The Point by Buyers Meeting Point
Book Review: The LIVING Supply Chain
“In the new global era, speed and velocity are more important than everything else!” (p. 12)
The LIVING Supply Chain: The Evolving Imperative of Operating in Real Time by Rob Handfield and Tom Linton (Wiley, 2017) takes everything you know about ecosystems and Darwinian principles and applies it to supply chain management.
One of the most telling sections in the book is in the Preface where Handfield shares three major shifts affecting the digital economy (paraphrased here by me):
- Data is a natural resource (think raw material)
- Converting data into decisions is the key refinement process of the digital era
- Cognitive computing (human/machine interaction) will be a critical ‘relationship’
To me, these points are significant because they are NOT followed by something along the lines of “… and here is what all this means for supply chain.” Like the authors, we need to stop thinking of the supply chain as somehow separate or downstream from economic/digital trends. The supply chain is a fully integrated piece of the ecosystem – or should be – and must be managed as such. Every time we feel compelled to translate trends, priorities, forces into a supply chain-centric version, we obscure their meaning and slow the movement of information.
Predators do not wait for changes in their food supply to be translated to explained to them before reacting. They adapt, relocate, or die out. Supply chains and their managers need to act with the same level of urgency every day and in the face of every decision.
The other significant point to note about LIVING Supply Chain is that it began as a case study/success story about Flex, a provider of innovative design, engineering, manufacturing, real-time supply chain insight and logistics services where Linton is the Chief Supply Chain Officer.
A perfect example of ‘survival of the fittest’ as applied to supply chain are the “cons” of speed, which are described in the book as (loss of) quality and increased risk. Since risk exists regardless, once supply chain managers make a reasonable effort to mitigate and plan for it, they can focus on controlling quality so that speed can be preserved without the loss of influence and trust.
The energy conveyed by the content and flow of the book is likely created by a combination of the authors’ enthusiasm for what is possible for supply chain leaders open to the opportunities of the digital era and the frequent use of examples from nature (wildebeest, the ‘grolar’ bear, and elephant seals to name a few).
As is true of the food chain, studying the supply chain as a living ecosystem reveals that it is vibrant, unpredictable, sometimes violent, and favors the bold. The last of the book’s 8 chapters is dedicated to the future of supply chains. The authors finish by identifying and discussing 6 major trends that will play a role in supply chain evolution from this point. They include increased autonomy, the risk of hacking, chain of custody, and real-time visibility.
For more from Handfield on the LIVING Supply Chain, read my notes from the BravoSolution Real World Procurement Series webinar earlier this year.