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Suggested Citation:"13 Conclusions." National Research Council. 2000. Surviving Supply Chain Integration: Strategies for Small Manufacturers. Washington, DC: The National Academies Press. doi: 10.17226/6369.
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13
Conclusions

First, what's a convergence? It's the coming together of people or ideas in ways that didn't happen before. And the challenging thing about this process is that when it happens, it always changes the rules of math. It causes one and one to make three. That is, the result of the convergence is greater than the sum of its parts. Especially when it involves the development of new technologies (Burke, 1999).

The specific recommendations in this report are the true conclusions of this study. Nevertheless, some salient conclusions pervade the report as a whole, and it may be useful to make them explicit here. Many of the recommendations are not new to SMEs. However, (1) the demands of supply chain integration, (2) reductions in the number of suppliers to OEMs, (3) changing product design technologies, and (4) the development of the Internet, e-commerce, and modern logistics methods are converging on SMEs (and the MEC/TRPs that support them) at an unprecedented pace. This convergence of multiple trends, coupled with unprecedented rates of change within these trends, is jeopardizing the competitiveness of many U.S. SMEs.

In the past, SMEs that failed to respond to changing trends gradually became less competitive. Today, SMEs may find, almost overnight, that they have been surpassed by global competitors and have lost critical customers. With limited resources and the increasing speed of events, they may be unable to respond. Thus, SMEs must be alert to rapidly changing conditions and respond while they still have a business, some

Suggested Citation:"13 Conclusions." National Research Council. 2000. Surviving Supply Chain Integration: Strategies for Small Manufacturers. Washington, DC: The National Academies Press. doi: 10.17226/6369.
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resources, and the time to do so. Many SMEs will require increased assistance from MEC/TRPs to respond effectively.

From a different perspective, this convergence has created unprecedented opportunities for suppliers from low-cost areas of the world. With reduced trade barriers, access to technologies and modern management methods, increased training in English, better educated and more skilled workforces, easy access to the Web to advertise their products, learn about competitors, and bid on jobs all over the world, and the availability of overnight delivery, they can now compete with SMEs in the United States in terms of cost, delivery, quality, service, technology, and all of the other requirements of integrated supply chains.

To respond to these converging challenges, U.S. small and medium-sized manufacturing enterprises must, at a minimum, take the following key steps:

  • engage in meaningful strategic planning, not just budgeting

  • increase their financial, managerial, and technological strengths

  • add value to their products and integrate more closely with their customers

  • integrate their own supply chains to reduce costs and improve performance

These responses will not, by themselves, ensure competitiveness, but they are essential for the successful participation of small and medium-sized manufacturing enterprises in modern integrated supply chains.

Suggested Citation:"13 Conclusions." National Research Council. 2000. Surviving Supply Chain Integration: Strategies for Small Manufacturers. Washington, DC: The National Academies Press. doi: 10.17226/6369.
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Page 108
Suggested Citation:"13 Conclusions." National Research Council. 2000. Surviving Supply Chain Integration: Strategies for Small Manufacturers. Washington, DC: The National Academies Press. doi: 10.17226/6369.
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Page 109
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The managed flow of goods and information from raw material to final sale also known as a "supply chain" affects everything--from the U.S. gross domestic product to where you can buy your jeans. The nature of a company's supply chain has a significant effect on its success or failure--as in the success of Dell Computer's make-to-order system and the failure of General Motor's vertical integration during the 1998 United Auto Workers strike.

Supply Chain Integration looks at this crucial component of business at a time when product design, manufacture, and delivery are changing radically and globally. This book explores the benefits of continuously improving the relationship between the firm, its suppliers, and its customers to ensure the highest added value.

This book identifies the state-of-the-art developments that contribute to the success of vertical tiers of suppliers and relates these developments to the capabilities that small and medium-sized manufacturers must have to be viable participants in this system. Strategies for attaining these capabilities through manufacturing extension centers and other technical assistance providers at the national, state, and local level are suggested.

This book identifies action steps for small and medium-sized manufacturers--the "seed corn" of business start-up and development--to improve supply chain management. The book examines supply chain models from consultant firms, universities, manufacturers, and associations. Topics include the roles of suppliers and other supply chain participants, the rise of outsourcing, the importance of information management, the natural tension between buyer and seller, sources of assistance to small and medium-sized firms, and a host of other issues.

Supply Chain Integration will be of interest to industry policymakers, economists, researchers, business leaders, and forward-thinking executives.

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