The Hindu Business Line : `Higher productivity key for supply chain success'

THE global spend on supply chain and logistics is estimated at about $1trillion. The CFOs and CEOs of major enterprises continue to invest in technology as this is the best way to ensure return on investments. However, the budgets have shrunk. Mr David I. Beatson, a global consultant in the transportation and logistics industry, and former president of US major Emery Worldwide, spoke about the current business scenario and prospects in the specific transportation and logistics business.

Mr Beatson, was in Hyderabad recently, in his capacity as a director on board Four Soft, a Hyderabad based logistics and supply chain management solutions provider.

Excerpts:

How is the supply chain and logistics business shaping up globally? What is the market size?

The global spend on supply chain services is $1 trillion per year. This includes the activities of order management, warehousing and storage and transportation by all modes. However, this is becoming more organised industry and an area of focus and competitive edge for most of the businesses. As a result, the business opportunities for service providers are also growing.

How is the software services sector doing after the general slowdown we witnessed last year?

The IT services industry is going through a slowdown overall. It will take a couple of years, before the IT services companies begin to witness the same growth rates as in the past.

Are company CFOs willing to invest in technology?

The CFOs and CEOs are continuing to invest in technology. As businesses become more and more competitive, investment in technology for higher productivity is one of the best alternatives to stay ahead of the competition. However, the budgets laid out for technology at this point are not as large as they would like to have.

How is Four Soft placed to leverage this market?

Four Soft has the first mover advantage from two angles that is being an integrated enterprise solution provider and also making it Web centric or 100 per cent on Internet. As a product developed in India, it also has the low cost advantage.

In the service provider segment, we see very little or no competition for the eSupply (SP) product. In the manufacturing, trading, procurement and distribution space, the eSupply (EP) has competition from large ERP companies, but most of them have been deployed on client server or more conventional technologies. These solutions cannot provide the same level of efficiencies or productivity in the supply chain as Four Soft product can.

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`Higher productivity key for supply chain success' — Mr David I. Beatson, global consultant