SMAC in the Middle of Supply Chain Change

Of course the title is a play of the adverb “smack in the middle”, which Merriam-Webster defines as at the heart of the matter.

By SMAC I mean the acronym Cognizant, amongst others, uses for Social, Mobile, Analytics, Cloud. SMAC has the potential to change the manner in which the extended supply/value chain shares data, collaborates in the resolution of issues, and engages in value sharing business processes.

It is about time for supply chain change. We have been talking about removing the silos of supply chain planning for decades. Not just in supply chain planning, but across the entire enterprise. Our traditional approach to a person’s function at work, and the required organization structures to control how people work, is based on the work of Frederick Taylor and others. Taylor and others advocated the concept of Scientific Management and focused on standardization of jobs by breaking each job down into small, repeatable steps. People were then trained to carry out each step in a very repeatable, efficient manner. Great leaps in productivity were achieved in its application.

“the fully developed bureaucratic mechanism compares with other organizations exactly as does the machine compare with the non-mechanical modes of production. Precision, speed, unambiguity, … strict subordination, reduction of friction and of material and personal costs- these are raised to the optimum point in the strictly bureaucratic administration.” - Max Weber (1948): Essays in Sociology

But Scientific Management predates The Knowledge Economy.  And yet we still operate and organize our companies in ways applicable to the Industrial Age, which itself caused huge social and economic readjustment at the time.

The promise of SMAC is that we will be predicting the future (Analytics), the results will be available anywhere (Mobile), everyone will be networked (Social), and at a fraction of the cost (Cloud). Gartner predicts that by 2017, SMAC (which Gartner calls the “Nexus of Forces”) will drive more than 26% of the total enterprise software market revenue, an increase from 12% in 2012 - representing over $104 billion new revenue from this stack. But what will get us to this promised land? I do not believe it will be with the Digital Immigrants who run our corporations now. We will have to wait for the Digital Natives to force their way through the corporate hierarchies. As Jeff DeGraff writes

Digital Natives view the world horizontally, in equalitarian terms. Rather than dividing the world into hierarchies, they see everyone as existing on an equal level. They embrace the benefits of sharing things and ideas with each other and, in doing so, they cross boundaries.

I can’t wait. But this is not how our corporations are run now, including supply chains. And SMAC is right in the middle of the change that is coming. For additional reading on the topic of Digital Natives and Digital Immigrants, check out my recent blog on "Do Supply Chain Planning systems generate any value?" as well as the following presentation by Marc Prensky from the Handheld Learning conference.