12.01.2006

Closing the Supply Chain Gap With Lean

In a reinforcement of the beliefs of those of us who are lean advocates, according to a new academic study, supply chain experts agree you need to focus on the process (read: take a lean approach) to succeed in today’s world.


            The study was described at the recent APICS conference by three of its authors: Dr. Steven Melnyk of Michigan State University, Dr. Rhonda Lummus of Iowa State, and Dr. Robert Vokurka of Texas A&M. (Joe Sandor of Michigan State was the fourth author.)


            The study, designed to identify critical supply chain issues facing managers in 2010 and beyond, involved two groups of supply chain experts – one of corporate executives, the other of academics. They responded to questions, then took part in a workshop.


            The top issues the experts identified are:



  • Supply chain disruptions and supply chain risk
  • Leadership within the supply chain
  • Managing the timely delivery of goods and services
  • Managing product innovation by drawing on the capabilities of the supply chain
  • Implementing appropriate technology to allow seamless exchange of information within the supply chain

            The experts then identified 16 initiatives to get there from here, and summarized those initiatives into six strategic initiatives.


            Of the six, the one that jumps out at me is “Manage through a process orientation with appropriate measures.” That sure sounds like a description of what you do when taking a lean approach. Lean is all about focusing on the process and making sure you measure what really needs to be measured.


            The five other strategic initiatives are:



  • Achieve strategic visibility/alignment and information integration
  • Acquire exemplary supply chain talent and leaders
  • Utilize supply chain optimization models (e.g., risk, cost)
  • Focus on relationship building and trust both between and within companies
  • Align and realign supply chain architecture/structure

            Like me, you may be thinking that while everything described so far is good, it doesn’t tell us a lot we don’t already know.


            But don’t despair: There may be something of more practical value available in the future. The study is moving into a new phase, with the survey participants involved in subgroups that will focus on identifying management practices and research agendas that may help close the gap between current performance and future needs. The subgroup areas are operational, strategic, collaboration, metrics, risk and cost models.


            And according to the survey authors, identifying those best practices is critical. In an executive summary prepared for the conference, they wrote, “Those organizations that are best at closing the gap will have a competitive advantage. Those who have not prepared for the future will face unacceptable risk and higher total cost.”


 

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