Effective Supply Chain Collaboration: Tips For a Lean Operation
"_____n" (often followed by "on," "with," etc.)
Definition 1: the act of working with another or others on a joint project
Definition 2: something created by working jointly with another or others
Definition 3: the act of cooperating as a traitor, especially with an enemy occupying one's own country
Struggling? I’ll give you a hint. It’s something you may hear from your customer or tell your supplier. Yet, its true form is rarely found in business. The word to which I’m referring is collaboration. The concept is simple; work together for the benefit of all parties involved. However, “collaborating” is often nothing more than our customers mandating year over year cost reduction; pushing problems back up their Fulfillment Streams or providing unclear direction due to being misaligned internally. By the end of this blog post I hope to provide you with: 1) insight as to why companies struggle to be collaborative by nature and 2) ideas on how to be successful at collaboration efforts.
Why do we struggle to collaborate?
We say we want our solutions to be “win/win” but we don’t mean it. We do not truly work towards solutions that are “win/win”. In reality, we work towards solutions that meet our objectives and then try to convince our suppliers that it’s also to their benefit.
Our measurement systems are not collaborative in nature. Our measurement systems tend to be vertical, not horizontal. Functional or department managers are focused on their metrics and not incented to improve the overall performance of the business.
Short term pressure trumps long term thinking. Even though we often know better, pressure from our superiors, shareholders, and Board of Directors puts heavy emphasis on short term results and does not value long term thinking.
Our operations are unstable so we don’t have time for improvement work. In order to collaborate with our supply chain partners we need to have capacity to do so. If our operations are unstable and we are struggling just to make it through the day, then we cannot focus on improvement work.
What are some collaboration tactics?
Going to the Gemba: The reality is that we do not truly understand each others’ operations. We make requests or even mandate that which may be of little or no benefit to us but significantly hinders our suppliers’ operations. We need to spend time at the Gemba understanding how each others’ operations currently run. A slight change in one of our requirements might enable our supplier to be significantly more efficient.
Sharing information and providing visibility into our business: If we are truly collaborating then we share information as soon as it is available. We recognize the benefit of being connected and provide visibility to new products, change in strategy, inventory levels, production schedules, forecasts, and anything else that may be value-add.
Building relationships: People buy from people. That will never change so we need to spend time investing in our relationships.
So what is stopping you from collaborating? Going to the Gemba? Building relationships? Those are easy ones. Pick up the phone, dial one of your strategic partners, and schedule a visit to their operation. When you are there, walk the operation. Watch how one of your orders flows through their fulfillment process. When you see them doing something that does not add value to your organization, stop, and ask them why they are doing it. At the end of your visit, spend some time discussing what information you could provide to them that would help reduce lead times or provide better service to your organization. Repeat the process with another strategic partner and enjoy watching the waste being removed from the value stream.
Written by Kevin von Grabe, Vice President of Lean Deployment at LeanCor
- Collaboration in the Supply Chain, Where is it? (customerthink.com)
- CSR Meets Supplier Development to Drive Savings/Beat Chinese Competitors: WSJ Coverage (spendmatters.com)
- Benefits of Collaboration for Supply Chain Management (brighthub.com)
Posted by LeanCor Supply Chain Group
LeanCor Supply Chain Group is a trusted supply chain partner that specializes in lean principles to deliver operational improvement. LeanCor’s three integrated divisions – LeanCor Training and Education, LeanCor Consulting, and LeanCor Logistics – help organizations eliminate waste, drive down costs, and build a culture of continuous improvement.Facebook LinkedIn Twitter Google+