Supply Chain strategy and value chain design

The main issues observed both as consultant and as corporate leader at strategy development were:

  • Striving for too much simplicity
  • Lack of granular visibility and data
  • Too fixed definition of targets
  • Strategic focus areas are siloed or overlapping
  • Lack of value chain documentation

In general the strategy is the main direction and source of decision making and rationale behind why the company chooses to work in a way. Then strategic focus areas are there to improve the components of that strategy, if they don't work. If these don't yield value within 12 months' time, then the strategy needs to be revised as that component is not working.

What to do then?

  1. If none of the above are problems - proceed with a short few weeks to develop your strategy
  2. If any of the above are problems, you have one solution before jumping to strategizing:
  • Keep costs aligned with business revenue development
  • Work on the areas missing and identify cost optimisation opportunities (e.g. data/visibility)
  • Review your value chains against market requirements to see, if they are off (in this case, they usually are)