Much has been written about the advantage a supplier can achieve by taking the risk and being the first to market for a new product or service.  A recent Harvard Business Review article raised the question as to the value realized by a business and when it is best to contain the exuberance and move with the market.  Their analysis failed to recognize the secondary learnings and development that comes from pushing the organization to be in tune to the market and push the norm.

If we re-arrange the words, first mover advantage which, focuses on the economic gain from introducing a new product or service moves to a focus on the advantages the organization can achieve by learning in making the first move.  The advantage first mover term focuses on the learning rather, than the economic advantage. 

In business where taking risk and pushing the business to be a first mover ensures that your competitors remain on their heels and are forced to respond to your action.  This redirects development efforts and redeploys it to survival efforts, allowing you to innovate and push the market.

Supply Chain Defined

We have accepted the term supply chain to define the collective process of buying, moving, and selling products.  As defined, the process focuses on the activities of managing efforts to buy and sell goods. 

If this term was changed to chain of supply the focus moves from the process of selling to the management of inventory, focused on the vendor.  It ensures we review the pockets of inventory that are used to support pull calls.  It places focus on inventory management and procurement rather, than the distribution and logistics processes.

It is intriguing to recognize that having an efficient supply chain is based on having an efficient chain of supply.  Ensuring there is a seamless and well-organized flow of goods/services from the supplier to the customer is critical to satisfying their needs and delivering on your promise.  Without the right supply process, you will not have the supply levels, one begets the other.

Point of View

I would contend that the recent development in the retail market is not supply chain evolutions but chain of supply evolutions.  We have adjusted our focus to providing access to inventory at all times and getting it to the point of consumption as customers expect.  We have not altered the supply chain, we have altered inventory positioning and the chain of supply.

As you look to compete in today’s marketplace, what is your focus?  Are you minimizing costs in your supply chain or are you better managing your chain of supply and meeting your customers’ needs with your products?  A change in focus may help you gain an advantage of a first mover.

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Scott Moon
Scott Moon