About Returns '17
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ABOUT RETURNS is a brand new event to talk about the Reverse Supply Chain and Returns Management in a Customer-Centric and Circular Economy. ABOUT RETURNS '17 is the kickoff for an event that we will organize every year.
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About Returns '17
- 1. Welcome to ABOUT RETURNS ‘17
- 2. THANK YOU for being a founding attendee of ABOUT RETURNS 3PL 12% Brand 12% Consultant 18% Education 2% Finance 8% Logistics 16% Recovery 10% Retailer 8% Student 4% Technology 8%
- 3. WHY
- 4. AGENDA: 1. An academic view on Closed Loop Supply Chain Management 2. Trends that drive the importance of the Reverse Supply Chain 3. Returns Management Software presentation 4. About Returns panel discussion 5. Networking drinks
- 5. An academic view on Closed Loop Supply Chain Management
- 6. Closed loop supply chains: the road to value Creation Prof dr ir Harold Krikke
- 7. Open Universiteit Nederland • Southern Netherlands (Heerlen) • Distance learning • BsC, MsC and PhD program • 15.000 students, wide variety in age but mostly 30-45 years • Three faculties, amongst which Management Science and Technology • 50 external PhD, 20 internal PhD
- 8. Closed-loop supply chain management is the design, control and operation of a system to maximize value creation over the entire life-cycle of a product with dynamic recovery of value from different types and volumes of returns over time. Guide and Van Wassenhove, 2006. harvesting
- 9. Positioning economy business Product Extended Producer Responsibility Cradle2Cradle Process Circular economy Closed loop SC
- 10. Closed loop and the life Cycle
- 11. Value Creation pyramide Customer Value Sourcing Value Environmental Value Social Value Feedback or information value
- 12. Onderwerp via >Beeld >Koptekst en voettekst Pagina 12 Waarde kan ook negatief zijn!
- 13. Compliance
- 14. CLSCs/RSCs Coordinating decisions stakeholders Customer Value Sourcing Value Environmental Value Social Value Collaboration
- 15. Critical success factors in value Creation in Closed loop • Compliance • Extended producer responsibility • Quality and hygiene • Complexity • Product design and supply chain design • Disassembly and recovery optimization (multi-loop) • Control • Gate keeping, product acquisition, use of IT • Collaboration • Stakeholders management/alignment • Industrial ecology and energy storage in clusters • Carbon footprint • Context (type of business) • Customer • Value creation/PSS • Modularity/reconfiguration • Repurchase intention and returns behavior
- 16. What is Customer service?• A product-service system (PSS), also known as a function-oriented business model, is a business model, developed in academia, that is aimed at providing sustainability of both consumption and production M.B. Cooka, T.A. Bhamrab & M. Lemonc (2006). "The Transfer and Application of Product Service Systems: From Academia to UK Manufacturing Firms". Journal of Cleaner Production. Elsevier Ltd. 14 (17): 1455– 1465.doi:10.1016/j.jclepro.2006.01.018. • Product Oriented. Ownership with remains with customer but additional services supplied. • Example: extended warranty on car • User Oriented. Ownership with provider but usage rights with customer • Example: lease car • Result oriented. Direct function delivered. Owner is provider or one customer. • Example: shared car
- 17. Subtypes of PSS
- 18. Benefits and barriers • Less risk for customer • Constant revenue stream • More sustainable • Byer supplier relations • Installed base monitoring • Stable demand and return flow • Capital investment (upfront) • Uncertainty for customer (life time guarantee) • Customer freedom of choice reduced • Technology dev/upgrades • Economies of scale (lagging), first mile • Benefits sustainability unclear
- 19. Assignment I: how to inCorporate new values in business model (duo) • Which values to incorporate in customer proposition • Value for whom? (pros and cons) • **
- 20. What is a business model? • A business model concerns • Customer value proposition • Products/ offered to market segments and customer relations management (‘Marketing’) • Value creation and delivery. • Management of resources, processes, partners/stakeholders and technology (‘SCM’) • Value capture. • Cost structure and revenue stream (‘verdienmodel’). This includes capital needed and ROI. Adapted from Bocken et al., 2014
- 21. ReCent typology (van Ostayen et al., 2013) • Input based • Availability based • Usage based • Performance based • Solution focus • Effect focus • Demand focus • HYBRIDS
- 22. Assignment II • Which subtype of PSS is most feasible? • per type of industry and/or • per phase in the life cycle? • Are hybrids needed?
- 23. ExerCise harvesting reman refurbish reuse Re-fill recycle PSS Automotive Industrial equipment Medical equipment E-commerce cartridges E-waste product Related service Advice consulting Extended warranty use Lease Rent Share/pool result Act mgt/ outsource Pay per unit Functional result (SLA)
- 24. Classic PSS typology falls short Classic typology does not capture essence of value creation within closed loop: a. It does not connect to the key elements of business model b. More values than in the past play a role but how to integrate them in the business model? c. Stakeholders interests, e.g. third parties may be involved due to capital requirements d. Requirements may change over the life cycle e. We have to understand dynamics between business models and other succesfactors as well as values mutual.
