Supply chain management is becoming more established in Dutch business life. Especially on internal cooperation, companies score better. However, the development on the side of external cooperation lags behind, according to the National Supply Chain Monitor (NSCM). Meanwhile, the corona crisis shows that external cooperation actually offers many opportunities.
BLMC and Nyenrode Business University measure every two years the degree of application (maturity) of supply chain management in Dutch business. The most recent results show that companies are scoring higher on average: an average of 3.0 on a five-point scale. In 2017, that score was a 2.8. The differences between companies are decreasing and there are significantly fewer laggards. In 2017, 33 per cent of organisations scored 'weak', in 2019 it is only 18 per cent.
SCM now at professional level
Barring a small dip in 2017, SCM maturity has been increasing for six years in a row, BLMC states. That the largest group of companies has now definitely advanced to level 3 means that SCM has reached a 'professional' level; company-wide thinking and acting has become a fully-fledged part of organisations' strategy.
This breakthrough is mainly due to internal supply chain maturity. With 3.2, companies score especially high on the themes specifically related to this; strategy, culture, leadership and internal cooperation. The most positive aspect is organisational culture with an average score of 3.5. BLMC's Michel van Buren: "That high score is a very positive sign. The typical Dutch culture of cooperation without too much hierarchical control is a strong driver of supply chain management. Because without leadership and culture, you can work out processes and buy systems all you want, but supply chain management is not going to work."
Lower score on external cooperation
At the same time, there is also a lot to do. The number of frontrunners is growing only moderately and the development on the side of external cooperation lags behind. On themes belonging to external maturity (cooperation with customers, suppliers and end-to-end), organisations score an average of 2.6.
High-mature supply chain organisations can be expected to collect and share data with supply chain partners. Prof Dr Jack van der Veen of Nyenrode Business University: "After all, with better data management you can ensure that you serve your customers faster, better, cheaper, more flexible and more customer-friendly." However, the survey shows that the majority of companies still score low on this very aspect. Projects and pilots are being launched in the field of product development and innovation, but companies in the chain still exchange little ongoing digital data among themselves on demand forecasting, for instance. If the systems for this are already in place, they are not fully utilised. In line with this, risk management is hardly applied structurally and chain-wide. Van der Veen: "One explanation may lie in the growing economy of recent years, as a result of which the need for change was not felt as much. Companies used their time and capital mainly for day-to-day operations. As a result, processes have become more efficient and effective internally, but not enough attention has been paid to this externally."
Corona crisis gives companies common goal
The corona crisis may offer opportunities for further supply chain development, argue BLMC and Nyenrode. "External chain cooperation will only get off the ground properly if companies have a clear common goal, other than just a financial goal, in addition to the existing preconditions that are now being met internally. For example, CO2 reduction or reducing plastic packaging in the chain. The current situation suddenly does give many companies that common goal," explains Michel van Buren. "They are now intrinsically motivated to tackle the problems together and keep their companies running successfully. If they manage to couple this with a clear vision and strong leadership from top management, organisations will also achieve higher marks on external chain cooperation in two years' time."
Van der Veen adds: "To get to the next level, you need a switch in thinking: from short-term financially driven goals to long-term goals that are more socially driven, such as sustainability, for example. The exciting question now is: does this crisis give people a boost to let go of the short-term focus because they find that other things are more valuable? Or does it drive companies back into a purely financial focus?"
The National Supply Chain Monitor can be downloaded here.
