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Here’s something interesting you should try. For one month, carry around a notepad and record a tick mark every time you hear (or say) the word “never”. You might be amazed at just how popular that seemingly innocuous five-letter word is.
As for us, “never” is our least favourite word in all of Webster’s. It’s an evil word, made all the more dangerous by the fact that it is continually thrown about without a moment’s thought or reflection on what it actually means.
The biggest problem with “never” is that, far too often, it’s the beginning of a self fulfilling prophecy of defeat. How many conversations like this have you overheard?
“Wouldn’t it be great if we could <insert cool idea here>?”
“Yeah, it would. But it’s never gonna happen because <insert excuse here>.”
“I guess you’re right. Best not to waste any time trying.”
Of course, not trying essentially guarantees that nothing will happen and the prophecy is fulfilled!
How do you try to gain a competitive advantage in your organization? As retail supply chain consultants, we are often asked by clients to let them in on current industry best practices. One small problem – “current industry best practices” is really just a euphemism for “what everyone else is doing”. By definition, this has no hope of leading to a competitive advantage.
The only path toward performance altering change that will allow you to leapfrog your
competitors is innovation. You need to do the never.
A few years ago we were working for a large retailer, charged with figuring out how to better plan product flows throughout the entire supply chain. Our design called for forecasting consumer demand, product by product, store by store and week by week for a full year into the future.
We figured that once you cracked that nut, you would have a basis for modeling the future “chain reaction” of demand through every node in the supply chain, right back to the factory using simple, intuitive rules.
Imagine that you could somehow know every product movement that will be taking place in your supply chain, every day for the next 52 weeks. POS sales for every product at every store on every day for the next year. Every resultant replenishment and shipment request between every store, distribution centre and manufacturing plant in the extended supply chain.
Imagine that this information is completely updated, refreshed and extended on a daily basis. When POS sales come in higher or lower than expected, the precise impact to every other node in the supply chain is instantly and automatically modeled. If store sales were higher than expected today, not only are the DCs and plants notified, but their replenishment and manufacturing schedules will be instantly updated to reflect the impact of the change on their operations.
Imagine how your fill rate would soar with these early warning signals continually hopping through the supply chain – not only with “news from the front” but with specific actions that need to be taken by each partner to respond to it.
Imagine how productive your assets (particularly inventory) would be if your planning information was so virtuous that you could wait until the last possible moment to deploy them and still make your service commitments.
The reaction from some folks was typical (and a little surprising to naïve, wide-eyed
dreamers like ourselves):
“You’ll NEVER be able to calculate and manage that many forecasts!”
“You’ll NEVER get suppliers to agree to ship to a schedule! They need firm purchase orders way in advance!”
“It’s impossible to forecast anything at store level!”
“Do you know how many forecasts that is? You’ll NEVER find a computer big enough to do it!”
“With the culture here, it’s NEVER going to happen!”
It’s funny though. Nobody ever said that the idea was ill-conceived or flawed. Quite the opposite. We haven’t met a single person yet who doesn’t believe it makes perfect sense.
But even as this dream is becoming a reality as we speak, some people still look at us like we’re yammering idiots whenever we talk about running the entire supply chain with store level forecasts of consumer demand.
It seems the ultimate success of the idea will depend on those who see the ultimate goal – those who see the word “never” as a dare rather than a discouragement. Those who see only obstacles will just be along for the ride.
Things often don’t happen as quickly as we like, but do yourself a favor and be careful with using the word “never”. What seems impossible today is tomorrow’s competitive advantage, so keep your eye on the finish line, not the hurdles!
- Small Data, Big Insights - July 14, 2016
- Is Flowcasting the Supply Chain Only for the Few? - June 3, 2016
- Philosophy - February 12, 2016