SCDigest Editorial Staff

US and European companies are placing increased emphasis on their supply management organizations, with plans for significant investments in technology in 2008, according to a recent report from AMR Research.

For the coming year, US companies, on average, plan on increasing investment in supply management technology and processes by 13.9%, according to AMR’s Supply Management Spending Report 2008 (see graphic below). In Europe, the figure will be even higher, with planned increases averaging 15.6%.

Source: AMR Research

Where are companies planning to focus their supply management investments? The research showed a wide range of initiatives were being planned, but in the US, improving supplier connectivity (13% of respondents cited as top priority) and the related area of supply chain visibility (11%) were the top focus areas. Supplier diversity management and supplier performance management ranked next, each cited as the top priority by 10% of respondents.

(Sourcing and Procurement Article - Continued Below)

(Sourcing and Procurement Article - Continued)

Where are the Biggest Gaps?

SCDigest Says:

In the US, improving supplier connectivity (13% of respondents cited as top priority) and the related area of supply chain visibility (11%) were the top focus areas What do you say? Send us your comments here

The AMR report also asked companies to rate the perceived importance of a variety of supply management processes and technologies compared to the company’s current capabilities/performance in that area.

While the research showed important gaps between importance and performance in areas like supplier connectivity and visibility, the largest gaps were actually in more basic areas, such as contract management and spend analysis. Services procurement was another area that showed a large gap between importance and performance.

Mixed Data on “Green”

On green supply management initiatives, the data was mixed. For example, “green procurement” initiatives ranked near the bottom of the priority list, cited as the top priority of only 4% of respondents.

On the other hand, 37% of large US companies plan deployment of some type of supporting technology for green procurement in 2008.

What’s your reaction to this supply management data? Do you see companies strongly increasing investment in supply management technology? Let us know your thoughts at the Feedback button below.