This Month in Modern: Recession’s silver lining

In business, as in life, the tougher the challenge you face the smarter you have to work to see your way through to a resolution—and never did the readers of Modern meet a tougher battle than “doing more with less” during the recession.

By ·

In business, as in life, the tougher the challenge you face the smarter you have to work to see your way through to a resolution—and never did the readers of Modern meet a tougher battle than “doing more with less” during the recession.

But according to the latest numbers that our research partners at Gartner dug up on the worldwide market for supply chain management (SCM) software, it appears that many Modern readers have indeed learned some tough lessons and are preparing to be equal to the task, especially when it comes to working smarter by leveraging the enabling benefits of technology.

According to Gartner, the worldwide market for SCM software applications, maintenance and services came in at $5.2 billion in 2011, an extremely impressive 12.1% jump over 2010. In fact, Gartner has projected a compound annual growth rate of SCM software of 8.7%, which should just about double the size of the market over the next 10 years.

So, what’s driving supply chain organizations to finally be more aggressive in SCM software adoption? Gartner’s Chad Eschinger, vice president of supply chain research, tells our Bob Trebilcock this month that the recession era validated six key drivers that will continue to push the adoption of SCM software—and none of them should come as any surprise considering the lean environment Modern readers now find themselves managing within.

I’ll certainly won’t give away too many of the details that Trebilcock unveils starting on page 24, but I will touch on just one of the drivers that illustrate the broader supply chain thinking that is pushing warehouse and DC management professionals to better integrate operations with that of other aligned supply chain functions—and software adoption is proving to be the enabler.

Clearly, the top driver that caused the most acute pain point for many of our readers during the recession was the call to “improve customer service” while your equipment and labor budget were being cut to the bone. According to Eschinger, it will certainly remain the top reason companies will continue to invest in SCM software in the future.

“More with less” is a mantra that stuck, but your internal and external customer demands are now greater than ever.

According to Eschinger, what many supply chain organizations learned once they adopted supply chain planning (SCP), more robust warehouse management systems (WMS), and started to integrate data from transportation management systems (TMS) was that they were able to improve demand planning, orchestrate supply chain activities, and gain an overall visibility that they had never had in the past.

“The floods in Asia and the earthquakes put a spotlight on the complexity in today’s networks,” says Eschinger. And in turn, many users were able to manage the disruptions, be more nimble, shift freight and inventory on a dime and keep costs in line all while meeting customer expectations.

We continue to discover more and more case studies of readers who have used the management pressures of the recession as a springboard to software adoption, and the Gartner numbers certainly validate that fact. And when you think about it, the recession has generated many silver linings; but the fact that we’re working smarter through technology may have the longest-lasting benefit.

About the Author

Michael Levans, Group Editorial Director
Michael Levans is Group Editorial Director of Peerless Media’s Supply Chain Group of publications and websites including Logistics Management, Supply Chain Management Review, Modern Materials Handling, and Material Handling Product News. He’s a 23-year publishing veteran who started out at the Pittsburgh Press as a business reporter and has spent the last 17 years in the business-to-business press. He’s been covering the logistics and supply chain markets for the past seven years. You can reach him at [email protected]

Subscribe to Modern Materials Handling Magazine!

Subscribe today. It's FREE!
Find out what the world’s most innovative companies are doing to improve productivity in their plants and distribution centers.
Start your FREE subscription today!

Latest Whitepaper
The Overlooked Competitive Advantage: Connected Teams
57% of surveyed manufacturers believe they could reduce downtime by 10-30% by unifying their workgroup communications. What does a minute of downtime cost you?
Download Today!
From the January 2018 Modern Materials Handling Issue
PFS built one of the largest and most automated AS/RS freezers in the world in Washington state. Next up is a new design for automation. Automated Storage/ Automated Retrieval System, Cold Storage.
Lift Truck Series Part 1: Lift truck technology connects pickers to productivity
Breaking Through On Yard Visibility
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
Emerging Technologies for Your Distribution Center
Come get an insider's view of the latest technologies for inside your Distribution Center. You'll learn which technologies are being piloted, which are having success and moving from concept to implementation and into production on the maturity scale, and what's coming on the horizon.
Register Today!
Trinchero Family Estates: Pallet handling in the vineyard
The second-largest family-owned wine company in the world turns to automated pallet handling and...
System Report: Rocky Brands Sees the Light
Confronting an aging materials handling system and new channels of business with new customer...

Top 20 industrial lift truck suppliers, 2017
The top lift truck suppliers list is changing with industry acquisitions causing a dramatic...
Lodge Manufacturing: Distribution Cast in Iron
In a new facility, iPhones and a new WMS allowed cookware manufacturer Lodge to double its business...