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High-tech supply chains become more customer-oriented

Posted: 11 Mar 2014 ?? ?Print Version ?Bookmark and Share

Keywords:high-tech? supply chain? customer service?

A UPS survey asked high-tech supply chains about customer service and how this relates to their supply chain principle, revealing that customer service is indeed an increasing priority but under cost and product quality considerations.

While it's not surprising that high-tech companies are focused on customer serviceespecially given today's consumer-driven and highly connected worldwhat is interesting is the degree of importance now placed on the customer experience in the high-tech supply chain.

This is our second post in a series based on our annual 2013 UPS Change in the (Supply) Chain survey findings. The topic of this post: the shift in high-tech supply chains to prioritise customer service.

As a refresher, in the last post introducing the survey findings, we ended by asking the following questions: What role does customer service play in your supply chain decisions today? Is it a top priority? Do other factors outweigh it? The verdict: It is a growing priority, but is still being balanced by focusing on cost and product quality, similar to what our survey found this year.

According to the 2013 UPS Change in the (Supply) Chain survey, 39 per cent of those surveyed consider customer service as a top supply chain principle today, which is up from 37 per cent in 2011, and increases to 44 per cent when asked about 2015. Of course, product quality and cost are still important priorities in 2015, at 39 per cent and 17 per cent, respectively, but decision-makers are gradually shifting towards customer-centricity as the number one supply chain principle.

We took a deeper dive to understand this shift better and asked executives what their motivations were for making customer service a top supply chain priority. Of those surveyed, 72 per cent said that more intense global competition and the need to differentiate themselves through customer service was a top driver, while 69 per cent highlighted an increased focus on customers and belief that better service drives improved sales and profits. Finally, 53 per cent cited the growing influence of the end consumer. Based on our own experiences with customers in the industry, we anticipate that these drivers will only continue to increase as more products come to market and demand grows from new, emerging markets.

We also asked about specific changes that high-tech decision makers plan to make to their supply chains. Globally, of those surveyed, 71 per cent said they planned to reduce lead times, a possible indication that these decision-makers are taking advantage of near-shoring opportunities. Another 71 per cent said they plan to improve their planning capabilities. Executives want to improve their fulfilment and post-sales capabilities at 68 per cent and 66 per cent, respectively.

Is your supply chain ready to deliver in a more customer-centric industry landscape? We recommend a supply chain analysis to see where you stand based on your own current and future supply chain principles.

- Ken Rankin
??EBN/Director of Marketing, High-Tech Segment

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