LTD Management
Logistics & Supply Chain Management Consulting Global Solutions That Work

THE NEW SUPPLY CHAIN PARADIGM

Omnichannel, driven by e-commerce, is the dynamic, new business model to sell across channels for both B2B and B2C. Even more, it has created a new supply chain paradigm.

It is a strategic, competitive, and a disrupter to traditional selling. Omnicommerce has redefined and expanded markets and customers. Its value applies not only to retailers; manufacturers and middlemen must also adopt and adapt to it.

There has been a standard view of supply chain management, and supply chains have become static. Now there is the reality of supply chain divergence. Conventional supply chains -

Omnichannel necessitates distinct ways to service each channel's customers. Supply chains often have a single focus and are an amalgamation of discrete actions by internal and external parties that add time. Time is critical for the service required by customers.

Supply chains are not designed to effectively handle multiple, distinct channel needs, especially those that are speed sensitive. Supply chain management, as presently practiced, is becoming out-dated by omnicommerce service demands.

E-commerce has immediacy to it. Even supply chains that originated with e-commerce firms are falling behind. They were designed along customary ways to pull orders and ship. These use website design and shopping cart technology to mask inventory and other supply chain issues.

New supply chain dynamics are emerging. Omnichannel and its e-commerce have become competitive forces for supply chains that force changes with internal and external participants and stakeholders. Paradigm supply chains -

Time compression is important for service velocity, inside and outside the company. Inventory positioning; network redesign, both technology and logistics; total supply chain visibility; reduced redundancy; coordination of inter-related activities around the world; inventory velocity; and a fresh breed of logistics players are needed for compression.

Underlying this supply chain is its structure. Supply chains are built from the company outward to customers. That approach will no longer work. Supply chains must be designed and operate from customers back to companies to satisfy demand requirements.

The change for supply chain management has begun. The power of this new supply chain will not be limited to omnicommerce. It will transform supply chains for many channels, industries and markets who will want "immediate" service performance.

Supply chains must be streamlined for the paradigm. Outsourcing and logistics service providers - be they 3PLs, transport firms, warehouses, forwarders, and others—must be able to drive performance.

Those who implement omnichannel with traditional supply chains will struggle to achieve maximum benefit. Using old supply chain practices with a new business model is shortsighted. The new supply chain paradigm will dominate omnicommerce, and eventually nearly all businesses.