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Posts Tagged ‘commitment’


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.

SC Excellence 1

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.

Supply Chain Excellence2
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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Leadership Pyramid Showing Vision Values Empowerment and Encouragement

Establish positive attitude and demonstrate your integrity to engage the team; and engagement leads to commitment and commitment results in enhanced productivity and improved productivity produces economic benefits to the Customers (Superior Quality and Cost Effective Products), Shareholders (Improved return on Investment), Employees (Career Growth and Job Certainty) and to the Organisation (Improved Brand Equity and Superior Financial Results).  Supply Chain is a team game and without cohesive and collaborative team you go nowhere.  In order to achieve all this; one should have the right attitude.  Someone appropriately commented that, “a bad attitude is like a flat Tyre, you can’t go anywhere till you change it”.

Positive attitude leads to great leadership and great supply chain results (Source: Gartner Supply Chain Top 25)

Top 25 SC Companies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

last 4 years comparison top supply chain

 

 

 

 

 

 

 

 

 

 

Believe in creating a successful future and not predicting the future!

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Supply Chain superiority determines organizational competitiveness.  Some believe that supply chain superiority or excellence is achieved with the help of three elements; process, people and technology.  Another group would advocate continuous improvement, benchmarking and KPIs, and innovative thinking would lead to supply chain excellence.  Do you think these factors drive the excellence?  My answer would be, yes and no.  Yes because these are fundamental requirements of any supply chain but beyond these elements something else works behind the scene to improve your supply chain effectiveness.

In order to make all above mentioned factors to work effectively three factors are critical.  The first and foremost is Collaborative Relationships.  The other two factors are Trust and Commitment.  In my opinion supply chain is all about managing relationships, demonstrating trust in relationships and committing to the core objectives. Let me explain how my theory works.  The below given graphic would explain various supply chain relationships:

As you can see from the above graphic supply chain manages internal and external relationships with various agencies.  Supply Chain relationship with Sales and Marketing, Manufacturing, Logistics, and various Vendors will ensure that the right product is made available at the right time and place at the right cost.  Sales team relationships with agents, distributors, retailers and consumers will make organizations grow and become competitive.

People make things happen, technology give us the ability to establish supply chain visibility and the process drives the activities.  However, all these factors could function in a silo apporach and make supply chains fail.  What is required is an integrated approach and integration is possible by establishing trusting relationships.  Effective relationship management can provide a positive contribution to sustainable supply chain superiority and also help to satisfy stakeholder interests.

Many organizations end up with huge inventories and wrong product on shelf and mounting supply chain costs.  The main reason for this catastrophe is lack of trusting relationships among supply chain partners.  In my opinion all above are supply chain partners.  The partners could include internal members as well as external members.  What is evident is that supply chain fails if the partners working for individual benefits without a common goal.  Someone said, we all stumble, that’s why it’s a comfort to go hand in hand.

Mutual trust was defined as “a shared belief that you can depend on each other to achieve a common purpose”.  Trust plays a crucial role in strengthening relationships and organisational changes and it is a critical component in building a collaborative relationship among supply chain partners. Trust creates an increase in openness among partners involved and it is perceived as a result of effective collaborative relationships and leading to higher levels of partner/customer satisfaction.  Trust is not gained in a day or two; trust is built up over a series of interpersonal encounters, in which the parties establish reciprocal obligations.

“An ounce of performance is worth pounds of promises”. In order to turn your promises into performance you need commitment. The third ingredient for the supply chain success recipe is commitment; commitment means to show loyalty, duty or pledge to the core organizational values.  In a partnership commitment plays a vital role along with trust. Someone rightly said, “unless commitment is made, there are only promises and hopes; but no plans.” Unless the supply chain partners are committed to a common goal which could deliver mutual benefits, it would be a challenge to establish a trusting and successful relationship.

According to a recent report from Boston-based AMR Research Inc., “companies that excel in supply-chain operations perform better in almost every financial measure of success. Where supply chain excellence improves demand-forecast accuracy, companies have a 5% higher profit margin, 15% less inventory, up to 17% stronger “perfect order” ratings, and 35% shorter cash-to-cash cycle times than their peers. Companies with higher perfect-order performance have higher earnings per share, a better return on assets, and higher profit margins — roughly 1% higher for every three percentage-point improvement in perfect orders”.  In order to achieve these two key measures (i.e. demand forecast accuracy and perfect order performance), committed collaborative and trusting relationships are crucial.

Hachiko – A Dog’s Story motivated me to write this article. This story is based on a true incident from Japan. This story is about the relationships, trust and commitment shown by a dog and also explains how invincible bonds form instantaneously in the most unlikely situations. We do not realize the value of relationships until reality bites.

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