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How serious are companies on their Agile Supply Chain journey?
Of late, we have seen many companies actively working to make their supply chain more agile. While some of them proceed on this journey faster, others lag behind. What really causes this difference?
Is there a lead predictor which can tell us how easy their journey will be? Experts differ on the existence of such predictors.
My experience suggests that one such predictor is a change in KPIs monitored by the company. Agility shifts our focus. Our dependence on monthly forecasts goes down, replaced by near term demand predictions through demand sensing. We also focus more on developing stronger capabilities in flexibility and responsiveness of backend operations.
If we continue to focus on earlier KPIs like forecast accuracy and MPS adherence, it will pull us back from the agility journey. These should give way to new KPIs like response time and batch size flexibility.
If you are making your supply chain more agile, let the KPIs reflect the new focus areas. It will accelerate your journey and make the change more harmonious.