Lean Supply Management

In: Business and Management

Submitted By caliope13
Words 481
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These highest-level overarching objectives need to be distilled to real life activities and goals. The typical focus at this point becomes financially-based operational plans. Financial measures alone, however, are not sufficient to prepare the organization for the work to follow, especially keeping in mind that one of the premises of MBP is that learning from the planning and implementation process is as important as the plan itself. Focusing only on financial objectives limits the organization from making critical changes. The concept of strategic learning suggests that the companies that are the most successful in the broadest terms have mastered strategic thinking versus strategic planning.[5]
To appropriately define a balanced mix of financial and nonfinancial measures, the use of a Balanced Scorecard[6] is recommended. The Harvard Business Review describes the methods and advantages by which the balanced measures can be selected. These balanced objectives support the overarching goals arising from the MBP process. Using an MPB tool called a goals and action (G&A) matrix,[7] SCM and manufacturing operations managers can clearly articulate their objectives with reference to the overarching goals. The G&A matrix also allows the alignment of potentially conflicting objectives. For example, an SCM objective may be to reduce inbound transportation costs while a manufacturing objective may be to improve inventory turns or increase delivery frequency; the SCM goal would pursue decreased delivery frequency while the manufacturing goal would pursue increased delivery frequency. The development of the G&A goals, and the supportive reviews of the activity progress highlight such conflicts.
Formatting the strategic intent, highest-level objectives, and second-level (functional or departmental) goals are more an extension of the existing business than a change to a new…...

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