Inside This Issue - Opinion
Supply chain expertise more crucial than ever
June 10th, 2013
The annual ranking of global supply chain leaders compiled by Gartner Inc., an advisory firm that provides technology-related insights to clients in a variety of fields, has been released.
Headed by Apple, the list of the top 25 companies includes just one brick-and-mortar retailer, No. 13 Walmart, whose supply chain prowess has long been recognized as a major competitive advantage.
The company’s supremacy among its peers in that area is, however, no longer a given. Amazon, the Internet merchant whose current robust sales are following a trajectory reminiscent of Walmart’s during the years when it grew to become the world’s largest retailer, finished third in the Gartner ranking. The advisory firm uses a five-part formula to determine a company’s rating, and by two of those measures, "peer opinion" and "Gartner opinion," Amazon was a close second to Apple and No. 1, respectively, in this year’s study. If sustained over time, Amazon’s capabilities point to its continued rise.
The importance of supply chain excellence in a global economy has been amply demonstrated, and Gartner executives assert that it will become even more vital in the future, as companies of all kinds move, in the words of managing vice president Debra Hofman, "from the old ‘push’ model to one that integrates demand, supply and product into a value network that orchestrates a profitable response to ever-shifting changes in demand."
The task for retail chains is more difficult than ever before. Not only do they have to ensure that their stores have the right products in the right quantities at the right time, they have to meet consumers’ increasing insistence on access to shopping options online and via mobile devices. Growing interest in same-day delivery, which is now being tested by Amazon and Walmart, among other companies, adds another layer of complexity.
If the road ahead is challenging for Walmart, Amazon and the other members of the supply chain elite, it is even more daunting for smaller retailers with fewer resources to devote to shoring up their existing distribution system and extending it to the new realities of the emerging omnichannel market. But it’s a job that every company that wants to continue to prosper will have to tackle.