No two supply chain integrations are ever the same. But after many years of onboarding new customers, I have learned that there are three basic components to most integrations. And I like to think of it in cooking terms. Below are the steps we followed for one of our latest supply chain integrations:
Step 1: Invent a new recipe
This is the step where we plan what the new supply chain will look like. For example, a recent consumer products company we worked with needed a supply chain built from the ground up. In helping them design the right solution, we reviewed where products are manufactured, used historical shipping data to determine where customers are, and pinpointed ideal distribution center locations. This and other information was used to provide a business case for change.
Step 2: Make the recipe and taste it
Here’s where we execute against the new supply chain. After the planning stage, we have to make it happen. This includes a timed roll out based on the shipper’s needs—just like in the kitchen, some projects take longer than others to finish. This particular customer’s integration moved rather quickly—the time from signing the contract to implementation took less than 85 days.
Step 3: Add new ingredients
Just as the greatest chefs in the world are always adjusting their signature dishes, supply chains should always be improved too. No matter how well designed a supply chain is, the market will inevitably change or internal initiatives will shift and the supply chain will need to adjust accordingly. This is a critical step that should never be skipped.
Ensuring the integration is a success
As you can imagine, making significant shifts in where or how supply chain operations occur have a great potential to impact the customer. So, while the basic recipe for an integration is pretty simple, there are additional considerations we make to ensure the integration avoids disrupting the business as much as possible.
- The order of ingredients matters
Just like it’s important to cream sugar and butter together before adding flour when making cookies, all integrations should follow a process. This is one of the best ways to protect a shipper’s customers from disruption. Keep in mind that while the steps of a process should be rigid, how they’re applied to a shipper’s business should be flexible and tailored to their needs.
- Great chefs listen to the people eating their food
If I’ve learned anything about successful supply chain integrations, it’s that you have to work with people across the organization. For example, focusing on the wants of only the executives can leave the voice of the functional teams unheard.
It’s also important to think beyond supply chain professionals. Include individuals from accounting, internal communications, even sales and customer service. Their different perspectives make sure all aspects of the business are thought of in advance.
- Is success a five-star rating? Or just a clean plate?
How do we define success? Clearly define and regularly measure key performance indicators (KPIs) based on the organization’s needs. And as I mentioned earlier, different parts of the organization will have different definitions of success. Knowing that the dock managers want to improve on-time pickups and that executives want to know, “How often do we meet customer metrics?” can make setting KPIs easy.
How to make all this happen
A supply chain integration is all about removing chance. Removing the chance that the process (and ultimately the solution) won’t go well. To do that, you need expertise.
Typical shippers don’t need to plan entire supply chain overhauls day in and day out. But that’s what logistics service providers do, which is why 3PLs can successfully integrate new businesses without disrupting their customers’ day-to-day operations in the process.
Kevin Six is the vice president of Global Accounts at C.H. Robinson. Kevin has held key executive positions in sales, account management, global integration, large account management and demand & supply chain connectivity. He gained his experience at market-leading companies in the transportation asset, software development and 3PL sectors. Kevin holds a Bachelor of Science – Business Administration degree from Winona State University of Minnesota.