Supply Chain Realigns for Global, IoT & Consumer Shifts

| March 10, 2016 | 0 Comments
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There’s always something to be said about the impact of IoT, at least as long as we are still on the prognosticating side of the growth curve.

One point that mollifies the otherwise rousing excitement for what IoT will mean as a driver for growth is the demand for many low cost components. Granted, volume could be a force to reinvigorate the electronics supply chain after 2015’s disappointments, but is volume alone enough and how do we contend with high-volume lost-cost demand along the still consolidating global supply chain? Furthermore, what are critical supply chain capabilities to support the cross-market growth of IoT and the follow-on ubiquitous computing needed to support the interconnection of devices and experiences?

The theme of holistic experiences is one that immediately percolates when exploring the push and pull drivers of IoT. For the semiconductor and electronics supply chain, we note the still continuing rise of mergers & acquisitions (M&A), consolidations, and expanding collaborative partnerships (as well as coopetition). This is not a non sequitur, rather, part of a macro-level set of shifts working through various levels of the global economy: a single-point entry to multiplex services that comprise the IoT experience, whether from a consumer or enterprise vantage. What does that mean though? More simply put, consolidation and single-point vendors have risen as the solution for the hyper-globalized, hyper-abundance of choices, regardless of what is being sought.

Electronics sourcing sits at the intercept of all that is transpiring in the markets today; whether the internal management shifts favoring collaborative and federated solution designs leveraging partnerships or the expectations of end-device users for elegant service solutions that are intuitive, singly packaged yet meet an array of use-case scenarios and user experiences. Solution designing the sourcing of electronic components today and for tomorrow is truly no different than solution designing the next IoT device itself: agility, simplicity, and end-to-end single point solutions are the expectation. IoT is not just a growth wave for products and components, but it is also a supply chain, read business philosophy, that demands the interconnection of partnerships, vendors, etc., in order to provide customized solutions for customers. Add to this demand mindset the impact of rising low-cost high-volume components and real challenges emerge for how to provide the best B2B experience with the selection, responsiveness, pricing, and inventory breadth and depth.

Enter the increasing growth being experienced by electronic marketplaces; the digital economy’s answer to secure, vetted cooperatives with the full transparency, authenticity, global reach, and selection one expects. The fact that market leader Arrow Electronics Inc. invested in and directly supports Verical, a leading electronics component marketplace, underscores the vantage these leaders have on the transforming global business arena.

Verical’s success and strategic advantage is the ability to provide exactly what is demanded today in business and expected as given modus operandi by millennial managers: a single-point, authorized source to access rapidly shifting product needs with secured and traceable inventory with full price and vendor transparency so that orders can be confidently executed and immediately filled. To be sure, the idea of this type of electronic sourcing is not new, but the execution of this idea as an agile, responsive, and integrated digital platform is new.

IoT growth is not just a dilemma of “Things” and services being connected for the benefit of people and businesses, but it is the ability to interconnect global supply chains writ large and maintain supply-demand balances at a global level. IoT is truly the expression of ubiquitous computing as envisioned decades ago, but the actualization of ubiquitous computing entails an end-to-end connectivity for b2b, b2c, and c2c; at the b2b level, the ability for businesses to engage in IoT for sourcing represents one of the critical enactments of digital business processes that will promote growth and simplify ever-challenging global sourcing requirements for the semiconductor and electronics industry.

 

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Category: Featured Blogs, News Analysis

About the Author ()

Lisa Ann Cairns, Ph.D., Contributor Lisa comes to EPS with a diverse background that includes 10 years of hands-on experience in IT as well as in semiconductor and electronics distribution. The majority of that time, Lisa spent in the role of Senior Market Analyst and Senior Contributor at a leading, independent distributor of semiconductor and electronics. Prior to that tenure, she was a professor of linguistic anthropology, engaged in social science research, modeling, and analysis. The skills of observing and explaining complex social patterns adds a rich framework in which to indentify and to understand the range variables that constantly affect today’s globalized marketplace. Lisa’s admixture of experiences brings a fresh eye and a contextualized understanding of the global semiconductor and electronics supply chain. Lisa’s market analyses provides readers with unique views spanning micro- to macro-level industry events, synthesized insights bridging business and economics, as well as connecting the dots between upstream to downstream industry events that affect and inform distribution strategies. Lisa has a Ph.D. and A.M. in Linguistics from The University of Chicago, during which time she was awarded the prestigious National Science Foundation Doctoral Dissertation Research Improvement Grant. She holds a B.A. from Hofstra University, where she was Hofstra's first woman undergraduate to be awarded a Fulbright-Hayes Grant for independent research prior to attending graduate school. Lisa is currently consulting and freelance writing and can be reached at lcairns@lcairnssolutions.com.

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