Trends to Watch

The years of 2001 and 2002, and the first half of 2003 has seen one of the worse economic recessions that the world has ever seen for over 50 years. With the US and EU economic slow down, coupled with the more than decade long recession in Japan, the war in Iraq, and SARS, it would seem that the only bright light today comes from China. China is fast becoming the shop floor of the world, with much of the world’s manufacturing relocating to its cheap land and labour. With China and India powering the growth in Asia, 2004, 2005 and 2006 are becoming a bit brighter. Nevertheless, what the economic situation brings about is an intense downward pressure on business costs and as a direct consequence, supply chain costs.

This signals that the battle of the future facing most businesses is in the area of Supply Chain Management (SCM), and in particular, Supply Chain Execution (SCE). Enterprises are now actively pursuing outsourcing as a means of survival, focusing instead on their core competencies. Collaboration among enterprises in a supply chain eco-system over international boundaries has now become the order of the day. Over the next few blog posts, I shall describe the fundamentals of supply chain management.