leadership challenge in global supply chain … challenge in gscm jan 5 05 r1 .pdfhkstpc -...

HKSTPC - Leadership Challenge – Jan 5, 2005 @ QuST DR STEPHEN W.K. NG, IPSHK

Technology Exchange Forum

Logistics & Supply Chain Management Enabling Technologies

January 5, 2005 - 6/F, Room 601 Hong Kong Convention & Exhibition Centre (Old Wing)

Dr. Stephen W. K. NgPresident, The Institute of Purchasing & Supply of Hong Kong

Leadership Challenge in Global Supply Chain Management


What is Supply Chain Management?

SCM provides companies with a boundary -

spanning channel focus where “All the steps of a

product’s movement, regardless of corporate,

political, or geographical boundaries, from raw

material supply through final delivery to ultimate

user to satisfy a particular customer group” are

planned and supervised.

- Cooper in CTSCM


What it means to today’s market leaders?• SCM provides innovative competitive strategies

that enable them to leverage the capabilities of coalitions of companies to reinvest whole industries and create new competitive space for supply channels.

• SC focuses on the actual business functions, cooperative relationships, and the daily management of logistics, demand management, and financial transactions upon which a particular application of SCM is founded.

- D. F. Ross -


Can you please help find my parent!!! a 2 years old boy found and taken from Khao Lak Resort (from Tsunami)


Supply Chain Evolution….. From 1960’ of PDM

‘70’s ‘80’s ‘90’s

Warehousing Physical Distribution

倉庫及貨物之銷售

Logistics & Planning

物流計劃

Supply Chain & Change

供應之改變

Storage & Transport

Cost Focussed

Not Integrated

Product Movement

Cost Focussed

Customer Emerges

Material Planning

Technology Enabled

Business is tougher

A Passion for Service

Process Orientation

Strategic Collaboration

‘00’s

Global Supply Chain, CRM, VRM & ERM

全球供應鏈管理

Customer Focussed

SCM with SCM

CRM + ERM to win

BARCODE/EDI/XML/RFID

RELATIONSHIP

產品銷售管理到供應鏈的運作

獨立運作整合運作


10X Cycle Time

1960’s 1970’s 1980’s 1990’s 2000’s

Product

Price

Quality

Quality, Speed & Service

Information, People, Technology &Integration, The GSCM

Semiconductors Industry Drivers Change Over Time

Six Sigma

PerformanceExcellence and GSCM


世界已經改變However, World has changed…

• It’s no longer the big beats the small,

• the new business game is that the fast eats the slow

企業不論大小 , 速度取勝

客户滿意為先


Global Supply Chain ManagementStock or Goods Flow

Information Flow• Enterprise

Resources Planning

• Warehouse Management

• e-Procurement• Market Research• Cash Management• Sourcing

• Enterprise Resources Planning


• e-Procurement• Market Research• Logistics

Management

• Sales & Distribution Management

• Customer Relation Management


• e-Procurement• Market Research• Transport

Management

• Sales & Distribution Management

• Customer Relation Management

• Category & Space Management

• EPOS scanning• Warehouse Management• e-Procurement• Market Research• Reverse Logistics

Material Supplier

Manufacturer Distributor Retailer ConsumerPKKI

HKU

Funds FlowHuman Resource or People Flow

Supported by e-Commerce and Services…


Survey: clear movement to process management

Source: PWC Survey 1998

0%

20%

40%

60%

80%

100%

1992 1998 2002Functional Management

Process Management

% of responses

achieving a management

style

不斷从“纵向一体化”向“横向一体化”转化

纵向

横向


Benefits from Global Supply Chain Management

一流的企业通过供应链管理获得了竞争优势，供应链管理总成本比一般企业少5%-6%（占销售收入的）

供应链管理总成本

销售收入%

98年最好的企业98年平均值


The 12 imperatives for outstanding supply chain performance

Managing at the pace of change

12 th imperative: agility and the ability to respond to change

How do we future proof and build agility into, our supply chain operations in

response to the pace of external change and ever increasing pressures from

shareholders and competitors?

The key enablers7 th imperative: business structure and organisation

8 th imperative: process and performance measures

9 th imperative: people and behaviours

10 th imperative: high performance partnerships

11 th imperative: leveraging information and technology

How do we align the who enterprise –people, processes, operations, technology, suppliers, and other business partners –

around a programme of progressive strategic change?

The strategic imperativesAdding value to the customer1 st imperative: the customer value driven supply chain

2 th imperative: differentiation through the product offeringSearching for structural advantage3 th imperative: global operations restructuring

4 th imperative: strategic sourcing and co-venturing partnershipsBusiness integration and performance drivers5 th imperative: integrating/synchronizing the supply chain network

6 th imperative: operations beyond the productivity edge

How do we deliver distinctive value and differentiated service to local customers,

while at the same time exploiting opportunities from a globalised view of

supply chain?

Source: PWC


Three Kinds of Companies Need To Change

In The Concept of MH’s Reengineering

1. Companies in deep trouble. They have no choice.

2. Companies not yet in trouble but have the foresight

to see trouble coming.

3. Companies that are in peak condition. No

discernable difficulties. Seek to raise the

competitive bar even higher.How about

your company??


