Improve the Customer Experience First Then Disrupt


#1

Identify the problem you need solved first before you invest in disruptive technology.

You may not have noticed it in the heat of the summer, but there’s been a distinct chill in the air lately, related to the loss of enthusiasm over some of the most highly-touted disruptive technologies. Take blockchain, for instance. While many pilot tests have been launched and industry consortiums founded to address this fledgling technology, the adoption rate for blockchain barely registers among supply chain leaders. And that’s according to one of the industry’s most technology-friendly studies, the 2019 MHI Annual Industry Report, a survey of more than 1,000 supply chain professionals conducted by the MHI and Deloitte Consulting. (A panel discussion focused on the report’s findings was presented earlier this year at the ProMat 2019 show in Chicago.)

You can’t really say supply chain leaders are experiencing buyer’s remorse when it comes to blockchain since, after all, almost none of them have even tried it out yet. Same for some other much-hyped-but-little-used technologies, such as artificial intelligence, drones, and 3-D printing. Oh, to be sure, these technologies all hold a lot of promise… maybe. Someday. But in today’s environment, even with technology investments back on the upswing after a four-year slump, that money is going more for the tried-and-true (sensors, inventory optimization, robotics and automation) than for the still-nascent technologies that aren’t perceived as quite all there yet.

“The adoption rates of some of these technologies haven’t been what we originally predicted when we launched these annual reports six years ago,” admits George Prest, CEO of MHI. “Supply chain people often get enamored of these great new tools, but we sometimes forget that the whole point of the technologies is to better serve the customer.”

For all six years in the report’s history, the number one supply chain challenge has been hiring qualified workers. And yet, for all the promise that digital technologies seem to offer, fixing the talent crisis isn’t necessarily why companies adopt tech solutions.

“Using technology to address labor really isn’t our number one supply chain challenge,” points out Annette Danek-Akey, senior vice president, supply chain, with book publisher Penguin Random House. “It might not even be in our top five.” Disruptive technologies at Penguin are more likely to be addressing out-of-stocks, delivery times and other operational areas, she observes”

Where technology could conceivably help, Danek-Akey believes, is in improving employee engagement, such as facilitating flexible work schedules. And that’s the key to accelerating the adoption rates of these technologies—matching the digital tech to an actual problem that needs solving.

“Reality is starting to settle in when it comes to organizations getting more strategic about adoption of supply chain technology,” notes Randy Bradley, a professor of information systems and supply chain at the University of Tennessee. “These solutions are disruptive, and companies need to stay the course and enter ‘the zone of necessity.’”

“The best way to achieve digital transformation is to start with leadership and the whole culture of the organization,” suggests Joel Reed, CEO of IAM Robotics. “It has to start at the top.”

“It’s challenging to find talent who can think like and empathize with your customers, who have a mindset that can anticipate and understand the needs of the customers,” Bradley says. “You want employees who want to solve problems.”
So how do you get to that point, talented people who think like your customers are eager to join your company’s supply chain mission? Scott Sopher, principal and leader of the global supply chain practice at Deloitte Consulting, offers a couple suggestions:

• Develop a customer-first mindset that seeks to connect with customers in order to anticipate and shape their needs.
• Implement a reverse or dual mentoring program to pair younger, digital native talent with seasoned leadership.
• Partner with regional STEM, career and technical education and university programs to develop future talent pools.
• Create a socially responsible brand to attract your future workforce.

You’ll notice that none of those suggestions involves the adoption of disruptive technologies, but they do share a common link: They require supply chain leaders to themselves become centers of excellence in pursuing recruiting and talent management practices. “The seat of innovation is within the supply chain,” Bradley emphasizes. And that’s what makes supply chain leaders special—rather than channeling their efforts to further just their own needs, their focus is outward, encompassing the goals of the whole organization.