Supply Chain Networking

It is only a matter of time before millennials begin to build social networking capabilities to support their product purchasing delivery demands.  The extended retail supply chain that includes especially the last mile delivery will feel the brunt of these capabilities built as a result of the millennial mashing together services and tools to meet their own demands.  Millennials will be the leaders in this drive to reshape the retail delivery supply chain to meet their changing demands and these changes will be focused in the area of collaboration and communication to rebuild a consumer supply chain network.  These changes will start on the fringe and in small volume while the millennials mash social and Internet services together to meet their demands and the second wave will wash over eht supply chain as other consumers adapt the new networking capabilities.

Millennials are masters at building collaborative networks and collaborative services to support needs and resolve challenges.  The supply chain consumer delivery is the next frontier in these efforts, millennials are marching through and addressing challenges utilizing the same methods that they used in reshaping the retail shopping and purchasing practices.  Millennials will not accept the status quo in the purchase delivery capabilities just as they did not accept the limitations in retail shopping and purchasing.  The millennials will build out their practices and build their own services through imaginatively building supply chain network capabilities through collaboration and networking.  They will enhance these capabilities through through social networks, wireless technology and mobile apps using the same strategy as was used in shopping and purchasing changes.

Just as the retailers and especially the large legacy retailers struggled to limit the changes, the consumer delivery supply chain will also struggle to limit the changes.  Just as in changing the shopping and purchasing practices they will change the delivery through collaboration and mobile technology to meet their demands.  The greatest area of improvement will be found in coordinating the delivery and this is where the social networking and mobile apps will play the greatest role.  Collaboration within the social network will provide opportunities for consumers to reshape the carrier delivery coordination to meet their changing needs first and foremost.  It is hard to predict how the market will be changed by millennial activities, it is easy to say though that carriers must increase their flexibility in both delivery practices and also communication and collaboration with consumers.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Retail Supply Chain Challenges

The consumer parcel delivery methods and practices have changed very little over the years while the retail market and consumer demands have changed dramatically.  I believe this is because the carriers providing this service have been sheltered from the consumer and their demands on delivery by the retailer because the retailer has been adjusting to the brunt of the consumer changes as they were related to shopping and purchasing.  It is time now though for these consumer demands to extend down the supply chain to the parcel delivery part of the equation to support the changing consumer lifestyles.  Parcel carriers will do well to learn from the retailers mistakes in trying to fight the tidal wave of consumer change and take the steps to collaborate and incorporate flexibility to support the changing demands.

These last mile bulk deliveries and parcel carriers are service providers and as we’ve seen with retail in general where the consumer has now taken control of their shopping and purchasing practices I see a similar type of activity occurring in the delivery services.  This includes Saturday and Sunday deliveries without service fees and also customized delivery times and locations.  The delivery services will say that they provide flexible services based on the consumer requirements and on paper this is true, however the execution leaves a lot to be desired.  I have tried to modify the delivery time for instance with one parcel carrier and that failed miserably ending with me going to the carrier hub to pick up my package on a Saturday.

Consumers have been rebuilding their retail shopping and purchasing practices using the Internet and third party tools.  The delivery services are the next frontier for consumers to change and these carriers may be in for a rough ride when they realize that they are really not in control and must change to meet consumer demands.  Carriers must collaborate with consumers to coordinate deliveries better.  They are providing notices now of delivery status and a first step in the collaboration would be to reach out to the consumer to confirm the delivery timeframe and location prior to loading the truck.

I remember a time when I was young when retail stores were not open on Sunday and closed by six PM on Saturday.  I say this as an introduction here because this was a long time ago and there are many consumers now that never experienced these limitations.  At that time the parcel delivery service carriers provided deliveries five days a week, except of course for the USPS, and there were no evening deliveries.  If we fast forward to today, the parcel delivery service carriers provide deliveries 5 days a week (Saturday for an extra fee), except of course for the USPS, and now consumers can go to a carrier outlet store to pick up their deliveries in the evening if the parcel can’t be delivered in the day.  Contrast this to the speed and amount of change impacting the retailers and you can see that there is a pent up demand from consumers that is going to wash into the parcel delivery service shortly.  In fact, I am surprised it hasn’t already happened!

