Leadership & Behaviour
To ensure supply chain management is actually implemented successfully, whether within or between organizations, it is very important that all the professionals involved collaborate well with one another. That might sound obvious in theory but it is far from easy in practice, because conflicting interests can mean that activities such as purchasing, logistics, sales, production and planning could get in the way. How can you prevent that?
Creating effective supply chain collaboration requires more than just analysis and the execution of targeted projects. In addition to the technical aspects, it is absolutely vital to give enough attention and recognition to the human factor in supply chain management. That’s why supply chain management includes supply chain behaviour – meaning leadership, culture and competencies.
Supply chain leadership
Leadership is a very important part of supply chain behaviour. But what exactly is supply chain leadership? A lot has been written about leadership in the scientific literature and it is also a popular topic at conferences. The interesting thing about supply chain leadership is its non-hierarchical component. On paper, a supply chain leader is often only responsible for part of the chain, even though that manager is actually entirely responsible for its total output. If we think back to the definition of supply chain management:
Within most organizations, the supply chain manager has hierarchical responsibility for the ‘plan’, ‘deliver’ and ‘return’ parts but not for the ‘source’ and ‘make’ parts (see the SCOR model for a more detailed explanation). Instead, ‘source’ often falls under Purchasing and ‘make’ is the responsibility of Production.
Within most organizations, the supply chain manager has hierarchical responsibility for the ‘plan’, ‘deliver’ and ‘return’ parts but not for the ‘source’ and ‘make’ parts (see the SCOR model for a more detailed explanation). Instead, ‘source’ often falls under Purchasing and ‘make’ is the responsibility of Production.
Managing operational aspects which fall outside of the scope of your hierarchical responsibility as the supply chain manager or supply chain director demand effective leadership. In order to do this, the supply chain professional will need to adopt a leadership style that can best be described as ‘inspiring and coaching’, and definitely not a dominant, authoritarian or distrusting style. The ultimate aim is to ensure that everyone in the organization is pulling in the same direction, with the same goal: optimum customer service.
Supply chain culture
Additionally, supply chain behaviour calls for a supply chain culture. It may sound obvious that, since supply chain management is about creating collaboration, it requires a specific culture that stimulates and fosters collaboration. Scientific research commissioned by BLMC has explored the relationship between the culture and the supply chain performance. It clearly revealed that a culture revolving around openness, information sharing and working together towards common goals achieved considerably better performance.
Supply chain competencies
Supply chain competencies are the third aspect of supply chain behaviour. In addition to revolving around the competencies that support successful and effective supply chain collaboration, such as the ability to communicate clearly and openly, it also requires values such as integrity in terms of information sharing and the fair division of the benefits and results of successful collaboration.
Over the past decade, BLMC has conducted numerous assessments of supply chain professionals. We have concluded that successful professionals have a unique set of skills which we describe as the ‘supply chain competencies’.