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Competition in the supply chains last-mile is intensifying with
each passing month. Yet some suppliers continue to experience
significant business growth amid stiff competition. How do they
do it?
Top firms are winning market share by serving a variety of flex-
ible packaging products, services, and promotional campaign
tactics which in turn, enable their customersbrand ownersto
capitalize on trending consumer demands.
These firms blend innovative, cloud-based, responsive I.T. solu-
tions and stable, on-premise incumbent solutions to achieve
exceptional levels of service. This hybrid approach produces
guaranteed outcomes while executing agile, iterative solutions
to new and complicated problems. By operating in two comple-
mentary modesstable and agilesuccessful last-mile logistics
providers optimize while delivering consistently, and overcome
challenges that confound the competition.
Services provided in the last-mile of supply chain logistics include any/all of the
following:
Work-in-progress management
2 Last-Mile Supply Chain Mastery: Is Your ERP Really Up for the Job?
Mobile & Digital: The Evolving Supply Chain
In the past half-century, the way firms in the businesses core areas of operation and laid
supply chain have managed their resources the groundwork for systems of integrated
and processes has transformed dramatically. modules to manage critical back-end sys-
In the sixties, the invention of the microchip tems of record like financial accounting and
let companies automate inventory control human resources.
for the first time.1 Since then, technology
As the Internet matures, the social, mobile,
has been the primary catalyst driving
and digital environments continue to weave
innovation, from automating production
themselves into everything we do. Just
processes, to collecting and leveraging
think about how much that smartphone in
business intelligence, and ultimately,
your pocket has changed how you com-
interconnecting a global network of supply
municate, connect, and plan your life. Slow,
chain partners.
tedious or limited interactions are now
By the late nineties, one technology dom- quick, easy, and fluid. Social is the new nor-
inated this trend. Enterprise Resource malthe cloud has changed everything.
Planning (ERP) megasuites transformed
MRP
Firms can now leverage
1970s scheduling data to improve
MRPII decision making.
Optimization of entire
manufacturing processes 1980s
becomes a reality. ERP
Stable, system-wide
1990s business process integration
EXTENDED ERP becomes possible.
Core functionalities expand
with module integrations 2000s
and add-ons. POSTMODERN ERP
Agile SaaS specialists
Today integrate with ERPs to
TRUSTED SAAS leverage network data.
NETWORK
A network of trusted SaaS Future
apps deliver agile and
stable data-driven,
real-time operations.
3
Supply chain service providers have always
used technology to drive efficiency, qual- The cloud has ignited a shift in IT,
ity service, and speed into their operations.
demanding that it too become
Yet today, many firms find yesterdays ERP-
socialmore collaborative, inter-
only solutions inadequate to fully support
the velocity, personalization, and agility re- connected, always-on, and available
quired for production in a modern, global in real-time.
market.
4 Last-Mile Supply Chain Mastery: Is Your ERP Really Up for the Job?
Todays brand owners prefer to work with
1 OPERATIONAL AGILITY: last-mile logistics providers invested in digit-
ization, and capable of building profitable,
Onboarding brand customers quickly and resilient partnerships. Suppliers armed with
securely into their networks, providing real- toolkits that increase operational agility,
time inventory and production capacity reliability, collaborative capabilities, and
updates, getting lines up and running with that support continuous iteration, are the
standardized processes, and the ability to ones thriving in the volatile contract pack-
do all this with a greater proliferation of aging services market.
SKUs, regardless of location.
Those that resist investing in agile,
data-driven capabilities fail to secure high
2 SPEED TO MARKET: quality strategic partnerships. Dependence
on traditional tools and yesterdays practi-
In addition to launching greater variety of ces leaves outmoded suppliers unequipped
products and promotions, last-mile logis- for the challenges of todays supply chain
tics providers also need to collaborate with and their organization and industrys evolv-
brands in real-time to reduce cycle times ing needs.
and get products on shelves faster.
Part of this struggle comes from the attempt
to modify traditional ERP-only solutions to
3 RISK MANAGEMENT: accommodate modern supply chain dynam-
ics. The rigidity that made ERPs stable in the
Increased variability introduces uncertainty past is ultimately too unwieldy to keep pace
to fulfillment and plan attainment. Last-mile with last-mile demands that require flexible
logistics providers are expected to mitigate and timely strategic response. ERPs have
hazardous business risk and demonstrate long been supporting business resource
high levels of quality control and reliable management without any allies, but today
traceability. theyre no longer alone.
