Emerging mobility

Wherever you go in emerging markets, there seem to be an affordable way of getting your goods around. In Dar Es Salaam and Nairobi you have the two wheel push cart (Mikokoteni) and in Accra a more modern four wheel version.

 South East Asia prefers the three wheel motor-cart version, known for its high noise and air pollution. Not to mention Popeye like arms to steer the thing. In South Asia a three wheel Chinese agriculture machine is responsible for getting the job done, especially in rural areas.

 With fuel prices on the rise at the pump (and at the shop selling fuel out of an oil drum) you are likely to see more of these delivery vehicles as trucks fall out of favour. With electric bike sales going though the roof in Vietnam, is the three wheel delivery edition just around the corner?

 

 

What are the key best practices in the implementation of a supply chain system?

Senior executives who create a vision for the implementation of a supply chain system will achieve success with the roll-out and implementation. Without a clear vision, the project team will struggle and are unlikely to get the required buy-in.

The lack of a project approach without clear goals and timelines is likely to fail in any organization. Many businesses think that line managers will make the time to implement the required supply chain initiatives. The pressure of daily operational activities makes this an unlikely option.

Bureaucratic processes can lead to scope creep and have a severe negative impact on the project. Senior executive can play an important role in removing barriers and red tape and insuring a smooth transition.

Overlapping IT systems or future software implementation for resource planning systems (ERP), can slow down the implementation systems. It is important for the project team to have a clear understanding of the current and future IT infrastructure, and where overlap might occur. In some organizations, a combination of computer generated information and manually recorded information can create further confusion.

Organizational culture and change management are also two aspects that will impact the organization. Creating the right culture for change needs to commence prior to project team implementation.

Senior Executive untrained in the specific capabilities and requirements of supply chain often find it difficult to make operational decisions. Training requirements should not only focus on line managers,. They should be extended to senior executives also. Executive training programs and workshops can provide an important support structure for senior executives.

Supply Chain requirements are frequently designed based on production and raw material constraints. Process mapping and design must take into consideration customer needs and economic factors. The supply chain design should not be constrained by production and supply inefficiencies.

Prior to system development and roll-out, a model design is essential. The model should include current and future supply chain requirements. Furthermore, the decision making process needs to be clearly mapped out, with a clear process flow.

The importance of best practices is sometimes underestimated. Having clear best practices, within the organization, but also within the industry, will assist in the creation of a roadmap for supply chain effectiveness.

The decision making process must clearly map out and include all key stakeholders. Often, critical line managers are excluded from the process, and are not given the opportunity to design their own process goals.

Regular feedback meetings must be scheduled with all key stakeholders. Feedback meetings often provide the opportunity for senior executives to track progress and make necessary changes, if needed.

The right people must be on board from the start of the project. Often, project teams lack critical human resources and skills as key individuals are assigned to operational tasks and unable to devote their full attention to their respective project team.

The project team will benefits from using proven implementation methodology. The lack of a clear methodology will severely affect the project roll-out.

Conclusion

Buy-in and support is probably the best way to describe the successful implementation of a supply chain system. While the long term impact and benefits of having a supply chain are undisputed, the project implementation process should not be taken too lightly. Ensuring that all key stakeholders are onboard is one of the best ways to get there.

Emerging Market partner selection and management

Southern Africa has been consuming our time of late, and I we have been missing in action. We recently conducted a supply assessment and pilot roll-out for a media company in Zambia. Our workstream focused primarily on the Go-to-Market strategy and partner selection.

The following key issues were identified during the assessment:

Select the right partners. Ensure you have a clear understanding of the partner selection criteria. Identify the key drivers of partner success and include it in your selection criteria e.g. retail expertise. Communicate the selection criteria to all stakeholders and constantly evaluate if you are on the right track. Focus on distribution partners that hold real growth potential. Poor partner selection can severely affect your Go-to-Market strategy.

There is gold in those mountains. Emerging economies provide unique opportunities outside of the capital. Regional town populations and GDPs are always understated and hold great financial rewards with often little competition. By expanding your footprint, it is also important to create the necessary support structure for your more rural partners. They are too often left to their own devices.

Take the guess work out of your business. Standard Operating Procedures (SOPs) and retail standards (for example) simplify your business procedures and help to ensure the same quality in all operations. Emerging market operations often lack critical skills and don’t make any assumptions what people can and can not do.

What gets measured gets done. Focus on the key performance drivers of your business and don’t overextend yourself. Sometimes less is more. Include key performance measurements to your business planning process and evaluate on a yearly basis whether you are using these measurements to track and improve your business. There is no point it tracking something just for the sake of tracking.

