A good company can fundamentally change consumer attitudes and expectations, however, the opposite holds equally true
The rise of on-demand delivery is therefore placing significant pressure on retailers; and the need to compete in this new market is driving many to look again at their own supply chain operations. Even if they don’t have the resources of an Amazon, tightening up their supply chains allows them to leverages such advantages as they do have.
Firstly, there needs to be a much more profound understanding of supply chain not just in the supply chain team but right across businesses – store handling, warehouse operations, home delivery and returns, manufacturing, transport, the lot. But rather than wait for sales, marketing, finance, HR and the rest to catch up, senior SC executives really need to understand how the rest of the businesses they are engaged in work too.
The bedrock of the future will be built on the improved collaboration between departments that this move ushers in. This requires a new phalanx of educated trained professionals because to do that in the increasingly complex environment demands people of the highest calibre. As computational power increases the best systems will give higher and higher degrees of visibility over larger supply networks. At present many companies’ planning is done monthly. In the near future the picture will be updated at least once a day (this is already increasingly common) and will move towards a real time overview of the entire supply operation across all transport units, stores, DCs and SKUs.
On-demand delivery places even greater pressure on the whole end-to-end supply chain, in a way that will require continuous scenario-testing: the potential inaccuracies, the things that need contingency planning, and the hard-to-predict factors. Then, armed with these forecasts, companies can decide on responses to any given event that’s been played out. Such scenario-testing also enables much closer collaboration between teams; indeed across the business as a whole. By identifying where in the supply chain the potential pinch-points lie, any uncertain situation can be played out in advance and as many likely permutations gamed and planned for. That way, in the thick of the season, the system will be primed to deal with issues so people don’t have to. In doing so, the system allows the business to focus on the areas of the business that the C-suite worries about most: reducing risk, and maximising resource – both financial and people.
In the longer term resource sharing could be one of the most interesting areas of potential development in supply chain. There is a distinct possibility that we will see the sharing economy extend to supply chain via an Uber- or an Airbnb-type app to provide easy access to logistics and warehousing, for instance, for those without enough, and the chance for those with excess to monetise it. Could sharing be the way for all the minnows to join together and scale up to take on big fish?
Whatever the future of the retail delivery landscape, one thing is certain: The importance of supply chain within the business world is only set to grow.
