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Thursday 28th September 21:10 (UK)

Supply chain collaboration
– are you ready for the uncomfortable truth?

July 25th, 2023

 

It has long been recognized that effective supplier relationships are based on collaboration not confrontation. Japanese manufacturing techniques and Lean thinking brought the practice of Partnership Sourcing to the West in the 1980s when most supplier relationships were then adversarial. However in many industry sectors these old behaviours still hang around….

In many ways a successful relationship with each supplier is like a marriage:

  • You want the best for each other.
  • You need openness, honesty and straight-talking to hear and understand
    your partner.
  • You are willing to address any problems to keep the marriage mutually beneficial.

How many businesses are ready for this type of openness with their suppliers? Ready to hear uncomfortable truths about their business practices and their people? Open to accept rather than reject such information? Committed to taking action to address problems identified by suppliers?

Procurement and Supply Chain managers need have a strategic outlook and be strong enough to bring feedback and criticism from suppliers into the business and not feel threatened by it. They must not consider such a ‘public appraisal’ as a sign of poor management of their functions. They must not fear that the board might consider new management is needed in these functions given the problems revealed. Instead they must embrace the feedback and see it as providing opportunities for improvement.

As shown in the table, driving performance improvement through effective and sustained collaboration with suppliers can only be enabled when the Supply Chain/Procurement Leadership has a strategic focus on the inbound supply chain. They will thus accept the need for free and honest dialogue with suppliers (including sharing uncomfortable truths) as a key part of the improvement journey. The business culture also needs to be progressive enough to encourage and fund such collaboration. Digital tools can help businesses build on this solid foundation to enable effective collaborative improvement.

In marketing our new zuppli digital service, that uses two-way assessment to drive supply chain performance improvement, we have seen these challenges first hand. zuppli provides each supplier with a quarterly assessment of their performance against key metrics such as delivery, quality and transactional cost and shows each supplier how they compare in these metrics with other suppliers (anonymously). This information catalyses supplier improvement and helps them focus their improvement activities. Companies like this functionality. This helps amplify the resources and efforts of their internal Procurement/Supply Chain resources.

But zuppli also provides companies with an assessment of the company’s performance in the previous quarter – made by their suppliers – against key metrics such as demand planning, order management and ease of doing business. It also captures and shares supplier critique and improvement suggestions (anonymously to encourage straight-talking by suppliers).

Such feedback is key to supply chain improvement as the company’s people, processes and systems define the environment that suppliers to operate in. That environment can help or hinder supplier performance. For example, late deliveries by suppliers may well be due to many short lead-time orders placed by the company – rather than poor-performing suppliers…. An effective supply chain requires good performance at BOTH ends of the chain.

So just like a marriage, a healthy relationship is needed to ensure a couple stays together in a mutually beneficial relationship. And that includes open and honest communication. It includes the ability to give and receive the truth ̶ often uncomfortable at times  ̶  and to take action. Unfortunately too many businesses lack the supportive culture and a strategic focus in the supply chain to recognize the need and the value of really listening to their suppliers, hear uncomfortable truths, capture their improvement ideas and then take action to address root cause problems. The impact of Covid and the war in Ukraine have reduced many Procurement/Supply Chain functions’ ability to take strategic initiatives; instead driving a tactical focus on availability and price. This has pushed supplier collaboration further down their agenda.

Companies need to see their suppliers as more than simply supplying parts, materials and services. They need to see them as also supplying information and ideas. To consider them as external collaborators with capabilities to help drive innovation within the shared supply chain  ̶  for the mutual benefit of the company, its suppliers and ultimately its customers.

 

Thanks to Frits Thomsen, Director SCAT3 and Dave Carter, Codexx Associates, for their ideas and comments on this article.

For more information visit www.zuppli.com

 

New edition of ‘Thinking about value’

November 30th, 2022

We’re pleased to announce that the 2nd edition of ‘Thinking about value – and how to innovate it’ by Alastair Ross, Director of Codexx, has just been published on Amazon.
 
This new edition builds on the 2019 edition with multiple examples of the value table in practice, new frameworks for defining customer requirements, other content enhancements (and of course a few corrections…) – and at the same price as the 1st edition.
 
