Management

Supply Chain Management and Purchasing have a significant effect on the company’s success. With 40 to 80% of cost not only do they often generate the biggest portion, but the increasing level of services further rises their importance.

A Supply Chain Strategy matching the company’s strategy and risk orientation is therefore essential, however not yet commonly established. Projects must fit in this context and have to be managed via an appropriate project portfolio management. Strategically important projects require in addition top management representation on the Steering Board level.

Finance

The interface of Supply Chain management to Finance Departments has become much more important over the past years. Not only are purchasing cost and management of the working capital of common interest, but also the design of the value, goods and information flows regarding Tax, Risks and Performance require close collaboration.

New technologies arising allow for real time data collection and processing which creates new potential areas of collaboration, especially in the simulation area. Despite supply finance models like reverse-factoring or financial supply chain processing like e-procurement are on the rise.

Planning

Planning plays a key role in managing quantities for procurement, production and stocking. This means planning determines delivery capability and working capital and via mid term planning also investment levels. Globalization as well as customer and supplier integration have increased its complexity by factors.

Reliable master data, correct and timely order data and good sales forecasts build the basis for planning. New technologies arising or already available (such as transponders) provide new and faster information, however create massive data loads which IT and the organization has to cope with.

Purchasing

Material cost are a key cost driver in producing industries. As most of this cost is being determined already in development departments during engineering, early stage involvement of strategic purchasing is required. Furthermore globalization has increased importance of transport, customs, order-processing and risk related cost and triggered a need to evaluate cost following a total-cost-of-ownership (TCO) principle.

Exchange of information has become more important not only on the customer’s side, but also on the supplier’s side. Besides demand information recently also compliance related information has become more important.

Production

Outsourcing and dislocation of labour-intense manufacturing processes has influenced production processes in the past decade. Stock levels have been decreased and throughput times reduced, thus vulnerability of the supply chains was increased, further accentuated by the globalization and dependencies from just-in-time deliveries.

Production cost and net working capital are likely to be under pressure also in the future. Supply Chain Management and Production will have to continue their close collaboration to keep up with demands.

Distribution

Supply Chains must match customer demand regarding availability, quality, cost, reaction time and information levels, risk and sustainability – one-fits-it-all strategies are doomed to fail. A profound understanding of customer segments and their specific needs is therefore required. Despite reasonable demand data is needed from Sales.

One of the biggest cost-drivers for supply chain cost is the product portfolio. Well managed portfolios offer big potential, but require involvement of top management, sales and marketing departments and good empirical evidence.

IT - Integration

Timely, reliable information was always essential for supply chain management. The shortened development, procurement and production cycles of recent years despite global collaboration partnerships have accentuated the importance of Information Technologies.

The IT - systems robustness and reliability also with regards to security and compliance topics has become a critical factor in the age of cloud and mobile computing. The high dynamics in technology and environmental factors development makes close collaboration of IT and supply chain indispensable. Who wants to compete in the future should have an edge in the field of services.

Strategy

As Supply Chains significantly influence value add processes and cost, supply chain strategy and projects must match the company’s strategy. Aligning expected performance, value drivers and risk orientation early on is required.

Sometimes though Logistics- and Supply Chain functions speak another language than the primarily on the financial results oriented Management – or senior management has simply not enough time to involve.

PI4SC can help you in definition and communication of supply chain strategies and concepts.

Interfaces

Nearly all supply chain related projects, requirements, portfolios or strategies require close collaboration with other departments or experts. This seems obvious for line functions in Operations and Supply Chain.

Depending on the topic in scope, often involvement of Management, Sales, Marketing, Finance and IT is in addition necessary. It is quite common that project managers fail in or even avoid establishing good communication to those functions.

PI4SC can support your project management in communication and handling of interfaces that are critical for success.

Project Portfolio

Naturally resources are limited. It is therefore essential to assign money, work force and know-how effectively. This requires focussing on strategic relevant topics and skipping out commercially or technically less attractive ideas early.

Project Portfolio Management builds the foundation for this process and creates transparency.

PI4SC can support you with business cases, risk assessment, selection or planning of programs.

Requirements

A study from the British Standish group suggests, that over 50% of failing projects failed because of insufficient requirements.

