Comment: how to lead in a disruptive supply chain world
Disrupt or be disrupted. That is the reality facing businesses and their supply chain organizations in the digital era, where business models change as quickly as new competitors or new market opportunities emerge.
Winning supply chains will be those that aspire to be the best while tackling the real transformational challenges that lie ahead.
Great supply chain leaders have to create a vision for what’s possible in the future amid the realities they face today. They need the ability to anticipate and respond to future events with integrated plans capable of responding to disruptive business scenarios.
That means redefining the notion of a supply chain. Traditional supply chain strategies that focused on incremental change, being risk-averse, and that are measured mostly on cost savings and efficiencies, will no longer win.
There are three key areas that supply chain leaders should focus on to create their vision for the future.
New customer experiences
We are entering the age of “experience” economies. This means that the way companies deliver customer value is different, and the customer experience is the new battlefield for competitive differentiation. The new competitive differentiator is understanding what customers want before they ask for it, sometimes solving problems customers didn’t realize they had.
Customers today are focused on getting what they want when they want it. Creating that superior customer experience can include delivering personalised, or smart products and services, with immediate access and delivery where and when the customer wants them. Or ensuring that corporate social responsibility (CSR) initiatives are built into the supply chain to provide sustainable purpose and products to customers.
These customer experiences will be delivered through disruptive business models called ecosystems fueled by virtual connections that enable companies to come together and deliver the customer experience in ways they couldn’t before.
The new virtual ecosystem
The concept of a business ecosystem is not new. Cars, for example, have evolved to become platforms delivering a customer experience that draws on a cross-industry ecosystem of partners, from the car manufacturer to companies that specialise in communications, entertainment and navigation. What is changing with these ecosystems is the rise of digital connections combined with digital products.
Products and services delivered through the ecosystems of the future are connected by electronic touchpoints called application programming interfaces (APIs). The connection is digital and the product is digital. These virtual ecosystems will disrupt supply chains.
Ecosystems are the future of the digital business world. Every company will compete in a virtual ecosystem. Supply chain leaders need to orchestrate product and solution development across the ecosystem, combining input from players previously unknown to them.
New digital technologies
Underlying and fuelling all of this are new digital capabilities. As supply chains build digital maturity, the use of different types of technology evolves. Businesses and supply chains will be ecosystem-driven, crowdfunded, socially agreed, 3D-printed, drone-inspected, sharing-economy-provided, usage-metered, predictively maintained and blockchain-assured. These new digital capabilities are also catalysing changes to the very notion of what we now mean by the supply chain.
Take artificial intelligence (AI), for example. The rise of AI is enabling a future in which a supply chain will be a dynamic, self-adapting organism to a constantly changing environment, much like the human brain.
The supply chain of the future could look like one in which customers and partners may be machines that are acting and negotiating on their own, with little to no human intervention. This supply chain can digest vast amounts of data, anticipate customer needs, predict when critical suppliers will shut down and then, autonomously and dynamically reconfigure the network to respond, making decisions to qualify and connect, all at the speed of digital.
DHL Express Invests in Electric Cargo Plane Fleet
DHL Express has ordered 12 fully electric cargo planes to supercharge efforts in reducing carbon emissions across its US delivery network.
The Alice eCargo planes are manufactured by Seattle startup Eviation, and are designed specifically to be configured for either cargo or passengers. The first planes are expected to be delivered to DHL Express in 2024.
“We have found the perfect partner with Eviation as they share our purpose, and together we will take off into a new era of sustainable aviation,” said John Pearson, CEO of DHL Express.
The purchase forms part of DHL’s €7bn investment in reducing CO2 emissions by 2030, with a zero emissions target set for 2050.
“We firmly believe in a future with zero-emission logistics,” Pearson added. “On our way to clean logistics operations, the electrification of every transport mode plays a crucial role and will significantly contribute to our overall sustainability goal of zero emissions.”
What is Eviation's Alice Aircraft?
- Manufacturer: Eviation
- Capacity: 1,200kg
- Range: 815km
- Charge time: 30 minutes
- Launching: 2024
Eviation’s Alice aircraft enable cargo and passenger airlines to operate zero-emission fleets. The plane can be flown by one pilot and is capable of carrying 1,200kg, with a maximum range of 815km.
The aircraft can be fully charged in 30 minutes, which can take place while the vehicle is loaded and unloaded between flights. Eviation says that, because the aircraft has fewer moving parts - or points of failure - than traditional aircraft, they are more reliable and reduce maintenance overheads and downtime.
“With Alice’s range and capacity, this is a fantastic sustainable solution for our global network,” said Travis Cobb, EVP Global Network Operations and Aviation for DHL Express. “Our aspiration is to make a substantial contribution in reducing our carbon footprint, and these advancements in fleet and technology will go a long way in achieving further carbon reductions.”
How Does Alice Compare with UPS’ eVTOLs?
DHL Express is not alone in electrifying the skies. In April, UPS announced a new fleet of eVTOL (Vertical Takeoff and Landing) aircraft, from Beta Technologies, which will enter service in 2024.
UPS’ vehicles can carry 635kg with a 400km range and cruising speeds of up to 170mph. The eVTOLs can carry cargo to several short-hops or one long route on a single charge, and are aimed at healthcare organisation, SMEs and businesses in small or remote communities.
“These new aircraft will create operational efficiencies in our business, open possibilities for new services, and serve as a foundation for future solutions to reduce the emissions profile of our air and ground operation,” said Juan Perez, UPS Chief Information and Engineering Officer.
The first 10 eVTOLs will be delivered in 2024, with the option for UPS to order up to 150 more.