It is a common thought in the business world that logistics and supply chain management, as essential and important business divisions for delivering the right product at the right place at the right time, are not as exciting and fun as other business divisions like marketing or sales.
However in the last decade, the world and the workforce has dramatically changed due to the expansion of smartphones, digitalization, and Generation Y and Millennials starting their professional lives. Additionally, we are seeing changes in supply chain management as the concept of gamification is becoming more popular in branches like distribution and warehousing.
What is gamification? Simply put, gamification is applying typical gaming elements (e.g. point scoring, leaderboards, rules of play) to other areas of activity, but, this concept is far broader and adaptive to each business case. The idea behind gamification is that it helps improve the learning curve on complex tasks, the quality of the end-result of a task, or the transformation of daunting tasks into more engaging tasks for the employee.
One example of gamification in the supply chain industry is with a supplier of a well-known coffee shop chain in the U.S. They improved their profit margin and delivery efficiency for the distribution of non-coffee items such as paper cups, napkins, etc. to retail stores. The distributor accomplished this by creating a gamified data center where members could see each others score with good or bad reputation points regarding their performance; mimicking the concept of a video game leaderboard. Once the data was shared, all partners (suppliers, distributors, retail stores) self-organized and began collaborating to improve the global performance by improving their own performance.
Another form of gamification is the expansion of loyalty programs, such as store loyalty cards.This helps companies gather customer information, and in our digital era, we all know that information is the key to success. Furthermore on the other side of the supply chain, car-makers organize rewarding Oscars-like ceremonies for their suppliers every year to enhance supplier engagement.
Finally, gamification is used for training purposes with the use of progress bars and badges as learning achievements to motivate employees. Another unexpected and increasingly popular use of gamification is virtual reality. For example, a warehouse manager can experiment with various warehousing solutions to better understand the impact of a decision before implementing it in real life.