Where did our metrics come from?

Are they still useful today?

Reviewing information on data and metric use, one finds that WWII initiated much of the foundation supply chain and operational professionals now use. While the methodology and metrics have been modified for business, the underlying issues are the same.

Below you’ll find that the more things change, the more they stay the same.

While the problems don’t really change, the strategy required has.

Here are a few WWII questions followed by WWII operations research insights. Are any of these questions still being asked in your organization?

Please note: the U.S. Navy document holding the below content is an uncorrected text file and therefor has misspellings (no autocorrect on typewriters) and other document format errors.. Click here for the document

?How efficient are we?

• “…ratio of output to input f°r given operation…”

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How do we maximize the use of limited systems to our benefit?

• “A small group of scientists were the first to practice operational research. Their job was to make maximum use of the small amount of radar equipment available.”

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Can data captured in one location be used in a different location to improve results? (This answer assumes operations use the same processes and training. IE: standardization.)

• “…a consistency was seen in certain operations which permitted the application of data from one geographic location to the problem of predicting effectiveness in another area.”

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What is the correct ratio of training to operational work per person for maximum effect?

• “The problem of training and operational distribution was also studied by OR men. Squadrons of B-29s in the Marianas were able to fly a fairly constant number of hours per month. This time had to be distributed between training and operational missions, since low “scores” were made when no time was allowed for training. The original distribution was approximately 4 per cent for training and 96 per cent for missions. However, analyses showed that maximum effectiveness occurred when 10 per cent of the time was used for training and 90 per cent for missions.”
• Note: I find this entry very interesting since the trade-off between training and work used today is shown in this response not to be a trade-off at all. It is instead an optimization exercise.

Your metric and operational data may very well be based in WWII methodology.

Everything still works, right?

We are still using the tools so they must be good, right?

Well…

If you already have metrics and data that capture how you are doing as an organization, why do you have so many recurring problems?

To help with the solution, remember, times have changed. Here are a few of the changes you are probably experiencing in your supply chains:

• Supply chains are much more complex.
• Labor works differently.
• Tech is more prevalent in all areas, has many more uses, and is rapidly changing.
• Skills sets needed are different and rapidly changing.
• Different types and styles of training are required.
• Lead times, especially order to OTIF delivery and the lead time for information delivery, have shrunk to times that were previously part of science fiction stories.
• Customers around the globe have a voice in how your organizations serve them.
• Geopolitics is an ever-changing factor that must be integrated into Planning, no matter how big or small your organization.
• Data must be integrated, visible, and readily available in usable format in real time.
• Community, planet sustainability, equality, and resilience have entered your supply chain metric requirements. However, there is little understanding of how these concepts are measured, what the measurements provide strategically, and how each fits into your strategic planning – including what risks are eliminated and which are brought forth.
• SM has made organizational actions and their results more visible.
• “We estimate that ten years ago, CEOs and top teams typically focused on four or five critical issues at any one point in time; today, the number is double that,” source: McKinsey

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What I consistently hear is that inside organizations, the organization’s strategic concepts are not understood in the way the executive team intends for them to be understood.

This can be corrected by using a consistent performance language throughout your organization to quickly and correctly convey strategic concepts into the tactical and operational areas.

Plus, with new disclosure requirements and regulations coming in from different countries and regions, strategic alignment and effective communication are more important than ever.

However, you are still basically using WWII concepts of operations and what to measure.

Organizations continue to have an overload of data, yet nothing on the problems at hand. At least, nothing of use. Or nothing locatable that is useful. Or nothing that aligns with metrics bearing the same name elsewhere in the supply chains for comparison’s sake.

Something is missing.

That missing something is preventing your needed strategic alignment and communication. No strategic alignment and communications equate to lack of competitive results.

Here’s what you need to know…

Today’s supply chain activity should be captured with more than just reporting in mind.

Success is about having metrics that mold and diagnose, in real time, what exactly is going on inside your End2End supply chains. That data needs to be instantly accessible and usable.

WWII metrics were not built to do this. They were built to report.

An excellent strategic framework for supply chains allows you to pick and choose metrics you need to align to strategic plans, customer expectations, and regulatory requirements all at the same time.

You can check year-over-year performance on the entities listed above knowing you are using an apples-to-apples comparison (the same metrics in different locations still mean and are measured in the same ways).

Even if operational or tactical changes are made, your metrics measure outcomes.

And outcomes are what supply chains deliver.

While WWII work set the foundation, today’s complex operations, tactics, strategies, and supply chains require advanced metric structures that capture what is going on where for rapid realignment.

Correct, rapid realignment that enables disclosure is a governance aspect. An aspect that can be verified, proven, and reported while also molding and diagnosing new performance correctly.

You can readjust to the now correct supply chain global segment, process, skill set, embedded practice as events unfold and data provides insight that change is required.

You are able to handle risk because your supply chain governance structure, the structure that you built using a solid framework of processes, skills, performance, practices, and tech for competitive advantage, allows it to happen.

And that competitive advantage and capability is built on work our armed forces enabled. Operations management started with their metrics and methodologies to provide insight and improve performance way before computers and AI. That foundation stands strong. It’s the structure that has evolved.

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Cynthia Kalina-Kaminsky is the CEO of Process & Strategy Solutions and is hosting a FREE Workshop to assist with organizing supply chain strategically and aligning tactically. To learn more, go to EssentialSupplyChains.com??? You can also learn the secrets of building performance metrics by clicking here

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