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Retail Supply Chain Modifications

The retail supply chain will continue to support a very large number of social commerce and purchasing capabilities including increased flexibility and features for delivery to consumers.  The changes being demanded by consumers will not work without the continued support and flexibility of the supply chain and especially the consumer delivery capabilities.  In fact I think that the supply chain is key to the success of retailers in supporting and building out their social commerce and purchasing capabilities.  The supply chain, after all, is the final link to a great deal of the consumer purchases and this number is continuously increasing.  Retailers must extend not only their supply chain capabilities, they must also extend their supply chain partnerships in order to support the changing demands of the consumers.

This does not mean that there is no room for improvement in the consumer parcel delivery supply chain.  One of my greatest frustrations is the inflexibility of many of the consumer parcel delivery practices of many of the carriers.  As an example, one of the home delivery services is my area does not deliver on Sunday or Monday; I can somewhat understand Sunday but I cannot understand Monday.  Of course there is also the brown carrier which does not deliver normally on Saturday or Sunday.  The first thing that must be revised is this hold off from 40 years ago where the goal of the people was to not work on Saturday.  The work week has been changing over the last 20 years and even more dramatically over the last five years and this carrier practice must change as well.  

There are many different manners in which the supply chain can change to support the changing consumer lifestyles and both retailers and their supply chain partners must now also change in order to meet these demands and one of the changes is flexibility in scheduling to support consumer changing schedules.  One easy way to address this is to expand the integration with the neighborhood carrier outlets to allow the consumer parcel to be dropped at the neighborhood store and then only the neighborhood store would require expanded hours.  This could be a good interim change while the supply chain practices are revised.  There is nothing that says that all deliveries and business must be carried out before 10 PM and this would be a great feature for those consumers that are working alternative hours and cannot provide another address to drop the package.  

Every year there are many stories about the struggles for carriers to meet the increased deliveries driven by the shifts from store to social commerce purchasing and it seems to me that extending the delivery hours would be a good method to expand delivery capabilities and this would also increase consumer satisfaction at the same time.  Consumer parcel delivery seems to be the last frontier concerned with consumer satisfaction and these interim changes would only improve the satisfaction.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Retail Cultural Modifications

Retailers and especially large legacy retailers must modify their culture to support the changes demanded by consumers to support their changing lifestyles.  These large legacy retailers must understand that consumers have used social networking, omni channel purchasing capabilities and mobile technology to reshape their shopping practices to support their changing lifestyles.  This means that retailers no longer control the shopping and purchasing capabilities and they must accept these changes in order to survive and prosper in the future. These changes require a culture of collaboration and flexibility that encourages change in the retail space and the manner in which retailers interact with consumers.  It requires a culture of partnership that supports and encourages communication and accepts the expanded role of consumers in the retail marketplace.

Most larger legacy retailers have realized they need to change in order to survive and they are taking steps to implement changes to extend their wireless and omni channel purchasing capabilities.  Some retailers have started an acquisition program to acquire companies to support their omni channel expansion.  Time will tell if this acquisition of capabilities will be coupled with the cultural change required to support the consumer demands.  This is a good start to meet the consumer demands although we have not seen how these acquisitions are planned to be integrated into the retailer marketplace practices and how it will be implemented to create the type of shopping and purchasing practices that consumers are demanding.  

These new capabilities will mean nothing if the implementation plans do not include a new cross functional social network and collaboration framework that encourages feedback and continuous change to adjust to meet consumer changing demands.  The acquisition of capabilities provides a jump start to the change and it also requires a concurrent change in culture to take advantage of the changes and implement a framework of tools, technology and culture that accepts and implements change based on feedback.  Unfortunately, acquisition of tools and capabilities will only prolong the slide without a matching change in culture to embrace the change and implement the collaborative and flexible culture required to carry forward the practices and succeed going forward.

