think beyond! Supply Chain Metrics in the Digital World! Conventionally all of us have seen supply chain metrics centered on cost and service parameters. A few forward thinking organizations add revenue and assets efficiency related metrics. A lot of efforts are put in developing and running them. However after all this, CXOs still find it a challenge to see how supply chain played a role in achieving the organizations’ objective. So where does supply chain function go wrong? Supply chain functions lacks in both, having the right metrics and also in prioritizing them to the organizational objectives. The question is to find out the mechanism to design metrics that will add value to the organization? Let’s first take a brief look at the prominent business trends that are making it imperative to have a solid performance measurement mechanism in supply chain. Key Business Trends:
We often hear about disruptive business models these days. Let’s face it: the life cycle of business models is continuously shrinking. Organizations’ identified economic value used to last for years if not decades. The incremental business expansion done through product line extension, new geographies and complimenting target group are necessary but in no way sufficient to survive in this new age business scenario. Business models are now subject to rapid disruption and sometimes outright destruction. Consider a few examples: UBER vs. traditional taxi eco-system, Amazon vs. Wal-Mart, Apple vs. Nokia. While all this is in play, cost and service hygiene are assumed to be in place. There is no second thought on that. Whatever new models you bring in, the element of cost and service will still continue to have a significant role. Business risk has been incremental all throughout. Apart from the well known risks such as natural disasters and terrorism, very well informed and connected consumers are also a form of business risk which should be planned well. Digital is the name of the game. Efficiency is now elevated to Intelligence. Companies are therefore building flexibility and embedded intelligence directly into the supply chain processes to help them adapt quickly to changing needs. 1