LINKING PROCESSES, PEOPLE, AND PRIORITIES IN THE SUPPLY CHAIN







Are Check Points Required to Deliver Project Results?

January 22nd, 2015
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check points in project management

Since most managers juggle multiple projects, knowing where your team stands on each project is critical for the successful execution of each.

Effective project management has become cornerstone to business performance. Although we are largely in a recovery, none of my clients have gone back to the days of having more than the required resources “just in case” yet project demands are ever-increasing as profitable growth is key to success. In essence, if you want to thrive in today’s new normal business environment, you will not only execute flawlessly but you’ll also innovate constantly. Neither will deliver results without flawless project execution. Based on my observations, 90%+ of my clients and contacts struggle to resource projects and overcome obstacles quickly enough to ensure success. What should we do?

For example, one of my key clients has at least 7 critical project priorities in process simultaneously. This alone is problematic enough as it’s been proven over and over again that people can only multi-task so far. In my experience, anything beyond 3 priorities will suffer. However, in addition to this burden, they have resourced these projects with people who already have full-time jobs. Unfortunately, this occurrence is not uncommon.

Of course, my first priority with these situations is to work with the client to take a step back and re-focus in on fewer priorities. Once the first few are completed successfully, we’ll move on to the next set of priorities. In 100% of the cases, I’ve seen this tactic achieve significantly greater success. However, whether we follow the smart path and focus on just 3 priorities or try to keep track of all 7 at once, we must implement check points from the start to have a chance at success! A few keys to success include: 1) Understand milestones. 2) Think about evidence of progress. 3) Develop a check point process.

1. Understand the milestones: Although it might seem basic, it is the most often overlooked critical variable to success in my experience. Do NOT start performing tasks; even if it seems like a critical task, stop yourself before jumping in. Instead, develop the project plan. Take a step back and review the project plan. Does it seem complete? Are there too many tasks? Can some be combined? Which are dependent on which other tasks? Do you know the difference between dependence and sequence? If not, circle back and start again. Have you added fluff to your task times? Why? If everyone adds just 1 day cushion to every task, it will have greater than a 20% impact on almost every project and a 50% impact on the majority.

For example, if you know that you cannot improve your on-time delivery metrics if you don’t improve inventory accuracy, it might be tempting to start addressing that issue immediately. Although it is undoubtedly one of the tasks required to improve on-time delivery, there is no way to know its importance vs. the other tasks without taking a step back. What if throughput had to be increased by 50%? This task would be more important because no matter how accurate your inventory, you can’t do anything with half of your orders if you cannot get them out the door. Also, what if throughput is dependent on another task which doesn’t seem that important in isolation? Typically I see clients ignore that task completely yet it is the most critical task of the three mentioned because it must be completed prior to throughput increasing!

2. Think about evidence of progress: Once you have your project plan outlined and milestones identified, the next step is to make sure you are making progress on these milestones. First, take another step back to identify the critical path. The critical path will tell you where to focus. The milestones on the critical path are the ones which deserve 80% of your attention as they’ll give you 80% of the result with 20% of the effort.

Your critical path milestones are your check points. If you are achieving these critical milestone check points, you’ll be successful. It can be as simple as that! Of course, it rarely is that simple because we veer off the critical path and spend time on items our boss asks us about or those items which seem interesting. None of these paths will yield success because they are not check points to the project success. Stick to the critical path. The great news it that in project management, the critical path provides the check points whereas in many other areas, you must decipher the check points. If you are in this situation, just ask yourself the question: What would tell me I’m making progress? What would I have to see, hear, and/or have as evidence?

3. Develop a check point process: Last but not least, you must develop a check point process. What does this mean? In the simplest format, it means you develop a communication and tracking method to follow up on the critical path check points. I’ve seen many different processes “work”. The key is in the follow-up and the leader’s ability to ask the right questions at the right time and his/her willingness to address the “hard” issues.

For example, one of my clients developed a brief weekly project review meeting to go over the critical milestones. Issues with project tasks were not discussed as they should be incorporated into regular project management cycles. Instead, the meeting was focused on which critical path milestones were achieved, which are coming up, and whether there are roadblocks affecting any critical milestones. There are many communication vehicles and formats. Choose whichever works best for you and your culture.

