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CIPS Australia 3rd Annual Conference
People powering contemporary high-performance supply chains
byProf. John Gattorna
Sydney – October 2007
1
Materials
Information
Suppliers Manufacturers Retailers/Distributors
Inboundlogistics
Internaloperations
Outboundlogistics
Narrow focus oftraditional logistics
Broad focus ofintegrated supply
chain management
CustomerDemands(by segment)
Externalinterfaces
Internalinterfaces
Figure 1.1: Operationalizing the concept of supply chains
Note: All figures referenced in this presentation refer to figure numbers in Living Supply Chains ( Gattorna, 2006 )
Fact, like it or not: all enterprises have multiple supply chains running through them
2
Supply Chains as Human Systems
Products and Services only move through supply chains as a result of human decision – making
On the outside: It is customers who decide to buy, and how ( Buying Behaviour)
On the inside: It is employees, management, and Boards who decide how to respond ( Cultural )
... everything else are simply enablers ( Technology, Processes, KPIs, Incentives, etc)
3
Adapted from Figure 1.2: Elements of the ‘dynamic alignment’ framework
What is needed is an over-arching organizational concept to inform the design and management of supply chains
4
Aligning for success – 4000m pursuit, Athens ‘04 5
A common metric is essential to compare and assess the degree of ‘alignment’ across the 4 levels
Figure 1.3: General characteristics of the four dominant behavioral forces or logics
Source: Adapted from Figure 29.2 in Gattorna (1998)
BehavioralForces
Force for cohesion co-operation and relationships
Force for creativity change and flexibility
Force for analysis, systems and
control
Force for energy action and results
‘Feelin
g’
‘Sensing’
‘Intuition’
‘Thinking’
I D
PA
Integration Development
ProducerAdministration
6
This will lead us to a new ‘service-cost’ paradigmbased on ‘alignment’ – the old one is flawed
Figure 1.9: Paradigm shift to a best-of-both-worlds strategy
Source: Adapted from Figure 1.1.1 in Gattorna ( 2003)
Time
Cost
Logistics Cost (% of Sales)
Logistics Cost (% of Sales)
CustomerSatisfaction
(%)
CustomerSatisfaction
(%)
Time
Traditional Paradigm New Paradigm
Satisfaction
7
Figure 1.10: Primary customer service logics
‘Customer service’ means different thingsto different customers
(I) (D)
(A) (P)
UNDERSTAND ME SURPRISE
BECONSISTENT RESPOND
Customer Service = Reliability,
Predictability, Consistency
Customer Service = Responsiveness
in a commercial way
Customer Service = Empathy,
Understanding, Relationship
Customer Service = Innovative, Creative response to unique
needs
• Integration• Mature – imminent change??• Loyalty and long-term relationships• Brand loyalty• “Joint Venture” mentality• “Quality” emphasis• Teamwork• Consensus
• Early / young market• No clear patterns / traditions yet to be
established• New product / technology• High level R&D (eg. CDs)• Supplier-led risk• Entrepreneurial• Lower price sensitivity
• Stable market, patterns are established• Commodity• Drive for efficiency – “experience” culture• Value for money• High price sensitivity• Procedural• Standards• Structure
• Patterns emerge - growth• Customer led demand• Sales, promotion, distribution important• Strong commercial attitude – anti-
relationship (eg. price sensitive); opposite to loyalty
• “Hollywood” syndrome – only as good as your last performance
• Product differentiation
8
Source: Adapted from fieldwork at Fonterra, 2001
Figure 2.2: Four (4) most common dominant buying behaviors
You must identify the dominant buying behaviours evident in your marketplace –normally 3 or 4 at most
Collaborative Efficient Dynamic (QR) Innovative Solutions
Mostly predictableRegular deliveryMature or augmented productsPrimary source of supplyTrusting relationshipTeamwork/partnershipInformation sharingJoint developmentForgivingPrice not an issue
Predictable demand within contractRegular deliveryEfficiency low cost focusMultiple sources of supplyLittle sharing of informationMore adversarialStandard processesPower imposedTransactionalVery price sensitive
Unpredictable demandCommodity relationshipTime priority/urgencyOpportunity focusAd hoc source of supplyLow loyalty, impersonalFewer processesOutcome orientedCommercial deals based on pragmatismPrice aware
