Key Point: Arm your supply chain planners with the right software tools so they can do their jobs better; make decisions about your supply chain instead of spending time collecting data and building Excel models.

There is a parable about a group of blind men encountering an elephant for the very first time. Being unable to see, all of them tried to make sense of the object by touching it. All of them came to different conclusions based on the body part they touched. The person who touched one of the legs thought the elephant was the stump of a tree, whereas the person who touched the tail thought of the elephant as a rope. All of them went on to describe the elephant as a snake (trunk), a mouse, a wall (side), a fan (ear), a tree stump (leg), a rope (tail), and a spear (tusk). A teacher explained that none of them were completely wrong and no one was completely right either. While each of them was perceiving the elephant correctly from their point of reference, there was a bigger and different reality that evaded them.

Elephant Parable

Today’s supply chain can very often have a blinding effect on supply chain professionals. While all participants can appreciate their particular view, often the views are incomplete and contradictory to what others are seeing. As a result, at least partially incorrect judgments are often made. Either that or the supply chain teams spend all their time collecting the data so they can get a grip on the true situation. In many ways, it can be argued that the supply chain data is a behemoth (the elephant) and all the different participants in the supply chains have very limited points of view as the men in the parable.

One way this situation can be made better is by providing a quick change of perspective, the vantage point, if you will, which, allows a user to gain an understanding of the full picture, by allowing a person to see it from many different angles. Take the case of the Nazca lines in Peru. While people had known about them for a long time, the understanding was limited to curious trenches dug in the ground for no real rhyme or reason. It took a flight over the area to see the full picture and gain the understanding that the lines were actually drawn into figures of animals and birds and could have some other significance to the people who drew them. In this example, the airplane provided a perspective that was missing to the earlier observers. Absent the airplane (and the perspective it made available to us), we might still be thinking of these lines the same way we did in the early 20th century!

Modern supply chains are so loaded with data, they require technology to help interpret and drive decisions. The right technology will remove the impediments to the data and information-based decision-making process. It can help in various tasks such as:

  • Automating the collection of data
  • Changing the perspective via ‘slice and dice’ and aggregations and drill-downs
    • For example, a customer-focused perspective for the sales teams compared to a product-driven perspective for the marketing teams
  • Analyzing the data
  • Running the data through meaningful representative models so that the users can predict future behavior.

While great decisions are possible as a matter of chance in any situation (as the old cliché goes, even a broken clock is right twice a day), consistent good decision making within supply chains requires a combination of:

  1. Access to the data in meaningful ways from different perspectives
  2. Access to the collective experience and skill within the planning organization
  3. A structured process to make these decisions such as sales and operations planning
  4. Access to structured models so that various what-if questions can be asked and answered to some meaningful level of detail

The first and last item on the list typically requires access to software technology, whether homegrown or from the market. The absence of such technology places too much emphasis on the experiences (which can be selective) and the processes (which might be hijacked by different interests from time to time). More importantly, the supply chain professional spends too much time collecting the data rather than analyzing it and making decisions. They might also spend a lot of time creating and maintaining models in Excel to do the essential calculations. In this case, the planner’s role is reduced to data gatherers and programmers for the most part. Not enough time is spent on data analysis and decision-making.

Any business that spends time and money changing the roles of their planners to decision-makers (from data gatherers and programmers), gains from it many times over. Businesses that resist this investment do so at their own peril.

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