Appropriate methods combined with professional competence and early involvement of a project’s customers are necessary to collect requirements. Iteration from the big picture down to the details with early discussion of the solution architecture (e.g. IT) and focus on risky topics improve efficiency and success chances.

Project Managers sometimes though are more familiar with project management methodology and less with business topics and requirements collection methodology.

PI4SC can enable your project experts in requirement engineering and thus improve your projects success chances.

Interviews

Face-to-face talks with management, experts and possibly customers of the project intend to evaluate expectations and concerns regarding a project. A good mutual trust is therefore important, as in this phase often target conflicts or serious concerns are detected. At this early stage those can be resolved much easier than later on – and at substantially lower cost.

Time expenditure is mostly small, duration however varies usually depending on management’s availability. The interviews are an important basis for the later defined project goals and the project order.

Analysis

The situation analysis targets the methodical examination of the actual idea and usually consists of a problem analysis, an as-is-analysis of the system in scope, the root cause analysis for problems and the environmental analysis. Scenarios can potentially help to discuss alternatives for the project or the business itself.

Important seems a holistic analysis of the problem, the determination of degrees of freedom and the foundation of an information basis for target formulation and solution development. Existing solution ideas will be considered and written down in this context.

Strategy

Each project needs a clear, value focused vision on what shall be achieved. An implementation approach and clear, understandable, quantified Targets are to be formulated. Targets can be related to the project itself (cost, time, quality, scope, …) or also describe the to-be-situation after the project (revenue, cost, customer satisfaction, process cost, process quality, …)

Targets are written down in a target matrix and monitored during the project. To define minimum, expected and exceptional target levels is valuable. Minimum targets can in some cases also act as potential exit criteria during a project.

Solution

In a next step, high level requirements are collected from project customers. Workshops involving representatives of areas in scope are effective. Afterwards experts of implementing departments can develop solution ideas, which than will be evaluated regarding their suitability to achieve the goals and comply with known restrictions. All of this should lead into a solution proposal towards management. Only after this step, details will be defined.

It is beneficial not to be too detailed early on, but to allow for iterations. Like this, valid, implementable solutions can be developed efficiently – or a proposal to change goals or even stop the project.

Implementation

Implementation requires appropriate planning. Well planned work-packages including their dependencies on the time axis are more significant to success than later planned activities on task level. Even for smaller projects it is important though to establish a risk plan.

Clearly defined responsibilities and communication channels combined with assignment of sufficient and qualified resources enable success. If furthermore early focus on usability, open communication and high quality standards are applied, than only documentation and user training will at the end complete the work.

Keeping know-how in-house by assigning an internal project manager should be the goal, even if you have to let him coach by an external person.

Success

Well set-up projects have better success chances. They still require attention in monitoring of progress, goal achievement and risks and potentially mentoring in case of less experienced project managers.

Innovative projects have in general higher uncertainties and success chances are smaller, but also for those good preparation is key – for instance clearly and early defined success or failure criteria allows exiting at defined milestones, which can avoid unnecessary spending’s and frustration levels in the organization – and this is to be considered a success as well.

Methodological Competence

I was lucky to work with excellent experts in various areas for years and by this learned from their knowledge and expertise.

Using my business administration and engineering education in challenging environments and the related close collaboration with board members have sharpened my analytical and strategic thinking skills.

The combination of all allows me to adjust methodology to the problem in scope. This can be very effective – to your benefit if you wish.

Business Understanding

Managing line functions for years allows me to often well assess applicability of solution approaches.

Experience in daily contact with customers has in addition helped me to establish a high customer focus.

Especially when it comes to strategic topics and requirements I have a good sense for reasonable and doable projects – to your benefit if you wish.

Hands-On Experience

Over the past years I have lead various projects in the supply chain area. Topics covered ERP Roll-outs, process analysis and definition, variant management, product portfolio streamlining, supply chain re-design and more.

In many areas I am capable to avoid troubles and cost for you or to support you in breaking new ground – to your benefit if you wish.

Your Partner

You are looking for a senior Expert for your pending supply chain projects and somebody who can communicate with both management and implementing levels across departments. You have rather complex topics with maybe innovative character for your company – than I can support you.

I am open to a clarifying conversation to figure out how – please don’t hesitate to contact me!