Social Media & Supply Chain Strategy

Disclosure : I am no logistics expert!

I was lucky enough to get a free pass to the Strategic Supply Chain Management Forum http://ow.ly/1dtXa organized by the Conference Board of Canada, in Toronto March 2-3, 2K10. Thanks to @JeffAshcroft, and the power of social media, I was able to gain some global perspectives, which I wanted to share with you. So, here is what I learned today, and these are my interpretations only, and do not represent those of the speakers :)

Top 2 Supply Chain priorities:

  • Secure Supply
  • Cost-effective Supply

Three Supply Chain risks:

  • Economy – tighter credit markets, frugal consumers
  • Social Unrest/Natural disasters – Iran/Nigeria (Oil), Chile (Copper)
  • Technology – ability to keep up with the rate of change to maintain competitive edge

Ken Bradley, Lytica Inc. (one of the two speakers on this plenary session. James W. Lawton from Dun & Bradstreet was the other) was also of the opinion Environmental and Green Movement did not constitute as threats to the Supply Chain per se (based on restrictions imposed on CEOs on allocating investments – they’d rather not put money in initiatives that dont have an immediate impact on shareholder value…). He thought they were risks that will be incurred through legislation (like Ross Alliance in Europe), and once in place, all companies would be on a level playing field in terms of complying, and not lose their competitive edge…so not really a Supply Chain risk.

And here is what I enjoyed the most…. he talked about the accelerated rate of change, and the simultaneous reduction in reaction times to address (problems), through a nifty little curve – essentially an inverted half parabola (for golfers, think of it as a high draw), with time on the x-axis, and the “rate of change” on the y-axis. As the curve gets steeper (which it will, led by technology & computing power increases), the time to react is reduced exponentially, and hence the need to be ever agile in reacting, or better still, having predictive algorithms in place, for preventing disruptions in the Supply Chain, need to become standard practices.

On the Supply Chain financing side, there seemed to be 4 main drivers (considerations) :

  • Reducing Cost, and Working Capital requirements
  • Accelerated Cash flows
  • Reducing Supply Chain risk AND
  • Technology (which makes it scalable, visible)

Fergus B. Groundwater from Export Development Canada, and Philippa Fitzsimon from BMO were the speakers on the financing portion.

In both these sessions, there was a common theme with what we see in Social Media. Immediacy & Collaboration – the imperative to respond in real-time, and also to use a more inclusive approach in designing outcomes that fill a particular need – in this case making  sure the assembly line does not shut down because of a custom built screw that your sole supplier could not deliver on time, or avoid a 7 day or $68 million delay due to shopping carts not being there for simultaneous multiple retail store openings.

From what I gathered, SM is by far non-existent in the realms of Strategic Supply Chain Management. It seems they do not have the TIME, which again is a common refrain among hesitant adopters of  SM. However, successful companies will be those that have processes, and policies in place, to harness the power of the diverse web population as part of their overall early warning signal system.

What do you think? Are there any other factors that may impact Supply Chain & Enterprise Risk Management?

Cheers,

Prince

4 responses to “Social Media & Supply Chain Strategy

  1. Lucie Newcomb

    Thanks for sharing, C. What catches my eye immediately is the inverse trend shared with Storage these days: you note Security then ROI; Storage has just moved the #1 slot to bandwidth/capacity, outranking Security. I’m sure there’s a relationship between Storage and Supply Chain; possibly a direct one in many cases. I work mostly in the Services sector, but it’s interesting to think a bit on these things and stay in touch. Thanks for keeping me current!
    – Lucie

  2. Great point, Lucie. With video likely being 90% of all media consumption by 2013, and the explosion of mobile subscription (est. to be 6 billion by 2014), storage is an obvious stress point. Cloud computing will only make this more obvious, although security and privacy (both), and international law will need to be dealt with first.

    Thanks for taking the time to comment. Appreciate it :)

    Cheers,

  3. Prince, thanks for opening the dialog. Just two thoughts re: “processes, and policies in place”.

    Policies, yes. Processes, maybe – because one main focus of processes is to define inputs, outcomes and rulesets for repeatable performance, a major goal being to reduce variation and its cost.

    This tells me processes of a controlling nature will have limited workability for Immediacy & Collaboration. Processes I feel useful here are emergent and self-improving, on the basis of sound policies.

    The four guiding principles and one law of Open Space Technology come to mind. How would these apply to the domain of markets and supply chain commitments?

    • Bernd, thank you for dropping by, and more importantly, sharing your thoughts. I truly appreciate it :)

      I agree with you about processes. I was thinking about enabling processes (say Ent2.0, Web2.0, sCRM) by embracing openness, and empowering diverse participation. At least have a culture in place that streamlines processes under a well crafted policy.

      Curious about the four guiding principles and one law of Open Space Technology? Would love to know more :)

      Thanks again!
      Cheers,

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