Implementing change requires two ingredients to be successful; capabilities to deliver on new consumer demands and even more important the culture to collaborate with consumers to understand and deliver on future consumer demands.  Of these two capabilities I think the most important is the cultural change to collaborate with consumers.  This is required to not only deliver the changes demanded but also, and more importantly, to understand the consumer's reason for the changes.  Retailers must understand the consumer lifestyle changes that are driving their shopping and purchasing practices changes and they must then adjust their retail practices to align with these changes.  Retailers can no longer simply offer a service and then expect to relax, or more accurately to take their time in delivering the next major improvement.  Retailers must now deliver incremental improvements in a flexible framework that supports a continuous improvement culture.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Social Impact To Legacy Retailers

Over the years there have been many examples of small and nimble retailers overcoming obstacles by quick reaction to the market and consumer demands.  You would think that by now large retailers that have been around for a while would have embraced this concept and implemented techniques and practices that support and encourage quick and nimble reaction to market and consumer changes.  However the opposite seems to be an almost overwhelming draw for the leadership of these retailers. This pull to complacence and what is perceived to be stability is obviously a strong human reaction and tendency in leaders, it is hard to recognize when it is time to change and the ‘if it ain't broke don’t fix it’ draw is hard to overcome.

Human nature is to be drawn to stability and complacence and this tendency in large retail leadership can be seen to work in the beginning of a cycle.  Once in the middle of the downturn the natural reaction for these retailers is to view the market change as a threat to their sales and they react to stabilize their sales.  This is a natural reaction and these retail leaders must fight this tendency in order to survive.  We are in the midst of one of these major cycle shifts now and large retailers are struggling to survive because they are slow to embrace the need to change.  You see this over the recent years when retailers fight the window shopping and other consumer trends in retail omni channel shopping.

The large retailers have paid lip service to the demands of consumers related to social shopping and purchasing, just as they initially paid lip service to the social networks a few years ago.  This highlights a second challenge for the large retailers, namely the cost of change.  Most of the large retailers are hampered by legacy technology that is good at large enterprise management and bad at nimble discontinuous change.  This provide a challenge and probably more importantly an excuse for retailers to struggle to maintain stability and attempts to support consumer change without change to their base systems.  

In addition to these challenges the large retailers struggle with disparate inventory locations and accuracy of the inventory in these locations to fill consumer eCommerce orders.  I am referring here to the practice and ability to fill customer orders from retail stores.  The issue with this type of fulfillment in my experience is challenged by the accuracy of inventory, the availability of clerks to fulfill the orders and then the coordination of delivery to the customer.  In my experience, a delivery from the a store to a customer home can be anywhere up to 12 days.  

These challenges must first be recognized and accepted by retailers so they can begin to resolve them.  These retailers must also implement a culture of continuous improvement and change in order to meet the challenges.  Retailers can buy capabilities but they must also change their culture in order to maintain the growth and ability to recognize and adjust to the changing demands.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Social Commerce Entrepreneur

Social commerce is bringing about a new type of entrepreneur that is comfortable relating across channels and social networks and is also adept and strong at collaborating and building partnerships across channels and networks to support the new consumer demands.  This requires active participation and network building on the part of the entrepreneurs to engage consumers in the social aspect of shopping.  This also requires active engagement and participation on the part of carriers and manufacturers to round out the service offerings demanded consumers.   This can be very difficult for the large legacy retailers because it requires giving up a great deal of control and requires a greater level of collaboration and partnership with both supply chain partners and especially with consumers.

Newer eCommerce vendors have a very large head start on the social commerce entrepreneur engagement and collaboration because they were built in on a concept of flat organization and greater comfort with technology and especially social networks.  Facebook and Google have turned up the engagement through advertising and now eCommerce retail while the legacy retailers have only engaged in Facebook and Twitter as a marketing channel.  Social entrepreneurs in the meantime have been offering tools and methods to shop and engage with others in the social networks to extend shopping capabilities to meet changing consumer lifestyles and demands.  

