Tag Archive: metrics

Future-proofing Your Supply Chain

February 21st, 2020

Disruptions abound in supply chain circles. Just consider any of the following recent events: the tariff war, global unrest, the Coronavirus, natural disasters such as the volcano in the Philippines, the Hong Kong protests and more.

We have never had a client that could claim that 100% of the extended supply chain (from suppliers’ suppliers to customers’ customers) was inside the U.S. So, we have to be prepared to navigate these types of disruptions and the related impacts.

Disruptions certainly go beyond your physical supply chain. What about your human capital, technologies (accompanied with processes) and strategies? Refer to our article on future-proofing your skills gap and assess which risks might be on the horizon in your industry.

When it comes to technologies, there is no doubt that emerging technologies are gaining steam and are starting to transform supply chains. Just consider the application of collaborative robots, automation, RPA (robotic process automation), artificial intelligence, IoT, blockchain, and predictive analytics to name a few. Big name companies are dropping big dollars into these technologies. When thinking about strategy, remember strategy is no longer a multi-year exercise. We must be thinking in terms of strategic sprints. Who knows what will happen beyond a year out!

Several high-level categories should be assessed as you think about your supply chain:

  1. Sourcing – Are you sourcing from China? Is this a viable path forward to source 100% from China? There are increased risk factors to consider. Listen to an interview I conducted with John Tulac, international business attorney, on future-proofing and doing business with China. It is time to reevaluate your supply chain footprint.
  2. Logistics – There are significant disruptors transforming this industry, ranging from e-commerce and the the Omni-channel to robotics, additive manufacturing and the digitization of the supply chain. If you aren’t incorporating these impacts in future-proofing your supply chain, you will be left in the dust. These are concepts of focus for the consortium for logistics success in the Inland Empire to enable companies to stay informed and keep up with the fast pace of change.
  3. Manufacturing – Industry 4.0 is transforming manufacturing and changing the landscape. It will be a pivotal year that separates the winners vs the losers as advances are made. See what the National Association of Manufacturers’ Leadership Council sees as critical issues
  4. Demand & Supply – There is no doubt, there is a keen interest by business owners, executives and private equity leaders on creating predictable demand and forecasting sales. The more we understand our demand plan, the better our operational performance, supplier performance and customer performance. Read about SIOP (sales, inventory, operations planning) and how it can help future-proof this area.
  5. Inventory – As the disruptions abound and executives fear a slow-down, the proactive management of inventory and advanced collaborative programs are gaining in relevance. Pick up some tips and strategies in our recent article ” Inventory Management as Fashionable as Automated Intelligence for Distributors” for ACHR News.
  6. Metrics & Predictive analytics – Keeping a pulse on performance should remain a top priority while forecasting what will be needed.

Getting ahead of the curve might be the only avenue to success. Consider creating a resilient supply chain and future-proofing your supply chain. Stay tuned and read more about it, and If you are interested in discussing a supply chain assessment, please contact us.

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Kaizens & the Importance of Metrics

December 20th, 2017

My colleague and I led a Kaizen workshop on metrics last week with a process manufacturing client.  It is always interesting to brainstorm which metrics are the most relevant in tracking a company’s success.  They are NOT always the same.  Companies are in different industries; they are different sizes; the profit drivers of the business are different; executives’ focus is different…..and the list goes on.   

However, every business should take a few minutes to strategize on metrics.  Do you know what you are doing AND whether the metrics you are tracking are relevant to your success?

One tip to implement this week:
As we said in kicking off the metrics Kaizen, it can be a great place to start by taking stock.  What are you tracking already?  Why?  Do you make decisions based on the metrics you track?  If not, why not?  In essence, take a pulse.  Next, it can be quite valuable to gain feedback on what should be tracked.  Have you asked the people talking with customers on a daily basis?  How about those producing and shipping to your customers?  I bet they will have something to say!  Certainly, executives always have a wish list for metrics.  Do you know which metrics are on the list?  

Although you might be tempted to jump on the long list you are likely to generate in talking with all the stakeholders in the organization, don’t do it!  Make sure to understand the impact.  Which will lead to decisions that will impact customers?  Which are likely to drive profitability?  Start with a small number.  Prioritize and start using for decision-making before you move on.

 

 



How To Know If Your Old Business System Is Just Fine

September 8th, 2017
Time for an upgrade?

Is it time to upgrade your business systems?

We cannot tell you how many clients call thinking they need a new system to support their business when they simply don’t! Certainly, there is a time to upgrade to a new business system, when you’ve outgrown your old one (for example: QuickBooks with add-ons like Fishbowl), or your old system is highly customized and unsustainable, or when you are in the midst of a merger or acquisition. However, before jumping to the conclusion that your system must be upgraded, think twice.

Any ERP transformation project will be expensive (more than you think!) and resource intensive. With that said, it is an absolute must to support business growth and success in some situations. Just make sure yours is one of them!

To upgrade or not to upgrade? That is the question.

It is also quite possible to extend the life of some systems. Is there a way to extend the life of your current system? We often find during analysis that there are options worth considering. It is smart to think about the timing of your upgrade and whether you can impact it. When can you dedicate the resources to ensure success? Of course, from one perspective, sometimes there is never a good time. And, on the other hand, we have seen clients wait “too long”. You don’t want to be in that club either.

Instead, complete a simple strategic analysis of your business situation and ERP needs and balance them against your current capabilities. An answer will emerge and just might “save you” either way. Perhaps you’ll be able to extend the life of your old system and maintain focus on your business OR you’ll find out that if you wait any longer, your competition will pass you by. Either way, it is better to be in front of it.

