Today’s business environment is more volatile than ever, organisations have to conduct business within ever increasing uncertainty of the market place, we have experienced how the coronavirus has affected the entire supply chain. A lean and agile supply chain organization is vital to thrive in uncertainty and enable a demand driven, responsive and cost effective operation. I hope you will find useful this attached introduction white paper that I developed few years ago for Transformation purposes and to provide a basic understanding between the models and differences of a #lean, #agile and #leagile #supplychain #strategy

1. Leagility
Procurement & Supply Chain
Author:
Reza Hagel
Telecom Chief Procurement Officer
Digital Business Transformation Advisor
An Introduction to

2. Table of Content
Introduction
Supply Chain Visibility
Four steps transformation to agile supply chain
- Introduction, Scaling Agility
- Change Management
- Delivery Agility
- Organizational Agility
- Business Agility
Lean, Agile or Hybrid model- Leagile
- Background
- 7 wastes by Taiichi Ohno
- A Demand driven approach
- The decoupling point between lean and agile
- Postponement & JIP
- Lean versus Agile supply chain strategies
- Leagile supply chain strategies
Sources

3. Introduction
Today’s business environment is more volatile than ever, organisations have to
conduct business within ever increasing uncertainty of the market place, we have
experienced how the coronavirus has affected the entire supply chain.
Nevertheless, customers have become more demanding as they seek lower prices,
better quality and quicker delivery.
These external factors have pressured organisations to shorten product life cycles,
adapt new technologies and increase product variety. Supply chain agility is critical
for the survivability of an enterprise within these dynamic and volatile markets. As
such agility is an important dynamic capability within the current business
environment and is perceived as one of the most noteworthy issues in
contemporary supply chain management.
The theoretical basis for supply chain agility is however underdeveloped, as agility
is a complex concept consisting of many elements and there is only limited
literature available adding to the fact that it is characterised by ambiguity.

4. SUPPY CHAIN VISIBILITY
• Using a cloud platform, all sized organizations can today manage the life cycle of collaborative supply
chain plans and the associated data.
• In general these platforms covers 3 main features: a real-time Data Collection Framework that
collects data from partners sites (IoT and legacy systems) and store data into the cloud; configurable
optimization service that propose optimization algorithms for designing a plan; and Monitoring Plan
Execution through model comparison for detecting deviations and propagation of the deviations; agile
adaptation for different deviations; a dashboard for visualize and assess the supply chain situation.
Managing and controling visibility of information regarding flows of products and services in
different levels and directions is vital towards the creation of an agile supply chain. Visibility as
an important contributor to improved responsiveness in order to avoid mistakes in decision
making, the bullwhip effect, excessive inventories and jeopardizing the profit margin.
In these contexts, supply chain visibility is the capability of sharing on-time and accurate data on
customer demand, amount and location of inventory, cost of transportation, and other logistics
dimensions throughout an entire supply chain. It must help enterprises to identify and act upon
the risks and opportunities of their supply chains considering they are confident in the fair usage
of the gathered data.

5. Four steps
Transformation Model to
Agile Supply Chain

6. SCM
Transformation
SCALING AGILITY
Agile (or agility) is more than just a mentality—an alternate state of mind.
Transitioning from ‘doing agile’ to ‘being agile’ requires something other
than just an assortment of practices; it requires an organization to
embrace agility as the way of operation and to thrive.
It requires a new way of living and working for those organizations.
Many procurement and supply chain organizations have been working
mostly separated from the business lines but those days are gone
were the function could deliver results working in isolation gathering
requirements to manage tenders and sign contracts.
The world has decided to move much faster but moving in smaller
incremental steps. This may be a quantum leap for many supply chain
organizations and the challenges faced to make it happen may be
mountain high. Organizations need to develop key expertise, strategies
and methodologies to make the organization’s transformation to agile
smooth, seamless and pain-free.

7. CHANGE MANAGEMENT
SCM
Transformation
Change Management is the first step in your supply chain
agile transformation journey. Starting by setting up the
business objectives and sort out change authority groups
necessary to meet those objectives.
Each change program should be built to fit particular
business lines needs from field-tried change designs
adjusted with change models and agile practices.
Some changes may be global that impact the entire value
chain and supplier network. Some changes may be more
localized such as, Category Management or Contract
Management. Regardless of scale of change, managing
the change in a rigorous way exhibits the discipline
necessary to successfully complete any agile
transformation project.

