Daniel Burrus says, “Disrupted or disrupter: you do have a choice.”
The world is moving very fast.
You may have noticed.
Supply chains have to move fast to keep up. Supply chain executives and managers must be able to make fast, effective, and accurate decisions—and they typically must be able to hundreds of such decisions every business day.
But, when SKU-level forecast errors exceed 50 percent of forecast volume on half or more of the items in your portfolio, how can you be expected to make accurate or effective decisions about product movement and replenishment?
It seems to be an impossible task.
You will never change the way you work until you change the way you think
Most supply chain executives and managers today are finding themselves under tremendous financial pressure. The financial reports are clearly indicating that their enterprises have too much working capital tied up in inventory, and operating expenses are impossible to control.
Worse! Much of the money tied up in inventories is tied up in inventories they don’t need! They’ve got too much of the wrong stuff!
At the same time, they are finding they must over-staff their supply chain with people who are pretty much dedicated to firefighting and expediting. Plus, they frequently have to pay for overtime in various operations just to keep their heads above water.
So far, the C-suite and supply chain leaders in the firms have done the safe thing. They’re doing the same things everyone else is doing.
They’re trying to tweak their MRP, MRP II and APS systems.
They’re investing the big bucks in “big data” and software that’s supposed to improve forecast accuracy.
They’re even considering upgrading their ERP systems, or adding new specialty supply chain management solutions promising improvements.
But, they are beginning to see that five, ten, even 20 years of investments in such “improvements” haven’t really moved the needle in terms of producing ROI (return on investment), or long-term competitive advantages.
They are certainly seeing that all this spending hasn’t made them a disrupter. And, more and more, they may be finding themselves disrupted by unexpected changes in their industry or markets.
It’s beginning, perhaps, to dawn on them that doing the same things is never going to produce different results!
It’s time to install new thoughtware*
It’s time to face the reality that only a new way of thinking will ever move your company and your supply chain from the disrupted quadrant into the disrupters quadrant of your industry. Anything else just leaves you as an “also-ran.”
The Demand Driven Institute (DDI) has been on the forefront of making new thoughtware available for supply chain executives and managers. Their promulgation of demand-driven methodologies, their educational resources, their certification of compliant solutions, their case studies, and their other efforts have dramatically increased awareness of power and effectiveness of becoming demand-driven.
NOTE: Becoming demand-driven doesn’t mean you’ll never use a forecast again. But, it does mean that you will de-risk your operational execution from forecast error. (It is beyond the scope of this article to explain how. Go to the DDI website to learn more.)
Isn’t it time for you to install new thoughtware in your supply chain? Become a disrupter. It’s your choice. We can help.
We would be delighted to hear from you. Please leave your comments below, or feel free to contact us directly, if that is your preference.
* New thoughtware is a concept and term first promoted by The Thoughtware People.