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Supply Chain Excellence Requires Maturity

By Dr. Robert L. Gordon | 03/14/2016 | 7:19 AM | Categories: Current Affairs

Guest Post by Dr. Ernest L. Hughes, Associate Professor, Transportation & Logistics Management American Public University System

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Excellence in supply chain performance is often characterized in terms of a capability or maturity model. The Merriam-Webster Dictionary defines excellence as “extremely high quality,” and mature as “having reached a final or desired state,” that is to say, fully developed. In addition to providing a framework for understanding and managing the inherent detailed and dynamic complexity of an organization’s supply chain, a maturity model can provide a roadmap for improvement.

Typically, an organizational assessment is utilized to determine the level of supply chain maturity, identify performance gaps, select appropriate improvement factors, and plan a course of change to reach the next level. Gartner’s logistics maturity model has five stages.¹ The maturity model developed by IBM’s Institute for Business Value has five stages, too: (1) static supply chain; (2) functional excellence; (3) horizontal integration; (4) external collaboration; and (6) on demand supply chain. This model reflects the movement supply chain performance toward the goal of synchronized supply - changes in customer demand automatically adjust purchasing, manufacturing, and logistics plans.²

In his doctoral dissertation, Dr. Heriberto Garcia developed and validated a Supply Chain Capability Maturity Model, abbreviated S(CM)2, and a methodology to apply it. Dr. Garcia developed his model from an extensive literature review of enterprise modeling frameworks and industry supply chain models, and multi-round Delphi surveys of industry experts. The supply chain maturity levels in S(CM)2 are: (1) undefined; (2) defined; (3) manageable; (4) collaborative; and (5) leading. Each stage has from one to seven prioritized key improvement factors. The table below summarizes these levels and factors.

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The methodology utilizes questionnaires that Dr. Garcia asserts can be used even by non-experts to assess an organization’s supply chain maturity from seven different views or processes: (1) Suppliers; (2) Production systems; (3) Inventory; (4) Customers; (5) Human resources; (6) Information systems & technology; and (7) Performance measurement systems. Each of these views of a supply chain can be, and most likely would be, at different levels. Each view can be analyzed from three abstraction levels: operational, technical, and strategic. Garcia integrated maturity levels, improvement factors, views, abstraction levels, and useful tools in a framework, and also defined a short-hand notation for a supply chain assessment report to quickly state the levels of each view. Utilizing a maturity model like S(CM)2, Supply Chain Leaders have a straightforward, systematic way to know where their organization’s supply chain has been, where it is today, and where it should be headed in the future.

 

References

Aimi, G., Lisica, J., & Gonzalez, D. (2014, August 25). Apply the five-stage maturity model to drive logistics excellence within the supply chain. Gartner, http://www.gartner.com/document/2831020.

Huettner, H., & Song, W. (2007). Follow the leaders: Scoring high on the supply chain maturity model – Mainland China perspective on forward-planning supply chain processes. 3. Garcia, Heriberto. (2008). A capability maturity model to assess supply chain performance. FIU Electronic Theses and Dissertations. Paper 191, http://digitalcommons.fiu.edu/etd/191/.  

 

 

PROFILE

Dr. Ernest L. Hughes (“Ernie”) is an Associate Professor of Transportation & Logistics with the American Public University System (APUS). He teaches courses in Logistics Management & Operations, Comparative Transportation Systems, History of Transportation, Ports & Terminal Operations, and Retail Shipping & Receiving. Dr. Hughes is also principal with Logistikos, his consulting network focused on improving supply chains through better collaboration, integration, innovation and change management. Prior to launching his teaching and consulting practices, Dr. Hughes enjoyed broad leadership responsibility in a range of organizations for more than thirty years. He was most recently Director of Technical Services for Recreational Equipment, Incorporated (REI). Before joining REI, Hughes was co-founder and Chief Information Officer for Cascadia Community College after a fifteen-year technology career with Boeing in a range of technology and management positions. Dr. Hughes earned an MS in Global Supply Chain Management from the University of Alaska Anchorage, a Doctorate in Organizational Leadership and a Masters in Software Engineering from Seattle University, an MBA in Organizational Behavior at California State University, Bakersfield, and an undergraduate degree in Computer Science from California Polytechnic University, San Luis Obispo. He is a senior member of the American Society of Quality (ASQ), vice president of the Pacific Northwest chapter of INFORMS, member of the Board of Directors for the Western Washington Chapter of the Institute of Supply Management (ISM), and a member of the Association of Change Management Professionals (ACMP).

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About Dr. Robert Lee Gordon

Dr. Robert Lee Gordon

Dr. Robert Lee Gordon is program director of the Reverse Logistics department at American Public University. Dr. Gordon has over twenty-five years of professional experience in supply chain management and human resources. He holds a Doctorate of Management and Organizational Leadership and a Masters of Business Administration from the University of Phoenix, as well earning a Bachelor of Arts degree in History from UCLA. Dr. Gordon has spent more than 14 years teaching reverse logistics, transportation, project management, and human resources. He has published articles on reverse logistics; supply chain management; project management; human resources; education, and complexity. He has also published four books on Reverse Logistics Management; Complexity and Project Management; Virtual Project Management Organizations, and Successful Program Management..



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