Call me cynical. Call me a pragmatist. Call me whatever you want. But, in this Internet-of-Things (IoT) age, where nearly everything that gets written and published is also hyped and promoted on key-words and catch-phrases, I’m having trouble with this one: “the bimodal supply chain.”FIG Incr Revenues vs Reduce Costs.jpg

 

Maybe it is not even the phrase itself. Maybe it is just Gartner’s Research VP Mike Burkett’s description of becoming “bimodal” that I am having trouble swallowing.

 

In an article by Jane Barrett posted here, Mr. Burkett describes “bimodal” this way:

In mode one Supply Chain must continue to focus on efficiency and operational excellence – the traditional operational caretaker. In mode two, in parallel, you must be able to experiment, fail (fast), innovate and embrace new crazy ideas. This needs different people, incentives and culture. You must hire data scientists and sociologists, experiment with drones and other smart machines, harness unstructured data and design e2e connected processes like never before. Analytics must become embedded and mainstream.

 

How does this work?

We come to work as consultants for companies on a regular basis where the companies, despite their best efforts, find themselves divided. Call it “bimodal,” if you want. But, it is really a form of double-mindedness—schizophrenia—that results in wasted time, energy and money as management oscillates from one pole to the other.

 

Here are some examples of the oscillations—double-mindedness—we commonly encounter:

  • Should we run larger batches to reduce costs? Or, should we run smaller batches to improve flow?
  • Should we service our equipment only when required to keep efficiencies up and costs down? Or, should we invest in preventive maintenance so that we don’t have unanticipated disruptions to flow?
  • Should we buy in volume to achieve the lowest costs? Or, should we buy in the quantities required to achieve flow and conserve cash?
  • Should we hold prices to achieve greater margins? Or, should we reduce prices to increase sales and total revenues?
  • Should we build to stock? Or, should we build to order?
  • Should we produce only on the optimal resources to keep production costs down? Or, should we produce on any available resource to maintain flow?
  • Should we ship complete orders only to save on shipping costs? Or, should we ship partial orders to maintain flow?
  • Should we allow overtime to maintain flow? Or, should we severely restrict overtime to keep costs down?

 

From Burkett’s description of “bimodal,” it seems to me you are asking “the system” (read: the company, or the supply chain) to hold in their minds two distinct goals.

 

On the one hand, Burkett wants the “mode one” folks to focus on costs and efficiencies—“saving” the company as much money as possible. Meanwhile, in the other wing of the building, or in an office somewhere else, there is a “mode two” team burning hundred-dollar bills in “fast failure” and “experimentation” that have no assurance of benefiting the company (or supply chain).

 

How long can this go on before jealousies and rivalries break out into the open—or worse, remain covert but equally damaging—between the “mode one” folks and the “mode two” folks? The “mode one” folks angry that they are constantly pressured to scrimp and save while the “mode two” folks contribute what may seem to be little or nothing for months, or even years, at a time. Meanwhile, the “mode two” folks become perturbed at the “mode one” team when they fail to produce the profits necessary to keep the “mode two” team functioning in the lifestyle to which they have become accustomed.

 

One goal and a unified approach to innovation and problem-solving

When we work with our clients and their supply chains, we work hard to help bring them a clear and unified view of their “system”—that is, their company and their supply chains.

 

Out of this unified view, we employ the Thinking Processes to help them choose and prioritize strategies and tactics that coordinate breakthrough innovation efforts and throughput increasing approaches that virtually assure improvements in ROI. We help them break the back of damaging management oscillation (read: double-mindedness) and set them on a path of ongoing improvement.

 

We don’t believe your supply chain needs to be “bimodal”—at least not as Burkett describes it—in order to have the best of both worlds: both flow and innovation.

 

(My apologies to Mr. Burkett and Gartner Group.)

 

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