SCL HUB January 2019

1. Digital lemming or leader?
Enabling supply chain productivity
through digitisation
Jan Godsell
Professor of Operations & Supply Chain Strategy
WMG, University of Warwick

2. 1. Lemming or leader?
2. Supply chain productivity
3. 4 strategies to digitise supply chains
3 things…

3. Lemming or leader?

4. A lemming …

5. 1. Stick to a plan
2. Know your goals
3. Pick a strategy that aligns with your goals
4. Minimize your risk
5. Don't succumb to greed or fear
6. Understand your SC personality
7. Stay within your SC comfort zone
8. Stick to your SC approach
9. Don't get sucked into the hype of ”SC porn" (media, publicity and advertising)
9 strategies to avoid being a SC lemming…
After https://www.investopedia.com/terms/l/lemming.aspAfter

7. 1. Drive change and improvement
2. Increase performance and productivity through change in all areas of the supply chain,
from design to processes
3. Help the supply chain adopt new patterns of operation by improving relationships and
trust between people, and innovation in processes
4. Overcome the doubt of others through good performance, insight, careful planning,
good timing and growing team loyalty
5. Prioritize the mission of the organization
6. Use available resources, talent and opportunity to execute the organization’s mission
7. Are accountable for the vision and its execution
7 roles of supply chain leaders

8. Supply chain productivity

9. ‘Supply chains
compete, not
companies’

10. What is the digital supply chain?

11. 4 sub-dimensions with 4 levels of digital readiness…

12. ＞Level 3 digital readiness
predicted to more than
double to 31% by 2023
Only 13% companies
currently at level 3
readiness

13. 4 strategies to digitise
supply chains…

14. 1. SC core process optimisation

15. Competing through process excellence…
YOUNGER FAMILIES STRIVING FAMILIES MATURE 50+
Shop Direct to stop Littlewoods
catalogue after 80 years
Littlewoods to stop printing
catalogue and focus on websites
due to internet shopping revolution
Catalogue circulation
Peak: 25 million
2010: 5 million
2015: 300,000
“This is a big step in Shop
Direct’s transformation
and, importantly, it’s one
that’s been led by our
customers. They’ve
embraced online at a
phenomenal pace – this is
where they’re browsing
and where they’re buying”
Alex Baldock, CE, Shop
Direct (May 2015)
＞Explosive growth
＞Very largest
brand 80.7bn
＞Heritage propositions
＞Limited growth online
＞Huge market
potential
＞Double digit growth

16. Supply chain comprises of 5 core processes…
Source: Supply chain council (www.supply-chain.org)

17. Translate into a
series of operational
processes…

19. Most companies are currently
only leveraging their data infrastructure…
＞Starting to embark on
the collection of data
from new sources

20. 5 steps to SC core process optimisation…

21. 2. SC business process optimisation

22. Customer relationship management process
⚫ Selecting and qualifying desired
suppliers
⚫ Establishing and managing in-
bound logistics
⚫ Designing and managing internal
logistics
⚫ Establishing and managing out-
bound logistics
⚫ Designing work flow in product/
solution assembly
⚫ Running batch manufacturing
⚫ Acquiring, installing and maintain-
ing process technology
⚫ Order processing, pricing, billing,
rebates, and terms
⚫ Managing (multiple) channels
⚫ Managing customer services such
as installation and maintenance to
enable product use
Product Development Supply Chain Customer Relationship
Management Process Management Process Management Process
⚫ Identifying potential new
customers
⚫ Determining the needs of existing
and potential new customers
⚫ Learning about product usage &
application
⚫ Developing brand and positioning
strategies
⚫ Developing/executing a & p progs
⚫ Developing/executing service
programmes
⚫ Developing/executing sales
programmes
⚫ Acquiring/leveraging information
technology/system for customer
contact
⚫ Managing customer site visit
teams
⚫ Enhancing trust and customer
loyalty
⚫ Cross-selling and upselling of
product service offerings
Christopher after Srivastava et al, 1999
⚫ Ascertaining new customer
needs
⚫ Designing tentative new product
solutions
⚫ Developing new solution proto-
types
⚫ Identifying and managing
internal functional/departmental
relationships
⚫ Developing and sustaining
networks of linkages with
external organisations
⚫ Coordinating product design
activities to speed up business
processes
3 core business processes

23. 1. Have customers for whom they create value
2. Typically cross functional boundaries
3. Draw upon functional resources
4. Are team-based
5. Have strategic goals
5 characteristics of business processes

24. A business process
orientation is fundamental
to maintaining strategic
alignment…
Source: WMG & JDA Study on SC Segmentation (2016)

25. Leveraging bedrock of operational excellence

26. Functional and regional organisational
structures inhibit end to end SC thinking…
＞Only 17%
respondents had a
business process
orientation as part of
their organisational
design
Source: WMG & JDA Study on SC Segmentation (2016)

27. IBP is the single most important governance mechanism to
close the gap to strategy
＞S&OP lowest performing current dimension

28. 3. SC digital technology pilot

30. Rate of AI adoption set to double in next 5 years…

31. New technology adoption
can be de-risked…
Source: Godsell (2018) after Ansoff (1957)

32. 4. New business models

33. Underpinned by
more substantial
and inter-connected
trends…
＞Improved
productivity

34. ＞Dimension where
the highest % of
respondents (64%)
wished to achieve a
level 3-4 strategic
outcome (purpose)
Changing nature of manufacturing footprint
reflected in network design result…

38. Concluding thoughts

40. Use the 4 strategies to
be a supply chain
digital leader…

41. @JanGodsell
@WMGSupplyChain
#SCinPractice
j.godsell@warwick.ac.uk
Keep in touch…
Next SCIP networking event: Tuesday 12th March 2019, 08:30
Skills Readiness for Industry 4.0
http://www2.warwick.ac.uk/fac/sci/wmg/research/scip/networking