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Strategy - CHANGING FACEManufacturing, incentivised to utilise assets efficiently, continued to churn out producteven after true demand had fallen away dramatically and consequently locked in businessworking capital that needed to be flushed. In turn, the business was disconnected in theway it managed product portfolios and innovation. The business battled to operationaliseinnovation at the heart of growth.Even the billions spent on enterprise IT investments to improve transaction efficiency didn’tyield the expected returns. Reasons were: IT investments were made in application andfunctional silos and information wasn’t available to support the end-to-end processes andcontinuous improvement of supply chain and manufacturing performance aligned withmarket demand.Thus today’s transformation and change-leadership focus, for both leading medium-sizedand large global companies, is to build and continuously improve end-to-end demanddrivenvalue network capabilities.It starts at the source of real demand (the actual buyer) and includes translating thatdemand into value and the trade-offs that must be made across the operational supplynetwork. This has profound implications on continuous improvement strategies,performance metrics, change leadership and the use of enabling IT. Variability in supplyresponse is the enemy — in any form.Because the main concern of transforming the end-to-end supply chain has been elevatedto such a strategic level, it’s now being led and prioritised by the highest level businessleadership team. This has forced the leadership team to understand the end-to-endbusiness operation. While traditional supply chain and manufacturing efficiency hasbeen important and dominated performance discussions in the past, it’s nowacknowledged that costs alone aren’t crucial business growth differentiators and thebusiness can’t simply ‘save’ its way to growth.A business must determine what these new critical capabilities are that must bedeveloped across the end-to-end business. To explore and discover that capability, theleadership team is now tasked with challenging cross-functional discussions:• Defining and aligning buy and make side segments• Reducing non-value-adding complexity• Using end-to-end information visibility to improve growth and productivity acrossthe business• Using core processes such as sales and operations planning to translate demand andmake balanced trade-offs• A distributed organisational structure and competency model that supports organisationaleffectiveness across globally developed and emerging marketsContinuous improvement priorities have changedTo achieve and maintain balanced excellence, organisations should look at allinterdependent aspects of the end-to-end business and its processes differently.Traditional supply chain performance and efficiency metrics that preoccupied continuousimprovement discussions, now require more upstream and downstream context tocontribute to end-to-end business performance improvement.Thus today’s performance improvement agenda includes developing and improving newcapabilities and processes. These include using demand data and insights to advanceforecast accuracy and defining segments, based on buying and manufacturing behaviours,to address different characteristics in each segment appropriately.Even individual site manufacturing priorities have changed. Sites must operate as aglobal product supply network that includes suppliers and design partners. Local sitecharters must ensure that capabilities are in place to support matching supply todemand segments.Traditional continuous improvement approaches, such as Lean, Total Quality and SixSigma, simply aren’t enough on their own to improve customer-facing performance andsupport growth and productivity across the end-to-end business.ConclusionBusinesses are taking a refreshed view of supply chain strategy. The result is an end-to-endbusiness capability that’s prioritised to sense and translate demand into the supplynetwork. To support the refocus, changes are taking place in leadership and executionpriorities, organisational design, developing leadership talent, and priorities in theenabling IT Strategy.WGLL Journal Volume 2 © CCI info@etracc.net www.etracc.net
03 StrategyStrategy“New thinking recognises that no one is better positioned to address anoperation’s problems than the people who do the work.”WGLL Journal Volume 2 © CCI info@etracc.net www.etracc.net20
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Page 30 and 31: StrategyTHE PEOPLE IMPERATIVEResear
Page 32 and 33: Strategy“We all need to find our
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Page 36 and 37: StrategyWORTH THE JOURNEYStandard W
Page 38 and 39: IMPLEMENTATIONby Bill HughesAsset C
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Page 42 and 43: IMPLEMENTATIONby John Vaughan-Jones
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Page 48 and 49: CASE STUDYWGLL Journal Volume 2 ©
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