SCM End to Ends
From points A to Z, but how smooth was the ride?
We’ve all been there at some point or another. We’ve managed to see a multi-step process through from start to finish but feel it could have gone a lot better; surely there must be a better way. Perhaps communication wasn’t as effective as it could have been, there were too many workarounds that had to be employed or perhaps too much effort and time was wasted on the the small details.
We discussed the supply chain in the previous blog; just think of all the moving parts and elements at work that must work in tandem to achieve the end. If you thought the supply chain and navigating all its intricacies was complicated just imagine managing it. While the supply chain is more the overall mechanics of how a product goes from concept to arriving in a consumer’s hands, Supply Chain Management (SCM) involves a more holistic view. “End to end” is a term that’s been adopted to help better direct and focus all the disparate elements that are at work within a supply chain. The expression end to end was borrowed from the world of computer networking where the focus is on the end hosts rather than the intermediary ones. In the world of goods and services the focus is on the end consumer. It is this end consumer who drives demand and without them, the supply chain wouldn’t even exist.
The goal in end to ends is to get from the starting point to the end point as efficiently and effectively as possible for all parties involved. Imagine information being passed between neighbours. If the information is lobbed over the fence and the receiving party is not ready for it or don’t know what to do with it, then the flow is stopped and there’s a delay in moving it on to the next neighbour. Even worse, what if someone’s stuck waiting on their side of the fence but nothing appears or when it finally does arrive it’s unusable and can’t possibly be passed on as is. Momentum is lost and effort wasted either through idle time or reworking. In the world of SCM, keeping topmost in mind that the end customer is the most important player can help better focus all the activities within the chain. This focus on the final destination also helps avoid many of the inherent common pitfalls such as getting bogged down during intermediary steps and allows one to think outside their own individual silo.
We now live in a world where due to globalization businesses can expand exponentially. Companies from different countries and continents work together towards achieving a common goal. To look at it simplistically, there needs to be a way to bring all these people and companies together on common ground where they can communicate and there is fluidity back and forth. A core objective in SCM end to end thinking is to enable scalability, increase workforce productivity and reduce operating costs. It’s a method of creating a common figurative “language” that all components in the end to end process understand. One company that has achieved this is IKEA. They have successfully created a language all their own that is understood worldwide. You could ask people in several countries thousands of miles apart what a “Billy” is in IKEA vernacular and they’d be able to tell you it’s a bookshelf.
While the concept of end to end is particularly useful in the world of supply chain management it can be applied to other areas within a business as well. By employing this thinking more broadly it could help streamline all processes and activities that are undertaken across all aspects of a business. For example:
- Human resources: hire to retire
- Client services: order to fulfillment
- IT: issue to resolve
- Accounting: invoice to payment, record to report
- Sales Execution: idea to offer, order to cash
- Purchasing: procure to pay
- Asset Management: Plan to inventory
- Operational Planning: Forecast to delivery
- Marketing: Market to order
- Sales Terms: Credit sales management
- International Distribution: Market Entry to Exit
Whether we realize it or not we all play a role in some sort of end to end process. Are the actions we take in fulfilling our duties aligned to the processes that come before and after and overall do they contribute effectively to the achievement of the end goal?
RSVP for Change: What are the end to ends that you are involved in? Do you know who sends information, goods or services to you and is it presented in a manner that you can use it? How about the goods and services that you provide? Does the information only need to be touched once or does it require rework?
Management Insight: High level, are you aware of what end to ends are the most strategic, supporting your corporate objectives, within your organization. Does everyone understand their roles and is the processes moving as efficiently as possible? Help your organization to focus on the key end to ends to improve the expediency of information movement.
Linda Craig (@LindaCraigRSVP)
More Supply Chain insights at www.Retention.ca