- 26. System DynamiCs Recovered products and parts Returned products and parts +Sales recovered products and parts + Installed base + + Product design Customer services Information management Business model Trade-In rate + + Maren Schenkel, 2016
- 27. Cannibalization
- 28. Assignment III • Start the virtuous circle by reversing the vicious circle. • How to manage dynamics of transition? • Role stakeholders and alignment? • Where to start? Onderwerp via >Beeld >Koptekst en voettekst Pagina 28
- 29. Wrap up • Multiple CsF in value Creation with mutual relations • Multiple values (positive and negative) • Manage dynamic to create virtuous circles • PSS is not a full grown business model • One size fits all does not work (ergo product Leasing) • Research agenda Keep the C alive
- 30. Research agenda • Topics and funding • Value Creation in closed loop supply chains (Maren Schenkel) • Value of information and organizational learning (Ilkka) • Forecasting and intervention • 3D and (CL) supply chain design (Victor Verboeket) • Supply chain risk (Quan Zhu and Evangelos) • Footprinting, economics & stakeholders • CIRCULAR BUSINESS MODELS (> NWO call) • Plastic soup • Cold chain and returns • Research questions • How to develop PSS into full business model • Interaction other CSFs (Business model and value of information) • Role of the life cycle, hybrids • Multiple values (are circular business models more sustainable?) • Stakeholders (lock-ins, mutual dependency) MANAGE DYNAMICS
- 31. Trends that drive the importance of the Reverse Supply Chain
- 32. Why worry about returns? 1 Because there are so many damn returns in e-commerce. Because something fundamental is going on.2
- 33. Because something fundamental is going on. 1. Direct-to-Customer Commerce 2. Experience- & Share Economy 3. Circular Economy
- 34. Direct-to-Customer Commerce The customer is king. 1
- 37. Direct-to-Customer Commerce 1 The customer is at the steering wheel of her shopping experience (and supply chain).
- 38. Direct-to-Customer Commerce 1 More Complete and On-Time Inbound & Outbound Orders Reduced Total Landed Cost per unit Lower Average Stock-out Rates Reduced Transportation Cost per unit Greater Finished Goods Inventory Turns Per Year Improved Out-of-Stock recovery time Source: Aberdeen Group
- 40. Experience & Share Economy 2 Customers don’t buy products. They buy experiences.
- 41. Experience & Share Economy 2
- 42. Experience & Share Economy 2 Customer Journey Purchase: 1. Right product 2. Right place 3. Right quantity 4. Right price 5. Right time 6. Right service Product: 1. Useful 2. Available 3. Sustainable 4. Fun to use 5. Easy to dispose BUY USE
- 43. Experience & Share Economy 2 DeliveryPurchaseOrientation Buy conversion focused End of UseAt UseStart of Use Use retention focused
- 44. Experience & Share Economy 2 End of UseAt UseStart of Use Use retention focused
- 45. 1. Direct-to-Customer Commerce 2. Experience- & Share Economy
- 46. Circular Economy 3 Product value should not get lost.
- 47. Circular Economy 3 The linear economic system needs to be stopped.
- 48. Circular Economy 3 Products should circulate in the production system, like leaves do in the natural system.
- 49. 1. Direct-to-Customer Commerce 2. Experience- & Share Economy 3. Circular Economy
- 50. Change Customer CentricCircularFlexibleScalableSustainable The circular economy is an economic system that is designed to maximize reusability of products and raw materials and minimizing value destruction. Unlike the current linear system, in which raw materials are converted into products to be destroyed at the end of their life.
- 51. Change to a new Economy An economy is the system of production, distribution and consumption of scarce goods and services in a society. Products Supply Chain Consumers
- 52. A closed loop supply chain for a customer centric and circular economy. Change to a new Supply Chain
- 53. Plan Source Make Deliver Return Sales Journey Conversion focused Orientation Purchase Delivery Service Journey Retention focused Start of Use At Use End of Use Customer Service Operations Returns & Exchanges Warranty & Repair Take-Back & Recycling “I don’t like it” “Help, it doesn’t work” “I don’t use it anymore” Refund & Exchange Repair & Replace Reward & Rebate Forward Supply Chain Reverse Supply Chain
- 54. DeliverMakeSourcePlan Start of Use At Use End of Use Return Returns & Exchanges Refund / Exchange Warranty & Repair Repair / Replace Take-Back & Recycling Reward / Rebate Reuse, Resell Repair, Refurbishment, Remanufacturing (parts) Recovery, Recycling
- 55. Supply Chain Forward Reverse Plan Source Make Deliver Return Record-to-Report Procure-to-Pay Order-to-Cash Return-to- Settlement Business Processes Change to a new Business Process
- 56. “very interesting product and I think a really good handle on representing the reverse supply chain as an extension of the existing forward supply chain... great reference to the connectedness of customer service operations and supply chain operations in what they called a returns-to- settlement business process...”
- 57. Solutions for the Reverse Supply Chain. Driven by Technology.
- 60. Behind every product return is a customer Unlock the opportunity to turn the returns process into customer service.
- 61. OPERATE COMMUNICATE 12RETURN RETURN JOURNEY Returns Authorisation Returns Settlement Recover Bring returned products into a new supply chain to generate business value. Insights Turn data from the returns process into valuable insights to prevent future unwanted return or stimulate future wanted returns. Reverse Logistics Returns Processing
- 63. CUSTOMER CENTRIC
- 65. FLEXIBILITY
- 66. SCALABILITY
- 67. Behind the returns process is a team Give your teams and partners all tools to beat the returns challenge together.
- 71. Insights Flexible, scalable and independent.
- 73. For Midsize and Enterprises A flexible and scalable solution for the Reverse Supply Chain.
- 74. Open API standard for external integration Returns Authorization Returns Settlement Reverse Logistics Returns Processing ERP / Shopping Cart System Carrier Services WMS / RMS Connectors Alerters EndpointsStandard Integrations Standard Integrations Endpoints Alerters
- 75. Global scalable trusted enterprise cloud 1 Americas EMEA APAC (2018) Amsterdam 2 Dallas 3 Hong Kong
- 78. About Returns Panel Discussion
- 79. ABOUT RETURNS DISCUSSION: 1. The importance of the Reverse Supply Chain 2. Trends and future developments 3. How is 12Return helping? 4. What is expected from 12Return?