[Part 3] Your supply chains…

…eliminating doubt

You have supply chains that deliver.

Continuous improvement is a constant.

Customer service levels are always watched and usually optimized.

Yet customers want more.

Some want more speed. Others want more agility. Yet others want more reliability.

Which way to turn?

While tech is part of the answer, which part?

And how do you specify new tech needs when customers are so different and keep changing their minds?

It’s a conundrum – one that leaves you mired in doubt….

…doubt about making the wrong, and expensive, choice…

…doubt about throwing your supply chains into chaos, resulting in more customer “discussions” and definitely not making you a favorite of other functional areas…

…doubt about whether the tech chosen, that fits so well today, will fit so well tomorrow (as in actually tomorrow).

Here’s the thing: when you are consumed with fear, uncertainty, and doubt –three things that keep you up at night and hold you hostage – you end up running in circles instead of forward.

Let’s break that hostage holding and move forward.

Below, we unlock the critical elements you should evaluate. Make sure to bring into your organization anything that is missing. You need all the pieces to drive away doubt.

First, you need to have structure

Many businesses try to avoid structure (think processes, approval levels) because they are viewed as red tape. Remember, though, the red tape moniker is achieved when structure isn’t reviewed continuously and updated as required.

The truth is, structure is the only way you scale, are agile, and can move to meet customer demands – assuming those demands meet your approved performance mix and criteria. You now get to choose – which means you stop running in circles.

You already know this because you run supply chains.

Even so, in today’s fast changing economies, most companies throw structure out the window in an attempt to move more quickly around established processes to meet ever changing customer demands. Why the need to go around? Because the performance being promised isn’t performance you are set up to provide. The result: you’re left to pick up the fallen pieces and try to make sense of the ensuing chaos.

All because you either don’t have the language to encourage adherence to the structure in place, or the tool to adjust the structure so you’ll know ahead of time if the changes desired will or will not improve your company’s performance. That means you’re left guessing while you try to keep things moving and mostly meeting service levels without too many mistakes.

Yet it doesn’t have to be this way.

As a trusted consultant, I am expected to bring to my clients tools that organize chaos quickly, can be used by professionals easily, and provide support when you need to put a halt to going around the established structure. My go to is SCOR (Supply Chain Operations Reference model) to get things done.

Why? Because SCOR is like a set of Legos®.

Supply chains have many moving parts. A model has many pieces to be put together. Legos® have many pieces to be put together, too. But unlike a prepackaged model, the end form is what you decide it needs to be. Your structure must mirror your desired supply chains while supporting and enabling your performance. And that is exactly what the SCOR Legos® allow you to do: build, implement, and support the performance that provides your customers with what they want before they ask for it – often even before they know what it is exactly that they do want.

Second, your chosen performance mix dictates that you meet specific requirements.

Each supply chain meets the needs of specific customer sets. The values your customers expect are embedded in your processes (structure) and the metric hierarchy you set up.

Yes, each supply chain may have different performance requirements, but at no time will those requirements be an unknown.

This touches one of the huge, and often unexpected, truths of today’s supply chains. One size (type) of supply chain does not fit all customers.

While the product or service delivered may be the same, each performance mix dictates a different method of performance. Each supply chain has its own performance mix. You can’t expect a reliable, high volume low mix supply chain (think car tires or vaccines) to be able to competently handle your high mix low volume orders (think e-commerce). The processes (structure) have different requirements for each of the manufacturing, logistics, and procurement components of your supply chain – even though the same product may run through either type of supply chain.

How do you keep it all straight?

The chosen structure guides your order fulfillment processes and dictates the use of specific supply chains or supply chain segments. SCOR strategically helps you implement infrastructure that keeps these supply chain service levels high using reports in near, if not actual, real time metrics, and keeps chaos at bay.

New technology needs will be apparent based on the performance results captured in the hierarchy of metrics you’ve chosen (standardized in SCOR). The performance boundaries describe what is needed where – from a performance point of view. Technology is then matched to supply chain needs, not the other way around. This aligns operations activity into the strategic KPI’s. Continuous alignment is enabled by the early warning metrics you put in place to signal need for improvement in specific supply chain performance or capabilities.

Using the structure and the metrics hierarchy allows you to comfortably choose an advanced tech tool set that won’t miss the mark.

This type of internal alignment and early warning signaling with performance requirement boundaries helps your employees trust decisions to change structural components. Employees can easily see how the performance is responding to changes as they are put in place. The metrics provide the visibility. Real time monitoring allows for rapid adjustment with constant or improving customer service levels. No more shiny objects without a foundation of need. You can say yes with confidence to shiny objects that meet your performance and capability requirements. Shiny objects that provide improvement and keep your customers buying from you.

You create the win-win for both you and your customer because you define which shiny objects need to be used with your SCOR Legos®.

Third, stay the strategic course.

You have the requirements, structure, early warning signals, and superior customer pleasing performance in place. Continuous improvement is focused and targeted to improve specific performance gaps.

Yet there is always a desire to change what is working to something else that looks promising. Hey, the other company is doing something new. Why shouldn’t we?

The answer is simple: your structure, processes, early warning signals, chosen performance mix, and culture surrounding all of this is unique. You cannot cut and paste what someone else is using/doing into your environment and expect it to work.

A digital technology may hold promise, but that promise needs to be fulfilled within the performance boundary conditions that match customer values.

But what if the order to change comes from the executive team?

You have the data (from the metric hierarchy) and performance requirements (from your customer knowledge and service levels) to hold meaningful discussions.

There is something driving the idea for change – figure out what is really wanted and then determine how your current structure, or slight changes to it, can provide the change desired.

Even if that change is advanced, digital technology implementation.

You, through your use of SCOR, have the ability to choose the right digital tool based on the performance requirements, structural boundary conditions, and capability knowledge (SCOR includes embedded people skills and capacity for a holistic look at your supply chain capabilities).

You, through your use of SCOR, have the ability to plan a realistic phase-in of your digital tech stack.

You know, without a doubt, that the new tech stack will deliver the performance desired.

You know this because you have the data, requirements, and capability to make meaningful adjustments to your structure. It never becomes “just more red tape”.

Even better, adjustments are made that will not take down your capability to serve your customers. In fact, customers may opt in to help test the new shiny object you’re presenting them with.

What stands to be lost from this win-win?

Fear, uncertainty, doubt

Three words that used to have you running in circles, but no more.

How? By using SCOR strategically. It’s what I use with the companies I serve, which means: smallcaps, in Covid times, make an 8x daily revenue increase in 6 weeks; midcaps triple their business valuation in 2 years; global supply chains transform successfully due to the new alignment between functional groups and strategic plans.

What success stories will you tell when you replace fear, uncertainty, and doubt with confidence and success?

All it takes is for you to decide to end the chaos.

To learn more about SCOR and how it can propel your supply chains forward, click here

 

Keywords and concepts: SCOR, supply chain, digital transformation, technology, performance, metric hierarchy, process

Dr. Cynthia Kalina-Kaminsky is the President of Process & Strategy Solutions and a SCOR master instructor and consultant. Feb. 8 is the start of her virtual SCOR workshop (no travel required) which includes digital transformation how-to. Learn more here