The legacy retailers have cobbled together solutions that they have convinced themselves support the consumer demands without really engaging and collaborating with the consumers.  Another important aspect is that legacy retailers have also fought every type of social shopping tool and practice that have been developed by consumers because they were afraid to lose sales.  The sad thing about this misguided practice is that these legacy retailers are losing sales because they haven’t accepted and embraced the social commerce entrepreneurial practices.  This has allowed others to step in and offer social tools to support the consumer demands anyway.  

Consumers are searching for engagement and simplified shopping capabilities that meet their lifestyles and they require capabilities that are flexible to change as the consumer demands change.  Many retailers are left behind and failing because they are focused on a legacy practice of delivering functionality that consumers will bend their practices to use and now this retail practice is no longer valid.  We are seeing the results of this rigidity in retailers now in decreased sales and reductions in mall shoppers.  Social commerce entrepreneurs have recognized the change and are running to embrace and engage consumers.  In a way the social commerce entrepreneurs have already one the war and are simply waiting on the large retailers to recognize this.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Social Commerce Interaction

It is easy to say that retailers and manufacturers must change their interactions and relationships with each other in order to support changing consumer demands, but what does that look like?  What it looks like is that retailers, and especially large legacy retailers must change to become more like distributors of products and manufacturers much change to become more like retailers.  The difficulty in this relationship will be determining where one lets off and the other begins and between the two there will be a large gray area where the practices and services seem to cross over.  The power of the Internet, and the social shopping practices that I have been discussing is the support of these gray areas and especially consumer navigation through these areas can be provided in a seamless manner through collaboration and partnership.

The retailer now through the eCommerce channel has begun to provide an endless aisles approach to product offerings and utilizes a drop ship relationship with manufacturers and distributors.  This relationship has allowed the retailer to provide a great deal more options to the consumer for selection and purchase without the additional overhead of additional product purchases, shipping to the retailer distribution center and then the additional costs of handling and storage.  This was a great deal for the retailers and helped to expand selection and sales of products in addition it also provided an additional outlet to the manufacturers and distributors to allow them to expand their product sales.  

This all works great from the retailer perspective while the retailer owns the relationship with the consumer.  This is now where impact is being felt of the growth of the eCommerce sales channel, coming to the point this year of catching up to brick and mortar sales with no sign of slowing.  Now consumers have become accustomed to a blurring of the shopping and purchasing lines with no regards to the outlet from which they purchase.  The purchase is completed by the consumer now based on the provider that best meets the consumer needs at the time of the purchase.  Consumers are using their smart phones now to shop online for deals and more options in product, purchasing and delivery while they are shopping in the retail brick and mortar store.  Add to this mix the growth and improvements in the capabilities of manufacturers and distributors to complete a consumer purchase and deliver to the consumer based on their demands at the time.

The commerce marketplace is now a multifaceted environment that uses the Internet foundation and framework to tie the disparate pieces and services together in an easy to use package.  Consumers are mashing these pieces together in changes ways in order to meet their changing lifestyle demands and the commerce marketplace must be flexible to accept and encourage the changing demands in order to survive.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Social Commerce Retailers

Ecommerce and the growth of millennials in the retail marketplace have already changed the retail market into a social commerce market that crosses channel, retailer and manufacturer to support the consumer lifestyle.  Consumers now are reaching the point where they are viewing and utilizing these social commerce outlets along with brick and mortar outlets as services where the actual retailer or manufacturer supporting the service does not matter.  Millennials have provided the tipping point push that helped to demand the services and then once these services became available the remaining consumers have accepted and embraced the capabilities to support their lifestyles as well.