In today’s new normal business environment, delivering project results is vital to success. Thus, although it has always been the lifeblood of project success to make sure there are check points to tell you whether your projects are on track and where to focus attention; it has a direct correlation on bottom line business results today.

Did you like this article? Continue reading on how to be the System Pragmatist in your supply chain:

Project Failure: How to Avoid Top Causes

Overloaded Project Manager? Here are 8 Simple Tips to Help!

 

© 2015 LMA Consulting Group



6 Process & Systems Trends for Success

January 20th, 2015
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process & systems trends

Business processes should evolve as the business climate changes by keeping an eye out for emerging trends and finding opportunities to pull ahead of the competition.

 

As we start a new year, it seems an opportune time to discuss systems and process trends. I find that those clients that pay attention to trends and find opportunities to leverage them often surpass their competition.

I’m working with a diverse portfolio of manufacturers and distributors ranging from $6 million dollar, family-owned businesses to $100 million dollar facilities of multi-billion dollar, global companies. When I see trends that cross company-size, geography, position, etc., I take note. If you can apply the “right” best practice to the “right” situation at the “right” time with the “right” people, you can dramatically increase the value of the business.

Several of the latest process and systems trends that pop to mind include:

1. The value of common sense processes: A few months ago, I wrote an article on uncommon common sense, and I have to say that my most successful clients by a long shot are those that employ common sense best practice processes. This does NOT necessarily mean they are lean gurus, Six Sigma black belts, systems gurus or even Harvard grads. Instead, my best clients involve their people, listen for ideas, leverage collaborative relationships and utilize what makes sense.

For example, I’ve had several clients with unsung heroes working in their midst. One planner could turn straw into gold in terms of optimizing operations, inventory levels and service levels but was largely overlooked because she didn’t “talk the talk”. Another client had a data ninja who was a superstar in developing common sense best practices in leveraging data for management decision-making but he was not fully appreciated. Another had a transportation wizard hidden in the background because he didn’t “talk the talk”. In each of these situations and countless more, I have helped my clients achieve significant goals by finding these already-existing stars and asking for common sense processes that will be effective.

2. Simple process visuals: Again, I often find my clients and contacts getting carried away with the latest and greatest processing mapping techniques. Of course, these can often times be useful; however, what really brings results is simplified process mapping and process visuals. In essence, break the process into manageable chunks and steps. Make it understandable to the masses. You’ll be surprised what you find when you simplify and clarify. For example, one of my clients told me earlier today about a great success she had in operations efficiency by shortening the production line so that she could “see” the process gaps. Simplicity works.

3. Excellence in project management: Undoubtedly, those clients who are expert in project management succeed. The best plan with poor execution will fail whereas a mediocre plan with exceptional execution will likely succeed. I don’t see this as a conflict with lean concepts. To me, Kaizen events just bring the right parties together to focus time to understand processes, review gaps, brainstorm improvements and implement whatever is achievable within the Kaizen window. Actually we could go back to point one – uncommon common sense! As one lean guru told me, the ideal Kaizen is set up to be a chunk which can be fully completed during the event. With that said, the same types of project management skills are needed – period.

4. Business intelligence: The value of rapidly sifting through mounds of data, finding the right data and analyzing the data so that information is available for strategy setting and decision-making is becoming cornerstone to success. Those clients with a data ninja should hang on to him/her for dear life! It is not as easy as it looks to achieve; however, there are tools available to make it more achievable.

Many ERP systems have business intelligence type tools with drill down capabilities. If you have an ancient system, there are always options available to add-on or simply utilizing Microsoft Access can be sufficient. One of the data ninjas I worked with in my career prior to consulting was a MASTER wizard with Microsoft Access and data. This article reminds me of several fun people I’ve worked with over the years….one of my first clients was a huge trade association that wanted to select the right business intelligence software to support their business and customer base. There is power in leveraging data!

