Enterprises Seen Increasing Technology Spending to Drive Supply Chain Innovation

Boston, MA — June 4, 2007 — With increasing globalization of supply and more customer-specific fulfillment mandates, the need for supply chain technology is accelerating year over year, according to a recent report from Aberdeen Group.

In analyzing the plans of 210 enterprises in early 2007, Aberdeen found that supply chain executives are actively seeking technology areas for getting immediate return on investment, the analyst firm reports in "The Supply Chain Innovator's Technology Footprint 2007."

In fact, the researchers found that five times as many companies are planning to spend more on supply chain technology in 2007 as were planning to spend less on such technology.

In the report, Aberdeen divides companies into one of three categories based on their supply chain ambitions and how they will be investing in supply chain technology:

  • Strivers: Companies striving to reach industry average with their supply chain technology roadmap.

  • Best Practice Seekers: Companies seeking to adopt industry best practices and supporting technology.

  • Innovators: Companies looking to create brand new supply chain innovations.

  • Inventory management is the top priority for companies in 2007, while in 2006 inventory management was tied with sales and operations planning (S&OP)/demand management.

  • Supply chain visibility is the number two priority for companies in 2007 (very close behind inventory management).

  • Service oriented architecture (SOA) and radio frequency identification (RFID) in warehouse are not high priorities for 2007.

  • Supply chain visibility and transportation management are the top areas of intention to adopt on-demand applications.

  • Top areas where companies are embarking on short-term ROI projects in 2007 are inventory optimization (42 percent), transportation management/fleet management (39 percent) and supply chain visibility (38 percent).