Strategic Supply Chain Management - Supply Chain Online

CHAPTER 3 Core Discipline 3: Design Your Organization for Performance 103
ment or function. But as your supply chain strategy and processes evolve,
you’ll need to embrace a new set of metrics designed to optimize performance
for the company as a whole, as we’ll discuss in Core Discipline 5.
If you don’t restructure and develop your organization in a way that supports
these new performance objectives, you’ll likely fall short of your
targets and sabotage your supply chain strategy.
We rarely see a shift in strategy so major that it drives a fundamental
rethinking of needed skills and an organizational overhaul. Because
your supply chain organization is responsible for executing your supply
chain strategy, you’ll need to consider them both in parallel.
Stratex Networks, a leading provider of digital microwave radios,
provides a case in point, illustrating how capabilities within the supply
chain organization can be developed and improved as the supply chain
strategy becomes more focused and corresponding process changes are
made. In early 2002, Stratex made a strategic decision to focus on improving
its return on assets and customer service levels by elevating orderdelivery
performance and reducing order-fulfillment cycle time. Among
other changes, this meant a fundamental overhaul of the company’s operations
strategy and a move to outsourced manufacturing. The company
embarked on an aggressive schedule for the transfer of production from
San Jose, California, to a manufacturing partner in Taiwan.
In parallel with the transfer of manufacturing, Robert Schlaefli,
Stratex vice president of global operations, launched an initiative to fundamentally
redesign the company’s core supply chain processes to support
the new manufacturing model. 1 The company needed to maintain strong
relationships with several key suppliers while transferring responsibility
for most materials purchasing to its new manufacturing partner. Stratex
also was concerned about the communication challenges inherent in an
outsourcing relationship and wanted to ensure that customer requirements
could be collected, integrated, and acted on as quickly as possible.
Many of the new processes were designed to optimize the flow of an
order as it progressed through the configuration and manufacturing
process—for example, the criteria for accepting a customer order were
updated, and checklists were put in place to ensure that all critical information
was available prior to order entry, eliminating the delays that
occurred when required data had to be researched after the order was
already in process. But Stratex still had information gaps between functional
groups and confusion about which function ultimately was responsible
for order-delivery performance. While regional sales administration,
finance, order management, planning, procurement, and traffic were each