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Simple is not easy.
Supply chain improvement projects should result in simplification. However, as we know, simplification is not easy. It requires identification of the system constraint as well as identification of the root cause through cause-effect relationships. This part of the analysis is relatively easier.
The more difficult part is identification of critical assumptions behind the root cause, as many of these assumptions are deep rooted in the organisation. We must challenge these critical assumptions and change them wherever necessary.
Breakthrough in supply chain performance comes from challenging these assumptions.
For example, if a company is struggling with poor customer service, the root cause is often identified as ‘poor forecast accuracy’. It is just one of the root causes. The real root cause may be a combination of ‘poor forecast accuracy’ and ‘dependence on forecast for supply execution’.
While the first root cause points to improvement in forecast accuracy, the second one leads to the whole new possibility of ‘Demand Driven Supply Chains’.