Nurturing the Supply Chain Farm Team

Join the supply chain conversation at Think Supply ChainLast week I had the opportunity to spend time with executives of small and mid-sized manufacturing companies in the greater Louisville, Kentucky area. I was invited to speak at the Metro Manufacturing Alliance (MMA) annual summit at Ivy Tech Community College in Sellersburg, Indiana. My speech focused on workforce development and how important it is for small and mid-sized manufacturers to invest in developing a “farm team” of talented workers who can contribute to the long-term success of companies.

After the conference, I stayed for a smaller luncheon gathering of CEOs. Here’s where my fellow presenters and I were able to really get down to the heart of the matter. I learned:

  1.  CEOs of small and mid-sized manufacturers are first and foremost members of their communities. They know their workers, their families, and their school systems.
  2. They are concerned that the education system, especially at the high school level, focus primarily on steering students toward college instead of the trades, even though skilled trade workers can make as much or more money than the average college-educated worker over their lifetimes.
  3. These CEOs are committed to their workers and are willing to make investments to ensure their success at their companies, but they also struggle with worker retention and want to know that investments they make are going to pay a return.
  4. They are working creatively to develop programs, such as apprenticeships, that train or retrain workers to have fulfilling careers with their companies.
  5. They are not only concerned about the skilled labor shortage, but also succession planning and developing management talent that can ensure the sustainability of their companies.

As we spoke, I was impressed by the sincerity and earnestness of all the people sitting around the table. I believe, with the help of organizations like the MMA and One Southern Indiana, they will be able to make something happen that will benefit their communities and their companies. Then I had to wonder, what is the role that the APICS Foundation should be playing? After all, education, like politics, is local.

Investing in Supply Chain Education and Training Programs

I come from a family of educators and am part of a generation of Americans raised to believe that college is the terminus of formal education. So I get a little uncomfortable when participating in discussions that suggest that all young people should not aspire to go to college. But my husband—the guidance counselor—tells me I am missing the point. True success, he says, depends on discerning the right path for the student based on their abilities and sensibilities. This is no easy task when government and parents are inclined to measure success by the number of college applications accepted. Add to that the enormous caseloads for guidance counselors and their inability to really know their students, and it is no wonder we tend to seek cookie cutter approaches to steering students in the directions of their futures.

Organizations such as APICS and the APICS Foundation can support local efforts by helping to build national and international awareness among teachers, guidance and career counselors, parents, and students about the many opportunities that exist in the world of manufacturing. Some of these opportunities can be found in trade and others in management. Regardless, they both require education and training beyond high school. They both can lead to fulfilling, life-long careers in manufacturing.

How can we start to change society’s views of success? What can APICS do to nurture the “farm team?”

PwC Supply Chain Sustainability Research

Join the Supply Chain Conversation at the Think Supply Chain blog - Jonathan Thatcher APICS Research DirectorHow do organizations actually increase their supply chain sustainability maturity? How much progress do companies see? What barriers are in the way?

Plenty of research exists—from academia, consultancies, and research groups—that addresses these questions. Typically such research will include surveys of senior managers that captures their sustainability plans and goals. But less common is research that analyzes the supply chain and operations management practitioner. And even more rare is research that looks at both the practitioner and senior managers—research that identifies gaps in management thinking that leads to different perceptions, priorities, and barriers to advancing supply chain sustainability.

This year, APICS and PwC, a leading consulting firm, have combined forces to study these less-common, yet vitally important issues. It is an excellent match—APICS has an impressive network of practitioners and research, and PwC has done extensive research from the senior management perspective. Together, we focused on paying close attention, in survey and analysis terms, to both senior managers and supply chain and operations management professionals. By comparing and analyzing their responses, a clearer picture emerged of the root causes that slow sustainability efforts in supply chain strategy.

Initially, the opportunity to produce such unique research came in 2011, when APICS began studying the difficulties practitioners face in advancing sustainability maturity. In 2012, follow-up research suggested that one major challenge was the enterprise’s differing perspectives on supply chain sustainability strategies, expectations, and planning and execution.

Discovering supply chain sustainability trends

The combined APICS-PwC research  revealed gaps on a number of fronts. For example, many executives and senior managers mentioned the importance of long-established sustainability trends and policies at their organizations. However, 53 percent said they believed their employer’s sustainability history was unknown to them, or its history was less than five years old. Clearly, different perspectives about the history of sustainability were in play.

The combined research also revealed that the practitioner and senior manager perceive different barriers. The existence of supply chain sustainability strategy is one example. Only 5 percent of executives and directors reported that they had no supply chain sustainability strategy, while 21 percent of practitioner managers reported having no supply chain sustainability strategy. Further, practitioners said that leadership does not provide mandates, incentives, and resources to turn sustainable strategies into action. Other respondents added that significant confusion existed about the scope and goals of supply chain sustainability. In sharp contrast, 55 percent of executives stated that supply chain strategy exists and is fully communicated across the organization, or that supply chain strategy exists but has not yet reached all levels of the organization.

