Some companies have installed supply chain software and succeeded magnificently, achieving breathtaking gains in performance and profitability. Others, like Nike Corp., fail miserably, wasting hundreds of millions of dollars and actually impairing operations. What makes one company succeed and another fail? Who or what's to blame for the expensive failures?
Some point their fingers at the technology vendors. "This is what I get for our $400 million?" CEO Phil Knight of Nike Corp. asked incredulously in a published statement three years ago, after the company's supply chain software solution ran afoul of implementation problems, with unfortunate results for both operations and profitability. Experiences like Nike's produced a black eye for the vendors involved and, more importantly, for supply chain technology itself.
Technology vendors are admittedly far from perfect. But if I were a Nike shareholder, my ire would be directed not at the software vendor but at the CEO and his management team. To my way of thinking, it's their responsibility to ensure that shareholders' money is well spent, it's their responsibility to make sure that their supply chain keeps running, and it's their responsibility to satisfy customers. Applying technology to manufacturing and distribution operations may be complex and demanding, but isn't that what they're paid for?
In my experience, failures of technology initiatives can nearly always be traced to one of the following management failures:
Supply chain executives are justified in expecting help and continued support from their technology vendors. But they must never forget that they can't "pass the buck" on technology failures. The buck stops, as it should, at their desks.