As of mid-2018, approximately 60 percent of Amazon’s US customers were members of the company’s Prime premium delivery service. Those 95 million consumers are worth a lot to the e-commerce giant; on average, they spend $1,400 a year with the company, compared to the $600 spent by non-members. In return, they expect exceptionally high service levels: a key benefit of Prime membership is two-day delivery lead times at no additional cost.
Where Amazon has led, the rest of the industry is following rapidly. Walmart is developing a network of dedicated e-commerce distribution centers designed to allow next-day delivery of online orders to 90 percent of the US population.
In a recent McKinsey survey on the challenges for Supply Chains, less than half of the responding executives stated their companies were prepared for the three biggest challenges: global competition, rising consumer expectations and complex patterns of customer demand.
The Supply Chain produces most of the tangible elements of value to the customers:
- Availability, how easy it is for the consumer and customer to get the product and the services is determined by the efficiency of the company planning, logistics and distribution systems.
- Quality and performance of the products and services are determined by the performance of planning, purchasing, production, distribution, technology and quality assurance
- Price is considerably influenced by how well all the actors in the supply chain leverage the whole system
- Innovation involves suppliers more and more, so supplier selection and management is becoming increasingly important also from this perspective
What are the pillars of a successful Supply Chain? I have identified 4.
Pillar 1: High awareness by all departments and their leaders of the value and importance of being interconnected and driven by a common purpose and explicitly shared values and behaviours.
Pillar 2: A transparent customer-supplier relationship between the departments of the chain and their leaders, with clear service level agreements and cost targets.
Pillar 3: Always strive for continuous improvement, looking inside and outside, with creativity and openness.
Pillar 4: Quality and Reputation of your people: they need to have state of the art knowledge and specific skills as well as future looking so that they can deliver results for present and future customers.
So what are the characteristics of an Innovative and Agile leader in the Supply Chain (Purchasing Managers, Factory Managers, Warehouse Managers, Logistic Managers, Distribution Managers, IT Managers) ?
In my experience there are 10 key macroareas:
- Developing international teamwork with your Supply Chain peers, internal and external
- Developing and Maintaining operational vs strategic balance
- Staying close to the operations & to your people
- Growing people, pulling out solutions from your talents
- Create a culture of giving and receiving feedback and learning from mistakes
- Leaving a sustainable legacy : leaving your Supply Chain in better shape that you found it- in safe hands for the future
- Assessing the resilience of your supply chain, analyse capabilities and vulnerabilities
- Developing the ability to influence all the key stakeholders that impact your input and output
- Learning to manage yourself as a leader in stressful and time-short contexts
- Encouraging collective innovation
Does your current Company Leadership Development program hit all of these?
The Supply Chain is unique in a company and flourishes best when tools are tailored for its exact job. Company-wide leadership programs are often designed to be general enough to be relevant across the entire company or have a Marketing and Sales focus.
How would you rate your Supply Chain leaders against the 10 macroareas above ?
We have a self-assessment tool developed for this purpose which will allow you to define individual and collective leadership development journeys to make your Supply Chain more competitive – delivering future value to your customer and consumers.
In my experience these journeys should have the following characteristics:
- Coaching and training: practice in a safe but challenging and creative environment, thanks to coaches with Supply Chain experience
- Microlearning: short sessions over a period of time, with coaching support for implementation of learnings
- Peer to Peer learning, in person and virtual, via a mobile friendly Virtual Learning Platform
- Measure progress, via self-assessment, stakeholder interviews and pulse surveys
- A journey with a clear structure and excellent and timely communication with the sponsor
This journey would typically take 8 to 10 months with about 6 face to face 1-day team touchpoints and about 3 individual virtual coaching sessions.
It’s a challenging journey for the participants, that require the courage to be ready to be open, vulnerable, practice, learn and share.
Are you ready to ride ?