- Sophisticated supply networks with multiple supply routes, stock detention points and customer channels
- Increased pace of product innovation and ?newness?
- Raised consumer availability expectations
- Greater than 50 per cent of promotional participation for some retailers leading to erratic demand patterns
- The challenge of managing a returns flow that can be in the region of 40 per cent of shipped goods
- Minimal lead times being used as a weapon of competitive advantage
Successful supply chain system changeWith the importance and complexity of the supply chain having never been so high, a systemised solution is often essential. The leading forecasting and software solutions provide excellent capabilities such as:
- Intelligent forecast algorithm selection and supported demand history cleansing
- Effective product life management concepts
- Correlation of demand impacts from weather to social media activity
- The incorporation of halo and cannibalisation impacts
- Strategic service level definition, product segmentation and associated safety stock policies
- Full modelling capabilities against complex supply networks
Create implementation balanceFind a balance between changing the business to fit the technology and modifying the software to meet the existing or desired business model
Resource the change correctlyThe internal and external technology teams will be rightly focused on the challenges of successful software integration.? The supply chain operational team will be focused on the day-to-day business and may have limited experience of any large scale change activities. How will the project be resourced to succeed?
Ensure there is the capability to change and prosperThe benefits of the new system will only be unlocked by how the team adopt the change.? An assessment of the proposed future team development needs and structure should be undertaken and a clear people plan defined.? Recruitment for new skills and expertise in order to manage the system at a business level may be required.
Drive effective process adoptionKey barriers and influencers can be targeted in order to ease the change journey.? Bespoke process flows and training programmes should be developed to best suit the needs of the business.
Accelerate benefits realisationAs tempting as it is with a new software ?toy box?, you don?t need to utilise the full system sophistication from day one.? Often the utilisation of the new system in its simplest form will drive 80% of the benefits.? It will also embed the new business processes and provide a solid foundation prior to further optimisation.
Make it stickThe most vulnerable time for deriving the success from a new system is the first six months of use.? During this period the change or project team are likely to have dis-banded and individuals are the most susceptible to adopting reasons to return to the previous methods.? Quality support has to be in place for the team along with a focus on KPI delivery and process consistency.
Make it greatAs advised above, day one might be a fairly modest or conservative system implementation.? Most sophisticated supply chain solutions can be exploited well after the implementation is complete.? A culture of continuous optimisation needs to be put in place and the benefits enjoyed long after the initial change. Simon Dixon is the managing director of supply chain and logistics advisors Hatmill Read on to find out why smaller retailers find technology increasingly critical to acquiring new customers.?
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