CPIM BSCM week 13

Thought for Today
TBS908 - S1’08
“You can complain because roses have thorns, or you can rejoice because thorns have roseagement
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Newmont Gold Assessment Matrix
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Newmont Gold Proposal Form
Newmont Gold Results
Streamlined operating processes Shortened replenishment lead times Reduced total inventory costs by 18%
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Innovation Strategies
Enhancing an organisation’s innovative capacity requires sustained investment, a culture of trust and collaboration Specific skills required to promote innovation include:
Company Life Cycle
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Complacency Leads to Decline
Once a company becomes complacent and vulnerable to competitive threats, it is difficult turn things around Culture and structural inertia prevent managers from adapting to evolving rules of a changing competitive game Successful companies are tempted to use scale and resources to postponed real change
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Buzz
Hybrid Innovation Strategy
Buzz Group Activity
Take 2 minutes and discuss with the people next to you what we have just covered… does it make sense to you, do you understand it?
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Innovation Strategies
“Let’s be clear on the meaning of innovation. It’s a lot more than invention. Innovation is the intersection of invention and insight. It is the fusion of new developments and new approaches… innovation is focused less on things and more on ideas, collaboration, and expertise.”
Week 13
28/May/08 Dr Peter Robertson
Collaborative Innovation
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Chapter 15: Learning Objectives
1. Explain why innovation is needed. Discuss the perils of complacency and the characteristics of learning 2. Describe two generic continuous innovation strategies, give an example of each strategy, and discuss their advantages and disadvantages 3. Identify the characteristics of an effective continuous improvement program. Describe the features of a culture of innovation
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“I absolutely, all the time, remember that complacency is the enemy of innovation.”
– Howard Stringer, Sony
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Complacency Leads to Decline
History suggests that sustaining outstanding performance beyond 15 to 20 years is rare even for the best companies Success breeds bureaucracy and complacency, creating policies and procedures that discourage innovation
High risk, high reward strategy Allows innovators to change the competitive rules
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Transformational Innovation
Incremental Innovation
Incremental innovation relies on creating a systematic capability for continuous improvement:
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Newmont Gold Approval Process
1. Every member of the group is responsible for submitting at least one “pet” idea 2. The compiled list is refined and reduced to a Top 20 list using the assessment matrix 3. Each individual selects a pet project to lead based on interest and expertise 4. Each individual enrolls team members who share an interest and passion for the project 5. The team submits a proposal with milestones, responsibilities, and a completion date 6. Proposals are reviewed by group leaders who then submit prioritised list 7. Final list is reviewed by the Materials Director to provide coordination and assure resource availability
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Complacency Leads to Decline
Continued success requires constant learning Constant learning requires companies to cultivate a culture that embraces innovation and continuous improvement
- Samuel Palmisano, CEO, IBM
Transformational Innovation
Transformational innovation relies on strategic breakthroughs in process and product technology:
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Chapter 15: Learning Objectives
4. Define collaborative, SC innovation. Identify and discuss the role, pros, and cons of diverse collaborative innovation initiatives. Explain when and why a company would employ each initiative 5. Discuss the importance of establishing the infrastructure to support long-term collaborative innovation. Explain the role of both executive governance and SC advisory councils
Communication Coaching Project Management
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Newmont Gold
Instituted program for innovation: Pet Project Program Completed projects included:
Inventory reduction through consignment Supplier reduction Alliance formation program Procurement card Supplier “report card” program Zero-based work duties Backup transportation for bulk commodities
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