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Getting Out of the Weeds to See the Forest

August 4th, 2017
Turning Everyday Interactions into Profitable Opportunities

I’ve been working with several clients recently who are interested in “getting out of the weeds” so that they can “see the forest”. In a few cases, we’ve talked about strategy and reviewed key information about customers, demand, supply and financials. Although there were benefits to each piece (including being able to make decisions such as in-sourcing/outsourcing, equipment purchases, lease renegotiation, and hiring), it was no comparison to the value of being able to see the BIG PICTURE.   

See the big picture, the forest not the trees!

Similar to driving to work every day and not remembering how you got there, we are often caught in the weeds of day-to-day execution. These events can be vital to the business but we can miss the larger forest by never taking a step back. For example, we could be focused on improving a process like order entry for a specific customer with an eye to making it ‘perfect or ideal’ and miss the point – why are we entering orders for this customer in the first place? It is strategically necessary? How does this step affect others along the process?

One tip to implement this week: 

Seeing the big picture is a sometimes a unique talent; however, you also can deliberately set out to improve your vision of the big picture. Why not dedicate time this week to a few simple tasks? Start by thinking about these questions:

  • Why am I performing this process or step?  
  • Can I see beyond the next step? What is the end goal?  
  • Once you’re thinking more about the forest, take a step back to observe. Have you been “seeing” what is really going on and how what you’re doing fits in?  

Note: seeing the bigger picture isn’t a solo activity. Collaborate with your peers, employees, managers, customers, suppliers, and trusted advisers where appropriate. Be on the lookout for this result – the end goal. Have you ever noticed that if you plan to buy a car, suddenly you see many more cars on the road that look good? Or, if you are having a baby, suddenly babies appear out of the woodwork everywhere you go? The same concept applies as you look for the big picture. Soon, it will emerge – and you will emerge from the weeds.   

 

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Best Practices in Project Teamwork

December 19th, 2016
project teamwork

Since projects lift bottom-line business results, companies depend on these initiatives for growth and profits. Cultivating a strong project team and handing them a clear goal are keys to success.

In working with clients ranging from small businesses to large, complex, global organizations across multiple industries, I’ve yet to run across a client that doesn’t rely heavily on project results to support customers, grow the business and increase profitability. What else could be more important to business success?

Since projects cannot succeed with a sole participant, project teams are essential to success. Therefore, discovering the best ways for project teams to work together will lead to results. After leading and participating in hundreds of major projects and many smaller projects over the last 25 years, I’ve compiled a short list of best practices for project teamwork.

1. Clarity of Goals

As with almost every team, the team will be far more successful if the individual teammates understand the goals. Start with the goal of the project. Why are we doing this? What does it accomplish? What are the expected results of the project? Answering these questions will provide clarity of the overarching goals.

Next, go over the critical path milestone. What is the goal of each milestone? Who needs to do what to make them happen? Following this exercise provides clarity of the project plan and project objectives. All team members are on the same page up front.

2. Resolve Goal Conflicts

Of course, gaining clarity on the goals and critical path alone won’t foster teamwork. The next step is to resolve goal conflicts. I’ve found that as teams go through this process, 80% of the time, some sort of conflict will arise. The main conflicts fall into two categories – resource availability and department conflicts.

In today’s Amazon-impacted world, speed is of the essence. Equally troubling, since the recession, organizations are running lean and so time is limited. Thus, conflicts related to resources are commonplace. For example, let’s assume there are 16 hours remaining this week, and one team member has to complete a project task on the critical path that would require 8 hours of time by the end of the week in order to keep the project on-track. Alone, this is not a problem. However, his/her line manager also has a priority task that requires 16 hours of time that must be complete by the end of the week. An inherent conflict exists. The sooner this problem is uncovered, the sooner it can be resolved.

Equally commonplace are inherent conflicts between departments. For example, if a project task requires Purchasing to get volume discounts while a different task requires Planning to reduce inventory which would require more frequent deliveries, even though both team members are available to complete their tasks, there is a conflict between the two. Again, the sooner this is uncovered, the sooner it can be resolved.

3. Reward Project Goals; Not Individual Goals

One of the most common issues that arise is when the individual is rewarded for doing what benefits them instead of the project team. Similar to aligning goals, rewards and recognition need to follow the team. If each person does their part to contribute to getting a milestone accomplished, the entire team should celebrate success. If one person can be rewarded for achieving an individual goal while the team doesn’t meet its goal, a miss-match will occur.

4. Metrics

I’ve found that one of the most important ways to align teams is to have a common set of metrics. What is measured will be achieved. Thus, if the team has a clear set of metrics, everyone will be tracking the same items. Thus, as conflicts arise, the metrics will provide initial direction. Also, the metrics focus teams on what is most important. In my experience, the simple act of selecting and tracking a few metrics can create significant teamwork. The team unites behind improving the metrics.

5. Celebrate Successes

Lastly, celebrating success is an important way to tie it all together. Teams unite when the individuals get to know one another. Celebrating success allows the team to connect in a different way and it creates momentum. Thus, celebrating small wins along the way (such as the achievement of critical path milestones) can go a long way to enhancing teamwork.

Teams with stronger levels of teamwork surpass the results of those with high individual contributors that do not work as effectively together. In my experience, even if the high individual contributors are the best of the best as compared to medium contributors that work well as a team, the team of medium contributors will win that race. Appreciate the value of teams and consider implementing a few of these strategies to accelerate success. Bottom line results will follow.

 

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