Succeeding in the New Normal and Beyond: How to Achieve Ongoing Supply Chain Success

The first three parts of this series have taken us through a journey of:

• Black swans driven by VUCA creating chaos and a new awareness of the challenges of today’s supply chains
• The four supply chain innovations of scenario planning, optionality, automation and many-to-many, real-time networks
• Supply chain executives stepping up to the board and executive committee level by understanding the focus on PRDT (performance, risk, digital and talent)

These three parts then lay the foundation for this fourth and final part of the series on how to ensure ongoing supply chain success and contribute to the profitable growth of your company.

Prior to 2020, the discussion around supply chain at the board level, and for many organizations at the executive committee level, took place on an annual basis during the budget approval process. This changed in March 2020 when we first heard the words COVID-19, coronavirus and pandemic, which gave new meaning to the words lockdown, social distancing and masked. In March, the executive committee asked about supply and demand, inventories and supply chain visibility. There were many, many Zoom calls as the executive committee learned more about supply chain and tried to communicate status to the board. Everyone was surprised to learn how out of control the supply chain had become, so quickly. The words that best describe the supply chain in March, April and May 2020 were confusion, chaos, disbelief and panic. By summer 2020, the executive committee became very familiar with the leaders in supply chain, procurement, inventory and transportation, and the board got to know the leaders of supply chain and transportation. The only discussion of budgets had to do with using the budget to represent the norm and see how far from the norm we were operating. The summer was also a period of enhanced understanding for both the board and the executive committee of the importance of the supply chain to the company’s success and the lack of supply chain resilience. The period between summer 2020 and now has been challenging but the lessons learned about supply chain have positioned it in a whole new light. Supply chain has a seat at the table for executive committees and is also gaining seats at the board table. There is a new cadence to the supply chain role in the company and supply chain executives need to adopt a new continual process of planning, managing and reporting on the supply chain. This new cadence is required not only because of the boards’ and executive committees’ new understanding of the importance of supply chain but also due to the volatility, uncertainty, complexity and ambiguity (VUCA) of the supply chain. To address this new cadence, supply chain executives need to abandon the concept of an annual budget process review of supply chain and instead adopt a new process of continual supply chain leadership (CSCL).

This new CSCL is not about reviewing your supply chain’s performance and projects more frequently, but rather about continually reviewing your short-, middle- and long-term priorities given the realities your supply chain is facing. The short-term supply chain priorities are about execution and the day-to-day performance of your supply chain. The middle-term supply chain priorities are about monthly recognition, documentation and management of problems, changes in requirements and risks. The middle term is where the seeds of innovation are planted to be grown and harvested in the long term. The long-term priorities are not unlike the prior annual budget process, except it is a rolling 12-month process that is upgraded each month by removing the previously completed month and adding the month that is 11 months away. The short term is about things to do today, the middle term is about adjusting priorities based on current events and the long term is about preparing your supply chain for the future. The long term is where the scenario planning, optionality, automation and many-to-many, real-time networks that were described in part two of this series are put in place and allow you to perform with excellence in the short term. The middle term is where—based on the performance, risks, digital and talent (PRDT) from part three of this series—you adjust and add to the long-term priorities. The short term is where you reap the rewards of the overall CSCL process. It is this CSCL process that is the basis of the supply chain executives briefing the executive committee and the board on a monthly and quarterly basis, respectively.

This four-part series has presented the four steps of awareness, preparedness, stepping up and ongoing success that will elevate the status of all supply chain executives who partake. All four of these steps are different than they were in 2020. It is an exciting time to be in the supply chain profession, and I wish you well on your journey.