Maturity Level of European Manufacturer’s Digital Supply Chain Flexibility

By | August 24, 2022

The supply chain is undergoing a series of seismic changes. There are shortages everywhere, and their root causes are varied. In some cases, this is a historic opportunity that cannot keep up with demand growth; In other words, it is a supply disruption due to a lack of workers or shipping containers.

Sustained and sustained operations have re-emerged as critical capabilities for these highly disruptive new/next normal capabilities.

In order to achieve their business goals, manufacturers must not only adapt quickly to disruption, but also be able to take advantage of changing circumstances. They must embrace new business models as opportunities arise.

This requires an agile supply chain that can see and analyze what is happening in real time and then act quickly on the insights that emerge. The results of IDC’s Global Supply Chain 2022 study also show that improving supply chain visibility and agility are two key areas for European organizations to reduce supply chain risks.

IDC Digital Supply Chain Flexibility Maturity Benchmark

The IDC Maturity Scape: Digital Supply Chain Resiliency provides a framework for senior leaders to assess their digital supply chain resilience and determine how to improve business performance in the face of frequent supply chain disruptions.

Below is a graphic representation of the five stages of maturity of supply chain flexibility as defined by IDC – from the simplest, unstructured ad hoc stage to the advanced, systematized and optimized stage.

Source: IDC, 2022

Maturity breakdown of European manufacturers by stage

According to IDC’s 2022 Supply Chain Resiliency MaturityScape Benchmark Survey of 200 European respondents, we found that European manufacturers across all industries are at different stages of their digital supply chain resilience journey.

It affects how products are designed and brought to market, how they plan and execute their supply chain, how products are manufactured and fulfilled, and how they interact with customers and consumers.

Key findings of this benchmark study include:

  • Only 4.1% of supply chains are at the highest level of digital supply chain agility, showing that there is still significant progress and value to be gained by using modern processes and digital technologies.
  • Fewer than one-fifth of all supply chains are in the top 2 stages of maturity and have a competitive advantage, especially in cases of significant disruption.
  • In contrast, nearly half of the responding organizations are in the lowest two stages of maturity, with supply chains that are either competitively neutral or a source of competitive disadvantage.

Supply chain sustainability is a long way to go

Building digital supply chain flexibility is a long-term journey that must be progressed through maturity stages, from the simplest, unstructured ad-hoc stage to the advanced, systematized optimized stage.

This journey represents significant change for many companies and leadership teams, and will vary for different companies based on the sub-industry in which they compete and their previous supply chain transformation efforts.

There seems little question that manufacturers compete in today’s fast-paced, disruptive, information-intensive world with full transparency of both successes and failures.

In this context, old ways of working simply won’t suffice. The past two years have not been easy for the supply chain, and 2022 does not seem poised to reverse this trend.

Having the right vision, leadership and culture is critical to the success of any business, and supply chain sustainability is no exception.

Working in an environment where finding labor and talent is a big challenge means understanding how to better train the people you find and how to effectively use technology to augment mundane or mundane tasks that distract them from value-added tasks.

Sustainability encompasses all of these and evolves from a ‘program’ to a supply chain management approach. Sustainability must be integrated into tactical and operational supply chain processes, with metric reporting that defines performance and drives continuous improvement.

To learn more about this IDC MaturityScape Benchmark, please contact me, Gunjan Bassi, at gbassi@idc.com. You can also read our report IDC MaturityScape Benchmark: Digital Supply Chain Resilience in Europe, 2022 (psubscription required).

Sustainability is also one of the pillars of IDC Insights’ PRIME Framework and is addressed throughout. IDC Manufacturing Summit 2022. Join us to learn more. Registrations are now open.

Leave a Reply

Your email address will not be published.