Strategic Supply Chain Management - Supply Chain Online

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240 Strategic Supply Chain Management focusing on the return on investment of individual supply chain initiatives, GM looks closely at how different initiatives can work together to support its overall supply chain goals and analyzes which need to precede others. This sort of approach is critical in creating a path to next-generation performance. Consider, for instance, the interrelationship between structuralsimplification and process-change initiatives. Should the physical distribution network be simplified before inventory management practices are changed Should SKU proliferation be addressed before embarking on a new approach to supply chain planning Identifying dependencies may reveal that initiatives previously thought to be unrelated are, in fact, on the critical path to the success of the overall effort. You also may find that a proposed initiative is likely to have an impact on the return of one or more existing projects, which may lead to reprioritizing or even canceling an in-process effort. Continuing our example of Company X, the management team will need to consider a number of factors that affect delivery performance. These may include ◆ ◆ ◆ ◆ ◆ ◆ Issues with the core planning processes that result in ongoing imbalances between demand and supply Internal policies that cause orders to get caught in an extensive credit-verification process Aggressive inventory targets that cause business units to operate with overly conservative inventory levels Skill gaps inside the organization that limit overall effectiveness Conflicting performance targets that drive suboptimal behavior Inconsistent performance by key partners, such as material suppliers or logistics service providers Addressing these issues requires a clear understanding of the interdependencies of the major activities being considered. Will a redesign of the planning process have the necessary impact if supplier delivery performance remains below acceptable levels Do the responsible individuals have the experience and skills to define and execute the required process changes Are the new processes dependent on new systems capabilities These are just a few of the questions that need to be answered as part of developing the roadmap. Consider Your Culture and Environment Including an initiative in your roadmap requires that you look beyond any technical solutions and consider the “softer” factors of your culture and
CHAPTER 6 A Roadmap to Change 241 environment. How does your organization deal with change At some companies, transformation efforts are embraced. At others, past experience has created a strong mistrust of large-scale initiatives, and only small steps are acceptable. Also consider your business environment. How important is improving supply chain performance relative to other business priorities Can the right resources be made available Although current performance may be well below what is dictated by your supply chain strategy, the reality of how your company operates may override what you view as a critical initiative, and other business imperatives may claim the resources necessary to execute the roadmap. If this happens, you’ll need to adjust your ambitions accordingly. Finally, take the stability of your organization’s management team into account, particularly at the most senior level. Next-generation supply chain practices have a major impact on decision making; as such, any new initiative will be shaped by the management team’s vision of how decisions should be made. A lack of continuity at the executive level, especially during the more difficult, early phases of implementation, may destroy an initiative’s momentum. If this is a concern, consider delaying the start of the roadmap execution until you are confident that you will have the ongoing support you need. Test your readiness to establish and manage the priorities for change by making sure that you can answer the following questions: ◆ ◆ ◆ ◆ ◆ Look beyond any technical solutions and consider the “softer” factors of your culture and environment. What are your value objectives and priorities What type of change is needed to create the value Are ongoing supply chain initiatives still appropriate, or do you need to stop or redirect initiatives Given your environment (resources, other business priorities, potential management team turnover), what type of change is feasible Given your culture, what approach (big bang, small steps, etc.) is most appropriate Step 2: Design the Solution Once you have consensus on your priorities, the next step is to identify the changes needed to support your value objectives. To do this effectively,
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Copyright © 2005 by The McGraw-Hil
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viii CONTENTS OWENS CORNING PROFILE
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x FOREWORD now it has to be brought
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xii FOREWORD Another “early adopt
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xiv FOREWORD through research, use,
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xvi FOREWORD on its promise. Is thi
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xviii ACKNOWLEDGMENTS owe thanks to
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2 Strategic Supply Chain Management
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10 Strategic Supply Chain Managemen
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Page 298 and 299: Stage 4: Cross-Enterprise Collabora
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308 Index Business strategy: metric
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310 Index F Faught, Laura, 175-176
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312 Index Mexico, 96, 196 Michelin,
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314 Index Regional planning group,
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316 Index Toys “R” Us, 53 Trace
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