Reflections on Digital Supply Chains & Platforms
Advances in digital technologies such as the Internet of Everything, Deep Learning, 3D Printing and Big Data are disrupting business models and their respective supply chains. As supply chains become more digital, they increasingly benefit from platforms. A set of common digital technology powered processes, tools and approach allowing users to create value by adding… Continue reading The Rise of Digital Supply Chain Platforms
Omnichannel retail sales have consistently doubled every 4-5 years since 2001 and is expected to become a $1.8 trillion dollar market by 2016 and hit $7 trillion by 2025. Part of the growth is driven by consumers taking their shopping online. However this is just one side of the equation. The other enabler is the… Continue reading 6 Trends Shaping Omnichannel Supply Chain
I recently facilitated the Omnichannel Last Mile panel at the 2015 RILA Retail Supply Chain Conference along with Michael Kors, JB Hunt and Sears. We had a very engaging and productive. It's clear that Last Mile continues to be a rapidly moving and strategic area of focus. Some key observations: 1) Retailers are making a strategic bet… Continue reading Omnichannel Last Mile – RILA 2015
Last week's AT Kearney Digital Forum Roundtable was a great session. I had an opportunity to discuss and hear all things Digital with the leading thinkers and practitioners in the space. Much food for thought. Here are some personal highlights from the venue: - Interesting keynote from Andrew McAfee in framing Digital's impact on the Organization as the rise of… Continue reading A.T. Kearney Digital Roundtable @ R/GA
I recently visited Walmart's pilot Same Day grocery drive-thru in Bentonville. The set-up allow consumers to shop online and pick-up their orders via drive through. This is one of the many innovative, new fulfillment strategies that Wal-Mart is experimenting with as it pushes to bring its Every Day Low Prices to an emerging omnichannel future of endless… Continue reading Walmart activating omnichannel
Getting fulfillment right is much more mission-critical in a digital enabled, omnichannel setting compared to a traditional brick and mortar retail. (see figure below). Fulfillment represents significantly higher costs in omnichannel—up to 15-20 per cent of online-order revenue in the US market. This is about five times the proportion compared to traditional B&M channels. Fulfillment… Continue reading Fulfillment: a Secret Weapon in Omnichannel
The traditional value chain boundaries separating manufacturers and retailers are starting to blur under a digital, omnichannel setting. Brands are becoming retailers and increasingly playing an active role in the consumer Research - Shop - Buy cycle that has traditionally been the domain of retailers. We see this "direct to consumer" as a pervasive and on-going trend across numerous industry sectors. Although… Continue reading Brands are Becoming Retailers
In 2003, William Gibson wrote a prescient novel - Pattern Recognition - that explored the tension between art and mass commercialization in retailing, among other interestingly speculative themes. One area of Gibson's focus was consumer fatigue against ubiquitous brands in an increasingly global and digital market through his metaphoric protagonist Cayce Pollard - a coolhunter who experiences and uses as a consulting tool her… Continue reading Muji, William Gibson and the Future of No Brand
Last mile home delivery is a key driver shaping the growth of the US online sales. While efficient and innovative delivery models abound for parcel products, large format product categories such as white goods, furniture and large electronics remain stuck in an ineffective and inefficient supply chain model, preventing their full potential growth. Despite the need,… Continue reading The Future Model for Big Box Last Mile Delivery
I recently delivered a keynote presentation on best practices in omnichannel supply chain with my A.T. Kearney colleagues and Wal-Mart at the National Retail Federation Supply Chain Summit in Dallas. Our talk, Beating the Burden of Brick and Mortar for Breakthrough Omnichannel Fulfillment, discusses how traditional brick & mortar retailers need to overcome organizational and operational challenges… Continue reading NRF Omnichannel Keynote
With escalating pressures to continually provide innovative offerings and demonstrating sustainable, profitable growth, it’s no surprise that product outsourcing success is becoming a strategic topic in Consumer and Retail. For example, Coca-Cola is transforming their traditional fountain machines for consumer engagement. Peapod is taking the store front to where consumers are through mobile commerce technologies. And… Continue reading Product Outsourcing Success in CPG & Retail
What allows certain companies to deliver best-in-class distribution performance while others turn in only average performance or fail altogether? From our work in this area, we've observed that the leaders in distribution— those that deliver on a defined set of quality and service levels at the best possible cost—consistently think outside the box. Some of… Continue reading The 3 Dimensions of Distribution Excellence
As global markets become more complex, companies are increasingly pursuing collaboration to unlock value chain efficiency and agility. From joint demand planning to asset sharing, companies are seeking to unlock cross-firm economies of scale and scope. A key challenge preventing systematic collaboration is one of participating companies taking opportunistic, zero-sum actions during ambiguously defined scenarios… Continue reading Collaboration: Lessons from Medieval Trading
The prolonged US recession and recent increase in income inequality has energized viewpoints challenging capitalism as a sustainable economic model. Some media and pundits have rallied around the Marx ideology that we are beginning to see capitalism starting to unravel itself. In his "Das Kapital", Marx argues that the capitalist's pursuit of profit accumulation over… Continue reading Capital and Wealth … Was Marx right?
During the 16th century, Spain transformed from a modest European kingdom to a global hegemony. Spain's success was driven by monetizing innovations in trans-ocean navigation and firearms to appropriate vast quantities of minerals (silver, copper, gold) from American conquest. However, like any mismanaged enterprise, Spain's disastrous deployment of its new found capital led to its inevitable… Continue reading Spain’s Colonial Wealth and Enterprise Building
Michael Hu 