"Demand Chain Management in Manufacturing and Services: Web-Based Integration, Drivers and Performance"

Markham Frohlich and Roy Westbrook

Journal of Operations Management

2002, 20, pp. 729-745

Demand Chain Management (DCM) is defined as "practice that manages and coordinates the supply-chain from end-customers backwards to suppliers...Specifically, end-customers trigger actions up the supply chain and products and services are pulled (not pushed) from one link to the next based upon demand." The article identifies four web-based demand and supply integration strategies: (a) web-based low integration; (b) web-base supply integration; (c) web-based demand integration; and (d) web-based Demand Chain Management (DCM). A survey was given to VPs of Operations or General Managers in 187 manufacturing firms and 298 service firms. These respondents rated into which of the above four categories their organization fell. They also reported performance data for their organizations. Results of the survey indicated that the manufacturing organizations that used Demand Chain Management had superior performance, with web-based low integration manufacturing organizations performing worst. The researchers only found one service company (a high-performer) using Demand Chain Management, but web-based demand integration service organizations outperformed web-based low integration service organizations. The article presents the following conclusions: "Manufacturers already pursuing the supply and demand integration strategies have the simplest next steps. Although easier said than done, these groups need to make the final leap and begin integrating the up or downstream side of their supply chains using the Internet. The low integration manufacturers and services, on the other hand, have a much harder task. They need to start implementing the web-based supply and demand integration that unlocks performance. Although this is a daunting task, the alternative of trying to compete without integration is worse since their survival may ultimately be at stake."

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"Excessive Change: Coping Mechanisms and Consequences"

I. Stensaker, C. Meyer, J. Falkenburg, and A. Haueng

Organizational Dynamics

Winter 2002, pp. 296-312

In a study involving three organizations, the authors of this article generated two defining aspects of "excessive change":

1. The organization pursues several, seemingly unrelated and sometimes conflicting changes simultaneously; and
2. The organization introduces new changes before the previous change is completed and evaluated, without allowing time for business as usual and reaping the benefits.

Organizational consequences of excessive change were identified. Structural consequences included:

1. musical chairs—this involved rotation of managers and voluntary or involuntary turnover,
2. orchestrating without a conductor—Here employees lack direction due to non-functional and inconsistent middle management; and
3. shaky foundations—This involves lack of routines and unclear responsibilities.

Consequences on performance involved implementation failure (where changes are not carried through) and loss of effectiveness (where focus on change steals attention from primary tasks and/or competencies and capabilities risk being lost because of focus on changes).

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"Leader Rebound: How Successful Managers Bounce Back from the Tests of Adversity"

Charles Stoner and John Gilligan

Business Horizons

November-December 2002, pp. 17-24

The authors of this article interviewed 35 senior executives about their experiences with adversity. Adversities fell into three general categories: business, career, and personal. The authors noted that: "First, adversities, for the most part, are unexpected. They are perceived as adversities precisely because we do not see them coming. Second, they are disruptive, twisting and thwarting the expected pattern of planned action. At least for some period, adversities generally break whatever routine executives have been able to carve. Third, a level of uncertainty and ambiguity generally surrounds adversity. The path through it is often not immediately clear."

The study indicated that leaders follow a surprisingly consistent three-stage path when confronted with the disruption of adversity:

1. the disillusionment phase—The leaders do not deny the presence and impact of their emotions, but they also understand that they cannot languish in emotional disillusionment. One of the main ways they used to work through this phase was to turn to family and friends for support. This allowed them to begin to "move on" towards overcoming the adversity;
2. the reflection phase—The leaders approached reflection from two angles. First, they spent time with themselves in introspection. Second, they sought input from trusted business colleagues and recognized experts in order to make sense out of the adversity. The four key character insights which emerge from this phase are: rediscovering significance and what really counts; reaffirming core values; understanding and accepting limits; and recognizing both what one can affect and what one is unable to control;
3. the transformation stage—This stage involves doing something different based on what has been revealed through adversity. It includes cognitive reframe (stepping back from adversity and placing it in the Big Picture perspective), challenge reframe (seeing adversity as a challenge), control reframe (realizing what they cannot control and concentrating their energies where they can have an impact), courage ("courage is an act of movement, an act of doing something different that seems to make sense"), and seeking help and support (in the forms of emotional support, diversionary support/release, and advisory support).

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"Capabilities for Managing a Portfolio of Supplier Relationships"

Stephan Wagner and Roman Boutellier

Business Horizons

November-December 2002, pp. 79-88

This article identifies five phases of managing strategic partnerships over time:

1. Prepare—This includes defining strategic and operative requirements, setting up a team, and ensuring support by top management;
2. Identify potential partners—Establish and select criteria; assign priorities; and identify potential strategic partners;
3. Evaluate and select partner—Contact potential strategic partners; Gather primary and secondary data on potential strategic partners; Evaluate potential strategic partners; Decide with team; and offer feedback;
4. Establish relationship—Document expectations; Document modalities of cooperation; and offer continuous and immediate feedback; and
5. Assess relationship—Continue relationship at existing level; Intensify relationship and solve problems; and (possibly) reduce/end relationship.

