basictraining
BY ART VAN BODEGRAVEN AND
KENNETH B. ACKERMAN
Everybody get on the bus
SO WHAT IF YOUR SUPPLY CHAIN ORGANIZATION DOESn’t include everything that some others do? Is that such a big
deal? Haven’t your intrepid authors often said that the supply
chain organizational structure is a flexible concept, dependent
on many variables?
Guilty as charged, with an explanation. When it comes to traditional lines and boxes on an org chart, much does depend on
culture, global footprint, divisional P&L accountability, and
other non-trivial factors. When it comes to functional inclusion,
that’s a different story—particularly as our vision of scope, scale,
and inclusion in the supply chain continues to evolve.
THOSE WHO CANNOT REMEMBER HISTORY …
Back in the day (when so many of our respected pioneers started), traffic management and transportation
were everything. Warehousing (in today’s
parlance, distribution) was something different, involving somnolent managers and associates with strong backs and weak minds. If
traffic managers were nobility, purchasing
agents were princes, neither to be trifled with
nor disrespected in any way. They received far
more swag at holiday time than anyone in the
evolving logistics universe.
Logistics elevated traffic and transportation into a comprehensive view of how boxes
would get from Point A to Point B, and the
burgeoning field deigned to encompass storage (warehousing) and some level of filling
orders as part of the new world order. Meanwhile, the purchasing
agents were evolving from Four Roses to Jack Daniel’s as a minimum expectation.
The emerging supply chain point of view began to integrate
the independent functions we had traditionally dealt with, and
introduced disciplines and internal relationships that developed holistic plans and collaborative accountabilities for continually improving execution in storage, movement, and customer satisfaction.
what? Wherever the goofy notion was seriously
tested, it worked.
The really aggressive pioneers began to
insert, include, and integrate purchasing functions into the end-to-end supply chain. That
was an enlightened first step. But there were
complications.
While all this was going on, and actually earlier, the buyers and purchasing agents had been
elevating their game. They had seen the strategic implications of changing models. The idea
that the “finding” of materials and sources, and
of building relationships with suppliers was
even more important than the “getting” of
goods at whatever price a
supplier was grudgingly
willing to sell for, gained
traction. The profession
became significantly more
professional.
But, regrettably, they also
began to see themselves as
the drivers of the supply
chain, value chain, demand
chain—whatever you want
to call it—bus. Their world
view had the supply chain
beginning with them. They
offered certification and
spoke of supply management.
In our view, sourcing and procurement are
vital—and integrated—components of a real
supply chain, and the chain begins with customers and demand. And we see no benefit to
having procurement as another oar in the water
that needs independent communications and
collaboration, when it ought to be part and parcel of one corporate entity that already speaks
with one voice.
This thinking was mysterious in days of old.
But a few brave souls tried to put procurement
and the supply chain together, too often by making supply chain functions report to the procurement vice president. This move baffled
THE REBELS
So far, so good. But a handful of freaks wanted to go further.
They, correctly as it turned out, thought that manufacturing
ought to learn how to dance to the same beat as everyone else
involved in the process of getting goods to customers. Guess
