In the not-too-distant past, the supply chain was considered an attractive target for cost-cutting and customer service improvements by institutional and retail investors, who were also seeing it as a vehicle for competitive advantage.
As investors continue to allocate a lot of attention to supply chain performance and structure in the wake of the Coronavirus crisis, what factors will they be considering in order to find healthy yields?
Investors will achieve a return on investment by using which supply chain approaches.
First, it is important to comprehend how supply chains need to evolve in order to obtain a competitive edge and to stay in business in the first place.
A change of Roles to a more supply active one.
As a result of these customer choice changes, there is now a desire for a similarly wide variety of fulfilment alternatives. In a similar vein, businesses that include the supply chain in their consumer improvement initiatives earn engagement and loyalty, as well as creating new standards for others to follow if they want to compete.
In summary, the conventional conception of the supply chain as an expensive but necessary support function that exists solely to keep supply and demand in balance is losing favor. It will very definitely continue to do so as the new perspective, in which the supply chain is prominently included in marketing and customer service activities, yields increasingly favorable results for merchants.
Platform Exploitation to Asset Ownership
The typical approach to supply chain management is to spend a lot of money on it. Inventory, storage facilities, transportation assets, and energy provision have all traditionally been obtained through capital expenditures, leaving many firms with staggering sums invested in capital expenditures.
In the form of services controlled via online platforms, digital technology has once again emerged as the key to change. Companies who take advantage of this capacity to source almost everything “as a service,” as opposed to the asset-heavy supply chain, will find it easier to react to constantly changing supply chain issues and needs.
Would you invest in the supply chain? Learn to think like the new normal
The shared theme in all of the findings and concepts in this article is the ability to simultaneously have agile and strong supply chains, along with nimble and elastic capabilities that are ready to deal with changes and complexities typical of the 2020s.
I would argue that “typical” is the wrong term to use, as evidenced by the recent decades during which events and situations have proved that the world does not operate according to typicality. Still, this adds additional justification for businesses to rethink their supply chain strategies.
In terms of institutional and retail investors, it appears safer to invest in such flexible, agile, and asset-light supply networks rather than supply chains. On the other hand, those firms that have moved away from highly capital-intensive, outdated supply chains better suited to an earlier era may now be witnessing the final curtain come down on the good times. If you are a company seeking a certified BV supply chain service in Malaysia, please visit Altus for more.