Exploring Investment Drivers for Global Supply Chain Risk Management

supply risk

This post is based on content from the case study authored by Spend Matters’ Thomas Kase, A Case Study in Global Supply Chain Risk Management: How AGCO Implemented an SCRM Solution to Save Millions.

AGCO’s story is fascinating – and will provide great business case fodder for manufacturers looking to build the case for investment themselves in such programs.

But what are the business drivers for companies making investments in such programs today? At the core, companies are changing, silos are breaking down and stakeholders are collaborating 
as never before.

As a result, a new concept is emerging: global supply chain risk management (SCRM).
 Quite often, the decisions to invest in SCRM are often driven more by the fear of negative press – and of course regulatory penalties – than the opportunity to make the supply chain more resilient and maintain top-line revenue and market share, even in the case of a supply chain upset.

Some of the drivers that make SCRM solutions particularly attractive include:

  • The move from a slow internal and compliance driven model to one that looks to external and dynamic content
  • Low solution price points – nearly out-of-box availability and software-as-a-service (SaaS) delivery have combined to make the tools accessible to even small- or mid-size businesses
  • Big data – with tens of thousands of data sources incorporated, the underlying content has grown beyond what any individual could manage and analyze
  • Functionality – ease of use has significantly improved, putting visibility and analytics in the hands of decision makers at all levels in organizations. 
To be clear, this is still a new space. The newer, smaller, nimbler solution providers are rapidly innovating and the solutions are quickly evolving. What is in the marketplace today will look quite different only a year from now, making it critical for organizations to jump on board and to start to internalize the progress and new capabilities.

Organizations that want an inside track on building or accelerating a business case for investment in SCRM are likely to find the Spend Matters paper, A Case Study in Global Supply Chain Risk Management: How AGCO Implemented an SCRM Solution to Save Millions, useful in their efforts.

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