June 21, 2007

What's in a name?

What's in a name? It's an age old question that makes you sit up and think for a second......what is in a name???

We live in a world that loves to categorize and use naming conventions. Everything in its category and a name for each. We all do it and examples are everywhere. If you live in metro Boston or New York, you're either a Red Sox fan or a Yankees fan...no in-between. No middle ground, one or the other. Democrat or Republican....North vs. South.....East Coast vs. West Coast....make your choice.
In a business context, it gets even more definitive. Names like "customer" and "supplier" have been traditionally etched in stone. We also have names like "product provider" or "service provider" and "software vendor" or "hardware vendor". Once again, pretty strict lines and definitions. No co-mingling the offering...one or the other...but not both. You know that old saying: if it looks like a duck and quacks like a duck, well then, it must be a duck. Or is it??

Let's get out of the theoretical for a moment and look at the real world example of how the "name game" is changing in the high tech supply chain. Historically, the high tech distribution space has used broad category names in order to designate segments or "turf" where companies play. Primarily, they fell into two main spaces, commonly referred to and "named" the "back end" and the "front end" of the supply chain.

Traditionally, the back end folks, a/k/a Electronic Component Distributors, linked suppliers such as Philips and Atmel with OEMs, ODMs, and EMS companies and the front end guys, a/k/a Resellers, VARS, and Retailers, connected end user communities with finished goods. Very simple, very clean, and in some respects, these "names" gave order to a supply chain that ordinarily had none. That said, we now live in a world that has electronic component distributors moving into the finished goods space and resellers pushing into service marketplaces. Won't there be chaos if we step outside our "named" areas? Not really. In fact, most of this movement is customer and market driven with the end result being a better, more comprehensive, and more valuable service for customers.

Now let's look at the Independent Distribution category. There seems to be a consistent hole in the way the historical and current supply chain participants are "named", specifically, Independent Distributors are left out. Not the "right" name so no category or value proposition. Believe me, I know the talk track used to explain this omission. To name a few, statements like "they operate outside the lines" or "they have no official product designations" have been used for a long time. In reality, both are untrue and irrelevant at the same time.

The fact is, Independent Distribution has been supporting both "front end" and "back end" customers for as long as there has been a "front and back end". And in the current environment, the more diversified Independents are moving outside their traditional model of helping to source products customers need and sell products they don't, and into really effective reverse supply chain and service supply chain spaces. Once again, customer driven services leading to a complete portfolio offering for the forward and reverse supply chain. All under one roof. What a great idea. Although the overwhelming majority of high tech supply chain participants use an Independent Distributor in their forward or reverse supply chains, it seems that the industry is now just beginning to acknowledge the value others have discovered long ago. Capabilities...plus service.... plus flexibility... equals value, regardless of the name or category.

I guess it all boils down to another age old saying...you can't judge a book by its cover.

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