What are the greatest supply chain and logistics articles of all time?
I have often thought about that question over the years without really putting much time or mental energy into coming up with the answers to the question, which I’ve not seen anyone else tackle either.
So I hope to come up with a top 10, based on my subjective criteria of innovation, quality and influence. Most will come from journals such as the Harvard Business Review, but other sources as well. I am reaching out to others for their input. I would welcome reader input.
I am started a few months ago with just one that will certainly be in that list of ten, and that is “A Triple A Supply Chain” by Dr. Hau Lee of Stanford University and published in 2004 in the Harvard Business Review. (See The Top Supply Chain Articles of All Time.)
Gilmore Says.... |
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While I love the article title and concept about stapling yourself to an order, I think it’s relevance has waned significantly since 1992
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This week, I will summarize one of my favorites, “Stapling Yourself to an Order” written by Benson Shapiro, Kasturi Rangan, and John Svioloka (Shapiro being the most well-known of the trio.). It was first published in 1992 in the Harvard Business Review, and republished I think two times thereafter as an “HBR Classic.”
Here’s what Shapiro, Kasturi, and Rangan had to say about the matter, including this great line: “Every time the order is being handled, the customer is being handled at the same time.”
They added that “The truth is that every customer’s experience is determined by a company’s “order management cycle” - the ten steps, from planning to post sales service, that define a company’s business system,” the article says early on.
What are those 10 order management steps? They are listed below (obviously not all apply to every business):
Order Planning: Design of the order management process
Order Generation: How and where orders will be solicited and acquired
Cost Estimation & Pricing: Providing quote or price to customers
Order Receipt & Entry: Capturing a new order and starting the workflow (manual or automated)
Order Selection & Prioritization: What orders are most important, and how will they be handled sequentially?
Scheduling: Moving the order into a production or fulfillment plan
Fulfillment: Delivery to the customer
Billing: Customer invoice process
Returns & Claims: Handling any returns or complaints about damage or other product issues
Post Sales Service: Service and support activities (warranties, replacement parts, etc.)
As the title of the article makes clear, the recommendation was that company executives should walk with an order over days or weeks or even months, early on, from as many of the 10 steps that make sense to learn how it really works and look for opportunities to improve cost, speed or customer service/satisfaction.
Now does that 10-step framework and recommendation to follow the process, proposed more than 30 years ago by our authors, still make sense in a ecommerce world with ERP and much more powerful order management software and increased “digitization” of business processes?
I am not sure. Clearly the original article was tilted towards discreet manufacturers, and arguably specifically to make-to-order business.
But back then, for those types of companies, I have no doubt much insight could be gained from stapling yourself to an order. I’ll note 1992 would have been maybe a decade before the start of the big company focus on “business process re-engineering.” That wave found things like steps in a process taking days to move through, even though the actual work once say an order made it to the top of the queue took perhaps 15 minutes.
But even today, does any one person in a large company with multiple order processing steps have a full grasp of the end-to-end order management cycle? Certainly, more do so today than in 1992, for at least major parts of the OMC. Many companies have well-defined and streamlined “order to cash” processes, as the most obvious example.
The tremendous growth in outsourcing and offshoring since 1992 has also caused changes to this concept, as supply is now often part of a much longer and sometimes more complicated supply chain – but maybe simplifying domestic order management that now relies on stock items made overseas.
So in the end, while I love the article title and concept about stapling yourself to an order, I think it’s relevance has waned significantly since 1992 – but that there are still probably plenty of companies where such a order tour would pay benefits.
I would love your thoughts on this.
Is stapling yourself to an order still a relevant concept? Let us know your thoughts at the Feedback button below.
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