In today’s social media-driven world, consumer opinions and demands can shift overnight. A seemingly ordinary item can become part of the next hottest trend as soon as an Instagram influencer, YouTuber or other social media celebrity posts a photo or video about the item.
This creates a challenging business environment for the overall consumer goods industry. Item manufacturers must be agile enough to almost instantly change their designs and production plans. This also means having nimble suppliers who can quickly provide needed materials or inventory as well as flexible distributors who can increase deliveries or delivery speed to move new products to customers.
One industry that seems to have a handle on this speedy supply chain changeover strategy is the fast-fashion industry. Clothing brands such as Zara have figured out how to cultivate well-rounded teams of designers and patternmakers, a reliable global supplier network, and the right information to tap into consumers’ current and future desires. This enables Zara to release new products as often as twice a week and move products from the design phase to store shelves in about three weeks.
Zara’s supply chain speed has made its parent company, Arteixo, Spain-based Inditex, one of the largest fashion retailers in the world. Undoubtedly, one of the keys to its success has been its willingness to embrace technology to improve its supply chain operations. Just-Style, a research and news outlet targeting the apparel and textile industry, outlines four stages in the digital transformation of fast-fashion supply chains, starting from basic technology implementation with siloed operations and data and growing to total embracement of digital technologies to analyze data, automate decisions and better predict future trends. The more mature stages of this scale involve more technology implementation but deliver the most benefits to supply chains.
Roit Kathiala, the article’s author, goes on to describe how digitized supply chains can help fast-fashion companies meet their speed, quality and sustainability goals. Digital technologies will enable better planning, forecasting, logistics, distribution center planning and shipment efficiencies and support improved supplier-customer relationships. Furthermore, better analysis of consumer insights, improved resource allocation, and more eco-friendly manufacturing and shipping methods will help companies meet consumers’ quality and sustainability expectations.
Going digital
These supply chain trends in the fast-fashion industry will soon be a reality for supply chains across all industries. Consumers are expecting better-quality products faster while balancing corporate social responsibility factors. The answer to this challenge will be digital supply networks, which are interconnected, more open versions of traditionally linear supply chains.
ASCM delivers the tools your organization needs to establish and grow its digital supply network. In partnership with Deloitte Consulting LLP, we have released the Digital Capabilities Model for Supply Networks (DCM), which is designed to help users understand the complexity of digital supply networks and assess an organization’s process maturity. The model also is closely tied to the Supply Chain Operations Reference (SCOR) Digital Standard in order to help companies immediately apply the new model without restructuring their processes, metrics or practices.
According to my colleague Chris Richard, principal, high-tech sector lead for supply chain and network operations at Deloitte, DCM users will be able to stay ahead of changing business needs and respond more quickly and with greater agility. Furthermore, the DCM will continuously coevolve with users and the industry trends that affect them to continue to keep organizations ahead of the curve.
To learn more about the DCM and assess your organization’s digital readiness, visit dcm.ascm.org.