Consumers do not have anywhere near the same level of free time as in the past and they are open and searching for methods to support their shopping needs and also fit into their changing lifestyle requirements.  I know that when I am shopping for almost any product I generally focus on eCommerce shopping and even when shopping in retail outlets I continuously expand and compare shopping using my smart phone.  I have noticed that this is more of a common practice than an exception and it increases as the age of the consumer decreases.  Each subsequent generation has a greater level of comfort using technology to support their lifestyle and as the virtual and physical worlds blend, the reliance on any retailer or manufacturer will also decrease.  

The next development in retail will be a push for every retailer/manufacturer to change into distributers that utilize any retail channel to complete the sale with the consumer.  The retail services provide the platform for consumers to shop and then to execute the purchase and the Internet provides the infrastructure to deliver these services. The Internet will provide the infrastructure and then consumers, especially millennials and future generations, will provide the push to change the relationship.  The interesting point regarding these changes is that in many ways retailers have inadvertently pushed this change through their focus on the lowest price product offerings and the price matching practices.  

Retailers have themselves have helped to change the consumer perception of retailers from a full service provider to a low price distributer.  The consumers now are pushing and expanding this concept to include not only retailers but manufacturers as well to change their relationship with social commerce and support their changing lifestyles.  Retailer and manufacturers must now focus on changing their relationships and capabilities to support these changing consumer demands.  Retailers have started the change in strategy and demand and now consumers have embraced and are making the demands and expectations their own.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Omni Supply Chain and Manufacturing

Manufacturers will play an enhanced and much more active role in the omni supply chain environment as purchasing and supply demands change.  As these changes develop manufacturers will provide both direct and indirect interaction with consumers to support  these new demands.  Manufacturers have already begun supporting this dual role and have been for a while now and with direct eCommerce offerings to consumers and these same manufacturers have also been supporting eCommerce direct ship offerings from retailers as well.  With the increasing demands of consumers to extend eCommerce purchasing options the opportunity for manufacturers to extend their services will only increase.

Many manufacturers have been experimenting with direct to consumer sales and this will increase in volume as the consumer social shopping and purchasing expands.  As the market for consumer direct sales increases, the opportunity for manufacturers to expand their reach into the consumer market will also increase.  The expansion will come from demand from consumers for mass customization.  You can already see some of these offerings form M&M’s for instance, you can order your customized M&M’s direct from Mars for any occasion.  This is turning into a great outlet where the retailer is not greatly harmed by the manufacturer’s entry into the direct to consumer market. The growth of millennials in the market and their imagination and demands to meet their lifestyle requirements will only bring growth to this opportunity.

All of the pieces to support this expansion by manufacturer’s are in place now and the increase of millennials in the marketplace is now providing the demand necessary to promote expansion.  This expected growth will also impact the the legacy retailer marketplace and will require increased flexibility and collaboration with both consumers and manufacturers to understand the impact and then flexibility from the legacy retailers to incorporate the changes into their offerings.  This requires a dramatic increase in retailer framework flexibility because this is only in the beginning stages of expansion.  I believe though that based on the growth and expansion of the eCommerce market along with the growth in demands from the millennials that the extension of mass customization and manufacturer direct support will only increase.

As a result of these market changes, many retailers will probably transform into a role more aligned with distributor than their current role where they provide an outlet and showroom for product.  Both retailers and manufactures must prepare for these changes in order to maintain and retain their market share.  Consumers have already shown they will take advantage of the opportunity that best meets their lifestyle needs and the expanded role of manufacturers in supporting these demands is quickly becoming the next wave of retail.   

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Omni Supply Chain Delivery

One requirement to future retail success is the product delivery in a manner that supports consumer lifestyles.  This requires a dramatic increase in collaboration across the consumer, retailer, carriers and even manufacturers.  Retailers embraced the concept of ‘endless aisles’ a long time ago to expand product selection to the consumer, however this is pretty much where the concept ended.  Consumers have taken control now of the shopping and purchasing activities to the point where the retail marketplace is being remade to based on these demands.  The next step in the consumer focus is the actual delivery of the product and this is where the collaboration across participants becomes important.  

