Global Logistics and Supply Chain Strategies - September 2008 - (Page 35)

it wants and when. For example, procurement used to be satisfied with simply getting parts to the manufacturing plant within a specified quarter, even if they arrived too late to be of use. “Now,” says Eagle, “the understanding is, if the product is not shipped out to the customer, then you’ve all failed.” Collective responsibility is a large part of any successful silo-busting effort. Under the old organization, manufacturing might have had a target of three days for making a particular product. As long as it stuck to that time frame, it considered itself compliant. But logistics might need to get its hands on the product a day earlier in order to deliver on time. In a siloed organization, manufacturing neither knows nor cares about such concerns. Change happens when managers of various functions are brought together. Eagle recalls the first official meeting of the components of the newly formed ISC. There were roughly 300 people in attendance, all grouped at tables according to their functional or regional affiliations. One year, they were no longer segregated like high-schoolers at their first dance. “That was the real cul- tural shift,” Eagle says. “People got to understand what other people did.” IBM has also done a lot of work in creating “one version of the truth”—in other words, a number on which all can agree. Forecasts used to pass through multiple levels of review, with each department contributing its own “spin,” says Payne. “By the time they got to the global consolidation level, they really wouldn’t reflect what people on the ground thought was going to happen.” Now, IBM combines insights from the sales force on the front line with those of other parts of the supply chain, including suppliers. “We have sanity checks to make sure we’re aligned with industry expectations,” Payne says. One key piece of technology in the transformation was the implementation of customer relationship management (CRM) software from Siebel Systems, Inc. (now part of Oracle Corp.). The tool told planners how close the sales force was to closing various deals, a piece of intelligence that helped in creating reliable demand forecasts. IBM also linked its enterprise resource planning sys- tem with a demand-forecasting application from i2 Technologies, in order to determine the proper inventory levels. Still, the major obstacle to silo-busting remains the human element. The goal, says Payne, is to “get [employees] to take on ownership and accountability. The key is the consistency of the message.” Easier on the Outside? Ironically, companies might find it easier to tear down functional walls separating them from external partners, such as suppliers, than those between internal departments. Independent partners understand the need to work closely together, while individuals with a common employer tend to gravitate toward their immediate areas of responsibility. “Most of the time what we hear in industry is about collaborating with vendors, suppliers and customers,” says Suresh Bharadwaj, senior principal within the consulting group of Infosys Technologies in Bangalore, India. “Rarely do we hear about internal collaboration.” Conflicting incentives are a major reason for the failure of different departments to Let us harness them for you. Your distribution facilities can actually make facilities by ProLogis give you the advantage of green design features that reduce carbon emissions. ProLogis has been at the forefront of global sustainability in industrial real estate for several years. Continuing that leadership, we are now constructing all our new facilities in the United States according to the standards set by the U.S. Green Building Council for LEED® Learn how our leadership in sustainable development can help the winds of change blow in your favor. Visit us at www.prologis.com/08. Green has always been our favorite color. Multi-level distribution facility - Amagasaki, Japan ©2008 ProLogis. All rights reserved. www.prologis.com/08 GLOBAL LOGISTICS & SUPPLY CHAIN STRATEGIES 35 http://www.prologis.com/08 http://www.prologis.com/08

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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

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