5
The Last-Mile Logistics Tech Gap & ERP Myth
Monolithic ERP megasuites have been the many specific needs and challenges with
backbone of enterprises business oper- the same focus and power that a specialist,
ations since before the Internet era. In the purpose-built vendor solution can.
pre-digital market, ERPs were used to facili-
Not only that, the costs of implementing and
tate linear business changes that were pre-
maintaining ERPs include both capital and
dictable, accurate, reliable and stable. And
operational expenses. Lump sum capital
for years, this solitary mode of operation
expenditures have a lifetime cost calculation,
was efficient. In fact, it was the only option.
a total cost of ownership, and depreciate
over time. ERPs also incur annual mainten-
ance and service fees, ongoing consulting
Todays suppliers must learn to oper- fees, and often additional fees for upgrades
ate in hybrid reality environments if and added features. As a monthly oper-
they want to discover new frontiers ational expense, SaaS solutions appreciate
of growth and profitability. over time thanks to regular feature updates
and product enhancements. Comparatively,
they are inexpensive, easy to implement,
That means they need business solutions fully supported, and purpose-built to solve
that are agile, responsive and undeterred the kinds of problems that ERPs reactively
by risk or complexity. overextend to accommodate.
Modern single and multi-site last-mile logis- Todays SaaS specialist vendors fill this wid-
tics providers confront vastly different chal- ening operational gap, and relieving the
lenges from enterprises in other verticals. host of associated frustrations left by yes-
A one-size-fits-all resource management terdays ERP-only solutions.
solution cannot sufficiently address their
6 Last-Mile Supply Chain Mastery: Is Your ERP Really Up for the Job?
COMPLEXITY: ERP functionality is comprehensive but generic. This
makes it difficult to onboard brand customers rapidly and makes
configuring and automating bi-directional integrations between brands
and suppliers complex, and clunky.
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Traditional ERPs thrive in Mode 1. They They take nonlinear approaches to busi-
manage linear business challenges in a ness challenges, rely on iteration, agility,
stable, predictable, accurate and reliable and speed to navigate problems that entail
manner (e.g., financial accounting and increased riskand opportunity (e.g., con-
human resource management). Emerging tract packaging, procurement, expedited
specialist SaaS vendors excel at Mode 2. shipping).
MODE 1 MODE 2
Linear challenges,
Nonlinear challenges,
stability,
VALUE iteration, speed, risk
predictability,
friendly
accuracy
CYCLE
Long (months) Short (days, weeks)
TIMES
In a postmodern ERP solution, Mode 1 and pilot project proves successful and stable,
Mode 2 systems work together to facilitate it is validated and scaled out to the whole
a hybrid reality scenario. Once a Mode 2 business and becomes a Mode 1 solution.
8 Last-Mile Supply Chain Mastery: Is Your ERP Really Up for the Job?
Specialized, Responsive, And Domain-Driven
Due to the dynamic nature of assembly, when using ad hoc workarounds (like ever-
kitting, labour and WIP management, last- more complex spreadsheets) to get work
mile logistics providers are losing out on done in ERP-only scenarios.
significant business opportunities by using
Mode 1 challenges are met with a Mode 1
the wrong tool (ERP) to manage challenges
tool, and Mode 2 challenges with a Mode
beyond the scope of its design. Last-mile
2 tool. This agility is how bimodal last-
logistics providers with bimodal capabilities
mile logistics providers are evolving hybrid
that leverage ERP megasuites and domain-
reality operations that dominate in a modern
driven SaaS apps can use the right tool for
supply chain.
the right problem. Bimodal flexibility also
eliminates the risk that end-users introduce
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REINVIGORATED INTERNAL IT: IT teams work the best when they
focus on their core competencies. By outsourcing Mode 2 challenges,
internal IT teams can reclaim their internal capacity to optimize Mode
1 challenges, and collaborate with external Mode 2 specialists eager to
meet their needs.
10 Last-Mile Supply Chain Mastery: Is Your ERP Really Up for the Job?
Sources
1. Liaquat Hossain, Jon David Patrick and Mohammad A. Rashid, The Evolution of
ERP Systems: A Historical Perspective, in Enterpise Resource Planning: Global
Opportunities and Challenges (Hershey, PA: Idea Group Publishing, 2002), 116.
2. Ibid.
3. Gartner, February 25, 2015.2015 Strategic Road Map for Postmodern ERP.
https://www.gartner.com/doc/2992430/-strategic-road-map-postmodern
4. Gartner, April 1, 2016. Hybrid DBMS Cloud Defined, and Why You Want To Know!
https://www.gartner.com/doc/3273417/hybrid-dbms-cloud-defined-want
5. Gartner, January 11, 2016. Transforming ERP to Postmodern ERP Primer for 2016.
https://www.gartner.com/doc/3184718/transforming-erp-postmodern-erp-primer
7. Gartner, February 25, 2015.2015 Strategic Road Map for Postmodern ERP.
https://www.gartner.com/doc/2992430/-strategic-road-map-postmodern
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12 Last-Mile Supply Chain Mastery: Is Your ERP Really Up for the Job?