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Time, Not Distance, Is the Problem — on Simplicity in Solutions

6 min read Bert Claesen

This is a machine-assisted translation from the original Dutch version.

Supply Chain Problems

My former colleague Ivo Bohm recently wrote a post with a great headline and a super strong insight 1. He started from a familiar problem: everything moves faster today. Demand changes more often and more unpredictably than it did ten years ago. Your job to respond to those changes has become much harder.

Many people look at the network of the supply chain when this happens: the factories or suppliers are located too far from your market. And that is often true. But even if your factories were located closer, not all problems would be solved.

Every process takes time. It is true that shipping from Asia to Belgium easily takes a month. But even when the factory sits right across the border, other processes also take time: updating the forecast, calling customers, calling suppliers, making a new production schedule. At a certain point, the distance to your factory is no longer the main problem.

At all times, time is the real problem. That is the problem Ivo correctly points out. In fancy terms, we say the Supply Chain must become responsive. Ivo was completely right about that. A classic example of responsiveness in the fashion industry is Inditex/Zara. Much has been written about their quick response (QR) model 2. Through the strength of their supply chain, they can get a new product in stores in as few as 15 days.

Supply Chain Solutions

Ivo pointed to this as an excellent use case for better analytics and scenario planning. I will not argue with that, but I want to invite you to look critically at your supply chain first.

I lean more toward simplifying and strengthening your supply chain itself. The HBR article almost literally lists the Lean solutions that Zara uses:

  • Clear communication (clear connections, like kanban systems)
  • One rhythm across the whole supply chain (takt time)
  • Investing and integrating in the right places (location and complexity of production; eliminating motion, focusing on value-add)

You cannot suddenly deliver a new item in 15 days if your factory is 30 days away, no matter how many analytics tools you buy.

The Problem with IT Solutions

Of course you must use scenario planning in your strategy. And of course you want data to be available. But that is often not your main problem. With the wrong systems, you end up with three problems instead of one:

  1. Where can my supply chain improve?
  2. Am I buying the right software package, and how do I make sure it does what it needs to do?
  3. Do I hire an in-house specialist for this package, or do I pay an outside expert?

Only one of those questions is about your core business. You can solve the other two in a hundred different ways. Besides, every analytics platform follows one rule: garbage in, garbage out. If you already have access to the right data, just use it. If you do not trust your data yet, an analytics platform makes no sense.

My tip: you can get very far with pencil, paper, and your management team. Where are the bottlenecks in your supply chain? Where does an order lose time? How can we solve the biggest problem? Value Stream Mapping helps so much more there. Build experience in improving your supply chain first. Once you have gone through this cycle five times, you can make a strategic investment in the right, simple tool.

You get what you pay for — cheap solutions end up costing more here too.

A Bonus Problem

Just like software that promises to solve everything, this tech focus often hides the real problems. A classic example is bringing in software bots that can do transactional human work much faster.

Imagine you have four people copying data from one Excel file to another. They do not check their inbox right away, and they are not productive during lunch either. They work "exception-driven," so they only solve process exceptions. Your people do not find this work meaningful, but the business cannot run unless these issues get fixed.

A high-priced consultant loves to tell you that you can automate this work. They say you can move your people to more "value-adding" work while the bot solves the issue.

However, you now pay a subscription fee for the software. When things go wrong, you either have to call the consultants back or train someone internally (often at a higher pay rate) to manage the bots.

The real problems never went away. Robots have their place. But use continuous improvement first to understand:

  • Why the process was built the way it was built
  • Where you can remove the root cause through root cause problem solving

Do this before you look for bots. Cheap fixes turn into expensive mistakes here as well.

Conclusion

  1. Focus on time instead of distance: it broadens your view of the supply chain and often reveals more urgent problems than where your factories are located.
  2. Work on your strategy and continuous improvement using what you already have: your brain, your team, and your data 3.
  3. Once you gain experience with the process and its problems, choose the right places to invest.

And after all that, it might just turn out that your problem really was that your factory was located too far away.

Footnotes

  1. One of the hardest problems in supply chain is not distance. ↩

  2. Harvard Business Review Rapid-Fire Fulfillment, note: paid article. ↩

  3. If your data is not good, fix that first. Not with an expensive software package, but by eliminating the root cause of the errors. ↩