We’ve all heard plenty about omnichannel commerce — the ideal by which retailers and business-to-business (B2B) merchants deliver a seamless customer experience regardless of channel, device, or location.
Those same principles can and should be applied across the supply chain. Small and mid-market (SMB) manufacturers and distributors in particular have ample room for improvement in how well they manage inventory and/or production, fulfill orders, collaborate internally, and work with partners.
If a faster, more cost-effective business is on your agenda, it’s time to think in terms of the omnichain.nWhat’s an omnichain? It’s a term I coined to describe a modern cloud approach to supply chain management. Instead of separate links in a chain that depend on a linear mix of disparate systems, an omnichain is based on a single cloud-based environment to align and orchestrate all supply chain processes, wherever they occur.
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Compared to the weak links and step-by-step sequences of legacy supply chain operations, the omnichain promotes coordination of purchasing, production, inventory, distribution and fulfillment, all based on a unified data set that resides in the cloud. That opens access to a full range of authorized users, both internal personnel and external partners.
Modernizing from legacy processes
Cloud technology is a prerequisite for the omnichain. It can’t happen when SMBs rely on siloed on-premises applications for inventory, financials, and order management. Certainly, old-school methods like Excel, paper printouts, emails, and phone calls also create barriers. Unfortunately, many SMBs continue to stick to tried and true rather than the potentially business changing techniques that are increasingly available.
Legacy approaches to supply chain management can take a high toll on SMBs. Manual processes are slow and prone to error. Suppy chain managers lack easy transparency into key metrics, from available inventory, production volumes and transportation costs to fulfillment time. High overhead costs bite into margins — or they force price increases that customers won’t readily accept.
Once upon a time, such inefficiencies could be written off as simply a cost of doing business. No longer. SMBs face increased competition from much larger rivals wielding economies of scale, meaning lower-cost offerings. Rising customer expectations and business acceleration are additional triggers for SMBs to transition to a cloud-based omnichain.
How could an SMB get started with omnichain? It’s neither as complex nor as costly as one might think. Foundational cloud technologies for enterprise resource planning (ERP) and ecommerce, widely used among SMB companies, are far faster to deploy than the in-house applications of yesteryear, and without high capital costs.
Thousands of mid-market organizations have made the move to a cloud omnichain environment. They’ve transformed their supply chain performance with a host of advantages not previously possible, including:
- Unified real-time data. SMBs gain groundbreaking capabilities to track all key metrics based on a single source of real-time data. Instead of piecing together outdated information and making guesswork decisions, SMB distributors can see the state of the business and adapt accordingly. Assessing supplier performance, optimizing inventory and minimizing transport costs become routine tasks when real-time data is at hand.
- Location irrelevance. A cloud omnichain makes the location of products, facilities, personnel and partners irrelevant. It extends your reach across the globe or across your country to tap into internal and partner resources as needed, whether to fulfill a customer order or launch manufacturing of a new product. That means you operate faster and better focus on meeting customer expectations.
- Partner collaboration. The omnichain opens new opportunities to work much more closely with partners than is possible with email and phone calls. Purchase orders, specifications and complete record of interactions housed in a cloud portal can be viewed and acted on by authorized partner employees. You build more productive and mutually beneficial partner relationships.
- Internal productivity. Improving internal productivity is often overlooked as a means of cost-efficiency. It shouldn’t be. In fact, better internal productivity is among the low-hanging fruit of a cloud omnichain, as personnel are liberated from the manual toil of consolidating information. That opens the door to reduce costly headcount and repurpose personnel to focus on more value-add tasks that grow the business.
- Speed and agility. Adopting an omnichain approach equips SMBs to become proactive, not reactive, to changes both large and small across their ecosystems and industries. That’s an imperative for SMBs to keep pace with more nimble competitors, while cultivating traditional attributes of exceptional customer service. Avoiding delays or cutting a day from shipment time pays huge dividends in what is quickly becoming a truly on-demand world.
The omnichain is not only within easy reach. It’s already in place at innovative SMB organizations that embrace cloud technology to eliminate the weak links of legacy supply chain operations. Those progressive organizations are well positioned to function with maximum efficiency and visibility and maintain a competitive edge for years to come.