Implementation Aspects of SCM September 27 2003 Shyam

Implementation Aspects of SCM September 27, 2003 Shyam Bhaskar Implementation Aspects of SCM - Shyam Bhaskar

SCM Project Impact • SCM implementation is one of the most difficult projects a company undertakes. • If it is implemented right, it will have a huge savings. • If not, it can even break a company. Quotes from Lee Pender, CIO, July 15, 2001 Implementation Aspects of SCM - Shyam Bhaskar

Successful Implementation Factor T A story is told in Cambridge, Massachusetts: “A young man, obviously a college student, is unloading his purchases at a super market checkout counter. A large sign above the counter indicates that it is for customers with 8 items or less, but the young man has at least twenty. The clerk tells him, ‘You either go to MIT and you can’t read, or you go to Harvard and you can’t count. ’” Jeremy F. Shapiro, Modeling the Supply Chain Implementation Aspects of SCM - Shyam Bhaskar

Factor T of Implementation • A successful implementation of an SCM project needs both Breadth of knowledge (Managerial) and Depth of knowledge (Technical) ‘T’ in Technical and Managerial education was proposed by U. Wemmerlov, Professor, School of Business, UW, Madison Implementation Aspects of SCM - Shyam Bhaskar

Skill Set for Success • • • Technical Know-How Domain Knowledge Change Management Project Planning and Execution Handling Execution Blues Implementation Aspects of SCM - Shyam Bhaskar

Technical Know-How Analytical Front • SCM modules • Multi-echelon systems • Large-scale optimization Development Front • Design of software – Data Management, Scalable design, Speed, Quality of solution • User Interfaces • Integration w/ other modules and external systems – Standards like Rosetta. Net Implementation Aspects of SCM - Shyam Bhaskar

Domain Expertise • Understand peculiar problems specific to an industry – No standard BOM in Automotive OEMs – VMI in Retailing – Kits in Tech sector • Customer is the king vs. customer doesn’t know a thing – Some would want to be the first movers. Others follow the “eaten apple” strategy – Benchmark studies – Competitor info Implementation Aspects of SCM - Shyam Bhaskar

Change Management Unfreeze – Change - Refreeze • Strong motivation for change – Create a sense of urgency – Opportunity assessment • Goals, Gap analysis, Pareto analysis, zero-in on the road-map of execution – Value analysis • Quantify benefits using measurable metrics like ROI, Inventory reduction and Lead time reduction* • Early Buy-in – Demonstrate the impact – Influence of culture: Strategic thinking of the West vs Execution as the strategy in the East *Sadagopan, S. Enterprise Applications Forecast. Implementation Aspects of SCM - Shyam Bhaskar

Change Management • Successful change management – Political sponsorship - Top management involvement – Conflict resolution – Top-Down vs Bottom-Up approaches – Expectation management • Some customers expect a radical re-engineered process and at the same time expect status-quo!! – Resistance to change • Employee reluctance • Job security • Time management – Regular job tasks + tasks for SCM project Implementation Aspects of SCM - Shyam Bhaskar

Project Planning and Execution • Big Bang vs Incremental Blitzkrieg Implementations Big Bang – Comprehensive, large scale (all modules) solution – All requirements delivered – All implementation problems identified, corrected and the end user gets a complete solution. – Long lead time before actual use Incremental Blitzkrieg – Focused, mini-scale, result-oriented ‘go-lives’ – Requirements added incrementally in each delivery – User goes into action quickly – Transition problems more severe in the initial deliveries Implementation Aspects of SCM - Shyam Bhaskar

Project Planning and Execution • Rapid Implementations – Where to start • Splash effect, data availability, ease of implementation, urgency of needs, solution availability, etc. , are some ways to prioritize – How to reduce the time to implement • Prefabricate – Tailor-made industry specific solutions – Examples : i 2’s industry templates, mysap. com Implementation Aspects of SCM - Shyam Bhaskar

Project Planning and Execution • Rapid Implementations – How not to digress • Solution planning as the first step in implementation • Sign-off on the project scope • Identify few key performance metrics to evaluate the project needs • Don’t deviate from software’s pre-established blueprints (fit organization to the software) – How to manage data • View data as a critical resource* • Provide specificities of data needs as much as possible to the users *Levitin, A. V. and T. C. Redman, Sloan Management Review, Fall, 1998. Implementation Aspects of SCM - Shyam Bhaskar

Execution Blues Typical pain points – From the eyes of the user • Solution does not work as expected • Performance (speed) is not satisfactory • Too much of work on data management • Too much of work outside the software solution (pre-process, post-process, UIs) • Too little gotten for too much of money • Over budget and time limits • Show me the value Implementation Aspects of SCM - Shyam Bhaskar

Execution Blues, cont’d Typical pain points – From the eyes of the solution provider • Requirements keep changing • Turnover of project members • Composition of the team – Not enough, not right • Not enough support from the top management – no change champions • Issues in data access, quantity and quality • Nit-picking by the users • Restlessness of the users • Resistance to change Implementation Aspects of SCM - Shyam Bhaskar

Handling the Execution Blues • SCM projects are Socio-Technical Systems • Successful implementations have various dimensions – Art and Science – Qualitative and Quantitative – Technical and Managerial – Effective communication and Networking Implementation Aspects of SCM - Shyam Bhaskar

What to Add to the Curriculum • Technical Knowledge – Technical emphasis - Problems in OR, Software project development and Bottom-line analysis • Domain Knowledge – Research, Benchmark studies, Guest lectures, Industry visits • Change Management – Case studies, Socio-Technical System studies • Project Planning and Execution – Managerial topics – esp Project Management, Case studies • Handling Execution Blues – All of the above + Working in teams, Presentation, Class Participation and Report Writing Implementation Aspects of SCM - Shyam Bhaskar

Discussion Points Challenges • Will SCM be offered as a single course or as a set of courses? – If one course - Do we have enough time to cover all the topics? – If multiple courses – Do we have enough material to justify a full set of courses? • Do we have material available – eg. , on domain knowledge, heuristics? • Can students (mostly with no industry background) appreciate the issues? Implementation Aspects of SCM - Shyam Bhaskar