Lack of senior leadership, company culture and poor supply chain visibility are the main barriers to strategy implementation. Failings in supply chain policy implementation can be detrimental to shareholder value and, as such, the topic should come under far greater boardroom scrutiny.
“When the process has the active support of the board, senior executive buy-in and sponsorship, there is much greater likelihood of success”, concludes the Cranfield University, UK report. A questionnaire and follow-up interviews were used to gather information for the report.
Just two per cent of supply chain strategies are implemented on time and budget, according to 181 questionnaire respondents, and 23 per cent are abandoned or have severe difficulties.
Longer, more complex supply chains, increasingly commonplace in pharma, make the process more challenging by worsening ‘the implementation gap’. This ‘gap’ occurs when timescales for implementing plans extend to the extent that the business case for change is undermined.
Barriers to success are mainly related to people, as opposed to technical issues. Respondents cited change management issues and speed of adaptation as obstacles to implementation. As such, corporate culture and executive leadership are vital to successful supply chain change.
Evidence of a shift in approach to supply chain is included in the report. The trend is, according to respondents, moving away from narrow-scope, tactical planning to a strategic, continuous process incorporating a number of divisions.
“Review of supply chain strategy is highly cross-functional, and in many cases a continuous process with regular monitoring and continuous adaptation according to circumstances”, claims the report.
Holding sales and marketing, finance and IT accountable for change increases the likelihood of success, according to the report, but these units are often only consulted on the process.