Five signs its time for supply chain transformation

SarahHarkins

In spring, the flowers bloom. In fall, the leaves change. Some transformations follow a convention, but in supply chain that’s rarely the case. How do you know when it’s time for a shift? This was the question Kinaxis CEO John Sicard posed to three panelists at a Gartner conference earlier this year.

Leaders from Bose, Boston Scientific and ON Semiconductor shared key lessons from their supply chain transformations, including what led them to consider change. Check out the video and read their comments below. If these stories sound familiar, it might be time for your supply chain to change too.

1. The S&OP cycle has hit a wall

The S&OP process gains magnitudes of complexity when a new element, like an updated regulation or a market expansion, is added. The S&OP cycle may even slow down as the company grows. Planners can’t reduce the time it takes to complete the cycle despite making updates to existing technology and processes.

Example: “We were acquiring companies and we were frankly getting worried that our execs would go buy every time we looked the other way. We had a very fundamental problem: How do you scale?”

2. There’s misalignment between key functions.

As your company evolves, systems that once worked become disconnected, inefficient and unreliable. Communication breaks down. Planners can’t work with contract manufacturers. Purchasers don’t have visibility into existing inventory. Everything may seem fine until a bump in the road reveals the truth: There are blind spots in the supply chain.

Example: “My traditional KPIs around having inventory and DCs and availability [looked fine] and then hearing complaints that customers weren’t getting product didn’t make sense. But when you start to look at it from the customer lens, there were real problems there in the supply chain.”

3. Data issues are routine.

All supply chains have data errors, but if exhaustive searches rarely reveal the source of the problem – or reveal new problems – it might be more than run-of-the-mill complexity. Left unaddressed, planners may even use these issues to hide mistakes.

Example: “In the past, you could argue about numbers. It was like a smoke screen. …After a while, people understood that if you just point somewhere else, the problem goes away.”

4. It’s impossible to onboard new planners.

Your supply chain planning process is so complicated that your company is reluctant to hire an outsider. Recruiters believe that only someone on the inside of the company could understand the intricacies of the supply chain planning system.

Example: “People wanted to hire somebody from the company, even if they were in engineering, because they understood the language.”

5. Other business units are encouraging or pressuring you to make reform.

Your Sales team wants more transparency into the planning process. The IT team volunteers its time to improve your software. Finance asks whether the planning team will be able to reach business goals. When other business units suggest modifications, it’s because they see the supply chain as an obstacle to progress.

Example“Finance has these benchmarks on cash flow and inventory. So they are behind us to say, ‘Hey guys, you can do better.’ And, of course, we want to be good team players and be able to meet those requirements.”

Supply chain transformation that meets your needs

The best supply chain solutions scale with your business, meeting new challenges as they arise. Learn more about supply chain transformation and change management. Watch the full Gartner panel to get further tips and insights from leaders at Bose, Boston Scientific, ON Semiconductor and Kinaxis.

Watch "Supply chain transformation: Real stories of innovation"

SarahHarkins

Sarah draws on her experience as an editor, data journalist and consultant to create blog posts and online content for Kinaxis. Before joining the team in 2019, she developed communications strategies for nonprofits, associations and Fortune 500 companies in Washington, D.C. Most recently, she was Insights Editor for the creative and consulting division of The Atlantic, where she created content strategy and audience growth tactics based on the publisher’s most influential journalism. She has also worked for groups like National Journal, Investigative Reporters and Editors, and the Sunlight Foundation. She has an MA in Journalism from the University of Missouri and a BA in Psychology from the University of Oklahoma.

More blog posts by Sarah Harkins

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