Daily Archives: August 4, 2009

Five Secrets of Team Building

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In Why Teams Don’t Work, J. Richard Hackman of Harvard laid bare the five critical conditions that mark the difference between success and failure. Given that these trying times are requiring your team to do more with less and that the ultimate secret of supply chain success often boils down to cross-functional teams managing needs from product inception to final product disposal, successful teams are more important than ever. Here are Hackman’s five basic conditions of effective teams and ultimate success:

  1. Teams Must Be Real
    People need to know who’s on the team, who’s not, and who has what responsibilities. A virtual team or vague team concept won’t get the job done.
  2. Teams Need a Compelling Direction
    Members need to know what they’re supposed to be doing together. Without a clear direction, there is a real risk that different members will pursue different agendas.
  3. Teams Need Enabling Structures
    Teams with poorly designed tasks, the wrong mix of members, and un-enforced norms gravitate towards trouble.
  4. Teams Need a Supportive Organization
    The organizational context must facilitate teamwork in a manner that is conducive to the team and its members.
  5. Teams Need Expert Coaching
    A focus on individual performance does not necessarily improve the team. Teams need to be coached as a group in team processes.

Front-End Loading

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In supply management, front end loading is the coming together of all stakeholders in a multi-disciplinary team to insure that the concept, value, and strategy of a proposed product are worked out well before the design is finalized and production begins. It focusses on front-end planning, and insures that required parts and materials are available and affordable within the target cost.

Front-End Loading is used heavily in Japan where it is seen as a primary contributor to Kaizen (value creation), which refers to the Japanese approach to continual quality enhancement and waste reduction through small, but continual, improvements. It has contributed to a lot of success over the past decade, and the CAPS Research Japan Group recently released a detailed white-paper on Front-End Loading (FEL) that chronicled the result of their surveys in 2002, 2004, and 2006 on FEL and ESI (Early Supplier Involvement) and eleven industry case studies.

The surveys, which also revealed a number of trends in the automobile, electronics, food, retail, and engineering industries, found that supply management experienced a significant change in the first half of the decade from where it had little involvement in product planning in 2000 to significantly increased involvement in 2006. Although some companies don’t involve their suppliers in the early stages of NPD, the involvement is on the rise.

Front-End Loading has contributed significantly to each industry it has been adopted in. In electronics, for example, Xerox obtained an annual 10% reduction in net product cost, a 93% reduction in rejected material, a 50% reduction in NPD time and cost and, most importantly a reduction in production lead time from 52 to 15 weeks and in automotive parts, Mitsuba expects to reduce it’s average product life cycle from seven or eight years to four.

When procurement leads the cross-functional team in the screening and evaluation of potential sources of supply, cycle time is reduced, costs go down, and green purchasing, social responsibility, audit/compliance, and risk management are considered up front. By tackling these timely issues, procurement can be sure that the organization reduces, reuses, and recycles; acts in a socially responsible manner; implements effective internal controls; and minimizes supply risks and the opportunity for disruption.