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Supply Chain is all about integrated approach, a team work and about collaboration. We hear motivational speeches about team spirit. Teams, Teamwork, Team spirit, are these just a bunch of fancy words or do they mean anything to Supply Chain Success? They do mean a lot. Let us pause for a moment and understand what “team spirit” is. In simple, “the spirit of a group that makes the members want the group to succeed”. In summary this definition is about three words, a group and their passion and third and important word is success. So in simple, team spirit is about motivated team working towards success with a common goal. Now it makes sense to know how critical team spirit to supply chain is. As mentioned earlier, success of any Supply Chain largely depends upon collaboration and team work; because supply chain has many facets which are integrated and an independent approach would defeat the very objective of supply chain.
Harland felt that supply chain is about management of network of activities involved in delivering a product or service, “Supply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers” (Harland, 1996).
Supply Chain is a process/system that manages customer order from receipt to delivery through its network of related activities that have primary focus to manage seamless flow of information, product and also cash flows. Apart from managing product, information, and cash flows supply chain would target maximization of return on investment to the shareholders. In order to maximize profitability of the organization, all functions/activities within supply chain should have common goal and work as a team collaborating with other functions within the business. Let us understand how all activities within supply chain can be integrated.
In any supply chain the following activities will handle or participate in a team effort to transform the order into a product/service that matches with customer expectations and delivers profitability to the organization.
In order to understand why a fragmented approach will not deliver targeted efficiencies of supply chain, let us understand the activities of each function and examine how they are aligned to the common goal. From the below given graphic one can understand all functions within supply chain are connected and work in tandem.
However, the crisscrossing lines may confuse some. In simple the arrows indicate functional integration within supply chain collaborating and exchanging critical supply chain related information and working unitedly towards common goal.
Let us examine each functional activities and how they work in tandem with other function to achieve the common goal.
Planning: Planning’s main objective is to ensure right product is made available to sales team at the right time and at the right place. In simple, planning team is responsible for product availability planning. It works with other functions as explained below:
Procurement: Component Planning, Life Cycle Management, Demand Planning etc.
Logistics: Inbound Logistics, VMI Planning, Milk Runs, Outbound Logistics, Distribution etc.
Manufacturing: Production Planning, Product Life Cycle Management, etc.
Customer Service: POS information, Product Availability, Order Execution etc.
Procurement: Procurement team aggressively work towards achieving low per-unit Costs for raw materials and supplies. It coordinates following activities with other functions within supply chain in order to achieve their objectives.
Planning: Component Planning, Life Cycle Management, Demand Planning etc.
Logistics: Inbound Logistics, VMI Planning, Milk Runs, JIT Delivery etc.
Manufacturing: Component Requirement, Product Life Cycle Management, etc.
Customer Service: Customer feedback, Product Availability in case of CBU etc.
Logistics: Logistics team’s main function is transforming planning into action and in the process managing time related positioning of resource economically. It works collaboratively with other functions in the following areas:
Planning: Inventory Carrying Levels, Finished Goods Distribution, Inbound Logistics etc.
Procurement: Milk runs, VMI Management, JIT deliveries, Inbound Logistics etc.
Manufacturing: Component delivery, finished goods Warehousing & Distribution etc.
Customer Service: Product Availability, Order Delivery Status etc.
Customer Service: The main objective of the Customer Service Function is to coordinate effectively with customer with regard to their order and make sure that the customer is well informed about the delivery of product or service. In simple exchange of information is the key function. In order to deliver the right information to the customer, they work closely with the following functions.
Planning: Share point of sales (POS) information, Customer Order Fulfilment, Customer feedback etc.
Procurement: Customer Orders, Procurement cycle time in case of CBU etc.
Logistics: Order status, Product Availability, Customer Expectations and Product Delivery status.
Manufacturing: Customer Order flow; Product availability, Product supply constraints, Technical Problems etc.
Above are only few examples of coordination. Depending upon the product and organization, supply chain coordination complexities varies. Just for a moment, imagine functions within supply chain working in silo. There is no need to explain the disastrous end results! Supply Chain is a team work like CRICKET. Every one in the cricket team has a defined role with a common goal to win the match. Same way supply chain with many functions, and variety of individual goals work together for achieving the common goal. A fragmented Supply Chain team is like chariot pulled by several horses in different directions and going nowhere. Some examples of a fragmented supply chain:
Martin Hoegl and Hans Georg Gemuenden (July-Aug 2001) have defined team work as, “teamwork is work performed by a team. The quality of teamwork may be measured by analyzing the effectiveness of the collaboration in the following ways:
3. Balance of contributions
4. Mutual support
A sustainable team work is achievable through efficient communication, collaborative coordination, and effective contributions by all with mutual support matched by individual effort. Before concluding let me summarize team work/team spirit. It is all about working together towards common goal and helping each other to achieve their individual objectives at the same time attaining common goal.
“Coming together is a beginning. Keeping together is progress. Working together is success.” – Henry Ford.
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