SCM in a time of downturn
Inducing the customers to part with their money would be the first part of the course of action. This could be via any number of variants of the currently much-maligned “enjoy now, pay later” model or something more innovative – what about pay-per-use for a finished good – akin to the rental businesses, even for B2B? At the supplier side, there may be greater focus on contract management - terms & conditions would get rewritten, supplier rationalization could trigger a wave of consolidation across commodity or geographic lines and contract compliance projects could get a second look. However, in these times, I feel that more than the sell-side and the buy-side supply chains, there would be renewed focus on the delivery vehicle as well. Of late, we’ve seen a spurt in requests on viewpoints around WMS consolidation (my colleagues Sat, Girish & I had written a paper also on this available in the white paper section http://www.infosys.com/supply-chain/white-papers/WMS-consolidation.pdf ), Multi-channel commerce initiatives, transportation optimization, inventory sync and so on.
The reason that here at Infosys we haven’t see a whole lot of slowdown in SCM domain could be that SCM is core to the business and hence is not considered a cost centre – not anymore anyway. Even functions like procurement, in lean times like this, can look at self-funded projects which should be able to feedback savings from quick hit initiatives back into more significant ones. The tie-in to a business case would become a whole lot more rigid, but SCM would be swinging ahead anyway, even in times like these.
