‘Companies need to be bi-modal’

In order to be successful nowadays, companies must combine an efficient mode with an agile mode. That was the overarching message from research and advisory company Gartner during its supply chain conference in London in September. In the agile mode, it is essential to generate and utilise data intelligently, according to both a successful rugby coach and a professional poker player during the event.

By Martijn Lofvers

In consultancy firm Gartner’s view, companies need a bimodal strategy in today’s rapidly changing world. “Mode 1 is the traditional approach with a lean and efficient supply chain,” stated Tom Enright from Gartner during the company’s supply chain conference in London in mid-September. “Mode 2 revolves around innovative, agile strategies such as the 3D printing of spare parts, for example, and the use of intelligent robots. For many companies, e-commerce has long been a Mode 1 activity.” Enright provided several innovative examples of Mode 2 in practice: Burberry selling its new collection straight from the catwalk online only during the London Fashion Week, Under Armour producing sports shoes with built-in sensors, and Adidas supplying tailor-made 3D-printed shoes for consumers based on them running briefly on a treadmill fitted with sensors in the store. “The algorithms that utilise data and determine the next steps are the most valuable for companies,” Enright explained.

Talent alone is not enough

“In Mode 2, when it comes to data analysis companies have the mindset of a start-up,” said Enright, meaning that companies compete to attract the necessary talent. According to Gartner, organisations require separate teams that seek innovative ways to make the necessary adaptations to the changing landscape.

“Talent alone is not enough,” claimed Sir Clive Woodward, who as Head Coach led England to its first-ever Rugby World Cup win in 2003. “Great teams are made of great individuals. You need to help talented people evolve from students into warriors and ultimately into champions. Some people can’t be coached because they’re ‘know-it-alls’. The real champions are the ‘sponges’ who are curious to absorb all the available information. We used Prozone software that utilises the cameras in the stadium to visualise how all the players in our team as well as the opponent’s team moved around during the match. That data completely blew away the mystique surrounding the New Zealand All Blacks and the South African Springboks. During the tournament, the rugby players analysed their own performance on the laptop. Sharing knowledge turned them into champions. Nowadays, players have a chip in their neck to generate real-time data.”

Woodward also revealed how to select talent: “Winners perform best when under pressure. That’s why I used the phrase ‘T-CUP’: Thinking Correctly Under Pressure. Performing under pressure can be learnt through coaching. It’s about how people have experienced pressure in the past and thinking in advance about what could happen.”

Mode 2 revolves around taking calculated risks, explained former professional poker player Caspar Berry during the Gartner conference. To prepare for his poker games in Las Vegas, Berry used software containing data about all his opponents in order to gain an edge.

Rapid response to changes

Neil Humphrey, Executive Vice President Supply Chain at Unilever, talked about how the supply chain organisation has become pivotal in the turnaround of Unilever’s declining business in Europe. “We’ve shifted the supply chain focus from costs to margin. Our supply chain professionals are business leaders who are helping to achieve growth. For example, we developed an internal webshop for our marketing specialists in which they can put all the existing products in a basket to offer them to their region. That ensures smart clustering at regional level.”

The most important result of this whole approach has been a rapid response to changes in the market and in consumer behaviour. Humphrey: “A faster response is more important than an improvement in quality and service.”