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Archive for July, 2014


In the last article, it was identified and established that Supply Chain is the key enabler for business growth. It is time now to understand what measures within supply chain drives supply chain excellence. As shown in the below figure, five elements contribute towards supply chain excellence. It starts with People, Quality, Velocity, Cost, and finally Agility to react to the dynamic business environment.

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In this article let me share my experience about how people can effectively contribute to the success of the business.

People:

Bill Gates once said, “Success is a lousy teacher. It seduces smart people into thinking they can’t lose.” Success is not a permanent partner, success is a visitor in some cases, and hence, people may have to pursue the path of continuous improvement to sustain in this challenging environment. “Success consists of going from failure to failure without loss of enthusiasm”. If one critically examines the only difference between successful people and the rest is nothing but lack of will to succeed.

In order to be successful in business we need a leader who can articulate the vision and goals of the organisation and along with him we need group of people whom we can call them as cohesive team. In order to be a successful team we need few critical attributes and they are:

Engagement – It is a challenge to any organisation to create an environment where employees who are part of the cohesive team understand the organisational goals and commit to the organizational vision created by the leader. Job engagement and organisational engagement leads to employee engagement. Happy employee is a productive employee. Hence, it is a key measure.

Leadership – It is an old school of thought that there is only one leader in the organisation. Yes, there is one leader at the top and he/she needs leadership support from many functional silos. It is essential that these emerging leaders should be trained in the areas of Communication; Motivating teams; Team building; Risk taking; Vision and goal setting. Last but not least is to recognize and reward the team’s performance. Say at least thanks for their contributions.

Think outside the box – Today’s business is dynamic, volatile and challenging, and the ability to improve continuously is very critical to the success of the organisation. The core driver to make your team to think outside the box is to deliver competitive differentiation in the market place. Due to product proliferation, there is no dearth of choices to the consumers, the product has to be unique and deliver total customer experience. This process is not static and it is continuously evolving. Unless one develops ideas and transforms them into reality that meets tomorrow’s customer needs, it would be highly challenging to survive in the market. Thinking is unlimited, there is myth that humans use only around 10% of their ability to think. It is not thinking that matters, Lateral thinking is the need of the hour!

Team Work – Success of any team depends upon the team work and team’s collective strength and wisdom. The best teamwork comes from group of individuals who collectively agree to work independently and together towards one identified organisational goal in unison. Let us not forget ““The strength of the team is each individual member. The strength of each member is the team.” In short WE = Power of Success!

Change Management – “Change is the law of life. And those who look only to the past or present are certain to miss the future” John F. Kennedy. The world is changing in other words, it is evolving and if you live in the past and deliver a product belonging to yesterday for tomorrow’s world, the outcome would be disastrous. Obviously change is driven by a vision, get your vision right, build a team that could deliver your vision, empower the team, celebrate short term successes, and most importantly communicate and deliver the change message periodically. Change ushers exciting opportunity and at the same time could deliver loss, disruption or threat to some organisations. How such change process is managed can be the difference between surviving and thriving in a work or business environment. Change management should be developed as an inherent characteristic of any organisation who would like to survive and thrive in this world.

Perseverance – As mentioned earlier success is a visitor if you fail to pursue it consistently, it will desert you. In my opinion one may face many defeats in our journey in search of excellence, but you should never get defeated. The defeat teaches the critical lessons to how to succeed. Whereas success only makes you complacent. In order to manage sustainable success, it is absolutely necessary to be persuasive. Abraham Lincoln once said, “I am a slow walker, but I never walk back.”

Continuous Improvement – “Excellent firms don’t believe in excellence – only in constant improvement and constant change” Tom Peters. We can write tons of information how we can achieve continuous and sustainable improvement through the leadership vision and team work. Let us examine a case study which delivers invaluable information how continuous improvement in supply chain delivers competitive advantage in the market place.

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Note: Please double click the image to see it large.

The human being is yet to invent an automated system that could foster sustainable continuous improvement in any field. It is all driven by the committed teams all around the world. Team of individuals is not a system, it is the group of people with commitment to make tomorrow a bright one and with emotions to win with persistent efforts and with a faith to turn hopeless failure into glorious success.

