In Africa, both the public and private sectors seem ready to challenge the constraints presented by the global economic landscape. But, it is this call to action that needs to produce concrete results.

Within a challenged global economy, strong emphasis on cost management goes alongside a realisation that partnership is essential to the use of the supply chain as a competitive advantage. Therefore, increasing service levels to customers remains the number one supply chain objective, as it has in previous years. This objective must still be achieved at the lowest possible cost, as the objective of lowering procurement costs and decreasing lead times tells us. Essentially, in a highly competitive environment of variable demand, customer needs must be met in the most cost-efficient way possible. What is interesting is a shift in perception about how this can be achieved. The next top objective is improving visibility in the supply chain, followed closely by improving the flow of information between the business, suppliers and customers. This strongly suggests a maturing of the long-held mantra of the supply chain, collaboration. No longer can suppliers be squeezed if the supply chain is to remain competitive – there has to be a more strategic and holistic view that is to the mutual benefit of supply chain players, and offers sustainable benefit to the customer in the longer term. In fact, in industries where the competitiveness of the supply chain is critical to success, such as the automotive industry, the information flow objective is supported by every respondent.

As to supply chain constraints, a more familiar picture emerges. The cost of transport features as the greatest supply chain constraint, for almost every industry sector. South Africa’s high logistics costs, and the imbalance between road and rail, have been well-documented. Sadly, this has been exacerbated lately with the imminent imposition of tolling and carbon tax fees. This is one area that desperately needs effective communication between all industry sectors, since all of them have to move goods, and the government. Over and above the public/private sectors disconnect, companies need to ask themselves hard questions about reducing these costs – are they moving their goods in the most cost-effective way possible? Is each industry considering innovative ways of moving their goods differently – through co-operation with other industry sectors, for example? The bottom line is that there is enormous value to be had in businesses constantly re-looking at their transport strategies and thinking laterally about them. The second major constraint is finding skills to enhance supply chain management. As we shall see, the skills issue remains a burning and urgent challenge for companies across all industry sectors – but can it be addressed in a different way? In the meantime, are companies partnering with the right companies to provide them with such expertise and skills, in a mutually beneficial relationship? Labour unrest, which featured prominently in the South African market and especially in the freight transport sector in the year under review, is unsurprisingly featured as a major constraint. Perhaps more surprising is the presence of ‘reducing the environmental impact of the supply chain’ as a constraint – a first appearance in the top five for this option. The increasing pressure to reduce carbon footprint and to hold suppliers accountable, set by legislation and tax regimes, undoubtedly accounts for this constraint becoming prominent. The pressure on corporations to ‘go green’ is thus affecting the bottom line.