I have been writing a novel in my head for more than a decade. Every once in a while, I write a few words, snippets of chapters, but for some reason, I can’t seem to get into a sustained writing groove.
Why not write a book about logistics instead, a book about what I’ve learned the past ten years as an industry analyst?
This brilliant idea came to me last night, brilliant because here is a book that won’t take me very long to write. In the spirit of “All I Really Need to Know I Learned in Kindergarten,” here are the simple lessons that I have learned over the years.
Keep it simple. Many companies invest in supply chain and logistics software to keep pace with their ever-more-complex supply chains. But here is another option that few companies pursue: make your supply chains less complex. Somewhere along the way, companies decided that it’s better to deal with complexity instead of getting rid of it, which is why so many supply chain process maps and IT systems look like a Rube Goldberg drawing. Little kids have a tendency to ask a lot of “why?” questions. And when you given them the answer, they ask “why?” again. And this goes on until you finally run out of answers (or patience). When it comes to product proliferation, promotions, and other actions that add complexity to supply chains, I think companies need to start asking a lot more “why?” questions, and I’m willing to bet that in many cases it won’t take long for the answers to stop making sense.
Love thy neighbor. “A Logistics person, a Procurement person, and a Sales person walk into a bar.” This could be the start of a very funny joke, or a police report. I’ve conducted countless think tank sessions with logistics executives over the years, and regardless of the topic being discussed, these gatherings inevitably turn into venting sessions (at least for a few minutes) about how folks in procurement, sales, and merchandising make their lives so difficult. The root cause of this frustration, of course, is the misalignment of performance metrics between these functional groups. My advice: Call Dr. Phil to moderate a cross-functional team meeting so that everyone can get their feelings out, wipe the slate clean, and come up with performance metrics that align and reward their efforts for the common good of the company. If Dr. Phil is not available or too expensive, resist the temptation to invite Jerry Springer.
Garbage in, garbage out. Yes, this is the data quality problem, “the Achilles’ Heel of supply chain management,” that I’ve written so much about (most recently here and here). Like complexity, poor data quality is something that many companies have accepted as a fact of life, something they prefer to deal with than correct. Maybe I should do the same. I’m done fighting this battle.
Read the user’s manual. Many companies probably use only half or less of the functionality available in their supply chain and logistics software. In short, you’ve got more power at your fingertips than you’re aware of, or are ready to use. Take some time to read the user’s manual, or even better, keep your employees well-trained on your systems. More troubling, however, are users that stop using the software because they claim it’s broken-e.g., “The system puts out routes that make no sense, and since I have to manually change everything, it’s just easier to do it by hand.” In most cases, the problem isn’t the software, but the data going into it (see above) or the system settings (e.g., constraints, rates, business rules) that haven’t been looked at or adjusted since the software was first implemented ten years ago. Software solutions are similar to cars: they need regular tune-ups to keep working correctly.
Play the cards you’re dealt. It doesn’t matter how hard you try, or what analysts like me say, upper management will always view logistics as a non-strategic cost center, and you’ll always be near the bottom of the priority list when it comes to capital investment and IT support. The sooner you accept this reality, the sooner you’ll be able to find ways to succeed despite it all.
Well, there you have it, my 1-page logistics book. Sure, I could have included other insights, like how it’s hard to make money in logistics, which is why I should get back to writing my novel. Writing a best-seller is a long-shot, but I know I have it in me, even if it takes me another decade to write, one page at a time.
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2 Comments
March 27th, 2009 at 7:18 am
You had me in full agreement until the last point. The great performing companies avoid the last trap. They do manage to get logistics into the “strategic growth” discussion as opposed to let it be viewed as an operation cost and necessary evil. It’s probably the biggest challenge senior logistic professionals have with their chief executives. If the head of logistics (or supply chain) isn’t setting at the management table along with sales, marketing and finance, then the company is most likely doomed to mediocrity.
March 27th, 2009 at 10:45 am
Lehigh81,
I don’t disagree with your point. It’s what us analysts have been saying for years. Unfortunately, at least in my experience, companies that “avoid this trap” are the exception instead of the rule. But perhaps I was a bit too harsh. What I wanted to convey is this: yes, logisticians should keep trying to get a seat at the management table, but don’t use your current situation (e.g. lack of IT support) as an excuse for inactivity. Keep looking for ways to succeed despite the obstacles.