04-08-2025
Customer-Centricity Has Come To Supply Chain Management
Supply chains have typically been quiet enablers, optimized for cost, consistency, and scale. But in today's volatile world, supply chains must no longer be designed solely for efficiency; they must also be engineered for agility and responsiveness. That begins with putting the customer at the center.
Customer-centricity isn't just a mantra for marketing anymore. It's becoming the organizing principle of resilient supply chain strategy. This idea is fully embraced by Birger Buesching, Head of North America Supply Chain at Philips Personal Health. As he told me in a recent interview, the company's efforts to regionalize and modernize its supply chain were sparked not by tariffs or trade friction, but by a deeper question: 'How do we become a more customer-centric supply chain?'
Winning in Multiple Dimensions
Traditionally, supply chains have been built for standardization. They've often been slow-moving, tightly engineered systems designed to squeeze out every cent of cost. That model made sense in a stable world. But in Buesching's words, 'Speed in your supply chain is as important as cost. Innovation cycles are shrinking. Demand shifts rapidly. You can't wait 18 months to react.'
For Philips, a customer-centric supply chain starts by deeply understanding the customer's business model. 'We don't have a one-size-fits-all approach,' Buesching explains. 'Selling to Costco is different than selling to Amazon or Walmart. Their expectations, inventory philosophies, and speed requirements vary. So we shape our supply chain accordingly.'
That tailoring shapes decisions about what products to offer, how quickly to introduce new SKUs, and even where to manufacture. For example, regionalizing production isn't only about navigating tariffs; it's also about staying close to customers, responding to changes quickly, and reducing lead times from months to weeks.
Syncing Supply Chain With Sales
Too often, supply chains and sales teams operate in parallel universes. Philips takes a different approach. It embeds supply chain leadership directly into commercial planning. 'My role is to translate our North America Personal Health business strategy into supply chain requirements,' Buesching says. That means aligning with marketing on long-term positioning, and with sales on shorter-term demand signals.
At the heart of this integration is a structure known as the 'customer collaboration team,' a dedicated supply chain team that works hand-in-hand with top retail partners. These teams go beyond exchanging data. They co-create forecasts, align assumptions, and jointly plan promotions and replenishment. 'They're not just liaisons,' Buesching emphasizes. 'They are the voice of the customer inside our organization.'
One powerful example: by working closely with a major retailer, Philips was able to bypass its own distribution centers and ship directly from factory to some customers' Distribution Center. This resulted in faster response to demand spikes and lower shared costs. 'When you treat supply chains as ecosystems — source to shelf — you can find win-wins,' Buesching says.
Technology as the Enabler
Digital tools are playing an ever-larger role in enabling customer-centricity. But Buesching is quick to note that visibility alone isn't enough. 'Everyone talks about sharing data, but the real value is in what you do with it. It's the 'so what?' that matters.'
Advanced analytics and AI can help close that gap. While early AI applications in forecasting have delivered mixed results, Philips has begun exploring AI for real-time decision-making. 'When disruptions occur, planners need to act fast,' Buesching explains. 'AI can integrate systems, flag exceptions, and support what I call 'augmented decision-making,'helping people respond quickly, not just stare at dashboards.'
Other Leaders, Same Lesson
Philips isn't alone in this shift. At Unilever, for example, supply chain teams have co-located with marketing and innovation functions to speed up time-to-market for new products. The company's 'Connected 4 Growth' initiative restructured supply chain ownership to align more directly with customer segments and categories.
Meanwhile, in the home improvement space, Home Depot has invested billions in building out a 'One Supply Chain' initiative that enables same-day fulfillment across multiple channels. By organizing around the customer journey, not just SKUs, the company has built a supply chain that supports both weekend DIYers and professional contractors with equal ease.
How to Build a Customer-Centric Supply Chain
For smaller companies, this can all sound intimidating. But the principles are universal. Buesching offers three pieces of advice:
The Way Forward
In an era of seemingly endless disruption, supply chains can become engines of competitive advantage. That requires a new playbook where supply chains flex with demand and communicate with clarity.
Customer-centricity isn't just a value. It's a strategy. And in today's world, it may just be your critical hedge against tomorrow's uncertainty.
