The rise of big data, SaaS and advancing Supply Chain Management software (SCM) have all come together to drive corporations to take the next technological plunge. However, it might surprise you to know that there are a lot of old-school tricks you can still use when building up your own tech-driven Supply Chain Network.
#1. Trust in your established connections.
It is often assumed that you might have to part ways with some partners because they cannot work well with the technologies you are incorporating in your new network (such as blockchain). On other hand though, sometimes it is your old ties to your current setup that can lead the way to a reliable, cost effective and preferred vendor.
Take this case of Ryder, a fleet a management service, who ended up working with Tacton, a lesser known configure, price and quote (CPQ) application vendor despite looking through some of the bigger names in the space. One of the reasons that convinced them to work with Tacton was the simple fact that it had also partnered with Salesforce, another vendor who was a familiar presence in their own network.
It is a classic example of knowing the right people and this can still occur within your own sphere. When pushing for more technology initiatives, there is no harm in still consulting the parties you may already know. It will save you the trouble of wading into unfamiliar markets and save precious time in decision-making.
#2. Don’t hesitate to reach out.
Just because you are automating a lot of supply chain processes doesn’t mean you should automate the fine art of actually reaching out to consultants and resource persons. There is no software for teleporting you in front of the talented individuals and experts you will need to transform your current supply chain. The only difference is that you will be using email and social media as much as the well-timed phone call to contact them.
There was certainly no science-fiction shenanigans when Uber Freight brought in veterans from other major software giants. It simply had the ambition to make its global initiatives known and was eager to have the best people on board to achieve those goals. (And so far, it already boasts a lot of Fortune 500 shippers amongst its customers.)
Despite the great dominance of the internet, it has only empowered the age-old efficiency of stepping forward to bring in the right people.
#3. Undertake a Due Diligence
Just like any new system acquisition, new technology, a due diligence needs to be done. Do you have a standard process in your organisation for how a due diligence should be completed? If so, that’s great. If not, you need to find one and start to use it. Ideally though this due diligence includes the following at a minimum::
- A review of your needs, wants, desires and wish list, deal breakers,(what attributes must this system absolutely have),which suppliers offer products that would work, pricing and structure, value added, and our preferred solution. A review of which companies have it in place already,(ideally same industry), how they use it, a review of the supplying company’s performance and an assessment of it’s long term financial future,(financial reports and challenges, liquidity) previous experience with this supplier, suppliers previous supply record with your co and associated companies, relevant product or service lines(to determine whether this client is also providing competitive services,), org chart and how and where you will be serviced and where you will fit, customer information(who are their biggest existing customers and how do these customers compare with you. Are they so large you will be ignored, or are you big enough to ensure that they service you efficiently and effectively.)
- Some other items, may include:
o A description or copy of the Company’s purchasing policies.
- A description or copy of the Company’s credit policy.
- A schedule of unfilled orders.
- A list and explanation for any major customers lost over the last two years.
- All surveys and market research reports relevant to the Company or its products or services.
- The Company’s current advertising programs, marketing plans and budgets, and printed marketing materials.
- A description of the Company’s major competitors.
- And the list can go on and on.
The single most important element of this due diligence is the discussion you will have with one or two of this suppliers existing clients. You will ask them everything you can possibly think of from their vision, mission and values and progress on achieving their mission and vision, to how effectively and efficiently they install the solution, how they are at regular servicing and upgrades, what issues have they had with the supplier and how did they handle the resolution of those issues, are they indeed all resolved. Ask about how they deal with conflict, how they resolve conflict, the quality of their teams, the accuracy of their invoicing, whether or not they have a process orientation, how well they are organized and how well they are managed, led and run, and most importantly how well they manage the change management aspect of their implementations (All implementations have issues, if the clients says there were no issues, move on to the next client until you know the issues to expect and how you will work with the supplier to resolve them in the case of your implementation. If you cannot find any issues be very skeptical about the level of honesty of these customers. This must influence you negatively towards this supplier.)
Somehow you need to get this all summarized into 2 pages for inclusion in the final contract as a schedule which documents, the selection process and why these guys were selected. Importantly, it’s the link with the past which often gets missed when we are deep into the implementation and the answers to our questions and their promises are long forgotten.
#4. Run tests, trials, pilots
It’s important to have this as a mindset. What if the above proposed solution doesn’t work. How do we build, tests, trials and pilots into our thinking? Are we going to presume that we will ‘do the lot’ at the same time or adopt a step by step approach, that slowly builds with the organization to the whole? Do we need suppliers on probation, where they are severely tested in as much as possible before they are absolutely confirmed as our preferred supplier?
#5. Education and Training, who already has the final outcome in their consciousness?
Finally, the biggest issue you will have is that your team only know how to do things the way they currently do them. They don’t know how to be successful in a ‘new’ way! Who will teach them/.train them/show them how to be successful the new way? Why is this so important to you and the organization that this new way of doing things is adopted? What happens if it isn’t adopted or it doesn’t work? Are there consequences for the organisation that the teams should know. Can this suppliers other clients help you with this very important consideration? What did they do to absolutely ensure success? Why was their implementation successful? Would they do anything differently if they ahd the chance again?
#6. Remember that the goal is still to drive value.
Speaking of which, if there is one grave misunderstanding of about today’s automation is that it is ultimately aimed at taking human agency out of the picture. For supply chain leaders, this could manifest as overreliance on it rather than proper, efficient reliance.
A truly tech-savvy supply chain is still one that remembers its initial goal of delivering higher value in all areas. These include sustainability, cost-efficiency and so on. To have a proper sense of balance between automating a process and improving it with better human insight, the focus on value has always been the key. It does not lie in simply throwing more technology at the problem. Ensure that technology is assisting with the heavy lifting, but it will be a long time before it can strategise, innovate and be creative. Even AI depends on someone, mostly a human, asking the right empowering questions!
In short, today is simply an age where the tools have improved while classic business networking techniques remain relevant (if not enhanced). To better seize the opportunities of today’s supply chain network technology, don’t hesitate to use them when they still work!