The retail marketplace has the opportunity now to embrace collaboration with the consumer to remake the product delivery process to meet consumer needs and lifestyle demands.  The delivery and especially the entire supply chain supporting the delivery is now ripe for change and as we have seen with the omni channel retail sales and purchasing, consumers now are just not accepting the stale methods currently supported.  Add to this mix the entry of Amazon into the delivery space and the combination is sure to disrupt the market and the supply chain.  

I know that I am very frustrated with a great deal of the delivery services used to deliver ecommerce orders and realized a while ago that my key frustration lies with the delivery person themselves.  This frustration then extends to the carrier because they are not meeting their commitment and cannot seem to make a simple change in routes and driver practices to improve their service.  This same frustration is occurring, I am sure, with other consumers and I think is one of the key motivating factors in Amazon expanding into the delivery service.  

The second challenge in the retail consumer supply chain is the retailer availability and delivery service level and especially when compared to pure play eCommerce retailers.  Omni channel retailers need to dramatically improve their delivery service for products delivered from another store.  This issue is the result of legacy inventory control systems and a challenge of locating inventory in a store where consumers are continuously moving the product from its standard location.  

These challenges are wide ranging and difficult to address by the retailer, however, they must demonstrate to the consumer that they realize they are challenged.  The first step to improvement is to communicate and collaborate with the consumer.  Consumers have shown over and over again an openness to communication and even adjustment when the retailer reaches out.  The first step though is that the retailer must reach out and open lines of communication and collaboration.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Omni Supply Chain Framework

I see the framework required to support the omni supply chain to be a collaborative (between consumer, retailer and supply chain), flexible and robust foundation in order to support the frequency and the types of change that will be required to support the consumer lifestyle demands.  This is an extension of the changes demanded of retailers by consumers as another requirement for supporting consumer demands.  The consumer delivery marketplace is at the beginning stages of the same type of fundamental change that has been disrupting the retail omni channel marketplace to create a social shopping and purchasing marketplace.  Consumers, and especially millennials, now are expanding their focus to the delivery of goods to support their changing lifestyles.

These new demands require a flexible and robust framework to support the required interaction between the social networks along with an extensive interaction with carriers and then just as importantly interaction manufacturers as well.  This is where the large legacy retailers struggle the most and this is also one key reason why these legacy retailers are losing share to others.  Years ago there were two outlets (brick and mortar stores and online / catalogs) and retailers controlled the marketplace from a product offering mix and purchasing and delivery options.  These days are long gone and now these large retailers that built their model on cost containment through economies of scale are being handed their lunch by smaller and more nimble retailers.  

This is only one piece of the puzzle though and I think now the most important piece in this puzzle is the millennial generation growth and practices in the market.  Millennials are comfortable in the virtual world and they also experiment with combinations of offerings and services to build something that supports their lifestyle demands.  This is probably the single largest impact on the retail market.  The millennials are impatient and will not wait for the large legacy retailers to ramp up services.  This is why the flexible and robust framework is a baseline requirement to the continued success of retailers.  This framework must allow a ‘plug and play’ capability to support adding, revising and removing services as they are requested by the consumers.

This framework must also support and encourage a collaboration between all partners in this new social shopping and omni supply chain environment.  This means that it must encourage and respond to all partners in the marketplace and not control the response.  Unfortunately for many of the large legacy retailers they have struggled against the flexibility for so long because of the cost of investment that it may be too late for them to maintain their stature in the marketplace.  This is the upheaval in the market that we are witnessing now.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Consumer Remake Of Omni Supply Chain

The consumer millennial generation is now beginning to focus on the delivery of product and services that will fit in better and support their lifestyle demands.  This leaves retailers and the supply chain in a continuation of the next phase of upheaval to the retail marketplace.  Amazon has been expanding into the consumer delivery marketplace in order to support and expand their relationship with consumers.  Now carriers should be concerned about the impact this entry will have on their business.  I anticipate Amazon bringing the same focus on consumer demands and willingness to experiment to the consumer delivery market that they brought to the consumer shopping and purchasing market to continue their disruption of the retail marketplace.

