How to Transform an Organization into a Supply Chain Centric Model. It Starts and Ends with People. Why not use Pay-For-Knowledge?

 

 

How to Transform an Organization into a Supply Chain Centric Model. It Starts and Ends with People. Why not use Pay-For-Knowledge?

By Dr. Tom DePaoli

For more leadership stories on transforming organizations try my book Leadership by Storytelling on Amazon. https://amzn.to/2ZuuQEz

          Most supply chain professionals are familiar with the best practices of a supply chain organization and how to transform purchasing into a lead strategic partner in a company. These usually include a thorough spend analysis to focus on the major areas of materials and services.  Another aspect includes the rationalization of suppliers and the formation of a few key partnerships with important suppliers. The institutionalization of a comprehensive sourcing methodology is also crucial. The area that is often overlooked or neglected is the investment in people!

          Many purchasing professionals have been rewarded for bureaucratic and tactical behaviors for many years. The culture of risk aversion is prevalent and roles are particularly well-defined and limited. They focus on a particular material or service and become “experts” on these items. Often, they work in silos and have no real connection with operations. It is usually not their choice but the expectations of the culture or of their organization.

          The retraining of supply chain professionals begins with developing the capability to lead cross-functional teams not only in sourcing, but in process improvement activities such as Lean and Lean Six Sigma. Most need to reach the level of at least a green belt in a process improvement approach, and to reinvent themselves to be total product experts not just a particular material expert.  You have to be a product expert to understand the Voice of the Customer (VOC) or what is really important to them. This requires striving to become an expert in an entire industry not just a narrow material. It also requires a dedication to understanding and working with operations. Performance reviews need to be tied into how well they do in predicting the market trends of their particular industry and meeting or exceeding the VOC.

          All too often this training is piecemeal, unorganized and uncoordinated. Fortunately, there is a comprehensive approach that has been around for forty years that works in many industries particularly ones where employee knowledge is highly valued like the chemical, oil and process industries. The approach has been called pay-for-skill or pay-for-knowledge. Employees are paid more for each skill or knowledge area that they develop, and demonstrate their proficiency in by job performance.  It does require a significant monetary investment by the organization in training employees and the organization evolves to a continuous learning campus.  The word campus is critical because many organizations partner with local technical schools or universities to jointly provide the comprehensive training and courses.

Unfortunately, many organizations have disinvested in training employees and would rather outsource for many skills or functions. This is deadly to the supply chain concept and process improvement, which must strive to constantly improve the entire supply chain from start to finish without breaks which may or may not be performed better by an outsourced entity.

          The major objection to the pay-for-skill approach is the cost and the length of time for payback from the employees improved knowledge. Once in place, however; the power of this employee intellectual capital, and the momentum of continuous improvement, establishes a supply chain centric organization that is nearly impossible to beat competitively.

People transform supply chains and organizations not technology or best practices.

Dr. Tom DePaoli, (Dr. Tom) is currently an independent management consultant, the Principal of Apollo Solutions, which does general business consulting in the human resources, supply chain and lean six sigma areas. His organization was self-founded in 1995. He retired as a Captain from the Navy Reserve. In other civilian careers, he was a supply chain and human resources executive with corporate purchasing turnaround experience and lean six sigma deployments. He has worked for over ten major companies and consulted for over fifty organizations throughout his career. Some of his consulting projects include: information systems projects, re-engineering organizations, transformation, e-procurement, e-commerce, change management, global sourcing and negotiating. His industry experience is in the chemical, paper, pharmaceutical, IT, automotive, government, consumer, equipment, services and consulting industries. He has been published extensively in journals, magazines and books. He is the author of eleven books all available on Amazon.  He has instructed at six education facilities in numerous roles. He is active in supporting the YMCA, Wounded Warrior, and the prevention of the bullying of children.

https://www.amazon.com/author/tomdepaoli    = Dr. Tom’s Amazon author’s page

http://www.apollosolutions.us  = website of Apollo Solutions his business

drtombooks.com  = more information on Dr. Tom’s books

http://www.linkedin.com/pub/dr-thomas-depaoli/0/736/6b3/  = LinkedIn home page

 

