How to Develop a Customer-centric Supply Chain

How to Develop a Customer-centric Supply Chain

Supply chain variability creates hurdles to customer satisfaction. Prioritize the consumer experience by integrating flexible technologies and processes in your supply chain design.

Supply chains with significant variability continue to create logistics challenges—with limited distribution capacity, soaring fuel costs, and all-around supply chain fatigue triggering major delivery delays. As retailers respond by increasing their supply chain scope and partnerships, they run into a major problem: limited or nonexistent visibility.

In fact, 69% of companies lack total visibility into their supply chain operations, according to Zippia research. Without that visibility, retailers can’t optimize sourcing, shipping, and fulfillment. They’re also unable to provide transparency to their stores and dynamic retail experiences to customers.

Clear and Responsive CX

By digging deep to understand the nuances of their sourcing networks, retailers can synthesize operations and integrate technologies that support a customer-centric supply chain. The result is a fulfillment process that adapts to consumer needs and provides end-to-end visibility to supply chain teams and logistics partners—enabling a clear and responsive customer experience.

Visibility challenges are often deeply entrenched in company operations, making it hard to gain a complete picture of supply chain logistics. At many organizations, supply chain teams work in silos from other groups, which creates frustration and inefficiencies in upstream and downstream operations.

Returns processes are a prime example. When companies don’t have visibility across different departments’ inventory allocations, it’s difficult to determine where products were initially bought and where they should be returned.

For example, if a customer wants to return a product in-store that they bought online, limited visibility may prevent stores from accepting the item—creating consumer friction in the returns experience and triggering hurdles for reverse logistics teams.

As teams work to process returns with limited visibility, outside partnerships with warehouses, distribution centers, and logistics partners create more opportunities for confusion and communication blunders.

When retailers don’t design for granularity in their outside partnerships, it’s difficult to share data, coordinate timing, and design for transportation and tracking needs. All these factors lead to a cumbersome returns process that potentially degrades the consumer experience.

Siloed processes also make it more difficult to account for marketplace variability. Consumer behavior and supply chain logistics have changed rapidly over the past few years, and world events, sanctions, and shipping regulations require retailers to constantly redesign operational alternatives. This means building additional capacity into supply chain processes, from ensuring extra transportation modes and operators to budgeting for potential overtime.

If supply chain teams work in isolation from other departments, they won’t be able to share data and coordinate logistics details that enable proactive resiliency. They’ll also struggle to meet changing standards and future evolutions.

Cultivating consumer trust and moments of consumer satisfaction stem from efficient and adaptable supply chain processes. As you begin the journey to building customer-centric supply chains, here are four essential technologies and processes to integrate into your strategy.

1. Demand sensing and shaping. To adjust your supply chain to evolving demand patterns, leverage demand sensing and shaping technology. These tools lean on artificial intelligence, machine learning, and real-time data capture to enable alternative supply routes that ensure products move effectively through all supply and demand stages.

2. Available-to-promise technology. Informed by historical customer data, available-to-promise technology increases inventory visibility and helps you understand which orders you can realistically execute. With greater control over inventory and distribution planning, you can more accurately fulfill order commitments.

3. Dynamic inventory. When demand patterns change, you need the right amount of inventory in the right places to fulfill consumer needs. Dynamic inventory enables granular management of inventory allocation and tracking, and facilitates phased order reviews to ensure fine-tuning of order allocations and inventory selections.

4. Flexible logistics execution. Whether products are moving upstream or downstream, flexible logistics plans create a greater need for order visibility, track-and-trace capabilities, and sophisticated planned alternative options. Even the simple option of leaving tailored delivery instructions can boost your logistics agility and increase customer satisfaction.

By designing greater flexibility and transparency in your retail touchpoints, you can enable greater trust in your processes and improve the quality of your customer promise.

As you design a customer-centric supply chain, leverage technology and processes that boost operational agility. Building an adaptable intelligent supply chain plan is not easy, but you can enrich the process. Consider customer demand at every step and prioritize clarity throughout the fulfillment experience.