Implementation%20Aspects%20of%20SCM

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Implementation Aspects of SCM

• September 27, 2003
• Shyam Bhaskar

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SCM Project Impact

• SCM implementation is one of the most difficult
  projects a company undertakes.
• If it is implemented right, it will have a huge
  savings.
• If not, it can even break a company.
• Quotes from Lee Pender, CIO, July 15, 2001

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Successful Implementation - Factor T

• A story is told in Cambridge,Massachusetts
• A young man, obviously a college student, is
  unloading his purchases at a super market
  checkout counter. A large sign above the counter
  indicates that it is for customers with 8 items
  or less, but the young man has at least twenty.
  The clerk tells him, You either go to MIT and
  you cant read, or you go to Harvard and you
  cant count.
• Jeremy F.Shapiro, Modeling the Supply Chain

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Factor T of Implementation

• A successful implementation of an SCM project
  needs both
• Breadth of knowledge (Managerial)
• and Depth of knowledge (Technical)

T in Technical and Managerial education was
proposed by U.Wemmerlov, Professor, School of
Business, UW, Madison
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Skill Set for Success

• Technical Know-How
• Domain Knowledge
• Change Management
• Project Planning and Execution
• Handling Execution Blues

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Technical Know-How

• Analytical Front
• SCM modules
• Multi-echelon systems
• Large-scale optimization
• Development Front
• Design of software
• Data Management, Scalable design, Speed, Quality
  of solution
• User Interfaces
• Integration w/ other modules and external systems
• Standards like RosettaNet

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Domain Expertise

• Understand peculiar problems specific to an
  industry
• No standard BOM in Automotive OEMs
• VMI in Retailing
• Kits in Tech sector
• Customer is the king vs. customer doesnt know a
  thing
• Some would want to be the first movers. Others
  follow the eaten apple strategy
• Benchmark studies
• Competitor info

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Change Management Unfreeze Change - Refreeze

• Strong motivation for change Create a sense of
  urgency
• Opportunity assessment
• Goals, Gap analysis, Pareto analysis, zero-in on
  the road-map of execution
• Value analysis
• Quantify benefits using measurable metrics like
  ROI, Inventory reduction and Lead time reduction
• Early Buy-in
• Demonstrate the impact
• Influence of culture Strategic thinking of the
  West vs Execution as the strategy in the East
• Sadagopan,S. Enterprise Applications Forecast.

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Change Management

• Successful change management
• Political sponsorship - Top management
  involvement
• Conflict resolution Top-Down vs Bottom-Up
  approaches
• Expectation management
• Some customers expect a radical re-engineered
  process and at the same time expect status-quo!!
• Resistance to change
• Employee reluctance
• Job security
• Time management Regular job tasks tasks for
  SCM project

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Project Planning and Execution

• Big Bang vs Incremental Blitzkrieg
  Implementations
• Big Bang
• Comprehensive, large scale (all modules) solution
  
• All requirements delivered
• All implementation problems identified, corrected
  and the end user gets a complete solution.
• Long lead time before actual use
• Incremental Blitzkrieg
• Focused, mini-scale, result-oriented go-lives
• Requirements added incrementally in each delivery
• User goes into action quickly
• Transition problems more severe in the initial
  deliveries

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Project Planning and Execution

• Rapid Implementations
• Where to start
• Splash effect, data availability, ease of
  implementation, urgency of needs, solution
  availability, etc., are some ways to prioritize
• How to reduce the time to implement
• Prefabricate
• Tailor-made industry specific solutions
• Examples i2s industry templates, mysap.com

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Project Planning and Execution

• Rapid Implementations
• How not to digress
• Solution planning as the first step in
  implementation
• Sign-off on the project scope
• Identify few key performance metrics to evaluate
  the project needs
• Dont deviate from softwares pre-established
  blueprints (fit organization to the software)
• How to manage data
• View data as a critical resource
• Provide specificities of data needs as much as
  possible to the users
• Levitin, A.V. and T.C.Redman, Sloan Management
  Review, Fall, 1998.

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Execution Blues

• Typical pain points From the eyes of the user
• Solution does not work as expected
• Performance (speed) is not satisfactory
• Too much of work on data management
• Too much of work outside the software solution
  (pre-process, post-process, UIs)
• Too little gotten for too much of money
• Over budget and time limits
• Show me the value

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Execution Blues, contd

• Typical pain points From the eyes of the
  solution provider
• Requirements keep changing
• Turnover of project members
• Composition of the team Not enough, not right
• Not enough support from the top management no
  change champions
• Issues in data access, quantity and quality
• Nit-picking by the users
• Restlessness of the users
• Resistance to change

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Handling the Execution Blues

• SCM projects are Socio-Technical Systems
• Successful implementations have various
  dimensions
• Art and Science
• Qualitative and Quantitative
• Technical and Managerial
• Effective communication and Networking

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What to Add to the Curriculum

• Technical Knowledge
• Technical emphasis - Problems in OR, Software
  project development and Bottom-line analysis
• Domain Knowledge
• Research, Benchmark studies, Guest lectures,
  Industry visits
• Change Management
• Case studies, Socio-Technical System studies
• Project Planning and Execution
• Managerial topics esp Project Management, Case
  studies
• Handling Execution Blues
• All of the above Working in teams,
  Presentation, Class Participation and Report
  Writing

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Discussion Points

• Challenges
• Will SCM be offered as a single course or as a
  set of courses?
• If one course - Do we have enough time to cover
  all the topics?
• If multiple courses Do we have enough material
  to justify a full set of courses?
• Do we have material available eg., on domain
  knowledge, heuristics?
• Can students (mostly with no industry background)
  appreciate the issues?