Strategic Supply Chain Management - Supply Chain Online

204 Strategic Supply Chain Management
metrics used in other core functions. Never develop a performance-management
system in a vacuum.
Understand and respect your organization’s capabilities, and strike a
balance on business criticality when introducing new measurement requirements.
Products and geographic regions can be brought online progressively.
A metrics program does not have to be initiated simultaneously for
all regions, channels, and products.
Establishing the measurement frequency up front can help to avoid
costly reimplementation of data structures. This does not preclude providing
reporting on a less frequent basis, a tactic that may be useful if the organization
is not ready to exploit more real-time information. Focus on fast
“clock speed” metrics on a daily or weekly basis and report the remainder
as part of your balanced scorecard. Also determine the appropriate level of
visibility. The goal should be visibility all along the supply chain, including
a sufficient amount of drill-down capability to understand performance
differences by, for example, originating factory and warehouse.
Identify all required data sources, and make the data accessible. For
example, if you choose to monitor the percentage of orders delivered on
time to the customer’s request, you will need the ability to capture the customer
request date. Some transactional systems do not have a field for this
information, and many systems, while capable of tracking this date, are
not programmed to do so.
A gap analysis of data elements and data sources is a vital first step
to ensure that existing data are accessible to decision makers. If you are
like many companies, you may have large amounts of data buried within
multiple, disparate systems. An information systems architecture for both
applications and infrastructure is needed to pull data from different
sources and enable timely decision making. To simplify both data gathering
and reporting, design the data-capture and reporting infrastructure
using standard data and metric definitions.
Take the time to understand the performance-management software
market. It is made up of many discrete tools and components, enterprise
suites, and packaged applications, including such categories as reporting,
business intelligence, advanced planning and scheduling (APS) analytics,
supply chain event management, and supply chain performance management.
As you evaluate the system tools available, resist the temptation to
create an all-encompassing data warehouse to enable “slicing and dicing”
for root-cause analysis and resolution. Integrating extensive sets of lowertier
metrics can lead to an overly complex implementation and should not
be seen as a prerequisite for an effective metrics program.