I know that there is a tremendous amount of room for improvement in the consumer delivery market for improvement and consumers, especially millennial consumers, are anxious for change to support their lifestyles.  This requires though the type of foundation and infrastructure to collaborate with the end consumer that Amazon has been building since the very beginning.  Now with Amazon’s entry into the consumer delivery supply chain they bring those same traits of collaboration, interaction and experimentation to this delivery services that will surely remake the delivery services market.  This should worry carriers because of the Amazon impact on the consumer shopping and purchasing marketplace.  Amazon does not enter a service or a market without a plan to dominate and the delivery market is no different.

Amazon has already been experimenting with grand delivery concepts in their general practice of experimenting with big ideas.  This practice has a large potential to change the consumer delivery practice as their large ideas and concepts have changed the retail shopping and purchasing market.  Their trial balloon of delivery with drones follows their retail shopping and purchasing practices by throwing out a concept prior to fully defining the concept. This practice allows the review and development of the concept to begin experimentation.  I admire this practice because it allows for development of a large concept in a continuous improvement method that moves the market forward and also allows for tuning and revisions to ensure the concept meets consumer and market demands.

Amazon will work with consumers one step at a time to remake the omni supply chain in much the same way as they worked with consumers to remake the retail shopping and purchasing market.  Carriers should be very concerned now about this expansion into the consumer delivery market for two reasons; Amazon has shown the desire and ability to disrupt a market and the consumer delivery market is now ripe for disruption.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Omni Supply Chain And Consumers

Consumers are demanding new methods and options for delivery that will require a heightened level of collaboration for the entire extended supply chain.  These demands are being ignored and misunderstood by most retailers and the extended supply chain.  This has required that consumers ‘settle’ for options that are least offensive.  This is a very similar environment as retail shopping from five or more years ago.  In the supply chain retailers and the extended supply chain offer services that fit in with their framework and their cost structure.  This has worked in the past because the marketplace tools and capabilities were not available for consumers to put together their own solutions.  All this has changed over the last couple of years and this is now coming together to disrupt the entire extended supply chain to create an omni supply chain.

The catalyst in this disruption is the millennial growth in the marketplace driving change as a result of their comfort in the virtual world and their imagination to mash together options and capabilities in new ways.  Millennials are leading the way in collaboration and developing collaborative methods of shopping and these practices will naturally spread to the supply chain.  Millennials think nothing of rebuilding virtual environments through collaboration with other consumers to create new capabilities that better support their lifestyles.  They have already been instrumental in developing a social shopping environment that blends channels.  It seems to me that it is only natural that the next step then in this growth in influence for millennials should extend to the supply chain.  

I think this is where Amazon enters into the equation to push the disruption forward and I think that the consumer supply chain marketplace is watching their activities with anticipation.  This new social shopping and purchasing consumer environment is searching for a partner to share their vision to incorporate the supply chain and support their lifestyle.  Amazon historically has been a leading factor in reshaping the retail marketplace and now they are extending their focus on the supply chain with their own delivery services and solutions.  Amazon brings an important practice to the table in this area which is their desire and ability to collaborate with consumers to understand the consumer demands.  Add to this the Amazon practice to experiment with solutions and this will be the factor to disrupt the consumer supply chain.

It will be interesting to see how these factors and players come together to reshape the marketplace.  One thing for certain though, the change in the marketplace will only increase going forward by embracing and building new capabilties.  We are in for very interesting and exciting times in the retail market as new consumer demands and new consumer generations remake the market to meet these lifestyle demands.  The constant going forward is the spirit and practice of collaboration.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Omni Supply Chain Direction

The omni supply chain is blending across all retail channels to support a cohesive social shopping network in a manner that allows consumers to purchase and obtain products in the most beneficial manner to support their lifestyles.  This requires heightened collaboration across all supply chain partners and all consumer interaction channels.  This direction has been coming together now for years and just as the combination of mobile technology and improved wireless network capabilities allowed consumers to control their shopping experience, these same technologies will also very quickly impact the entire extended supply chain with similar demands.  The extended supply chain must recognize this and implement a strategy to begin moving in this direction in order to adjust to, and limit, the impact consumers will drive on the supply chain.

