IBM Institute for Business Value - GS1 · 2015-05-28 · IBM Institute for Business Value Sharpen visibility and insight Many CxOs, CSCOs included, think their supply chain is effective

IBM Institute for Business Value


Agenda

CSCO demographics

Assembling the pieces

Orchestrating the customer-activated

supply chain–Sharpen visibility and insight

–Partner for innovation

–Become customer-activated

The future state of supply chain


40Japan

25Asia Pacific

7Middle East and Africa

32South America

Central and Eastern Europe

12Western Europe

50North America

35

This installment focuses on the responses

of 201 CSCOs in 32 countries


5%

34%

9%

34%

13%

Public sector

Industrial sector

Financial Services sector

Distribution sector

Communications sector

201interviews

Our CSCO respondents represent a wide range

of public and private sector organizations,

covering more than 16 industries



Agenda

CSCO demographics








Sharpen visibility and insight

Partner for innovation

Become customer-activated

Integration and visibility

Synchronize entire supply chain

Optimize every element for rapid market response

Business intelligence

Adopt advanced analytics and modeling tools

Use real-time data to predict demand

Collaborative execution

Increase level of partnership

Use collaborative digital strategies

Innovative initiatives

Treat risk mitigation as integral part of the CSCO’s job

Create agile and social networks

Customer influence

Collaborate more actively with customers

Incorporate customer input in product/service portfolio

Customer experience

Understand the customer

Shift oversight to the customer experience

Assembling the pieces of a customer-activated supply

chain involves activities on three dimensions



Agenda

CSCO demographics









Many CxOs, CSCOs included, think their supply chain is

effective and efficient–a strategic asset both for delivering

on the customer promise and for fueling growth

CSCOs are working hard to integrate their entire supply

chain ecosystems and sharpen visibility

Future state: managing the supply chain complexity

requires superb business intelligence and insights


CSCOs and CEOs agree on the effectiveness of their supply chain

Many CxOs see the supply chain as effective and efficient

–strategic for delivering on customer promise and fueling growth

33%

Client satisfaction

Operational efficiency and effectiveness

Revenue growth

Product/service development

CEO CFO CHRO CIO CMO

35%

43%

40% 47% 40% 43%

35% 44% 39% 41%

35% 30% 28% 30% 31%

CSCO

47% 47% 50% 51% 51%53%

48%

42%

47%



CSCOs are working

hard to integrate their

entire supply chain

ecosystems and

sharpen visibility

Effective integration and visibility across the supply chain

74%2–5 Years

22%Today


The challenge is how to integrate the whole supply process end-to-end with more visibility.CSCO

Consumer Products, Argentina

“”


Most CSCOs are still struggling to optimize their supply chain flows

Optimization across the global supply chain is seen as a major

goal, but most CSCOs are struggling to create a holistic view

In 2010, 70 percent of CSCOs

predicted that their supply chain

flows would be optimized within

five years.

Today, only 9% say they have

succeeded, but expectations

are even higher than before.

9% 80%

12% 70%

2014

2010

Level of optimization today

Expected level of optimization in 2–5 Years

Supply chain flows

1. Product 2. Information 3. Decision 4. Work 5. Financial


Combining real-time information with predictive demand

Most CSCOs haven’t yet mastered the ability to predict

demand by combining real-time data

In 2010 it was expected that

predictive demand would be

implemented in the next

5 years (69%), but today only

16% already have.

2014

2010

17% 69%

16% 75%

Level of predictive analysis today

Level of predictive analysis in 2–5 years



The greatest challenge in the next three-to-five years will be embracing technology to enhance visibility across the entire supply chain to allow for real-time decision making.CSCO

Industrial Products, Singapore

“”


CSCOs expect to use advanced analytics and

modeling much more extensively in the future

Modeling to optimize all flows

Advanced analytics to inform decisions

Future state of supply chain

16% 92%

9% 80%

Level of implementation today Level of implementation in 2–5 years



Synchronize, synchronize, synchronize.

Make your supply chain tightly integrated and more

visible to respond to variable market conditions.

Create a single view of supply and demand,

centralize planning, share documents electronically

and streamline your processes.

Taking action: Sharpen visibility and insight


Optimize your flows.

Combine advanced analytics with modeling tools to

optimize your product, information, decision, work

and financial flows. Evaluate the trade-offs between

costs and service levels. Utilize resources, including

capital, personnel, equipment, vehicles and

facilities, more efficiently. Assign the best resources

to each task–at the best possible time.



Create a forward vision.

Use real-time market and customer-related data to

predict and manage shifts in demand. Monitor the

social sphere to identify what’s hot and what’s not.

When interest in a particular product or service

suddenly surges, demand often surges as well.



Agenda

CSCO demographics








Partner for Innovation

CSCOs have substantially increased the degree to which

they plan and execute in collaboration with their partners

Managing risk is now an integral part of the CSCO’s job,

requiring a balanced partner strategy

Future state: information and insights will be shared

on a large scale with supply chain partners to

encourage innovation


CSCOs have substantially increased the degree to which

they plan and execute in collaboration with their partners

2010

2014

Collaborative planning and execution with partners

47% 96%

27% 89%

Level of collaboration today Level of collaboration in 2–5 years


As we fuse the physical network with the digital network, we must rely upon collaborative teamwork with partners for rapid consumer responses.CSCO

Retail, United States

“”




Managing risk is now an integral part of the CSCO’s job,

requiring a balanced partner strategy

2010

2014

CSCOs plan to focus more on integrating security and process controls to manage risk…

51% 92%

23% 74%

Level of implementation today Level of implementation in 2–5 years

…and to get compliance strategies and practices in place with external partners

2010

2014

62% 97%

37% 79%



Connect the dots.

