rethinking your

supply chain strategy

 rethinking your
supply chain strategy
A BRIEF GUIDE

roberto perez-franco


contents
 introduction

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Acknowledgements
 CHAPTER 1

the nature of the beast

B
The basic challenges

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Its complicated!

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Complexity: Objective vs. Subjective

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Prescriptions to tame complexity

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 CHAPTER 2

our approach to the problem

H
Type-based vs Specific

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Best practices vs Tailored practices

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External and Internal Wisdom

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Fundamental tasks

Task #1: Scoping

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Task #2: Visioning

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Task #3: Specification

Task #4: Articulation

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Task #5: Evaluation

Task #6: Generation

Task #7: Selection

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 CHAPTER 3

a framework for rethinking SCS

B
A definition of supply chain strategy

Strategizing in multiple dimensions

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Bridging the gap

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Adding granularity
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The conceptual elements

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The enabling elements

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The internal elements

The external elements

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The complete picture

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 CHAPTER 4

capturing your SCS

Categorization vs Articulation

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Mapping concepts 101

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Negotiate directly with

tier-2 suppliers on behalf
of tier-1 suppliers.

Aggregate volume of Leverage Dells

procurement orders buying power
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Aggregate volume of Leverage Dells

procurement orders buying power

Negotiate directly with

tier-2 suppliers on behalf
of tier-1 suppliers.
 RETHINKING YOUR SUPPLY CHAIN STRATEGY | 37

This Ensure continuity Reduce procurement

way to of supply costs further
Why?

Aggregate volume of Leverage Dells

procurement orders buying power

This
way to Negotiate directly with
How? tier-2 suppliers on behalf
of tier-1 suppliers.

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Vertical axis: the strategy-operations continuum

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Horizontal axis: the thematic range

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When mapping, hold judgment

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Nominal and Executed

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 CHAPTER 5

a protocol for capture

Step 1 - Scope

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Example

Step 2 - Conduct qualitative interviews

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Level 1 (7 individuals)

Executive VP of Strategic Sourcing

Senior VP of Marketing and Retail Sales
Senior VP of Operational Excellence
Senior VP of Customer Service
Senior VP of Strategy and Business Development
Executive VP of Operations and Supply Chain
Senior VP of National Chain Accounts

Level 2 (7 individuals)

VP of Operations - West Region

VP of Operations - East Region
VP of Operations - Central Region
VP of Specialty Sales
VP of Information Technology
VP of Strategic Planning and Execution
VP of Operational Excellence

Level 3 (8 individuals)

Director of Inventory Optimization

Director of Operations (x2)
Director of Retail Sales (x2)
Director of Consumer Products
Manager of Performance Cons.
Director of Marketing & Product Development
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Open Questions
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Semi-open questions
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Example

Step 3 Identify areas, policies and choices

Task 1: Identify tentative areas

Task 2: Identify policies and choices in each area

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Task 3: Confirm validity of policies and choices

Example
 RETHINKING YOUR SUPPLY CHAIN STRATEGY | 55

o
o
o

o
o
o

o
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o
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o
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Step 4 Identify objectives & build hierarchy

Task 1: Look for the objectives

Task 2: Prepare a hierarchical summary per area

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Example

o



o

Step 5 Build partial maps

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Example

Step 6 - Validate partial maps

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Example

Step 7 - Combine related partial maps

Example
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Step 8 Map nominal strategy

Example
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Step 9 - Assemble the FSM

Example

Step 10 - Validate FSM

First round: Individual feedback

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Second round: Collective feedback

Example
 CHAPTER 6

evaluation criteria

Rumelts Challenge

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Our Approach

Evaluation Criteria

Coverage
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Clarity

Feasibility

Internal Consistency
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External Consistency

Support
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Sufficiency

Parsimony
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Riskiness

Advantageousness

Actionability
 CHAPTER 7

applying the criteria

Coverage

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Examples
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Clarity

Examples
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Feasibility

Examples
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Internal Consistency

Compatibility
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Example
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B2 0%
B3 0% 27%
B4 0% 0% 0%
B5 27% 18% 18% 9%
B6 0% 0% 0% 0% 9%
B7 9% 0% 9% 0% 15% 38%
B8 0% 0% 0% 0% 9% 73% 38%
B9 0% 0% 0% 0% 23% 9% 0% 18%
B10 0% 0% 0% 0% 10% 18% 0% 0% 18%
B11 0% 0% 0% 0% 0% 0% 0% 18% 0% 8%
B12 8% 0% 0% 0% 9% 0% 0% 15% 0% 9% 0%
B1 B2 B3 B4 B5 B6 B7 B8 B9 B10 B11
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Coherence and Synergy

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Examples
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Support
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Example
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B1 B2 B3 B4 B5 B6 B7 B8
A1 50% 10% 70% 70% 60% 10% 50% 60%
A2 60% 50% 60% 20% 90% 20% 40% 50%
A3 90% 70% 80% 10% 89% 40% 70% 0%
A4 10% 0% 50% 10% 20% 0% 10% 30%
A5 40% 20% 60% 50% 50% 20% 30% 40%

B1 B2 B3 B4 B5 B6 B7 B8
A1 50% 60% 20% 30% 40% 80% 50% 40%
A2 40% 40% 30% 70% 10% 70% 60% 50%
A3 10% 10% 20% 30% 0% 60% 30% 70%
A4 70% 60% 50% 80% 60% 80% 90% 70%
A5 60% 50% 30% 50% 40% 50% 60% 50%
RETHINKING YOUR SUPPLY CHAIN STRATEGY | 89

Sufficiency

Example
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About the remaining criteria

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 CHAPTER 8

reformulating your SCS

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Progressive Formulation

Who is involved
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Required Inputs
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Steps
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From Specification to Elaboration

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A word on implementation
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 CHAPTER 9

reformulation examples

Example #1: Libica

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Example #2: Convenience Stop

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-
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o
o

o

o

o

o
o

o

o
o
o

o
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o
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o
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o
 CHAPTER 10

connecting the dots

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references

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index
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