Thursday, June 19, 2014

NEW SUPPLY CHAIN PARADIGM AND MODEL

There is a new paradigm for business models, both B2B and B2C, and for supply chains. Bricks and mortar stores and big box retailers have to deal with and compete for local, national, and global customers with online, ecommerce, cross channels, multichannels, and omnichannels.  Wholesalers, distributors, and other middlemen have to adapt also to this reality. Manufacturers, those with large scale factories  or not, must acclimate.  Companies that have failed to engage customers with superior supply chain service are especially challenged with what is happening.

For years, there has been a "standard" view of supply chain management; much discussion, despite new buzzwords, has been static. Now there is the reality of supply chain divergence and supply chain segmentation.  Inventory positioning, cycle time compression, and inventory velocity are required to deal with meeting customer expectations. 

This means new supply chain dynamics. Complete visibility across the supply chain. New organizations to manage the global scope and service demands.  Coordinate internal and external inter-related actions and activities across the world.  Rebuild supply chain networks, both warehouse and technology.  Have new KPIs to measure performance for the company and for the supply chains. Revise outsourcing needs.  Reduce redundancy. Develop differnt logistics players. Build new teams, both internal and external, that reduce conflicting interests.

The above is just the beginning.