Very unpredictable demandHigher riskFlexible delivery responseInnovation focusRapid changeIndividual decision makingSolutions orientedManagement of IPIncentives/egoNo price sensitivity
Close workingrelationships for
mutual gain
Consistent low cost response to largely
predictable demands
Rapid response to unpredictable supply
and demand conditions
Supplier-led development and
delivery of new ideas
Ia A Pa Dp
9
Figure 2.1: ‘Multiple Supply Chain Alignment’ on the customer side
You must identify the dominant buying behaviours evident in your marketplace –normally 3 or 4 at most
“User Segmentation”
“Service propositions”
The identified dominant buying behaviours in the user/consumer base
The portfolio of different service strategies designed to respond to identified buying behaviours
The distinctly different sub-cultures required to underpin the corresponding service propositions
“Internal Capabilities”
“Shape & create”The different leadership styles that are required to shape the corresponding sub-cultures
User Markets
Strategy
Cultural Capability
Leadership Styles
Leader-ship
Org../Process
ServicePropos.
Needs
Leader-ship
Org. /Process
ServicePropos.
Needs
Leader-ship
Org./Process
ServicePropos.
Needs
Leader-ship
Org./Process
ServicePropos.
Needs
10
Figure 2.3: Four (4) Generic supply chain types
Four (4) generic supply chains have been identified – and variations of these may exist
Rel
atio
nshi
p w
ith c
usto
mer
Predictability of demand
“Continuous Replenishment”
“Lean”
Loose
TightHigh Low
Predictable demand, easily managed through tight collaboration with customers. Focus on retention of customer relationships.
Demand predicable, (e.g. from historic off-take), but the loose relationship does not necessitate an extreme service level. Focus on efficiency.
Respond opportunistically & manage yield. Focus on providing creative solutions for premium price.
Unplanned or unforeseen demand, and a sometimes loose relationship with customers - almost always demands an agile response at higher cost-to-serve. Focus on the service-cost equation
“Fully Flexible”
“Agile”
11
Figure 2.4: Flow types and matching supply chain types
These 4 supply chains co-exist, like laminar flow in a pipeline, and have to be de-constructedfor clarity
12
*Segment names selected by Foster’s
Figure 2.6: Foster’s new behavioural-based segmentation in Australian beverage industry
Small volumesDifficult delivery locationsMerchandising supportLimited spaceTight financeStable demandCertainty of SupplyRegular ordersPrice sensitiveRelationship important
Large volumesStanding ordersStraight forward regular deliveriesRelatively high stock levelsPrice sensitiveAppropriate promotions
Small volumesSome unpredictable in demandRegular ordersDifficult delivery locationsPack presentation importantPremium/value-addsPrice awareVariety important
Small volumesSpecial solutionsSpecific delivery arrangementsCreative sales and logistics arrangementsSmall volumesValue-for-money
eg., Small & remote customers; not buying direct
eg., Fine dining restaurants; casinos; resorts; theme parks; 5-star hotels
ILLUSTRATIVE
eg., suburban hotels, and bottle shops
eg., Major retailers; CML; Woolworths
13
Figure 2.7: The three (3) different supply chains at Coca-Cola Japan
Delivering Coca Cola in three (3) different ways
ILLUSTRATIVE
14
Appendix 2B: Multiple Supply Chains in the Healthcare Industry
Multiple supply chains in the Healthcare Industry
WARDS
Theatres Radiology
Labs
Pathology
Stores KitchenOffice
Engineering
DirectLarge Volumes
LeanSupply Chain
A
FlexibleDeliveries
(Mixed)
AgileSupply Chain
Pa
Direct DeliveriesSmall & Frequent
CollaborativeSupply Chain
Scheduled DeliveriesMajor Items
Fair DealSupply Chain
Pharmaceuticals MedicalSupplies Food Domestic
Supplies Maintenance CapitalEquipment
aI
A
i
SupplierWarehouses
WholesalerCross-Docking
15
Appendix 2B: Multiple supply chains in processed food manufacturer Goodman Fielder
…and in a fmcg conglomerate
Fresh Daily(Supermarkets,small retail and
McDonalds
A Pap
DA
i
Flow Flexibility Fresh Bulk
SupermarketDCÕs
Fast Food ChainsFood service distributors
Food processorsSmall Industrial
Bulk Industrial
Uncle Tobys Meadow Lea Milling & Baking ÉÉÉÉÉÉÉ ..
