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Being Unique with MCC: Can Something Buried Under The Hood Be A Differentiator?

Earlier this week, I was in a dinner meeting with the VP of e-commerce at a large general merchandise retailer along with some others from his management team. This was an all-hands meeting of vendor managers whose teams are helping the retailer string together a viable online retail channel. During the course of the dinner, I and another collegue got to spend a surprisingly uninterrupted 20-or-so minutes with the VP (considering the clamour there, it certainly was surprising and may be it helped that none of us were smoking!). Among various things we discussed, one comment he made caught my ear. He felt that in the entire supply chain transformation that's being conceived, differentiation can only be realized via the e-commerce front-end application. Rest of it, order management included, are just supposed to fulfill pre-ordained roles in a predictable fashion.

Now, I had to think dispassionately here and hold myself from behaving like a proud papa whose star son was being given the cold shoulder by the school principal. So, I tried telling him that he's looking at this entire program as "enabling online fulfillment thru dedicated warehouses" (read: ONE order entry channel and ONE order fulfillment channel) and not as a foundation for taking the retailer to the Multi-Channel Commerce way. His counterpoint could be summarized thus "well, Sterling Commerce OMS can handle it, other retailers have done it, at least in parts, so where's the differentiation?"

Now, I could have swallowed it if he had used the term "innovation" or even "customer experience", rather than "differentiation" to describe the fact that others have done it in parts. Just knowing all the options available - say, five kinds of order entry channels to be matched to six kinds of fulfillment methods in all possible ways of order/order-line splits and combination fulfillment  options - doesn't make something a non-differentiator. Why? because most folks today are only giving lip service to cross-channel strategies or are somewhere in the early miles into this long, torturous marathon of enlightened multi-channel order management/fulfillment due to the sheer complexity of actually doing it.

I didn't belabor the point looking at the obvious convictions of the other party; it would have been a limiting argument anyway, considering I was there to cement a relationship, not wreck it :-). That said, my PoV is that companies attemping even a wee-bit of MCC and actually getting it on the road stands to benefit big time. One of the fashion retailers in US who went live recently just tweaked a little bit of their fulfillment philosophy - exposing store inventories for online sales. The resultant spurt in sales the week after go-live when the system hadn't even stabilized resulted in massive doses of shock and awe, albeit of the happy variety. It also gave spurt to a parallel, ongoing program to enable store-to-store fulfillment.

Knowing all options on the table never makes for differentiation, implementing most of it definitely would help differentiate. For sure, it may not give immediate consumer pull like website checkout design or shopping cart performance. That said, if you can create a system that would fulfill customer orders, come what may, through any or all channels possible, word would definitely go around. Accurate fulfillment, timely fulfillment, increased fulfillment percentages all are back-end metrics that would never work to grab eyeballs, but if you aim to keep them coming back, that's where you'll want to throw some senior management bandwidth on.


Well, a car does not sell only because of how it looks. yes, people start looking if its well designed. But whats under the hood drives true customer satisfaction and resell value. You can have the most well designed site in the world, but if your inventory is messed up, bye bye customers...

I found the post thought provking keeping in mind the MCC factor. Though am a supply chain novice, I can't help but think of MCC. Isn't it relevant in its cousins -ERP and CRM too?

Well,my question is "would too much of tinkering around under the hood" bust the car? Every business being unique and every process in every sector of a space different, will a cap on the number of MCC's make a difference? Less is more?

To differentiate should we use technology as an enabler to reduce the process time, or operational costs? So, maybe if the client management sees some innvoation using technology, then automatically the vendor side management should take notice. My 2c on a well captured thought.

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