WEF: Strategies for rewiring global value chains

Manufacturers face a spectrum of challenges within global value chains, from the climate crisis to geopolitical complexities and advancements in next-generation technologies. Consequently, they must determine the optimal strategies for reconfiguring their supply chains to ensure the longevity and resilience of their operations moving forward.

A new WEF/Kearney report presents strategies for global value chains. Global value chains face challenges ranging from climate crises to geopolitical headwinds and next-generation technologies. Manufacturers must decide how best to reconfigure their supply chains to safeguard their operations well into the future.

Manufacturers shift from:

  • Global to globally-connected, multi-local value chains.
  • “Doing” digital to “being” digital across end-to-end operations.
  • Economies of scale to economies of skill.
  • Regulatory compliance to innovative sustainability.
  • Being cost-driven to being customer value-driven.

The survey findings reveal a disparity between strategic aspirations and practical execution, primarily attributed to the magnitude and intricacy of the required transformations and the associated opportunity costs in terms of time, effort, and resources. In addition, the compounding geopolitical, climatic, and technological hurdles emphasize how an approach reliant on incremental adjustments will prove inadequate in maintaining competitiveness in the forthcoming years.

Source: WEF/Kearney report

The allure of simplifying and reducing the scope of global value chains may be strong. However, the undeniable truth is that these value chains are consistently exposed to societal, environmental, and geopolitical shifts. Therefore, manufacturers must carefully assess how their value chains can flourish while acknowledging their role in an intricately balanced ecosystem vulnerable to external disturbances.

Instead of dismantling complexity from their value chains, manufacturers can harness their networks’ expansive reach and interconnectivity by adopting innovative, comprehensive, and data-driven approaches. These methods aim to enhance efficiency while promoting sustainability, resilience, and agility.

Deeper engagement between the public and private sectors will enable value chains of the future to flourish.

Source: WEF/Kearney

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Walther Ploos van Amstel  

Passie in logistiek & supply chain management