Business Units Õ Factories
ILLUSTRATIVE
16
Figure 2.10: Logistics network optimization at major New Zealand Pulp & Paper Manufacturer
The ultimate solution is a logistics network optimization model aligned to major customer & supplier segments
Suppliers
Suppliers
Mill
Mill
Mill Distribution
Centre
Mill Distribution
Centre
Distribution Centre
Distribution Centre
Markets
Markets
Interfacility Transport
Inbound Transport
Outbound Transport
Raw Material Finished ProductIntermediate Product
MODELING VARIOUS COST-SERVICE SCENARIOS
17
Source: Adapted from Figure 3.5.2 Gattorna (2003)
Figure 2.11: Supply side alignment, the mirror image of the customer side
Supply-side and demand-side alignments are the mirror-image of each other
CUSTOMERMARKET
SUPPLIERMARKET
Reverse Alignment
Forward Alignment
Enterprise
Supplier Behaviours• Trusted & reliable partners• Planned creativity• Process driven• Opportunistic
SC Strategies• Continuous replenishment• Lean• Agile• Fully flexible
Buyer Behaviours• Collaborative• Efficiency/consistency• Demanding/quick response• Innovative solutions
Procurement Strategies• JIT Replenishment• Scenario• Transactional• Volatile
Cultural Capabilities• Group• Hierarchical• Rational• Entrepreneurial
Leadership Styles• Coach• Traditional• Company Baron• Visionary
18
Executing a multiple supply chain strategy:working together with people to deliver the
required responsiveness
19
Source: Adapted from Figure 4.3.3 in Gattorna (2003)
Figure 3.1: The ‘performance’ iceberg
Understanding the power of unseen cultural forces
VISIBLECONSCIOUS
INVISIBLEUNCONSCIOUS
UNDERLYING ASSUMPTIONS� Taken for granted assumptions about the organisational reality
VALUES AND BELIEFS� Goals of the enterprise� Means used to accomplish these goals
VISIBLE PATTERNS OF BEHAVIOUR� Structure� Strategy� Systems
20
Source: Adapted from Figure 4.3.5 in Gattorna (2003)
Figure 3.2: The four (4) generic enterprise sub-cultures
4 basic types of sub-culture exist, and various combinations are possible
Means: Synergy, teamwork,co-operation
Ends: Cohesion
Means: Innovation, flexibility,readiness
Ends: Growth
Means: Systems,measurements,controls
Ends: Order
Means: Action, objectives,energy
Ends: Results
Group Entrepreneurial
RationalHierarchical
IndirectControlI
A
D
PDirectControl
InternalFocus
ExternalFocus
21
Figure 3.3: Details of each sub-culture
Emphasis on cohesion, teamwork, synergy and consensus.
