best practices in supply chain management
TRANSCRIPT
A STUDY OF BEST PRACTICES IN SUPPLY CHAIN MANAGEMENT
by
Jay F. Chance
PAUL HARDT, Ed.D., Faculty Mentor and Chair
KEITH JOHANSEN, Ph.D., Committee Member
CLARIBEL PURCELL, Ph.D., Committee Member
Barbara Butts Williams, Ph.D , Dean, School of Education
A Dissertation Presented in Partial Fulfillment
Of the Requirements for the Degree
Doctor of Philosophy
Capella University
February 2010
UMI Number: 3390948
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Abstract
This descriptive embedded case study presents the perceptions of subject matter
experts from nine sites within a firm engaged in supply chain management activities,
describing approaches and techniques used to identify and validate best practices and to
determine to what extent practices used by the firm are “best.” No supply chain
management studies exist within the firm and academic literature does not adequately
address supply chain management and best practices. This study revealed that that the
relatively new supply chain management organization did not have a process for
identifying and validating best practices, nor were there supply chain management best
practices and therefore no ability to determine which practices were best. Results of the
study did yield several potential approaches for identifying best practices and a list of
potential best practices for the organization to consider. In addition, subject matter expert
responses and cross-case analysis yielded a validation process for classifying best
practices.
ii
Dedication
“Be still and know that I am” Psalms 46:10. These words kept me focused when
my druthers were to be somewhere else, doing something else.
I would like to make the following dedication to my family. First to my wife
Valerie, who provided support and understanding throughout the entire process, who
without a doubt was my biggest fan and cheerleader. When I was plagued with numerous
doubts, Valerie was constant. I appreciate the support from my sons, Jay Brandon,
Aubrey and Kyle, for understanding the times when I wasn’t available or constantly
seemed focused on something else. You are a wonderful wife and young men and I love
you greatly.
In addition I would like to thank and honor my father, Dr. Jay Chance. Without
your example, continued encouragement and advice, and constant reminder that this is a
degree of perseverance, I would likely not have persevered.
I would like to thank and honor my in-laws, Dean and Carol Mizer. Your
continual support, praise, and interest in the study helped keep me focused and motivated.
Finally, I would like to thank and honor my mother, Dr. Gailya Chance, I wish
you could have been here to experience this, but I know you’re watching.
iii
Acknowledgments
There are so many people that in some way contributed to the completion of this
degree and this dissertation. First, I would like to thank my mentor and committee chair,
Dr. Paul Hardt, without whose help, guidance and patience I would not have completed
this process. Thanks also belong to Dr. Keith Johansen, Dr. Claribel Purcell and Dr.
Susan Taylor, my dissertation committee who provided useful feedback and direction,
encouraging me along the way. I would also like to thank Dr. David King, who was
instrumental in helping start the dissertation process and guiding the early stages of its
creation and direction.
I would like to acknowledge Ken Shaw, the Vice President of Supply Chain
Management and the study sponsor in the subject firm who understood the benefits of the
study, allowing access to his organization and providing support and guidance along the
way.
I would also like to acknowledge Dr. Steven Carleton’s contribution. I made
some poor choices my first years in college, and if it hadn’t been for Dr. Carleton seeing
the potential beyond the present, I would not have gotten back into school to finish my
degree at that time and probably would not have tried again.
Additionally, I would like to thank Keith Castleberry and David Hill for their
support and participation as technical advisors from the firm.
