Enough innovation in South African Supply Chains?



Innovate.jpgToday, a high-performance supply chain is a strategic asset, the complexity of which is increased by numerous factors, making constant innovation a necessity, Tech-Pro Personnel tells SmartProcurement.

Historically, innovative companies that build strategic, high-performing supply chains quickly gain competitive and financial advantages. The PwC Global Supply Chain Survey 2013 found that companies with leading supply chains achieve 70% higher performance and “significantly better financial results”.

And, as factors like intensified global competition, shorter product lifecycles, discerning customers, increasing regulation, improvement in technologies and pressure on natural resources deepen supply chain complexity, innovation has become pivotal to survival and long-term success.

Tom Nightingale, writing for Value Unchained, said that “the historical lesson here is that, with supply chains, innovation is an important accelerator”.

Innovation in South African supply chains

Recent research suggests that South African supply chains share Nightingale’s view that innovation is an ‘important accelerator’.

Some 90% of respondents to Barloworld’s supplychainforesight 2013 Survey believe that ‘new business models require supply chain innovation’, while 91% of respondents to GE’s Global Innovation Barometer 2013 agreed that innovation is a strategic priority for their companies.

Despite this, many feel that they are not yet innovating enough.

Supplychainforesight 2013 found that while 73% of respondents ‘regularly evaluate and modify supply chain strategy to align with business strategy’, 51% feel that their supply chain and logistics functions “don’t innovate regularly enough, often due to company culture, lack of skills and fear of change”. GE’s Innovation Barometer labels this ‘Innovation Vertigo’ - or “uneasiness with the pace of change and confusion over the best path forward”.

Yet, innovation is definitely an intrinsic part of many South African supply chains, as the winners of the 2013 Green Supply Chain Awards show. The awards are a joint initiative between CILTSA, CGCSA and Supply Chain Today magazine.

As examples, Unilever won the Best Project award for the implementation of a local programmable lighting control system at its Jozi Park Distribution Centre that reduced kilowatt-hour usage by an average of 43%, with corresponding cost savings. The RTT Group, who received a ‘Highly Commended’ for their ‘Delivering a Greener Tomorrow’ project, achieved reductions of 57% in energy usage, 61% in waste to landfill and saved 35-million litres of water.

Another innovation that has drawn attention is SEW Eurodrive, an ACM gearbox specialist that overcame dependence on a single customer by shifting the company’s product mix to higher priced products in alternative industries, increasing turnover by 22% and production volume by 10%.

The future

Experts agree that the future of supply chain innovation lies in collaboration and people.

Barloworld’s supplychainforesight 2013 found that future SCM success lies in “serial innovation – built on the principles of continuous improvement and operational excellence; and smart partnerships – strategically selected partnerships with key players across the supply chain”. Both of these concepts drive sustainable advantage.

Similarly, GE’s Innovation Barometer found that the key to innovation lies in “partnership – or collaboration – and people – or workforce preparation and talent mobility”.

But while collaboration between partners in the supply chain is being hailed as the way forward for innovation, there are barriers to be overcome – most notably, according to GE, a lack of IP protection, lack of trust and talent poaching.

As Clem Sunter said “competition in being original has just undergone a quantum leap”. South African companies need to find ways to continually take that leap as innovation is pivotal to future SCM success.

Are South African supply chains innovating sufficiently to stay competitive? What innovative SCM ideas have you come across? Join our discussion on LinkedIn.

Leave a comment

SmartProcurement Newsletter

Please enter your details below to receive the SmartProcurement Newsletter for FREE on a regular basis.

As part of the SmartProcurement Newsletter you will be receiving World Class Procurement News, Tools, Tips, Tactics, Procurement Training updates, Upcoming Events, and the latest Procurement Career Openings.

* Email Address:
* Title:
* First Name:
* Surname:
* Company:
* Country:
* Public / Private:


Career opportunites

Operations Manager

  • >500 000 Gauteng Operations, Planning & Inventory Permanent Supply Chain
Our client within the FMCG industry with a ...More

Warehouse and Distribution Manager

  • >500 000 Gauteng Logistics & Warehousing Operations, Planning & Inventory Permanent
An exciting opportunity awaits for a Warehouse and ...More

Demand Planner

  • <500 000 Permanent
Get an opportunity to be part of one ...More

Procurement Manager

  • >500 000 Gauteng Permanent Procurement Management Procurement Officer / Specialist
An opportunity for a seasoned Procurement Manager, who ...More

Industrial Engineer

  • >500 000 Gauteng Industrial Engineer Permanent Procurement Consultant
An exciting opportunity that offers extensive exposure on ...More

Deputy Director: Procurement

  • >500 000 Contract Procurement Management Procurement Officer / Specialist Western Cape
Department of Economic Development and Tourism:Procurement Specialist, Ref ...More


  • >500 000 Gauteng Operations, Planning & Inventory Projects / Category Management
(Total Cost to Company R750k – R900K) excluding ...More


  • >500 000 Gauteng Operations, Planning & Inventory Permanent Projects / Category Management
(Salary: R 1.3M –R1.5M, dependent on level of ...More


  • >500 000 Contract Gauteng Procurement Consultant Projects / Category Management
Total Cost to Company R1mil – R1.2mil excluding ...More

Project Manager

  • >500 000 Contract Procurement Management Projects / Category Management Western Cape
 Description:A well-known retail organization is looking for an ...More


  • >500 000 Analyst Gauteng Permanent Procurement Management
Description:A leading infrastructure development group with strong presence ...More

Commodity Manager: Fuels and Lubes

  • Commodities Gauteng Permanent Projects / Category Management
 Ensuring continuity of supply in line with business ...More

Senior Facilities Manager

  • >500 000 Commodities Gauteng Operations, Planning & Inventory Permanent
(Total Cost to Company R800K – R900K) Johannesburg Our ...More


  • <500 000 >500 000 Gauteng Industrial Engineer Permanent Procurement Management
(Total Cost to Company R350K – R550K) JOHANNESBURGYou ...More

Supply Chain Analyst

  • <500 000 >500 000 Permanent Procurement Officer / Specialist Supply Chain Western Cape
(Total Cost to Company R350K – R550K)  SOUTHERN ...More

Security Manager

  • <500 000 >500 000 Gauteng Permanent Projects / Category Management Strategic Sourcing
(Total Cost to Company R350K – R550K) JOHANNESBURG This ...More

Demand Planner

  • <500 000 >500 000 Operations, Planning & Inventory Permanent Projects / Category Management
(Total Cost to Company R450k – R550k, dependent ...More

Procurement Specialist-Randburg

  • >500 000 Gauteng Permanent Procurement Management Procurement Officer / Specialist
(Total Cost to Company R700k – R800k including ...More

Solutions Architect

  • >500 000 Gauteng Industrial Engineer Permanent Projects / Category Management
(Total Cost to Company R1.3Mil – R1.1Mil including ...More


  • >500 000 Gauteng Permanent Projects / Category Management
(Total Cost to Company R850k – R950K including ...More