8. Delivery Agility changes your skilled people into high-performing,
autonomous teams who can deliver cost savings through efficiency
and productivity improvements in a well-coordinated manner. Once
change management captures the entire transformation steps and
flows, supply chain delivery agility bridges the gap between
agile hypothesis and practice.
A supply chain delivery framework that brings life to a nonstop
change plan has to be develop with the aim to:
• Alignment of teams around a shared vision of success
• Rapid delivery with higher quality and reduced cost
• Improved transparency and predictability
• Better corporate and business lines strategy fit in an iterative
manner
DELIVERY AGILITY
SCM
Transformation

9. ORGANIZATIONAL AGILITY
Once change management blueprint is implemented using delivery
agility frameworks, organizational agility brings key leaders of the
organization to advance three fundamental work spaces
— physical, virtual, and mental of every part of the Supply Chain
organization.
Organizational Agility aims to advance a community-oriented
culture leveraging upon organizational advancement, group
achievement, program coordination and continuous improvement.
Streamlined procedures and destroying waste across every
department of the organization to “examine and adjust” as the
organization navigates through changing realities around it.
Leaders should strive to bring organizational agility to their teams
with an aim to transcend the organization into a “learning machine”
that continuously learns from the world around it, adapts and
adjusts its internals and externals to react with every weapon in its
arsenal to win the business objectives of the organization
SCM
Transformation

10. SUPPLY CHAIN MANAGEMENT
BUSINESS AGILITY
SCM
Transformation
• Business Agility aims to bridge any gap between the value chain
and the organization business lines, namely by integrating with the
finance department and alignment with sales and marketing.
• While supply chain agility is only possible through the
collaboration of R&D and Product development, business agility
brings agile administration across the corporation departments to
be aware and leverage whenever possible. Fostering a culture
where rapid delivery engines in IT and product development aids in
rapid-fire marketing, faster sales processes and revenue
realization. Fundamentally, business agility brings innovation and
newer products and services to market faster. Organizations need
business agility experts who brings the non-technical
transformation complimenting organizational agility — completing
the loop and cycle of agile transformation in the most holistic
manner.

11. Lean, Agile or a
hybrid model: Leagile

12. The debate continues over the decision to
develop a lean supply chain, an agile supply
chain, or a hybrid model: leagile.
• Background
Lean supply chain thinking was developed by Toyota to develop their
production capabilities through constant innovation in resource reduction
and utilisation. The ultimate goal of lean thinking is to eliminate waste.
To this end it is necessary to identify and eradicate the 3 M’s: Muda, Mura
and Muri. Muda is work that absorbs resources but adds no value. Mura is
the waste of unevenness or inconsistency leading to an erratic flow. Muri is
to cause overburden, stretching resources beyond their limits.

13. Taiichi Ohno identified 7 wastes that
absorb resources but adds no value
1. Transport: The unnecessary movement of materials and products
2. Inventory: Excess stock held without reason
3. Motion: The unnecessary movement of resources to conduct an activity
4. Waiting: Interrupting the constant flow of material or information
5. Overproduction: Making more than is required
6. Over-processing: Conducting operations beyond the needs of the customer
7. Defects: Poor quality leading to rejects and rework
Taiichi Ohno is considered to be the father of the Toyota Production System,
which inspired Lean Manufacturing in the U.S

14. A DEMAND PATTERN APPROACH
❑ A lean supply chain would benefit an environment where there are high
volumes and predictable demand.
❑ An agile supply chain would benefit an environment where there is a
wider range or variety of items in smaller volumes.
❑ But what if the organisation has a high
variety and volumes are also high?
This is where leagile fits in. A combination of
reduction and response to enable the organisation
to benefit from both scenarios.

15. LEAGILITY – the decoupling
point between lean & agile
• The term leagility separates the lean and agile concept at a strategic point which is known as the
decoupling point. The decoupling point is the position to where the customer’s order penetrates the
supply chain. Upstream from this point lean strategy can be utilised to gain cost-efficient
advantages of predictable demand.
• Downstream of the decoupling point agility can be applied in order to deal with the uncertainty of
the market. The ability to build these leagile supply chain networks has been lagging and has not
developed as anticipated.

16. The philosophy behind this would be to have inventory Just In Progress
(JIP) using postponement opportunities to cut down on waste and still be
able to respond to changes in demand.
LEAGIBLE - POSTPONEMENT

17. The table 1. illustrates the
comparison of attributes
between lean and agile
supply chain strategy by
classifying products into two
generic types, fashion and
commodities.
These two product types
respond to distinctly
different marketplace
pressures and hence require
a different supply chain
approach to address their
specific characteristics
Lean versus Agile
Supply Chain Strategy

18. Leagile Supply Chain
Strategies
Even as these three strategies are
complementary rather than mutually
exclusive, it is likely that each may work
better in certain conditions. Table 2
shows that there are sets of appropriate
conditions for the application of the
three-hybrid, i.e., leagile supply chain
strategies.

19. Sources
• A conceptual framework towards leagility by Arno Meyer, Wesley Niemann, Karlheinz Peckover
• Focus Consulting – Supply Chain Change Management and Transformation Best Practices
• Developing Lean and Agile Health Care Supply Chains by Aronsson H, Abrahamsson M and Spens K
• Responsive Supply Chain: A Competitive Strategy in a Networked Economy by Gunasekaran A,
Lai K H and Cheng T C E
• The Impact of Logistics Performance on Organizational Performance in a Supply Chain Context”
by Green K Jr., Whitten W D and Inman R A
• Six Sigma Deployment in Supply Chain Management: Enhancing Competitiveness by Madhani P M
• Supply chain strategy selection by Madhani P M