Consider the picture on the left, what a beautiful air show display giving a sense of national pride on what looks to be a beautiful day. 8 planes being piloted into an airborne display of perfection!
As a Supply Chain leader making observations about this image, I can't help but ask a few questions:
- How fast are the planes going?
- What is the distance between each plane?
- How often are the pilots adapting their speed, trajectory, etc. to make sure they're balanced?
- What is the trigger to make a turn? How do they coordinate to stay in formation?
- Out of the total population of pilots nationwide, what percentage are capable of executing such a formation?
- Who choreographed this show?
- Who evaluates air shows nationwide as well as individual pilots to evaluate capability to pull off such a well-choreographed show?
Do you see any correlation to leadership in a Supply Chain? Every link in the Supply Chain is interconnected. Separately you have Distribution, Transport, Scheduling, Execution, Forecasting, Customer Services, Supply, Inventory, Production/Purchasing, etc. Each has it's own set of KPIs similar to the image. Production runs at a certain speed. Forecasting has a certain accuracy target. Distribution has door turns and utilization. Scheduling and Buying have to execute inventory requirements. Raw material availability at the time of production has to be monitored.
Most companies are effective here, however some still have opportunities. But what about measuring the synergies?
Do you measure your most erratic or volatile items so your forecasting team can partner with your customers/customer services on improvements? Do you correlate your scheduling adherence issues to other operational performance KPIs so you're truly getting to the root of the issues and improving future plans? Do you measure inventory availability at the time of picking so your inventory planning parties can set up DCs for door turn success, leading to on time success?
The most successful companies have individual KPIs and take it a step further to monitor the balance between cross functional parties. The choreographed air show is a perfect example, the best case is an ugly display if the distance, speeds, pilot capability, etc. are not consistent. The worst case is the planes are crashing into one another in the air.
Measure the individual planes, but also measure the connections between each for a well orchestrated show. Same goes for a well run Supply Chain, the individuals AND the synergies must be monitored, measured, and managed.