Enterprises typically have an executive strategic plan for growth, revenue, market share goals, and so on. Management presumes its plans will be executed. However, the reality is often quite different: the company suffers from planning troubles, missed delivery dates as well as missed strategic or tactical targets. Plans drag on or are not executed at all.
Workers “in the trenches” are so busy putting out fires that they may be completely unaware of the company’s strategic goals. Bottom line, the organization cannot achieve the agility and responsiveness it is striving for.
Why is this happening?
During our many engagements with Southern California companies over the past 25 years, the most common factors we have found are:
- Workers lack the requisite skills to do their jobs and are so busy putting out fires that they cannot make any forward progress. They may not understand the full supply chain and the importance of their specific role
- Employees’ only training has been on benefit plans, disaster procedures and harassment policies
- Older workers may not be willing to embrace change (set in their ways) and are satisfied with manual workarounds
- The organization suffers from institutional knowledge loss as aging workers leave or retire, while frustrated go-getters may move on to greener pastures
- Managers and executives may be clueless about how to affect meaningful change among their employees
According to a 2013 Accenture skills gap survey, 46% of businesses surveyed reported that their employees did not have the skills needed to allow the business to compete effectively in the coming years. Further, a 2014 Business Roundtable survey found that 52% of its member CEOs considered the skills shortage to be either “problematic” or “very problematic” in their U.S. operations.
Key contributors to this skills gap are:
- Job skills now must include an emphasis on systems and digital information. The March/April 2016 APICS Magazine article Worker Shortage or Skills Gap? states that “It is no longer enough to be physically capable of assembling parts and working with products you can see and touch. Instead, employees have to work with assets they can’t see.” (Full utilization of ERP systems is usually absent, while heavy reliance on Excel spreadsheets instead of MRP reports and outputs is common and is a strong indicators that the system is not being properly utilized).
- Recent college graduates cannot fulfill most high-level job needs because they lack general, not to mention specialized, experience
So, what do you do to make your plans a reality, to make your organization more agile and to ensure that your company has properly skilled employees?
The answer lies in looking at your workers as part of your supply chain.
Skilled Employees: A Supply Chain Management Issue
Just as balancing supply, demand and staffing, keeping inventory low and deliveries on schedule are supply chain management activities, so should be assessing and improving the competence and ability of your employees from a supply chain perspective.
The majority of our students have stated that while they really want to get things done in their company, their number one obstacle is “firefighting” – they are so busy handling emergencies that they cannot get to their actual work, let alone improvement plans and projects. These employees want to get something done but cannot.
Certain other employees we’ve interviewed simply want to put in their time, to fill the day until it’s time to clock out. If these are workers who possess a great deal of institutional knowledge, the potential exists to make them a valuable supply chain resource.
If you were to consider which of your employees to send for supply chain management training, what would be your selection parameters?
- Newer workers showing promise?
- Trusted, proven employees who should be “rewarded?”
- Employees who consistently flub and need serious help?
- Managers who do or should drive business initiatives?
- Those who request training?
- Back office roles such as inventory, planners, buyers, schedulers, inventory, logistics?
- Some other formula or method?
These may all be viable answers, but there is one additional factor to help you understand your employees both as a supply chain resource and as agents for achieving change.
There are employees in your organization who are the “go-to” people for everyone else – those who can always figure out a solution or how to get something done, whom other employees admire, respect or trust. These employees are called, variously,organizational influencers, informal influencers or organic influencers.
A March 2014 McKinsey article states:
“…informal influencers exist in every organization, across industries, cultures, and geographies. They are, simply put, people other employees look to for input, advice, or ideas about what’s really happening in a company. They therefore have an outsized influence on what employees believe about the future, as well as on morale, how hard people work, and their willingness to support—or resist—change.”
These “change leaders” may not be managers or executives at all – they may be hourly workers. McKinsey found that influencer patterns rarely follow the organizational chart, and that these influential employees “aren’t easily identified or predicted by role or tenure (although relatively few are senior company leaders, as might be expected given their formal influence).”
The McKinsey article continues:
“Moreover, we find that even when company leaders believe they know who the influencers will be, they are almost always wrong. At one large North American retailer, for instance, we compared a list of influencers that two store managers created before the [influencer-finder] survey with its actual results.
“Between them, the managers overlooked almost two-thirds of the influential employees their colleagues named; worse, both managers missed three of the top five influencers in their own stores. The retailer’s inability to recognize its influencers is no anomaly; we’ve observed a similar pattern in every other industry and geography we’ve studied.”
Who are your organizational influencers?
Keeping in mind that company leadership may be ignorant of who are their influencers, and that influencers are typically overburdened (they are the ones that can get things done and who understand the big picture), the fastest way to identify the employees who most strongly influence your organization is to conduct a simple survey within your organization. Corporate Training Institute (APICS partner) can create such a survey that you can distribute, and will tabulate the results to assist you with formulating a plan.
These staff are the ones most worth your investment.
Achieving Real Change
Organizational improvement need not be a long, drawn out process, but it cannot be achieved by pronouncements alone. And it will not last if you cannot migrate your entire organization into new habits and mindsets (commonly called cultural change).
So here we are, back at the original question: How to bridge the gap between strategy and reality?
Change in your organization is achieved in the trenches – by improving the skills and understanding of your influencers. Training key members of your staff will achieve not only rapid but lasting positive change in a short amount of time. Once these employees understand how your systems actually work and the ideal functioning of your supply chain and systems, they will have ideas for improvement and will implement those ideas, allowing you to get traction for your overall plans.
Designate 8-10 of your people, your influencers across several departments if possible, for APICS SGV supply chain management training. Back office personnel (planners, buyers, schedulers, inventory and logistics) are good candidates, but we can help you determine the most effective candidates.
With this small group we will achieve rapid and significant change. (And by the way, our client companies’ most stellar results occur when the department head or plant manager also sits in on the training, though this is not a routine occurrence.)
But will it work?
We know that a lot of training fails to achieve the desired result, and that training fads come and go. The difference with our training is application. Our students not only learn supply chain and MRP principles, but with real life examples and exercises provided by certified trainers who are themselves experienced supply chain professionals, your staff will be able to differentiate between the current operational scene and the ideal. The result is that they will see how to actually improve operations, they will be equipped and motivated to take action. And they will.
As an example, one student of ours, after completing inventory training, saved her company $75,000 in 30 days by instituting basic improvements. Here is an excerpt of another student’s success story:
“For example, we used Legos to explore the differences in a push and pull production system, how it differs from a planning perspective, in what kind of environment that manufacturing style would flourish, and if it could work for us. The tools and handouts [the instructor] supplied added to the material in a meaningful way and often linked the APICS principles with real world application. Aptly explaining how finance tracks a work order through WIP or how a poorly constructed BOM can increase lead time was all explained through diagrams, drawings, and tools provided by [instructor] Mr. Ratcliffe in a successful effort to enforce the APICS principles.”
Create positive and lasting change for your organization – contact us today.
Accenture 2013 Skills and Employment Trends Survey: Perspective on Training. Accenture.
Closing America’s Skill Gap: A Business Roundtable Vision and Action Plan. Business Roundtable.
APICS Magazine. Worker Shortage or Skills Gap? Richard E. Crandall. APICS.