5 Supply Chain Trends You Can’t Ignore (Takeaways from Accellos Conference)

Are you working in a Company of Yesterday or a Company of Tomorrow?

I love that question, which is from a blog posting by supply chain executive and consultant Tony Martins, who was my guest on Talking Logistics earlier this year; Tony was also a panelist in the Mega Trends Impacting Supply Chains session I moderated at last week’s CSCMP conference.

I’ve been asking audiences that question the past few months whenever I give keynote presentations because it opens the door to other questions, such as How do you know if you work in a Company of Yesterday? and What are the attributes of a Company of Tomorrow?

I raised those questions in my keynote presentation last month at the Accellos Visions User Group 2013 conference. Many of the customers in attendance were 3PLs, so I framed my presentation around the following five supply chain trends 3PLs (and their customers) can’t afford to ignore.

Social, Mobile, Cloud are Transforming IT. I’ve written extensively about these topics over the past few years (see, for example, “A Pulse on Social Networking for Supply Chain Management”), so I won’t repeat myself here, other than to underscore an overriding trend related to Social, Mobile, and Cloud: the ongoing consumerization of IT — defined by Wikipedia as “the growing tendency for new information technology to emerge first in the consumer market and then spread into business and government organizations” — which is a key reason why software vendors are starting to compete on ease-of-use and UI design.

Software is Not Enough: The Emergence of Supply Chain Operating Networks. As I discussed earlier this year on Talking Logistics, Supply Chain Operating Networks bring together trading partner connectivity with cloud/SaaS applications. Instead of companies creating hundreds or thousands of one- to-one connections with their trading partners, they make a single connection to the business network, where their trading partners and thousands of other companies are also connected. In addition, they use the cloud applications that reside on the network to communicate, collaborate, and execute business processes in more efficient, scalable, and innovative ways.

Time to Rethink Supply Chain Risk Management. Put differently, companies need to embed supply chain risk management within their corporate DNA. The goal is to incorporate risk in the decision-making process at all levels of the supply chain, just like cost is today. In other words, supply chain professionals need to get to the point where talking and thinking about risk is as common and instinctual as talking and thinking about cost and service. For related commentary, see “Rethinking Supply Chain Risk Management” and “Many Companies are Falling Short on Supply Chain Risk Management.”

Talent Becoming a Competitive Differentiator. Why must 3PLs — as well as manufacturers, retailers, and distributors — think more strategically about talent management? Because best-in-class execution depends on best-in-class people (see “The Case for Competing on Logistics Talent”). But as I highlighted in my posting last week, and the Red Sox have exemplified this baseball season, talent alone is not enough for success. The people you hire, as well as those you already have on your team, including your executive leaders, must also have the right attitude if you want to make it to the World Series of your industry.

Beyond Operational Excellence: 3PLs as Consultants, Technology Providers, and Facilitators of Peer-to-Peer Learning. Simply put, providing operational excellence is no longer enough for success — it’s simply the ticket to the dance. Providing business intelligence and insights, as well access to supply chain experts and innovative technology, are what customers expect from their 3PL partners today (see “4 Important Factors to Consider When Evaluating 3PL Partners”).

While at the conference, I also had the opportunity to conduct video interviews with several of Accellos’ 3PL customers to learn more about the challenges and opportunities they face, and how those factors are influencing their technology investments and priorities.

I encourage you to watch the brief interviews to get the full story on their case studies. But here are a few clips that underscore some of the trends I discussed earlier.

First, here’s Kevin on why Goggin Warehousing chose to deploy Accellos’ warehouse management system (WMS) in the cloud:

And with regards to operational excellence not being enough, here’s Wade from Derby Supply Chain Solutions on the biggest challenge (or “gap” as he refers to it) facing the logistics industry in the years ahead:

And finally, here’s Gustavo about the factors that led Frialsa to look for a modern and scalable logistics software solution. Simply put, the company’s manual processes and legacy software solutions could not scale, quickly and cost-effectively, with its rapid pace of growth — a challenge many 3PLs I’ve spoken with this year are also facing.