Opportunities and Imperatives for India's Supply Chain Ecosystem Opportunities and Imperatives for India's Supply Chain Ecosystem

As India’s economy enters new era of consumption and growth, it is critical for businesses to understand the macro trends that will shape future supply chain design. Within this context, the Council of Supply Chain Management Professionals (CSCMP) and A.T. Kearney undertook a joint study to determine the major trends that will shape India’s supply chain by 2025 and the impact these trends will have on organizations.

In tandem, A.T. Kearney also partnered with Economic times to the recently conducted ‘Economic Times Supply Change Management & Logistics Conference 2015’, to reflect on the journey and specific challenges faced by India’s supply chains today and the emerging solution themes.

In our first report on the macro-trends, we highlight the six key trends that will impact the future of supply chain in India and discusses how organizations should prepare:

  • More mega cities: Rising population and urbanization will create mega cities and a need for new supply chain models
  • Proliferation of segments: Emergence of new channels and influx of new products will lead to creation of new customer segments requiring customized supply chains
  • Improved supply chain infrastructure: Increased investments in infrastructure will drive larger scale and more consolidated supply chains
  • Better regulatory climate: Regulatory changes, especially with regard to GST, fiscal incentives, and sustainability, are expected but timing of implementation remains uncertain. Scenario-based planning will help in preparedness
  • Increased globalization: As India’s organizations get integrated with the global economy, managing risk, traceability, compliance, and responsiveness will be critical to success
  • Affordable technologies and Big Data: Decreasing costs of technology will lead to greater information on supply chains necessitating enhanced analytical capabilities to leverage this data

In our second report, we highlight the four key road blocks our eco-system faces:

  • Infrastructure gaps: Gaps and inadequacies in the current state of infrastructure are acute and falling way behind demand. Timely and effective execution of projects along with securing firm commitments from stakeholders  will be paramount
  • Unavailability of trained manpower: Lack of institutes providing quality training and unattractive compensation package to laborers is leading to acute shortage of trained manpower. Leaders must strive to anticipate and address the harsh physical realities of these jobs to make them attractive for new talent
  • Inefficient regulatory and clearances process: Regulatory and clearance processes pose significant roadblocks. Going forward, penalties for malpractice, simplification of ineffective or delayed checks, and simplified paperwork, especially in the new GST regime, are focus areas
  • Limited adoption of technology: Real-time information sharing and assessment for future planning is at a nascent stage. Also, use of modern technologies (like advanced tracking) has not found full implementation in India. However, providers and users must continue to invest in technology and automation to derive the right systemic efficiencies

As a result, we believe that the ecosystem is now faced with four key imperatives:

  • Expediting execution of crucial projects to unlock infrastructure and network capacity and investments in developing human capital
  • Greater collaboration across parties to create more systemic efficiencies on assets
  • Developing new planning and process standards that enable easier flow of information and transparency (and)
  • Reducing complexity in terms of logistics assets, systems and processes


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