• Closed informal communication which is shared by way of cliques and membership of an “inner circle”
• Control achieved by commitment to Common Values• Management support emphasises the internal climate
and environment• Individual’s tasks are negotiated by consensus• Rewards are based on informal standards and the
ability to maintain internal cohesion – good team players
• Deviant behaviour is tolerated – provided it adheres to consensus values
Group Culture Entrepreneurial CultureEmphasis on individualism, creativity, fast
response.• Open informal communication which is shared with
whoever happens to be around at the time• Control achieved by commitment to a common
vision• Management support emphasises leading and
inspiring• Individuals are empowered to perform their roles• Rewards are based on creativity and
entrepreneurial behaviour• Deviant behaviour is tolerated – provided it is goal
directed
Emphasis on order, stability, information and control.
• Closed, formal communication which is shared only on a “need to know basis”
• Control achieved by focus on processes• Management support emphasises procedures• Individual’s tasks are established by precedence• Rewards are based on formal standards and the
ability to maintain internal cohesion – good administration
• No deviation from approved processes
Hierarchical Culture
Emphasis on analysis, guidelines and sustained high levels of activity.
• Open formal communication by way of committees and memoranda
• Control achieved by focus on results• Management support emphasises planning• Individuals are given structural authority to perform
their roles• Rewards are based on formal standards and
relevant results – analysis and action• No deviation from plans or performance standards
Rational Culture
22
Source: Adapted from Hofstede (1980)
Fig 3.6: National Country Values
If you operate overseas, the respective Country culturesoverlay company cultures (1) – and modify behavior
LowPower
Distance
HighPower
Distance
CollectiveOrientation
IndividualOrientation
SouthAfrica Italy
Spain
Belgium
France
Austria Israel Denmark
New Zealand Great Britain
Australia
USACanada Germany
Norway
Finland
Taiwan
Greece Japan Thailand
Turkey Brazil
IndiaMexico
Singapore
Hong Kong
A
I D
P
23
Source: Adapted from Hofstede (1980)
Fig 3.7: National Country Values
Country cultures overlay company cultures (2) – and modify behavior
Feminine
Masculine
UncertaintyAvoiding
UncertaintyAcceptingCanada
India
New ZealandUSA
Australia
Singapore
Netherlands
NorwayDenmark
Sweden
BelgiumSwitzerland
Germany
Japan
Italy
Portugal ThailandFinland
Taiwan
Hong Kong
Great BritainSouth Africa
A
I D
P
24
Leading from the front:converting customer
insight into successful operational execution
25
Figure 4.2: Leadership styles
In successful organizations, the leadership (at all levels) is always in close touch with customers
ThinkingI
A
D
PDoing
Consensus Individual
COACHContinue to:Lead by teachingMake decisions by consensusGet the best from people
Watch out for:Slow response to suddenenvironmental changeMarket-related performance
VISIONARYContinue to:Lead by inspirationRespond to turbulenceUse information to create change
Watch out for:Tangential interestsShort on the detailPeople policiesInefficient response to opportunities
COMPANY BARONTRADITIONALISTContinue to:Lead by procedureUse information to maintain controlImplement proven business tactics
Watch out for:Inability to respond toenvironmental changeEfficiency at the expense ofeffectiveness
Continue to:Lead by objectivesFocus on whatÕs importantPlan for future profitability
Watch out for:Paralysis by analysisPolitical in-fightingEffectiveness beforeefficiency
26
Continuous Replenishmentsupply chains:
where relationships matter most
27
Continuous Replenishment supply chains –demand side
…where relationships matter most
Coach• Conscientious• Leads by teaching• Concerned for others• Loyal; committed; politically astute• Seeks agreement by consensus
