The Internet and technological advancements that have been introduced over the past decade have transformed nearly all facets of business, including supply chain operations.
Though it will likely be years before we know exactly what long-term effects these technologies have on supply chain processes, two Arizona State University professors have already started the process.
Elliot Rabinovich and Dale S. Rogers recently created the Internet-Edge Supply Chain Lab to closely examine the relationship between the Internet of Things and various programs, operations and systems. According to its website, the research consortium aims to analyze and assess Internet and digital technologies as they relate to supply chain management, with a specific focus on e-commerce, social consumer behavior and omnichannel retailing.
The influence of e-commerce business and supply chain management
The digitalization of today's business environment has made it possible for people to acquire virtually any product, good or service from the comfort of their homes. While this is ideal for consumers, it presents a distinct set of obstacles for companies.
Internet technologies offer many benefits to business operations, including faster and easier access to essential data and information, increased levels of transparency and insight, as well as expedited delivery times. However, it has also made it necessary for companies to adjust their supply chain processes.
As Rabinovich recently pointed out in W.P. Carey magazine, customers are no longer bystanders; they are now actively involved in the supply chain. The final stage used to be getting a product into stores. Now the final stage is about getting it delivered directly to the consumer's home and efficiently handling return processes.
In the magazine feature, Rabinovich also noted that the level of sociability allowed by the Internet has played a prominent role in matching supply and demand process. Instead of interacting with retail store employees, consumers now make buying decisions from their own home or office, heavily influenced by online reviews and other online shoppers.
The rise of e-commerce also emphasizes the importance of seamless omnichannel retail purchasing experiences, which Rabinovich said is one of the researchers main focus areas, specifically the execution of shipping and fulfillment processes.
Consumers expect a consistent and fluid experience between platforms, from retail and online stores to mobile and desktop applications. And this is not just with business-to-customer transactions, since 86 percent of B2B organizations now offer online shopping directly through their websites, according to a recent Accenture report.
The use of digital devices for data tracking and measuring
With the prevalence of Internet and digital technologies also comes a heavy influx of data. To ensure efficiency, companies must be strategic in their data and tracking analysis. Smart devices provide unprecedented capabilities for tracking and measuring supply chain processes, which is especially important when it comes to inventory management.
"Inventory records at stores generally don't reflect accurately the actual inventory of the stores because store environments are very complex," Rabinovich explained to the magazine. "Customers come and go. They grab products and misplace them. They are not controlled environments, so inventory records tend to be inaccurate."
Digital instruments now allow companies to not only see how much of a product is being bought, but how much of the product is actually being used, how often, and in what way.
The Terra Technology 2015 Forecast Benchmark Study recently revealed 82 percent of the 187 percent greater amount of new products introduced in the past five years have been terminated.
Technological advancements have provided more ways to design, develop and create new products. However, entirely new and innovative items hitting the market can also present complications because it is often difficult to forecast the supply and demand of such products.