Learning to WAITT

I'm going to vent a little now - (it's a perk that comes with having your very own blog).

Want a technique that will make things easier, faster, and more successful?  Consider this:

It's not a secret that the most important components in a project are the people involved. And yet so often the impediments to success are those very same people. 

When that happens 9 times out of 10 it's because there are personal agendas that hamper progress. They can be subtle or blatant. They can revolve around everything from poor self image to greed and opportunism.

All that can be said is that whatever the reason(s) answers are harder to come by and often sub-optimized.

The solution is to make it understood from the beginning by everyone involved:
we all have to WAITT (We're All In This Together)

It's a simple concept - we agree on the goal, we work together and (most importantly) we are willing to sacrifice egos and agendas to get to a successful conclusion. 

And finally you have to be able to ask yourself if you need to have someone involved that's not willing to WAITT.
       

Being Honest

Time to confess. In my life I have sometimes been both honest and dishonest. I've done it with family, friends, myself, and even God (He wasn't fooled). 

But I've learned - as a result of my experiences I now know that it's much better to be honest than dishonest. When I shine the light of truth (painful as it sometimes is) it's easier to move forward in life and to achieve the goals I actually want.

So why would anyone ever be dishonest?

Often it's simply a matter of convenience - if we choose to ignore or gloss over an inconvenient truth we can move on to the next step - whatever that is.

We sacrifice the solid foundation of truth in the false belief that we can achieve progress if we do.

So what does this have to do with supply chains?

Well, let me ask you this - are you honest with your ERP system? Your organization? Do you tell yourself the truth?

I have had people apologize to me before they share data with me - "These numbers aren't right but this is what we have."  What's up with that? 

Here are some questions for you:

• Are your lead time correct or are they "close"?
• How about your inventory accuracy? Do you really know what you have on the shelf?
• Are you using proper order history for forecasting? Do you adjust forecasts to skew inventory positions to your advantage?
• Are there any "fake" orders in your system?
• How accurate are your costs? Are you sure?

How about your organization? 

• Do you confuse training with a change in behavior? 
• Are you measuring the wrong things when you evaluate your supply chain? 
• Do you even know what you should be measuring? 

If you are not being honest with your ERP system you are building your house on sand - and it will catch up with you.

And if you are not being honest with your organization you will wind up expending a lot of effort for marginal results.

Sometimes bringing in a seasoned consultant - one with an outside view who is honest and is willing to speak up might be the best investment you'll ever make.

Do want real, positive change? Be honest.

 

 

True Perspective

 

The people who read this blog tend to be problem solvers - they look for something that's not right and they look for a solution to the problem.

So it's real easy for us to focus on the things that are wrong. And there's a lot going wrong these days.

Many of you are unemployed or underemployed. Family issues, health issues, financial issues all add to the mix. And it happens to all of us.

However, a requirement for true growth is to see things the way they really are. During this time of year we should be reminded of how things really are in our own lives - to provide ourselves with a true perspective.

In other words, count your blessings.

Did you make it through the past year?  55,000,000 didn't.

Planning to eat today?  1.02 billion people are hungry. Every day.

Reading this now?  785,000,000 people can't read or write.

So here's the point. Don't ignore the things you can improve on - but don't overlook what you have today. It's good for you.

I sincerely hope that next year is better for all of you, regardless of where you are and what you've been through.  And whether your glass is half empty or half full, be thankful you have a glass, and for the One who does the filling.

A Bureaucrat to the Bitter End

 I recently found this gem on the internet:

  Off of Rt. 122 near Bedford, VA you can find a most unusual cemetery. It's officially known as the Antioch Baptist Church Cemetery, but most  locals refer to it as the "ABC Cemetery," not because of its name, but because of its former owner and caretaker, Thomas Aadland. 

You see, Mr. Aadland had a habit of  re-ordering the graves to keep them in strict alphabetical order. 

Following an internment, local residents would find Aadland digging up graves and shuffling caskets and headstones from plot to plot to maintain the alphabetic burial sequence.

He even had all the plot owners to sign a form acknowledging the "floating" nature of their burial plot and allowing him to change the assigned plot and move each body as needed. 

As bizarre as it sounds, family members didn't mind - it allowed them to easily find the grave sites of their loved ones on return visits without having to remember the location between visits.

In 1992, Aadland found himself near death, and he realized that he would no longer be able to maintain the cemetery, much less continue to shuffle the grave sites. 