5. E-commerce: E-commerce has become an assumption. In almost every ERP and systems selection project I partner with clients to complete, e-commerce is an expectation. If it is not an immediate requirement, it is a “must-have” in terms of business growth. Manufacturers and distributors are having to either compete with Amazon or are having to live up to Amazon-like expectations whether or not Amazon will ever become a competitor. According to my research study on the Amazon Effect, building out technology infrastructure including tools such as e-commerce is key to meeting customers’ expectations.

6. Leverage smart technology: In essence, everyone should NOT use the same technology. Since I help clients identify and leverage systems and technology to support their business growth and to elevate business performance, I often run across a common theme when it comes to leveraging technology – a race to the fads! Instead of worrying about keeping up with your neighbor or competitor and use the same latest and greatest technology or system they use, take a step back and determine what would help your company achieve its strategy or strengthen its competitive advantage. You’ll spend a whole LOT less yet you’ll be FAR more effective.

Pay attention to trends for opportunities to grow your business, become more efficient, increase margins and the like. I’m launching a new service, the Profit Chain Accelerator Program to identify and leverage these types of opportunities. Email me for more information.

Did you like this article? Continue reading on how to be the System Pragmatist in your supply chain:

7 Hot ERP Systems Trends  

Hidden Opportunities for Process Improvement

 

© 2015 LMA Consulting Group



Critical Success Factors are the 80/20 of ERP – and Business – Success

January 19th, 2015
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supply chainOne of my clients had three sets of ERP system demos this week in a quest to select the best system to meet their business objectives. Not only is it a vital part of selecting the optimal system, I also find that it is always interesting to see how the software will meet the particular client’s needs – and what a big difference the people and presenters make in the process.

This week was no exception; being razor-focused on critical requirements paid off. In essence, what is unique about the industry or company? For example, is serial number tracking required? And/or what functionality is needed to support the company’s strategy, growth plans or profit drivers? For example, one that arose this week is that the company does an impressive job of forecasting manually to drive high service levels during rapid growth. Does the system support this need in an efficient way?

Are you thinking about your critical requirements? Whether selecting a system, thinking about your daily priorities or designing a new business process, it will be a worthwhile exercise.

One tip to implement this week:

Think about your critical success factors.  Whether you are selecting a system or not, you’ll make better decisions if you understand these factors. It depends on your position: 1) If you are an executive, think about what makes your company stand out from the competition? And think about what drives business growth and profitability. 2) If you aren’t an executive, think about what seems to be important in your sphere of influence. What might seem more important or be different from what you learned in school or experienced at other companies? Do those factors seem like contributing factors for success? Take ideas to your manager, owner or executive. I have no doubt it will be a “win”. These critical factors are more important to success than the rest. Thus, treat them as top priorities. Success will follow. 

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

 

© 2015 LMA Consulting Group



Customer Collaboration on Orders = RESULTS

January 16th, 2015
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collaborating with customers

Working in partnership with your customers delivers winning results on both ends.

Customer collaboration has become cornerstone to success in today’s supply chain driven world. We are all part of a supply chain, and so we must look for ways to thrive within our supply chains. Undoubtedly, those who collaborate with their supply chain partners will succeed whereas the rest will struggle. One simple yet impactful way to collaborate is with orders.

This concept is sometimes called consumption based ordering, sometimes VMI (vendor managed inventory), sometimes auto replenishment and the list goes on of possible names for order collaboration. The point is that it is a process where the supplier places orders for the customer based upon a mutually agreed upon process, data sharing strategy and metrics. The customer provides the appropriate data to the supplier to be able to develop orders aligned with the metrics.

Case Study:

During my tenure at PaperPak, we achieved the following successes with our #1 customer:

  • Recognized by #1 customer as “supplier of the year”
  • Increased sales
  • Became “part of the customers’ organization”
  • Doubled inventory turns
  • Improved customer service to 98%+
  • Reduced lead times and improved costs

These results occurred while supporting customers on VMI through several business condition changes:

  • Merger/acquisition
  • Turnaround & cash crisis
  • Private equity buyout
  • Several software, process, people and insource/outsource changes

As one would expect, there were trials and tribulations, yet we achieved great success overall.  The keys to success in this example were the 3 P’s: 1) People; 2) Process; 3) Partnership.