Any business organisation must have a clearly identified unique core objectives which differentiates the organisation with competitors. The so called differentiation comes through innovation of the people in the form of enhanced technology, improved quality, cost competitiveness, total customer experience. All these factors are articulated by a leader and implemented by the group of people whom we called an integrated and cohesive team.

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A decade ago people used to believe that people, process and technology are the three Business enablers.  John F Kennedy once said, “the Chinese use two brush strokes to write the word ‘crisis.’ one brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger–but recognize the opportunity”. In today’s world globalization propels the business growth and at the same time, presents massive challenges in the form of supply chain.  This phenomenon called globalization impacts the economy, product life cycle, society, environment and personal life too.

I am not sure if anyone measured the increase in competition due to globalization, but surely the globalization has immensely improved sustainable competitiveness in many organisations.  In order to be competitive in this world of uncertainties and volatile market conditions, we need a successful formula that could deliver and address challenges such as global reach, price competitiveness, agility and rapidity to reach the market, improved production and supply lead time, make vs. buy decisions, identifying non-core activities and outsourcing, improved operating profit after capital charge, on top of all this, EVA, total customer satisfaction and happy investors.  The role of the supply chain has never been as important as it is in today’s globalized economy. Supply Chain speed and agility have become two key levers for competitive differentiation and increased profitability. Today’s supply Chain successfully handles all the challenges identified above and converts those challenges into opportunities in order to deliver competitive advantage to the organisation. And it is proved time and again  that Supply Chain is the core business enabler apart from people, process and technology.

Today there is no dearth for technology, we have variety of technological tools that offer variety of automation, the need of the hour is the people who can understand the business dynamics and customer expectations and develop effective supply chain processes that adds value and delivers competitive advantage and sustainability to the business.

Supply Chain delivers broadly four competitive advantages to the business and that includes, cost benefits, flexibility benefits, quality benefits and last but not least is the lead time benefits.  These benefits are driven through Planning, Continuous Improvement, Quality (standard work to achieve consistency) and the ability to reach global customers faster and efficiently.

The below figure shows the supply chain functional pyramid:

Pic1Whereas the business is not a charity, in order to be successful, it has to generate profits keep the shareholders happy and encourage them to invest more money into the business.  George W Bush rightly pointed out that, “you can’t do today’s job with yesterday’s methods and be in business tomorrow”.  And that is where we need effective, advanced and cutting-edge supply chain processes and efficiencies.  A good business leader should create a vision, articulate it passionately and drive towards completion.  Any good vision will have four “P”s in it, people, process, product and profitability.  If you look into the business objectives pyramid, you will find all these elements in one form or the other.

The below figure shows the Business Growth and Prosperity Pyramid:

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The Alignment:

In the month of December 2013, Hitachi Consulting group report (published in Europe) indicated that 80% of supply chain managers do not see their supply chain as an enabler of business strategies within their organisation.  Greg Kinsey, VP of Hitachi Consulting, said: “The results from our survey make one thing very clear – disconnect between a company’s business transformation strategy and the day-to-day management of the supply chain remains a serious, yet hidden, problem for many organisations.  Hence, it is absolutely necessary to align the supply chain transformation strategy with the business strategy in order to excel in today’s dynamic, challenging, volatile, confusing, compelling, and exasperating world of business.  The below figure explains the alignment between supply chain transformation and business growth and prosperity with right people, processes and with the help of technology.

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It is very critical that the supply chain transformation is well aligned with business growth and prosperity strategies.  The below figure illustrates the path for the alignment.

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Organizations may have to recognize that the supply chain transformation and alignment with the organisational goals and objectives delivers a competitive market differentiation.  The uniqueness sells; let us not forget that uniqueness’s core objective is to create that magic of alignment between supply chain and organisational goals.  In order to achieve the short and long term goals the transformed and aligned supply chain will have critical influence on business and organisational outcomes and to large extent on the shareholders and customers.

It is worth concluding this article with 7 simple supply chain lessons taught by Steve Jobs of Apple Computers (Source: Supplychain247.com)

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