For 30 years, companies have sought to outsource and offshore IT as a way to reduce costs and/or quickly improve performance. Mega-deals were done in the ’90s and then, after that market was saturated, lesser deals ensued.
While output for small automobiles moves south of the border, dozens of U.S. parts manufacturers are still counting their blessings. Their business is plentiful as they supply goods for the new plants automakers are building in Mexico.
The transportation and logistics vendor landscape is highly fragmented, due largely to the numerous moving parts it takes to get a manufacturer’s product from concept design through production and all the way to the end-user’s hands.
The trucking industry is on a growth trajectory that is predicted to continue at least through 2022, according to the American Trucking Association (ATA). In addition, reduced fuel prices are leading to more flexible, affordable shipping options.
Automation solutions are increasingly incorporating capabilities to handle the Internet of Things, but manufacturers will likely need to shop separately for many best-of-breed IoT components.
Today, nearly every company has a chief procurement officer (CPO) leading a sourcing team in search of annual cost reductions. Over time, however, this laser focus on prices and costs has driven a commoditization of offerings that has limited competition among suppliers merely to the best price for a given specification.
Many manufacturers stood to gain when Walmart opened its procurement process to a new wave of suppliers during its two-day “2015 Manufacturing Summit” held last week at its Bentonville, Ark., headquarters. But some manufacturers already are benefiting from the giant retailer’s 2013 pledge to spend an additional $250 billion on products supporting domestic manufacturing and American jobs over a 10-year period.
There’s quite a political donnybrook going on in Michigan right now, as business leaders froth at the crumbling condition of the state’s roads, while politicians scramble to finger new funding sources after voters in early May solidly rejected the idea of boosting sales taxes to pay for the repairs. But some experts—in particular Harvard Business School professor Rosabeth Moss Kanter, who wrote the book, Move: Putting America’s Infrastructure Back in the Lead—believe other states and cities easily could find themselves in the same place.
U.S. companies reshoring their operations and foreign firms investing in facilities here brought more than 60,000 manufacturing jobs to the U.S. in 2014, according to a recently released report reby The Reshoring Initiative. That’s up roughly 2% from record levels in 2013 and a fourfold increase since 2003.