Answering these 12 questions tell more about your supply chain performance than nearly all benchmarks and audits that the market has to offer. This test should take about 5 minutes of your time.
- Can supply chain operate without Excel?
- Is ABC analysis regarded as obsolete?
- Is all relevant data documented by the supply chain teams?
- Do you record historical stock levels?
- Do supply chain teams monitor the quality of their data?
- Do you forecast lead times?
- Do you prevent any manual intervention on forecasts?
- Do you manage operational constraints, e.g. MOQs, as data?
- Do you quantify the cost of supply chain failures?
- Can decision-making systems be left unattended for a week?
- Can you recompute all decisions in one hour?
- Are all decisions prioritized against each other?
If your company isn’t answering yes to at least 10 of those questions, then, a supply chain initiative has the potential to deliver a sizeable ROI. If you don’t have 8 positive answers, ROI can be expected to be massive. If your company does not reach 6 positive answers, then, in our book, supply chain optimization hasn’t even started yet.
Read more about the Lokad test of supply chain performance.