The holidays will be here before you know it and so will 2014. Most companies are busy working on budgets, forecasts and tactical and strategic plans. Like most people I dread even the thought of these activities – until I sit down with my team and again realize how important the planning process is to effectively manage business. The reality is that the planning process never stops - it’s a cycle that evolves from day to day and month to month. The overall global economy doesn’t stand still - new technologies are developed every day and a well-oiled planning process differentiates winners from losers.

In October I had the pleasure of speaking at one of the advanced sessions at PARCEL Forum. PARCEL Forum is always a great opportunity to network, see old acquaintances, entertain customers and develop new relationships. But what I enjoy the most about PARCEL Forum is the opportunity to learn. Similar to previous years, I always want to ensure that the material I present is thought provoking. I want people attending to leave the session and feel that it was valuable and that they learned something new or at least refreshed a concept that had been temporarily left behind. And while the terms, words and perhaps even model I presented are fundamentally basic to every supply chain, the proper application of these principles is elusive to too many organizations. Too many companies operate their supply chain in a static environment – a supply chain is a dynamic environment, one that needs to be managed fluently on a daily basis. This is the model I presented – it revolves around four core principles that help maximize supply chain efficiencies. 

The first step is all about gaining visibility. Gathering data into a centralized location so that the foundation is built and the following three steps can be implemented. Businesses can’t even start the planning process without having the proper data. We frequently see customers with poor planning processes as a result of not having the visibility and data they need to develop the best plans. 

The second step and often the most difficult principle to implement is achieving transparency. Now that we have all of this data what does it mean? How do we effectively analyze the information to best understand our business and our competitors? How do we develop short-term and long-term strategies to grow our business if we don’t have the people and processes in place to make the information transparent?

Nailing strategy is the third wheel in the cycle. We have visibility, we understand the information but are we spending enough time properly strategizing? We always tell our clients and potential clients the following; “There are two critical facets to every engagement. The first is determining if there are opportunities for improvement and where they lay. The second and often more difficult facet is developing the strategy that provides the best scenario for us to execute on the opportunity.”

Executing precisely is the fourth principle. We’ve gone all the way through the process, developed a sound strategy but we ultimately failed due to poor execution. Ever heard that explanation? We see it too often – brilliant plans, just poorly executed. The timing is off, new challenges arose, we had to cut back spending and just didn’t have the resources – all are reasons for poor execution. And in many cases the reasons are valid – but successful organizations overcome these challenges. They have contingency plans in place as a result of a robust planning process!

As I mentioned earlier, the four core principles are the fundamental basics to optimize any supply chain. These principles must be a routine you live and work by and a model you use to run your business. It’s a continuous cycle, a process you need to live and breathe on a daily basis – not just once a year when budgets are due.
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