Enterprises Increasing Technology Spending to Drive Supply Chain Innovation

Aberdeen: While cost control is still a strong desire, 72% of companies have other motivations for supply chain innovation that rank higher.

With globalization of supply and more customer-specific fulfillment mandates, the need for supply chain technology is accelerating. In analyzing the plans of 208 enterprises, Aberdeen finds that supply chain executives are seeking new capabilities and technology features for their next-generation supply chain solutions.

Companies are not only strategizing on what their technology footprints should look like but are also making investments. Fully 48% of all companies and 53% of mid-size firms will spend more in 2006 on new supply chain technology than they did in 2005, while only 8% will spend less. Additionally, two-thirds of large enterprises plan to spend over $300,000, and 35% plan to spend over $1 million.

• Strivers: Companies striving to reach industry average with their supply chain technology roadmap.

• Best Practice Seekers: Companies seeking to adopt industry best practices and supporting technology.

• Innovators: Companies looking to create brand new supply chain innovations.

Supply chain organizations are under intense pressure to meet demands for greater customer intimacy, lower cost of goods sold, and increased global business processesn. To succeed, these organizations are identifying that they need to change their supply chain technology footprints.

While 28% of respondents say lowering supply chain costs is their top motivator for supply chain innovation, 72% point to other motivations, such as the desire to meet customer mandates more efficiently, minimizing demand/supply imbalances, and creating profitable sales growth. The Supply Chain Innovator’s Technology Footprint Report

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