Yet another buzzword: “Bimodal Supply Chain.” Find out why this one might matter and five ways to embrace it in your supply chain operations.
First, what is “bimodal”?
Gartner defines “bimodal” as “the practice of managing two separate but coherent styles of work: one focused on predictability (Mode 1); the other on exploration (Mode 2).”
In project management, it means running two (or more) modes of execution to get projects done. It’s a departure from fitting every initiative into the same Gantt chart or methodology, and instead encourages businesses to evolve execution methods to fit today’s projects, which are inherently iterative and collaborative—especially in IT.
For the supply chain, the definition of “bimodal” is parallel to project management. Mode 1 in the supply chain pertains to operations that manage the known disruptions—seasonality or updating WMS systems. Mode 1 is for managing well-understood and predictable occurrences and strategizing around them.
Mode 2 in the supply chain is focused on exploring and experimenting new solutions that address and solve areas of uncertainty, such as solving for unexpected inventory swings and mistakes in product forecasts, weather and climate conditions, testing new markets, or the boss wanting to test drone delivery. For today’s market, strategies for solving the unexpected or adapting to new technologies are paramount.
Mode 2 operations are inherently experimental and have outcomes that are harder to predict. They require smaller, more collaborative teams, outside influencers or solutions, and a fail-fast attitude to see if they work.
To run a bimodal supply chain, the room to innovate or test new solutions is a direct result of optimizing Mode 1 operations. It also relies on having clear strategic objectives in mind for the business—testing new solutions for transportation; growing into X new markets; being more competitive in logistics by offering one- or two-day shipping.
But for many businesses, success and strategic vision tie back to customer satisfaction and retention. There is no supply without demand. In supply chains, the bimodal strategy is a powerful tool for addressing the widening divide between what supply chains provide and what businesses need to meet customer demands.
Before you implement a bimodal supply chain strategy, it’s important to keep a few things in mind.
Growing pains are hard, new business models help
For many, a bimodal approach is going to be new and uncomfortable. But surviving in today’s market requires a level of risk-taking. Truthfully, a bimodal supply chain is about taking calculated risks. Finding new technologies and solutions in the market that map to your strategic goals and can impact your bottom line isn’t as risky as shooting in the dark.
Establish what process improvements and innovations will augment your go-to-market strategy and find partners to help you achieve those goals. Especially true in technology is the fact that nothing’s permanent. Most services are subscription-based or a pay-as-you-go model, creating very low impact to your business if an endeavor falls flat on its face.
Metrics may vary
Mode 2 methodologies should be used to uncover new solutions and add a layer of flexibility to your supply chain. To that end, traditional metrics used to measure success won’t always apply.
Mode 2 is about experimenting with new techniques and then scaling successful efforts to increase business agility. But Mode 2 is about discovering what’s going to work. Measuring only specific components of short-term pilots that align with your current metrics for success disregards the pilot as a whole. Instead, providing ongoing communication of small, but continuous, success will demonstrate whether a new tactic is going to work and scale to support your business.
Open mindsets to new minds
For years, the supply chain has been rewarded for consistency and for adhering to all the principles we learned from lean manufacturing. But, the supply chain industry is changing. New talent gets hired every day, and with them comes a new perspective.
The newest generation in the workforce, Millennials, is disruptive. They’re pushy, eager, data-driven, and they want answers outside of “we’ve always done it that way.”
The supply chain is so relevant to today’s commerce and buying behaviors that it’s hard not to find it exciting. Millennials are not only entering the market at a breakneck speed, they’re also perfect for executing exploratory, Mode 2 initiatives in the supply chain.
Leverage this new, fresh mindset and listen to new ideas. See how they compliment your current workforce to find new solutions to solve your business challenges. Not every single one will stick, but it’s sometimes impossible to tell who will have the next brilliant idea.
Look for like-minded partners
The point of bimodal isn’t to invest heavily in an idea up front. It’s about experimenting with ideas. For many of today’s vanguard businesses, success has as much to do with the idea as it does with who’s a part of it.
Instead of building every innovative improvement in-house, look outside to other experts and explore market options before heading in one direction over the other.
Leverage the right technology
Building on the previous point, there are myriad technologies available that enable supply chain organizations to test new ideas before implementing. Take LLamasoft, for example, and its supply chain design technology.
Using a technology like LLamasoft, supply chains can leverage design models to determine what decisions will have the highest impact for the lowest cost. From determining your distribution network to designing your transportation strategy, supply chain design makes it easier to manage inevitable market changes and save costs while doing it.
A real-world example of bimodal
Gartner recently released the report, “For Supply Chain Executives: The Bimodal Challenge.” In the report, Gartner mentions FLEXE as a real-world solution for the bimodal supply chain.
With the FLEXE network, retailers, brands, and manufacturers can find on-demand warehousing and fulfillment services using our marketplace. With access to more than 500 warehouse partners, our customers can run Mode 2 operations like popping up new fulfillment centers or testing new markets with virtually no risk.
The way it works is simple, it’s a pay-as-you-go model, and there are no long-term lease commitments or broker fees involved. It’s the first marketplace of its kind and offers businesses a way to get product closer to customers with investing in fixed assets. The result is a dynamic distribution center that lowers shipping costs and times, speeds up delivery, and maintains your brand promise to customers.
Whether you call it “bimodal” or not doesn’t matter. But the supply chain is in the midst of a transformation that can’t be ignored. As eCommerce and mCommerce increase in market share, your supply chain and distribution strategy will have to become as dynamic and flexible as today’s buying options are.
For many companies, success will always come down to keeping customers happy. Today, much of that comes down to how the supply chain and logistics operate. Finding new solutions to expand your distribution and fulfillment network, improve supply chain planning, and increase the speed of logistics could be the difference between you and the other guy that chose to ignore all the signs.