  1. People: The right people are your #1 asset. First, senior leadership makes or breaks any vendor-managed inventory program. Senior leadership must provide commitment and support, have a high level understanding of the value that can be achieved through a VMI program and be able to explain the whys. Understanding and being able to explain the whys behind a VMI program are key so that implementers’ individual goals are tied to the big picture and tools and support are provided. For example, since PaperPak had senior leadership support, the customer and bottom-line impacts were understood and valued, which resulted in the appropriate resources and funding allocations.

Second, the right VMI planner is critical. After putting the wrong person in the role, we quickly discovered the importance of finding the right person with the right skillsets for the VMI planner position. Our service levels suffered until we found a person with an analytical skillset. Ideally, the VMI planner will be analytical, enjoy the optimization game, be self-confident as he/she is “in the middle” of several competing priorities, customer focused, and be excellent at not only details but also the big picture.

Lastly, there are other people integral to VMI success – Customer service, Planning, Sales, and Information Technology. To achieve success, it takes a team.

  1. Partnerships: In essence, refer back to point #1 – the right people. In this case, we expand the concept to think about the right partnerships with customers and suppliers. My definition of how to achieve a successful partnership is simple – think ‘win-win’. To create a successful VMI program, it requires a close partnership with your customer. The ingredients for a successful partnership are trust, the ability to find and create win-win ideas, and a collaborative view on forecasts, goal setting, and metrics. The same holds true for your suppliers. View your customers and your suppliers as an extension of your company and supply chain. With a partnership, you should be able to turn 1 + 1 into 5; meaning, your returns will be exponential over what you would achieve on your own.
  2. Process: To ensure flawless execution and customer service, process is king. Rigorously following the traditional plan, do, check, act model can yield significant results. It has been shown that although most people spend the majority of their time on the “do” of plan do, check, act, the successful implementers spend a very small portion of time (10%) on “doing”. Instead, the optimum numbers are the following: plan (70%), do (10%), check (15%), and act (5%). As this implies, follow-up/audit is also essential for success. Without continual review and improvement/adjustments, the process lags.

Think about how you can implement customer collaboration strategies. If you are interested in freeing up cash, maximizing profit, growing sales and elevating your business performance, customer collaboration is a no-brainer. No capital investment with amazing results – not only bottom line results but also happier customers and engaged employees. Pick up the phone to your key customer to explore the possibilities.

Did you like this article? Continue reading on how to be the Strongest Link in your supply chain:

Catch The Wave on Customer Collaboration

Start with Your Customer

 

© 2015 LMA Consulting Group



Cycle Counting Remains Core to Success

January 13th, 2015
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cycle counting

Inventory management relies on fundamentals like cycle counting to catch discrepancies. But it has to be coupled with a focus on process disciplines or you’ll end up reliving the same problems every day.

I’ve started working with one of my clients on a cycle count program, and so I’m reminded of the critical importance of this supply chain fundamental. If you cannot find the right inventory in the right place at the right time, your customer will be negatively affected. This should be a sufficient reason to pay attention if you’d like to grow – or even maintain your customer base; however, it will also impact your profitability and cash flow if you need additional incentive.

Cycle counting is a measurement process; however, cycle counting alone will do NOTHING to fix your inventory accuracy issues. Count and adjust; count and adjust. If there is no root cause analysis, it becomes a vicious cycle with zero accomplished. Instead, you must focus on process disciplines. Does your company value process disciplines? Do NOT think about what is said. Instead, answer this question: If the employee responsible for work order transactions is near the end of the day and a machine breaks down, will you divert him/her from transactions (even if there is no backup) to help fix the machine? How about if you are being questioned by Finance about overtime and your resource already has worked “too much” overtime? Will you send him/her home and tell them to complete another task and finish the transactions tomorrow? What message does that send?

Did you like this article? Continue reading on how to be the Strongest Link in your supply chain:

Cycle Counting 

Tips for Physical Inventory Success

 

© 2015 LMA Consulting Group



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