People, purpose and partnerships lead to performance for the best supply chain teams.
I have been positively influenced by the writings of Peter Drucker and John Wooden, and have been mentored for the last seven years by Richard Muther, “the Drucker of industrial engineering.” Also, as a member of large enterprises such as Coca Cola, PepsiCo, and Anheuser Busch InBev, I have had the opportunity to observe great leaders, to recognize what works and what doesn’t, and to build and lead supply chain teams. Based on these experiences, I believe there are three key components of a world-class supply chain team: People, Purpose, and Partnership. These three “P”components drive a fourth: Performance.
Although supply chain management is considered to be primarily about processes and technology, people and their interactions actually are more important to effective supply chain management. In a supply chain team there are two key players: the associate and the team leader.
The role of the associate is to discern: envision what to do; devise: undertake a systematic approach to identifying solutions; and decide: determine and align what is best holistically from several alternatives. The role of an associate is akin to that of an air traffic controller. He/she has to keep tabs on 50 flights in the air but, at the same time, must focus on the one key flight that requires his/her attention to safely land. While technical expertise is a vital prerequisite, it is the associate’s emotional intelligence and soft skills that create business value. Based on my experience, a successful team associate effectively displays the i14 qualities:
i. Integrity—core who you are
ii. Ingenuity—visionary who thinks beyond today
iii. Intrapreneurial—thinks like an owner and focuses on being a problem finder
iv. Intuitive—presciently attuned and flexible, anticipates needs/problems
v. Insightful—ability to identify distinct patterns logically and systematically
vi. Inspire—mobilizes/motivates others to achieve shared goals
vii. Integrative—unifies through active listening and leveraging informal relationships
viii. Intelligent—balances analytical thinking with emotional intelligence
ix. Improviser—adapts to changing circumstances and devises alternate solutions
x. Inclusive—thinks beyond him/herself and keeps everyone on the same page
xi. Influential—persuasive in aligning stakeholders at all levels
xii. Irrepressible—demonstrates exuberance and resilience, and acts with confidence and persistence
xiii. Insatiable—develops “mindware” by displaying intellectual curiosity and is a continuous learner
xiv. Impact—delivers sustainable, meaningful value to the organization
The role of the team leader is first to build the team and then establish and maintain a team culture that maximizes individual development while enabling organizational growth.
When building the team, the leader should:
- Incorporate diversity: Along with cultural diversity, team members should have differing work/life experiences (Harmony of Education, Experience, and Exposure). In addition to members with technical supply chain expertise, the leader should look to include people with liberal arts, psychology, finance, sales, and marketing backgrounds. The resulting mix of reflective thinking, action-oriented, visionary, and inclusive operators will create a balance between institutional knowledge and external, unconstrained points of view within the team. Often, great ideas for one industry are developed by adapting what has already worked for other industries.
- Hire for talent: Instead of hiring to fill a need, the leader should select for talent and compatibility with the team. Matching a specific position to a person is short-sighted. The most talented candidates, who also fit well in the team culture, will excel in the long run, despite not having the most relevant work experience.
- Position associates for success: Putting the right person in the right role is the key to building and nurturing effective teams. The leader must take an individualized approach to understanding each associate’s strengths/weaknesses and motivations in order to assign him/her the role that will maximize his/her development.
Once the team is built, the leader should ensure the proper social dynamics are present in the team through:
- Prioritizing: Effective leaders are able to identify the best course of action from a myriad of possibilities. Clearly defining responsibilities & expectations, setting goals, and measuring performance (meaningful metrics) are the means by which the leader communicates the team priorities.
- Driving performance: The leader should establish the appropriate metrics (quantitative and qualitative) to measure and reward achievements. Good leaders understand the competitive benefits of metrics on driving the right behavior. However, leaders must also foster a culture that operates with respect.
- Seeking consensus: The leader should encourage open discussion in the decision-making process. There should be an inclusive framework that allows for the consideration of both the quantitative and the qualitative perspectives. This collaborative process often has the beneficial result of converting “maybe” and “no” from reluctant associates to “yes” after they have bought into the decision.
Real-time feedback: Annual reviews are not the greatest of tools for providing feedback. The leader should use every possible occasion to provide constructive feedback to his/her associates.
- Personalized talent-building: Every individual responds differently to encouragement and criticism. When developing talent, if we understand that our own siblings have different points of view from us, then it follows that all people have different opinions. A leader should tailor his/her approach to the associate instead of using a one-size-fits-all style.
- Conscious innovation: The leader should expect and drive innovation in all of the team’s activities. The key task of the leader is to create a culture of innovation that is not just about ideation but stretches from visioning to value generation. This is a continual journey, not an event.
- Creative conflict: Establish an environment in which creative conflict is encouraged. When options are limited, it’s amazing how often creative solutions are found. The leader should not only engage constantly in “what ifs” and look to answer improbable questions; he/she should also question business assumptions.