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Table of Contents
Acknowledgments.................................................................................................. iii
List of Tables ........................................................................................................ vii
List of Figures ........................................................................................................ ix
CHAPTER 1. INTRODUCTION ....................................................................................... 1
Introduction to the Problem .................................................................................... 1
The Background and Significance of the Study ..................................................... 2
Statement of the Problem........................................................................................ 4
Purpose of the Study ............................................................................................... 5
Rationale ................................................................................................................. 5
Research Questions................................................................................................. 8
Theoretical Foundation ........................................................................................... 9
Definition of Key Terms....................................................................................... 15
Assumptions and Limitations ............................................................................... 16
CHAPTER 2. LITERATURE REVIEW .......................................................................... 18
Introduction to the Literature Review................................................................... 18
External Supply Chain Management Overview ................................................... 18
Supply Chain Management in the Firm................................................................ 25
External Best Practice Literature Overview ......................................................... 26
Internal Best Practice Literature Overview........................................................... 42
Synthesis of Literature Review............................................................................. 54
CHAPTER 3. RESEARCH DESIGN............................................................................... 59
v
Introduction........................................................................................................... 59
Research Purpose .................................................................................................. 59
Research Questions............................................................................................... 60
Rationale for a Case Study Research Design........................................................ 60
Overview of Research Approach .......................................................................... 61
Research Sample................................................................................................... 62
Research Design.................................................................................................... 63
Data Collection Procedures................................................................................... 65
Instrumentation ..................................................................................................... 70
Data Analysis and Synthesis................................................................................. 72
Contacting Respondents........................................................................................ 78
Organization Conducting the Study...................................................................... 79
Investigators and Technical Personnel.................................................................. 79
Ethics..................................................................................................................... 80
Timeline ................................................................................................................ 80
CHAPTER 4. RESULTS.................................................................................................. 82
Introduction........................................................................................................... 82
Study Demographics: Who Participated? ............................................................. 83
Description of the Case Study............................................................................... 86
Results of the Study ............................................................................................ 163
What the Supply Chain Management Organization IS....................................... 165
Best Practices ...................................................................................................... 168
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Conclusion of Chapter 4 Results......................................................................... 174
CHAPTER 5. RECOMMENDATIONS......................................................................... 178
Introduction......................................................................................................... 178
Value of the Study .............................................................................................. 178
Conclusions......................................................................................................... 181
Recommendations............................................................................................... 185
REFERENCES ............................................................................................................... 189
APPENDIX A. STRUCTURED INTERVIEW GUIDE................................................ 194
APPENDIX B. LETTER OF INTRODUCTION........................................................... 195
APPENDIX C. PARTIDIPANT BACKGROUND SYNTHESIS MATRIX ................ 196
APPENDIX D. INFORMED CONSENT FORM .......................................................... 197
APPENDIX E. INTERVIEW DATA ANALYSIS MATRIX ....................................... 201
APPENDIX F. POTENTIAL BEST PRACTICES IDENTIFIED AND CLASSIFIED IN SUPPLY CHAIN MANAGEMENT .................................................................. 202
vii
List of Tables
Table 1. Study Overview ......................................................................................................6
Table 2. Types of External Best Practices Studied ............................................................35
Table 3. External Best Practice Setting .............................................................................36
Table 4. Summary of Methods, Tools, and Practice External to the Defense Contractor .37
Table 5. External Best Practices Identified in the Literature Review ................................40
Table 6. SEBP Assessment Matrix .....................................................................................53
Table 7. Best Practices in the Firm ...................................................................................55
Table 8. Supply Chain Management Best Practice Baseline .............................................57
Table 9. Data Source Synthesis Matrix ..............................................................................76
Table 10. Behavioral Engineering Enabler Synthesis Matrix ...........................................77
