Social Media In Supply Chain – Good or Bad?

In one of our articles, The State Of Today’s Competitive Supply Chain: Digital, Smaller and More Resilient, we addressed how supply chain in 2017 will see a lot of reaching points in terms of the Internet of Things (IoT). We mentioned that digital technology will present itself as a business initiative by aiding responsiveness and faster execution.

The Robotics and the “New” Supply Chain produced a 2015-2020 report echoed these same sentiments in maintaining that tomorrow’s supply chains will be faster, smaller, cheaper and local. In the report, 70% of the supply chain leaders surveyed revealed that they had no idea and no plans in place to adapt to this new supply chain concept. Besides highlighting how robots will be able to interact and form part of the hard present-day logistics systems, the report also talked about the influence of social media and how it will change the rest of the field. Sharing, engagement, immediacy and transparency have begun to dominate discussions and have sent surges of curiosity through to professionals across all spheres and functions of organizations. Social media is a hub that allows access of information at a rate and volume that has never been experienced before and is set to continue at this level for years to come. Even Adrian Gonzalez, founder and president of Adelante SCM said “social media can – and should – play a central role in supply chain management. After all, social networking is not really about socialising, but about facilitating people to- people communication and collaboration.”

Human beings over centuries have always been inclined to give in to their need of sharing and gaining information. Broadcast mass media in the 1990’s took this on and made it possible to share messages with large audiences across the globe quite easily and quickly. However, this method only benefited corporations who had big budgets and access to creative content creators. The digital age solved this dilemma with ease by taking it a step further, making it possible for anyone with internet connection to access information. The social media revolution eliminated the limitations of traditional mass media and made it possible for everyone to share a message straightaway. This advancement has sped up to the point of struggle for businesses and industries to try keep up.

The Global Commerce initiative compiled a Future Supply Chain report, (available at 2016 Future Supply Chain) outlining a number of issues that needed urgent attention from supply chain professionals and they included integration, collaboration, balancing customer satisfaction and supply chain performance, increased energy prices and e-commerce. The report also advised that “systems of transactions” be changed to “systems of engagement” and predicted that these systems will no longer be available to big companies with big budgets only. It also recommended that the younger generation of supply chain practitioners hold the reigns – a process of change which is hindered by professionals of the older generation who won’t acknowledge and accept the impact of social media on business. The supply chain industry values the skills, knowledge and experience of these professional but also recognizes that their resistance places the whole field at risk. Social media has already started impacting demand planning, sourcing strategies and transportation capacity of existing supply chains, and the impact is likely to increase exponentially.

Customer demands now include simplicity and absolute transparency and social media provides exactly that. It’s not much about social media tools and platforms – it’s broader than that. The benefits of social supply chains include:

Reduced response times

Social data can help alter distribution and it can do this in real time and a low cost. Trends off of social media can assist in adjusting import quantities, delivery schedules and can inform innovation. Hostile weather conditions can be known of ahead of time and communicated before posing a threat to driver and fleet safety or customer satisfaction. Alerts that inform of low stock can also be sent out all at the same time to retailers, manufacturers and distributors.

Manage exceptions and risks faster

Time and cost can both be saved by evaluating financial and operational consequences of any sudden changes in a timely and effective manner. A compromise can also be reached in the same manner because an e-mail sent out to 50 people for example, might take longer to gather feedback and solutions compared to a post sent out to a social network that can return response simultaneously from 50 000 people.

Innovate and improve

Social networking can aid in generating more and better ideas for improving supply chain processes. It can also solve existing problems by obtaining collective insights, knowledge and expertise of employees across all levels of enterprise. Driving innovation in supply chain management can be spurred on the same way product development is driven by “crowdsourcing”.

Measure effectively

Metrics like fill-rate, accuracy and on-time delivery provide information on how well jobs were done but unfortunately do not give a full view on the customer service front. Social media generates this insight and has monitoring tools that can give off data that provides an in on valuable facts which can influence supply chain planning.

Leverage supplier communities

Having control over supplier communities enables improvements to the supply chain and this can also reduce the strenuous effort of research and costs related to development and IT.

Shorten inventory lead times

“The speed of the chain is not really related to the systems used by the various companies – it’s all about people, and people talking to people,” said Tony Martins, the VP of Supply Chain at TEVA Canada. “Traditional command and control structures are outdated. Social media can create a virtual table around which resellers, wholesalers, manufacturers and suppliers can sit at the same time, and work towards fulfilling market needs all at the same time … not in a linear process as is currently the case.”


Do you think social media will change the future of supply chain? Let us know your thoughts.


Source: Logistics News