Group sub-culture• Relationship ‘cluster’• Standard processes, eg. Customer Account Management• CRM;SRM;VMI;ECR;CDP;CPFR• Emphasis on loyalty and retention• Encourage participative schemes• Authority/autonomy negotiated by consensus• Consultative; face-to-face• Team building• Recruit team players
• Share information• Strategic partnerships• Long term stability• Mutual trust
Cultural Capability• O.D• Process• IT• KPIs• Incentives• Job Design• Internal Coms.• T & D• Recruitment
Collaboration Zone
Value Proposition
Focus
Leadership Style
Close relationship with selected customers
28
Continuous Replenishment supply chains clusters, focused on loyal high-value customers
Account Teams/clusters configured with a ‘Relationship’ mindset bias
Note: Individual team members return to their respective Functions for training and other specialist matters
FUNCTIONS
Customer A
Procurement Production Finance Sales/Mktg Logistics
CEO
Customer B
Customer C
P
PL
FS/M
P
P
LF
S/M
P
PL
FS/M
I
a
COO
29
Lean supply chains: Focusing on efficiency and
lowest cost-to-serve
30
Lean supply chains – demand side
…focusing on efficiency and lowest cost-to-serve
Traditional• Leads by procedure; precedents essential• Implements proven business practices• Cost controller; efficiency focus• Uses information to control• Seeks stability • Risk averse
Hierarchical sub-culture• Organize clusters around core processes• Standard processes; emphasis on cost• L-T capital investment in ERP & other IT systems• DIFOTEF; forecast accuracy; productivity ratios;• Conformance to policies• Centralized control – rules and regulations apply• Regular; structured; on ‘need to know’ basis• Emphasis on analysis and measurement• Recruit players with analytical skills
• Seek economies of scale• Low cost production & distribution• Forecast demand; mature products;
predictable lead-times
Cultural Capability• O.D• Process• IT• KPIs• Incentives• Job Design• Internal Coms.• T & D• Recruitment
Value Proposition
Focus
Leadership Style
High volume; Low variety; Low costs; MTF
31
Lean supply chain clusters focused on key processes that drive efficiency and routine for price sensitive customers
PM = Process Manager Process teams configured with a cost improvement bias
Note: Individual team members return to their respective Functions for training and other specialist matters
FUNCTIONS
Procurement Production Finance Sales/Mktg Logistics
CEO
PM
PL
FS/M
P
PM
LF
S/M
PM
PL
FS/M
FULFILMENT
ORDER MGT
SOURCING
A
PriceSensitive
Customers
COO
32
Agile supply chains:where quick response
is paramount
33
Agile supply chains – demand side
…where quick response is paramount
Company Baron• Leads by objectives• Embraces change• Goes for growth• Focuses on what’s important• Analytical; fact-based solutions
Rational sub-culture• Clusters designed for speed and focused on specific sub-
segments• Process short-cuts; fast response• Applications: Postponement; SCP; APS; Network Models;• Absolute speed of response• Achieve targets; cash and in-kind bonuses• Authority /Autonomy established by clear and published limits• Formal; regular; action-oriented• Problem-solving; resource management• Recruit personnel who are results- driven
• Fast decision-making• Fast delivery• Rapid response in unpredictable conditions
Cultural Capability• O.D• Process• IT• KPIs• Incentives• Job Design• Internal Coms.• T & D• Recruitment
Value Proposition
Focus
Leadership Style
Manage the enterprise for responsiveness; quick reaction ; MTO
34
Agile supply chain clusters designed to react fast to demanding customers in volatile markets
Clusters are focused on different parts of the same segment but possibly different product categories
Note: Individual team members return to their respective Functions for training and other specialist matters
FUNCTIONS
Procurement Production Finance Sales/Mktg Logistics
CEO
a P
a P
a P
Sub-sets ofDemandingcustomersegment
P
P
