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Tuesday, December 31, 2019

Amazonification of Supply Chains

Driven on the consumer side by strong and rising expectations of in-stock and quick delivery.

The Amazonification of Supply Chains
December 30, 2019
Roddy Martin, In Supplychain Brain

In the past, suppliers such as those in the pharma industry stockpiled hundreds of days’ worth of inventory buffer to avoid shortfalls in patient demand. This was “affordable” with 80% margins, but it’s not the case in today’s competitive global marketplace. High margins are no longer guaranteed, and supply chains are responding by pivoting to end-to-end, customer-centric, demand-driven network operating models. In today’s world, business value comes from more than just measuring year-over-year reductions in supply-chain costs.

Modern-day logistics service providers are transforming their supply chains with new customer-centric processes, including demand sensing, demand insight analyses, and promotions capabilities. Contrast that with the billions of dollars spent on both on-premise and cloud-based enterprise resource planning (ERP) systems, which remain largely supply-driven, siloed, and disconnected across the ecosystem — particularly within healthcare.  .... " 

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