This is a series on Supply Chain Basics looking at the discipline from the Society of Operations Management perspective. Supply chain is also essential to project management as PMs are typically trained in world class contracting. For example, my Masters program had several courses involving contracting and the Defense Acquisition Workforce Improvement Act, DAWIA, certification highlights the combination of project management and supply chain. In this post, we will explore Implementation and change management methods adding some additional support as well.
Implementation and Change Management
At this point the supply chain processes have been identified and the improvements are associated with the benchmarks or objectives to achieve the improvements. Comment: This dovetails into the leadership model presented in the leadership series specifically as the first two steps. This posting adds to the Change Management step entering the implementation process and also includes additional leadership elements in the process. I will highlight the model as we move through the APICS approach which tends to skip around the model.
1. Choose KPIs and Establish the Baseline
The Key performance indicators, KPIs, are associated with the benchmarks. APICS uses the balanced score card and sets a baseline for each indicator which are kept to a manageable number. Please recall that the scorecard is designed around four areas; the customer, financials, growth, and learning. Growth and learning are the foundations to supply chain management. The customer is why the supply chain exists which is why improvements are necessary. The big challenge is to monitor the chain for performance and possible out of limits situations.
Comment: Score cards and KPIs are the same activity as Effects Based Outcomes, EBO, for most intents and purposes. EBO is more expansive than four categories, is more intense, and the jargon is slightly different. Both operate using qualitative and quantitative measures. KPIs expand on the goal setting portion of the leadership model. In change management element of the model people will look to the goals and KPIs for direction and achievability making change management more transparent to all.
2. Develop a Master Plan and a Set of Project Plans
APICS speaks to two plan types; a master plan and project plans. The master plan pulls together the overarching effort into a concerted effort of multiple projects that strive towards the strategic goals and objectives. The project plans focus on a specific goal or objective and measured against the KPIs. A project can be of many genres; engineering, job shop or batch, continuous improvement, PMI styled projects, and AGILE. Each project genre has its unique method.
Comment: The WorkBreak Structure, WBS, or the Bill of Materials, BOM, is the centerpiece of any project depending on the genre. The WBS applies more to continuous improvement, AGILE, and PMI styled projects where as the BOM applies more to engineering, job shop, and batch style projects. The BOM and WBS both have parent-child relationships but are scheduled differently and are structured slightly different due to purpose. The BOM relates to assembly of a component where as the WBS relates to the activities towards to deliverable. They can be interchangeable in some cases. Nonetheless, the WBS combines the master plan in the first two or three levels with the individual project plan in the lower levels. The BOM usually delivers a single component or service. The plans are part of the leadership model in the organizational design phase.
3. Communication Plans and Measures to All Participants in the Process
Communication is the key element of any effort as change cannot occur without communicating the change. All parts affect other parts of a firm. if moving towards a Just In Time, JIT, model than all the suppliers need to be brought into the process and cooperate in order to squeeze out waste.
Comment: The leadership model requires high levels of communication in all the steps. However, the building constituencies step has the highest requirement for communication. Building constituencies requires buy off by key stake holders and principles in the supply chain project. Failure to engender support at this level results in project failure. The building of constituencies is incumbent and one of the primary duties of the project sponsor. The project manager usually picks up and runs with the project after the sponsors builds the necessary support. After all, it is the sponsors project and if he does not support it then there is no real project. It may flounder and slowly make progress under these conditions. Sponsor support means continual engagement and interest in the project.
4. Pilot projects
Pilot projects are necessary in many instances to learn about the challenges and problems ahead. Pilot projects also seek to achieve proof of success or that success is possible. This engenders confidence in the project.
5. Changement Management
Change, a common political mantra, has enormous disruptive implications across any system. Experienced professionals know that change is difficult and even impossible at times if no properly handled. Senior leadership must carefully plan change not only to a supply chain but any system. The more expansive the change the more disruptive the change becomes. Communication and groundwork before, during, and after are necessary. Transparency and confidence building are required. There are some organizational and personnel issues that must be addressed:
- Structural changes are part of the supply chain evolution and involve transitioning to a process-oriented structure. master and project plans will need to incorporate this strategy.
- Strong competent change management is not only required but critical to success. If industry leaders and supply chain partners are not part of the process then there is no process. Passionate advocates and full partners, constituencies, are necessary to move the change forward.
- Growth and learning are key the change. People cannot be introduced to something unmanaged and expected to swim. Training on skills, policies, and processes are necessary.
- Incentives should be reflected in the scorecard. Success must be focused on the customer and balanced with the business.
- Transparency and information sharing are pinnacle to partner communications. Information sharing must be diplomatically approached focused on what is best for the customer and smoother supply chain operations.
Comment: Much has been written on change and change management. The common theme is a connection to strategy, communications, and proper planning. This connect to strategy is almost always overlooked or poorly structured. Communications are also often amiss. If the other two are weak or amiss then proper planning follows suit. The best approach to change management is to hold workshops and involve everyone in the process. Dispersed ownership is the best solution to sweeping change.
Monitor Results and Make Adjustments
Continuous improvement projects come from both directions; bottom up and top down. Project must be compliant with strategies and strategies must be able to be effected. Proper management gives the driving force in order for change to be effective and credible. Implementation is effective working bottom up.
Comment: In my experience, one of the vast problems in industry today is the abandonment of management programs which is an underpinning of Operations Management. The programs provide structure, duties, and responsibilities for staff. They are loosely written as guidance and provide tools, practices, and methods for their respective areas. They are the baseline from which change occurs and stabilize an operation. Having management programs also makes measurement and monitoring much more simple as the operational accounting is emplaced feeding the reports to management. Without management programs, the workplace becomes a wild West and pot shots in the dark.
Reference:
(2011). APICS Certified Supply Chain Professional Learning System. (2011 ed.). Version 2.2.
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