Change Management

A Supply Network Perspectives

Initiating and leading change is an inevitable and a constant task these days. Visionary leadership with the ability to excite and unite stakeholders on why proposed change is necessary and seizing opportunities, including making dated models obsolete and developing new ways of doing business is key. A leadership capable of communicating, influencing and driving their teams towards a common vision and making change thinking contagious, embedding it into everything they do from the most fundamental daily interactions to the most complex strategy. Change agile thinking needs to be part of an organization’s and leaders’ DNA. It can’t just sit with a few people in the organization; it needs to be the way business is being done.

The Chartered Institute of Procurement and Supply defines Change management as; “a structured process to move individuals, teams and organisations from the current state to the desired state. It ensures that the identified change is carried out effectively and efficiently with stakeholder buy-in and engagement”.

“…The simple fact of the matter is; change management is your one opportunity not only to inform your associates, but to win their hearts and minds, helping them align to your vision and understand the consequences of not changing” ~ Speech by; Blaine Hurley, Senior Director — Sourcing Excellence, Global Strategic Sourcing at Whirlpool, during the Institute for Supply Management annual conference in Las Vegas.

In this article, we look at Change management, and how it can be carried out from a Supply network perspective.

Change management in a Supply network would entail; managing a transformation process to ensure that all relevant partners across the Supply network, their operational systems and processes, become in sync. This would be aimed at enhancing unity of purpose — across the board, enhancing and maintaining collaboration, systems alignment, process integration and excellence towards a shared goal.

However, for this change to be successful, it needs to be carefully guided. Without careful change management, confusion even chaos could arise, which may derail the all change efforts. When it comes to organizational change, failure continues to be more common than success. In a survey of nearly 3,000 executives about the success of their enterprise transformation efforts, McKinsey discovered the failure rate to be higher than 60%, while Harvard Business Review conducted a study that suggested more than 70% of transformation efforts fail. Part of the issue is how organizations view the human side of change, which is usually dealt with at the end of the process, when it’s really just the starting point of change. Leaders too often devote countless hours and resources to mapping out the perfect change management initiative, when in fact the one place that leaders need to start their transformational efforts is their people.

As society continuously changes, so does its constituent parts — people and industries included.

Change management should therefore seek to; inform, capacitate and enable individuals and teams to understand, embrace and rally behind the change agenda.

For instance, a similar debate is going on within the Supply Chain function. Where momentum is steadily building up on the need for updating the name, from Supply Chain to Supply Network.

In this debate, pro name-change camp argues that the name Supply Chain does not emphasize enough the need for process and systems integration hence, the silos, fragmentation and incompetence being witnessed in the global supply chain.

The camp believes that term network in Supply-network would emphasize closer collaboration, operational transparency, process visibility and end to end systems integration, which would in turn enhance excellence and competence across the network.

Be as it may, I believe this is a debate worth having.

As technology advances and global economies grow exponentially, supply chain given its strategic position, needs to play a more central role on the global business and economy. It therefore needs to transform from its usual passive execution role to a truly central position on global economic matters.

Such a change would among other benefits, help in ensuring that the global market never goes through a supply shortage crisis again as was the case with medical equipment during the initial spike in COVID-19.

And change management would assist in this important transformation.

Change management, as is the case with any transformation process, goes through different phases.

These include: -

Apprehension

For some people, change is not easy to adopt.

Despite the numerous benefits that come with progressive change, not all members of a supply network will comfortably embrace change.

At this early stage of driving change, leaders at every node or linkages of the network — and in their capacity as forces of change — will need to collaborate in assisting their respective employees to understand why change is necessary and the network in general.

Look for boundary-spanning partnerships: As work becomes more complex, it takes teams and cross-boundary collaborations to drive change and achieve results. Change-agile leaders and organizations are replacing functional silos with formal and informal organizations that allow for the rapid flow of information and decision-making.

Embracing new ways of doing things can be uncomfortable even daunting for some.

