDC Manufacturing Insights analysts Simon Ellis, Kimberly Knickle, and Catherine White for a complimentary one-hour web conference, “Big Data Leads the Four Pillars – U.S. Supply Chain Survey 2012 Results,” June 28, 2012 – 12:00 p.m., U.S. Eastern time. During this time, the analysts will share their insights into these results and explore a number of pressing questions related to supply trends in the coming year.

For additional information about this report, or to arrange a one-on-one briefing with an IDC Manufacturing Insights analyst, contact Sarah Murray at 781-378-2674 or sarah@attunecommunications.com. For further information, email insights@idc.com. Follow IDC Insights on Twitter: @IDCInsights.

About IDC Manufacturing Insights

IDC Manufacturing Insights assists manufacturing businesses and IT leaders, as well as the suppliers who serve them in making more effective technology decisions by providing accurate, timely, and insightful fact-based research and consulting services. Staffed by senior analysts with decades of industry experience, our global research analyzes and advises on business and technology issues facing asset intensive, brand oriented, technology oriented, and engineering oriented manufacturing industries. International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology market. IDC is a subsidiary of IDG, the world’s leading technology, media, research, and events company. For more information, please visit www.idc-mi.com, email info@idc-mi.com, or call 508-988-7900. Visit the IDC Manufacturing Insights Community at http://idc-insights-community.com/manufacturing.