Historic evolution of business focus and supply chain management

Business have changed the way they excel competitor and search for profit through time. Focus has evolved as companies have gained experience and market has changed.

Businesses in the 1960´s

It was believed that higher production drove to higher profits.

Companies competed to gain higher production capacities.

With time, companies understood this statement was false. After all, not everything that was produced was sold, even if scale economies allowed levels of stock, which reduced profit margins.

Businesses in the 1970's

It was believed that higher sales drove higher profits.

Companies competed to gain market share.

With time, companies understood this statement was false. After all, even if you sold most of your stock, production costs remained high because the high levels of waste, which reduced profit margins.

Businesses in the 1980's

It was believed that better processes and quality drove to higher profits.

Companies competed with quality systems.

With time, companies understood this statement was false. After all, no matter how good your process was, or how standard your output was, it didn´t necessarily increased sales (nor profits) because quality was in the eyes of the customer.

Businesses in the 1990's

It was believed that better marketing drove to higher profits.

Companies competed with branding.

With time, companies understood this statement was false. After all, brands could sell but companies service engaged. And while the 4Ps of marketing were a most, you had to go over the limit and excel customer expectations to gain more profits.

Businesses in the 2000's

 It was believed that adding value drove to higher profits.

Companies competed with customer service and for the first time, companies saw the entire supply chain as a value-added flow.

Offering a good customer service was more than just having someone over a phone to answer questions. It was solving supply chain issues.

Adding value to the customer was more than giving more at the same price, but was giving more, something I can afford for the same price.

In order to give more at the same price it was necessary to manage supply chain.

Businesses in 2010´s

E-commerce boom changed everything.

Consumers stop going to the stores and start purchasing on-line. 

If you´re not on-line, you don´t exist.

Companies started to do businesses on-line.

The main challenge of the decade has been to move from a traditional business to an on-line business. Companies that have made the changed have learned that selling on-line is not just having an excellent on-line platform or good securities, but also having a faster, more efficient and leaned supply chain.

The ones that have succeeded in the change to on-line, nowadays are the industry leaders in their markets. 

The ones that have failed, have broken.

Businesses in the 2020's

At the moment of this post, a global quarantine with an average of 3 months' time period, as a result of a highly contagious disease from human to human, has changed everything again.

The only companies that have been able to operate continuously and have increased their profits are the ones who have succeeded in a digital business model, the ones who have leaned their supply chains, and automated their processes, so probably this is going to be trend in the decade to come.

Selling on-line will stop being another selling channel but will become the selling channel.

Supply chains will have to be optimized to compete with lead times, geographical coverages and prices.

Robotic will increase its presence in manufacturing and more processes will be automated to reduce sick people, reduce the risk of contagious and lastly avoid closing operations again.

Do you agree with the probable trend for this next decade? Can you think of another trend for the 2020's? Let me know in the comments.