Supply Chain is in the UI/UX Dark Ages
When an executive at Blockbuster approached the CEO about a partnership with Netflix in 2000, the CEO scoffed that Netflix was and always would be a:
“very small niche business”
When Airbnb pitched to Union Square, they were knocked back on account of a fundamental belief that the idea wasn’t fulfilling a customer’s need:
“We couldn’t wrap our heads around air mattresses on the living room floors as the next hotel room and did not chase the deal.”
When Uber was first marketed, few could imagine that people would ever want to ride around in a stranger’s car.
What is going on in each of these examples?
"By definition, one’s map of salience represents an interpretation of what will be important moving forward."
At Netflix, Reed Hastings had a map of salience around the future of entertainment distribution that was, ultimately, a mismatch for Blockbuster’s CEO.
By definition, one’s map of salience represents an interpretation of what will be important moving forward. This is the lens I want to hold up in this article.
Union Square’s map of salience of the travel industry was a mismatch for Chesky and his team at Airbnb.
Travis Kalanik had an earned secret. It told him latent time plus latent equipment meant ordinary people could deliver affordable rides with their vehicles in cities all over the world.
In each of these examples a big, potentially game-changing opportunity is being missed. This can’t be overstated enough.
"To founders and brands that have little experience in manufacturing, the hurdle of horrendous customer experience is often crippling."
I believe that we, at Atelier, are at the vanguard of an opportunity. A similar mis-match has crystallised. Our thesis: brands that make goods care about the user experience of manufacturing. The prevailing thought among manufacturers of Consumer Packaged Goods is that all their customers want is the cheapest product possible (which isn’t untrue) but their view of the cost of manufacturing doesn’t extend outside themselves. To founders and brands that have little experience in manufacturing, the hurdle of horrendous customer experience is often crippling.
For each of these challenges, let’s consider the REAL cost of manufacturing.
The cost of a unit, plus
The cost of the time of finding and establishing a high quality, scalable supply-chain (years in a lot of cases), plus
The cost of not knowing whether a manufacturer is hiding costs in the ‘black box’ of production, plus
The cost of time to manage and maintain supply chains (often multiple full-time personnel).
Today, the experience of our lives is mediated through technology. It makes us feel free, safe and liberated. Why should supply chains be any different?
"We associate technology with access. The experience of being able to log-on and quickly locate things of the highest quality, cheaply and quickly makes us feel free."
We associate technology with transparency. The experience of being able to log-on and have access to an overview of our lives makes us feel at ease. We associate technology with efficiency. The experience of being able to log-on and manage our lives in a few clicks makes us feel safe. We associate technology with access. The experience of being able to log-on and quickly locate things of the highest quality, cheaply and quickly makes us feel free.
Think back to Travis. How does Uber make you feel? The ability to go outside and KNOW you can tap a few buttons and a car will arrive is freeing.
Think to Brian. How does Airbnb make you feel? The ability to access a unique and beautiful travel experience makes us feel liberated.
Think to Reed. How does Netflix make you feel? The ability to go home and find quality entertainment, on-demand, without fail…
These experiences win.
There is nothing in the world of manufacturing that makes Direct-to-Consumer founders feel like this.
To translate these human emotions into a business lexicon, a lack of freedom, a lack of transparency and a lack of control all boil down to perceived risk. Risk, as we know, is crippling. It’s our job as founders, supply-chain managers and product developers to minimise and mitigate risk.
"These feelings of safety, transparency and access, combined with competitive pricing and high product quality mean we are attracting business rapidly."
We are finding that customers are jumping ship from their previous manufacturers and coming to the Atelier platform because we speak their language. That is to say, we look-like, sound-like and behave in a way that gives them a wholly new and unexpectedly open experience. These feelings of safety, transparency and access, combined with competitive pricing and high product quality mean we are attracting business rapidly.
The world is governed by beautiful, seamless UI. From our kitchens to our thermostats to our cars to our social lives to our workplaces. UI is now how we interact with complexity. Technology bears the load while we, the user, parse less information, with less stress and arrive at a better outcome, sooner. This tech-enhanced world has created a hunger for more tech-enhanced experiences. If we look at the world of a DTC brand why do we think that would stop at manufacturing. Think about how they operate their business, the services that support their great work.
A lot of manufacturers don’t even have websites… if they do it looks like they were developed on a GeoCities in 1998. Not exactly making young founders feel comfortable.
Think about it. This is the way a founder manages their capabilities, their business units and their lives.
Their sales process is managed by Salesforce.
Their internal communication is managed by Slack.
Their customer identification and community is managed by Instagram, Facebook.
Their fulfilment is managed by Shipwire, Shipit.
Their returns are managed by Returnly.
Their online store is managed by Shopify.
Their marketing process is managed by Monday, BaseCamp, Trello.
Their accounting is managed by Xero, QuickBooks etc.
Their manufacturing isn’t managed at all. The process that produces their product — the crux of their business — is in the wind. It becomes an obscured point of stress in their lives.
"In an industry enabled by tech, why is the manufacturing process sitting as a hyper-fragmented mess with no consideration of customer experience whatsoever?"
The world mediated by technology. In an industry enabled by tech, why is the manufacturing process sitting as a hyper-fragmented mess with no consideration of customer experience whatsoever?
Remember how you used to feel when you booked flights through a travel agent? Skeptical they were getting you the best deal, curious what their end in the deal was. The risk of being cheated was apparent. Then, the travel aggregation boom came. It made us feel safe. The cheapest flight will be ours, whenever we want it, without question. As I sit on a plane writing this, I think about that experience. The distrust I had for a travel agent. Now I am confident I am on the cheapest flight I could find within the parameters of my travel needs.
Sure feels good to have all that vision, knowledge and access.