- THE MAGAZINE
Magazine editors get to experience the effect regularly as a source will undoubtedly drop the perfect quote after the interview – l’esprit d’escalier – or add substantial content when the notebook is stowed and the recorder turned off – doorknob communication.
After completing a podcast interview with Greg Johnsen, executive vice president of marketing and co-founder of GT Nexus (“False Cloud or True Cloud? Debating the Merits of Private Cloud”), we launched into a wide-ranging discussion of the evolution of supply chain management and its supporting technologies.
Companies tend to be inwardly focused, and that is a good place for ERP because, as Johnsen quoted one manufacturer – ERP is good when you are talking to yourself. Supply chains, in contrast, are networks. For a network to perform well, the participants can’t just be talking to themselves.
Earlier technology solutions provided individual departments or functions with solutions – accounting could connect with customers, procurement could connect with suppliers, transportation could connect with carriers. Even those solutions were often complex. (Remember early EDI systems and mapping and remapping data fields?)
Today, we’re moving towards what Johnsen described as a virtualized supply chain. The cloud is at the early stages of facilitating that – as EDI was perhaps 20 years ago. The speed of change, not only in the supply chain but also in technology, is likely to shorten the evolution of the cloud as both a strategic and tactical tool. Instead of optimizing nodes on the supply chain, it will provide a central source where everyone can see what they need to see to act and react to supply chain events.
We are seeing a transition in supply chains with the development of a multisourcing approach that is no longer an all-or-nothing outsource or insource decision. Supply chains are shifting strategies to incorporate farsourcing, nearsourcing, insourcing and any other kind of sourcing you can coin a term for. The hybrid systems don’t remain static for long. A new low-cost source changes a few nodes on the supply chain. New customers – possibly the result of a free trade agreement that opens export opportunities – open new markets. Different and more direct source-to-market routing changes distribution patterns. Or, your sourcing market starts to develop as a consuming market. It’s all about how to be good at change, and the virtual supply chain supported by cloud technology is evolving into the tool to support rapid change.
As one 3PL at the recent Logistics Development Forum told economic developers, he has been asked to find a site in as little as two weeks, and short-notice on network reconfigurations is apparently not that uncommon.
And, by the way, did I forget to mention…
Perry A. Trunick, Editor-in-Chief