Is supply chain leading or mainly suffering within business? That is the recurring question that supply chain professionals continue to wrestle with. The Supply Chain Excellence Leadership Platform (SCELP) is convinced that supply chain can be more directive and needs to think more strategically. The expertise platform invited supply chain manager Jeroen Dekkers on 27 November to show how his team within McDonald's Netherlands has succeeded in this. "We now focus more on the process and less on the result," he said.
The SCELP meeting on strategy took place in the week after Black Friday and Cyber Monday. Marketing and sales departments of retailers came up with the most amazing actions to attract consumers to their shops. It was up to supply chain to arrange that those consumers were not faced with empty shelves. "At times like that, the supply chain department is more suffering than leading," argues Jack van der Veen, professor of supply chain management at Nyenrode Business University. "Often we only have to execute what marketing and sales have come up with. The question is how we can exert more influence as a supply chain. We need to start thinking more strategically."
Within McDonald's Netherlands, the supply chain department was also often suffering. The work was rarely valued, says supply chain manager Jeroen Dekkers. "It was too much or too little, too expensive or not sustainable enough. We could never get it right in the eyes of other stakeholders. That had repercussions on the team. That got stank, was the prevailing feeling."
Process-oriented
Dekkers has managed to turn the situation around. The supply chain department has become more in the lead. One of the changes is that Dekkers' team is focusing less on the result and more on the process. "For McDonald's, four factors are important: quality, price, availability and sustainability. With every decision we try to be better balanced with respect to those factors."
An example is marketing's question on whether the price of beef can come down. "We have agreed to answer 'yes' to every question. Yes, the price of beef can come down, but then we have to accept that the quality drops or animal friendliness is compromised. By communicating in a different way, we can make better decisions together. In this case, it shows that price reduction cannot be at any cost."
Just do it
Dekkers also brought the just-do-it mentality to the team. Don't spend too long talking, but get moving. "Due to climate change, crops are becoming more unpredictable. A few years ago, we even had lettuce flown in from the United States. That cannot be the intention. That's why we started water cultivation. The idea is that this will allow us to get lettuce from greenhouses in the Netherlands all year round. Whether it works and is scalable, we don't know. We just started trying it, while of course maintaining the values important to McDonald's such as quality and safety."
More than before, McDonald's supply chain has a connecting role in the chain. When marketing comes up with an idea for a new product that no supplier can deliver, Dekkers' team brings both parties together. "We choose more of a listening role. What does marketing really want? It then often turns out that the difference with the supplier's offer is not so great at all. Questioning is an essential skill that we want to further develop and apply."
Collaborative atmosphere
Dekkers cites the greater focus on the people factor as the most important change. "We no longer recruit new colleagues on their experience in supply chain, but on their focus on processes. We don't want people who tell us how many millions they were responsible for as a buyer, but people who want to make an impact. Those will take our team and our organisation forward."
Dekkers asks his employees to start the conversation with people from other departments. Why does a marketer get so angry when an item is out of stock? "Does he not trust us? Does he think we are not doing our best? By starting the conversation, we remove the tension. That creates a completely different collaborative atmosphere," says Dekkers, who calls on SCELP members to play that connecting role within their own organisations as well. "Then we can make the step from suffering to leading."
Strategy
After Dekkers' presentation, a discussion on strategy arises within SCELP. Studies show that many companies do not have a good business strategy, let alone a supply chain strategy aligned to it. Should supply chain then take a leading role in creating a sound business strategy? And if so, how should that role be fulfilled? That is one of the four themes SCELP will be looking into in the coming period.
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