Legacy Supply Chains Aren’t Fit for Purpose in the Age of Customer

Businesses in Asia-Pacific face what is arguably the most critical customer experience imperative in the world. This is because here, 71 percent of consumers make online purchases[1] and investment is e-commerce is on the rise. Meanwhile, consumers are becoming more demanding: 76 percent of consumers in the Asia Pacific region now say that customer service should be a company’s top priority[2]. Businesses across Asia must, therefore, do all in their power to raise the game and create winning customer experiences that keep people coming back for more.

Business leaders in the region today are challenged with delivering differentiated customer experiences; leading many to rethink the way they design their supply chain operations. These organizations must cope with exponential demand, and supply chains need to become much faster and precise.

As businesses in Asia set out to meet these challenges, 2018 looks set to be a critical year, with 94% of supply chain leaders saying that digital transformation will fundamentally change supply chains this year[3]. Moving quickly, business leaders in Asia are investing in digital tools to obtain real-time demand data, shorten replenishment cycle times, optimize deliveries and predict future demand. The rest will be left behind.

Who exactly are these leaders? There are many to choose from: the Asia Pacific market brings together the right combination of logistics and e-commerce expertise required to drive breakthrough innovation. Where this innovation happens, customer experiences are taken to a new height.

Supply chain transformation in action

Take SpeedFactory by Adidas: a concept that’s making its way to Shanghai and Tokyo. SpeedFactory uses advanced 3D printing technology from Carbon, Adidas’ supply chain partner. The printers allow athletes to order hyper-personalized running shoes with unique soles that are tailored to individuals’ weights, foot contours, and running styles. The shoe design even incorporates data that takes account of conditions in different cities, thereby meeting the needs of runners in the exact environment in which they’re running.

By rethinking its supply chain, Carbon has enabled something special: marketing on a truly individual level. In part, it has been able to do this through advanced cloud applications for areas such as customer service, procurement, inventory, order management, manufacturing, and supply chain. The cloud has made it easier for Adidas to interact with a global supply chain in an economical way – essential as it ramps up production with global brands.

But it’s not only consumer brands that are enhancing the customer experience through supply chain transformation. Take Bac Ky Logistics. This Vietnamese logistics company has embraced automation to deliver a stronger overall customer experience. The company has completely automated the scheduling of transportation and delivery management; in the process enhancing transparency and speed of service for customers. The company has also used advanced, data-driven cloud applications to better visualize its supply chain, logistics, and trade information in real-time. This has helped it optimize resourcing and reduce the number of empty containers.

Other organizations are looking at the power of supply chain transformation to play an integral role in the move to digital. Thai company Tipco Asphault manufactures and distributes asphalt products servicing road construction, maintenance, and paving industries. Having launched its ‘iChange’ strategy to transform the organization to respond to the imperatives of digital and industry 4.0, it needed a cloud specialist to help modernize its supply chain and thereby enhance the customer experience. Tipco’s strategy centres on overhauling its IT system across key business units including management, purchasing, production process, transportation, distribution, sales, and after-sales services.

Adrian Johnston is the Senior Vice President of Cloud (SaaS) Applications at Oracle Asia Pacific

Supply chains in the digital age

These companies are disrupting the supply chain to drive innovation. They are doing this by using data to better join up their back- and front-offices, influence product, and service development enable hyper-personalization and drive efficiency.

According to Bain & Co, companies that integrate digital technologies into their supply chain can quickly improve service levels while cutting costs up to 30 percent[4]. Agile supply chain operations are, therefore, critically important to ensuring front-office innovations are a success – but most companies are not yet rebuilding their back-office functions at a fast-enough rate. In fact, according to research from Accenture and HfS, over 50 percent of enterprises say it takes months or even years for their support business functions to make changes in response to evolving business needs[5]. The reasons given for this include siloed internal processes, which approximately 80 percent of organizations cited as barriers preventing them from achieving their business goals.

Successful companies build a short-term roadmap with concrete initiatives that will start delivering benefits quickly and provide flexibility in reaching long-term supply chain goals.

We believe the cloud roadmap, with Software-as-a-Service for supply chain operations as the core, answers. The cloud brings together the disparate data, systems, and partners that comprise supply chains and facilitates their integration across the enterprise. As such, the cloud provides the basis through which back-office operations can be made agile rapidly, and with minimal disruption to the business. When you start adding AI and IoT led business applications to the supply chain operations, this transforms businesses into intelligent enterprise further fuelling innovation and customer experience differentiation.

