For us as consultants, we are continually faced with the question whether evolution of processes is better than revolution. Should we make continual small improvements, or would it be better to make big step improvements and radically change the processes.
The problem with revolutionary changes – is you cannot always predict the outcomes.
A typical example is a project – where we were recently involved – in the automation of warehouse operations. The theory (before the revolutionary changes) was that by automating they could improve response, increase capacity, improve accuracy, reduce labour, etc. The result (so far) has been the opposite – largely due to an inability to integrate the automation with the enterprise IT network.
On the other hand there have been fantastic examples of how successful revolutions in company approaches can be for the supply chain. Consider Shoprite – by far the most successful retailer in South Africa. They were the first FMCG retailer to fully revolutionise their supply chain – by taking a step decision to centralise their distribution network. This brave decision gave them a 10 year lead over their core competition and propelled them into another supply chain level stratosphere.
Vodacom took a brave decision 12 years ago to revolutionise their physical distribution network (build an automated centralised network) and the result has been nothing short of spectacular – their handset distribution infrastructure is still one of the best in the world!
So why are some revolutions in supply chains successful while others are flounder? Having been involved in hundreds of projects over the past 30 years – I believe the answer lies squarely in corporate culture. To accept revolutionary change you need:
· Strong leadership at the top who unequivocally supports the change
· Compliant IT departments – who focus on solving problems not on their own self interests
· Strong supply chain divisional management – that can drive the projects successfully
· Good partners who can provide the right quality infrastructures
· Intelligent consultants who have had previous experience (and whose advice is adhered to)
· HR infrastructures who can sell the revolution to the workers
· Steel backbones to support the revolution – even when things are going badly
· Financial support to spend money to effect a successful revolution
If you don’t have this culture – don’t aim for revolution. Small continual improvements are more your style. You may not come first, but you will keep your job and you can happily carry on with your existing supply chain forever (or until your opposition has a successful revolution & puts you out of business)
Contributed by the ever-controversial Martin Bailey, Managing Director, Industrial Logistics Systems
