Smith & Associates conducts an annual survey of the global supply chain during the December-January period in order to gauge the changes in the industry from a general perspective as well as detailed drill-down views based on the major industry sectors and representing different positions along the supply chain by company and job function. The results from our annual Global Supply Chain Survey report, A 360 Degree View of the Supply Chain, are now available on Smithweb for download and review, and the 2013 report is still available for download.
Given the fast-pace nature of the semiconductor and electronics industry, challenges and trends change rapidly and so Smith has been collecting data from industry sectors that include consumer electronics, medical, energy, and industrial equipment manufacturers. Additionally, where one is positioned in the global supply chain can have a significant effect on how you view what is happening in our industry, so we are careful to ensure that our respondents represent Distributors, Electronics Manufacturing Services (EMS), Original Equipment Manufacturers (OEMs), Original Design Manufacturers (ODMs), and Contract Manufacturers (CMs).
2014 supply chain insights
This year's advanced survey report provides unique perspectives and insight on the global supply chain for the semiconductor and electronics industry. The insights range from individual component demand trends and forecasts to relationships between macro-economic events and supply chain strategies with the added visibility into how these perspectives and strategies differ across company types affecting the evaluation of issues and demand. The major topics covered include:
- Key challenges and concerns for the global supply chain:
- Demand changes are significantly rated as the most challenging issue across all company types followed by inventory management, and margin pressures and cost-efficiencies.
- Economic changes and uncertainty dropped in ranking as key challenges from last year, as did supplier consolidations.
- The role of Independent Distributors
- IDs are sought to provide strategic services by all types of companies to offset demand change challenges providing inventory management and component sourcing solutions when forecasts are missed and when time frames shorten.
- EMS & ODM providers and OEM significantly value ID services for supplying components at the lowest cost alongside of actively filtering counterfeit parts from the supply chain and notifying authorities of threats.
- In descending order, CM, OEM, Distributors, followed by EMS & ODM providers highly ranked ID services for supplying components and providing inventory management.
- Sustainability and climate disruptions
- Respondents are clearly concerned about the threat of climate induced disruptions on the global supply chain, and especially as having a direct impact on their business; however there are notable differences across company types.
- CM are the only company category to view the likelihood of climate induced natural disruptions as an extremely likely scenario, however all respondents view this as a generally likely event.
- Respondents rate corporate sustainability activities as "Important" to "Very Important".
- Forecast: Technologies and component views
- Mobile technologies, Cloud, Internet of Things (IoT), followed by the lower ranked issues of New User Interfaces, Big Data, and Social Media are respectively rated as likely to influence the global supply chain in 2014.
- Combining all respondents across all company types, only three component categories were ranked as having been in "Most Demand" in 2013: Power ICs, Passive Components, and Active Components.
- Forecasting 2014 demand, the response data do not highlight any single category as being ranked in "Most Demand".
- Memory rated highest in general demand for 2014 demand followed by a flip in the ranking of Embedded ICs and Processors; the drop in rating of Processors from 2013 to the forecasted 2014 is a significant downgrade.
- Is the change in rating of component demand in 2014 related to an overall industry or macro-economic outlook dampening or if it is simply a more cautious evaluation; see the report for more data.
- Counterfeit exposure and mitigation strategies
- The data show no single industry sector identified as being "Most Vulnerable" to counterfeiting events. Industry sectors generally rated as "Neutral" for vulnerability, except for Industrial Electronics & Equipment and for Consumer Electronics.
- Distributors consistently rate industry sectors as more vulnerable than do all other company types.
- Survey respondents significantly rate Part Authenticity Testing and Standardized Certification & Accreditation Requirements as important tools for effectiveness in anti-counterfeiting.
Smith recognizes the importance and value in understanding and providing customized solutions for customers' unique challenges and concerns. In addition to providing our customers with the insight to support strategic inventory and purchasing decisions, our annual survey helps us to ensure that our services remain on track to deliver exceptional value and security in the volatile global market. Download the full report with all of the data and analysis free of charge: A 360 Degree View of the Supply Chain.