It’s all about B2Me – Now!

Traditional supply chain planning and execution, based on a static network definition, is reaching the end of its life. Whether related to the omni-channel explosion or the sharing economy, the customer is continuing to disrupt the status quo, prompting many companies to rethink how they go to market.

The companies who have been proactive in their approach have been successful in riding the e-commerce wave and have delivered a personalised and seamless service to customers. This is in part due to early recognition and separation of their business-to-consumer (B2C) and business-to-business (B2B) models, as well as the fact that B2B customers have started exhibiting purchasing expectations similar to B2C customers.
Interestingly, alongside this shift, came a new business model defined entirely around customer-centricity. This new model focuses on the ‘new consumer’ whose sense of urgency is now, and has redefined segmented supply chain planning as we know it. In fact, the ‘new consumer’ impact has been so noteworthy that the business model could very well be named ‘B2Me-Now.’
It all ties back to the customer
The transition to this B2Me-Now environment has been driven by a significant change in how customers approach purchasing decisions. Today, decisions are often made or often socially influenced on the fly, and are therefore not always a true reflection of what the customer needs. Customers’ decisions are increasingly influenced by the price-competitiveness of the offer, the desire for a seamless and similar experience across all channels, an easy purchasing and return process, and most importantly, the ability to personalise the product — and have it delivered now.
Additionally, the customer’s expectation for real-time visibility into the order life cycle is soon to become a key factor. Through the use of smart technology, customers want to know at all times when their purchases are expected to leave the warehouse, where they are in transit and when delivery is promised. By offering customers cross-channel purchasing and delivery flexibility, the point of purchase and point of consumption are often not the same. This extreme focus on customer-centricity warrants a game-changing approach to understanding and responding to the customers’ needs.
This new uber-consumerism will require the upstream supply chain network to be flexible, fast and above all profitable. Companies that continue to rely on traditional approaches to supply chain planning and execution will fail.
The need for a flexible, fast and responsive supply chain
To better serve the B2Me-Now consumer, companies need to move away from the traditional bi-linear supply chain model and adopt a multi-dimensional supply chain grid model. This grid-based approach adapts traditional supply chain planning and execution constructs to better sense and respond to ever-shrinking lead times across the value network. To accomplish this, the traditional enterprise supply chain network can no longer be defined by static connections. Instead, it must be replaced with a dynamic network that can evolve with time and interface with the Internet of Things (IoT) and emerging digital technologies. This supports real-time sensing and real-time responses, forming the foundation for informed, rapid and optimal – as well as profitable – decisions.
The B2Me-Now model also requires adaptable supply chain processes to meet the personalised point-of-purchase, consumption and return needs of today’s customers. E-commerce has ushered in many changes in this area; it is no longer uncommon for the point of sale (POS), consumption and return, to span different coordinates across the globe. For instance, a customer could purchase a tablet online in London, but want it shipped to Paris and might decide to return it, or have it serviced, while traveling in New York. Companies can no longer rely solely on past localised purchasing activity to predict future purchases, consumption and returns.
The demand planning process redefined
The fundamental challenge now lies in how companies should direct their demand-sensing activities. Should it be focused on the product that is being bought, the attributes of the product (such as colour, size, etc.), the purchaser, the region of consumption, or the price point of the product? This challenge goes beyond traditional forecasting methods; the process calls for additional artificial intelligence to sense and predict future demand across a continuous spectrum, potentially looking past purchasing history to include an increasing number of unstructured data inputs that could shape and enhance the near-term and short-term forecast. In this case, both data and time become critical supply chain components, spurring the transition from structured and static constraint-based planning to an agile, ‘always-on’ and responsive B2Me-Now model. Additionally, the physical supply chain network, often characterised by asset-heavy and capital-intensive investments such as manufacturing plants, contractual labour, spacious warehouses and fleet vehicles, can no longer be rigid if it is to support real-time decisions.
Any changes to the POS or point of consumption will create a ripple effect upstream. Thanks to the prevalence of mobile devices, apps and widely available connectivity, the POS is no longer static. The ability to consume products or services more flexibly, without judgment or undue influence, has become dramatically easier. Upstream partners will now have to account for the new risks and opportunities introduced by this phenomenon and respond to them more quickly.
Being Flexible is the Future
The B2Me-Now business model has pushed the envelope of just-in-time collaboration, requiring the supply chain to be hyper-responsive. This can only be accomplished when organisations step away from the rigid definitions of a linear supply chain and instead adopt a flexible and adaptable supply chain grid model that is more resistant to the demand and supply swings driven by today’s consumer. After all, companies will only be successful in this B2Me-Now environment if they can meet customers where they are, with the products they expect, when promised.
By Doug Kimball and Srini Muthusrinivasan- JDA 

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