Why are there Organizations that do not yet have a Supply Chain Director?

Why are there Organizations that do not yet have a Supply Chain Director? Featured Image

Author: Xabier Basañez, Managing Director LATAM, Alcott Global

Why are there organizations that do not yet have a Supply Chain Director? This question may sound strange to many of you, but still today there are companies that do not have a Supply Chain Director, which, in some way, may be leading them into the abyss.

And yes, it may sound dramatic, but sadly it is reality. Some may say: I have the function within my area of operations and thus I control what I need…. And that is where the serious mistake lies, thinking in the form of silos instead of thinking in aligned processes across all functional areas.

These last two years where we have experienced a radical change to digital and the modification of organizational processes to operate and serve a new consumer and client more efficiently, the companies that are standing out in this is because they have a leader in the area of Supply Chain (director or CSCO) fully aligned with the CEO and the rest of the functional operations of the organization.

The nature of the Supply Chain function is the integration and synchronization of the key processes of an organization, from its final consumer to the suppliers of this organization, which provide products, services, and information that give added value to its consumers, clients. and suppliers.

For this reason, when the Supply Chain Management (SCM) function is created, it is not just another silo, but a function whose duty and task is to synchronize with the rest of the functions, synchronize the processes, work longitudinally between the different functions of Operations, Sales, Marketing, Finance, Product Development, HR and Logistics to ensure that everything is perfectly linked, and for this the CEO must be an agent of change for this implementation.

And it is that absolutely ALL the processes of the organization must be synchronized under the SCM model, and I mean:

  1. Customer Relationship Management (CRM)
  2. Supplier Relationship Management (SRM)
  3. Customer Service Management (CSM)
  4. Demand Forecast Management (DFM)
  5. Order Fulfillment Management (OFM)
  6. Manufacturing Flow Management (MFM)
  7. Product Development and Commercialization (PD&CM)
  8. Returns Management (RM)

And these are the processes by which the Supply Chain Management is responsible for its synchronization, ensuring that its strategic and operational sub-processes are designed and approved for each of the 8 macro processes described above, aligning and synchronizing each one of the tasks that are carried out in each of the functions or silos of the organization, thus allowing everyone to work in alignment serving the customer and end consumer.

That is why when I say that today there are still companies thinking that the Operations or Finance Directorate controls or directs a Supply Chain Manager and his team, they are organizations that are destined to fail because they see it only as transaction elements, and these functions only ensure the operation of their respective silos.

Recently the World Global Forum published an article where they clearly expose the importance of the Supply Chain function (CSCO) and consider them the correct positions to be the new CEO of an organization.

So, if your organization does not have a Supply Chain Director aligned and working directly with the CEO and other directors of the organization, you know what you should do.

Source: Why are there Organizations that do not yet have a Supply Chain Director? by Xabier Basañez | LinkedIn

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