CHAPTER 4

Supply Management Evolution

The path for supply chain excellence starts with supply. You cannot achieve supply chain excellence without a solid foundation of operational reliability.

—Lora Cecere

The concepts of bricks and supply are inextricably linked. Over the last three decades, the supply chain pioneers have carefully built supply processes from the inside-out. They are honed for efficiency. They are not honed outside-in. The concept of market-driven value networks is a dramatic change.

The strong vertical silos of manufacturing, distribution, and procurement formed the backbone of supply chain management. These processes are more mature than demand, and they are more insular to change. For leaders, the concepts of the market-driven value networks will be a gradual transformation: a continuation of current programs. They will slowly use digital technologies to reduce waste. Their steadfast focus will be on process innovation. They will forge new opportunities to drive value. However, for the laggards, it will not be an evolution. It will be a revolution. Table 4.1 is a holistic overview.

Table 4.1 Change Management Issues for Supply in Becoming Market Driven

From: To:
Marketing driven Market driven
Sell-in focus Sell-through focus
Inside-out flows Outside-in flows
Vertical processes Horizontal processes
The most efficient supply chain The most effective supply chain

Many will ask: “Why should supply chain processes change?” For leaders, the answers ...

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