E-commerce is the beginning. But it does not stop there. Immediacy will move across channels, markets, and industries.
Additional inventory -- aka, additional working capital or reduced liquidity-- is an underlying factor. Many companies incorrectly focus on it. They deal with--
- Urge to increase inventory because of additional channels
- Allocating inventory by channel which is really an arbitrary action and does not deal with the dynamics and speed of online sales
- “Optimizing” inventory which means not recognizing that inventory "optimization" struggles in the reality of multichannel sales.
The better approach--as part of the New Supply Chain/the Blue Ocean Supply Chain is to:
- Accelerate inventory velocity to inventoryvelocity2
- Compress time
- Integrate the upstream supply chain for key suppliers as determined by supply chain segmentation
- Elevate the integration of process and the integration of technology to advanced levels
- Define the facility network that meets customer expectations and delivers the customer experience