Sustaining market through supply chain

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Sustaining market through supply chain

  1. 1. Sustaining Market Growth & Leadership Through Supply Chain Excellence Ramlee Ibrahim, Ph.D Direktur Utama PT Putra Primia Consulting
  2. 2. Business StrategyMichael Treacy & Fred Wiersema’s Discipline of Market Leaders • Operational Excellence • Product Leadership • Customer Intimacy
  3. 3. Supply Chain Strategy Is A Critical Dimension Of Business Strategy Business Operational Operations Strategy Strategy Executing To Win When & Why We’ll Win How We’ll Win Choosing where to Finding new and Organizing,compete, how to make effective managing, shareholder returns, ways to structure and executing to and on what basis to business create and deliver win over competitors operations and value to customers business and shareholders economics to achieve competitive advantage
  4. 4. Breakthroughs in Supply Chain StrategyCan Come From Several Sources … Big Winners Use Them All!
  5. 5. Growth - A Short Quiz1. Since 1995, which grew faster? Intel or inflation?2. After spending $100 billion on acquisitions were AT&T’s revenues (a) higher? (b) about the same? or (c) lower?3. In 1997 P&G CEO declared they’d double the business in 7 years. Based on actual growth rates, how many more years do they have to go? 2 years, 12 years or 25 years?4. IBM has grown service revenues at double digit rates. True or False?
  6. 6. Could My Business Grow At Double-Digit Rates?Most companies only see barriers to growth • We couldn’t afford the cash costs for that kind of growth
  7. 7. SCOR IndexThis chart tracks the value of an aggregate 70 company SCC members from 2003 on
  8. 8. The Five Core Principles Customer Requirements1 View Your 2 Supply Chain Develop end- As a to-end Strategic process Asset architecture External Supply Chain Internal Excellence3 Design Your 4 Organization Develop the for Right Performance Collaborative Model 5 Use Metrics to Drive Business Success
  9. 9. Supply Chain As a Strategic Asset Customer Service & Support StrategyTechnology &Product Sales & MarketingDevelopment Business StrategyStrategy Strategy Supply Chain Where you must be best  Where you can settle for Strategy being competitive IT & Business Infrastructure Strategy
  10. 10. The Basis of Competition
  11. 11. The Basis of Competition
  12. 12. Supply Chain As A Strategic Asset Example• Spanish clothing retailer, a division of Inditex• Present in 63 countries with a network of 997 stores• National borders are no impediment to sharing a single fashion culture”• A supply chain that defies conventional wisdom “A customer thinks, ‘this greenshirt fits me, and there is one onthe rack. If I dont buy it now, Ill lose my chance.’” Harvard Business School Working Knowledge, February 2005
  13. 13. How Zara Uses Its Supply Chain As A Strategic AssetMarket research Manufacturing On-going On-going 10- 15 days 10- 15 daysFeedback Distribution to Design creation storesFrom stores
  14. 14. The Five Core Principles Customer Requirements1 View Your 2 Supply Chain Develop end- As a to-end Strategic process Asset architecture External Supply Chain Internal Excellence3 Design Your 4 Organization Develop the for Right Performance Collaborative Model 5 Use Metrics to Drive Business Success
  15. 15. Develop An End-to End Process Architecture• Description of each supply chain process• Interaction between these and other core processes• Required applications• SCOR Model – http://www.supply-chain.org
  16. 16. Case Example - Amazon• “The earth’s biggest selection”• Millions of products• Delivered as efficiently as possible
  17. 17. Amazon’s Supply Chain Architecture Exact delivery Stocked by Amazon date BIC  Common, robust Distributors processes  Proactive shipment Estimated notification delivery  24/7 order date status BIC  Link to Partner companies carrier’s website BIC Items availablein millions
  18. 18. The Five Core Principles Customer Requirements1 View Your 2 Supply Chain Develop end- As a to-end Strategic process Asset architecture External Supply Chain Internal Excellence3 Design Your 4 Organization Develop the for Right Performance Collaborative Model 5 Use Metrics to Drive Business Success
  19. 19. Design Your Organization For Performance
  20. 20. Organizational Design Example • Identify imperatives • Quantify the benefits of an upgraded SC organization • Develop a roadmap • Redefine all core supply chain processes • Specify skills required • Initiate restructuring
  21. 21. The Five Core Principles Customer Requirements1 View Your 2 Supply Chain Develop end- As a to-end Strategic process Asset architecture External Supply Chain Internal Excellence3 Design Your 4 Organization Develop the for Right Performance Collaborative Model 5 Use Metrics to Drive Business Success
  22. 22. The Collaborative Spectrum Extensive Not Viable Collaboration Synchronized Collaboration Coordinated Collaboration Cooperative Collaboration TransactionalLimited Low Return CollaborationCollaboration Many Relationships Few Relationships
  23. 23. Collaboration Drivers• Master internal collaboration first• Segment partners• Ensure each partner has a stake in the outcome• Trust your partners (but have a contingency plan)• Set clear expectations• Use technology as required
  24. 24. The Five Core Principles Customer Requirements1 View Your 2 Supply Chain Develop end- As a to-end Strategic process Asset architecture External Supply Chain Internal Excellence3 Design Your 4 Organization Develop the for Right Performance Collaborative Model 5 Use Metrics to Drive Business Success
  25. 25. Use Metrics To Drive SuccessWhy use metrics?• To gauge the health of your supply chain• To drive desired behaviors
  26. 26. SCOR Metrics
  27. 27. SCOR Metrics & Benchmarking  Lets you choose your strategy Advantage Parity Superior  Prioritizes investments Where do improvements
  28. 28. Why Is Supply Chain Change So Tough ? Edgar, something is going on here? I haven’t seen It is management’s the Bear!!! responsibility to address the Bear in the room. Frequently we don’t want to do the tough things; we want a simple solution that doesn’t require a complete commitment. SCM won’t succeed without a complete commitment.
  29. 29. Thank You!!ramlee@putraprimus.com http:/putraprimus.com

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