Manufacturers gain operational efficiency, sacrifice improvements in supply chain visibility: New report

A new report from KPMG found that while global manufacturers are putting their supply chains at the center of their business strategies, a whopping 54 percent of domestic manufacturers admit that their supply chain visibility doesn't go beyond their Tier 1 suppliers (those direct suppliers to OEMs).

The findings are part of New York-based KPMG's 4th annual Global Manufacturing Outlook - Competitive Advantage - Enhancing Supply Chain Networks for Efficiency and Innovation. Survey participants included 335 global executives - 95 of which are in the U.S. Of those respondents, just 9 percent (7 percent domestically) say that they have complete visibility over their supply chains.

Rob Barrett, KPMG's managing director in supply chain and operations sees companies' attempts to streamline their own operations, reengineer core business processes, and work in a leaner fashion, with preventing at least some of the supply chain visibility that companies are now striving to obtain. ERP users, for example, rely heavily on systems like Microsoft Dynamics ERP to manage and/or harmonize organizational processes within their four walls - but not necessarily outside of them.

"A lot of companies are now looking at how to manage all of the data and information that lies outside of those four walls," Barrett points out, "and how to extend their ERP worlds across hundreds or thousands of global trading partners." As part of that quest, Barrett says organizations want the same level of visibility and transparency that they get internally from their ERPs - but across all of the partners that they do business with.

"That's the challenge that firms are addressing right now," Barrett says, noting that ERPs don't traditionally extend outward far enough to meet these new ...