The Value of Acceleration & Speed

In this VUCA (volatile, uncertain, complex, and ambiguous) laden supply chain environment, the successful companies leverage the power of speed and acceleration. Resiliency is required to survive in times of heavy disruption, whereas speed and rapid acceleration will allow your organization to thrive. Responding quickly to issues and events to mitigate risks and negative cost impacts is a great start; however, achieving dramatic growth and a powerful return on investment with innovation and step change upgrades is the objective.

These benefits will occur when innovating, upgrading, and reconfiguring/ expanding infrastructure, processes, technologies, and talent with speed. Those companies that look forward and embrace these strategies will be prepared for the opportunities as they arise. Acceleration will enable them to secure quick wins, and speed will keep them ahead of the competition and building on success.

Case Study: Value of Speed & Acceleration in Supply Chain

An industrial manufacturer prided itself on its quick lead times and flawless execution in their top facility, mainly due to a strong leader focused on execution and team engagement. They grew from a small mom and pop operation to the largest facility across their global operations and had significant opportunities for growth. However, they were bumping up against the execution barrier, meaning sheer willpower and superior talent alone would not support the aggressive growth plans. They had to put scalability in place.

Because the leader was forward-thinking, although he believed whole-heartedly in the capabilities of his team and had a tightly controlled process that “worked” to ensure planning and execution success, he was willing to listen to new ideas. He was skeptical because he had developed a superior process that required minimal resources to run successfully. He also had to jump in and bail out an ERP implementation going down the wrong path by scaling back from detailed transactional requirements without commensurate value and create integrated work around solutions so that the facility could respond with speed and agility and deliver customer requirements successfully. In addition, he saw several steps down-the-line and could “see” mumbo jumbo a mile away, and so he had limited patience for items that would slow down his process or require additional resources.

In terms of the ERP example, not surprisingly, other clients in similar situations would listen to ERP experts and force their team to follow what was sold as “best practices” in how to use their ERP system. Situations are never black or white; just because something is a best practice for a particular software doesn’t mean it will be the best practice in each situation. On the other hand, changing the system to fit the process because you are opposed to change isn’t a recipe for success either. We have been called into multiple clients to resolve these situations as the team was extremely frustrated and working completely around the system to try to serve customers although they were failing with poor service levels or had mountains of people running around to “make it happen”. It doesn’t matter which ERP system as this occurred with every ERP system, Oracle, SAP, Microsoft Dynamics, etc. Our solution in each situation was to upgrade the process, use of the ERP system and associated data with real life customer needs, and develop commonsense improvements while educating and engaging the teams.

Back to the industrial manufacturer, the leader understood that he wanted a more automated process to ensure scalability yet retain rapid responsiveness, speed of execution and his lean team. Thus, although he was highly skeptical, when he met with us as we were consulting with another part of the organization, he listened to potential opportunities for improvement in supply chain planning and upgraded use of the ERP system and related technologies. Once he saw the potential, he became the largest supporter of the development of SIOP (Sales Inventory Operations Planning) and supporting planning and ERP tools and was patient with the long lead time it took to design processes, address data issues, develop connections between the CRM and quoting systems and the order management systems, design the appropriate translation techniques to turn dollar forecasts into product level forecasts, pursue planning and MRP upgrades, etc. It paid off as output doubled in a critical area of the facility and supporting processes were automated to gain visibility for forward-looking decision making.

Although he ran around with pen and paper and could be considered dangerous in the ERP system, he was a vocal, early supporter of advanced technologies and process improvements. He supported rolling out MES (manufacturing execution systems), screens at the machines to track progress and enhance visibility, barcoding in the warehouse to speed up shipping, receiving and put-away operations, and other improvements that would accelerate progress. The same was true in manufacturing as the facility was an early adopter of robots. Not everything worked. They had to return one robot as it was slower than manual labor, even after several months of improvements. But, they didn’t give up. They tried a robot in another section of the manufacturing facility with great success as it was a better application for the use of robots.

By utilizing the SIOP process, they gained insights into upcoming bottlenecks and addressed them proactively. For example, they upgraded their laser machine with a faster, better machine to increase output in anticipation of their growth plans and were well-prepared when the volume arrived. In fact, they gained volume with quicker lead times. They also purchased a paint line to expand capacity proactively. If they had waited, it wouldn’t have been approved due to changing business conditions; however, because they were ahead of the game, they were not limited in growth. In fact, they could support other facilities.

It wasn’t all speed. Acceleration was also key to success. Because several of these ideas were controversial or large changes to the status quo, getting the team moving quickly and achieving quick wins was integral to success. Only our best clients consistently move quickly and set up opportunities to accelerate early on and at key junctures. They leave the rest in the dust evaluating alternatives and crossing t’s and dotting i’s. We welcome your success stories about speed and acceleration.

If you are interested in reading more on this topic:
Resilience in Supply Chain of Paramount Importance