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I want to alert you to an upcoming webcast – What’s the Bottom Line? Connecting Your Supply Chain to Financial Results (The webcast will be on Tuesday, December 11th, 2007 and I’m sure that it will be available for replay – I hope!) The presenters are DK Singh (Conagra), Dr. Stephen Timme (Georgia Institute of Technology) and Fred Haubold (SAS). And the webcast is about:

explores a proven three-step methodology for improving your financial performance through better managed supply chain business processes like forecasting, procurement, quality,service and call centers.

And the three-step methodology takes the shape:

    • Step 1: Establish benchmarks for key SCM-related financial metrics and the value of gaps calculated. The values of the gaps are an effective means to identify areas of opportunities and communicate the need for change.
    • Step 2: Link gaps in financial metrics to SCM-related business processes, activities and tasks, and key performance indicators. This provides a better understanding of the cause-and-effect relationships between SCM and financial performance.
    • Step 3: Use the information provided in steps 1 and 2 as the foundation for exploring and prioritizing SCM initiatives like improved forecasting, procurement and service.

And the presenters promise to use a case study to walk us through it.

Pencil it in! Should be fun.

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Book Review: Supply Chain Excellence

Supply Chain Excellence – A Handbook for Dramatic Improvement Using the SCOR Model is a worthy effort by Peter Bolstorff and Robert Rosenbaum published by American Management Association (AMACOM).

At the end of this book review, I want to drive towards clear answers for the following questions and/or headings. As I review more books, hopefully, I will expand the following questions into some sort of template against which future books would be reviewed.

1. What this book is about – what are its aims?

If I were to ably classify this book, I would slot it in the category of a Map. I have classified it as a map because it is written to help you navigate the challenge of structuring supply chain management inside and outside your firm. The two authors, Mr. Bolstorff who is a SCM consultant and Mr. Rosenbaum who is a journalist, have laid out a path using the SCOR (Supply Chain Operations Reference) Model as the framework within which your supply chain can be evaluated, planned and executed. It would be a truism to say that various firms are situated somewhere along that path to excellence, the achievement and realization of the said state is unknowable, ephemeral if achieved and the mine upon which careers are built or wasted – such is the life of business.

Rather than deal with such matters of philosophy or digging deeper into what excellence really means or the like, the task at hand is to begin that project – to make a stab at Supply Chain Excellence. And the authors have a 17 week plan to get you started. While I have my sweet suspicions of the 10 step program or for that matter the 17 week project (that’s still over 4 months of work), the plan is a tight one with meetings, homework, templates, samples of charts, tables and tasks and more. In order to give users of this book/guide a context for the required changes and a backdrop for the challenge itself, an imaginary Fowler’s Inc. has been conceived and employed which is a useful device as well.

So the aims as spelt out by the authors themselves:

a. The book is meant to be a manual for anybody (specifically for someone who wants to make sure supply chain improvement is done right) who seeks a rigorous and proven methodology for systematic supply chain improvements.

b. As a working guide for using SCOR as a tool to help senior managers at every step of undertaking supply chain initiatives.

2. Who this book is for?

My take on this topic is – If you’re not in the Steering Team (which not only comprises the power players but also members of the design and project team), chances are that this book will only be good review of how the SCOR model meets the road of implementation and execution. Which is a shame, all said and done from multiple points of view. A steering team typically consists of the few – no doubts about this. Say you are a marketer – would you prefer to market a commodity such as a book to the few or the many? Sure, it is the few (in the steering team and above) who have to take decisions at the end of the day and that is what a lot of this book is about i.e. how to create that sort of a methodology based (SCOR) supply chain improvement plan and execute it. The authors have done an excellent job of writing effectively to and for this group. But what about the many – those who will actually participate and implement this new plan, who will form the links for feedback on how well the plan is working – why and why not?

3. Does the book succeed in its aims?

I believe that in one of its principal aims – that of being a working guide for using SCOR by senior managers, this book succeeds a great deal. Laying out a four month plan is a very short time to get down the path of supply chain improvement and I do wonder if this is a realistic goal as well. However, what I would think about doing is to take a look at the cycle of activities that forms the normal quarter to quarter cycle within a firm and adjust the timelines accordingly. So, while they hit one of their aims above (b) nice and square, they do miss out on a good chunk of (a) and thus also a significant market for this book. Can anyone say companion book to this one?

4. A summary of my thoughts about the book

There is a host of valuable insights about how to make this sort of change happen within an organization and the fact that one of the authors is a consultant who has considerable related experience under his belt contributes to this mine of insights. But as I have said above, this is a map and there are several maps out there not only in the area of supply chain excellence but also in the area of change management and the like. The benefit that is readily observable to me is that over the project period, a structure and ordering of activities is presented which should be mined for insights. Moreover, a set of templates associated with the structure and activities is also available for modification and adaptation.

