SCMAP president Nestor Felicio expressed optimism for the Philippine supply chain sector as economic growth continues and efforts to solve problems and remove roadblocks intensify.
In an interview for PortCalls‘ 29 January issue, alongside other industry stakeholders, he cites the entry of domestic conglomerates and international players into the logistics arena, the growth of e-commerce and resulting prominence of last mile logistics, and the government’s infrastructure development program as positive developments for Philippine supply chain.
Nonetheless, Felicio acknowledges that roadblocks still remain. Physical infrastructure remains an issue, he says, as the Duterte administration’s Build Build Build initiative gets underway. “Although there are projects planned and on-going, many of them will materialize three to five years from now,” he said. “It will become worse before it gets better. This poses a challenge on meeting customer expectations on service levels as well as cost in the meantime.”
A similar roadblock is telecommunications infrastructure. “Our internet connectivity is still one of the slowest in the region,” he said. “The industry has always lived by the need to be agile, responsive and adaptable, especially here in the Philippines, but these infrastructure challenges will stretch our capabilities further. It is like a paper bag that has to hold a fast growing economy – it is bursting at the seams.”
However, he believes several opportunities have presented themselves that would allow the supply chain sector to grow. One is the entry of new technologies. “Investing in new technologies will provide a major part of the answer,” he said. “Not only will it make logistics companies do their work and serve their customers better, it will make them relevant for the future. There is really no choice … It is easy to appreciate that their advantages outweigh the investment and cost.”
Another opportunity are new avenues for collaboration between stakeholders and players along the supply chain. “We’ve seen time and time again why we should do away with thinking in silos,” he said. “The best way to serve customers, achieve efficiencies and create value begins with reaching out to every player across the chain – suppliers, manufacturers, distributors, retailers, consumers – and understanding their needs. We can make the whole supply chain efficient instead of thinking local and short-sighted optimization.”
In the year ahead, Felicio hopes to see an even better appreciation of the role supply chains play. “They say supply chains are the backbone of the economy, and they are also the route towards enhancing Filipino lives,” he said. :It may be daunting as the term ‘supply chain’ covers so much ground, but with wider awareness, everybody can move towards better and more meaningful collaboration, with the goal of serving our customers better in mind.”
He also calls for greater government support for the sector, particularly through a “cohesive road map” in collaboration with the private sector “to chart the course as we move towards being more globally competitive.”
On its end, SCMAP has announced the establishment of new collaboration groups which will target seven pain points experienced by supply chain managers, and has vowed to continue working with stakeholders both in the public and private sectors. It has also begun its first steps towards certification courses in supply chain management, together with the Ateneo Graduate School of Business.
Felicio, who finishes his term as president of SCMAP at the end of this year, is also corporate vice president for integrated planning and logistics management for Unilab, Inc.