10 key challenges for supply chain customer excellence

1. Processes and systems – lack of understanding of processes and systems and the impact on the supply chain
2. Detail – poor attention to detail
3. Cost - lack of understanding of service cost and breakdown
4. Revenue - fixated on the revenue implication of each customer improvement
5. Collaboration – poor partner collaboration in the feedback process
6. Visibility – customer issues not visible to all supply chain partners in the network
7. Continuous improvement – continuous improvement are not taking place as supply chains evolve
8. What matters – poor understanding of which services or services aspects really matter to customer
9. Management involvement – limited management involvement in the customer service process
10. Tracking – poor tracking and monitoring of customer feedback

Material Requirements Planning

Material Requirements Planning helps companies control quantities of materials they purchase, plan production quantities and ensure that they are able to meet current and future customer demand, all at the lowest possible cost. Here are some key questions to ask.

10 key barriers with partner collaboration

1. Culture differences. Different organizations have different values and ways of doing things.
2. Poor alignment. Organizational goals and incentive conflicts.
3. Contracts and legal. Poor drawn up contracts or lack of contracts.
4. Accountability issues. Overlapping processes and unclear accountability issues.
5. Competing partners. Conflict of interests with competing organizations.
6. Lack of leadership. Lack of leadership to drive the collaboration process forward.
7. Communication. Poor communication between partners and lack of knowledge sharing.
8. Technology barriers. Integrating ERP and other tech systems provide unique challenges.
9. Unclear benefits. Benefits are not clear to all parties or are sometimes understated.
10. Corrective actions. Fail to identify problems and implement corrective actions.

10 key issues for evaluating inventory

1. Forecasting process. What is the current forecasting process and who is involved in setting targets?
2. Information technology. Identify the current IT system(s) employed by the company and are regular upgrades and improvements taking place with partners?
3. Collaboration. How much does collaboration take place between the various internal and external partners?
4. Items overstocked and out of stock. Which items are over and out of stock and what are the reasons? Is there a pattern emerging in the data?
5. Expired and out of date. What are the current product shelve life’s and what is the affect on the forecasting?
6. Safety stock factor. Are you using a safety stock factor and is it the same for all product SKUs and classes?
7. Product life cycle. What is the current product life cycles and how do the various SKUs differ from one another?
8. Lead times. Identify the product lead times and are there potential bottlenecks?
9. Process flow and visibility. Do you have a clear understanding of the inventory flow and are there potential opportunities to reduce time wastage?
10. Continuous evaluation. Is continuous evaluation and tracking taking place and what are the required KPIs?

A greener reverse logistics

Reverse logistics is increasingly becoming a factor for manufacturers and customers. Reverse logistics can be defined as the flow of purchased products back to the supply chain for recycling, replacement or disposal. Some of the benefits of a well planned reverse logistical process are:

Reducing energy or fuel cost. A better network distribution design will reduce energy cost, and provide savings to all on the supply chain network. Furthermore, energy efficient assets (e.g. new environmentally friendly bottle coolers) will not only save costs for customers, but will also have a positive impact on the environment.

Improved packaging design. Improved packaging and design can reduce transportation cost and reduce waste. Improved packaging and an effective reverse logistics design will increase recycling and reduce the need for landfills. It can furthermore provide opportunities for the reuse of products and packaging (e.g. returnable bottles).

Less expired products. An improved system will furthermore reduce expired products and save money for both manufacturer and customer.

Competitive edge. A more effective and greener reverse logistics process can provide the organization with a competitive edge in the market, and lead to improved brand loyalty and brand recognition.

Sales data collection

Not all sales systems can be automated right away. However it is important to start with small improvements. These improvements can be standardized forms or simplified forms e.g. checkboxes. The following needs to be analyzed:

• Data collection process
• Accuracy of data
• Potential collaboration with sales partners
• Data entry simplifications
• Timeliness of data

10 key attributes of establishing Key Performance Indicators (KPIs)

1. Key stakeholders- involve key stakeholders in selecting KPIs
2. Visibility- create a KPI dashboard visible to all parties
3. Adding value- ensure KPIs add value to your business and highlight opportunities for process improvement
4. Customer focus- selected KPIs should add value to your customer’s business and ultimately improve the consumer experience
5. Financial impact- always keep in mind the bottom line
6. Direction- by evaluating key KPIs, you can determine the direction your business is heading
7. Education- it is important to train your employees and services partners so that they have a clear understanding of each KPI and how it adds value to your and their businesses.
8. Focus- limit KPIs and don’t try to track too much;  you are likely to lose focus.
9. Baselines- Create clear baselines you can measure your business against and track progress
10. Eliminate- evaluate the usability of each KPI and do not be afraid to eliminate KPIs that are not adding value to your business