Commerce 2.0 Supply Chain Execution

Supply chain execution is the second critical function required to support the demands of both the consumer and the retailer.  The execution function puts all of the pieces together from your collaborative supply chain partnerships to complete what is the most critical aspect of the consumer shopping experience; the delivery of the product.  After all is said and done, if the consumer does not receive their product in an efficient and pleasing manner, whether in a brick and mortar store or delivered to their door, it doesn’t really matter how positive the shopping experience.  The two critical factors to the delivery is the quality of the product and the positive experience.

The planning and coordination of both requirements and capabilities all pays off in the execution.  This is clearly not as simple or straight forward as it may sound.  When you are looking at thousands of moving parts and both inbound and outbound orders across the breadth and depth of the supply chain you can see how important planning is to effective execution.  This is also another area where you big data collection and analytics comes into play to provide additional information to support your planning and coordination.  The big data must be shared across all supply chain partners in order to be the most effective.  Probably the single greatest benefit of collaboration is the value that can be derived through sharing information across the partner network.  

Effective planning and execution requires measurements of key performance indicators to monitor and measure the performance.  In addition these metrics help you to identify the areas of improvement and then the effects of your improvement plans and actions.  I think that supply chain execution is all about the metrics, every step through the supply chain can be monitored through the execution statistics to measure and rate the effectiveness.  The key to measuring the effectiveness is the key performance indicator  metrics and an important factor to measuring the KPI’s is the ability to collect the data across the supply chain.  This is why I continue to preach on the importance of collaboration, the value of collaboration across the extended supply chain is invaluable when you take into account the importance and benefits derived from measurements and analytics data that can be provided by all of the partners across the chain.  

The challenge for partners in the extended supply chain comes down to the definition of the metrics and then the analysis of those metrics from the view of the extended supply chain.  This is just the beginning though because once you identified a method to identify the metrics you must continuously review and update which metrics to monitor and this is based on the overall performance of the supply chain and the challenges of the supply chain.  This is not an easy process and it would be most beneficial to the process and the value derived by the extended supply chain to implement a team of cross functional and cross partner members to perform the analysis and identify potential new metrics.

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 consumers’ experience?  Improving the consumers 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?

Commerce 2.0 Supply Chain Flexibility

The shopping demands of consumers place a lot of pressure on retailers to provide flexibility in their delivery channels, whether it is brick and mortar stores, direct deliveries or a hybrid delivery to the store or fulfillment from the store.  This flexibility places additional strain and complexity on the supply chain, as I have stated, the face to the consumer is the retailer, however the structure and framework is supported by the supply chain.  The two critical capabilities of the supply chain is execution and flexibility.  These are two sides to the same coin and your success depends on the success of both sides.  

First your supply chain must be flexible to support the current demands of the consumers and the business.  This can be achieved by developing a collaborative supply chain partner network that will provide the framework and foundation to your capabilities.  A collaborative network is the only framework that will provide the support and flexibility necessary to meet the current and future demands of the consumer.  This partnership should be developed in a manner that provides guidance and structure to the members and also allows the members to share in the success of the entire network.  The members of the network must understand and also subscribe to the key principle that the success of the network is the first priority.  This guiding principle should be reinforced through a shared benefits plan across the network.  Afterall, the definition of collaboration “is working with others to do a task and to achieve shared goals. It is a recursive process where two or more people or organizations work together.” (Wikipedia).  The two key points in the definition are ‘shared goals’ and ‘work together’, this means that your collaborative supply chain cannot be an adversarial network of individuals whose only concern is their individual earnings and profit.  

The collaborative network both collects and feeds on information.  The information collected is based on the demands and execution of the demands.  The information the supply chain feeds on includes the execution and demand information in addition to the feedback from customers and demand planning and forecasting from the retailer.  This demand planning and forecasting must include plans for new products, potential new manufacturing partners, new stores, new consumer programs.  This information is critical to the success of all members of this collaborative supply chain.  One important point to remember here, there should be no assumptions in the communication, it is important that the information, plans and objectives are clearly discussed and understood by all parties.  Assumptions will only impact the execution and as a result the success of the supply chain and as a result, the retailer.

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 consumers’ experience?  Improving the consumers 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?

Commerce 2.0 Supply Chain Partners

The retailer is the ‘face’ to the customer which includes the online presences through all online outlets such as the retail eCommerce site, Facebook, Twitter, Google+, Pinterest, Instagram, Slack, YouTube and any other sites that are customer facing and provide some type of direct interaction.  This is important to the positive and productive relationship with the end consumer, however this relationship with the consumer is also dependent on positive interactions with all of the retail partners that collaborate to deliver a product and services.  Remember to the consumer it does not matter if UPS damaged their package, the bottom line is that the delivery from the retailer was damaged and now how will the retailer react and resolve the issue?

The retailer is represented by many different participants in the supply chain from the raw materials to the end delivery to the consumer.  Each one of these different participants is an integral partner in the retail supply chain that provides and support one to many links in the supply chain.  Each one of these links provide opportunities to collaborate between the partners in order to meet the end goal of delivery to the consumer.  It is important and many times very difficult to maintain the focus on the objective of delivery to the consumer.  This is why it is important to develop the collaborative partnership with the members, or links, in the retail supply chain.  The collaborative partnership allows the partners to focus on the key objective, delivery to the consumer, without diverting attention due to supply chain activities.  

The collaborative partnership starts with the strategy and the partnership framework and guiding principles and this strategy and framework helps to ensure that the partners are focused on the key objective and don’t lose sight of the key customer, the consumer.  This is important for any supply chain because of the potential impact that any one partner in the chain can have on the overall results.  If there is a delay, or worse yet, damage to the shipment from an overseas manufacturer the impact on the retailer’s relationship to the consumer can be disasterous.  The delay would be bad enough and if there was damage to the shipment or even quality issues with the shipment that were not discovered until receipt by the manufacturer it could impact an entire seasons sales and profits.

Do not discount the importance of the supply chain to the end consumer relationship of retailers. While the retailer may be the face to the consumer, the supply chain is the structure that supports and even encourages the successful relationship with the consumer.  As the consumer shopping demands expand the demands on the supply chain will also increase to support the 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 consumers’ experience?  Improving the consumers 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?