Top 10 Thoughts for 2013 and Supply Chains…part 1

Big Data or Real Time Data? Big data is everywhere. But is big data right for everyone? Supply chains are hooked on the idea that nirvana is somewhere to be found in that mountain of information. Is nirvana in that big data or could it be captured elsewhere? What about fast data? For example, do transportation companies need big data or fast data? It is more import to rapidly recognize patterns that might indicate a potential problem with a shipment rather than understanding 2 years worth of transaction data. While others look to leverage big data to extract patterns and insights previously not available – such as retailers who want to compare historical sales trends with promotions coupled with other data such as weather trends. For 2013, supply chain players will determine what type of data is more important to them…some might come to the conclusion that they need both.

Supply chains will look to business process management – BPM has been well known in process oriented businesses such as insurance and healthcare. Supply chains are recognizing the importance of instituting some BPM to their own ecosystems. Think of all the processes that take place within a supply chain – whether it involves the process associated with moving merchandise to bringing on a new supplier. Both vendors and users within supply chain will begin to seek or develop greater BPM suites and applications to bring some sanity to the myriad of processes needed to run a supply  chain.

Who will have a greater role in running your supply chain? Think marketing. Okay I realize that might be blasphemy in some circles, that department that is suppose to create colorful ads and glossies will all of a sudden manage the supply chain? It is already happening at some level – when a CPG runs a promotion it is driven from the marketing side of the business. When you think of what is taught in every marketing class it is about the 4 P’s – product, place, promotion and price. Decisions at this level get pushed back to the supply chain to fulfill a 5th P – produce. Supply chains need to become more integrated with the marketing side of the house. Vendors will continue to find ways to provide solutions that tie together the supply chain and marketing sides of the house.

It is the consumer stupid. Related to the previous prediction, the consumer’s stature within the supply chain will continue to gain importance. A wise sage once said – “behind every B there is a C. There really are no pure B2B or B2C companies, but really B2B2C.” Regardless of what line of business you are in or where you fit in the supply chain, at the end of that chain is a consumer. Companies will strive to get closer to the end consumer – with access to larger amounts of data coupled with more powerful analytics – this will become a reality. Regardless of where you sit in the supply chain, you will have greater access to that end consumer. Those that recognize this and take advantage of the opportunity it affords them, will find greater success in 2013.

More vendor consolidation…and more players. One of the big stories of 2012 was the announced merger between JDA and Red Prairie. I suspect other supply chain vendors such as Manhattan will find themselves targeted by the likes of SAP or IBM to be acquired (SAP also acquired Ariba in 2013 which also greatly impacted the supply chain space). As more of these “pure” supply chain vendors merge or get gobbled up the landscape looks thiner and thiner when it comes to solution providers. Or does it? While the landscape for pure players is thinning, in 2013 we will see solution providers emerging from unexpected places. For example, as I mentioned above BPM vendors such as Pega could begin to offer solutions that address certain supply chain issues. Or even companies such as Amazon will become players when it comes to certain aspects of the supply chain. Think fulfillment, distribution, warehousing, order management and demand sensing. Firms like Salesforce.com will continue to expand from their CRM stronghold and leverage their cloud acumen to become a player within the supply chain arena. As the players that defined supply chain in the late 1990s – i2 Technologies and Manugistics for example – become buried under the layers of consolidation, look for new players to emerge that will help manage your supply chain. And do not be nervous when they come from unexpected places.

Part II coming up….

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