LF
S/M
P
P
L
FS/M
P
P
L
FS/M
COO
35
Example of an Agile organization 36
Fully Flexible supply chains: where nothing
is impossible
37
Lean supply chains – demand side
…where nothing is impossible
Visionary• Leads by inspiration; authentic• Informal• Decisive• Cares about ideas• Values innovation
Entrepreneurial• Small multi-disciplinary cluster, usually on standby• No standard processes; use local initiative at the time• Low systems requirements; event management appls.• Emphasis on finding creative solutions, very fast• Reward individualism & risk-taking behaviour• Autonomy through empowerment• Spontaneous and informal• Lateral thinking; brainstorming• Recruit enterprising, resourceful personnel
• Meet unplanned/unplannable demand• Innovative solutions, delivered fast
Cultural Capability• O.D• Process• IT• KPIs• Incentives• Job Design• Internal Coms.• T & D• Recruitment
Value Proposition
Focus
Leadership Style
Hedge and deploy resources
38
Fully Flexible supply chain cluster with embedded capacity to deliver innovative solutions to desperate customers, fast
FUNCTIONS
Procurement Production Finance Sales/Mktg Logistics
CEO
Focus is on single events/emergencies at any one timeD
p
Single cluster made up ofmulti- disciplinary, multi-tasking,multi-talented individuals
P
P
L
F
S/M
SpecialServices
Desk (SSD)
39
Hybrid Supply ChainCombinations in Practice
40
Multiple combinations of supply-side and demand-side elements of enterprise supply chains
CustomerBuying Logics
D
p
Pa
A
�I
aa
D
p
Pa
A
�I
aa
SupplierSelling Logics
Decoupling Pointat Enterprise
Supply-side Customer-side
VOLATILE * (Fully Flexible)
JUST-IN-TIME *REPLENISHMENT
(Continuous replenishment)
SCENARIO * (Agile)
TRANSACTIONAL * (Lean )
FULLY FLEXIBLE
AGILE
LEAN
CONTINUOUS REPLENISHMENT
EXAMPLES
GENERAL PARTSEGGED BUS COMPANY
1
2
12
•Different names for supply-side component
Figure 8.4: Mixed Supply Chain Logics
41
Zara’s design brings fashion to market, fast
1. Zara stores aredigitally linked toheadquarters; employeescollect and share inputfrom customers daily
2. Zara designerssketch new stylesbased on customerinput and “hot spot ”trends
6. One distribution centre dispatches product to stores twice weekly
3. Textiles aresourced fromglobalsuppliers
4. Zara’s parentperforms thecapital-intensiveproductionactivities
5. Local workshopsperform finalsewing/assembly
1
24
5
Partners
Zara
Customersare young
fashionableprofessionals
6
3
Information flows
Product flows
Source : Mercer Management Consulting
42
Multiple supply chain alignment in the Australianconstruction materials market
Source: Carpenter Ellis
Figure 6.4 Resultant Metropolitan Distribution Network
COMMERCIALPROJECT
COMMERCIALSUPPORT
RESIDENTIALPROJECT
RESIDENTIALSUPPORTDISTRIBUTOR
TRADE CENTRE
PICK CENTRE
DISTRIBUTIONCENTRE
Focused service offer and tailored operations to achieve alignment
Logic: A
Logic: Pa
Logic: Ia I
a
A
Pa
43
It all boils down to the ultimate challenge of managing different combinations of organizational configurations, co-incidentally
Multiple organization formats within an enterprise
Cont. Repl. Cluster� Emphasis on balancing the interests
of both function and customer
� High levels of communication and
collaboration.
� Best for medium-sized companies.
� Dual authority and reporting.
Lean Cluster� Employees organized around core
processes.
� Team-work is promoted for more
efficient delivery of services.
� Uses cross-functional teams and
processes.
� Sharing responsibilities and
decisions by promoting team-work.
Agile Cluster� Suitable for rapid response.
� Focus on the core competences
required.
� Decentralized.
� Small companies can use each
othersÕ capabilities and resources.
� May be virtual
� Highly collaborative culture buy
allows individual flair.
F/Flexible Cluster� Consists primarily of small teams of
specialists .
� Permanent or temporary teams.
� Emphasis on innovation and
problem-solving.
� Loose structure with no hierarchy.
