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Latest findings from PwC’s Pulse Survey
As shipping bottlenecks and semiconductor shortages put US supply chains through test after test last year, operations leaders are planning multiple moves to make sure they’re not left behind when the next shock hits. They’re investing in technologies that can speed up insights into shifts in consumer preferences and problems with suppliers, and they’re lining up alternatives to break dependencies on sole suppliers, according to recent findings from PwC’s latest Pulse Survey.
Operations leaders are also looking ahead to tackle the demands of a fast-digitizing world. When asked about their top 2021 priorities, 42% cited improving workforce productivity or taking actions that typically involve upskilling and automating manual processes, and 40% cited advancing environmental, social and governance (ESG) strategies like lowering carbon emissions. These leaders are looking for ways to respond to a series of disruptions since the onset of the pandemic and, at the same time, move with markets that require different skill sets and put more premium on sustainable products and practices.
It’s worth noting that actions to take out costs are in the mix but not dominating the supply chain agenda for 2021, whether that means reducing product cost (a top three for 37% of COOs) or costs in administrative layers (cited by 28%). COO priorities for the year show a near-equal balance of meeting the growth agenda, such as faster fulfillment or building supplier flexibility, with meeting cost imperatives.
The overall health of supply chains remains top of mind in the C-suite, and nearly half of the operations leaders (49%) surveyed cite reducing supply chain disruptions as “very important” to their company’s ability to prosper this year. The pandemic has already exposed risks in US supply chains. As a result, improving demand forecasting and deepening integration with suppliers are top pursuits for operations leaders, with over 40% saying to ‘a great extent.’
End-to-end visibility across the supply chain, from suppliers through to customers, is the goal for improved supply chain resiliency. Planned tech investments reflect the shift with operations leaders equally prioritizing investments into enterprise-wide IT systems that leverage cloud technologies and modernizing operational IT to improve productivity.
Over a third are also developing options to protect fulfillment by reducing reliance on sole suppliers that are closer to home and outside of North America ‘to a large extent,’ while 30% are taking actions to cut down on the complexity that can include lowering SKUs to release cash and free up inventory.
With the Biden administration conducting reviews into supply chain vulnerabilities, potential trade policy shifts and heightened enforcement will come in view for US industry. Companies should be (if they are not already) looking at this confluence of policy areas when considering supply chain solutions that will shore up vulnerabilities brought about by pandemics, climate change and geopolitical pressures.
93 operations leaders from Fortune 1000 and private companies, along with other C-suite executives, weighed in on 2021 business priorities in our latest PwC US Pulse Survey, fielded March 8 to March 12, 2021. Find all of these insights in our PwC US Pulse Survey.
Vaccine rollouts are bringing the end of the pandemic economy into view just as the Biden administration is looking to implement its agenda — fast. Is your company keeping up? Hear the results of our latest PwC Pulse Survey and learn what business leaders are saying about their growth prospects and investment priorities for 2021.