It takes a village to run a supply chain
I read a really interesting article by Ken Cottrill in the Supply Chain Strategy newsletter put out by Harvard Business Review (paid subscription required).
It was titled “It Takes a Village to Run a Supply Chain.” In it, Ken makes the following observations:
> “It’s already beginning to happen: more and more decisions that affect the supply chain are being made by more and more different people within the organization.”
> “Distributed decision making is changing the way your company works.”
This trend is very pervasive in the companies we work with and being driven in large part by rising customer expectations, increasing competitive pressures and an never-ending volatility throughout the outsourced environment. All of this leads to a need to empower front-line people with the information and tools they need to respond to change.
Historically, it was sufficient to have a small number of people build a plan and then have everyone execute to it. And, if things went wrong (unexpected changes), there was enough customer loyalty and/or “fat” in the system to cover - simply borrowing something out of safety stock to satisfy the customer and then replenish it as soon as you could.
This just doesn’t cut it anymore. Things have changed to the point that customer loyalty is all but gone (your competitors are a click away) and there is no more fat in the system. So, responding to change has become a competitive necessity and that means arming all the people dealing with the changes in demand, supply, capacity and product with the right tools to do so.
This is precisely why customers like Jabil have 4,000+ users of our software - because they figured out some time ago that you need to empower people to make smart and timely decisions to win.
In the same edition of the Supply Chain Strategy newsletter, there’s another article about “demand-driven innovation” - a key strategy for winning through innovation. Here too, they talk about the need for expecting and responding to change to support such a strategy.
There’s some interesting insights in this newsletter - worth checking out.
