How many times have you heard about the perils of having siloed supply chain functions? I know we’ve written about them more than just once or twice on this very blog. And while working inside your own little box definitely isn’t ideal, it’s also not quite the all-consuming, end of the world type evil that is responsible for single handedly bringing down your entire supply chain. That’s because, in my opinion, very few supply chain practitioners actually want to work in total isolation. In many cases, they’re forced to, thanks to antiquated technology that makes company-wide alignment and collaboration more difficult than traversing Dante’s nine circles of hell.
Endless email chains, revision after revision of all those Excel spreadsheets, countless hours spent importing and exporting data to and from various enterprise resource planning (ERP) systems. You can see why comparing it to purgatory isn’t that far of a stretch. So what can these poor practitioners do? Implement a supply chain planning (SCP) system of record (SOR) of course! But what exactly is a SCP SOR apart from another in a very long line of supply chain-related acronyms?
Technology research firm Gartner Inc. defines a supply chain planning system of record as, “a planning platform that enables a company to create, manage, link, align, collaborate and share its planning data across a supply chain — from demand plan creation through the supply-side response, and from detailed operational planning through tactical-level planning.” Okay, sounds great. But what does that actually all mean, and how can something like that even be implemented?
Well, for starters, it means the beginning of the end for organizational silos. According to Gartner, one of the key tenets of a good SCP SOR is the ability to enable Stage 3 supply chain maturity, as outlined in their five-stage demand-driven maturity model. Stage 3 is characterized by the integration and synchronization of individual functions, like demand planning, supply planning, and inventory management. It also sees supply chain processes begin to align with overall business goals and metrics.
More importantly, you have to have a good SCP SOR to ever reach Stage 4 or Stage 5 supply chain maturity, which focus on collaboration and orchestration, and is where big businesses are starting to see major supply chain breakthroughs. Independent supply chain consultant Carol McIntosh wrote a blog series last year on what it takes to achieve a mature supply chain planning system of record. It includes talent, functional excellence, connecting the dots, collaborative management, and forward thinkers. Which not so coincidentally are also what’s required to make your supply chain perform more efficiently—driving improved overall business results.
To go about implementing a SCP SOR, you’re likely looking at some kind of technology solution, along with a healthy dose of change management across all levels of the company. Gartner has complied a report outlining which vendors are at the head of the class, the Magic Quadrant for Supply Chain Planning System of Record. We’ve also pulled together this handy infographic on the 5 Things to Look for in a Supply Chain Planning System of Record. So to answer my own question from the title of this blog, a supply chain planning system of record is a platform enabling you to reach higher levels of supply chain efficiency. And if you’re looking to get out of planning hell, then yes, you’ll probably need one. If not now, then definitely when your business is ready to take supply chain planning to the next level.
¹Payne, T., Magic Quadrant for Supply Chain Planning System of Record, Gartner Inc., January 19, 2016