The excess of products, shortage owing, an inability to predict demand, mismatch between the type of product vs SCM, let costs arise when supply exceeds demand and product has to be marketed down and sold at a loss, or when supply falls losing sales opportunities with dissatisfied customers. So we must consider the nature of the demand, devise the SCM that can best satisfy it, identifying a product life cycle, demand predictability of product variety and market standards for lead times and service in 2 point of views that ensure the SCM / Market meditation:
- Functional product: satisfy basic needs, are stable, predictable but invites competition, which often leads to low profit margins.
- Innovative products: contain value added, achive higher profit margins, are unpredictable and volatile demand, is fundamentally build a different SCM.
One of the main trends visualized by SAP Hybris Strategy is: “By 2018, one third of the top 20 in every industriy will be disrupted by digitally transformed competitors.” Said by Frank Gens Chief Analyst, IDC… Expecting the digitalization to be easy to do business with, be better informed than they are, be one step ahead of them and be present where they hang out. In one context that companies must to understanding that: Customer now have control, omnichannel is business, digital transformation is an imperative, marketing is broken, context make the difference, data is the fuel…
So we can focus in how attract with contextually relevant experiences, how convert regardless of channel or device and how retain throughout the customer journey, maybe combining this visión with next questions that will be aligned to deliver an “Experience Management” in Business Models as B2B, B2C and others accelerator products:
How to match Supply Chains with Products?:
- 1st we must determine whether their products are functional or innovative.
- 2nd we have a sense about predictable products and which have unpreditable demand,
- 3rd we decide whether their SCM is physically efficient or responsive to the market.
How to gain responsive Supply of Innovative Products?:
- 1st companies must to accept that uncertainty is inherent in innovative products,
- 2nd understand that the highest profit margins usually go with highest risk in demand,
- 3rd employ three coordinated strategies to becomes more predictable by finding sources of new data, having different products and share common components.
- 4th be against the remaining residual, focus on one segment and use the divisions strenghts to develop a responsive chain avoiding the high risk of overproduction.
When to implement Product Postponement?:
- When the logic of integrated product is manufactured. Thus, the designer must wait for a new integrated component to be manufactured to make design changes.
- When building a system with a programmable logic device, the customer incorporates the logic using software after the integrated component is manufactured.
- When in a programmable logic, the logic system can be set up with the customer.
When to implement Process Postponement?:
- No-postponement: independent and minimum inventory for given level of safety stock, back orders estimated using the demand uncertainty and the planing lead time.
- Push-pull postponement: single inventory, back orders using the uncertainty demand, perfomance improvements to customers that require fast deliveries.
- Partial postponement: parts with the longer back-end lead time: inventory for the given service level, safety stock in finished goods for a maximum level of expected backorders. When few parts have short lead times, keeping most inventory in finished goods.
- Hybrid: allow to reduce inventories and maintain a high level of customer service.
Impementing process postponement requires redesigning products while trying to keep the changes transparent to the customer, wating for short time until the next product-generation release when customers convert their designs to take advantage of speed and price benefits.
With SAP Hybris Strategy we can focus energies in different pillars after reviewing one kind of ideas that we can align into “experience Management” as key point, before to continue with more new tech offer listed bellow:
- Commerce: the delivery of customer experience, product content management, modern – extensible – Standards based, Commerce, Order Management, Accelerators, Hybris extend and the Data Hub (as first consideration before to use SAP HCI), PCM, MDM.
- Billing: supported by 6 use cases for monetization challenges via new model business vision, growing when moving from product to services & outcomes, IoT & Connected devices, Digital commerce and Platform Busines Model protecting with Agility and Revenue Managment Renovation. In 5 pillars: Business Model Design & Pricing Simulation, Subscription Order Management, Usage Metering & Transaction Pricing, Billing / Receivables Collections and Partner Revenue Share.
- Marketing (see image 1): with key points as Marketing & Data Management, Segmentation, Acquisition, Recommendation & retargeting (convert), Planning & Insight and Logalty Management.
- Cloud for Customer: From the delivery vision with IoT, service management, service operation to the omni-channel customer engagement with social channels collaboration, sales, SAP Jam and more with self service visión… self-service, social service, service order management, resource scheduling, mobile, customer service, field service, knowledge, , analytics and more extensions with SAP HCP…
- Cloud for Sales: with paradigms to sell anywhere anytime, turn insight into action, sell more, admin less and know your customer…
Data Management: Gain insight in real-time, enrich across channels in contextual customer view, predict likelihood, social monitoring and engagement; supporting five pillars…
Image 1: SAP Hybris Marketing / Data Management: example.
Integration: can cover a lot of technologies, scenarios, standard or customized proposalsin order to support interoperability into engagement paradigm:
- Technologies: as Commerce, ERP, CRM, C4C, Marketing, B1, Lumira, JAM, PCM, Open Text, SAP HCI, SAP PI, Data Hub, others…
- Scenarios: Data master, Call centers, customer support, Loyalty data, social media / web / commerce / mobile / IoT, ASM B2C-B2B, Opportunity, Leads, Identity Target, Personalized Shopping Experience, Pricing, Sales Quote, others…
- Example of SAP HCI package (see image 2): SAP Hybris Cloud for Customer Integration with SAP Hybris Marketing. Considering the integration process: Confirm Business Activity Replication to SAP Business Suite.
- You can refer to my SAP HCI post: LINK……
- You can refer to my SAP HCI post: LINK……
Image 2: SAP HCI: Hybris package example.
Metodology to create this proposal: all the information here is supported as a personal review process obtaining the information from 3 prestigious authors and institutes (Harvard / Interfaces reviews / OpenSAP), so they are the owners of all rights reserved… The personal work here, was to create a new the review structured in my experience alligned to new SAP tech vision…
- Brown A., Lee H 2000. Xilinx Improves its semiconductor Supply Chain using Product and Processes Postponement, Interfaces, 30 (4) pp 65-80 http://pubsonline.informs.org/doi/abs/10.1287/inte.126.96.36.19950?journalCode=inte
- Fisher, M 1997. What is the Right Supply Chain for Your Product? Harvard Business. https://hbr.org/1997/03/what-is-the-right-supply-chain-for-your-product
- Experience SAP Hybris Solutions by Marcus Ruebsam, Sven Feurer & Team, obtained by https://open.sap.com
- SAP Hybris: https://www.hybris.com/es/
- SAP: http://go.sap.com/index.html