Supply chains are mission critical
By Doug Colbeth, president and CEO
The unprecedented success of new consumer electronics such as the Apple iPod and Motorola Razr have shed light on how critical supply chains have become in the success of companies. With more and more business outsourcing to gain cost advantages, the ability to have a superior supply chain truly is becoming a competitive differentiator for companies. The other thing that has become clear is that no matter how much planning you do, there are going to be unexpected events that happen that you need to respond to - and the speed and accuracy of your response will dictate success or failure.
All businesses plan - and they should build the best plan possible. But companies also need to be prepared for the plan being wrong - since unexpected changes are the norm in today’s high-velocity marketplace. When you consider these two core business disciplines, they are quite different. Many companies invest lots of money in long-term strategic planning. This process tends to be very “top down” with key management leading the initiative and leveraging data from the rest of the organization. Yet, responding to changes in the plan tends to be completely the opposite. By its very nature it is not as much of a process as it is an ad hoc situation that must be dealt with. And, unlike the planning process that involves a small number of highly skilled planners, responding to change tends to involve lots of front-line decision makers throughout the organization - and frequently outside the organization (partners, suppliers, etc.).
Technology can help - but it needs to be specific to the function. Planning systems were designed for the planning function–small number of users, a specific process executed over a period of time that produces an output for others to use. Response Management is different. It needs to be built for the ad hoc situations - so it needs to be information rather than process-centric and it needs to empower all the front-line decision makers to rapidly collaborate and determine the best course of action no matter what the situation. And, the action they take needs to be aligned with corporate goals and objectives.
The runaway success of high profile products, and the rapid fall of others, have highlighted the need for effective Response Management and the unique capabilities that such technology needs to deliver.