Table 11. Embedded Unit Response Coding ......................................................................88
Table 12. BEM/C&E Example ...........................................................................................91
Table 13. Case S01 BEM/C&E for Paperless Best Practice .............................................98
Table 14. Case S01 BEM/C&E Logistics Support Analysis Enablers ...............................99
Table 15. Case S06 BEM/C&E Cross Functional Leadership Team Enablers ...............114
Table 16. Case S06 BEM/C&E Spares Checkbook Enablers ..........................................114
Table 17. Case S06BEM/C&E People Development Enablers .......................................115
Table 18. Case S06 BEM/C&E Subject Matter Expert Development& Retention Enablers
............................................................................................................................................115
Table 19. Case S09 BEM/C&E Organizational Roles in Cross-functional Setting
Enablers ............................................................................................................................116
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Table 20. Case S09 BEM/C&E Contracts Enablers ........................................................126
Table 21. Case S09 BEM/C&E Customer and Stakeholder Participation Enablers ......127
Table 22. Case S09 BEM/C&E Forecasting Enablers ....................................................127
Table 23. Case S10 BEM/C&E Forecasting Enablers ....................................................134
Table 24. Case S10 BEM/C&E Tool Tracking Enablers .................................................134
Table 25. Case S12 BEM/C&E Cell Concept Enablers ..................................................138
Table 26. Case S16 BEM/C&E Employee Involvement Enablers ...................................146
Table 27. Case S16 BEM/C&E Forecasting Enablers ....................................................146
Table 28. Case S20 BEM/C&E Performance Measures Enablers ..................................153
Table 29. Case S20 BEM/C&E Personal/Group Dynamic Enablers ..............................153
Table 30. Case S20 BEM/C&E ROIF Enablers ..............................................................154
Table 31. Case S30 BEM/C&E Modular and Scalable Enablers ....................................162
Table 32. Case S30 BEM/C&E Contracts Enablers ........................................................162
Table 33. Case S30 BEM/C&E Management by Process Enablers ................................163
Table 34. Participant’s description of the Physical Supply Chain ..................................166
Table 35. Cross Case Best Practice Enabler ...................................................................173
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List of Figures
Figure 1. SCM Embedded case study ..................................................................................8
Figure 2. Behavioral engineering model ............................................................................13
Figure 3. Self-regulating feedback model ..........................................................................27
Figure 4. Basic process model............................................................................................28
Figure 5. Process example..................................................................................................28
Figure 6. Practice example .................................................................................................29
Figure 7. Three phases of benchmarking ...........................................................................32
Figure 8. PBM Post-award follow-up. ...............................................................................42
Figure 9. Program management best practices...................................................................46
Figure 10. Systems engineering best practices...................................................................52
Figure 11. BEM Cause & effect diagram...........................................................................75
Figure 12. Research schedule ............................................................................................81
Figure 13. Participant gender ............................................................................................ 84
Figure 14. Participant education ........................................................................................84
Figure 15. Participant work background and experience ..................................................85
Figure 16. Hierarchical levels of the study participants ....................................................85
Figure 17. Participant knowledge of the subject ...............................................................86
1
CHAPTER 1. INTRODUCTION
Introduction to the Problem
Corporations in the 21st century are adjusting to the changes that occurred during
the 1980s and 1990s. These changes have contributed to a highly competitive global
economy (Ireland & Hitt, 2005). Those corporations that will survive in this globally
competitive environment are those that continue to push the boundaries of improving
performance. Identifying what is “best in class” or “process best practices” is an area of
growing interest. Corporations and organizations are not only faced with challenges of
correcting deficiencies and inefficiencies, competition is forcing firms to pursue
improved practices or lose competitive position (Blanchard, 2007).
Of specific corporate concern is the area of supply chain management which
encompasses executing the activities of design, make, deliver in producing products or
services (Hugos, 2006). In 2005, $500 billion U.S. dollars were outsourced, leading
many corporations to develop core competencies that include the ability to manage this
chain of product and or service supply (Merrifield, 2006). Companies with supply chain
disruptions experience shareholder value declines in the ranges of 51% in process, 42%
in retail and 27% in the high tech industries. Associated incomes in the large business
sector are reported to drop as much as 86% when the supply chain continues to
malfunction (Blanchard, 2007).
Best practices are viewed as a systematic approach to improving performance and
competitiveness through operating targets that are based on best practices found in the
industry (Camp 1989). Human Performance Technology (HPT) is an approach for
studying and measuring human behavior and the environmental impact on behavior
2
(Gilbert, 1996). This is contrary to popular improvement approaches and techniques
based solely on interventions of rewarding expected behavior. HPT is focused on the
human contribution to performance (Gilley & Maycunich, 2000).
The literature suggests that corporations today allocate tremendous resources in
the pursuit of improved performance, and the most popular approach to improvement is
through best practices (Jarrar & Zairi, 2000). Firms can reduce negative impacts and
improve competitive position by implementing best practices (Christmann, 2000). Best
practices that are based upon the HPT concept of systematic, results-based process
orientation and center study on the human element are seen to be most effective for
business results and most accepted by personnel (Cicerone, Sassaman, & Swinney,
2007).
