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Benefits of improvement in Supply Chain come in several layers.
While considering improvement in certain critical customer-facing processes, supply chain teams do consider the potential benefits against the cost incurred, if any. My experience suggests that many benefits get missed out by teams in such an analysis. Let’s consider an example.
Check-out counters at retail outlets have credit card machines to accept customer payments. Some retailers have a pool of such machines between their counters. A few retailers have each counter with its own dedicated machine. How do you decide whether to have a pool of machines or have dedicated machines?
Dedicated machines may require additional investment. What’s the incremental benefit?
The most obvious benefit is faster processing at the counter and time saved in printing the receipt. This would mean more customers processed per counter and less counters for the same footfall.
This is not all. From the consumer point of view, faster checkout and smaller queues mean a lot. It may result in this retailer getting preferential treatment.
The third level of benefit is higher trust. Dedicated machines mean the checkout person doesn’t have to key in the bill amount and there are no chances of human errors. Consumers can blindly tap their card just looking at the bill amount on the billing screen.
Of course, higher trust does have a positive rub-off on other transactional elements as well.