Global Logistics and Supply Chain Strategies - September 2008 - (Page 10)

Talk It Up, Talk It Up! F or all the talk about the lack of collaboration with trading partthe story to find out what Linksys did to tear down the silo walls. We look closely into other siloed situations as well, not least of which is IBM’s effort to create its Integrated Supply Chain organization, designed to embrace all customer-facing processes as well as procurement, manufacturing and logistics. The goal was to come up with “the world’s first on-demand supply chain.” IBM also wanted to save billions of dollars by streamlining redundant processes. But neither goal could be reached without devising an organization that cut across traditional job descriptions. IBM’s holistic approach focused on the entire process, from the order desk to procurement, manufacturing, global logistics, invoicing and cash collections. No longer would a manager within one discipline be allowed to finish a task, then “throw it over the wall” to the next stage in the chain, and forget about it. In siloed organizations, one can often get away with doing just that. Collective responsibility, which is a large part of any successful silo-busting effort, can help put an end to that. I’m sure some of the situations described in our cover story may resonate with you, especially if there are still silos in your company. So I urge you to read it carefully, then talk it up. Tear down the walls! Down with silos! ners, sometimes you have to wonder if that criticism misses the mark. All too often, the real communications breakdown is not outside the four walls of the enterprise but within. You may attend a lot of meetings and teleconferences, and you may spend enough time at the water cooler that you should hang your kids’ pictures there, but are you sharing company business with colleagues in a meaningful way? By that I mean, inside your organization, is there real transfer of data and forecasts, or do most departments and divisions operate within their own spheres with inadequate input from and knowledge of the others? Functional silos, as they’re called, can be crippling. This month we examine several situations where silos undermined company goals and squandered money and opportunities. Take Linksys, for example, the division of Cisco Systems Inc. that makes routers and other networking hardware. Silos there resulted in forecast accuracy of—sit down, you’ve got to be prepared for this—20 percent! The company simply could not forecast sales with reasonable accuracy, and it could only manage supply and demand for its top 200 SKUs. The result? A huge gap between inventory levels and actual demand. By the way, it’s all better now, but you have to read Russell W. Goodman rgoodman@glscs.com 10 SEPTEMBER 2008

Table of Contents Feed for the Digital Edition of Global Logistics and Supply Chain Strategies - September 2008

Global Logistics and Supply Chain Strategies - August 2008 Contents Editorial GL&SCS Exclusive Fast Forward Up Front Cover Story: Free The Enterprise: Busting Silos in the Supply Chain Business Process Management Merits New Look fromCorporate Strategists Ships and Ports Explore Many Ways to Go Green The Right Information Should Help Avoid Any Kind of Risk Industry Voices

Global Logistics and Supply Chain Strategies - September 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.