A report issued today by project44, a Chicago-based technology services provider offering standardized, secure Web service API (application programming interfaces) integrations enabling 3PLs and shippers to connect with carriers in real time, takes a deep dive into how the ongoing emergence of on-demand delivery apps, in tandem with an increasing number of same-day delivery options, continues to flip the script on customer expectations and increase delivery’s profile within the customer experience.
The report, entitled “Aligning the Supply Chain In The Age Of The Delivery Economy,” was based on a blind survey of 300 supply chain professionals to more closely examine how the Delivery Economy is impacting the supply chain and what organizations need to do to remain relevant with evolving customer demands. This report is a follow-up to an August 2019 report, which explored customers’ expectations for shipping.
“We find it very telling that consumers give the same weight to delivery as they do to the price of a product in their customer experience,” said Jett McCandless, Founder and CEO at project44, in a statement. “With the rapidly growing use of on-demand delivery apps and same-day delivery services, customers aren’t just buying a product, they’re buying an entire experience. The Delivery Economy is here to stay, and will continue to have a vast influence on B2C and B2B expectations in the short- and long-term.”
One of the report’s key findings focused on the disconnect between supply chain managers and executives, with 82% of managers noting they are experiencing pressure to improve and expand their capabilities as a result of the Delivery Economy, with 57% of executives saying they feel the same urgency to offer precise, affordable, fast and transparent delivery experiences.
This finding according to Tommy Barnes, project44 president, speaks to how too often executives are insulated from on the ground realities and don’t see the day-to-day pressures that managers are faced with, coupled with how, in some cases, managers might not be communicating the challenges they are facing to executives, wanting to put the best face on a bad situation.
“This is why it is so important to foster collaboration between supply chain and marketing teams, executives and managers, and internal stakeholders and external partners on how to meet growing customer demand for better delivery experiences,” he said. “Only through honest, transparent communications on the complex challenges they face will firms be able to meet rising customer expectations in today’s Delivery Economy.”
As for how project44 fits into this equation, Barnes said that transparent communication is actually one of the core benefits of the project44 Advanced Visibility Platform. With all stakeholders able to easily access and analyze the same high-fidelity, real-time supply chain data, they can better collaborate to identify and fix any issues that prevent them from offering an exceptional customer delivery experience, he noted.
When asked what needs to happen to get operating professionals to shift away from outdated processes, Barnes explained that teams need to “bite the bullet” and retire some of these legacy processes and systems, adding that if they can’t improve them with technological advancements and if they do not provide real-time transportation visibility, they need to let these processes and technologies go.
“This transformation won’t come without growing pains – it will require the adoption of better processes and technology combined with collaboration both internally and with external supply chain partners,” he said. “Specifically, managers and executives need to work together now to determine what process updates and new technology they need to meet the demands of the Delivery Economy, before they continue to fall behind and jeopardize relationships with customers.”
These processes, he said, include the need to start updating processes and investing in the solutions that will deliver managers and executives the real-time insights and collaboration required to meet these demands, as demand for low-cost, fast and highly transparent delivery will only continue to grow.
“Companies that don’t prioritize this transformation in today’s Delivery Economy risk seeing customer satisfaction dip, competitors grabbing their market share, and ultimately the erosion of shareholder value,” Barnes stated.
Addressing the increased specific types of pressures B2B organizations are facing that are different from the B2C side, Barnes said that the issue is less that B2B organizations are facing different pressures, and more that B2B organizations are increasingly facing similar delivery experience pressures as B2C organizations.
“Of course, what consumer and business customers want in a delivery experience differs depending on the industry and the product being delivered,” he said. “The specific challenges involved in delivering fresh food to a suburban home are much different than the challenges involved in delivering raw materials to factory. But the overall challenge for B2B and B2C organizations is the same – shifting customer delivery expectations, and how to meet these changing expectations.”
The report also found that 25% of companies have plans to begin offering a subscription fee for faster shipping.
When asked if, and by how much, this percentage could grow, Barnes said it is hard to predict if this particular delivery model–subscription fees for faster shipping-will grow.
“There are a lot of different ways to deliver an exceptional delivery experience,” he said. “What we can predict is that customer demand for better delivery experiences will intensify. That is why it is imperative for companies to improve collaboration between departments and stakeholders on how to improve their supply chain processes and technologies. If they don’t, these companies will soon find themselves unable to keep up with growing customer delivery expectations.”
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