Collaborate more extensively with your value chain

partners, including suppliers, service providers,

contract manufacturers, carriers and customers.

Focus, collectively, on optimizing your operational

and financial performance.

Taking action: Partner for innovation


Get a handle on risk.

Treat risk management as an integral part of your

job. Incorporate risk-management policies and

programs with increased process controls and

compliance strategies. Use modeling to predict

shortfalls in critical supplies, manage disruptions

and reduce or eliminate out-of-stocks.



Pool brains.

Share information and insights with your

supply chain partners to encourage innovation.

Incentivize everyone in the ecosystem to share

skills, experiences and networks. Reward anyone

who comes up with a good new idea.



Agenda

CSCO demographics









Most CSCOs plan to collaborate much more extensively

with their customers, recognizing the influence the

customer has on their product and service portfolios and

even their product pricing strategies

They know they can only improve the customer experience

if they get a clearer understanding of the customers

Future state: CSCOs plan to become more personally

involved in improving their company’s eCommerce

operations, managing the customer experience and

pursuing new business opportunities





84%

75%

71%

Customer influence on product and service portfolio

Create new products and services

Alter pricing strategy

Change existing products and services

CSCOs anticipate making numerous changes to

their portfolios to reflect what customers desire


Our goal is to provide complete transparency, while individualizing the customer experience.

CSCO

Transportation, United States

“”


Our aim is simplification of business processes, with the focus on improving the delivery of service to our customers.

CSCO

Banking, United Kingdom

“”


But the links between the supply chain and

marketing function are still not pervasive

Large parts of the supply chain are not integrated with marketing

45% 50% 52%

Sales planning

Customersell-throughinformation

Marketingintelligence

Not integrated

with marketing

Integrated

with marketing


Sales and Operations Planning (S&OP) can bridge the gap to

some degree–most CSCOs aim to use actual demand signals

2010

2014

Actual demand signals for collaborative S&OP

34% 87%

19% 70%

Level of implementation today Expected level of implementation

in 2–5 Years


Future state areas of CSCO personal involvement

CSCOs are shifting their priorities to accommodate

changing customer expectations

+8%

+8%

+6%

eCommerce

Customer experience management

Sales and new business development


The supply chain is the execution engine that keeps the promises the rest of the organization makes.

CSCO

Consumer Products, Canada

“”



Invite customers to the table.

Include customers in any conversations about your

product and service portfolio. Ask them what new

products and services they would like to see next,

how they would like existing products and services

modified and what pricing strategies they would

prefer. Use social networks to start a dialog and get

direct input.

Taking action: Become customer-activated


Invest in customer understanding.

Capitalize on the abundance of data that’s now

available to find out what customers expect. Look at

the digital and physical paths they take, where they

go–click by click or step by step, their behavioral

patterns, transaction histories and the feedback

they provide to predict new trends, and manage

your supply chain proactively.



Enhance the customer experience.

Collaborate with customers both to improve and to

personalize the customer experience and thus

stimulate growth. Use real-time demand signals and

dynamic resource allocation to serve individual

customers accurately and effectively. And liaise with

the marketing and sales functions to ensure your

efforts are coordinated.



Agenda

CSCO demographics








62%

56%

54%

54%

75%

CSCOs plan to invest

heavily in supply chain

transformation in the next

three-to-five years,

including visibility and

intelligence

Future investments

Cost reduction/cost containment

Supply chain visibility

Sales and operations planning

Business intelligence/analytics

Inventory optimization










Customer influence

Customer experience

Assembling the pieces of a customer-activated supply

chain involves activities on three dimensions

Outperformers invest 35% more in supply chain visibility

Outperformers invest 100% more in collaborative business intelligence

Outperformers invest 48% more in customer understanding

Future state: Managing supply chain

complexity requires superb business

intelligence and insights

Future state: Innovation will apply

modern technologies to rapid business

model changes

Future state: Personal

involvement in eCommerce and

customer experience management






Synchronize entire supply chain

Optimize every element for rapid market response


Adopt advanced analytics and modeling tools

Use real-time data to predict demand


Increase level of partnership

Use collaborative digital strategies


Treat risk mitigation as integral part of the CSCO’s job

Create agile and social networks

Customer influence

Collaborate more actively with customers

Incorporate customer input in product/service portfolio

Customer experience

Understand the customer

Shift oversight to the customer experience

Where are you on the path to a

customer-activated supply chain?

Outperformers invest 35% more in supply chain visibility

Outperformers invest 100% more in collaborative business intelligence

Outperformers invest 48% more in customer understanding

Future state: Managing supply chain

complexity requires superb business

intelligence and insights

Future state: Innovation will apply

modern technologies to rapid business

model changes

Future state: Personal

involvement in eCommerce and

customer experience management


Sharpen visibility and insight Partner for innovation Become customer-activated

Recommendations

Synchronize, synchronize,

synchronize

Optimize your flows

Create a forward vision

Connect the dots

Get a handle on risk

Pool brains

Invite customers to the table

Invest in customer

understanding

Enhance the customer

experience


We invite you to continue the conversation

For more information about this study and

to get the full version of this report, see

www.ibm.com/csuitestudy

Access interactive content and listen to

CxOs in their own words by downloading

the IBM IBV app for Android or iPad

Connect with us

http://www.ibm.com/csuitestudy

http://www-935.ibm.com/services/us/en/c-suite/csuitestudy2013/index.html

IBM Institute for Business Value - GS1 · 2015-05-28 · IBM Institute for Business Value Sharpen visibility and insight Many CxOs, CSCOs included, think their supply chain is effective

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