TOP TEN TRENDS INFLUENCING PROCUREMENT

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• Emerging Solutions For a Global Supply Chain

• Low Cost and Reliable

• New “App” driven user interfaces

• Multi-Dimensional

Number 10

Cloud Computing

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• Technology Merges Inter-Company Commercial Documents

• Extended Supply Chains become Less Extended

• Multi-tier Control Towers in Supply Chains Become the New Normal

Number 9

Business Process Convergence

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• Mexico Matches China in Direct Labor Costs. India, Ukraine and Indonesia Are Most Competitive

• “Made in the USA” Trend Grows but Slowly as Regional Manufacturing Becomes More Cost Effective• Right to Work Legislation • Regionalization• National Interests

• Labor Arbitrage no longer drives Sourcing

• Remote Staffing Augments Higher Costs through Technology

Global Labor Costs Equalize

Number 8

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Africa, Australia, Canada, China & Russia Increase Focus

New Innovations in materials (AC to aluminum)• Gold to Copper• Steel to Resin

Conflict Minerals and Rare Earth Management

Number 7Raw Material Scarcity

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• Undergraduate and MBA Programs Become More Specialized

• New and Required Skills Emerge in:

Supply Chain Cloud

Cost Innovation (Cost Engineering)

Multi-tier Analysis added to Total Landed Costs

Logistics Change to Accommodate Regionalization

BRIC Market Capabilities

Number 6Skill Specialisation

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• Virtual Vertical Integration*

• Mobile and Intelligent Networks

• Logistics Tracking Capabilities

• Risk and Velocity Drive Cost Management

• New Tools for Supply Chain Visibility

• Risk Mitigation Technologies

* Industry Leaders Own No Factories

Number 5Control Tower Models Replace

Traditional Procurement Functions

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Regional Sourcing Expands as economies grow

• Regional Manufacturing pulls back Supplier Ecosystems

In the US and Midwest: A Manufacturing Renaissance

In Europe: Poland, Romania and the Ukraine

In Asia: India and Indonesia grow to compete with China

• And CSER Becomes Normal in today’s Emerging Countries

Number 4

The Growth of Regional and Local Sourcing

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• Risk, Resiliency and Preparedness define winners as conflict, terror and geographic disturbances change business behaviours repeatedly

• Supply Chains Become Three dimensional and More Cost Efficient

• Multi – Tiered Focus and

• Risk Reduction and the Emergence of ETESCRM • VelocityImprovement

Number 3Unpredictability becomes more Predictable

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Country and Company Optionalism Disappears

Policy Penetration Expands Globally

Emerging Country Laws Catch Up

Foreign Corporations Follow Global Norms

Number 2

Corporate Social and Environmental (CSER) become Fundamental

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Changes From:• Relational to Integrated

• Category Management to Multi-Tier Supplier Mgt

• Risk Management linked to Insurance and Investment

And:

• New Tools Drive Trust, Transparency and Reliability

• Supply “Ecosystems” focus on Balance for Success

Number 1“Non-Zero” Approaches to Supplier Management

Evolve SRM

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OLD ST LABSINNOVATING THE ENTERPRISE

WWW.OLDSTLABS.COM

OLD ST LABSINNOVATING THE ENTERPRISE

WWW.OLDSTLABS.COM

This slide deck is put together from Tom Linton’s Presentation at the World Procurement Congress May 2013

Friday, 31 May 13