The Supply Chain 4.0
Following the early 2000’s, the digital revolution began impacting nearly every industry across the global marketplace. Over the last decade, it has begun to infiltrate the supply chain space more heavily. The developments in logistics technology and supply chain management have been dubbed the “Supply Chain 4.0.”
In short, Supply Chain 4.0 refers to the systematic integration of innovative software, analytics tools, IoT devices, and other technological solutions into the supply chain management business model.
While there have been several truly dynamic technologies introduced into the supply chain market in recent years, there have also been plenty of products that have missed their mark. As with any market that is scaling rapidly, not all enterprises find their niche and operate effectively in it.
To avoid falling into the latter camp, your organization must assess common industry problems from the perspective of your target audience. By identifying your ICP (Ideal Customer Profile), you can begin to dig into the pains and frustrations felt by the sector(s) of the market you are seeking to help. The go-to-market strategy of any business should then be to innovate and to provide relief and a common solution for the market’s problems.
How Innovative Solutions Are Brought to Market
There are numerous product and technology development strategies that can be utilized to bring a solution to market. In fact, you’ve probably heard numerous endorsements of Lean, Six Sigma, or Agile development strategies on LinkedIn. However, not all these methodologies are effective when applied directly to the supply chain industry.
Companies operating within this sector must manage a dynamic array of factors if they seek to improve organizational efficiencies and enhance profitability. From trade to compliance to procurement to manufacturing, it’s clear that there are nearly limitless areas to focus on when considering how to go about innovating one’s own supply chain.
Using the Jobs-to-Be-Done Theory to Find Effective Solutions
The complex nature of the supply chain space, and the scope of business that it can influence when a disruption occurs, has led many companies to stay “fixed” and hesitant to adopting innovation. In short, change is scary, and change management is difficult. One effective methodology for overcoming the barrier to product adoption is known as the jobs-to-be-done (JTBD) theory.
From a high-level perspective, this strategy involves analyzing what “job” or set of tasks your prospective clients need to perform and then approaching the market with a solution to those problems. All clients — especially those operating in the supply chain space — have very specific tasks that need to be completed to facilitate business continuity, maximize profitability, and ensure their own job security. By shifting your perspective toward being a product-led company, you can efficiently identify client pain points and create a product or service that eliminates those points of friction.
While a supply chain business may not adopt a new technology because it is the latest or most popular product on the market, it is common that these organizations are seeking true, “value-added” solutions that will cut costs, improve performance, and streamline internal processes for them.
While there are many advancements occurring in the space, an emerging technology that has begun to crop up across logistics has come in the form of digital ledgers. This comes as no surprise amid the popularity of blockchain and cryptocurrencies, as digital ledgers can significantly reduce vulnerabilities to acts of fraud, increase organizational transparency, and minimize the burden on administrative personnel.
Many businesses are willing to replace legacy systems with innovative digital ledger solutions because these technologies offer notable benefits over existing processes. Why? Because many people believe them to be faster, to be smarter, and to be safer.
Best Practices for Creating Supply Chain 4.0 Technologies
The JTBD theory is one way to help you lay the foundation for your own go-to-market development strategy. We also recommend leveraging several other best practices when planning and creating a Supply Chain 4.0 solution.
Refine your ICP
An ICP, or Ideal Customer Profile, will serve as the bedrock for all your marketing and commercial efforts. This profile should outline who your audience is, what services they provide, and what barriers are impeding them from profitability or productivity.
Oftentimes, organizations create several ICPs to account for each class of decision-makers they will interact with during a sales process or customer buying journey.
For instance, one ICP may outline key traits and characteristics of a C-suite executive. Another may guide marketing efforts to be directed explicitly at the IT manager or a trade analyst.
Ultimately, identifying the “who” is essential when using methodologies like JTBD, and ensuring they are effective when you go-to-market.
Identify Customer Pain Points
When creating each ICP, you will attempt to view common industry problems from the perspective of whoever your target audience happens to be. This will help you effectively identify their pain points and develop strategies for resolving barriers to success.
In the world of supply chain management, it is vital that you conduct research on several high-profile clients. This allows your team to compile specific-use case data and demonstrate the effectiveness of your product. Often, if done successfully, this will lead to product-market fit and an ability to scale your business as an innovative solution.
Define Your Total Addressable Market
Defining the total addressable market (TAM) is a particularly important practice for emerging companies and startups that are in the pre-development phase. Calculating TAM is essential when forecasting your potential revenue and profit margins.
In addition to calculating TAM, we recommend assessing the market saturation. Is the supply chain industry already filled with somewhat similar products or solutions? Or is the technology that you are developing a unique solution that fills a glaring need within the industry?
Implement Product-Led Growth Strategies
When combined with the JTBD theory, a product-led growth strategy is by far one of the most effective tactics for launching your technology commercially in the supply chain industry.
Put simply, the software itself is at the center of all sales and marketing efforts.
For a product-led growth strategy to be effective, the technology must provide a world-class user experience. This approach operates on the premise that clients will be willing to keep paying for a digital product after one use because the experience was seamless and beneficial.
Most organizations using this strategy offer a no-obligation demo. This offer gives prospective clients the opportunity to interact with their product before making a commitment.
At NYSHEX, we leveraged a combination of strategies when developing our hallmark product. And we started by identifying which tasks our audience (Shippers, Carriers, NVO’s) needed to perform.
In our case, shippers needed to improve contract performance, increase the certainty of landed costs, and access a database for exception resolution. Carriers faced challenges such as booking downfalls and suboptimal vessel utilization.
Once NYSHEX defined our ICP, we developed a product to address our clients’ unique pain points. Specifically, we created technology that facilitates the formation of reliable committed ocean contracts. Not only does this solution result in 99% contract fulfillment, but it also raises landed cost certainty and exception resolution to 100%.
Today, NYSHEX has proudly helped hundreds of supply chain management and logistics organizations and employees to significantly improve their contract performance, reduce costs, and save time.
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