Part 2 by Geoff Chambers
Director, Supply Chain Services
A division of Scarbrough Consulting
As we continue to underscore the critical substance of Supply Chain Modeling & Planning, recognizing the importance of transformation, let’s review a list of the key objectives and their end results:
Resiliency in your upstream & downstream supply chain (SCRM -Supply Chain Risk Management)
Agility & Responsiveness
Increasing overall operating efficiencies
Business unit cross-collaboration (IBP -Integrated Business Planning)
Holistic data & information flow (HDIF)
While resiliency warrants a stand-alone article, in essence, it is your abilities to navigate supply chain disruptions with both your upstream and downstream suppliers and customers. In other words, Know Your Suppliers (Tiers 1, 2, & 3), as well as Know Your Customers through analytics and demand planning. Your abilities to be agile and responsive will become increasingly more important as we traverse 2024.
As you look to improve operating efficiencies, it is paramount to understand Business unit cross-collaboration. If we review the first article, the directives for an Integrated Business plan include a tree of KPI’s. The KPI’s become a catalyst for communication between departments, all while having common directives which provide visibility at each stage of your manufacturing, raw material sourcing & distribution channels.
Simply put, all departments are propagating a unified goal. This includes Holistic data & information flow. Leadership must be engaged as well as your outsourced consultants must be engaged if applicable.
Let’s review a few of the most common supply chain modeling & planning methodologies:
Functional Siloed Planning
Limited Manual Collaboration
Demand Planning
Collaborative S&OP
In 1996 there was a program that introduced Functional Siloed Planning (SCOR - Supply Chain Operations Reference). While there have been improvements to SCOR and its applications such as digitization, you must move away from this siloed approach. Functional siloed planning relies strongly on manual processes, functional tools such as excel, which inhibit your abilities and visibility to a holistic IBP (Integrated Business Plan).
Moreover, during COVID, many companies used Limited Manual Collaboration. The focus turned sharply to supply chain forecasting to minimize costs while including Sales & Marketing to an extent.
Demand planning has an intricate piece in the core structure of an IBP. However, it is only one conduit and includes the abilities to analyze customer historic data with trend analysis. Without cross-business unit collaboration, there is still limited visibility into the supply chain. In addition, Collaborative S&OP, which combines Demand Planning with Sales & Operations involvement, plus elementary reports and analytics, do not provide complete business perceptibility.
It we review the graphic below addressing IBP, you can see the potential benefits of combing a series of carefully orchestrated dynamics. While technology does have a key role, we must again underscore the value of Leadership’s understanding of transformation and its applicable fundamentals.
Without getting too far into the philosophical side of Forward Momentum and next steps, we must recognize that the right side of the brain sees the vision and the left side provides the action. They are symmetrically equal. Some are visionaries and can see the big picture while others are more in tune with the action of the vision. You need both to implement an Integrated Business Plan. This again revolves around combination strategies & collaboration -moving away from Functional Siloed thinking to create circular process improvements.
The question is, are you ready to transform your business with a GTM “Go to Market Strategy” that is foundationally sound with an IBP and a holistic approach to grow competitively in the years ahead?
Geoff Chambers
The Scarbrough Group
International • Logistics • Transportation • Consulting • Warehousing
7280 NW 87th Terrace, Suite 300, Kansas City, MO 64153
Geoff Chambers gchambers@scarbrough-intl.com
O: +1.816.584.2400 | D: +1.816.683.8457