 

Learn how to use the supply chain centric model #supplychain

https://www.linkedin.com/pulse/how-transform-organization-supply-chain-centric-model-depaoli-1e

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ

Leading From the Front

 

Leading From the Front

In my experience in both corporations and the military, I have found that procurement and supply chain people are more likely to excel and survive in chaos. They become excellent crisis leaders since they deal with more crises than their colleagues. Many evolve to the next level of preventing crises in the first place, developing risk management plans and pre-planned contingency plans.

They become crisis hardened veterans able to make the right decisions quickly and with authority. Most of us are more comfortable with a participatory democratic leadership style, but this just does not work very well during a crisis. Crisis management needs strong leading from the front. Procurement and supply chain leaders often step up to this level.

https://buyersmeetingpoint.com/blogs/entry/exceptional-leadership-traits-for-procurement-and-supply-chain

 

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Offer Solutions, Not Problems and Try to Keep the Solutions Simple.

 

 

Offer Solutions, Not Problems and Try to Keep the Solutions Simple.

My team was sent overseas to work in a warehouse in a third world country and assist in inventory verification and the shipping of items to another location. When we started one of the forklift operators got on a forklift and started to work. The brakes were not working properly and luckily the forklift did not crash. My deputy was aghast and near panic. He came to me with the problem and asked what to do next. I decided that it was time to instruct my deputy in offering solutions to problems not just stating the problem. I suggested composing a forklift safety checklist for the forklift driver before they start the shift and just to be safe have two individuals complete the checklist and sign it when it is completed. He soon caught on and then used initiative and contacted the forklift manufacturer to provide their checklist before the forklift was operated. The manufacturer also sent us a video on how to check their forklifts before operation. My deputy then used this solutions approach for the rest of the trip. Offer solutions, not problems and try to keep the solutions simple.

 

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ

Take Care of Your People. Take Care of Your People. Take Care of Your People

Take Care of Your People. Take Care of Your People. Take Care of Your People

The title of this article was the advice my Dad gave to me when I asked him what should I do as a leader just before I became an officer in the US Navy. Take care of your people. (he repeated it three times)

People really value little things that you can do for them, but often their bosses or leaders don’t understand what is important to them. I once was in charge of a huge warehouse complex in San Diego for a one-month assignment. It was January, which is the worst weather month in San Diego. None of the ware­houses were air-conditioned or heated. The temperature would fall to the low forties or upper thirties in the morning, and many of the forklift drivers were not used to this type of chilly weather.

I managed to obtain some surplus sweaters for all of the forklift drivers to wear. We set them up in one area of the warehouse so that they could be used by employees when they were cold.

I didn’t realize how appreciative the employees were of this gesture until three years later, when I returned in the same month for a similar project. I was told to report early to the conference room in the warehouse. Much to my shock, every warehouse employee was in the warehouse was wearing one of the sweaters, and they all greeted me with a standing ovation and a cake.  I didn’t want to let them down, so that year I secured wool watch caps for them.

 

I later wrote a book Broken Windows Management (available on Amazon). The whole one message or premise of the book was this: Prevention of disorder and actually fixing things that employees say are wrong; goes a very long way in establishing trust and credibility with management (also leader). If what they request is reasonable, give it to them.  Management and leaders must be vigilant and constantly try to control disorder and fix the things and issues that employees’ value.  These actions reduce employee fear of management and actually help gain trust. Trust is enhanced by quickly fixing things that employees want fixed. Unfortunately, many organizations have not figured out this simple axiom yet. Many companies, because their employees do not trust them, will never get enough credibility to execute broken windows management actions.

 

Take care of your people.

 

Contact Dr. Tom = thomasdepaoli@yahoo.com drtombooks.com for newsletter sign up https://drtombooks.com/contact/ My Books link: https://www.amazon.com/Tom-DePaoli/e/B003XSV1IQ