Ten guiding principles are also identified for supplier strategies:

1. Distinction—Distinguish between strategies aimed at managing the entire supplier portfolio versus individual supplier relationships;
2. Focus—Set up individual supplier strategies only for "key" suppliers based on volume and strategic importance;
3. Coordination—Coordinate the interests in the strategic partner of all internal functions throughout the process;
4. Use of information—Make the most of all available critical information at the time when supplier strategies are created;
5. Documentation—Ensure that supplier strategies are written down;
6. Communication—Communicate supplier strategies throughout the company and make them accessible in written form;
7. Use of opportunities—Constantly look for arising opportunities and feed them into the strategies;
8. Advancement—Update and revise strategies on a regular basis in order to adapt to internal and external changes;
9. Revision of assumptions—Continuously verify assumptions by checking the validity of the underlying supplier-related factors; and
10. Performance monitoring—Monitor supplier strategy implementation and assess achievement of strategic goals.

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"Models for Organizational Self-Assessment"

Matthew Ford and James Evans

Business Horizons

November-December 2002, pp. 25-32

The authors of this article state that "Self-assessment serves as an information system for managers interested in identifying and improving organizational processes." This article explores the issues involved in selecting an appropriate organizational model to match the type of self-assessment required.

For model selection, the article recommends that the organization look at five key factors. These factors, along with their related questions to ask are:

1. Conceptual domain (objective: Find a model with a conceptual domain similar to the area requiring assessment)—What area of the firm is targeted for self-assessment? What off the shelf models are available that relate to this conceptual domain? If no external models are available, can we develop an appropriate model internally?
2. Concreteness (objective: Model used for self-assessment must relate to experience and real-life events)—Does the model contain many abstract concepts? Is the language written in terms that are easily grasped by managers? Can the model be related to practical experience?
3. Diagnostic guidance (objective: The model should allow managers to understand process strengths and weaknesses and guide them towards areas that need corrective action or improvement)—Does the model allow managers to assess how well the firm is doing? Does the model provide actionable guidance on strengths and weaknesses? Can managers pinpoint processes or behaviors that require improvement based on self-assessment results?
4. Affiliation (objective: Strong affiliation lends legitimacy to the model, which will enhance the self-assessment initiative)—Do you know and respect the developer of the model? Is the model affiliated or promoted by an organization you trust or admire? Is the model internally or externally developed?
5. Validity (objective: A valid model improves the probability of accurate conclusions and effective actions stemming from the self-assessment)—Has the model been tested against existing theory, standards of measurement, and/or real life experience? Has the model been used successfully elsewhere to identify problems and improve organizational performance?

Some representative models are provided to assess each of the following: organizational performance, organizational change, culture, work systems, purchasing & supply management, and quality assurance.

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When A Thousand Words Gives You The Picture

From GP Deltapoint

Mike Bresko, Managing Director; and John McNeil, Principal Consultant

Here is an arcane little topic that will involve, interest or frustrate most of us in the coming months: “What is the best medium for me to use in communicating with others inside and outside my organization?” We all use PowerPoint and Excel to create charts, but the pervasiveness of web pages is increasing as intranets become more powerful and many organizations are using pdf files as well.

What, you may ask, does this have to do with world-class process improvement? Only this: communication on a regular basis is fundamental to all the improvement efforts we espouse, and any means of transmitting knowledge freely and efficiently is to be welcomed.

You will have noticed that we switched to a web-based format for our newsletters recently. It enables us to get our well-formatted point across easily, without subscribers having to install any software that Microsoft did not place on their computers in the first place. It is pretty universally readable and allows us a relatively high degree of formatting freedom while using a standard template each month into which we copy and paste our content.

Web content (Hypertext Markup Language or HTML) is surprisingly easy to create these days. Just save your Office file under File-Save As as a web page. Or select File-Save as Web Page directly. Voila!: your Word document, postable directly to a web site. However, you may be unhappy with the formatting constraints placed upon your document by Word; and the file you create is certainly large compared with those created by HTML editors such as the fine (and free) HTML-Kit which is available on the web (see your IT folks first; your mileage may vary). If you want to do what we have done recently and create nicely formatted color emails with graphic content, you definitely will need an HTML editor and a little patience.

And pdf? This format from Adobe is also nicely portable and the Acrobat reader is free and widely usable. If you wish to discourage others from Cut and Pasting your text, Acrobat provides various levels of password protection for your files. Also with the pdf format, what you see is what you print (Whizzywhip!) to a very large degree, and that cannot be said for web pages.

So settle on a toolkit, tell your story and send it out. Our mutual improvement is at stake!

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