As we prepare for another spin around the sun, we found it fitting to reflect back on 2013 learnings, and take a glimpse at our crystal ball for the journey ahead in 2014
Takeaways – 2 short stories
Thanks to interactions with our customers, partners and other practitioners, the year was chock-a-block full of learnings. 2 highlights:
1) How does a young company know when they have entered the Operating or ‘O’-Zone? Over the last 4+ years we had the privilege of watching a company (Ruckus Wireless www.ruckuswireless.com) blossom into a significant player in a newer segment of the networking industry. As a solution provider, we have worked and thought hard about the development lifecycles of high growth, high change industries for over a decade, wondering how & when a company knows that they have come of age, or entered the critical ‘O’-Zone, as we define it. O for Operating. As defined in a previous blog (http://bit.ly/MemoToChiefExec ) young Product companies that enter the O-Zone see big changes- from shipping 10s or 100s of units a month of a handful of products, they are quickly thrust into a bigger, rapidly growing Operation – 1000s, potentially tens of 1000s of units being shipped, and this transition can be a mean one. Managing this transition requires the ambidextrous qualities of careful orchestration as well as rapid, intuitive decision-making and execution.
This year we got some great data-points. Those at the forefront of Supply and Sales Operations functions– Order Fulfillment, Supply Chain, Channel Sales managers – enjoy a key vantage point to see this transition as it unfolds. This valuable insight (that a young Product company has entered the O-Zone) if utilized in a timely manner can be harnessed for a greater Operating advantage that can be sustainable over several years.
2) Where do the Highest Impact Collaboration initiatives spring from? How? – As young companies enter the Operating Zone of their development cycle, processes and systems related to collaboration cannot be left to chance or management directives. Systematic Collaboration becomes especially critical between functions that may appear to have conflicting objectives and metrics in the near-term – for example, Sales focus on Revenue Growth and Ops on Cost Control. However, collaboration cannot be regimented through management directives. The genesis of high impact collaboration initiatives happens usually in the trenches, and its success rests exclusively on the efforts of those that get the work done. Take the case of ProductCo – a Product Company (all names changed for anonymity).
As volumes have grown quickly at ProductCo, fulfilling orders in a timely manner has become challenging for Operations. Shelley in Supply Chain Ops figures out that she ships a portion of products every week to the same Distribution partners and her colleague on the Channel Sales side – Julia – needs support. Support, so she can systematically compile sales data, interact with her Distribution partners effectively to understand downstream demand and provide quick signals back to Shelley in Ops, with all the data literally at her fingertips. Shelley (Supply Chain) runs this need by her manager, who points them to a systems vendor for brainstorming. Out of Julia (Sales) interactions with the vendor springs a collaborative system which will yield data and demand insights for the ProductCo in the near-term and on an ongoing basis. No major hullabaloo over the choice of systems, just a single-minded focus on working jointly with the vendor, across functions to improve the customer experience – through faster and accurate collaboration utilizing fresh data. All this happened because the initial thought to change came from within, was nurtured by a progressive management and collaboration culture, and effectively implemented working with a solution vendor as a partner.
Leaping forward in 2014.. and beyond
a) Collaborating systematically across functions and partners will gain traction going beyond cookie-cutter approaches : 2014 will see the onset of specialization in a critical collaboration area- Sales & Operations Planning and Execution. Dynamic companies will demand more than the cookie cutter approaches that have been offered to date. Industry specialization, smarter demand management methods, more tailored data and workflow linkages which will result in a faster and smarter collaboration between Sales, Supply Chain and their partners.
b) Leading companies and younger aspirants will refocus on profitability and away from a singular focus on Revenue growth only– Whether motivated by competition, financial valuations, cost of capital or more mundane business prudence, leading Product companies will focus back to product and operational profitability, and will be rewarded richly (http://reut.rs/1hagYpN ). Those that fall short will start seeing their valuations drop, resulting in erosion in market standing over time. Profitable Revenue growth will become the mantra of those who are at the head of the pack and intend to stay there.
c) System Implementation will capture center stage as a core success factor : As the botched rollout of the Affordable Care Act (ACA) website revealed (http://bit.ly/ObamacareIssues), bringing a website “up” is no guarantee of its success. Systems implementation requires a rich, complex set of interconnected activities to be completed in a timely and cost effective manner. This fate has also befallen many a system implementations in the private sector too. Since private companies can afford to throw a blanket of secrecy over such bungling, we hear only of the spectacular failures (http://ubm.io/JpGedn). 2014 and beyond will bring renewed focus to the arts and sciences of effective systems implementation.
Wishing you a Leap forward in 2014!!
2 thoughts on “2013 Takeaways, Forecasting the Leaps in 2014”
Hi Dr. Jain
First off, thanks a lot for your thoughtful comments.
I agree with your point about the President’s involvement as a general guideline.
However, I have a differing point of view on 2 points –
– one is the context (of the S&OP collaboration)
– two is the culture of the enterprise
As we know, most of the failed S&OP implementations fail because the ‘S’ part is missing; i.e., Sales participation is conspicuously missing.
If on the other hand, Sales & Ops are “tied at the hip” as in the case is certain Sales Channels – where selling goes hand in hand with a ‘replenishment’ type of fulfillment, in that context, such collaborative processes (S&OP and execution) is best started in the trenches.
Secondly, the culture – if the organization is reasonably ‘flat’ from a decision/ action taking standpoint, and the President regularly confers with those who work with sleeves rolled up – whether they are customer facing Sales or those that manage fulfillment, then having an S&OP or other similar collaboration initiative initiated and implemented in that context has a higher chance of success.
This is just my way of looking at it.
It is an interesting blog. I wholeheartedly agree with you that collaboration is the wave of future, and with time it will become stronger and stronger. But I feel that collaboration within an organization as well as with customers will not go too far unless there is a blessing from the top. They are the ones who control the resources. If president of a corporation attends the S&OP meeting, you can be sure that everyone else will make an effort too. Otherwise, you may hear all kinds of excuses for not attending. Plus, you won’t have the resources to get manpower and technology to support it. It is great for collaboration to originate from trenches, but, without the mandate from the top, it will sooner or later fizzle out.