The Background and Significance of the Study
Best practices have been studied over the past decade and are relevant to industry
and theory. Performance improvement has been noted among the numerous benefits of
the study of best practices (Zairi & Al-Mashari, 2005). Best practices are methods and
techniques that improve process performance and overall customer satisfaction (Damelio,
1995).
Sufficient literature exists to validate the approach as effective. This literature
spans a diverse group of activities from production to quality, diverse industries from
environmental engineering to transportation. Best practices are a well known and
frequently used approach to achieving improvement in performance (Firm internal
3
reports, 2006; Bouza, 2006; Camp, 1989; Christmann, 2000; Damelio, 1995; Hill, 2000;
Jarrar & Zairi, 2000; Lapide, 2006; Supply Chain Council, 2006)
To respond to this the need to be more competitive many corporations over the
past several decades have developed internally individuals, departments and whole
organizations to manage the performance of the supply chain. Third party studies across
various industries show that typical supply chains include “sourcing, logistics,
manufacturing, forecasting, pricing, new product launch and innovation” (Henderson,
2008, p. 22).
The study was conducted in a firm that was comprised of various competitor
companies and corporations that had been acquired over the years through mergers or
acquisitions. Each of those former corporations existed as individual sites under the
umbrella of the single corporate entity. As the firm moved toward a single unified
corporation each site continued to operate using the original practices that were
developed separately.
The Supply Chain Management (SCM) organization was relatively new as an
independent self-contained organization for the firm. As such, organizational structure
and business execution varied from site to site with no known systematic approach to
successful program execution.
The SCM organization was a consolidation of independent functions into a single
function that reduced the functional elements to the roles that included planning,
procurement, operations, logistics and material control functions. There were many
models in existence that depict various types of supply chain elements (Henderson,
2008).
4
The firm had several mature organizations that had successfully defined, deployed
and continually monitored organizational specific best practices. Best practices were
seen by the industry and recognized by the firm as a proof positive approach to ensuring
programmatic success.
The SCM organization was the subject of the study. Supply Chain Management
organizations are historically comprised of five functions; planning, supplier
management, production, inventory control, and logistics. In the firm, of these five areas,
only the Supplier Management function had previously defined governing best practices.
Supplier management and other departments and organizations that had adopted best
practices had seen performance improve and in some cases the improvements, as seen in
an increase in competitive advantage, can be directly linked to the implementation of
specific best practices (Bay, Tang, & Bennett, 2004; Butter & Linse, 2008; Drake &
Schlachter, 2007).
Statement of the Problem
Although there was a trend in industry and the firm in particular to view best
practices as the desired approach for achieving improved performance and customer
satisfaction, the firm did not have a standard approach for identifying potential internal
best practices. The several organizations that have identified specific functional best
practices used varying and non-standard approaches to identifying those best practices.
Little research on best practices specific to the firm’s newly created supply chain
management organization existed within the firm; therefore best practices had not been
5
identified for the human performance elements within the supply chain management
process in the firm.
Purpose of the Study
The goal of this research was to examine practices in supply chain management in
a real life context with specific interest in the perspective of job performers in the
functions related to supply chain management. The study identified best practices and
documented how best practices were identified and validated and to provide procedural
and policy recommendations. This was an empirical embedded case study that, through
the theoretical perspective of human performance technology described the real-world
experiences of an aerospace organization engaged in supply chain management
activities, focused on identifying supply chain management best practices and determined
to what extent practices used by the firm were best practices.
Rationale
This was an empirical embedded case study describing the real world experiences
of a firm engaged in supply chain management activities, focused on identifying supply
chain management best practices and defining what makes a best practice best. The
descriptive function is usually associated with qualitative research which makes careful
descriptions of phenomena of interest to the researcher.
A case study is empirical inquiry investigating problems as they occur in the
settings in which they occur without manipulating behavior (Yin, 2003). According to
Ellinger, Watkins, and Marsick (2005) how, what and why questions are conditions that
further justify decisions for using case studies as the research method. The researcher
6
was interested in describing how best practices are implemented and selected, what were
best practice that were in use and why they were not universally used in the firm.
