On the Third Day of X-Mas … (Three Sides to the Supply Chain)

On the third day of X-Mas
my blogger gave to me
tri-focal lens,
two boxing gloves
and a lesson in strategy.

When coming up with a good strategy for your supply chain, one of the very first things you need to understand is that there will always be three views of the best decision: the procurement view, the logistics view, and the executive view. Your number one challenge could easily be the transformation of these viewpoints to a common viewpoint that permits a common solution.

This will probably require a lot of good negotiating skills, good listening skills, and innovative problem solving skills to propose designs and solutions that can appease everyone’s desires. This is where Jason’s Emotional Intelligence (or EQ) really comes into play. You have to see their viewpoints, understand their perceived problems, get to the real issue, and come up with solutions that will simultaneously meet your needs and theirs.

Management will typically want the solution with the perceived lowest cost or highest profit, or both; logistics will typically want the solution that makes their life easiest; and you should want the solution that meets the needs of your stakeholders – engineering, marketing, etc. – while keeping your costs down. A narrow focus on lowest cost can lead to quality issues, a narrow focus on the easiest solution (local sourcing enabled by a national carrier that can meet all of your shipping needs) can overlook lower cost or higher quality sources of supply, and a narrow focus on minimally meeting your shareholder’s needs in a cost-controlled manner can overlook opportunities for innovation.

So not only do you need to be able to understand each of these viewpoints, you need to be able to see their strengths and weaknesses so that your team can collaboratively design an over-arching supply chain strategy that exploits all of the supply chain strengths available to you while blocking out the potential weaknesses.