Supply chains are alive with innovation, and a majority of it is not first and foremost about containing costs.
Considering the history of the function, that’s something of a profound statement — and one that might have drawn incredulous reactions just a few years ago. But it’s not imaginary. Every expert we spoke with for the lead article in this package made the point in one way or another.
One of the external contributors of articles for this report (see links below) focuses on the theme as well. But rather than a late-breaking trend, it’s always been true during her long career, she writes, that the biggest strides in supply chain management have come when cutting costs was not the primary goal.
Another contributor, pointing out that companies are coming up thin in their efforts to squeeze out new cost savings every year, suggests a new strategy — the “zero-based supply chain” — for turning the savings faucet back on.
But instead of chipping away at small incremental savings, many companies are going to the other extreme, using their supply chains as key drivers in the development of entirely new business models. For example, letting customers design their own products and then shipping the products directly to them, as some leading-edge manufacturers are starting to do, is a far cry from shipping big palettes of products to stores to be centrally distributed.
As one of the experts we interviewed told us, as a tool for advancing cutting-edge business strategies, the supply chain is where it’s at. What are your views on the subject?