The COVID-19 pandemic has disrupted global supply chains, leading to a significant transformation regarding how businesses operate—especially brands, retailers, and logistics providers. As supply chain companies navigated through unprecedented challenges, traditional Key Performance Indicators (KPIs) became outdated and ineffective. As a result, COVID-19 forced businesses to look more closely at the metrics and data used to measure success. As updates to core KPIs in the supply chain spurred, so did the emergence of co-opetition as a collaborative strategy to overcome shared obstacles. Additionally, solutions such as collaborative visibility platforms and headless commerce became more prevalent to help e-commerce, direct-to-consumer, and supply chain businesses and their partners. Below we will share how these initiatives continue to bolster supply chain operations moving forward and why they are so important to grow revenue.
The Need for Agile and Resilient KPIs
The pandemic exposed the limitations of traditional KPIs that primarily focused on cost, efficiency, and productivity. The volatile and unpredictable nature of the crisis demanded a shift towards more agile and resilient indicators. Metrics such as supply chain flexibility, responsiveness, and adaptability gained prominence as organizations sought to navigate disruptions and ensure business continuity.
Moreover, COVID-19 reshaped customer demands and behaviors, compelling businesses to reevaluate their KPIs from a customer-centric perspective. More than 58% of consumers said that their customer expectations increased due to the pandemic, because of a rise in omnichannel shopping. In turn, customer satisfaction, delivery reliability, and responsiveness metrics became critical success indicators. Supply chain players had to quickly adapt to meet evolving customer expectations and establish KPIs that reflected the changing landscape.
Co-opetition as a Collaborative Response
The last few years necessitated a paradigm shift in the way competitors interacted with each other. Co-opetition, the collaboration between competing organizations, emerged as a powerful strategy to address common challenges collectively. Competitors joined forces, pooling resources, sharing best practices, and collaborating on innovative solutions. This spirit of co-opetition not only facilitated the update of KPIs but also promoted industry-wide resilience and agility. According to a McKinsey study, companies that effectively collaborated with supply chain partners saw 2x more growth than other businesses.
Competing supply chain technology and service providers are collaborating to address common challenges of customers collectively and forming powerful alliances to solve supply chain chaos.
Co-opetition continues to encourage the adoption of collaborative KPIs that go beyond individual company performance. Supply chain partners that focus on shared KPIs to measure the performance of the entire ecosystem are seeing greater results. Metrics like end-to-end visibility, lead time reduction, and sustainability are crucial as organizations recognize the interdependence and mutual benefits of a well-functioning supply chain network.
Leveraging Data, Technology, Automation, and Risk Management
Current events have emphasized the importance of accurate demand forecasting and adaptability. Supply chains had to rapidly adjust production and distribution plans to meet the surges and declines in demand for various products. Traditional demand forecasting methods fell short, and new KPIs emerged to measure accuracy and responsiveness in predicting and adapting to demand fluctuations. Real-time data analysis, predictive analytics, and scenario planning became critical tools to manage inventory levels, reduce stockouts, and ensure efficient resource allocation. Collaborative visibility platforms, including unified commerce technology, played a vital role in enabling co-opetition, facilitating information sharing, and ensuring seamless coordination among supply chain partners.
Moreover, COVID-19 accelerated the digitization and automation of supply chain processes. With lockdowns, travel restrictions, and social distancing measures in place, manual and paper-based operations became impractical. Supply chains had to quickly adopt technologies such as blockchain, Internet of Things (IoT), artificial intelligence (AI), and robotic process automation (RPA). KPIs shifted to measure the successful implementation and utilization of these digital solutions. Metrics like process efficiency, system integration, and data accuracy gained prominence. Supply chain managers also had to assess the workforce's digital capabilities and invest in upskilling initiatives to ensure the seamless adoption of technology.
As KPIs expand, more and more companies are looking to measure the success of joint risk mitigation strategies and shared investments in contingency planning. This new approach to supply chain management fosters a stronger sense of resilience, mutual support, and a collective commitment to weathering future disruptions.
Creating a Sustainable Future
COVID-19 brought sustainability to the forefront of supply chain priorities, with 19% of top chief supply chain officers more likely to create green initiatives. Collaborative KPIs now include metrics that assess environmental impact, carbon footprint reduction, and responsible sourcing practices. Co-opetition has created opportunities for competitors to collaborate on sustainability initiatives, working towards a shared goal of a more sustainable and responsible supply chain. Competitors in the supply chain space have collaborated to establish and share best practices and sustainability standards. This includes developing guidelines for responsible sourcing, waste reduction, energy efficiency, and carbon footprint reduction. By sharing knowledge and aligning practices, companies can collectively improve their environmental performance and drive industry-wide sustainability improvements.
Furthermore, through co-opetition, companies have collaborated to engage with common suppliers and encourage sustainable practices. This may involve jointly monitoring and auditing suppliers for compliance with environmental standards, promoting responsible sourcing, and supporting supplier capacity-building initiatives to enhance sustainability performance.
Co-opetition has also encouraged collaboration in research and innovation to develop sustainable solutions. Competitors have pooled resources and expertise to conduct joint research projects focused on sustainable technologies, materials, and processes. By sharing the costs and risks associated with research and development, companies can accelerate the adoption of sustainable innovations and drive industry-wide transformation.
Utilizing co-opetition moving forward
Moving beyond the pandemic, supply chains continue to harness the power of co-opetition to navigate challenges and drive innovation. By fostering a collaborative mindset, companies can establish mutually beneficial relationships with their competitors, leveraging shared resources and knowledge to tackle common issues. To utilize co-opetition effectively, supply chains should focus on open communication and information sharing, establishing platforms and networks that facilitate collaboration. Embracing co-opetition allows supply chains to pool their strengths, enhance their collective resilience, and adapt to the ever-evolving business landscape. By nurturing a culture of cooperation and strategic partnerships, supply chains can thrive and create a more interconnected and efficient ecosystem.
The COVID-19 pandemic forced a reevaluation of KPIs in the supply chain, emphasizing the need for agility, resilience, and customer-centricity. The rise of co-opetition as a collaborative strategy has allowed competitors to combine resources, share best practices, and update KPIs to navigate the challenges posed by the crisis. As the industry evolves, embracing collaborative KPIs and co-opetition will pave the way for a more agile, sustainable, and interconnected supply chain ecosystem.
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