Just remember not to forget
What's the average memory span of a business? Judging by how quickly they make the same mistakes again, I would say six months. In fact, six months ago, we were told our selfish society lay behind our economic woes. We accepted our business decisions had been short-sighted and potentially fatal for many.
The optimists were hoping that the reset button had finally been pressed. Things would now be different.
Six months later, things begin to look awfully familiar. Compromising and giving things away in the spirit of supply chain collaboration is seen as ridiculous and suppliers are being paid later and later. A focus on volume to recover lost revenue threatens fragile sales and operations planning (S&OP) processes. The push to cut costs means the battle for leaner supply chains is still uphill. This business survival attitude is forcing collaborative planning, forecasting and replenishment (CPFR) off the agenda.
Surely it was this kind of behaviour that got us in this position. Where is the moment of clarity six months ago? For some firms, it was quickly followed by the usual knee-jerk reaction, swinging strategies from one extreme to the other. Although to be fair, I have noticed a difference. Businesses still talk about lean and agile supply chains, but most are finding it difficult to walk the walk ...
So while businesses seem to have six month memories, for individuals it's much longer, which is frustrating. You will no doubt know supply chain thinking is all just common sense. But you can probably see clues of your company sliding backwards towards the way it used to work.
My advice is "stick to your guns". Agreeing to compromises to cut risk does not mean that you lack the toughness required in these difficult times. You are actually thinking further ahead than many, planning longer term and learning from mistakes rather than repeating them! There is nothing ridiculous about that.
Hugh Williams is founder of supply chain specialist consultancy Hughenden
