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Ferrari Consulting Group’s 2017 Supply Chain Report – A Challenging Year Ahead for SCM

In the annual “Predictions for Industry and Global Supply Chains” Report, the Ferrari Consulting and Research Group warns of a year of “uncertainty and increased volatility for many industry supply chains.” No supply chain function will be without hurdles, he says, running across ballooning procurement costs, talent shortages and complexities in risk management.

Of particular note, Ferrari for the first time discussed pharmaceutical supply chains in the report. November, 2017 brings a significant compliance deadline, as drug manufacturers will be required from that date onward to serialize products via serial number, lot number and expiration date markings in both machine-readable and human-readable formats. Implementation measures will increase across the next 10 years under the Drug Supply Chain Security Act, so we’re indeed in the early stages of a compounding compliance cycle.

Ferrari also notes continued supply shortages for critical drugs in Pediatrics, Oncology, Gastroenterology and Endocrinology, and this will need to need increased attention despite the industry demonstrating a consistent “lack of common goal collaboration across an extended supply chain with conflicting stakeholder interests.”

It is no wonder pharma rises this year to receive Ferrari’s attention.

Finally, despite aerospace manufacturers largely exceeding their operational performance targets last year, Ferrari sees 2017 as “especially challenging” for the aerospace industry. Factors such as declining order flows for high-margin wide aisle aircraft (and the accompanying pressures to boost production volume of narrower margin single-aisle aircraft), as well as the trend toward more technologically laden aircraft, all contribute to the test.

Our take: Do not ignore the role for distributed asset intelligence in easing these burdens.

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