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How to Unlock Supply Chain Deadlock?

Dr Vijay Sangam, 12:06, 26 Jul 2020

For many decades, several companies have attempted to build seamless supply chain networks to deliver cost-effective products to their customers. Unfortunately, most have simply re-implemented the same old business processes that have been designed many years ago with no fresh thinking. The new normal forced us to think differently under COVID 19 situation.  When we face dead ends or deadlocks, we may have to think inside the box before thinking outside the box.  What is thinking inside the box is a different discussion for a different day.  Today let us focus on how to decode the deadlock or dead ends in supply chain management.

In my opinion, there are three ways to unlock the deadlock, and they include:

  1. Go by your gut feeling;
  2. Theory of elimination;
  3. Gap Analysis.

The first one is to go by your gut feeling – “Creative minds don’t follow the rules; they follow will.” Gut instinct, or intuition, is your immediate understanding of something; there’s no need to think it over or get another opinion—you just know. Your intuition arises as a feeling within your body that only you experience. Because the feeling is so personal, no one else can weigh in to tell you if you’re in touch with your gut instinct or not. You alone have to make the call. Because of this, you are trusting your intuition is the ultimate act of trusting yourself. The process of trusting your gut is not as simple as the phrase implies, though, especially when certain habits and circumstances pull us strongly and often unconsciously in the opposite direction. Luckily, our intuition is so deeply instinctual that even if we’ve been out of touch with it for our entire lives, it’s still there inside of us, waiting for us to summon its wisdom.

The second one is the theory of elimination – “It’s not about the elimination of fear. Rather it’s about the elimination of the feeling that the elimination of fear is necessary before we take the next step.”  One of the ways to use the elimination theory is to use the stand-in-the-circle model.  The value should always see from the perspective of the customer. If our thought process considered as input, the output is still the customer.  To achieve the deliver what the customer wants in a deadlock situation, the supply chain manager should draw a virtual circle around the position and view what is happening around the position. The objective of the circle is observing to collect facts and not to find faults or not validate the productivity of the team. This process also considered as Strategic Supply Chain Management with the ultimate goal of adding value to the business and get unlocked from the deadlock.  By following the model, one will see a variety of issues that could help us resolve the problems such as lack of planning, inadequate procedures, wasted value and time and material, ambiguity among the decision-makers, break-downs, reworks, shortage of material, and wrong inventory. By eliminating what is relevant to the situation will pave the way to the path of success.

The third method is the gap analysis.  If the above model is observing, the gap analysis is a structured process of mapping the business processes and identifying the gaps in the process—the process of bridging the difference between the desired state and current state mapping considered as gap analysis. “The focus of gap analysis should be getting to the other side. If you bend-over to analyse a gap too long, you’ll probably fall into it.”

The four-step gap analysis involves, Where are we now? Where do we wish we were? How are we going to close the gap? And last but not least is don’t leave your gap analysis on the shelf to collect dust!.  In the current situation, we aim to unlock ourselves from the locked position or dead-end condition.  The first three steps help us to understand the current situation, our ideal future state. Brainstorm the gap between the two situations by mapping the existing processes and identify the gaps that are tying-up to the current situation and now allowing us to the future state.  Consider every small aspect that comes to our mind in the process of review. And captivate it, analyse it, and evaluate how it could help us to reach the future state. 

It is not easy having said and done.  To unlock your supply chain from the current state to the desired state by unlocking and decoding the gaps, one has to focus on the appropriate methodologies to achieve the desired results the above three suggestions may not be helpful to every and all situation.  Let us not forget that, “One size doesn’t fit all.”  Finally, thinking inside the box, “The most fertile questions focus the mind on valuable overlooked corners of the universe of possible improvements.”

The ultimate aim of any supply chain is to deliver maximum return on investment. And one of the major factors that impact this goal is inventory carrying through which we tie-up the working capital and current asset becoming a liability. This resulting in indequate operating profits after capital charge.  Here is the data collected by McKinsey & Company on the inventory carrying. Let us not forget that excess inventory kills supply chains

Inventory Carrying
Fun side of Supply Chain deadlock!

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