Optimizing Your Supply Chain In An Ever-Changing World - January 23, 2009
Supply Chain Management Key To Maximizing Productivity.
Successfully managing a free-flowing supply chain allows companies to maximize profits and increase productivity in today’s evolving global marketplace, according to a panel of experts who spoke recently at the latest Main Street Institute.
More than 150 people participated in the lively discussion on Jan. 23 in the Campus Center at Indiana University-Purdue University-Indianapolis. The distinguished panel included several supply-chain experts and faculty members of the IUKelley School of Business at Indianapolis.
The panel included Mark Frohlich, associate professor of operations management; Barbara Flynn, professor of manufacturing management; Roger Schmenner, professor of operations management; and Mohan Tatikonda, associate professor of operations and technology management.
“The reality is … there is wild variability that exists in supply chains,” Frohlich told the audience, adding that Indiana’s manufacturing industry places it square in the middle of the supply chain formula.
Frohlich explained supply chains flow from suppliers to manufacturers, then on to warehouses and distributors with the ultimate stop being consumers. According to his research, the vast majority of businesses today are unsuccessful at integrating the supply chain to allow for maximum productivity. He estimated less than 10 percent of companies properly integrate their supply chain.
Flynn referenced her extensive research in the Chinese economy and how Chinese business operates using a distinct hierarchy of who controls the power. The accepted system of Guanxi, the idea of a reciprocating system of favors between business interests, is widely utilized in China.
“Anytime business is exchanged in China, the person who received it is obligated to return the favor. To not do so would bring great shame on you and your business,” Flynn explained.
Schmenner championed the idea of swift and even flow through supply chains, with the idea being reducing variations in quantities, quality and timing.
“What is going to win the race is slow and steady,” Schmenner explained. “We want once in motion, always in motion.”
Tatikonda closed the presentation by explaining how the Six Sigma theory of productivity affects supply-chain management. Six Sigma is a structured process to improve productivity through process improvements, redesigns and management.
By utilizing this method, used since the 1980s, companies can focus on and prioritize where improvements should be made.
“There are too many opportunities for improvement in this world, and we shouldn’t try to fix everything,” he said.
Main Street Institute is a partnership between the IU Kelley School of Business at Indianapolis and the Greater Indianapolis Chamber of Commerce. Through a series of workshops and seminars, Main Street educates business leaders on the latest trends in the economy and business sectors.
The next Main Street event is slated for March 20, when the topic will be “How Understanding Personality Type Can Propel Your Business.”
For more information, please contact Dave Hosick, coordinator of communications and media relations with the IU Kelley School at Indianapolis.