- Accountability: Most successful leaders are those who lead by example. A good example is just as infectious as a bad example; associates are highly impressionable, particularly around strong leaders.
· Experiential learning: Every journey, however well thought through, has an element of risk. Calculated risk taking should be allowed, and capturing lessons learned to prevent future mistakes should be purposefully practiced.
The second component of building a supply chain team is Purpose. Purpose is the glue that binds associates together and drives superior performance. The Purpose must first be defined and then an environment conducive to achieving and sustaining it must be created. Once the Purpose is achieved, the culture should be redefined and adapted to a new purpose.
Defining: In most organizations, a supply chain team is considered a cost center with the primary purpose of minimizing cost by simplifying business processes. However, another less-recognized aspect of supply chain is the development of futuristic capabilities through innovation. These process and strategic innovations enable growth and should be the primary purpose of supply chain, and they are how supply chain adds value to an organization. Process innovation frees the organization from the constrained, sometimes counter-productive focus on reducing finite costs and creates possibilities for expansion. The organizations are constantly striving to transform performance. They also recognize and embrace process innovation as a journey and a worthwhile investment. The inability to focus on innovation creates an environment in which exception management, or firefighting, becomes the primary activity. The secondary purpose of supply chain should be to focus on the most important priorities that drive the business agenda. This is accomplished by asking the question, “What is that we do, today, that needs retiring, refining, or redesigning,” and identifying the key strategic priority and relentlessly focusing on it.
Achieving: Though team culture may be a soft concept, it requires disciplined effort and time to build a positive environment that encompasses organizational hierarchy, decision rights, rules of engagement, clear definitions of responsibilities and acceptable behavior, metrics, target cascading, and incentives.
A productive culture should enable associates to think and operate on a long-term basis and prevent them from falling into the mode of firefighting. The leader should endeavor to develop a culture that rewards risk taking and learning from trial and error. Consequently, rewards and recognition should be more frequent than annual incentives. The culture should be promoted throughout the organization, using banners, symbols, and recognition. Find ways to keep everyone on the same page at all times. Leverage social media to promote the culture of connectivity. I use e-notes as a way to sum up the accomplishments of a week and a month. It takes hard work to build a culture, and the culture should live on long after the leader responsible for creating it is no longer around. This is achieved by making communication the key tool.
Redefining: The Purpose is the discipline and team culture that is the means of achieving this goal. Once the purpose is achieved, the leader has to ensure that all aspects of the culture are adapted to the new reality. The most common trap teams fall into, when faced with changing circumstances, is failing to redefine the culture in line with the new requirements. This step requires the leader and the team to identify which realities and business assumptions have changed and which stage of the business journey the organization is on. This reevaluation helps define the new purpose of the organization. For example, I use supply chain maturity models to track where the organization is headed and to create a sense of journey. Secondly, every year I look at every aspect of what my team does and consciously engage in a dialogue of what to retire, refine and re-design.
The final component is partnership, which includes both intra-team and external relationships.
Internal partners: Team members should understand their strengths and weaknesses and leverage the strengths of their colleagues to further their development. It is normal to feel comfortable around people who think like us, but like-mindedness is detrimental to an effective team. It is essential that teams are composed of people with differing personalities and backgrounds who can bring multi-dimensional thought leadership. Teams also should engage in creative conflict to shape the best planning in supply chain.
Secondly, the team should practice winning together. They should perfect multidimensional thinking. I engage in a process called “Logivation,” by which I ask my teams’ direct reports to present an idea that is out of their comfort zone. I also have their teams present an idea. The outcome is that the team ideas are always much larger in scope than the individuals’ ideas. While the individual ideas force one to work sub-functionally to develop collaborative, interpersonal skills, the team ideas are mostly cross-functional in nature. It also helped me identify how people solve problems, what they gravitate to, their strengths and motivations, and, more importantly, improved the ability to create winning solutions. This practice has helped me deliver 20 times more than what was expected from us. Moreover, my team absolutely loved it.
External partners: The process applied to efficiently make and move products to create business value can also be applied to an intellectual process, which I call “Visioneering.” “Making” is really about improving the “mindware” to create robust ideas and leverage systematic processes to translate them into action plans. “Moving” is actually about persuading, influencing, and convincing the rest of the organization to go along with your plan. Therefore, leaders have to understand how to effectively collaborate, which is really listening/understanding; utilize systematic and thorough planning to think multi-dimensionally and holistically; and communicate effectively based on the needs of their audience in a customized and personalized fashion. Partnerships are built by going beyond oneself and building credibility and trust by delivering results and artfully leveraging soft skills.
Shekar Natarajan is North American Senior Director of Supply Chain Planning for Anheuser-Busch. He formerly was Director of Supply chain for the Pepsi Beverage Co., in the United States. He was the key architect and led Pepsi’s transformation program, which was recognized with the Supply Chain Innovation Award by the Council of Supply Chain Management Professionals in 2010. He is a member of the Supply & Demand Chain Executive Editorial Advisory Board.