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"Shell Lubricants has ripped up the rulebook in supply chain management, fully disrupting the industry" Shell

Supply Chain Planning and Faster Fire Engines

Jul 26th, 2019
by Ron Ezsak
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It seems that methods first conceived more than sixty years ago, further developed and refined some forty years ago, and transformed into application software during the last twenty-five years, has become for many the solution and the problem.

 

The problem is an inaccuracy. In what area of business would it be acceptable to be only sixty percent accurate the majority of the time? What would happen to a public company’s share price if the CFO announced they missed their revenue forecast by forty percent? Or perhaps that only seventy percent of the hazardous waste was disposed of properly. The consequences would be severe. Yet there is an area of many businesses where this is endemic, systematized, and surprisingly accepted as simply the way things are.  As virtually all in the space know, time-phased requirements planning is designed to consume a forecast. Among the sources of supply chain challenges, few create as many problems and cost than the maladaptive relationship that exists when an inaccurate forecast and due date collide.

 

It’s difficult to transition to fire prevention when so much effort, budget, and resource, is allocated to firefighting. Over time, processes, systems, and policies are established to suppress chaos and reign in cost. It becomes the way we do things, which has been the impetus for a great many vendors and consultants to interdict offering incremental improvement. They espouse the merit of proactively acquiring tissues as flu season nears but neglect to recommend a flu shot.

 

At the conference virtually, all vendors present offered capabilities designed to enhance the ability to identify and or respond faster to these common problems. No suggestion that it would be better to remove or abate the problem, nope. More granular analytics, enhanced visibility with minute by minute updates of goods in transit, and of course the mega-vendors who rely upon the great number of users to affirm their credibility. Millions of dollars invested and years of effort only to achieve incremental improvement, they’re in decline and for good reason. Their focus has shifted from what they have sold you, to what they have yet to sell you. Nearly all vendors present were offering faster fire engines, longer ladders, louder alarms, and bigger hoses. There are solutions, methods, and technology that can remedy a significant part of these challenges. But as business becomes more proactive and outcome driven the same old approach won’t cut it. Choosing to continue to fight fires but with faster fire engines echoes the common refrain, that’s the way we’ve always done it.

 

A thirty year veteran of both the manufacturing and software industries, Ron has developed significant acumen and expertise in both domains. Ron brings a substantial level of experience in virtually all aspects of production and inventory management, as well as the realities of opportunity and risk when employing software and technology solutions to address business requirements. Additionally, having helped companies improve their operating performance in one hundred and five countries, Ron’s international experience and knowledge of how business is conducted brings a valuable level of local and cross boarder awareness that delivers the desired outcome and enhances relationships.
People are Talking
Industry Buzz

Deep Diving into Demand-Driven Planning

"Shell Lubricants has ripped up the rulebook in supply chain management, fully disrupting the industry" Shell

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