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Why Organizations Need A Chief Supply Chain Officer, Despite Key Challenges

By Steve Dowse, Blume Global

What is the most frequently prioritized
function for future digital investment among C-level executives? According to
the Deloitte Industry 4.0 Investment Survey 2018,
62% of respondents said it is the supply chain; it ranks ahead of product
design, marketing and sales. This is not surprising, considering the supply chain
impacts the entire organization — from product design to final delivery to the
end user.

With this in mind, it makes sense that the
retailer Adidas plans to implement large-scale supply chain digitization to
take advantage of real-time supply chain data as it struggles with supply chain shortages. The
goal is to better execute a demand plan based on a reliable forecast.

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Despite the importance of supply chain
operations to a business’s bottom line, supply chain professionals do not
always have the executive-level support necessary to improve overall
performance. In fact, only 22% of the respondents noted that Chief Supply
Chain Officers (CSCO) are highly involved in determining the digital strategy,
or serve as key decision makers in digital technology investments. Although the
role of CSCO is still a relatively new one within the C-suite, it needs to
become a strategic leadership role for organizations worldwide — and fast. 

Supply chains are central to how a company
does business and the experience it delivers to customers. This validates the
call for the CSCO to have a leadership role within organizations. Fortunately,
more and more retailers recognize the importance of this position and have
created a CSCO position to support their global supply chain and logistics
network. This includes retailers such as Macy’s, Target, PVH and Blue Apron.

Even though CSCOs are becoming more visible
and beginning to have a voice at the executive table, they still face
challenges to improve efficiencies, reduce costs, increase revenue growth and
deliver better customer service and experiences. CSCOs that overcome those
challenges will help their companies better meet their customers’ needs.  

The Need For Real-Time Visibility

Siloed parts of the
supply chain, especially in the first- and last-mile freight segments, are
particularly disruptive to a CSCO’s business operations. For example, to travel
from a port to a distribution center, trucks must be available for immediate
pickup and avoid any unexpected traffic to the rail ramp. If not, these ground
transportation delays can result in high accessorial charges that quickly add
up.

With widespread
shortages in warehouse space, containers, chassis, trailers, trucks, truckers,
material handlers and more, CSCOs need to have the ability to convert every
single container into a warehouse and redirect containers as needed in real time.
Utilizing in-transit, real-time and end-to-end visibility, CSCOs can track
their inventories at SKU levels and make precise, informed decisions — ultimately
boosting the efficiency of their supply chains and reducing costs.

Better Data Drives A Better Performance

CSCOs must reinvent
their logistics and fulfillment operations to meet and exceed ever-growing
customers’ expectations in an Amazon-driven retail landscape. If retailers
don’t meet customers’ demands, customers will switch to another retailer for
their purchases — and may never come back. CSCOs need a data-driven platform
that allows them to forecast and respond to demand in real time — turning a
reactive approach to supply chain visibility into a proactive one.

Identifying potential
problems — such as competitors’ promotions and big in-stock seasonality needs —
before they occur with predictive analytics, CSCOs can better understand the
elasticity of demand for their products and respond accordingly.

From A Cost Center To A Revenue Generator

Organizations need
to no longer see their supply chain as a cost center, where CSCOs only help
their organizations minimize costs, lower distribution center inventory and
quickly ship in bulk. Supply chains must become key business enablers that
increase speed to market and drive revenue growth.

Automation and
acceleration of repetitive, manual tasks, including financial settlement,
allows CSCOs and their teams to focus on more strategic, high-value work. With
an automated and adaptive supply chain, teams can put their focus on improving
speed and service across multiple channels with smaller, more frequent
replenishment cycles — to accommodate shorter product lifecycles.

The
CSCO is an important part of the executive management team for retailers. They
must bring efficiencies and cost savings into the fabric of their supply
chains; increase revenue growth through better agility in their supply chain
networks — from visibility to orchestration to settlement — and empower their
supply chain teams to focus on high-value work that transforms customer
experiences. The end result: enhanced operational and
employee efficiency and happier customers.

Steve Dowse, Senior Vice President for Project Management
for
Blume Global,
has over 30 years of IT experience within global transportation and logistics.
He is responsible for product management for Blume Global,
a leader in global logistics and digital supply chain
solutions.

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