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Supply chain the new rock and roll for cilt conference 2014

Joe Tarragano was invited to speak at this year's Chartered Institute of Logistics and Transport conference. Providing observations on what's driving the agenda for supply chain leaders, Joe shared his retail observations and looked at the technology and consumer trends affecting the industry today.

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Supply chain the new rock and roll for cilt conference 2014

  1. 1. SUPPLY CHAIN – THE NEW ROCK & ROLL
  2. 2. 2 Critical importance of supply chain and logistics competencies “In this era of online retailing and Omni-commerce, there are two leadership competencies that will differentiate tomorrow’s executive leaders in retail. They are a deep understanding of social-media fueled marketing and Internet focused retailing, and a deep awareness, understanding and appreciation of end-to-end supply chain inventory deployment and fulfillment capabilities. From our lens, recruiting for retail C-level executives has been too focused on classic merchandising, finance or traditional brand marketing”. Ferrari Group
  3. 3. 3 GET IT TO ME
  4. 4. 4 THE EXPECTATION OF MORE CHOICE KEEPS RISING •  The norm will become 7 day per week, day time or evening, 1 hour timed slots, with advanced notice •  Not always an economically sound offer for retailer or buyer •  Multiple pick batches & cut-offs, multi-way sortation, sophisticated carrier management solutions become standard
  5. 5. 5 ARCHITECTING FOR AGILITY IN A RAPIDLY CHANGING WORLD
  6. 6. 6 YOUR CUSTOMER HAS A VIEW ON DELIVERY Source: Collect +, CILIT
  7. 7. 7 THE FINAL MILE IS THE ZERO MOMENT OF TRUTH • “Supply chain directors will be brand directors” Richard Cristofoli, Debenhams Marketing Director
  8. 8. 8 LET ME GET IT
  9. 9. 9 WHERE CAN I GET IT?
  10. 10. 10 ANYWHERE IS A COLLECTION POINT
  11. 11. 11 NOT ALL PARTNERS WILL BE OBVIOUS
  12. 12. 12 THE STORE MAY NOT BE AN IDEAL COLLECTION POINT •  The greatest growth is typically coming from your highest cost-to- serve channels: convenience & home •  Supporting a click & collect proposition into some of those convenience locations is particularly challenging
  13. 13. 13 THE STORE EXPERIENCE IS ALSO CHANGING
  14. 14. 14 RANGE EXPANSION IS A STRATEGIC IMPERATIVE
  15. 15. 15 DROP SHIPPING A ZILLION SKUs 7 million home products 8,000 suppliers $1 billion sales (2013, up 50% YoY) 500,000 products 800 brands
  16. 16. 16 TAKE IT BACK
  17. 17. 17 THE RISE OF RETURNS FRIENDLY COLLECTION POINTS
  18. 18. 18 IT’S NOT SOLD UNTIL IT’S USED
  19. 19. 19 AND WHAT OF THE STORE?
  20. 20. 20 Does my bum look big in this? •  Lots of retailers have experimented with virtual mirrors and augmented reality •  Social proof is a powerful support when shopping
  21. 21. 21 The boundary of a store is dissolving •  The humble shop window is a 24 hour, interactive digital shop •  And who needs an actual shop window
  22. 22. 22 Inside, the definition of a store is changing •  Digital interaction, reduced stock, cleaner lines are becoming common •  The shop is the social space, the theatrical space •  Handheld devices enable a different type of customer interaction
  23. 23. 23 Minority report is here •  Facial recognition has been around for a while •  Footfall tracking can now approach web-style journey/ dwell/conversion analysis •  Personalised, enriched experiences differentiate
  24. 24. 24 Google Glasses •  All manner of issues around communications and privacy etc •  But adoption by sell-side rather than consumers may be earliest uses –  Fiat Brazil is using it for virtual tours –  Virgin Atlantic is also engaging with it
  25. 25. 25 WHAT DOES IT ALL MEAN FOR ME?
  26. 26. 26 APPROACH PARTNERSHIPS DIFFERENTLY 1.  With increasing uncertainty and more need for flexibility and fail- fast approaches, the risk-sharing model need to change 2.  Rather than long-term contractual relationships, we can expect a move to shorter-term partnering
  27. 27. 27 BE AGILE 1.  Architect for rapid adjustment and learning 2.  This is different from designing for maximum flexibility 3.  Root the foundations in customer-centric thinking
  28. 28. 28 SOME CHARACTERISTICS OF NEW SUPPLY CHAIN LEADERS 1.  Commercial and entrepreneurial in nature 2.  A change agent 3.  Strong influencing skills 4.  Operating cross functionally 5.  Builds an innovation capability 6.  Embraces a fail-fast mentality
  29. 29. 29
  30. 30. THANKYOU

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