Barloworld Logistics’ supplychainforesight 2016 report reveals the universal alignment of supply chain strategies with business strategy.

Without doubt, the complex nature and fast pace of business today is forcing many business leaders to rethink their traditional approach and strategies. Notably, the adoption of new technology tools and platforms has become a business imperative. Closely related to the tech-driven transformation is a marked shift towards outsourcing non-core activities, spurred by the need to focus on specialised products and services. Business leaders are realising that in order to achieve long-term growth, they need to serve a niche part of the market – and truly add value to the bottom line.

For the supply chain and logistics industry, these broader shifts are resulting in a very tangible change in attitude toward the business supply chain as a whole. Increasingly, smart companies are recognising that the supply chain can no longer be viewed as a separate function: the management of supply chains should be integral to the core business vision and overall strategy. Indeed, it can no longer be viewed as separate - or belonging to a certain department or team.

This was one of the key insights to come out of the 13th annual Barloworld Logistics supplychainforesight programme, which explored how SA companies have adapted to changing conditions over the past years. As Steve Ford, CEO, Barloworld Logistics, commented: “The rising importance of logistics and supply chain management in achieving business success has been evident in our findings over the last decade.”

Essentially, supply chain management relates to almost any business activity and has, in effect, been a key element in overall business strategy. It entails the management and optimisation of resources and business processes to meet specific business objectives e.g. customer satisfaction, greater efficiency, reduced risks, etc.

“We are encouraged to note that logistics and supply chain management strategies and functions are increasingly being embraced in the services industries, as they begin to recognise the extent of their supply chains and the related logistical processes involved in managing business systems, outsourced partners and the increased flow of information (as well as money between all parties),” explained Ford.

Indeed, respondents to this year’s supplychainforesight survey underscored that the strong focus on a diverse range of supply chain factors is delivering significant value to their companies. As the report noted, ‘universally, the alignment of supply chain strategies with business strategy has become more critical and is delivering very positive results for South African businesses. The integration of customers into the supply chain is recognised as an approach which delivers improved customer centricity, enabling improved performance and satisfaction levels.’

Moreover, the strong focus on collaborative strategies is widespread and most likely adopted to minimise cost and reap the benefits of smart partnerships.

Perception is Key

 Whilst supply chain management is undoubtedly evolving into an integral part of overall business strategy integrated throughout an organsiation, the perception of its importance remains key to competitive advantage, efficiency, effectiveness and sustainability.

The survey highlighted that an underperforming supply chain is seen as having a major impact on overall business performance. Many professionals clearly and increasingly see supply chain as the cornerstone of a successful business strategy.

Despite this, over one-third of the respondents stated their own supply chain is not yet ready to meet their future needs, and a further 45% stated they partially agree with this.

Based on these insights, from a supply chain and logistics perspective, there still remains a lot of work to be done before we see South African businesses gaining the full and real value from their supply chain and business strategies.

 Read more in the latest Supply Chain Foresight report