� Power balance, highly cooperative
and contributive culture
FUNCTIONS
Customer A
Procurement Production Finance Sales/ Mktg Logistics
CEO
Customer B
Customer C
P
PL
FS/M
P
P
LF
S/M
P
PL
FS/M
Account Teams configured with a ŌRelationship Õbias
Note: Individual team members return to their respective Functions for training and other specialist matters
I
a
COO
FUNCTIONS
Customer A
ProcurementProcurement ProductionProduction FinanceFinance Sales/ MktgSales/ Mktg LogisticsLogistics
CEO
Customer B
Customer C
P
PL
FS/M
P
P
LF
S/M
P
PL
FS/M
Account Teams configured with a ŌRelationship Õbias
Note: Individual team members return to their respective Functions for training and other specialist matters
I
a
COO
FUNCTIONS
Procurement Production Finance Sales/ Mktg Logistics
CEO
PM
PL
FS/M
P
PM
L
FS/M
PM
PL
FS/M
PM = Process Manager Process teams configured with a cost improvement bias
Note: Individual team members return to their respective Functions for training and other specialist matters
FULFILMENT
ORDER MGT
SOURCING
A
Price Sensitive
Customers
COO
FUNCTIONS
ProcurementProcurement ProductionProduction FinanceFinance Sales/ MktgSales/ Mktg LogisticsLogistics
CEO
PM
PL
FS/M
P
PM
L
FS/M
P
PM
L
FS/M
PM
PL
FS/M
PM = Process Manager Process teams configured with a cost improvement bias
Note: Individual team members return to their respective Functions for training and other specialist matters
FULFILMENT
ORDER MGT
SOURCING
AA
Price Sensitive
Customers
COO
FUNCTIONS
Procurement Production Finance Sales/ Mktg Logistics
CEO
Clusters are focused on different parts of the same segment but possibly different product categories
Note: Individual team members return to their respective Functions for training and other specialist matters
a P
a P
a P
Sub-sets of Demanding customer segment
P
P
L
FS/M
P
P
L
FS/M
P
P
L
FS/M
COO
FUNCTIONS
ProcurementProcurement ProductionProduction FinanceFinance Sales/ MktgSales/ Mktg LogisticsLogistics
CEO
Clusters are focused on different parts of the same segment but possibly different product categories
Note: Individual team members return to their respective Functions for training and other specialist matters
a Pa Pa P
a Pa Pa P
a Pa Pa P
Sub-sets of Demanding customer segment
P
P
L
FS/M
P
P
L
FS/M
P
P
L
FS/M
COO
FUNCTIONS
Procurement Production Finance Sales/ Mktg Logistics
CEO
Focus is on single events/emergencies at any one timeD
p
_ Single cluster made up of multi - disciplinary, multi -tasking, multi -talented individuals
P
P
L
F
S/M
Special Services Desk (SSD)
FUNCTIONS
Procurement Production Finance Sales/ Mktg Logistics
CEO
Focus is on single events/emergencies at any one timeD
p
_ Single cluster made up of multi - disciplinary, multi -tasking, multi -talented individuals
P
P
L
F
S/M
Special Services Desk (SSD)
44
A Final Word
Stay close to your customers; know their businesses inside out,and understand their patterns of demand (behavioral segmentation)
Make sure everyone in the company is working to the same customer demand data
Gear up to respond rapidly to the volatile (unpredictable) component of your customers’ demands
Recognize that you will simultaneously be part of multiple supply chains in and between your suppliers and customers
Organize your people in ways that mirror the demand patterns of your customers
Think ‘alignment’ at every point along the supply chains you participate in
Remember the future is about supply chains competing against each other; you should aim to be involved in only winning combinations
Continue to grow successfully in a volatile world by…..
Forecasting for capacity; and Executing to demand
45
Six (6) questions for you to consider…
1. Has your company/enterprise attempted to design/operate your supply chain network based on ‘alignment’ principles?
2. Has your company/enterprise used behavioral segmentation of customers to inform the design/operation of its supply chains?
