Art van Bodegraven, a retired supple chain practitioner who now consults because he clearly could not sit still, gave a truly wonderful, witty and nuanced presentation on the state of supply chain and supplier relationships today at Elemica Reveal. While I can’t do his keynote justice in a quick write-up, I’ll share a few items that really stood out.
In no particular order:
- A great quote from Derek Leathers, COO of Werner Transportation: “We are reserving capacity for customers who treated us right.” Art came back to this concept again and again and the importance of relationships — not just building them but sustaining them in the supply chain.
- Historical supply chain parallels: Art notes “in a world of relationships we have some interesting models in history (such as Frances Estate General, English Parliament, etc.) that show “the pecking order in supply chain.” At the top, we have the clergy (academia). Next we have the “second” class or the nobility (consultants, software developers). The third class are the commoners (i.e., practitioners). Then we enter “untouchable” territory with trade press and such (I almost laughed out loud when he said this). As for procurement, I’d disagree with him (regarding academia) unfortunately — we need stronger academic leadership just like supply chain.
- Some other one-liners from Art: “We have multiple supply chains … there is not one supply chain” and we should never think of it as such — or study it as such. But “supply chains do compete against other supply chains” and we should not forget that fact. And poor supply chains (relatively speaking) compared to others such as those of Circuit City (compared to Best Buy) and the Big Box stores are a great example.
- On inventory: “The real nature of what we’re about is not about cutting inventory, but right-sizing inventory — sometimes it’s having more inventory” that is the right strategy.
- In terms of deciding what to focus on the supply chain, go beyond just the basics (and cutting inventory at all cost). To wit, “I still pick up pennies of the sidewalk when I can, but sometimes I run into a lamppost because I thought I saw a $5 bill over there”
- Don’t take anything for granted in relationships that are even long-standing. Art gave the example of Firestone’s relationship with Ford going back to when Henry Ford and the founder of Firestone camped together and were “BFFs.” Then fast forward many decades later and when Firestone was acquired by Bridgestone and partially blamed Ford (and drivers) for the infamous Explorer rollovers, the relationship died almost overnight.
- On supply chain partnerships: “Partnership is [a] horrendously overused term … how many partnerships can you have?” What is important is "high-trust, high-communication, shared-values, open-book relationships, focusing on mutual benefit, etc.”
- In the supply chain, “trust is earned … sharing information gives you power (giving a bit of yourself away makes you stronger).”
Stay tuned for more to come from the Elemica Reveal including a look at the new Elemica platform and the “Control Towers” it is building for supply chain orchestration and visibility based on different business processes (e.g., order-to-cash, purchase-to-pay).
And if you have a chance to see or meet Art at another event, he’s a riot. His battle scars run five times deeper than almost every consultant I’ve met in the sector (and he knows how to laugh at them, too).