Back in 2017, I wrote a post highlighting four things supply chain and logistics professionals should stop doing in the new year. Since those things still apply today, I am resharing them again below. I also added a couple of more things to stop doing in 2024 and beyond.
Recommendations from 2017 that still apply today…
- Stop viewing technology as a silver bullet. With so much innovation happening in technology, it’s so easy to chase the next new shiny thing, whether it’s artificial intelligence (AI), Internet of Things (IoT), and countless other emerging technologies. But technology won’t solve your supply chain problems or help you improve unless you also address the most common culprits of poor supply chain performance: poor data quality, lack of resources and training, lack of metrics and accountability, and poor communication and collaboration with trading partners (see resolution #3 below). For related commentary, see “There’s No Silver Bullet for Supply Chain Visibility” and “Forget Innovation, Just Execute Better”.
- Stop viewing logistics as a cost center. As I highlighted in “Your Supply Chain Strategy is Your Business Plan (Unless It’s Not),” the people who really need stop viewing logistics as a cost center are not the people in the front lines of supply chain and logistics (they already know it), but the CEOs and CFOs at manufacturing and retail companies. Yet most of those executives have never step foot in a warehouse or loading dock and would probably get lost trying to find it. Simply put, companies that continue to view logistics as just a cost center and put it at the bottom of their investment priority list, will experience a decline in customer satisfaction and loyalty, which will also bring down their market share and profitability.
- Stop bullying your suppliers, carriers, and other trading partners. Extending payment terms to 120 days or more. Bullying suppliers over price cuts. Taking a “I Win, You Lose” approach to negotiations. All of these actions might improve your financial performance in the short term, but as history has shown over and over again, bad things happen in the long term (quality issues, supplier bankruptcies, etc) when you increase the cost of doing business for your suppliers and trading partners but still demand price decreases from them. For related commentary, see “Walmart’s Message to Suppliers: Talk to the Hand,” “The High Cost of Poor Supplier Relationships,” and “Time to Squeeze Carriers for Better Rates?”
- Stop passing the buck on responsibility when it comes to creating socially responsible and ethical supply chains. We’ve seen many examples in recent years where companies have passed the buck of responsibility to suppliers or other parties when supply chain issues related to labor, safety, environmental, or legal practices have surfaced (e.g., the collapse of the garment factory in Bangladesh that killed hundreds of ‘slave-labor’ employees, Rip Curl apparel marked “Made in China” actually being made in North Korea). When it comes to these types of serious supply chain problems, saying “I didn’t know” is no longer an acceptable excuse (if it ever was). As I’ve written before, if you want to create socially responsible and ethical supply chains, you have to develop a more granular and detailed understanding of your supply chains; you have to improve the way you communicate and collaborate with your suppliers, especially lower-tiered ones; and most importantly, you can’t outsource the responsibility — the buck ultimately stops with you, the brand owner.
For related commentary, see “Forced Labor In Supply Chains: The Problem Persists,” “Proving The Absence Of Forced Labor In Supply Chains,” “Made in ‘I Really Don’t Know’,” and “GM Supplier Factory Explosion: Thoughts on Supply Chain Visibility and Responsibility”.
Other things to stop doing in 2024 and beyond:
5. Stop excluding frontline workers (“power users”) from technology evaluation and selection process. In a survey we conducted in December 2022 with members of our Indago supply chain research community — who are all supply chain and logistics executives from manufacturing, retail, and distribution companies — almost three quarters of the respondents (74%) said that they have experienced buyer’s remorse with the purchase of a supply chain/logistics technology solution. One of the key contributing factors: they didn’t involve their power users in the technology evaluation and selection process.
As Aaron Levie, CEO of Box, wrote in a November 2013 Harvard Business Review post titled “IT Can No Longer Afford to Ignore Its Users”: “The history of enterprise technology has been fairly unforgiving to the people intended to use it. For the past half-century, most information technology models propagated two unassailable truths: that enterprise technology was purchased by a select few, and the technology was bought for the company. As for the delight of the individuals using the technology itself? They’ll deal.”
Levie’s point was echoed by several of our survey respondents, like this executive: “You need to involve all stakeholders, from the operators to decision makers. Most of the time, decision makers do not have hands-on experience in operations and thus are unable to define the requirements properly.”
For related commentary, see “Preventing Buyer’s Remorse with Supply Chain Technology.”
6. Stop confusing Cooperation with Collaboration. In an April 2015 Harvard Business Review article titled “There’s a Difference Between Cooperation and Collaboration,” Ron Ashkenas writes, “Having worked with hundreds of managers over the years, I’ve seen that very few admit to being poor collaborators, mostly because they mistake their cooperativeness for being collaborative.”
What’s the difference between collaboration and cooperation? Corey Moseley highlights the difference in a Jostle blog post: “Collaboration is when a group of people come together and work on a project in support of a shared objective, outcome, or mission [it implies shared ownership and interest in a specific outcome], while Cooperation is when a group of people work in support of another’s goals [e.g., you help me on something I’m working on and that I’m ultimately responsible for].
In a September 2023 Indago survey, we asked our members, “Do you agree or disagree with Ron Ashkenas that many people mistake being cooperative with being collaborative?” Almost a third of our member respondents (32%) “Strongly Agreed” with Ron Ashkenas; another 55% “Agreed” with the statement, while only 5% “Disagreed.”
“Collaboration requires a much bigger commitment than cooperation: time together, mapping end-to-end processes, data sharing and analytics,” said one Indago supply chain executive. “Trust, similar cultures, shared objectives, and executive commitment are necessary for collaboration.”
Do you agree with these six things to stop doing? What else would you add to the list? Post a comment and share your perspective!