Is Software Really A prerequisite in running a supply chain – Part 2
This is part 2 of my blog on evaluating the role of software / IT systems in running a supply chain.
In the prior blog I had highlighted a few questions on what are the pre-requisites for enabling great supply chains and while software is indeed a key enabler, it is not sufficient alone to make a successful supply chain.
So, What role IT systems / software then play in managing supply chain operations?
My view is that Software and IT systems are enablers and hence not the end objectives of a supply chain operation. As described in my prior blog ,true pre-requisite for creating successful supply chain is to align the competitive priorities within each area of supply chain operation. IT systems / software can play great role in creating platform for this alignment. There are three major areas where this platform is needed: 1) capture, communication, collaboration and consensus on competitive priorities across all levels (definition & seamless flow down of priorities) 2) translation of these priorities into specific business rules, decision thresholds and 3) measurement & control of actual execution – workflows, exceptions, alerts and metrics to determine the effectiveness of the alignment.
Based on my own experience in managing as leading several supply chain systems implementation, most software / IT systems available today, focus on the later two while not paying enough attention to the first one. For example most packages today have functionalities and features to manage demand planning, supply planning and so on and have good mechanisms to provide alerts / exceptions and workflows. However, when it comes to the first part, these systems at best have some pre-determined generic metrics / dashboards – which may not fit all businesses and in most cases have nothing at all. This is left to the business teams and implementation consultants to figure out. This also leads to customizations (often heavy) to the IT systems which add complexities to the implementation and are difficult and costly to manage and maintain.
Further, despite these customizations, business stakeholders are often not satisfied and place requirements for more customizations and enhancement requests (increasing cost of IT services).Hence for IT systems to really add value to supply chain operations, it would be required to increase focus on creating mechanisms to help capture, communicate and build consensus on competitive priorities. While the success of this alignment still remains with the people, having these mechanisms in place will help in improving the effectiveness of underlying operational processes and also improving the effectiveness of IT systems.
Would be curious to see your perspectives /experience on this.
