Gartner’s Demand Driven Value Network (DDVN) Maturity Model has become a touchstone for companies seeking to improve their supply chain performance. At MEBC, we collaborate directly with Gartner and fully embrace this model as a blueprint for assessment and a framework for charting a path forward. As Gartner released the improved Five-Stage Model, they acknowledged that companies struggle with the ‘fundamental, cultural shift’ required to transition from an internal, functional-focus to a more holistic, external, demand-driven focus.
A broad, multi-channel DDVN assessment helps to establish the current state, but the next step can be the most difficult. While we acknowledge that the future state for every organization does not lie with every dimension in Stage 5, what IS our intended future state and how do we track our path along the way? Change must occur at many levels to transform your organization, and the breadth of the challenge can be overwhelming. How do we take our first step on this journey?
As the organization evaluates and determines how best to serve target markets, the underlying challenge is measuring progress. At MEBC we find that focusing on the Metrics Dimension enables an organization to align activities and crystallize the ideas formed during the assessment. Misalignment in the metrics strategy can cause an isolated, high visibility service failed to create the impression of broader problems, while an endemic weakness may not be apparent in the granularity of the data at specific nodes in the network. ‘Correct’ metrics will depend on the supply chain strategy and the future state organizational model.
A fully realized Performance Measurement System is the underpinning of continuous improvement not only along this Metrics dimension. It enables an organization to:
- Monitor: Track performance for reporting
- Control / Diagnose: Highlight when the supply chain operations require modification or attention
- Direct: Use of metrics to focus activities and as a foundation for personnel evaluation
The steps for implementing an effective Performance Measurement System are easy to list, yet deceptively difficult to carry out.
- Metrics Definition
- Select appropriate metrics to monitor supply chain performance
- Establish clear goals
- Data Cycles Management
- Define data required to support metrics and operational statistics
- Determine mechanisms or storing data and displaying metrics
- Performance Tracking and Root Cause Analysis
- Define process and organizational responsibility to track performance and identify points for further analysis
- Define root cause analysis / corrective action process and mechanisms
Conducting a DDVN assessment and defining a supply chain future state is a valuable, essential business exercise. The journey to that future state takes focused, Rethinking tenacious effort throughout the organization. Talk to MEBC about taking your Mission first step.