Supply Chain Transformation: Practical Roadmap to Best Practice Results

Praise for Supply Chain Transformation

"This book offers a great training tool for those new to the supply chain and can help keep the rest of us centered and open to inviting change."
Patricia J. Daugherty, Donald J. Bowersox Chair in Logistics and Supply Chain Management, Michigan State University

"Rich Sherman provides an easy read, good for anyone who wants an entertaining, yet thorough understanding of the supply chain profession and its importance to global commerce."
Rick Blasgen, CEO, Council of Supply Chain Management Professionals, and former senior vice president, Supply Chain at ConAgra Foods and Kraft Foods

"From his unique vantage point, Rich Sherman takes us on a journey that leads to greater success with the objectives of supply chain transformation. . . . He has provided the profession with a highly understandable roadmap that can help to improve all of our supply chains, and individually as a supply chain leader."
C. John Langley, Penn State University, and CSCMP Distinguished Service Award Recipient

"Sherman has created one of the best how–to manuals for the professional intent on improving the performance of their supply chain. I know of nowhere else you can find information on the dynamics of change and the supply chain marketplace."
Ron Webb, Executive Director, Membership and Research Services, APQC

"In an informal conversational style, Rich Sherman leverages over twenty–five years of industry and consulting experience to present a humanistic, learning–oriented perspective for leveraging the supply chain that is both timely and informative."
Alex Ellinger, PhD, Frank Schultz Professor of Business Administration, The University of Alabama, and Editor, International Journal of Physical Distribution and Logistics Management

"Rich Sherman has used his vast experience in supply chain management to write a truly inspiring and thought–provoking book."
Dave Malenfant, Vice President, Global Supply Chain, Alcon, a Novartis company

"Richard Sherman has done an outstanding job using his expertise in supply chain management to offer supply chain management professionals a blueprint in developing a successful supply chain strategy for organizations."
Jack Crumbly, PhD, Assistant Professor, Andrew F. Brimmer College of Business and Information Science, Tuskegee University

Foreword xi

Preface xiii

Acknowledgments xvii

Chapter 1: Change Is Inevitable, Growth Is Optional 1

Globalization Changes the Game 3

Paradigms Drive Organizational Behavior and Culture 5

Assessing Your Company s Culture 7

Levels of Cultural Maturity 9

Building a Case for Change 14

Paradigms Can Encourage or Constrain Innovation 16

Notes 18

Chapter 2: Putting the Business in Perspective 19

Defining and Understanding Business Objectives 21

Defining the Business within the Context of the Market 24

Developing Your Vision 25

Adding SWOT Analysis Puts the Business in Perspective 29

Principle of Creative Tension 32

Notes 34

Chapter 3: Market Drivers and the Dynamics of Change 35

Supply Chain Is Marketing: A Tool for Analyzing the

Market Environment Impacting the Supply Chain 38

Scanning the Market Environment for Drivers of Change 40

Systems Thinking: Your Strategy for Managing in a Changing Market 43

Notes 52

Chapter 4: Business Structures Are the Levers of Change 53

You Can t Break Down the Silos: Collaboration Is the Key 54

Understanding the Business Structures and Processes That Govern the Behavior of the Organization 57

Vertical and Horizontal Business Structures and Drivers 58

Everything That Gets Done Gets Done through a Process . . . Business Process Management 60

Chapter 5: If You re Driven by Demand, You re Probably Being Driven Crazy 69

What Are the Demand Creation Structure Process Types? 73

Demand Creation Processes Impact Demand Fulfillment Behavior Dramatically 76

Guess What? The Forecast Is Wrong, Deal with It 79

Forecasting Is as Much about Art as It Is about Science 82

Event–Driven Forecasting Is a Best Practice Imperative 84

Extend Collaborative Processes to the Customer (and Supplier) 86

Note 89

Chapter 6: Supply Chain Management: A Pipeline of Opportunity 91

Understanding the Demand Fulfillment Structure 92

Major Operating Functions of the Demand Fulfillment Structure: Procurement, Production, and Logistics 94

Lean Six Sigma Is Not an Option It s a Requirement 99

Leveraging Supply Chain Capability for Synchronization: Strategy, Planning, and Execution 103

Notes 119

Chapter 7: Okay, We Need Management Commitment; So, How Do We Get It? 121

Understanding the Demand Performance Structure 122

You Can t Manage What You Can t Measure 125

Process Types That Drive the Demand Performance Structure 130

What Keeps the CEO and CFO Up at Night? 131

How Does Operations (Supply Chain) Excellence Impact the Income Statement and Balance Sheet to Drive Return on Invested Capital? 134

Notes 140

Chapter 8: Technology Drives the Waves of Change 141

Scanning the Horizon for Technology Developments 142

What Emerging Technologies Are Likely to Impact the Supply Chain? 143

How Does Technology Impact the Organization? 147

How Can Information Technology Enable Business Operations to Maximize Return? 149

Chapter 9: Making the Journey Happen 153

We Got Management Commitment, What Do We Do Now? 154

Developing an Operating Plan and Creating a Culture for Change 154

Benchmarking: Perception versus Reality 161

How Do We Eat the Elephant? Identifying Projects and Setting Priorities 162

Jump on the Bandwagon: Communicating the Game Plan and Building Operations Support 166

Note 167

Conclusion: Business As Usual Has Been Canceled, Now What? 169

References 175

About the Author 177

Index 179

RICHARD J. SHERMAN is an internationally recognized writer, researcher, and speaker on trends and issues in logistics, supply chain management, technology, marketing, and organizational change. He is currently serving as Director of Strategic Development for the Council of Supply Chain Management Professionals (CSCMP) and President of Gold & Domas Research, serving corporate members worldwide. As a research director, he successfully launched the supply chain management advisory services for AMR Research and was a leading member of the team that developed the SCOR model and founded the Supply Chain Council. He is a frequent contributor of articles related to logistics and supply chain management, and speaks at conferences, symposiums, and universities.