Amazon’s plans to control the entire endto-end supply chain, from creation to consumption, may sound ambitious, even far-fetched to some, but it is fast becoming reality. Sean Culey, an author and business transformation expert, says to achieve this goal the likes of Amazon and Chinese counter part JD.com have to be able to track everything, not only everywhere but all the time. And this is only about three to five years off. “Blockchain and 5G will be pivotal to achieving this visibility,” he said, indicating that products these e-commerce retailers already controlled in their entirety would see them taking over the entire supply chain rapidly once the technology had stabilised and the business case had been proven. “5G is being launched this year providing the technology that is required to underpin the Internet of Things,” said Culey. “These developments are going to see change happen rapidly and exponentially and faster than what we ever expected.” He said companies needed to make very real paradigm shifts now to understand they were no longer in control, that it was not about the company anymore, but the customer. “The customer is in charge. Companies that do not understand this will simply go out of business,” he said. According to Culey this was where Amazon was finding success – entering any market simply because it had spotted excess profit and underserved customers. “Walmart, for example, is finding itself competing with Amazon on groceries,” he said. The e-commerce giant, said Culey, was moving so rapidly that a company like Walmart, with a long history in fast-moving consumer goods, was already playing catch- up in its own business domain. “Amazon just dropped free two-day shipping to one day. This led to Walmart having to kick back and do exactly the same.” Amazon, he said, had stepped into an arena it did not know but had quickly become the business with the competitive advantage in that sector. And it was doing this across the board. “In another example, Amazon has broken ground on a $1.5-billion airport as it moves ahead to cut out the need for other logistics companies.” It was a model aimed at manufacturing closer to the consumer and delivering within a day of ordering, with tight control over the manufacturing, warehousing and shipping processes. “It is a new world out there,” said Culey. “Companies like Amazon and JD.com understand the importance of the customer interface because that is where you collect the data and that is the currency we trade in.” Amazon started off selling books but it has evolved into ‘the everything’ store. It sold whatever the customer wanted, said Culey, and it was doing it faster and better than anyone else. “Amazon has spent $45 billion on research and development in the past few years. It is moving at a pace unlike any other.” Amazon, said Culey, was the biggest competitor regardless of whether you were in manufacturing, retail or even logistics. “You simply just have not realised it.”
Amazon has broken ground on a $1.5-billion airport as it moves ahead to cut out the need for other logistics companies. – Sean Culey
