For any retailer in the 21st century not only to thrive but to survive they have to look at integrating their supply chain and streamline their operation to yield maximum results
2. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGES OF SUPPLY CHAIN
EXCELLENCE
Building of bridges between current and desired performance
3. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
Dimensions / Critical Success Factors
1. CUSTOMER
SERVICE
MANAGEMENT
2. STRATEGIC
BUSINESS
PLANNING
3. SUPPLY
INTEGRATED
TO S&OP
4.
WORKPLACE
CULTURE &
LEADERSHIP
5.
RELATIONSHIPS
WITH SUPPLIERS
& SERVICE
PROVIDERS
6.
INFORMATION
CAPABILITIES
7.
FORECASTING
& DEMAND
PLANNING
8. KPI
MANAGEMENT
&
MEASUREMEN
T
9.
IMPROVEMENT
FOCUS WITHIN
BUSINESS
10.
INNOVATION
11.
ORGANISATIO
NAL
STRUCTURE
13.
ELECTRONIC
COMMERCE
4. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Handle each
transaction
seperately
Oil the squeaky
wheel
Adhoc operational
focus
1. CUSTOMER SERVICE MANAGEMENT
STAGE 2
All customers
treated same
Focus on internally
set goals
Limited service level
appreciation
STAGE 3
Strategic customer
get special
treatment
Order, line, unit
service level and
customer’s first
request understood
STAGE 4
Segmented
customer service
plans based on
updated customer
policy
Customers choose
service level and
pay
5. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Fragmented ad hoc
informal planning
Removed from
operations
2. STRATEGIC BUSINESS PLANNING
STAGE 2
Done infrequently
but provides some
Supply Chain
direction
Functional scope
One year horizon
STAGE 3
Limited functional
supply chain scope
1-3 year horizon
Formal process
Major decisions
tested against plan
STAGE 4
Integrated SC Plans
drive decisions and
actions
Includes suppliers
and customers
1-5 year horizon
6. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Focus on today and
each transaction
No idata integrity
3. SUPPLY INTEGRATED TO S&OP
STAGE 2
Period (e.g.
monthly)
Budget period
based
Not Senior
Management driven
No S&OP KPIs
STAGE 3
Annual deployment
Long lead time
issues planned
separately
Senior management
driven & KPIs drive
actions
STAGE 4
Rolling periods
Structured & Formal
Synchronized
across and down
business
Includes capacity
planning 1 to 2
years out.
7. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Employees Vs
Management
4. WORKPLACE CULTURE & LEADERSHIP
STAGE 2
Limited employee
involvement &
consultation
Management sees
people as important
but not vital
STAGE 3
Consultation but no
real involvement in
decision making
Understand culture
Some management
by fact
STAGE 4
Management by fact,
empowered high
performance teams.
Shared goals &
reward.
Sharing of valuable
data given
KPIs aligned to
goals
8. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Unmanaged
Crisis Driven
Adverserial
Cost Only
5. RELATIONSHIPS WITH SUPPLIERS & SERVICE
PROVIDERS
STAGE 2
Price driven
Multiple sources
Competitive bid
oriented
STAGE 3
Some strategic
Alliances
LIfe cycle costing
considered
Evaluation tools
used
Some information
sharing with
suppliers &
customers
STAGE 4
Supply & demand
aligned strategically
Partnering joint
planning &
improvement
programs
Long term
relationships
Partner
electronically linked
Strong collaboration
9. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Transaction Focus
Limited Data
No Analysis
Capability
6. INFORMATION CAPABILITIES
STAGE 2
Report Period’s
Financial Results
Fragmented Data
Limited Extraction &
Analysis Capability
STAGE 3
Useful data
Capability to drill
down
Analysis capability
STAGE 4
Real time, visible
data across
business
Electronically
connected to other
SCs
Flexible extraction
and analysis
People trained to
use it
10. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Gut Feel Or Naive
Approach
Informal Forecast Of
Little Use
Budget Cycle
7. FORECASTING & DEMAND PLANNING
STAGE 2
Some Forecasting
No Ownership
No Integration
Quarterly Cycle
STAGE 3
Some integration
Some analysis from
forecast
Clear ownership
Limited focus on
outcome
STAGE 4
Single universally
used forecast
One version of the
truth
Detailed analysis
and accuracy
Appropriate
techniques for SKU
groups
Part of overall
planning
11. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Financial Focus
Only, Mostly Budget
Complaints Driven
No Data Available
8. KPI MANAGEMENT & MEASUREMENT
STAGE 2
Mostly Financial
Some Operational
Functional Focus
Some Data Available
But Not Driving
Business
STAGE 3
Cross functional,
balanced KPIs
Service vs key
customer
requirements & cost
KPIs
Longer range actual
targets
STAGE 4
Balanced cross
functional scorecard
Integrated across
and down the
business in real time
to enable decision
making
12. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Quick Fix ‘Stop The
Bleeding’
Crisis Management
No Improvement
Focus
9. IMPROVEMENT FOCUS WITHIN BUSINESS
STAGE 2
Cost Reduction
No Strategic Focus
No Alignment
Across Business
Competitive KPI
Benchmarking
STAGE 3
Seeking
breakthrough
change
Re-engineering
Structured approach
Some process focus
STAGE 4
Continuous
improvement
towards goals
process driven
benchmarking
Projects aligned
across business
Business is
outcome driven
13. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Products do not
match capability
Support required for
successful
introduction
10. INNOVATION (INCLUDING PRODUCT
DEVELOPMENT & SERVICES
STAGE 2
R&D Activities
Problems In
Manufacturing
*Marketing
Long Lead Times
STAGE 3
R&D seen as driver
but other functions
not involved
No commitment
STAGE 4
Formal cross
functional
innovation driven by
internal & customer
research
Short development
lead times
14. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
No Method To
Determining
Structure
Ad Hoc Changes
No alignemnt of
roles &
responsibilities
11. ORGANIZATIONAL STRUCTURE, ROLES &
RESPONSIBILITIES
STAGE 2
Some Functional
Planning Used
Limited Alignement
Of Roles &
Responsibilities
STAGE 3
Some cross
functional planning
used to determine
structure
Consideration of
external supply
chain & customer
Alignemnt of roles &
responsibilities
STAGE 4
Structure
determined &
implemented
according to cross
functional business
requirements.
Alignment of roles &
responsibilities
Customer included
in analysis
15. S TA G E S O F S U P P LY C H A I N E X C E L L E N C E
STAGE 1
Limited Ecommerce
No Strategy &
Deployment
12. ELECTRONIC COMMERCE (INCLUDES EDI)
STAGE 2
In Some Parts Of
The Business
No Formal Overall
Planning & Analysis
Of Ecommerce
Strategy
STAGE 3
Strategic Planning
For Deployment
Based On CBA
Ecommerce in many
parts of the
business
STAGE 4
Integrated strategy
& deployment
Enables real time &
management by
exception
Cross functional
processes are E
enabled