From an inside-out to an outside-in perspective

Risk of over-reliance on current business models

Where can we find the new technologies and business models that are going to dominate our market? That’s the question many companies are asking themselves now that new disruptions are emerging in ever-quicker succession. Many organizations aren’t satisfied with simply keeping their eyes peeled. They are taking on new teams or creating new roles, all with one aim: to be quick to spot and capitalize on new developments.

By Marcel te Lindert

What if Amazon were to start selling French fries? That’s just one of many future scenarios that potato-products manufacturer Lamb Weston/Meijer (LWM) has considered in recent months.

The idea of the USA’s biggest webshop selling fries may not seem particularly logical, but on the other hand Amazon already sells fresh fruit, vegetables and ready meals in ten major cities in the USA. Whoever would have expected that when it started out as an online bookseller 20 years ago? “That’s exactly the pitfall we want to avoid. If we only think logically, we’ll keep thinking from the inside out and we’ll only end up improving our current business models. But if we think in terms of possibilities that extend beyond those business models, that’s when we’ll achieve a real outside-in perspective,” says Ton Maltha, Manager of LWM’s Supply Chain Center of Excellence.

The idea of a transition from an insideout to an outside-in perspective is becoming increasingly common. Companies that are too inwardly focused are blind to the developments that will shape the future market. And even if companies are more outwardly looking, their gaze rarely extends beyond their own market. They keep a close watch on their competitors, but real disruption comes from further afield – from new technologies and business models that emerge and grow in completely different markets. If you haven’t seen those developments coming, it’s too late to jump on board when the runaway train hurtles into your own market.

From fork to farm

That shift in perspective, from inside out to outside in, is the biggest step that LWM has taken in recent years. “Three years ago, our supply chain department regarded the organization as a company that had something to sell. Nowadays we see ourselves as a company that wants to contribute to our customers’ success. Or to put it another way – we used to think in terms of from ‘farm to fork’, but it’s now from ‘fork to farm’.”

The French fries manufacturer has five plants in Europe and the sixth is currently being built as a joint venture in Russia. It systematically thinks about the global developments in the coming years and how they will impact on its supply chain. Which opportunities and threats will they create? The company is focusing on the year 2025. “That seems a long way off, but if we want to be finished by then we already need to have made considerable progress by 2020,” explains Maltha.

This is the first time that LWM has looked so far ahead from a supply chain perspective. “What makes this approach so unusual is its multidisciplinary nature. We’re looking at it from every conceivable angle, from business development right through to potato storage. In the past everyone looked at the future developments in their own field, but this is the first time we’ve done it together in this setting – and it works,” says Maltha.

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Read the full article in Supply Chain Movement 24 | Q1 – 2017

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