The research was centered on or in a real-life setting in which the researcher has
no control, nor wants control of the job performer’s behavior. Therefore a descriptive
case study research was proposed since the research questions ask for the phenomenon of
best practice to be described in a real world setting (Gall, Gall & Borg, 2007).
Embedded case studies are single case studies that have multiple units of analysis
embedded within the bounded case. These embedded units were the individual sites and
programs that together comprise the firm (Yin, 2003). An overview of the research study
is illustrated below in Table 1.
Table 1. Study Overview Type of Study Qualitative, descriptive embedded case study
Unit of Analysis
Nine business sites and programs within the supply chain management organization of the firm.
Theoretical Framework
Economic (performance and the bottom line). Psychological (behavior as the fulcrum of performance and measurement). General systems theory (the link between goals, performance and the workforce).
Types of groups Studied
Nine supply chain departments across multiple sites and programs in the firm.
Contribution A description of the best practices used in the supply chain
management organization, how they are identified and validated.
Research Questions
RQ1) How can best practices in supply chain management be systematically identified and validated?
RQ2) To what extent are practices used by the firm in the Supply Chain Management Organization best practices?
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The case study proposed allows the researcher to review data and personnel
currently engaged in the various activities that comprise the overall supply chain
management function to distinguish best in class or “best practices” while defining how
“best practices” can be systematically identified and validated. The research process
included four phases to answer the research questions. These four phases were
establishment of a baseline, analysis of literature, analysis of exhibited behavior and a
synthesis of analysis.
Figure 1 is a representation of the research process. Graphical representations are
suggested as a more recognizable venue for staff and clients, and are prone to promote
greater recall of the topic than verbal or written descriptions (Fuller, 1999). Figure 1
shows how the study moved between the theoretical and empirical data elements
resulting in study deliverables in each phase.
Phase 1 included review of existing literature to define the specific elements
commonly associated with the supply chain, gathering existing artifacts and extant data
within the company that support these elements. A baseline of supply chain management
elements and performance was the result of analysis of this data. Phase 2 reviews the
baseline data in light of existing best in class or “best practice” literature in the field, this
review resulted in an interview protocol that guided the case study interviews. Phase 3
was the analysis of behavior which consists of conducting interviews, analysis to identify
potential best practices, the creation of observation protocol, and formal observation.
Phase 4 included data analysis and data synthesis. Data analysis included analysis of
interviews and observed behavioral data, which in turn were be analyzed using a cause–
8
and-effect diagram overlaid with Gilbert’s (1996) behavioral engineering model to
determine what behavior components and aspects were the root enablers of the “best
practice.” The final step in phase 4 is data synthesis and cross case conclusion which are
presented in the conclusion and recommendations.
Figure 1. SCM Embedded case study
Research Questions
The goal of this study was to identify similar best practices that are used across
the various operating locations in a diversified firm for supply chain management.
Contributions of this research included improving data, resources, and motivation as well
as providing a foundation for future research into causal relationships or predictive
measures and processes. The specific research questions addressed in the current study
were
9
1. How can best practices in supply chain management be systematically identified and validated?
2. To what extent are the practices used by the firm in the Supply Chain
Management Organization “best practices”? An empirical embedded case study was used to examine the research questions and to
describe the real world experiences of a diversified firm engaged in supply chain
management. The focus of the study was defining and then identifying SCM best
practices in the firm using the theoretical perspective of human performance technology.
Theoretical Foundation
The theoretical foundation of this study was based on the theory of human
performance technology and Swanson’s (2007) three elements of organizational
performances: (a) economic theory, (b) psychological theory, and (c) general systems
theory. Organizational performance and the contributing sub-elements were key
components in the improvement of SCM. The theories and each element are reviewed in
the following paragraphs.
Human Performance Technology
Use of HPT process models in changing or implementing new practices has had a
proven positive impact on business execution. When used, HPT theories and models
achieve more productive performance than other theories and models. A study conducted
at Yellow Freight Systems queried manger’s perceptions of the HPT process model
(Cicerone et al., 2007). The Yellow Freight Systems study as well as independent studies
conducted by the American Society for Training and Development (ASTD) indicates that
10
management and corporations in general view HPT concepts as best in class, so much so
that the ASTD has created a certification process targeting the HPT process approaches
(Cox, Frank, & Philibert, 2006).
