“Supply Chain Management 2.0” or Supply Chain “Management 2.0”

Published June 7th, 2012 by Kirk Munroe 1 Comment

At the Gartner Executive Supply Chain Conference last month, one of the key note speakers was Gary Hamel, long-time business guru and currently Author and Director, Management Lab.  I saw Hamel present seven or eight years ago and since then, I have been measuring all management speakers against him as the standard.  Some have come close – no one has raised the bar yet.  That is until this latest presentation where Hamel raised the bar for himself.

The topic was “Management 2.0” – a topic Hamel has been discussing for a few years now, but it was the first time I had the pleasure to hear it in a live setting.  As with any good presentation, the more I reflected on it, it made me think about our ongoing conversation around “If you could re-name SCM today, would you? If so, what would it be?” to commemorate the 30th anniversary of the term SCM.

When I commented on that blog, I didn’t want to do the predictable and:

  • say that the word that should change was “supply.”  Supply is certainly not the ideal word as others pointed out.  It is about supply and demand.  Maybe I should have used the word “value” as Bill Seliger pointed out in his comments to my post.  Value certainly better encompasses the end-to-end process better than just ‘supply’, but it felt predictable to say that.
  • say that the word that should change was “chain.”  Chain has an implication of linear and we know this space is anything but linear.  It is complex and using a word like “network” as Dustin Mattison suggested makes a lot of sense.  I agree, but again, I didn’t want to seem predictable.
  • call it SCM 2.0.  I really, really didn’t want to “2.0” it … seemed like too much of an easy way out.

So, I wanted to focus on the word “management.”  The word is so loaded to me.  It conjures up words like hierarchy, control, rigidity.  So I suggested an “E” for excellence or effectiveness.

Hamel made me come to the realization that I also took an easy way out.  I challenged the word management instead of challenging what management really means (In this context, I mean the act of managing, not of the organizational hierarchy, though of course they are linked.) Basically, if I had it to do over again, I would suggest Supply Chain “Management 2.0” – still not “Supply Chain Management 2.0.”  What do I mean?  The critical piece that we have to address is that the breakthroughs have to come from the discipline of management itself.  Saying to give up, or go beyond, management was the easy way out.  Let’s challenge what it means to manage instead – how best to run and maintain a function, process and even an entire organization.

For those of you who have not seen or heard Hamel on the topic, his assertion is that management is the great technological advancement of the last 100 years, but has basically not changed much in the past 20 years, give or take.  One of the hottest topics that comes up in the business world – in blogs, presentations, business courses – is that the world continues to change more rapidly than it ever has before.  Change is not only growing in velocity, it is growing at an accelerated rate.  Change or die.  Embrace change.  We have not only heard all these things, we have used then.  And rightly so – they are all true.

What Hamel questions is that everyone seems to acknowledge the need to embrace change, the need to be able to respond to change quickly with both the customer and shareholder in mind, the need to be more innovative in general; however, a very small number of companies have embraced a management structure that allows this to happen.  Wemanagement still have rigid hierarchies (which typically lead to organizations growing by tenfold in short bursts – I know I picture Facebook as 30 people in one room and not the 3000 or so reported at IPO time – two bursts of growth, I guess).  We don’t have innovation training programs.   We have employees who do not feel empowered and are generally – to the tune of 80% or so – unhappy in their jobs.   This lead to the most memorable quote of the presentation, “it is not work that sucks, but management that blows.”   Sadly, well put for too many organizations.

For more on Hamel and Management 2.0, his blog is a great place to start.

Now that I am invoking my mulligan for my answer to the question of what I would call SCM, let’s look at the management practices that are (at least should be) different from SCM of 30 years ago, SCM 2.0 and Supply Chain with “Management 2.0” – taking into consideration that I am obviously taking liberties with Dr. Hamel’s work and that I am categorizing each of the three as “SCM 1.0 = Old School Management”, “SCM 2.0 = evolving management but not going all the way to 2.0” and “SC’M2.0’ is incorporating new management practices into the value network”.

In the table below, I am taking a quick view of what the transition from SCM 1.0 through SC”M 2.0” looks like.  Whether or not you want to categorize yourself is up to you, but questions, comments and “are you out of your mind?!” are always welcome.

Follow comments on this blog post via RSS

One Response to ““Supply Chain Management 2.0” or Supply Chain “Management 2.0””

  1. SCM 2.0 or SC”M2.0” ? « Logistics Info

    [...] Kirk Munroe, a supply chain thought leader, in his blog in Kinaxis, broke down the phrase into supply, chain, and management as three separate words to understand the underlying meaning in a better way. He says supply is not the ideal word as the subject encompasses both supply and demand. According to him, value is a better word. “Value certainly better encompasses the end-to-end process better than just ‘supply’, but it felt predictable to say that, “he says. [...]

Leave a Reply