Businesses seek flexible supply chains amid turbulent times
As many as 50 percent of respondents believe a more flexible supply chain model is necessary to mitigate trade and macro-economic impacts in the near future, according to Bain & Co's latest China Chief Procurement Officer survey.
Nearly half of chief procurement officers intend to seek new strategic suppliers or source from a different region in the next 12 months, suggests the study, which surveyed 100 procurement executives in both multinationals and local firms.
Despite progress in the previous year in procurement functions such as systematic supplier management and cost monitoring, new geopolitical uncertainties have emerged and may become an important driver for change, according to the study.
Raymond Tsang, global partner and Asia head of performance improvement practice at Bain & Co, points out that there's still much room for improvement in terms of risk management and digital transformation roles for procurement professionals.
"As for a truly flexible supply chain, one needs to start from the very beginning of product design to offer tailor-made products," he added.
Companies with more diverse supply chain are more likely to take stronger actions in the next 12 months, such as seek new suppliers or source from a different region.
Over 80 percent of respondents also expect the importance of procurement in innovation and supporting digital transformation will be enhanced in the next two years.
However, less than one fifth of procurement departments surveyed have power over strategic decisions and only 22 percent of procurement staff play strategic roles inside the company.
Around 60 percent of companies in the survey are still in early stage of digital maturity.