Dean Ocampo, head of Solutions Strategy at Elementum, talks to Andrew Hobbs about cybersecurity, the promise of blockchain, and how the Internet of Things is redefining brands and their supply chains.
Having been at supply chain orchestration platform provider Elementum since it was a startup in stealth mode, Dean Ocampo is well placed to reflect on how digital transformation is reshaping the industry. His role combines technological and customer-facing aspects, giving him a top-level perspective on the end-to-end influence of the Internet of Things.
Internet of Business grabbed the opportunity for an exclusive Q&A.
Internet of Business: What are the biggest supply chain challenges right now, and how can the likes of the IoT and AI help resolve them?
Dean Ocampo: “We’re facing four major technology shifts that fundamentally alter our relationship with supply chains and data. These are:
- Big Data has accelerated the pace of supply chains
- AI and machine learning are making supply chains more agile in detecting and executing opportunities
- Blockchains are rewriting the ownership relationships and dependencies in data
- Disintermediation strategies are eliminating the need for some value entities.
“When the dust settles, the winners in this race will be those who write new business models and rewire value streams. This has deep implications for people in the supply chain space and what will be needed to thrive.”
In a society in which 68 percent of customers choose instant gratification over brand loyalty, how can the IoT help solve the supply chain challenges in the ‘need it now’ world?
“There is no question that buyers are choosing instant gratification over brand, but I think it’s because the definition of brand value has to change. Today a brand is largely defined by how it speaks to a customer and how quickly it satisfies their needs.
When the only change is speed of satisfaction, it’s going to be a main motivator. But brands must evolve beyond this shallow approach towards an immersive model where they bring real value-add to consumers’ lives.
“I recently had a conversation with a Fortune 500 company that was over a hundred years old. They’re taking a beating from new market entrants that give instant gratification.
“But imagine if they were running on a digitised supply chain that allowed them to orchestrate the flow of goods across multiple channels, and they employed the IoT to get deeper connections with how customers used their product, along with AI to help proactively spot trends and make recommendations.
“If they combined that with over a century of working with consumers in their sector they would create a real dialogue with buyers, engage them in conversations with other buyers, and learn how to tailor their products to particular lifestyles.
I don’t care if you’re Amazon, that’s the kind of brand experience that can’t be beat. But these brands must adopt these new technological behaviours in a way that turns their models on their heads, making their historical inertia an advantage, rather than an impediment.”
How will big data, the IoT, and related technologies affect operational costs?
“In and of themselves, the likes of big data and IoT will do nothing to improve costs. In fact, I see a lot of organisations structuring proofs of concept that just spin resources and time. Like any new tool, it’s figuring out how to apply it to a business problem or opportunity that makes a difference.
“The smart companies right now are defining specific business outcomes as the basis for technology experimentation. Asking your team to ‘take this GPS and temp sensor and see what it does’ is a fundamentally different proposition to saying, ‘focus on improving customer satisfaction by using GPS and temp sensors to eliminate our delivery black hole.”
If we apply this focus to technology, Ocampo argues, we will rewrite the benchmarks for supply chain operational and capital expenditure. Even so, he concludes, it is not costs that stand to benefit most from IoT, but the revenue and market share that come from offering a superior service.
How does this work on a practical level? What does end-to-end implementation involve and how long does it take?
“No one owns their own supply chain. Many entities need to combine to get products to customers. This is fundamentally why we created Elementum, bringing technologies from the consumer sector – such as social and collaborative tools, and data visualisation – into a platform that reflects the network-to-member relationship that’s inherent in supply chains.
Companies have to shift their thinking from a me-centric mentality to a we-centric one. Do so, and you’d be surprised how fast companies can implement end-to-end solutions.
“If you think about all the data already touching material as it goes through a value chain and all the smart people who interact with it, you can combine them surprisingly quickly. I’m seeing six to eight months to value, rather than years.”
Are solution providers serious enough about cybersecurity?
“As someone with a background in cybersecurity, no! Particularly when traditional inside-out technologies are being vastly extended across the internet.
“We have to take lessons from the commercial technology stacks and apply them to supply chains. They’ve built some great defence in depth, and cloud governance and security processes that can be leveraged.
“The big issue that scares me is cyber warfare. It’s clear that nations are systematically using cyber-disruption on supply chains. I read one study where a nation state openly talked about disrupting replenishment and basic supply chain operations for carrier groups out of San Diego.
“We just have to be mindful of cybersecurity issues and adapt to the world we live in. After all, seeing car accidents doesn’t keep me from driving to work.”
What effect can the IoT have on environmental issues around supply chain, such as fuel usage and product wastage?
“We’ve already done a lot of improvement here, as much of this is low-hanging fruit. It’s just a matter of larger scale adoption and micro eco-optimisation.
But the IoT is enabling us to move product creation closer to the buyer and disintermediate antiquated systems or relationships. That’s when we’ll see macro environmental improvements.
Do you see blockchain playing a growing role in supply chains?
“Absolutely. But it’s complicated by the industry struggling with the frameworks and expertise required to evaluate blockchain in context.
“Blockchain is revolutionary in some ways, but not in others. The supply chain applications discussed so far can already be solved without blockchain, and it still needs to prove itself at the transaction scale needed in supply chains.
“However, in the long term, the ubiquity of access, non-repudiation, and distributed ownership are all core needs in supply chains. But it’s important to solve for the problem, not the technology, and only employ blockchain when it makes sense.”
It sounds like this is an exciting time to be in the supply chain business…
“It reminds me of the late 90s in the consumer world. Deregulation transformed telecommunications and put the infrastructure in place for what would become the internet age.
“Fast forward to today and the consumer cloud app world has built an entire suite of technologies that are now ready for supply chain scale. So the question is, ‘Who will be the next Jeff Bezos or Mark Zuckerberg?’”
Internet of Business says
The confluence of a range of technologies, from sensors, RFID tags, and the IoT, to robotics, AI, 3D printing, supply chain optimisation, and driverless vehicles could create a very different manufacturing, logistics, and distribution model to the monolithic systems of old.
A value chain that is personalised, automated, and localised (PAL) could solve a multitude of problems, as well as offering enormous environmental benefits. Read transformation consultant Sean Culey’s report on this for Internet of Business.