It was fascinating for me as a young child to watch the Olympic Games and to enjoy the variety of competitions challenging human limits. The motto: “Faster, Higher, Stronger.”
On July 20, the International Olympic Committee approved an update, adding a dash and the word “together.” So it now reads: “Faster, Higher, Stronger – Together.”
This is a significant change — the first since the motto was adopted in 1894.
I find similarities between the Olympic motto and how companies approach supply chain planning: Companies want to drive faster decision making through their S&OP and S&OE processes. Supply chain planning leaders want to enable higher results in terms of revenue, profit, cash flow improvement and stronger internal metrics such as service and speed of innovation. Supply chain planning leaders can’t deliver these results alone — they need to deliver them together with commercial leaders, finance leaders, manufacturing leaders internally and to key customers and suppliers externally.
So, what does it take to deliver this motto in supply chain planning? Each Olympic sport requires the athletes to have a comprehensive program including coaching, medical care, special diet, preparation and so on. Even within the same sport there are variations of this comprehensive program. For example, the 100 meters requires a fundamentally different training program and diet than the 10,000 meters. The outcome is a result of specific targeted interventions in different areas that work together harmoniously. This is the same with supply chain planning leaders! The outcome of delivering business results requires a combination of excellence in process, organization culture, talent attraction and development, and collaboration with other functions.
To provide a comprehensive and adaptable program for supply chain planning athletes, Gartner introduced the supply chain Score model in February. Within that, we defined the key ingredients needed for success. Within supply chain planning, there are five activities that together build a comprehensive program like the Olympics preparation:
- Supply chain planning strategy — The first component is to build a supply chain planning vision and objectives to deliver functional and corporate goals. The second component is to develop the planning culture and instill beliefs, values and customs to shape the desired behaviors. The third component is to define a planning talent strategy that attracts, develops, retains, evaluates and progresses planning talent.
- Supply chain planning technology — Starts by designing the digital roadmap of how planning selects, invests in and deploys mainstream and emerging digital technologies. Then, supply chain planning leaders define standards for developing, deploying and integrating supply chain-based and supply chain planning technologies. And finally, supply chain planning leaders leveraging and executing the technology architecture for supply chain planning systems.
- Supply chain planning organization design — Starting from designing organization structure and reporting lines and leadership hierarchies to developing governance structure to guide decisions and planning process execution for day-to-day activities across the supply chain.
- Supply chain planning performance management — The first element is to develop planning master data by defining gathering, recording and integrating data. The second element is to develop planning analytics to analyze activities and performance across supply chain planning. The third element is to govern planning performance by defining, monitoring and managing supply chain planning and business performance metrics.
- Supply chain planning processes — Start by developing planning processes through detailed design and documentation of processes of supply chain planning and improving them by identifying, executing and driving adoption of process improvements.
The five activities above span all supply chain planning processes: product portfolio planning, demand planning sub, supply and inventory planning, S&OP and S&OE. The comprehensive program needs to adapt to the specific need of the organization based on industry, geographical footprint and size. In one industry, pricing change and promotional planning can cause volatility in demand and therefore needs specific processes in demand planning, supply and inventory planning, and S&OE to address that. In another industry, pricing change and promotional planning may not be the major changes but rather regulatory changes or tender management. That requires a tailor made comprehensive program for that organization.
Gartner provides the framework for the comprehensive program and an assessment tool that Gartner clients may use to identify their current level of maturity. Gartner also provides benchmarking for how your company benchmarks against similar companies in size and industry.
Senior Director Analyst
Gartner Supply Chain
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