Is knowing tomorrow “good enough”?

DominicThomas

supply chain planning means knowing todayMy wife and I just moved into our new home that we spent a good deal of our lifesavings building.  We worked with our builder on every detail—windows, floors, paint, lighting—you name it. We met with so many of the tradespeople who invested so much time with us making everything just right—under my wife’s watchful eye I might add.  Shortly after we moved in, one key decision that we were left with was which company to use to install and monitor our alarm system. You see, I travel a lot for work and knowing that all is well at home is something that’s pretty important to me.

These days there are so many security companies to pick from, each one trumping the other with the latest and greatest innovation. From controlling access from your mobile device, to motion detecting camera systems, the common thread is “innovation”. When securing your family and the things you cherish most, would you rely on old technology?  Would “Hey, if we detect a burglar in your house, we will let you know tomorrow morning after our next batch run” make you feel good about your security company?

Shouldn’t the same go for your supply chain? Companies have invested hundreds of millions of dollars, pounds, euros and yen in supply chain planning systems since the late eighties. For a few, planning may have improved. For most, however, smart users have figured out ways of working around each of their disparate ERP and planning systems to make their businesses work. It is no secret that Microsoft Excel still remains the number one supply chain planning system in the world today.

So why not stay with the status quo, you ask? It has worked for me thus far, hasn’t it? Sure, your Excel worksheets are nice, but do they scale to the evolving needs of your business? By scale, I don’t just mean the amount of data it can handle – Microsoft fixed that issue by going to 1M rows with Office 2007. What I’m referring to is business process synchronization across different departments, geographies and groups in your organization. Are they all using the same planning processes? Are the KPI’s used by one department calculated differently for another? Do you have multiple versions of the truth when it comes to inventory? Are you capturing the vital qualitative data—assumptions, risks and opportunities—that went into past decisions? More importantly, is the historical information available to you when you need it? If you need to mine through your archive folder in Outlook to find the right revision of your worksheet, is that ideal?

Finally, what about Bob? Bob lives in every office. He’s that guy everyone on the planning team goes to for help. Bob knows every calculation in the spreadsheet and knows how it all works – what data comes from which ERP system, which macro needs to execute, and what broke in last night’s batch run. Bob’s the guy everyone is worried for when he crosses a busy street. Well let’s paint a more positive outcome for Bob. What if Bob wins the lottery tomorrow and decides that his golf swing needs some work… in Hawaii? Then what? I’m always amazed when I see large businesses—household names whose products we use every day—that rely on their own Bob or Jane. Do you identify with any or all of these issues in your organization today?

So how much would a system that can help you know sooner and act faster be worth to your business? In my world, it’s mandatory that the appropriate user be alerted the very instant a supply chain event occurs, and be allowed to take action. After tonight’s batch run, the information available tomorrow morning is stale and quite literally, yesterday’s news. Does anybody rely solely on newspapers these days to know what’s going on in the world?  Sorry… I digress.

To offer customers superb service and maintain a competitive edge, planners need to know NOW. A supplier is going to be late with a delivery; a customer doubles the quantity of an order; a recall of a key component of a marquis product; I would want to know now. But not only do I want to know about the problem, I want my planning system to allow me to develop scenarios and take action… now! Shouldn’t this be expected in today’s world of Google and iPhone? Without this, aren’t we essentially stepping into our DeLorean—yes the one with the flux capacitor—and taking a trip back to the 90’s with Marty and Doc?

So, do you run a response ready supply chain or do you still rely on a batch system that gives you the answer for today’s problem… tomorrow?

DominicThomas

As vice president of business consulting, Dominic is responsible for guiding the Kinaxis pre-sales consulting service, which specializes in establishing the value of RapidResponse for prospective clients and identifying specific solutions that fit client needs.

He joined Kinaxis in May of 2015 as a business consultant before taking on the role of vice president, business consulting, in November 2015. He has spent 20 years working with supply chain planning solutions across several different industries and is passionate about learning how large organizations run their supply chains and how innovative technologies can be applied to streamline processes and eliminate cost.

Dominic holds a degree in MIS from the University of Ottawa.

Discussions

  1. Great insight on excel , results based KPIs ar not going to make you a global leader. Every KPI needs root cause analytics they provide data behind the data. Must have leading Conditin based monitoring KZPs that drive the processes that provide business results. Must have shop floor to top floor data flows that can’t be massaged and are measured by the system with man out of the loop.

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