Changing Face of Supply Chains: Where Next?

The 20^th century started with the industrial revolution and then the world plunged into WWI. That was quickly followed by the great depression in the US, WWII, and then a long cold-war era between the two superpowers and with large part of the world under communism. Then towards the end of the century, things started to look up: The Soviet Union was dissolved, China introduced its market-based economic and social initiatives, India’s markets started opening up, and suddenly the world was a very different place. The effect on supply chains was profound. As the world stabilized politically, the risk of doing business diminished, and corporations were suddenly able to contemplate commerce without boundaries. The free trade agreements further facilitated the process and we saw supply chains extended across the globe. The picture below captures that image of global supply chains powerfully.

The Cost of 0.1 Seconds

April 23rd edition of Forbes focuses on Amazon and its boss Jeff Bezos. Amazon started in 1994 and since then, has defined what it takes to be the largest online retailer. The secret? It is always day one for the Internet at Amazon! From Forbes, “Amazon has metrics showing that a 0.1 second delay in page rendering can translate into a drop of 1% drop in customer activity.” What can that 1% drop in customer activity do to revenues? Assuming a 10% conversion rate (assuming most customers at Amazon are repeat and not just exploring the site), it translates into 48 million dollars!