Because of this, he decided to close the cemetery, but to his horror, he realized that the graves would have to be shuffled one more time so that he himself could be buried in proper sequence (and an "A" shuffle to boot...the worst kind). 

Too weak to shuffle the graves once more, Aadland placed a newspaper ad seeking laborers, but he had no takers.

If you visit the ABC Cemetery today, you can observe firsthand how Aadland solved his dilemma. Look for the very last grave in the cemetery...the grave of Thomas Zuckerman... formerly known as Thomas Aadland.

There's got to be a moral here somewhere.

It's either:

• Don't let your procedures get in the way of your original objective

or

• Learn to think outside the box (casket?) 

Becoming One With The Customer

If you stop and think about it a supply chain operates for the customer; just about every other aspect within a supply chain is designed to maximize a specific response to customer demand. Often it is simply to maximize profit but it could also be to maximize service, loyalty, consumption or something else. Laying aside what the specific goal is for the moment it still should be obvious that the better view of customer demand you have the better the opportunity to achieve that goal.
So how do we get the best possible view of what the customer wants? Or to put it another way: How do we get the best forecast possible?
The logical place to start is to generate a statistical forecast of demand, modify it as appropriate, and use it to drive the supply chain.
The history to be used is the first thing to consider. Remember that you want to simulate the customer; what history do you have that best captures that?
Usually the best history to start with is orders booked by requested ship date. But even that data needs some work. Here are some things to consider:

• Does the order reflect the item(s) the customer truly wanted or what was negotiated with order processing? How about the date?
  
• Does the order reflect the preferred ship location or the actual ship location?
  
• Are returns to the order history handled correctly?
• Are abnormal orders filtered? How?

Unfortunately, very few companies have this totally figured out. Primarily because they don't have all the data they need - and sometimes they can't get over the hurdle of history used to forecast being different from pure order history. But the better the data going in the better the data coming out. That only makes sense.

Supply Chain Nutrition

Seems that just about this time each year my wife and I get into a routine to get into shape. She does it to maintain her youthful appearance - I do it so that young kids don't try and push me back into the water while I'm laying on the beach.

So a fair amount of time is spent exercising these days. I'm feeling better and it does seem to do some good. But there's another side to good health - the chocolate covered potato chips are going to have to go if I'm going to do it right. It's not just the exercise; nutrition plays a part in my health.

Something similar takes place within a supply chain. Lean initiatives, quality control procedures, and just in time policies and procedures can only take you so far. Without the correct nutrition (data and policies) you could find that you have efficiently acquired the wrong products in the wrong quantities. And the high quality of those products will be cold comfort to you as you watch the dust collect on them in the warehouse.

Healthy Data

Healthy data is necessary to have your supply chain operate efficiently. In order to be healthy, data must be:

• correct
• timely
• appropriate

Being correct is easy enough to see - just don't transpose characters in your item ID, if 20 were removed from the shelf make sure 20 was the number recorded, don't order cases when you really want units, that sort of thing. We've all heard "Garbage in, garbage out". It's true - and if you do it you wind up with the original garbage plus the garbage your supply chain generated to respond to it. So don't do it.

Timely is only slightly more philosophical. The inclination is to make everything real time - if something happens, capture it. Interestingly enough, this actually makes sense for most situations - lots of ERP companies have amassed a sizable fortune touting real time data capture before spending it all on bonuses, outings, and other perks for the elite within their ranks. (You know it's true.)

But the planning process is a little different. When you're planning (if you're doing it right) you're setting boundaries. What you expect customer demand to be (plus or minus some range). What your service and turns goals should be. What your minimum and maximum inventory position should be to achieve that balance. That sort of thing.

You don't want to re-plan your supply chain every time an event happens (note that this does NOT mean you don't want to respond to it.) The right thing to do is plan periodically - usually monthly or weekly. If you plan too often you run the very real risk of resetting goals every time the wind blows; if your planning is not often enough you run the risk of missing real changes. The right frequency is a function of the type of business you're in.

An aside. I once worked with a company that operated on 10 periods per year (You know who you are.) Here's the way it was explained to me: 10 is a NRN (nice round number). So let's have 10 periods per year. Nine 5 week periods and one 7 week period right in the middle. I want to meet the person that made that happen.

Now here comes the interesting one - appropriate data. Are you using it? Sure, you really did ship 152 units of that product last month - but do you want to use that to forecast customer demand?
And that vendor has a published lead time of 3 weeks - should you use that or should you use the actual measured lead time? This could take some time to explore. We'll start next time.