SA needs clearly defined future-readiness strategies
In its 13th annual supplychainforesight programme, Barloworld Logistics, in partnership with Frost & Sullivan, aimed to find out how South African companies are gearing up for an uncertain future – and to pinpoint some clear strategies to prepare for the years ahead.
Large companies turning over in excess of R1 to R5 billion a year made up 48 percent of the sample, with the remaining 52 percent coming from respondents in small medium and micro enterprises (SMMEs).
Supply chain takes centre stage
It is now very apparent that the concept of supply chain management has taken centre stage and is seen as an integral element in any organisation’s business plans and strategies.
“Likewise, the planning of logistics is now being seen as needing a holistic approach, supported by the physical implementation of operational functions that move the goods, information and funds up and down pre-determined supply chains,” says Kate Stubbs, head of marketing, Barloworld Logistics.
External factors weighing heavy
While respondents have emerged better equipped from the lessons of their past, they express deep concern about the current factors that remain outside of their influence – such as world economics and localised political and social uncertainties. This has resulted in more of a short-term focus of sustainability and a less optimistic view on driving forward-looking strategies.
Skills shortages remain a major constraint for business success in the long term.
The cost versus value equation
Current key focus areas among businesses are managing rising operating costs, pursuing customer-related strategies and addressing ongoing technological developments. Operating costs are still seen as one of the biggest constraints of a business.
“We believe it is perhaps more prudent to understand the relationship of costs relative to the value they derive,” explains Stubbs. “There are many examples of increased costs generating higher returns and greater value.”
Expansion into new markets
The key opportunity expressed by respondents is to seek growth opportunities outside of the country, particularly in regional and neighbouring territories. This year, 69 percent of respondents said they have plans to enter into new markets.
Readiness for Future Opportunities
Only 35 percent of respondents indicated they were ready to meet future opportunities. Two key areas of focus required to prepare for the future included customer focus and skills development.
“This highlights the uncertainty pervading today’s environment,” notes Stubbs. “It also raises a question about the confidence we have about the skills and proven ability to implement, manage and successfully bring to fruition the necessary changes identified in the opportunities ahead.”