Vision, Mission, and the Supply Chain

1. Vision, Mission, and the Supply Chain APICS Worcester County Chapter September 2012 Anthony “Z” Zampello, CPIM, CIRM, CSCP, Master Instructor: CPIM, CSCP Zampello and Associates

2. Tonight’s Agenda • Vision • Mission • Supply Chain Ground Rules SC Strategy Zampello and Associates

3. Business Vision Statement A statement that clearly defines the firm’s “reason” for being in business • Stretch • Inspire • Unite SC Strategy Zampello and Associates

4. Components of a Vision Statement • Core ideology • Core Values - timeless guiding principles • Core Purpose - reason for being • Envisioned future • Big Hairy Audacious Goals (BHAG) - clearly articulated goals • Recognition of service to stakeholders • Owners/creditors • Employees • Customers • Suppliers • Community SC Strategy Zampello and Associates

5. Mission Statements • The mission statement : • short, to the point • why the organization exists, and what it is to achieve; • States the purpose and identity of the organization; • Defines the institution's values and philosophy; and • Describes how the organization will serve those affected by its work. SC Strategy Zampello and Associates

6. Vision vs. Mission • The vision is more broad and future oriented – the goal on the horizon • The mission is more focused – how you will get to the horizon SC Strategy Zampello and Associates

7. Ben & Jerry’s Product: To make, distribute, and sell the finest quality all natural ice cream and related products in a wide variety of innovative flavors made from Vermont dairy products. Economic: To operate the Company on a sound financial basis of profitable growth, increasing value for our shareholders and creating career opportunities and financial rewards for our employees. Social: To operate the Company in a way that actively recognizes the central role that business plays in the structure of society by initiating innovative ways to improve the quality of life of a broad community: local, national, and international. SC Strategy Zampello and Associates

8. Supply Chain Management Tier 2 Customer Tier 2 Supplier Tier 1 Supplier Tier 1 Customer Nucleus Firm Material Flow Cash Flow Information Flow SC Strategy Zampello and Associates

9. Internal Supply Chain Management Vision Mission Business Plan Sales & Operations Planning Process Master Scheduling Process Material Requirements Planning Process EXECUTION AND CONTROL SC Strategy Zampello and Associates

10. 10 SCM Ground Rules • 1. Build in flexibility. • Supply chain • Move fixed to variable costs. • More flexible production methods. VELOCITY • Improved information flows. • Use subcontractors, co-packing, outsourcing. • Caveat: Do NOT chase the cheapest ! • Operations capability. • Cross training • Management’s will to change. • Continuous Improvement SC Strategy Zampello and Associates

11. 10 SCM Ground Rules - continued • 2. Plan and measure accurately. • Total cost to the full supply chain • Dashboard concept – 5 to 7 metrics in operational cost, time and response, margins, customer service. • Benchmark 1st internally, then expand SC Strategy Zampello and Associates

12. 10 SCM Ground Rules - continued • 3.Get lean by emphasizing simplicity and speed. Value Stream Map Current & Future States • Reduce uniqueness (parts, designs, suppliers, processes) and variety(transportation resources, parts suppliers). • Reduce cycle times and maximize inventory velocity. Key: information. • Understand where value is captured and eliminate non-value SC Strategy Zampello and Associates

13. 10 SCM Ground Rules - continued • 4. Optimize Information. • Focus on Time to Benefit and Decision Support. ERP? Multiple smaller systems? • Share ownership of Information throughout the full supply chain • Replace assets with Information. E.g. inventory are moved several times before reaching final destination. Replace physical movement with digital movement of customer and product information. SC Strategy Zampello and Associates

14. 10 SCM Ground Rules - continued • 5. Treat customers and suppliers unequally: Segment and Stratify. No unnecessary excellence. • 6. Practice Virtuality (partnering) and Collaborative Manufacturing/Management. • Virtuality – attempt to gain scale. • Requires more management, not less. SC Strategy Zampello and Associates

15. 10 SCM Ground Rules - continued • 7. Exploit Electronic Commerce. • Collapsing supply chain levels. E.g. distribution channel. • New channel: many-to-many. Supply Web – key customers can have communities of suppliers; collaboratively plan, forecast, replenish on a real-time(or near real-time) basis. • Valued-based differentiation – add value along product, information, process. master channel managers. SC Strategy Zampello and Associates

16. 10 SCM Ground Rules - continued • 8. Leverage People. • 9. Operationalize New Product Introductions and Phaseouts. • 10. Mass Customize and Postpone. • Commodities vs. highly customizable products. • Downstream flexibility. SC Strategy Zampello and Associates

17. Summary • Decide WHO you are • Decide WHAT you want to do • Decide HOW you’re going to do it • DO IT !!!!!!!!!!!!!!!! SC Strategy Zampello and Associates

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19. Thank you and Good Night! SC Strategy Zampello and Associates