LINKING PROCESSES, PEOPLE, AND PRIORITIES IN THE SUPPLY CHAIN







Creating a Culture of Innovation

July 24th, 2014
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innovation, success

Pinpointing success is about re-packaging—literally and figuratively—by connecting the dots in a new way and seeing trends and hidden profit opportunities.

There has never been a better time to cultivate an environment of innovation! We are in what has been referred to as the “new normal” business environment. Gone are the days of the last decade when we saw examples of 10 percent sales growth achieved solely by picking up the phone. Although we are in the recovery, we must be deliberate if we want to grow.  It will not happen by default.  Customers are demanding more for less at quicker speeds than ever before.  Speed wins business.  For most of my clients, if they can deliver 5% better (consistently of course) than their competition, they’ll win the business.  Last but not least, searching for ways to increase margins is a never-ending focus.  To successfully navigate these increasingly complex waters, innovation is a must.

In today’s economy, it is not only important to think about how to incorporate innovation into your business, it is vital. Slow and steady progress and continuous improvement no longer will cut it. In the past, “good” worked; today, it might not even keep you in business. It takes more than “good” to stand out in the crowd and deliver consistent and increasing levels of profitability and customer service; instead, radical change and innovation are required. Focus on how to create and leverage innovation to not only improve your profitability but also to leapfrog your competition. You must change the playing field—and therefore the rules of the game— and throw out your old business models and practices. Instead, you need to think and practice innovation.

Recently, when reading “Inside Steve’s Brain” by Leander Kahney, about the late Steve Jobs and creative innovation, I thought I came up short in that department. Imagine my delight when I discovered that I actually have a talent in innovation as defined by Jobs, which, of course, I now fully agree with!

“Creativity is just connecting things. When you ask creative people how they did something, they feel a little guilty because they didn’t really do it, they just saw something. It seemed obvious to them after a while. That’s because they were able to connect experiences they’ve had and synthesize new things.”

Thus, innovation is not some complex, non-understandable phenomenon. In addition to pure creativity, it’s about re-packaging—literally and figuratively—by connecting the dots in a new way and seeing trends and hidden profit opportunities. So, how do you go about creating a culture of innovation? There are three basic ways:  1) Focus on the customer.  2) It’s all about the people.  3) Flexibility

1. Focus on the customer. Everyone says they focus on the customer’s needs, but do they? Are they doing what they think the customer wants (i.e., that happens to fit with their idea of which products have the best features, or with current branding, or with manufacturing capabilities) or are they accessing what the customer values?

So, how do you find out? Talk with customers. Ask for the laundry list of requests but do not stop there. Ask questions to help prioritize the list with the customer in mind. Which are relevant to how the customer competes in the marketplace? Make sure your entire organization is focused on the customer — asking questions and providing value but not just jumping to each, unprioritized non-value added request.

2. It’s all about the people. It sounds strange for a discussion about innovation; however, the best people will create innovative ideas, products, and services. Consider asking your employees, your customers, your suppliers and other partners and trade associations. Undoubtedly, there will be a plethora of ideas.

Value the ideas, and give your employees room to try them out. The quickest way to kill a culture of innovation is to encourage ideas but not follow through and support them. It is much harder to implement than it sounds! In my experience, the first time an idea fails and causes month-end issues or customer problems, innovation is stifled. To counter this, we must reward mistakes as it is a critical component of cultivating a culture of innovation. However, we should address a trend that reflects the same mistakes since it appears learning hasn’t been incorporated.

3. Flexibility: Do not become married to one idea, one product, one customer’s perception, etc. Instead, create solutions that build in flexibility — think of the nontraditional “and” of two, seemingly opposite ideas. For example, instead of thinking that reducing inventory will result in poor customer service—since you might not have as many products available to ship—think about how to reduce inventory and increase customer service simultaneously. Build flexibility into the process, but do not throw the baby out with the bathwater — it still must operate within the guidelines.

Think about creating a culture of innovation, and you won’t be disappointed.  No one can do it alone; why not get your entire team thinking of how to “win”?

 

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Profit through People

 

 

© 2014 LMA Consulting Group



Leadership Is the Cornerstone to Delivering Better Business Results

July 22nd, 2014
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leadership

Profit through People by mentoring, listening, training and valuing employee input and contributions.

As I’ve been going through my hundreds of articles to put together the 100 tips, it’s become obvious as to which topics resonated with me as essential to delivering bottom line business results.  Here are a few highlights from the people perspective:

1. People are your #1 asset - If you don’t pay attention to your people, nothing else will matter. Start here.

2. Retaining top talent – It is not as simple as paying fairly. Those who retain top talent will thrive.

3. It Begins & Ends with Leadership – I still believe my HR mentor Debra’s comments sum this up, “It begins and ends with leadership”.

