The tango is a dance you would expect to see in the ballroom. But how appropriate is it to the boardroom? Well, it takes two to tango and if we are to get strategic supply chain management into the boardroom, then it is important that the parties involved are willing to work together for it to happen.

The strategic impact of supply chains is well documented and it has been emphasised that supply chains compete, not companies. If this is true then strategic competitive advantage comes from supply chains and therefore it must be represented at a strategic level. Yet many organisations miss the point of getting supply chain into the boardroom and by so doing miss huge opportunities in terms of cost reduction, quality improvement and service development, all of which have an impact on organisational success.

Let’s take a look at how some of the biggest and most successful companies rely on the supply chain for their boardroom decisions:

Doug McMillon president and CEO, Wal-Mart Stores, Inc. states “We will be the first to build a seamless customer experience at scale to save our customers not only money but also time.” A mission that can only be achieved through the strategic management of the supply chain to reduce costs and move products quickly and effectively to the customer with integrated systems between suppliers and stores.

Shell Chief Executive Officer, Ben van Beurden states ““I see important opportunities for Shell from the substantial and lasting changes underway in the energy sector underpinned by an unrelenting focus on safe and environmentally-responsible operational performance, high quality and commercial project execution and prudent financial management of the company.” A vision that relies on CSR embedded in a supply chain strategy plan that interacts with strategic projects and manages procurement costs.

CEO Matthias Müller: “The Volkswagen Group will be more focused, efficient,    innovative, customer-driven and sustainable – and systematically geared to generating    profitable growth.” Their “TOGETHER – Strategy 2025” includes the introduction of 30 new e-vehicles and new battery technology which will require close co-operation with key suppliers through strategic supply chain planning.

So how can we help other organisations to get supply chain into the boardroom?

  1. Structure. Organisations must transform from traditional hierarchical structures to synchronised proactive entities that are lean and agile with the concept of information and product flow at its heart.
  2. Culture. The cultural web needs dusting away along with the ‘spiders’ that inhabit it and be replaced by a new web of routines and symbols representing the company as a competing supply chain.
  3. Focus. Finance is represented in the boardroom because it is believed that finance controls on their own create growth and increase wealth. The reality is that the funds within a company flow from customer to supplier and the true financial representative in the boardroom is the supply chain working together with finance.

Working together we can tango, quickstep and waltz our way to organisational success but only if supply chain is dancing in the boardroom alongside all the other key participants.

If you are interested in how organisations can get supply chain into the boardroom, then our CIPS Advanced Diploma in Procurement and Supply may be of interest to you. To find out more about our CIPS qualifications, call one of our team today on 01865 404900 or email enquiries@oxfordpeg.com.