Marketing strategy and supply chain strategy in an uncertain global environment

July 13, 2016
Neil Moon
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marketing strategy and supply chain

When researching and reading papers for customer marketing strategy and supply chain strategy it appeared odd that the two are so different in their paradigms.

Supply chain strategy seems so complicated in that it is a constant tension between customer service and price. Complexity and uncertainty seem to reduce clarity and visibility requiring supply chain managers to make judgemental decisions. Differences in environment and culture of individuals and companies along the supply chain cause inconsistencies that must be reduced through improved communication and planning. Lean and agile supply chains manage dynamic push and pull.

It seems to sum up my entire experience of supply chain management as a constant battle against the elements.
However just recently I had the opportunity to work with a client and go back to my marketing roots. I quickly returned to the marketing mantra that there are only three sustainable customer strategies; operational excellence, customer intimacy, or product leadership. By comparison the marketing paradigm seems so simple and stripped back and yet has stood the test of time. (It’s been over 20 years since I was taught the basics of marketing strategy).
So is there something we can extract from sustainable customer marketing and translate to the world of supply chain management? As perceived wisdom is that supply chain management must be closely aligned to business strategy then I would think so.

So on closer analysis, operational excellence seemed to correlate with the drive for lean supply chains, focusing on removing waste and having simple efficient processes. This is an effective supply chain strategy, but has recently become more challenging when trying to risk manage global uncertainty. Similarly, operational excellence is an increasingly challenging strategy as consumers become savvier and the internet allows direct comparison of basic product offerings. Customer intimacy requires much greater flexibility driven by customer needs thus suggesting an agile pull driven supply chain strategy. Lastly, product leadership also requires flexibility to accommodate the changing demands of new products and services; it appears to correlate with an agile push supply chain strategy. Just as effective is modern customer marketing – a blend of customer intimacy and product leadership so a balance of push and pull in an agile strategy appears to be the modern solution to most supply chains.

At first sight there does seem to be some consistency between sustainable customer strategies and their supply chains. I certainly think it worth exploring further how the three marketing archetypes and their derived philosophies may lead to three matching supply chain strategies. And when one of these three supply chain strategies is applied consistently across all the companies and individuals in today’s global supply chains it may make it easier to ensure consistency of approach. This would certainly go some way to helping supply chain managers make more effective judgemental decisions when faced with complexity and uncertainty.

Will we ever get to only three sustainable supply chain strategies?

Since supply chain professionals spend their careers fighting against silo mentalities, had we better look at our own approach to strategy and realise that there may be a great deal to learn from others and apply in our environment?