By Sid Powar | Supply Chain COE Director
Last week I was out on the trails here in Colorado with my two boys biking and I was explaining to them the importance of collaboration and how to work effectively and efficiently in teams.
I explained how in order to deal with the Covid crisis the doctors, nurses and support staff had to work lock step to ensure they worked together to help sick patients recover as quickly as possible. Along with them, the government had to ensure they did their part of providing the essential supplies such as N95 masks and ventilators to the Hospitals. Regular people, like us had to observe the lockdown rules to help flatten the curve for hospitalizations and help control the spread of the virus. At age 7 and 5, I think they are pretty smart and caught onto the fact that working together can help us do amazing things!
The spread of the virus globally brought entire supply chains to a grinding halt. Lots of blame and pointing fingers continues as to what could have been done to help avoid the pandemic. Hindsight is 20-20!
What can we do as individuals or corporations to avoid something like this in the future? I’m not an expert on Public or International Policy, but I am an expert in supply chain management and I strongly recommend Connected Planning as a transformational strategy.
The best approach to Connected Planning is for the company to spend time and invest in workshops that take a specific part of the supply chain planning process such as forecasting, supplier relationship management, transportation, sales quota planning etc. to tackle the gaps in processes.
The workshops should have clear goals to identify SIPOC:
S = Supplier of information (eg: Sales department)
I = Input of information to be sent by upstream department (eg: Sales projections for Q3 2020)
P = Process to share information (eg: using email or shared folder or Anaplan)
O = Output or information to be created from inputs received (eg: consensus demand)
C = Customer for the information to downstream department (eg: Demand Planning team)
WHO SHOULD ATTEND THESE WORKSHOPS?
The leadership team such as COO or CSCO (Chief Supply Chain Officer) and CFO should provide support and commitment needed to tackle Connected Planning. While Connected Planning is a simple concept it is very hard to implement in organizations for a variety of reasons. Leadership commitment can make resources available to ensure success. The next group that should attend is the Department Leadership such as Procurement Leader or VP Sales.
The workshop should finally include the Subject Matter Experts that know the processes inside out and the constraints they are bound by. The workshop should also include a commitment to Trust, Openness to Criticism, Change and Reward for successful Connected Planning (eg: celebratory party at end of implementation not just the workshop!)
SCORECARD & METRICS
The performance of Connected Planning can be tracked using some standard metrics and keeping a scorecard to ensure successful partnerships. The goal is never to point fingers, but reassess the connected processes for points of failure (note: Not people but processes).
To measure how effectively and efficiently Sales and Supply Chain are working together, KPIs such as sales Revenue vs. Target, DIFOT (Delivery in Full on Time), Inventory Levels vs. target can be measured and shared. If Sales is always overshooting their target and supply chain is always expediting, the problem is pretty obvious. The scorecard can help bring this topic to the forefront for discussion ad improve Connected Planning between the two groups by allowing for proactive actions by the teams such as more safety stock levels for Supply Chain to manage the demand volatility or for Sales to reduce forecast error by early sharing of Sales promotions or adjusting demand by price elasticity. The key is to track the KPIs that do not meet goal and documenting the reasons for the gaps along with any time lost or costs associated with it.
You can apply the same principles to help other groups become Connected Planning evangelists. If the world can learn an important lesson from COVID-19 it’s that we are all “Connected” and we need to work together and “Plan” better in order to build successful organizations and relationships.