The book is a practical guide for change leaders and product/service innovators with frameworks, tools, case studies and 50 innovation approaches for innovating new or existing offerings.

Alastair Ross thanked MBA and MSc students at the University of Southampton Business School and Codexx clients for ‘real world’ application of the value table model in business projects.

The book is available now in paperback and pdf on Amazon.
 

Innovation project with HLB

May 30th, 2022

We just completed an innovation project with HLB, a leading global advisory and accounting network. In this work we helped HLB build a framework to analyse its innovation maturity across the globe and define an improvement programme.

We utilised our F4i (Foundations for Innovation) assessment solution and database in performing this work.

zuppli available in Denmark and Sweden

December 9th, 2021

We are very pleased to announce that Codexx has signed an agreement with scat3 of Denmark to provide the zuppli digital supply chain service to progressive businesses in Denmark and Sweden.

scat3 provides consulting and solutions to help businesses improve and digitalize their supply chains to improve their competitiveness. More information at scat3.com.

The zuppli digital service was developed by Codexx to help businesses drive supplier performance improvement via two-way performance transparency. More information available at zuppli.com

Alastair Ross, Director of Codexx said: “I am excited to be working with scat3 to make zuppli available to customers in Denmark and Sweden. Over many years of working with businesses in Scandinavia I have experienced their culture for innovation and exploiting new ways of working. I believe that these progressive businesses will embrace the opportunities that zuppli offers them for driving supply chain performance improvement.”

New papers on supplier performance improvement

July 19th, 2021

If you’re interested in supplier performance and how to improve it, take a look at the new whitepapers we’ve added on the zuppli.com website, available to download.

New zuppli digital service for supplier improvement

March 22nd, 2021

We’re pleased to be announce the launch of a new digital service – zuppli – to help businesses improve the performance of their suppliers.

zuppli allows businesses to assess (and be assessed by) their suppliers every quarter, to provide a full ‘two-way’ view of their inbound supply chain. This information provides the foundation for driving improvement – in both suppliers and a business manages its supply chain.

zuppli is the result of a number of years work by Codexx and its software partner. It leverages our expertise in benchmarking and new cloud technologies. zuppli gives businesses a highly cost-effective and easy-to-deploy solution to help them catalyse, analyse and implement improvements in their suppliers.

For more information on the zuppli service go to www.zuppli.com

 

Driving supplier performance improvement

November 26th, 2020

Our latest whitepaper discusses effective approaches for driving supplier performance improvement and looks at how improving performance transparency in the inbound supply chain can help.

Your can read the paper here:

How do you enable high performing suppliers – CODEXX WHITEPAPER

zuppli supplier performance improvement – new video

September 28th, 2020

We have just released an updated video of our new zuppli cloud service for helping businesses drive improved supplier performance. zuppli utilises a unique ‘two-way’ assessment to encourage collaborative improvement between businesses and their suppliers. zuppli is focused on product-based businesses such as manufacturers, distributors and MRO (maintenance and repair operations.

Currently zuppli is available for demonstration and our initial service is expected to be launched in November. For more information contact Alastair Ross

You can view the video on our Youtube channel here.

10 years since I started Codexx – what have I learned?

August 25th, 2020

Today is the 18 year anniversary of when my consulting business – Codexx Associates Ltd – was incorporated in the UK. I mentioned this to a good friend and he asked me what my thoughts were about it 18 years ago. It prompted me to think about what I’ve learned in those 18 years. So here are 10 things that I’ve learned.

1. Determine the goals for your business – that work for you

Some want to build an empire, others a small-holding – neither is right or wrong. I left my corporate consulting job and started Codexx as I wanted to do interesting, innovative and useful consulting projects, help clients, build a good reputation, keep a good family-work balance and have fun. A smart farm-sized knowledge-based business with no company politics if you like…

2. Have a clear proposition and market

This is one of the toughest tasks. Coming from a consulting career in a big corporate I had lots of experience and thus potential services I could provide. But as a small consultancy you need to focus. A wide portfolio is simply not credible to clients. You need a few service areas that you can focus on, become expert and get known for. Start with areas that you are passionate about and expert in and where there is a ready, profitable and sustained market.

