Customer Driven Supply Chains

The last few years have brought dramatic demographic and lifestyle changes, along with an explosion in information available to consumers. In today’s retail and consumer products environment, it is consumers who rule. The explosive transformation of consumer demand is driving complexity and cost into the supply chain. To survive and be successful, industry executives need to understand how dramatic consumer changes are transforming the retail landscape. Consumers not only have more access to product information, but are exercising more control over the information they take in. The days of telling customers what to expect are behind us.

Customer expectations are not consistent with what companies offer. Therefore, the companies supply chains are not allowing the fulfilment of the customers’ expectations. Are these first two sentences true?

Customers’ expectations are not being met because company supply chains are not properly designed to meet these expectations in a way affordable for the company. The customers’ expectations are that your supply chain be personalised to their personal expectations. How are you going to design a supply chain that responds to all customer needs? The key here is not what decision is made but rather who is MAKING THE DECISION. Companies need to realise the customer is the one MAKING THE DECISION.

Understanding the need to design the supply chain to enable the fulfilment of the customers personalised expectations, offering customers the opportunity to personalise their customer service, and designing your supply chain to meet these personalised expectations will not only result in happy customers but also happy shareholders. Companies will not only be satisfying the customers’ expectations, but they will also avoid incurring unnecessary costs to the company.

The consolidation of mega-retailers is forcing the remaining players to differentiate themselves. The one bright spot is that rapid advances in technology are providing levels of visibility and flexibility never before possible. This has rendered traditional means of tracking consumer purchase behaviour and exploded the range of products retailers must offer in order to remain competitive. They need to stay focused on meeting the needs of consumers. To that end, they are building consumer-driven supply chains or demand-based manufacturing that will enable them to sense consumer demand and respond to it in real time. There are no more mass markets ... only niches.

Under this approach, the customer includes the distributors and retailers as well as the end-user. Similar customers should be grouped together – for example, mega-retailers, independents and direct sales to end-users. Determine each group’s key requirements regarding product and service. Also look at the sales volume, sales cycle and trends for each group to further define present and future demand. Your supply chain can then be examined in light of these needs to add or eliminate processes or features.

The objective of today’s industry leaders is simple: Provide high levels of service and a superior consumer experience at every opportunity while also speeding time to market, trimming costs and optimising productivity. More than ever, industry leaders must build collaborative trading relationships characterised by shared visibility, workflow and tight integration – with the common goal of satisfying unpredictable consumer.

Consumer-driven Supply Chain Strategy Services: These strategic consulting services help retail and manufacturing executives understand the big picture – from the business opportunity that the consumer-driven supply chain represents to their specific enterprise to the viability of newly available technologies within their environment; works with clients to assess current capabilities, needs and requirements, then develops a supply chain strategy that will get them where they need to go. The result is a roadmap that can accelerate ROI, while laying the foundation for long-term strategic advantage.

What to expect from Customer-driven Supply Chain Strategy services:

Process expertise. Specialised, fit for purpose.

Bases decision making on a real time, store level view to consumer demand.

Is characterised by flexible planning cycles, to an hourly or conceivably sub-hourly level.

Is highly collaborative and integrated, with shared visibility across the ecosystem.

Measures the supply chain on consumer impact.

Integration skills and partner applications necessary to support clients.

Offerings, from the most basic and tactical, to the more strategic and leadership focused.

Innovating: design and development of a new product concept; processes and applications of product lifecycle, management capabilities translating a change in consumer purchase behaviour.

Sourcing and procurement: help for controlling costs by streamlining the methods for buying materials, components and finished goods.

Consumer-driven replenishment.

Operational excellence: fast, flexible and efficient supply chain executional processes and applications that enable agile responses to changes in consumer demand.

Product quality and compliance: a toolkit that helps retailers and their manufacturing partners meet increasingly onerous product quality requirements, and track and trace regulations from trading partners and governments.

Process enablers: cutting-edge solutions that will serve you today and tomorrow:

Radio Frequency Identification, a powerful enabling technology that streamlines the supply chain and ultimately transforms the retail ecosystem.

Enterprise data management: a set of tools and capabilities for aggregating, managing, sharing and synchronising product information both within the enterprise and with trading partners.

Trading partner integration: a collaborative trading partner portal providing a single window through which trading partners can access the full range of collaborative supply chain processes.

Enabling infrastructure: proven components of middleware collaboration and integration infrastructure solutions.

IT service capabilities, infrastructure strategy, planning, network consulting, system integration management, and maintenance, which help desk and business resilience.

Improved communications and efficient delivery systems.

A just-in-time system with trusted material and components suppliers that reduces costs.

But, like many major business improvements, successful implementation hinges on company commitment and culture. This may require a shift from being operations driven to customer-driven, and some employee discomfort might go along with that. Decisions are based on what is best for the customer, not the maintenance of the internal status quo.

Creating a customer-driven supply chain model for your company may not be simple or easy, but it has the potential to improve profitability, make you more competitive and increase customer satisfaction. All are vital issues in a global economy.

So what are you doing to put your customer at the centre of your Supply Chain and Business thinking?

Dave Food

Prophetic Technology