January 09, 2021
The impossibility of affordable two-day shipping actually used to be a thing. What was once uncanny has become the standard, and customers have come to expect this level of service within their buying experience. Even more crazy to consider, plenty of us can say, “Hey Alexa, order more cat food,” without even having to pull up Amazon.
On-demand shipping terms are like a golden goose, and customers have been conditioned to want it now. And if you want to avoid being dropped like a bad egg, it’s time to rethink how businesses approach supply chain management.
Spoiler alert: it’s not enough to just say, “Well, we digitized it so we’re fine.”
The Times Are A-Changin’
Let’s consider the current situation. The younger generations don’t have a lot of patience. You can view this as criticism or you can accept this as one of the defining traits of both Millennials and Gen Z. It makes sense if you think about their lifestyle: these are some of the busiest generations yet, working longer hours, sometimes multiple jobs, participating in the “gig economy” for extra cash, etc. Who has time to browse for stuff at malls when you are driving for Uber and prepping for Monday’s big presentation?
Also consider that the world is smaller and customer demands have never been bigger. Because of this, customers of all ages expect products to be available when they want them and delivered fast enough that it satisfies their needs now. If you need a new pair of shoes for Saturday and you order them on Thursday, it’s not going to do you any good if they show up Sunday.
In short: more demand for specific products delivered faster than ever before.
Big Data can help businesses figure out how to manage their supply chain, but it takes more than a few spreadsheets to really address the present and future demands straining the supply chain. Businesses need to go far beyond just collecting data from a variety of sources; they need to know what to do with that information, too.
For instance, businesses are already experimenting with faster data processing to forecast demand. What was once a monthly activity now occurs weekly. Furthermore, this data analysis doesn’t just pull in internal data but factors in external events as well–everything from changing weather patterns to national holidays. When everything can have an impact on consumer activity, it’s important to have a system that can digest everything.
In fact, the supply chain management of the future will need to look and understand microsegmentation. With more and more focus put on the granularization of customer demand, the most successful businesses will be able to reach and understand the needs of smaller and smaller groups of customers. One size does not fit all anymore.
This microtargeting and microsegmentation might seem daunting but new tools will help businesses meet these challenges. For example, drone delivery services might someday replace delivery trucks so that individual customers can get what they want faster.
Furthermore, we’re already seeing businesses become more accurate and more efficient than ever before. Machine learning algorithms increase accuracy by providing real-time information, while automated shipping facilities mean that products are loaded for delivery the moment an order is placed. Expect that these processes will get better with time.
As systems become smarter and smarter, companies will be able to process a greater volume of information faster and more confidently. Plenty of companies already pull in more data than they know what to do with; the best systems, like Pega, will find omnichannel trends and be able to provide actionable suggestions.
Data without understanding is just digital waste, and thanks to machine learning and AI, companies will be able to do more with the wealth of information they have collected.
Keeping Up With the Future
Faster shipping is like Pandora’s Box. Now that it’s been opened, people expect goods to arrive fast, and oftentimes, the faster the better. If two-day shipping suddenly stopped, could you imagine the outcry?!
We saw a glimpse of what could happen when the pandemic wrecked production, strained supply chains, and caused unexpected delays in goods and services. The systems of the future–while perhaps not able to predict or solve all the problems related to a global catastrophe–will be able to keep supply moving to match demand much better than what we have now. As more and more companies experiment with outsourced production at companies abroad, having a system to keep all the wheels turning will be paramount.
You can use a Magic 8 Ball and hope for the best or you can use data, the power of AI and machine learning to guide your decision making process.
There are plenty of supply chain management solutions out there, but the best take data and help inform other business decisions. Say that there is increased demand of a certain product or service that you discover through your supply chain management system. Wouldn’t that be helpful information to get to your marketing team? Or even to your customer service department, in case that the additional popularity turns into greater demand for help?
In other words, while supply chains grow increasingly complicated, not all supply chain management systems are created equal. Data can be used to keep your goods and services rolling, but the best systems like Pega can help inform your entire business and propel you into the future.
Written By: Holly Thomas
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