3. Be prepared to change your proposition and market

As our military tell us ‘No plan survives contact with the enemy’ – in this case markets and competition change and your business must adapt if it is to survive and prosper. My original focus sector was Industrial due to my past experience, but I later found a major market in professional service businesses seeking to codify and re-engineer their services. I successfully pivoted Codexx to increase focus in this area. I’m currently working with a partner on a new digital service for supply chain improvement that came out of a consulting project a few years back, when I wondered why we couldn’t do this on the internet…

4. Work to differentiate your offering

In this digital and globalised business world, it is all too easy to find that your offering is being commoditized. There are smart people everywhere, many of them able to deliver a similar service to yours much more cheaply. You need to identify critical areas of your service that clients value and can enable effective differentiation on elements other than price – things like personal relationships, proprietary methods and data (e.g. benchmarking), quality, experience and industry knowledge. You also need to identify lower value services or service elements that you should move out of. It’s an ongoing and dynamic battle to avoid being sucked down the plughole of commoditization.

5. Build your network and create win-win

Codexx is built on an associate model. One of my goals was to have a variable cost consulting model so that I was not spending my time ‘selling the bench’ to cover fixed costs and therefore sometimes providing non-optimum consulting skills to clients. I built a network of experienced consultants and academics that I brought in on Codexx projects to build a team with the skills and expertise needed for client projects. Ensure your associates are also ‘winning’ too. Pay them fairly for their work and treat them with respect; let them benefit from being part of your network.

6. Find good clients and serve them with all your energy and passion

This is simply critical to your business success. Good clients are of course profitable clients, but they are also progressive clients who are open to new ideas, won’t micro-manage you and from whom you can learn from. Unfortunately not all clients will be like this…

7. Build a thick skin

You’ll need this for selling and also working in some clients. What can you do to minimise this unpleasantness? Build a differentiated offering and marketing approach that makes selling less competitive. And work with clients for more than just the money (though this is not always possible in tough times).

8. Be brave and keep challenging the norms

Business consultants are there to change things – to make things better. Many times clients will recognise that improvement is needed. But many times they won’t. With your multi-business, multi-sector experience and awareness of new methods and technologies you can see the possibilities of improvement and new methods that your clients may not. So you will get push-back: ‘That won’t work here’, ‘It’s not practical’, ‘That’s just crazy’. Some sectors are naturally conservative and resistant to change. I found the established paradigm in the legal sector was that you couldn’t have both low cost and high quality – it was one or the other. Successful legal service re-engineering projects broke this paradigm. But it was a constant battle. You have to believe in yourself, use objective evidence, find internal champions, start small and demonstrate success.

9. Keep learning

We live in a time of such change with new methods and technologies constantly emerging. And in your client projects you receive ongoing lessons on different approaches and outcomes – on what works well and doesn’t at all. You need to continue to keep your offerings relevant to client needs and regularly improve them (and yourself) based on your experience. For the last few years I’ve been teaching consulting and innovation to MBA and MSc students. The old maxim ‘to teach you must learn’ is so true! Indeed the more I learn, the more I realise how much more I need to know. So whilst you need to be confident in your abilities as a consultant, don’t forget to keep some humbleness – you can always learn new things and be better.

10. Maintain your perspective

Stress and overwork is the regular bedfellow of many professionals and most small business owners. Sometimes it can all become too much. Your business is important, but you are more important. Don’t forget that.

End point

I hope this is of use to some of you looking to start your own consulting businesses. Of course the nature of learning is that this time next year I’ll have an updated top ten list…

Alastair Ross is Director of Codexx Associates Ltd and also teaches consulting and innovation on MSc and MBA programmes at the University of Southampton Business School. His latest book ‘Thinking about value’ is available on Amazon.

This article was originally published on LinkedIn on 10th July 2020.

Thinking about value

November 20th, 2019

How do you ensure that you take a broad and structured approach to product and service innovation – that is customer focused and simple to do?

Read Alastair’s article on LinkedIn.

Energizing Change

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