Herculean Effort

A new study from the firm that first used the phrase “supply chain management,” Booz Allen Hamilton, suggests that the discipline is still far from mature. Titled “Supply Chain Management at 21,” the study results show that companies where SCM is part of corporate strategy can nearly double savings in the broadly defined area of “cost to serve customers.” In spite of these encouraging statistics, the study also suggests that SCM as a concept has consistently under-delivered. Although various technologies from ERP to RFID have been hailed in the past few years as the key to implementing successful supply chain management, 45% of the 196 survey respondents say that such IT solutions have failed to perform as hoped. The study results indicate that frequently “there is simply too much data overwhelming and confusing the decision-making process.”

Responses show that companies making a “significant” or “Herculean” effort to improve supply chain performance yielded purchasing savings 26% greater than those whose level of commitment was merely “incremental” or “aspirational.” For more information, visit www.boozallen.com.