Leaders will therefore have to ensure that employee buy in -be it tentative in the beginning- exits across the network.

In seeking buy-in, it is reassuring, if leaders can communicate, inform and educate all relevant entities on the purpose and benefits they stand to directly enjoy from the proposed transformation.

Purpose is the guardrail for actions. Change agility requires an answer to the question “Why?”, so that people can fight the natural instinct to resisting change. The answer needs to tap into what’s meaningful and important, providing an irresistible invitation to come along.

Resistance:

It is human nature to reject the unfamiliar and stick to the status quo.

At this phase of managing change, the common statement of; “we have always done it this way without any problem”, will usually creep up.

It is in most cases hard for employees to be told that their way of doing things is outdated and in need of transformation. But this is the type of frankness needed if supply networks are to be agile, resilient, more responsive to the demand in the market.

Managers should anticipate resistance and pull backs during change management, and they should exercise patience by among other things; implementing the change in small but progressive bits.

Empathy should be exercised and assistance provided to those may struggling to cope with change, while making them understand why the current approach is a drag on the required competitive advantage of the supply network as a whole.

Exploration stage:

Seeing is believing.

At this phase of change management, partners are in the trial mood, still exploring if the changes being implemented will indeed yield desired results.

In dealing with the doubt and confusion which may present at this stage, it is advisable that managers set short term goals or milestones to be achieved.

Because it is through small or gradual successes, that doubting parties will be convinced and therefore rally behind the transformation initiative.

Commitment Stage:

Having experienced (and enjoyed) small gains, and believed that the transformation can deliver better results, network partners are now ready to fully commit to the change agenda.

At this phase, partners are ready and willing to internalize new systems and processes.

It is at the commitment stage where strategic collaboration between supply network partners is more closer, processes more visible and systems integration more stronger, towards a shared vision.

For change to gain traction and last, leaders across the board, will need to closely collaborate and be clear on: -

● The purpose/vision.

● Clear steps (the scope) in achieving the goal.

● Success milestones or key performance indicators.

Communication, preferably real-time should be in place for instantaneous actions across the board.

Likewise, employees across the network, will have to get the necessary support and motivation, if they are to successfully get the transformation agenda embedded within the network systems.

Varying opinions are good for debating issues and consensus building.

As such, managers should make it possible for stakeholders to express their views, engage and be able to convince everyone as to why change is necessary.

Periodical analysis and analytical reviews of a transformed process should be conducted to determine and ensure that change management is delivering expected results — way into the future.

As transformation takes shape, it is important small but steady wins get recognized and celebrated. Generating Short term wins are proof of progress, motivators, which must be recognized, collected and communicated. Nothing breeds success like success. Tell the stories at company events and recognize middle and front-line leaders who are looking ahead and identifying opportunities. Show that the status quo is not enough anymore. Gauging progress, consolidating and steadily building on the gains, is key to change management.

There are many changes a supply network can adopt, digital technology systems being of the popular ones.

These may include; Procure To Pay (P2P), automated inventory and analytical systems like Artificial Intelligence (AI) and Blockchain.

Fact is, people are generally not averse to transformation. They resist change that takes them by surprise i.e. without their knowledge, readiness or input.

It is vital that stakeholders are engaged beforehand, on any pending changes.

Trepidation and sense discomfort are part of any major change process.

As such, systems should be in place to accommodate and calm those who may present out of place symptoms — across the network.

Driving change requires closer collaboration, transparency and honesty — among stakeholders.

And unless and until leadership believes and buys-in to the change agenda, change management will not yield the required results.

A leader’s job in this case, does not only end at accepting change, but managing and ensuring that change is institutionalized within and internalized among all supply network partners.

For change to be transformative and lasting, necessary infrastructure and support systems must be available, and to be fully embraced, change must be understood.

It is vital therefore that communication about change and its benefits to individuals and supply network as a whole, is as simple, clear as it is straight to the point and constant.

In all, change must be embedded in to both employees’ psyche and operational culture.

Failing which it would be fleeting hence, temporary.