Capgemini study shows pieces still missing from supply chain puzzle

If you look at Christmas shopping as a business project, one thing in particular is certain: There is a hard deadline. If the goods aren't in hand by the end of business on Dec. 24, you can mark it as a failure.

For the last couple of decades, retailers have worked hard to hone their supply chains to try to ensure their customers can meet that deadline. But a new study by Capgemini reveals what most observers already understand: Many retailers still struggle to meet peak time demands, and that means lost sales not only immediately but in the future.

According to the survey by Capgemini, a major provider of consulting, technology, and outsourcing services, 83 percent of U.S. supply chain managers admit it is challenging to plan supply chain capacity to address peak requirements or fluctuations in demand. A mere 21 percent of the surveyed managers say their systems do an excellent job of providing accurate real-time insights into supply chain performance.

The "Supply Chain Impact" study was based on the results of an online survey of 1,000 consumers and 150 senior supply chain managers at retail, consumer products, and distribution companies with at least $1 billion in revenue. The survey, which was conducted for Capgemini by KRC Research, revealed:

• 89 percent of U.S. consumers say they are likely to shop with another retailer in the future if an item is delivered late;
• 73 percent would purchase from a different store than originally intended if they were unable to find an item they wanted in stock, and 29 percent would decide not to purchase the item at all; and
• 54 percent of the supply chain managers admit supply chain issues have had a negative impact on their company's revenue or profitability over the past few years.

The challenges to running a seamless supply chain that are cited by the surveyed managers say will come as no surprise. Some 86 percent of respondents said that having the right processes in place to respond to volatile demand was among their top challenges. And the vast majority lament the difficulty of finding and retaining employees with the right analytical skills or functional knowledge needed.