Another key difference for the two groups was in realizing value from supply chain sustainability. The survey included questions that asked for respondents’ perception of company performance. Two thirds of companies that reported they did not realize value from supply chain sustainability also stated that they had no practical measurement or tracking in place for supply chain sustainability initiatives. In contrast, only 22 percent of companies who did report realizing value also reported they had no practical measurement or tracking in place.

Ideally, both senior managers and supply chain and operations professionals should work toward increasing sustainability with the use of objective, practical, and insightful tracking and measurement resources. These two groups can more closely align their perspectives. Following are several ideas to consider:

  • A communication or feedback path should exist between management levels to ensure organization-wide practice is on target, particularly where practitioner responsibilities are key. The practitioner must be able to work through prioritization, conflicts, and master planning and scheduling. Keep the practitioner updated on detailed strategy. How the practitioner executes supply chain sustainability strategy influences sustainability practice elsewhere in the organization.
  • There must be effective and practical education and training to ensure best practices exist throughout the organization. Shared use and reporting from tools, systems, terms, metrics should be the result—where education is backed up with incentives, real-world use of resources, and best practices.
  • Help ensure executives and directors provide support for staff ideas. Executives and directors say they are enthusiastic about staff ideas toward sustainability and believe there are more metrics and goals in place, but managers and their teams see it differently. Fewer managers report getting support from senior management for implementing staff ideas.

Considering these ideas may help broaden engagement by breaking down silos between senior managers and supply chain and operations management professionals. Remember, effective sustainability efforts do more than help workers feel good, they have the potential to improve brand image, encourage innovation, promote cost cutting, and comply with government regulations.

Brand, Values, and Supply Chain Strategy

Join the supply chain conversation at Think Supply ChainDan Castle is a true APICS success story. A longtime member, instructor, and leader, he made a very bold professional transition in 2009 and became the chief quality officer for Tata Communications in India. Dan recently transferred to Tata Quality Management Services, a division of Tata Sons, and he is charged with helping to set standards of excellence to achieve improvement goals across Tata enterprises. Because of his new role, Dan was excited to learn that APICS was holding the 2013 Asia Supply Chain & Operations conference April 4–5 in Mumbai. In preparation for the conference, I recently visited Mumbai, and Dan invited me to spend some time with Tata leaders and staff.

It was an incredibly valuable trip. Most impressive to me was how Tata employees I met were ambassadors for Tata Group corporate values. We heard stories about how Tata values, developed over the past 145 years, are sometimes at odds with the business culture in Indiaand the global business culture. The effort Tata leaders have taken to empower every employee to act upon the corporate values of integrity, understanding, unity, excellence, and responsibility has made Tata a recognized economic, social contributor on a global level. That Tata customers appreciate the connection is evident in the fact that the Tata brand is among the top 50 global brands based on net present value.

Brand impact is based on many intangibles, but there is no question it is significant to increasing shareholder value. Therefore, it is an important consideration in supply chain strategy development. Regardless of size, enterprises with values that are closely connected to their brands must take up the challenge of creating supply chain strategy and tactical plans that are consistent with those values. Sourcing, production, and distribution strategy should all be expressions of corporate values, and the decisions that supply chain professionals make day-in and day-out need also to align to these values.

The Tata Group is not the only Indian-based multinational enterprise making this connection. Infosys is leading a newly formed United National Global Compact (UNGC) sustainable supply chain taskforce on traceability. According to the UNGC, the purpose of this taskforce is to develop, “practical guidance for companies on how they seek improved transparency and traceability in their supply chains.” Transparency ultimately reveals whether corporate strategy is true to corporate values.

So what is the best way to ensure that corporate values influence supply chain strategy and execution across an enterprise? Are there compelling success stories? Which companies are best at walking their talk?

Mind the Strategy Gap

Join the supply chain conversation at Think Supply ChainYour comments after my last post, which I greatly appreciate, reminded me of an interesting meeting I had a few years ago. The group was discussing strategy and linkages between corporate strategy and supply chain and operations strategy. After the meeting was over, I asked Robert Vokurka, PhD, CFPIM, CIRM, CSCP, 2008 chair of the APICS board and a professor of operations management at Texas A&M University, to help me understand the disconnect. As he explained it, we ended up drawing a continuum on the white board that looked something like this:

Think Supply Chain

In organizations where a gap exists, it is likely that a combination of the following is happening: corporate strategy is not being effectively communicated across all levels in the organization and staff on the execution side of the business is not proactively seeking to understand corporate strategy and how it impacts what they do.

Imagine the many decisions made every day by supply chain and operations management professionals primarily responsible for execution. To whatever extent a gap exists between current corporate strategy and execution, it creates risk and loss of opportunity. Yet, the negative impact of the gap is a shared responsibity of corporate leaders, managers, and individual employees. How do you mind the strategy gaps?

  • How do we ensure that employees at all levels of our organizations are making the best decisions based on corporate strategy?
  • How does one proactively gather the information needed to be certain that his or her work aligns with corporate strategy?
  • What does it take to have confidence that all policies, processes, systems, and staff are aligned to achieve corporate strategy?