Act now

Begin by debating questions at your next board meeting - What will business in Asia look like in five years, and what supply chain capabilities you need? Organisations that are leading the way in the adoption of cloud and data technologies are making e-commerce faster and more personalized than ever. Other innovators are using data from manufacturing and post-sales to iteratively improve their services and create additional revenue streams through new business models. The supply chain is a fundamental driver of success in the digital age and all organizations need to act now by looking at how their own supply chain is set up and whether it is still fit for purpose

The Rise of the Autonomous Revolution

Anxiety has been named the modern plague of our time, with much of the ‘angst’ driven by the impact of modern technology - and with the dramatic rise in the adoption of Artificial Intelligence (AI) and automation in business, it feels like this condition has spread to the workplace.  Certainly, the arrival of any new technology that promises to change the way we do things has always created tension in society; think of the introduction of machines during the Industrial Revolution. So how concerned should we, in fact, be about this new development?

Perhaps, if history is anything to go by, less so than we currently are. While new technologies seemed at first to render the traditional workforce obsolete, new jobs and new industry segments were created in the long run. Indeed, productivity-raising technologies – like AI and automation – actually transforms the original job scope of traditional jobs, up-leveling and creating new forms of employment.

The autonomous revolution

Today, we see artificial intelligence, combined with machine learning, automation technologies and massive compute power, leading the way towards the Autonomous Revolution. This sees machines for the first time, increasingly capable of accomplishing activities that were once considered beyond their capabilities, such as making judgments calls, sensing emotion or even driving.

In effect, autonomous is the next level of automation, in that automated solutions still continually need users to intervene and dictate their operations – which itself is labor-intensive. True autonomous solutions can, once powered on, fully operate on their own to make decisions that are not only the most efficient for the user but because of the use of AI, might even suggest a better outcome than humans alone might come up with.

Think of a self-driving car. You key in the destination and allow the car to guide you across the best routes, navigate traffic, get you to your destination, and maneuver a difficult parking - all in time for your next meeting. The car eliminates the need to drive, or even learn driving as a skill, plus the risks associated with human driving errors.

The Philippines and the Autonomous Revolution

So how might the autonomous era impact the Philippines? The country is already known as a Business Process Outsourcing (BPO) market, with this sector being a major employer and key source of income for the nation[1].

However, recently job openings for fresh graduates in the industry have shrunk, with the rise of automation seen as one of the contributing factors[2]. A further estimated 43,000 jobs are also expected to be lost from 2016 to 2022 due to artificial intelligence[3].

Not all is lost though. Similar to how the Industrial Revolution brought about the creation of new jobs, the Autonomous Revolution too requires a new breed of employees. Employers and government officials need to rethink their employee engagement approach – providing employees with the necessary avenues to upskill.

The autonomous enterprise, here to help, not replace

It is also key to note that the technology itself might help the transition, after all, its aim is to augment human skills, and help free them up to do higher value work, not replace.

Imagine what the Autonomous Enterprise could mean for the average BPO employee:

He gets in to work and his emails are already sorted in order of priority with certain miscellaneous emails immediately relegated to the spam folder and some emails answered with a previously registered response. He is able to start the work day fresh, without having to go through a blanket of emails.

A spreadsheet with customers’ details – prioritized based on the last interaction – is highlighted to him, advising him on the next tasks, and recommendations on the approach to take. Instead of manually finding answers to a customer’s query, the BPO employee is able to take a step back, analyze the recommendations shared by the Autonomous Enterprise, answer the customer’s query and follow up with recommendations on next steps. This turns his role from being process oriented to a consultative one.

When a meeting overruns, the Autonomous Enterprise immediately reschedules the next appointment or arranges a quicker ride to ensure the employee gets to the meeting on time. It reminds him of things that he needs to look into, such as peer appraisals and team bonding sessions, pulls out a list of articles on social and traditional media that he might find interesting to mention to the customer and automatically scans the corporate IT system and downloads the latest security patches available.

It means less time on manual tasks that most employees are not interested in, less chance for human error as a result of tiring labor-intensive work and more time for enrichment and collaboration, instead of being concerned on the nuts and bolts of operations. It also means a change of job scope, and an opportunity to upgrade oneself to the next level of the job.

Oracle is the pioneer of Autonomous technologies for the Enterprise. We have introduced capabilities into our Cloud Platform Services that lower operational cost, reduce the risk of human error and accelerate innovation, and get predictive insights. For example, the recently launched Oracle Autonomous Database does not require human intervention for mundane tasks, such as patching, turning and protecting the data from security vulnerabilities.

We are only at the start of the Autonomous Revolution. To capture the full benefits jump on board early.  Start with deployment for some non-mission critical workloads and see how you can rapidly reskilling workers to benefit from it. Policymakers also need to collaborate with the business community to help the employers and employees of tomorrow while they are in transition, enabling them to boost productivity and stay relevant.

Chris Chelliah is the Group Vice President and Chief Architect, Core Technology and Cloud, Oracle Asia Pacific

*This is Press Release