4. Culture – Very little progress can be made if culture doesn’t support it. Set out to be deliberate about culture.

5. Change management – Too many companies fail when it comes to managing organizational change. People do not fear change; they fear not knowing where they are headed and not having control over their destiny.

6. Performance management – the most overlooked yet essential item. Make the time to talk with your people. How can your #1 asset not be important? Set goals. Provide feedback. Mentor.

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Profit through People

 

© 2014 LMA Consulting Group



I’ve Been Thinking About Innovative Service

July 18th, 2014
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supply chain

A Tip to Make Sure Innovative Service Remains Top of Mind 

According to today’s Wall Street Journal, Amazon is thinking of offering an unlimited reading service – a game changer!  Amazon certainly epitomizes innovation as they continue to make waves with Sunday deliveries, the possibility of drones, and now unlimited reading services.  According to my new research study which measures the impact Amazon has on service standards and how manufacturers and distributors should prioritize offerings, 67% have gaps. I find that at least 80% of my clients experience these challenges on a daily basis as customers demand quicker deliveries and elevated service levels.

Those who want to thrive will focus immediate attention on understanding what your customers need and how to set your supply chain and its people, processes and systems up for success.

One tip to implement this week: Pick up the phone and call a key customer, supply chain partner or someone with intimate knowledge of what your customers desire (such as your Customer Service Representative or Logistics Manager) and find out more about what would add value for your customers.  I find that no matter how much I think I understand, I learn something new or am reminded of a value-add which could be immediately implemented to elevate performance.

Looking for more ideas to keep your supply chain talent? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”

 

© 2014 LMA Consulting Group



Demand Planning Best Practices

July 17th, 2014
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new mindset leads to new results

A reenergized demand plan is fortified with meaningful data trends that point the way to improved service levels and increased profit margins.

Sales and operations planning processes are key to improving service levels, accelerating cash flow and increasing margins.  Thus, it is worth pursuing the seemingly simple process of aligning demand and supply and your executive team on one plan.  It must start with the demand plan.

1. Talk with customers – it is surprising how often this secret to success is overlooked and not utilized.  Your customers will provide a wealth of information if you ask.

2. Review the data for trends – don’t get sucked into the data black hole!  Instead, review data for trends.  Are sales increasing in a certain area or product line?  It will give you follow-up items to discuss with your customers.

3. Focus on exceptions – one of the advantages of a forecasting system is that it will typically point out exceptions which are out of tolerance.  Whether your software points these out or you look for them manually, focus the 80/20 of your energy on those exceptions as it will drive results.

4. Dig deeper in your supply chain – ask your customers for end user data, point of sale data or any other data which will give you a better understanding of what is occurring deeper in your supply chain.  It is surprising how often it is available yet the goldmine is ignored.

5. Think about the market – talk with your sales and marketing teams, research the market, and get a feel for what is likely to occur in the market.  This will give you directional information for whether your demand plan is in the ballpark.

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Do You Need Systems for a Successful SIOP Rollout?

Sales & Operations Planning Drives RESULTS

 

© 2014 LMA Consulting Group



8 Strongest Links from Supply Chain Management

July 15th, 2014
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8 strongest links for supply chain management

The heart of supply chain management, meeting customer expectations while earning a decent profit, depends on the strength of fundamental systems and resources.

 

As I’ve been going through my hundreds of articles to put together the 100 tips, it’s become obvious as to which topics resonated with me as those essential to delivering bottom line business results. Here are a few highlights from supply chain management:

1. Demand Planning: It starts here.  What do you think your customers need?  What will set you apart from the competition?

2. Planning/ Inventory management: Who doesn’t have too much, too little, or not the “right” items at the “right” place at the “right” time throughout your end-to-end supply chain?

3. Inventory accuracy: Of course inventory accuracy affects efficiencies across the board but little matters if you cannot find your inventory to ship to the customer on time!

4. Capacity & staffing – Do you have the machines, tools and resources to produce the demand plan?  Are they cross-trained?

5. Customer service & lead times – Is your supply chain set up to deliver on-time and with lead times which will edge out the competition?

6. Logistics – Are your warehousing, distribution and transportation processes set up to achieve your customer expectations at the lowest cost to you?

7. Customer & supplier collaboration – Only those who collaborate will thrive.

8. SIOP/ S&OP – aligns all functions on 1 plan while balancing supply with demand

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Why Become the Strongest Link in Your Supply Chain?

 

© 2014 LMA Consulting Group



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