The world is changing, and the electronics supply chain must evolve along with it.
High-tech globalization, increased competition, and the ever-increasing influence of end customers all require electronics firms to think in new ways about innovating and getting products into customers' hands customers quicker. The fourth annual UPS Change in the (Supply) Chain survey, which was released today, traces these realities.
The survey, conducted by IDC Manufacturing Insights, gathered input from nearly 350 executives in North America, Latin America, Europe, and Asia about how the supply chain is evolving. Some of the highlights:
- Nearshoring is on the rise.
- A customer-centric supply chain may be the secret to success.
- Organizations need to focus on the entire life of the product, from its global launch to its retirement.
- Emerging markets provide promising opportunity but need careful handling.
These are the trends that are likely to change the face of the supply chain. And the changes are happening quickly. For example, 27% of high-tech logistics decision makers report that their organization plans to embrace nearshoring, versus 10% three years ago. “OEMs are significantly more interested in nearshoring today than three years ago,” Simon Ellis, practice director at IDC Manufacturing Insights, told us. “We can infer the reality that interest is on the rise, and companies are thinking in a different way about how they source their products.”
Ken Rankin, director of high-tech segment marketing at UPS, told us the siren song of nearshoring has been improving service levels and control over intellectual property and product quality. “For those that aren't nearshoring, there are clear cost benefits to low-cost manufacturing countries, and that remains important to them.”
On the other end of the supply chain, electronics OEMs are working hard to differentiate their products by becoming more customer centric. “What bubbled to the top is that companies are facing more intense global competition and so are looking for a way to differentiate themselves,” Rankin said. In fact, 39% of the survey respondents said their supply chain is built to be primarily customer centric today, and that figure will grow to 44% in the next two years. Favorite customer-centric activities include reducing lead times, improving planning and fulfillment, and enhancing post-sales/returns capabilities, the survey found.
We've invited Rankin and Ellis to be our guests at a live chat to delve deeper into all areas of the Change in the (Supply) Chain survey. We'll talk how the supply chain differs from one part of the world to another, as well as from product inception to EOL. A summary of the research can be found here. Take a look, and come armed with questions. We'll have the experts available to tell you what you want to know.
We'll be gathering on Thursday, Nov. 21, at 2:00 p.m. EST/11:00 a.m. PST in the EBN live chat area. We hope to see you there.