Finding new ways to innovate
The retail world is perhaps one of the most rapidly evolving industries in the market thanks to the introduction of artificial intelligence into daily business operations, and it shows most in the creation of the most impressive supply chains in recorded history. As consumers become more and more accustomed to the constantly improving shopping experience, finding new ways to innovate becomes that much more crucial.
Some retailers have already failed in the race to become more efficient. Blockbuster Video went extinct when it discovered too late that nobody wanted to drive to the store to rent a movie anymore. Almost every retailer in the world has to compete in some way with Amazon’s next-day delivery. The days of resting on name brand reliance or half-hearted business models are over; customer satisfaction is the holy grail, and if you can’t stay at the top, you’ll be quickly overtaken by those who do.
Re-imagining your optimal supply chain begins with stating your goals: connect more directly with the customer, create opportunities for growth, reduce operational costs, and build stability within the chain itself. While fulfilling all of these goals may not be possible from the very beginning, starting strong and continually building toward the ideal will drive innovation and evolution as the market continues to change.
Meeting those goals becomes more possible, however, with the introduction of artificial intelligence and machine learning into the equation. Utilizing information from multiple data sources to inform decisions about customer preferences, customer behavior, inventory management, and modes of production helps you become more efficient and more narrowly focused on the insights that will, at the end of the day, make you more profitable.
Planting your flag with machine learning and using its insights to improve your business model and supply chain requires that you rethink the possibilities of what a digital supply chain can look like in the first place. Too many retailers, in their attempts to keep up with an obviously skyrocketing increase in demand for online goods or rapid shipping, built out their e-commerce and digital platforms with too much resemblance to their existing ones, failing to see the bigger picture of what a truly modern digital enterprise could look like. To truly take advantage of a constant influx of data, a supply chain strategy must be built that can constantly evolve alongside the information it receives.
The smart supply chain works both to respond quickly to needs as well as predict where they may arise and preemptively work to act upon them. Reacting to data in real time, it should be able to make changes in real time as well. For example, should the system see that supplies are low in one location, deliveries should automatically be rerouted there immediately so as not to cause a delay in processing or delivery. These kinds of quick responses should be the bare minimum in terms of supply chain capability.
As well as transport goods, though, the data is available to help you engage buyers on a more personal level and predict where the next big shipments will be needed, rather than simply react to them. When you can preempt the customer’s action and have the goods ready before the shipment is even made, you’re taking the next step in terms of customer satisfaction and preparedness to deliver.
Among the key tenets of every data-driven supply chain should be these five major functionalities:
• Connected retailer and carrier
• Complete inventory visibility
• Consistent on-shelf availability
• Order shipment optimization
• Top-down analytically driven
These provide a starting point to work from and work towards, but certainly can be expanded to any number of goals you may have for your supply chain; as we said before, the possibilities are truly innumerable. Having a larger understanding of the purpose and possibilities of your supply chain and its connection with your business and the market as a whole is the first step toward modernizing.