What Is Around The Next Corner For Supply Chain And Manufacturing?
It’s an allusion to Martin Brody, Chief of Police at Jaws who, upon becoming his first up-close look at the shark that he’s hunting, slowly backs into the cottage, saying “you are going to need a bigger boat.”
As an organizational leader, you’ve likely experienced several Brody Moments over the duration of your career, and you have probably got a couple more coming. In a series of interviews, we will speak to experts from a variety of fields to hear about how they’re confronting these minutes. In Part 3, we research Brody Minutes in Manufacturing and Supply Chain (M&SC) using Jon Lindekugel. He retired a year ago to become General Operating Partner/CEO at Residence at Francisco Partners Consulting, in which he implements his wealth of expertise in finance, sales, marketing, and manufacturing, in everything from industrial, consumer, and healthcare businesses to investment portfolio chances and consulting.
David and David: what’s a Brody Moment you would be prepared to share from your past?
Jon: I was a newly-minted vice president leading a health care IT business and our market was changing very fast. Our product lineup was aging and didn’t integrate well with our client workflows at the moment. Our economy was changing rapidly and our business was at risk.
I will never forget that the Brody Moment received a call from an executive at our biggest business partner, who’d only decided to go with a competitor – and had informed their customers that they might no longer use our solutions. This represented 40% of our customer base. Over fifty percent of our business was suddenly at immediate risk. We realized we had to do something fast, so we pivoted, also announced we would create the first online, artificial intelligence-driven program on the market. In the long run, we lost no business, and two years later had more than $100 million in an expansion driven by the new application.
What’s funny is that this triggered another Brody Moment. This considerable growth outstripped our deployment capacity – we’d approximately five times new deployments than we had been staffed to provide. Once again, we had to regroup. We hired 250 people in three months and worked with our clients to readjust the installation program.
In both cases, unexpected outside variables interrupted our enterprise and made the Brody Moment; I suspect that’s what’s usually the source of Brody Moments. In one case it was technology, competitive, and regulatory changes that we didn’t expect. In the other instance, our own use of technology and new competitive placement led to abrupt development that out-stripped our capacity to provide for our customers.
David and David: What are the Brody Moments that other leaders at Manufacturing & Supply Chain are experiencing now? Which are the aspects that are generating those Brody Seconds?
Jon: Unforeseen external disruption is a major problem in every business. I believe it is more intense in the manufacturing sector, and notably so today. The world is more dynamic than ever before. Change is accelerating. We’re experiencing the steady parade of digital technology. Supply chain arrangements are confoundingly dependent on ecosystems that are intertwined geographically and with clients. Generally, everything is more interconnected, more connected digitally, and physically than ever before.
As an immediate outcome of all that connectedness, Brody Moments are now global in scale and scope. A natural catastrophe in one part of the world cascades and impacts things internationally. A pandemic, a strike at an integral delivery interface, tighter pollution controls in China, geopolitical events such as a trade war – any one of those will wreak havoc with all supply chains. It used to be a lot more localized, and now it just cascades across the board.
What if leaders are looking for?
These factors place a huge premium on watching around the next corner and acting on what you find in real-time, not six months later. Six months is going to be too late in almost any company, but especially in the industrial manufacturing and supply chain world.
And too late means you are going to lose business and competitions will grab your market share. If you are not ready to take care of tariffs within an importer or manufacturer, for example, and you do not adjust costs and renegotiate contracts fast enough, you’re in trouble. If you do not have the ability to dramatically boost your supply if you will need to, then you’re likely to get competitors pop up which will take share quickly. It is a race won by the team using the best line of sight.
David and David: What characterizes the new trajectory leaders at Manufacturing & Supply Chain need to move their associations to?
Jon: The external forces are not fresh, but the speed and impact of these are what’s new. Leaders must put procedures in place to be certain that the organization is looking around the next corner, doing scenario planning, and being prepared with probable solutions in advance.
It’s tempting to sit back and say “I can’t predict exactly what a politician will tweet next or what trade issues will come up.” Instead, you will need a team scouting for likely future situations. The team needs to be working together with relevant notion leaders and paying attention to exactly what the market-focused firms are calling. They need to select three to five significant external events that may arise over the next year that will have a substantial influence on your company. Then you may set out pragmatic solutions that place you to respond immediately. While the future will rarely play out exactly as predicted, you’ll discover that you got some things, some things wrong, and also that many situations will arise which are analogous to some situations. Your answer collection and scenario planning will turn out to be very helpful.
Successful scenario planning requires a digital transformation. For example, through machine learning and artificial intelligence, you’re able to closely monitor real-time commodity costs in certain markets to receive a very early warning of economic change or supply-line problems on the other side of the world that will influence you. You will need to have altered digitally to see these things occur. You need a real-time digital view of your supply chain from suppliers, through your own operations, to channel partners, and also to your end-use customers.
Jon: For non digital natives, like most companies in the manufacturing and supply chain world, digital transformation is difficult. Those people who have tried to go after it in a piecemeal fashion have attained, normally after a few years and countless dollars spent, that they’re not making enough progress. You have to completely change your talent pool and civilization by reskilling the staff you have with more electronic and analytical capabilities and bring in people from the outside as well. This has been a challenge for manufacturing and supply chain companies since they can’t easily provide compensation that is competitive with Google, for example. That’s a barrier that has to be overcome.
Past talent, you need to do four items. You want to come up with a fantastic comprehension of new digital technologies, integrate these technologies into your business processes, develop a digital view of your ecosystem, and also get very good at basic change management. All that needs powerful and visionary leadership and a different mindset. It also demands that we ask very different inquiries and optimizes around very different results than previously.
David and David: have you got any other information you can offer? Parting words?
Jon: Brody Seconds is going to take place, and you have to put processes in place to check around another corner, and the corner after that, and embrace digital transformation to improve your vision of what the future will bring. That is a tall order, but in my experience, present Manufacturing and Supply Chain teams possess more domain knowledge than anyone gives them credit for. All the electronic science in the world is just math in case you don’t have the domain expertise to give the mathematics context and meaning. The key is to effectively blend new digital analytical skills with operational domain and process expertise to provide real value.