Implementation Aspects of SCM
September 27, 2003
Shyam Bhaskar
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
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
can’t read, or you go to Harvard and you can’t
count.’”
Jeremy F.Shapiro, Modeling the Supply Chain
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
Skill Set for Success
•
•
•
•
•
Technical Know-How
Domain Knowledge
Change Management
Project Planning and Execution
Handling Execution Blues
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
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 doesn’t know a
thing
– Some would want to be the first movers. Others follow
the “eaten apple” strategy
– Benchmark studies
– Competitor info
Implementation Aspects of SCM - Shyam Bhaskar
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.
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
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 : i2’s industry templates, mysap.com
Implementation Aspects of SCM - Shyam Bhaskar
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
• Don’t deviate from software’s 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.
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
Execution Blues, cont’d
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
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
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
Implementation Aspects of SCM - Shyam Bhaskar
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?
Implementation Aspects of SCM - Shyam Bhaskar