Read the rest of this entry »

Forecast less and get better results

Forecast less and get better results is a freely downloadable report made available by SupplyChain.com (HT: Jeff Ashcroft @ SupplyChainNetwork.com) which explores the scope and granularity of forecasting as should be adopted by firms. Their basic proposition is:

Our position is that, in most cases, this is not necessary. Rather, detailed forecasts and plans are normally needed only inside of what

A useful Lean and Six Sigma Resource

Manufacturing-Trends is making available a host of free resources (free signup may be required) for your consumption. They are in the form of powerpoint presentations that delve into a myriad set of issues surrounding Lean and Six Sigma. They’ll be well worth your while.

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A Supply Chain Probably works like this?

A Supply Chain would look a whole lot more complicated that this ad for the new Honda Accord. However, I don’t think that you’d get a fraction of an increase in your budget (In order to make this ad, it cost $6 million dollars over 3 months) for something that has to do with your supply chain even if you spent the next 3 months fine tuning a bunch of processes and saving a whole lot of dough in the process. Just what is wrong with this picture?

More about the ad.

Supply Chainers of the world, Unite; Now about my budget for next year?

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Useful SCM Resources – Time to plug in!!

I think that I should take the time to post about useful (and in some cases – very useful) supply chain management resources. And here is one that I subscribe to myself – Supply Chain Digest Letter on specific resources. Choose the one that most fits your palate and get them delivered to your home (free the last time I checked).

The other very useful resource that you may or may not have with you is to get yourself armed with an RSS feed reader. There are several of them that might appeal to you and depending on your OS and choice of browser, the offerings vary. Here’s a top-10 list for RSS readers (among the several that you may find). The reason that subscribing to feeds is important is simply that it plugs you in – into the conversations that are taking place, some connected and some tangential in the supply chain world. They way I would describe it is that it is the Bulletin Board/Forum idea, abstracted one level higher in a very loose sense.

Of course, the small voice in me asks that you might be gracious enough to subscribe to my blog as well. Meanwhile, I am preparing a review for a book that I received in the mail bag – Supply Chain Excellence: A Handbook for Dramatic Improvement Using the SCOR Model. It’s been a good read so far and I should have the review up in a few days.

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Achieving World-Class Supply Chain Collaboration: Managing the Transformation

Achieving World-Class Supply Chain Collaboration: Managing the Transformation is a new report available from CAPS Research (free registration required) published by authors – Stanley Fawcett (BYU), Gregory Magnan (Seattle U) and Jeffrey Ogden (Airforce Inst of Tech). First off, this report is a research oriented report and so it is a virtual gold mine of possibilities. But also of dead- ends and the difference between them are not readily apparent all the time.

In the preface of the report, the authors note that,

"but the world has also, literally, become a more dangerous and risky place in which to do business. Today’s global supply chains are only one terrorist attack, one bird flu pandemic or one not-yet-envisioned threat away from disruption and potential chaos."

These threats in the past would never have affected supply chains of the past. This is not to say that there has not been global trade going on which has been going on for centuries. However, there has been a shift in the sense that the decision to source globally is not only from a point of availability but also from the point of price and value added (i.e. a lot of firms believe that outsourcing/offshoring non-value added activities is a good business decision). One wonders here whether in that non value added determination, whether it was deemed necessary to couple that determination with supply risk. Regardless, we’re well down that path and now we get to face both the pleasures and perils of that commitment.

The irony of change however is well noted by the authors,

Companies have struggled for years to learn how to integrate processes within their own four walls – most still do not! Learning how to build a collaborative team of companies in a world motivated by short-term financial results is a far more daunting task.

So why then the focus on collaboration than making the global supply chain a better one? Well, I guess that’s what the authors wanted to do but I’d have thought that these global supply chains have not yet had the time to settle down before the effort to tack on collaboration enters the picture. Perhaps, the global distribution of participants and stakeholders in the supply chain makes it important but one wonders when collaboration made little headway in the laboratory of the domestic supply chain, one wonders the risks of taking on the challenge globally.

Go on, read the report and see what nuggets you find!!

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About me

I am Chris Jacob Abraham and I live, work and blog from Newburgh, New York. I work for IBM as a Senior consultant in the Fab PowerOps group that works around the issue of detailed Fab (semiconductor fab) level scheduling on a continual basis. My erstwhile company ILOG was recently acquired by IBM and I've joined the Industry Solutions Group there.

@ SCM Clustrmap

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