This week’s webinar notes are actually on an event from a couple of weeks ago: “An Introduction to Supply Chain Response Management – driving supply chain performance through responsiveness to unexpected events release” presented by Kinaxis. I missed it that week, but really wanted to go. Now that I’ve gotten to hear it, I can share my notes with you.
The event was originally run on August 3rd, but unfortunately for them, they experienced some technical difficulties with their service provider. The silver lining is that they will be rerunning the event in September with a “more reliable new solution provider” according to their post-event email. So if you have any interest after reading my notes, you can either click here to listen to an archive of the event or watch for news of the September session. I’m sure we’ll list it in our events calendar.
One of the things I appreciate about this event is that they bill it right up front as an introduction. There are so many things for us to learn/know about that it is hard to imagine pulling together a large, unknown group of people for an advanced coverage of a topic. Covering an already complex topic (supply chain response management) as an introduction means that nothing is implied, and so hopefully nothing is missed.
The other thing I liked about the event was that it was more about the discussion between moderator and panelists than the slides. Sure, there were some good shots of emergency response vehicles (and I've included once here so you get the full effect, because who doesn't love a good shot of a fire truck?) but for the most part I could just listen. Some times these webinars have so much content - written and heard - that there is no room left in my brain to think critically or take notes.
Response management is the combination of process and technology that allow a company to respond quickly and profitably to unanticipated events in the supply chain – or as one of the speakers put it, to “detect and correct”.
Volatility drivers: demand changes due to forecast changes, regulatory issues, supply disruptions (ranging from POs simply being late to full scale natural disasters), pirates/cargo theft
Reactivity itself is less the problem than the timeline of the reactivity; minimizing elapsed time is the key objective. Several time sinks were identified, and they are all realistic enough that it is easy to see how even the nimblest of corporations would lose time after a disruption:
Ultimately, your best option is to address response management planning closer to the actual execution timeframe so they address real supply and demand. Market anticipation.
Large organizations face their own set of challenges with regard to response management, not the least of which is their own functional silos. In addition to external factors, they need to know how one problem affects others in the organization. And supply data often exists in more than one location.
Supply chain innovator best practices: step one is to recognize that you have a problem with your response management. Step two is to realize that that the tools you have in place are not up to the task. You need maximum flexibility and speed to handle real demand rather than forecasted demand. And finally, you need to be able to start quantifying the delta between real and forcast.
Using the recent example of the tsunami in Japan, a good response would have consisted of the following reaction: Assume that you will be facing worst case scenario while the full reality is still unknown. Locate alternate sources and determine how much supply will be available when and at what cost? What are the full consequences of the situation at hand? The impact only matters if it affects customer orders being processed, and only ‘important’ orders at that. Despite the fact that all customer orders are important, in times of distress, they can be prioritized. Get participation from the people affected by the disruption (customers).
How can we attain this visibility into our first and second tier suppliers using technology? Getting all of the data in one place – contract management, ERP system - is key, but you need a solution that also has the analytics required to support scenario exploration. The ability to run scenarios anywhere, anytime to look at the results will help you be better prepared and identify who you need to go to for information in order to avoid further delays.
Any technology is only as good as the process and team that leverage it. The people involved need to be able to deal with ambiguity. The technology needs to accurately represent the consequences of the decisions made in a response situation and minimize ambiguity as much as possible. The goal is to balance human intelligence and judgment.