A New Approach to Sustainable Supply Chain Excellence

Achieving sustainable supply chain improvement is of the highest urgency in today’s highly competitive world, and will probably be even more so in the future. Despite the urgency, the majority of supply chain initiatives have failed to deliver expected results. This paper argues that these failures arise from two flaws: 1. The improvement initiatives have been piecemeal instead of whole-system 2. The initiatives have attended to the technology and business processes, but have ignored the human side of organizations. This paper offers an innovative approach to supply chain improvement that remedies both flaws via integration of business process, technology, and social system change. This paper presents a way to create sustainable supply chain excellence. The essential principle underlying it is both simple and profound: sustainable supply chain excellence requires getting three things right: the right business processes, the right human system, and integrating the two with the right enabling technology. Why should anyone care about creating sustainable excellence? For one thing, because many supply chain improvement projects do not live up to their promise or produce only short term results. For example, a recent survey of manufacturing companies found that less than 15 % of Supply chain software applications were successfully implemented.i For over twenty years, we have been supporting supply chain executives as they have attempted to improve the performance of their operations. Repeatedly, we have seen them fall prey to two fatally flawed approaches to performance improvement. One approach has to do with the tendency to address systemic problems in a piecemeal fashion. The most common manifestation of this tendency is to treat every operational problem as if it is a technology problem. The second faulty procedure is to ignore or overlook the human factor—what we call the social system