3. Has your company consciously attempted to shape various sub-cultures to execute the different types of supply chains it has running through the business?
YES NO
YES NO
YES NO
46
Six (6) questions for you to consider… cont.
4. Does top management in your company treat logistics/supply chain management as a specialist ‘function’ or as an integral part of the business?
5. Do you think top management in your company understands the role culture plays in powering corporate supply chains?
6. If no, are they in denial?
YES NO
YES NO
YES NO
47
Dr. John GattornaBE, Melb., MBA, Monash, PhD., Cranfield
John Gattorna established and led Accenture’s supply chain practice in ANZ/Southern Asia for several years, and was one of the Firm’s most respected thought leaders. Previously, he operated his own consulting company, specializing in marketing, logistics, and channels strategy, servicing an international clientele. Indeed, John is generally regarded as a global ‘thought leader’ in the supply chain management space, and continues to be much sought after as a speaker on the international conference circuit.
John has authored/co-authored several books and numerous articles on marketing, marketing planning, pricing, customer service, channels strategy, logistics, and supply chain management. His latest book, Living Supply Chains: how to mobilize the enterprise around delivering what your customers want, was published by FT Prentice Hall in May 2006, and is written specifically for C-level executives in major global enterprises. A Chinese language edition is due in July 2007.
The Gower Handbook of Supply Chain Management (5th edn), published in 2003, is the definitive work on supply chain management theory and practice; rights to Chinese and Russian language editions have been granted, and the former was published in March 2004. His previous book co-authored with Andrew Berger, Supply Chain Cybermastery, was published at the height of the e-commerce boom in 2001, and has since been translated into Chinese. An earlier book, Strategic Supply Chain Alignment, published in 1998, was the first publication to bring a behavioural dimension to the task of building high-performance supply chains. This book has since been translated into both Japanese and Chinese.
Although John originally came from industry he has a strong academic pedigree having taught undergraduate, post-graduate, and executive programs at the University of New South Wales and Macquarie University in Sydney; Oxford and Cranfield universities in the UK; and Normandy Business School, Le Havre, France. He currently holds Visiting Professorships at Cranfield School of Management and Macquarie Graduate School of Managementand is Chairman of the Advisory Board, Institute of Logistics & Supply Chain Management, Victoria University in Melbourne.
In the early 1990s, John was one of the original co-developers of the “Alignment” concept, and since then has continued to research, develop, and apply this powerful framework to the design and management of enterprise supply chains. His work has evolved into the ‘Dynamic Alignment’ concept that he is currently applying to enterprise supply chains, globally.
Going forward, John intends to continue his research, teaching and writing in the supply chain space, and act as an independent adviser, mentor, coach, educator, thought leader, and point-of-view provider to C-level executives and Boards around the world.
e:[email protected] | w: www.johngattorna.com | t. +61 2 9956 5046 | 08/06/07
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Books authored and co-authored
Gattorna, John, Living Supply Chains: how to mobilize the enterprise around delivering what your customers want, Published by FT Prentice Hall, London, 2006. Go to www.pearson-books.comChinese language edition currently under preparation and due for publication late- 2007 by PHEI, BeijingGattorna, John (ed) (2003), Gower Handbook of Supply Chain Management, Aldershot: Gower PublishingChinese language edition published by Century-Wave Co./PHEI, Beijing in March 2004; Russian language edition to be released sooBerger, A.J. and Gattorna, J.L. (2001), Supply Chain Cybermastery, Aldershot: Gower PublishingChinese language edition published in 2002 by Century-Wave Co./PHEI, BeijingGattorna, J.L. (ed) (1998), Strategic Supply Chain Alignment, Aldershot: Gower PublishingJapanese language edition published in 1999 by Japan UNI Agency, Inc., TokyoChinese Language edition published in 2003 by Economic Management Publishing House, BeijinGattorna, J.L. and Walters, D.W. (1996), Managing the Supply Chain: a Strategic Perspective, London: MacMillan Press
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