“ I am convinced that if the rate of change inside the institution is less than the rate outside,

the end is in sight “ J. Welch

Supply Channel management is a change management Supply Channel management is a change management where you have to partner with more people to earn an where you have to partner with more people to earn an effective change. Procurement Leader can and should effective change. Procurement Leader can and should play a critical role for the total success of any play a critical role for the total success of any organization. organization. S. Ng S. Ng

For example:


The Challenge to Corporations and You as GSCM & Procurement Professionals (PP) is to …

Trigger

…Redefine andReposition

Adopt BestPractices

DoNothing

Prosper

Survive

Fail

Advantage

Decay

Parity

RIP

….. There comes a time in the history of every company where they have to change dramatically to move to the next level of performance. Miss that moment ….. and they begin to decline.

A. Consulting

SIX SIGMA


Bob Galvin’s Message

“People have an ability to do things that appear almost impossible - but only if they set the very highest of expectations.

These expectations may seem a little above one’s abilities, but if one reaches out to those expectations, one can very often discover how much more can be accomplished.”.

主席的座右銘

最高可以達到的目標

突破自己

The bel

ief


The GSCM Worldwide is to manage…

• Business Process Integration

•JIT/JIC•QR•Integrated Logistics Management•SCM•ECR•CRP / ERP•DC & RDC•Warehouse Automation•Outsourcing - 3LP•Cross Docking•VMI•CPFR•Electronic Commerce•SC Benchmarking•4th Party Logistics Provider

Emerging SCM Trends


More radical approach• Thinking “out-of-the-box”

• Pushing Management to think:– cross functional, – boundary spanning,– integrated supply chain, – toward virtual supply

chain– cultural issues– technology i.e. FFID


Business Process Model With JIT Concepts Reengineering takes a process approach in contrast to the functional way most companies approach their business and organization structure.

Functions drive the business

Functional

Underlying business processes are

acknowledged but functions still dominate

Matrixed

Process drive for JIT and reengineering

Process / JIT Focused

FINANCE

MANUFACTURING

MARKETING

PRODUCTION

ORDER FULFILLMENT

PRODUCTDEVELOPMENT

FINANCE

MANUFACTURING

MARKETING

Modified from A Consulting

HOW?


Commitment

Interdependent

Interactive/Aligned

Investment

Transactional

Understanding

Hostile

Connection/Culture

Synergistic

Integrate

Collaborate

Synchronized

The Journey to Synchronization

From A Consulting & QuST…

Silo

Communication

Stream

The GSCM evolution

The effect of * Globalization,* e- Commerce, & * The new economy


Supply Chain to e-Hub

“Parts

focused”SupplierSupplier DistributorDistributorTHE THE

COMPANYCOMPANYCustomerCustomer ConsumerConsumerSupplierSupplier’’ss

SupplierSupplier

Information Flow

Product FlowFrom

Customer support

Manufacturer (oem)

Distributor / reseller

Supplier Logistics

Advanced Supply Chain ManagementCharles Poirier

to

“Information

focused”


Strategic Outsourcing PartnershipStrategic Outsourcing Partnership

Insourcing:

Strategic Direction

Transportation Management

Business Processes

Distribution Operations

Traditional Outsourcing:


Strategic Direction

Transportation Management

Business Processes


Strategic Partner Outsourcing:外判戰畧伙伴

4PL Business Processes

TransportationManagement

Financial Services

Strategic Direction

(In Supply Chain Management Concept)

內判及整合

外判及整合


Time to Significant Benefit

Resource Investment

1/2 Year

Partners

Alliance

Collaboration

Benefit & Cost/Effort

Alliances

Relationship is "easy".

The usual “drivers” are• Technology• Market Positioning• Scale Leverage To...

• Lock-out competition• Align with world-class name• Generate growth/awareness

Collaborators

More or larger problems require high cost and resource investment. The return must be significant to justify this decision:

‘Drivers’ can be :

• Cost• Quality• Competitive Necessity • Logistics• Technology• Productivity

Partners

The high return and/or criticality of a relationship justifies the ongoing resource and cost investment.

‘Drivers’ can be:

• Cost• Technology• Ensure availability of scarce raw material, technology or process

Limited Some Considerable

1 Year

1+ YearsHIGH

LOW

Possible Relationship Spectrum


The GSCM Transformational LeadersConsider……

* Incremental change (i.e. TQM) isn’t enough for many companies today. They don’t need to change what is; they need to create what isn’t.

Some people see things as they are and ask why, transformational leaders see things as

they never were and ask why not……


SIX MUSTS FOR GLOBAL SUPPLY CHAIN LEADERSHIP

6. We must treat I.T. as an enabling tool to offer Speed & Quality.

1. There must be a strong commitment and involvement towards total supply channel development.

2. There must be strong belief in integration & linkage.

3. There must be high expectations in total services.

4. There must be trust & respect between partners.

5. There must be good communication.


The Power behind GSCM is the Leadership of Managing ….

• New economy• E-everything• Outsourcing• Value Chain• Globalization• People• Integration

For Customers

By focusing on Agility,

Adaptability and Alignment


歡迎交流歡迎交流

Thank You!

leadership challenge in global supply chain … challenge in gscm jan 5 05 r1 .pdfhkstpc -...

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