Published June 18, 2019
Now is the time to fully leverage your assets. As you look ahead make sure your strategy is grounded on principles beyond competing in today’s marketplace. You will want a strategy that will put you in a leadership position.
If we can use what we have learned from past information as a firm foundation for the future, there are several clear thoughts and principles that will help to ensure your success.
Your supply chain is a source of competitive positioning. Gone are the days when you can innovate in a silo and develop your own approach that will be successful. Your supply chain team must develop relationships with various providers to unlock capabilities and economies of scale that you alone cannot achieve. Recognizing this single phenomenon is the first step at positioning yourself for success.
There are eight critical trends that you must follow to become a leader.
- The Voice of the Customer
You must understand what your customers’ wants and desires are. It is important to have resources focused on these wants and desires to ensure you can deliver. How often do you just listen to your customers to ensure you are meeting their needs?
Understand how you are positioned in the marketplace and ensure this is a position that is sustainable long-term. Understand how your customers view your competitors to truly understand where you are positioned and how you must evolve to create a niche. All teams within the business need to understand what your customers’ demands are.
- Be True to Your Cause
You must define what makes your business unique. That may be price, selection, convenience, customer service, and any other differentiating factors. Once defined, center the business on these values and ensure you deliver. In everything you do, your branding should be clear. An example that was done poorly is all you can eat buffets. While this was a niche, it was not a unique niche because the all you can eat buffet is easily replicated.
- Customer Expectations of Delivery
As customers’ demands heighten and the immediacy of the pleasure from a purchase increases, so will the need to deliver in a shorter and shorter timeframe. Concepts like distributed logistics will become more prominent to position inventory closer to customers and reduce the delivery costs that can drive as much as 80 percent to 85 percent of the fulfillment costs for short lead times. Recognizing this strategy early and developing an operational solution to respond is critical to meet these demands. Make sure you have a delivery strategy that can economically deliver on short lead times.
- Inventory Planning on Steroids
With distributed logistics, sellers will need to better define their inventory strategies. They will need to select either a lean inventory position (and accept a higher transportation cost) or increased inventory (and harvest the maximum transportation costs). With uncertain demand comes safety stock with inventories.
Do not get caught in the middle of increasing the use of capital for inventory, increased interest cost on the inventory you are holding, and increased markdowns. Develop a robust supply chain approach to harvest the transportation savings while minimizing the inventory investment.
- Robust Delivery Strategies
Developing a robust toolkit of delivery options will be key to selecting the optimal route and cost as needed to meet the demands of your customers. Focus on developing relationships with local and regional players, with the goal of them becoming your long-term partners.
- Partners Will be Your Savior
Businesses will need to develop strong partners to support lean operations and deliver services customized to requirements. The days of simply standardizing an offering is gone. Developing a successful formula for the future will require a unique offering that customers value.
- People, People, People
You are who your business employs. Rather than merely filling a job or finding a certain skill set, what is the culture you want to develop? Do you have a skills assessment framework and do you know the skills you will need to compete five years down the line? Take the time to see your business from your customers’ perspective. Make sure the end business culture speaks volumes to what you value.
Make sure you have a robust skill competency assessment program to understand your team’s strengths, weaknesses, and needed development areas. Put in place a detailed skill action plan to acquire and develop the skills that will drive your team.
- Creativity Finds the Worm
Have you employed a team of creative thinkers and dreamers, those that will test the boundaries of your industry? Find people with energy, creativity, and a desire to ask why to unlock the next level of solutions. Reward this behavior and ensure that your business does not become stale.
Conclusion
Success in today’s marketplace requires your business to be running on all cylinders. By understanding your customers, their demands, your capabilities, and your brand, you can develop a successful approach. Do not allow your business to join the long list of casualties. Put the power of your team’s perspective to work to innovate and deliver on your customers’ demands.
