The 'chords' of supply chains
Despite a whirlwind of changes in e-commerce and technology, a few tenets of supply chain management will always hold true.
The great jazz saxophonist Charlie (Yardbird) Parker was once asked by an awed neophyte, “How do you do that? I just practice scales over and over.”
“You've got to learn your instrument,” he famously said. “Then, you practice, practice, practice. And then, when you finally get up there on the bandstand, forget all that and just wail."
When it comes to supply chain, the jazz analogy can hold true. The industry has been changed by e-commerce, technology, the global market, emerging nations, ever-present risk, corporate social responsibility and more.
But the basic chords and scales of the supply chain will always exist, and you need to “learn your instrument” before you can “just wail.”
The 'forever' supply chain
“The basic concepts and elements of supply chain are immutable,” says Robert Allen, Principal, Operations Practice Leader at The Hackett Group. “Synchronization, collaboration, the drive towards efficiency and effectiveness and improving the top and bottom line all are key. ‘Collaborization’ has always been critical with customers, co-manufacturing partners, suppliers, and everyone else in the value chain.”
Allen adds that while digital advances certainly help, "we’re ultimately still operating in the physical world.” Whether it’s automotive parts, oil well rigs, clothing, electronics, it really doesn't matter. When transported via cold chain, air freight, ocean freight, intermodal, it doesn't matter. You have to know the basics.
Forecasting always has been around, but the advances in technology have changed the way it is done. Yet, says Sean Riley, Global Industry Director, Manufacturing & Transportation at Software AG, there’s still a basic knowledge that is “forever.”
“The focus on how to improve forecasting through improved data sources and better analytics requires a deep understanding of supply chain principles and methodologies that serve as a guide for data scientists to create predictive analytics,” Riley points out.
When disaster strikes
Sometimes things go wrong, and that’s where experience and critical thinking meet risk management, says Riley.
Critical thinking when faced with the unexpected is vital, he says. The supply chain pros “have the ability to respond in a manner that supports seemingly conflicting goals like ensuring cost efficiency while exceeding customer demand."
Sanjiv Mahajan, Associate Principal at The Hackett Group, adds that sound strategy is another constant, another “forever” part of supply chain, especially when it comes to mitigating risk — or any other business problem.
“Companies need to balance efficiency and effectiveness, then drive toward that. Digital may help them get there faster and cheaper, but in the end they must decide what business problem they are trying to solve and how supply chain can support it.”
Helping do that becomes the responsibility of leadership. Lora Cecere, founder of research firm Supply Chain Insights, listed 'leadership' as most important when asked for her thoughts on fundamentals of supply chain that haven’t changed. She said good supply chain leaders must establish and maintain consistency in supply chain strategy. “They also need to train and empower employees,” she added.
The Hackett Group’s Mahajan agrees. “Companies must continuously be upgrading the skill set of their supply chain staff, shifting the skill set of their organization as needs and priorities change.”
Don’t forget the customer
You’re on the bandstand ready to let loose. Remember, though, that your customer is the audience. And if the basics aren't met, your innovative tactics won’t mean a thing.
“The need to focus on the customer certainly never changes,” says Mahajan. “It’s critical to start from an understanding of what the customer wants. Otherwise, even if you’re investing in digital technology, it is unlikely to have the most impact.”
“In short,” concludes Chris Sawchuk, Principal & Global Procurement Advisory Practice Leader at The Hackett Group, “the objectives of supply chain won’t change. Digital transformation and all of the other changes and enhancements are allowing us to realize the objectives and visions we have always had in terms of customer-centricity, transparency, responsiveness and more.”
Are you ready to wail?
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