Author Archives: Mark Oldfield

Innovation – a long hard road to a better one.

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It does not matter what your profession, there is always the need to keep up to date with trends, new poducts/services and the latest news.  While I was doing my own regular reseach I came across an archived article labled Supply Chain-Driven Innovation. It was very interesting reading from six years ago and the message from the author,  Kevin O’Marah,  is the still the same, basically the Supply Chain Manager must:

Use more data from more sources
Inform more people
Collaborate more
Understand other corporate functions
Expect change

The Havard Business Shool article is found at:  http://hbswk.hbs.edu/archive/5139.html

It is only now that the Supply Chain is being seen as an equal to the traditional ‘critical’  functions such as Marketing and Finance. Companies are now realising that Supply Chain is also critical and by having the collaboration of, and between the functions, then innovative ideas will happen and overall benefits will be achieved.

I suppose this was bound to happen as the issues of supply have found their way to the top of many an agenda, for example the cost of fuel (freight), the global market place (logistics), the cost of space (storage), the requirements of the customer (demand/procurement), and the impact each has on other functions of the business.

And just as the Supply Chain Manager must understand other corporate functions, the managers of other corporate functions must also understand Supply Chain. And as Marketing is far more than just showing a product to market or Finance computing an EBITDA, so Supply Chain is more than just organising the carrier for a delivery.  So it’s good to see there are companies with Supply Chain positions at C-Level.

So the question is: do you see your Supply Chain as just support for other fuctions or as a functionitself that can help build a commercial and/or competitive advantage?

Using Customer complaints to improve your supply chain

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Marketing talk about the “better mousetrap syndrome”, it is not a bigger, better, faster mouse trap that customers want – they just want to be rid of the mouse, so too with Supply. Customers just want what they order, when they expect it (or told to expect it).

Many times the message will be heard that customers want a faster more reliable delivery service. So the Distribution Manager will call for a meeting with the Carrier asking they address the problem – now. But by drilling down it is found customers are receiving their orders anywhere between 4-25 days with a gazetted delivery of 6 days.

In fact after talking to the customers, all they really want (as an example) is to get a guarantee that their orders will arrive on day 6, every time and this actually happens.

To achieve this will not entail just talking to the carrier and setting KPIs and exception reports etc, there will need to be a proper Root Cause Analysis carried out.  You may find that aside from the Carriers own issues there are delays throughout the process, for example the time it takes to receive and enter an order, the picking schedules in the warehouse, the collection schedules, the availability of stock etc.

There are many ways a company can improve their own Supply Chain without the need to rush out and purchase new systems or equipment. Often it is seeing the big picture, then following some basic steps:

1-       Map the Supply Chain

2-       Identify the bottle necks

3-       Identify a few, appropriate KPIs

4-       Put into place an Exception Reporting process (to trigger Root Cause Analysis & Corrective Actions)

5-       Use your ‘CAR’ system to record and monitor issues, both operational and systemic.

6-       Communicate with all stake-holders: suppliers-staff-customers

Like the Mousetrap, investing in bigger, faster processes and products may not be what is required, it might just be to stabilise what you have and set appropriate customer expectations.  A targeted approach such as this will cost less, retain customers and will probably reduce ongoing costs.