The Journey of Supply Chain Excellence

You’ll note in the headline I use the preposition “of” instead of “to” when describing the “journey of Supply Chain Excellence.” The significance of this wording is that the journey doesn’t have an implied end or completion. Successful supply chain practitioners always seek opportunities to improve, understand the competitive and regulatory environments are fluid, and improvements in process, policy, practice, performance measures, and technology will continue to present themselves. In response, the organization can choose to be proactive or reactive.

The key objective for the majority of companies I work with is to significantly improve their supply chain capabilities and performance. While this is a common objective across organizations, the manner in which they treat this process ultimately defines the magnitude of their long-term success. The differentiator is whether Supply Chain Excellence is defined as a one-time project or as on ongoing process.

The implementation of a new supply chain solution is an important step toward realizing Supply Chain Excellence. The effort is always conducted within the context of a project since that effort is significantly different from the day-to-day activities performed by the impacted organization. Implementers of supply chain solutions recognize that projects must have a well-defined scope, and that care must be taken to manage that scope in the interest of time and resources (both capital and talent). By that definition, a project must also have a definitive end or “destination”. The implementation of a supply chain solution is one milestone on a more significant journey towards ongoing improvement. Companies that understand and follow a continuous improvement mindset will see the journey of Supply Chain Excellence continues well after the celebration of a successful project Go-Live has faded from memory.

For those that settle for being reactive, the extent to which they delay their response may result in finding themselves in a position where they are no longer relevant. Take the case of consumer electronics in retail and consider how Amazon has changed the rules of the game. Circuit City failed to adapt and is now history. Best Buy is in the process of redefining itself as an “omni-channel” retailer in order to compete online while simultaneously leveraging the instant gratification their physical locations provide. All the while, Amazon continues to work on improving their supply chain capabilities; seemingly moving the target with increasing speed.

Amazon is already able to deliver most items by the next day and in some markets the same day. Despite what would seem to be a compelling example of Supply Chain Excellence, Amazon never ceases to work on continuously improving their ability to service customers. This is part of their corporate culture and is ingrained in the company.

So how do you develop an organizational mindset that pursues the journey; one that doesn’t see the implementation of a supply chain solution as an end goal? There are several steps can take. Some can be done immediately while others may require developing your organizational maturity.