One of the greatest disrupters in the retail market is now also moving into the final consumer delivery market and will be sure to disrupt these services just as much as they have disrupted the retail marketplace. The Internet and the Internet of Things (IoT) have broadened now and allow Amazon to offer a range of options to support the consumer demands.  These options were limited by the consumer delivery carriers and supply chain partners performing these services.  These services are limited or offered based not only on consumer demands and they are also limited by the carrier existing limitations and framework.  For instance, FedEx home delivery in my area delivers on Saturday, but it doesn’t deliver on Monday.  Carriers offer and limit services based on their margin and then the service itself contains ‘idiosyncrasies’ based on the carrier overall service framework and limitations.  

This leg of the supply chain I believe is ripe for upheaval by the methods used by Amazon to up end the retail marketplace.  Amazon’s first and most important tools are their focus on the consumer demands and collaboration with the consumer.  Another and perhaps more important point is that Amazon supply chain is not limited by the legacy framework that is now limiting the omni supply chain partners.  For instance, Amazon can easily offer delivery 7 days a week without the turmoil of legacy practices and schedules.  I also see Amazon extended their relationship with the consumer to provide customizable delivery options to meet consumer lifestyle demands.  

The last frontier in the retail marketplace is the omni supply chain that provides that last link to the consumer and also the final opportunity to impress the consumer.  I see the millennial demands to support lifestyle impacting the omni supply chain just as they impacted the retail shopping and purchasing marketplace.  In addition, I see a remarkable resemblance in the supply chain to the retailers in the market from 5 - 10 years ago; the omni supply chain partners are focused on achieving economies of scale to maintain margin which creates difficulties in customizing solutions and developing and maintaining a relationship with the retailers and consumers.  Amazon now is positioning itself to disrupt the omni supply chain just as it disrupted the retail marketplace.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?

Omni Supply Chain Collaboration

The changes coming to the omni channel supply chain resulting from the demands and lifestyle support of consumers will require a heightened and continuous level of collaboration from all partners that has not been required in the past.  Just as with retail shopping and purchasing you can expect millennials to mash features and functionality across the supply chain partners to support their lifestyle demands and then these capabilities will quickly be embraced by all consumers.  Supply chain partners will be forced to increase their collaboration in order to incorporate and support the changes or they will suffer the same type of consequences that large department store retailers are now suffering in the shopping and purchasing marketplace.

These types of services will include services such as scheduled delivery options such as a one hour window and abilities to re-route deliveries within a service area at any time up to the delivery.  The purchases will also vary based on the product types and the consumer delivery requirements.  The deliveries will blend across purchases and other consumer shipments and value added services such as gift wrapping and setup and configuration.  The service demands will grow and change based on the types of products and delivery requirements of the consumer.  The point to be aware of and embrace for the omni supply chain is the absolute requirement to increase partner collaboration in order to survive.  

The chief lesson to be learned from the changes buffeting the retail and even real estate marketplace is the combined requirement of flexibility and collaboration.  Consumers have embraced collaboration in dramatically new levels that is supported by the practices of millennials along with the social network enhanced and expanded capabilities enabled by wireless technologies.  These lessons and practices are going to be extended deep into the supply chain now in order to support the shifting and growing demands of consumers.  These demands extend to and link all partners across the extended supply chain bringing new demands and dramatic changes to the basic consumer interaction.

Consumer demands are increasing and changing in an ever quickening cycle and it is only natural as the changes shift and grow that they extend deeper across the supply chain.  Retailers will not be able to support all of the changes as they grow and this will require increased collaboration with other supply chain partners to meet the demands.  Supply chain partners must start now to collaborate and share experiences in order to support the demands that are coming.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?