Supply Chain and e-Commerce: implementing change

The World Wide Web has radically (and permanently) changed the way in which companies interact with each other and with their stakeholders.

The young field of supply chain management has been turned upside-down by the emergence of the Internet. The growth of web-based data transfer has provided a new, crucial tool to create and improve effective supply chains. Being a cost-effective medium to support supply chain integration, the WWW has contributed to the foundation of the e-Business.

E-Commerce may be the most eminent form of e-Business application: it makes it possible for all the actors involved in the supply chain to quickly identify the tasks they should carry out, connecting brands and customers in a whole new way. By collecting the customers’ desires through the Internet, e-Business has made companies able to immediately respond to ever changing demands.

As a direct distribution channel, e-Commerce has had a deep impact on the supply chains of a wide variety of products.

If we compare an e-Commerce to its physical counterpart (a traditional store), we can easily detect a significant amount of differences in cost structure, profit contributions, logistical requirements, return policies, prices, and much more.

In the e-Business era, customer service has never been so crucial. Consumers want to pay low (or no) shipping costs and they expect their orders to be delivered as soon as possible.

That is how – and why – E-Commerce is transforming supply chains all around the world.

Traditional supply chains are not efficient enough to meet the requirements behind e-Commerce. That is beacuse there is still a considerable amount of spreadsheets, manual processes, and warehouse operation that hinder and slow down the whole process. So: what should companies do?

Luckily, there is a solution. In order to meet the criteria of e-Commerce, supply chain managers have to embrace change and develop a multi-level approach to suit the needs of B2C and B2B trade.

Considering that supply chain management can be easily described as the act of managing the relationships among the actors involved in a supply chain, it becomes clear that the impact of e- commerce occurs primarily on the management of relationships.

In order to achieve the benefits resulting from a multi-faceted approach, an “e-Business friendly” supply chain will be marked by the following features:

  • complete transparency along the supply chain
  • automated stock management, because it is crucial to mantain appropriate stock levels
  • omnichannel distribution (with a high level of customer engagement, downtime reduction, and the optimization of the available resources in terms of logistics and delivery)
  • reinforcement of reverse logistics (warehouse managers should be able to handle returns easily and independently)

In order to achieve the benefits offered by e-Business we have to embrace new supply chain models and set-ups. Thanks to the Internet Of Things, Big Data, and emerging AIs we are ready to enter a bright, competitive future.