Daily Archives: July 6, 2009

Was China Ever Worth It?

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A recent article in the Supply Chain Management Review covered a recent AMR survey across 133 manufacturers and retailers with over 5 Billion in revenue each and asked them about their sourcing plans from China. The survey found that manufacturers, who believe China contributes the most risk in 12 of 15 categories, are now 2-3 times more likely to decrease sourcing in China.

Nothing against China, but it’s about time. I’ve been against needless global sourcing since day one. Most of the time it just adds time, cost, risk, and, because of the dismal state of pollution control in the ocean shipping industry (which accounts for 4% of all emissions that contribute to climate change globally), pollution. And it wastes limited petroleum reserves. (The stuff takes millions of years to form under the earth’s surface, thus, at any point in time, the total amount available, even if we don’t know how much there is, is limited.) We can get the same quality of VCR or DVD player from Mexico, quicker, with reduced costs in a number of categories, with less risk, and less pollution.

Now, I’m not against global sourcing … some raw materials just aren’t available in sufficient quantities on all continents, each continent has a different growing season (and greenhouses aren’t as cheap or green as you think they are), and sometimes there are only a few places that can produce a new product. In these cases, you should definitely be global sourcing. But you shouldn’t be global sourcing just because it’s the lowest cost today … you should be global sourcing because it’s the best option, and value, over the long term.

System Implementation Tips from the SSON

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Every technology implementation is a disaster waiting to happen (and many actually end up that way in practice) — and this goes double in supply chain where millions of dollars could be riding on every transaction. Success requires good project management, good change management, and eternal vigilance. And a few tips every now and again don’t hurt. Here are ten tips for system implementation, courtesy of the SSON.

  • Keep Focus
    Avoid scope-creep like the plague. While it’s important to keep track of good ideas that arise and, if time permits once the base implementation is complete, implement a few of them, scope-creep can kill a project within weeks of its start.
  • Optimize from the Beginning
    What’s the primary task for the system? And how do you make that task as quick and easy to do as possible?
  • Get Buy-In
    A system that no one uses isn’t useful. Make sure your users are on board with respect to utilization and training.
  • Get the Right Team for the Job
    Would you hire a plumber to wire your house? A lawyer to diagnose a health problem? So why would you hire a consumer Web 2.0 expert to implement your ERP system?
  • Don’t Forget the Users
    Once you’ve got buy in, be sure to keep them informed and involve them in important decisions. Otherwise, that buy in might disappear by the time the system goes live.
  • Beauty is Not Truth
    Usually, you have a choice, due to time and cost constraints, between a system that looks good and a system that works good. Hopefully you know how to choose the right one.
  • Don’t Be Too Rigid in the Schedule
    You never know everything when you start a project. Some phases will take longer, some phases will finish faster. Have the necessary flexibility.
  • The Budget is Golden
    While some flexibility is required where the budget is involved, you have what you have and you need to keep that in mind at all times.
  • Communicate, Communicate, Communicate
    The best way to keep your users excited is to communicate constantly, showing that you’re not forgetting them.
  • Go All the Way
    The implementation is not complete until the goal is accomplished. Which is not a live system, but a live system that does what it was supposed to do.