HPT is a systematic approach of analyzing performance and business situations,
selecting appropriate interventions, and developing sufficient evaluations to assess and
adjust the interventions that have been chosen and executed to address performance
desires. The haphazard and piecemeal approach to problem solving, addressing
symptoms, popular in many organizations today is not sufficient to achieve the
performance improvement required (Stolovitch & Keeps, 1999).
Both Fuller’s (1999) HPT process model and Gilbert’s (1996) behavioral
engineering model (BEM) are essential to Swanson’s (2007) psychological element
described below.
Economic Theory Element
The Government and defense agencies continue to emphasize program costs as a
key driver in the decision to award contracts (King & Driessnack, 2007). In this case, a
cost to the “Buyer,” a Government agency is the price offered by the “Seller,” the firm.
The price of a product or service in simplest terms is the seller’s costs plus profit. There
is only a finite amount of profit that can be cut from out of the end price of a product or
service, the most effective approach to price reduction is reducing the seller’s costs, both
internal and external (Blanchard, 2007).
To maintain competitive advantage many organizations are improving their
supply chain management capabilities since the cost of labor is no longer a significant
factor (Bay, et al. 2004). Supply chain management development and execution are
11
integral to developing and maintaining a competitive advantage for the firm. This
competitive advantage is supported by the theory of constraints, (Bay et al. 2004; Gill,
2008; Ray, Sarkar, & Sanyal, 2008) and transactional costs theory, (Butter & Linse,
2008; Drake & Schlachter, 2007; King & Driessnack, 2007).
Swanson (2007) points out that expenditures must contribute positively to the
survival and profitability of an organization or they will not be continued. Pursuit and
implementation of best practices in SCM is seen as a cost saving choice of competitive
corporations (Zairi & Al-Mashari, 2005).
Psychological Theory Element
The psychological foundation recognizes that along with nuances in cultural
behavior, humans also broker productivity (Swanson, 2007). The underpinning
psychological theory that is foundational to the study is behavioral psychology, or
behaviorism, which is concerned with what can be seen or viewed (Swanson, 2007), and
has an emphasis on external reinforcers as a strength (Swanson & Holton III, 2001). The
research explores productivity and behavior using the theory of human performance
technology (HPT) for productivity and Gilbert’s (1996) behavioral engineering model for
behavior (Cicerone, et al., 2007).
The HPT Process Model
Experts and theorists have emulated Fuller’s (1999) 6-step model, which includes:
consideration of business needs, identifying desired performance, assessing the
performance gap, identifying the root cause, designing the implementation, and creating
measurements. Human performance technology and human performance improvement
are frequently used interchangeably (Stolovitch & Keeps, 1999).
12
The HPT process incorporates all the key elements to assess performance and
identify productivity. The following is a description of the six HPT steps.
1. Business Analysis: Ensures that the project supports the organizations mission, vision, values and goals. Projects that do not support these business factors should not be pursued.
2. Performance Analysis: Comparing the desired performance state against a baseline of current performance identifying the gap between the two.
3. Cause Analysis: Commonly referred to as a root cause analysis this is a key step in the HPT process. The cause analysis is the most frequently overlooked and misdiagnosed step in performance assessment.
4. Intervention Selection: The cause determines the intervention which in most cases is a combination of tools and approaches that are available to technologists (e.g, job aids, training, and system changes.)
5. Intervention Implementation: Putting into practice what was identified and chosen in the previous step.
6. Evaluation: Although depicted as a final step or stage in the process, measurements should be viewed as a continual process that occurs in frequent intervals during the process and post intervention implementation.
HPT approaches are “driven by a business need and a performance need and must be
justified by the results of a cause analysis” (Sanders, & Thiagarajan 2004, p. 4).
The Behavioral Engineering Model
Since the emphasis on external reinforcers’ impact on behavior is one of behaviorism’s
strengths (Swanson & Holton III, 2001) and external reinforcers of human behavior used
by organizations focus on the performance and competence variables (Cox, et al., 2006),
Gilbert’s BEM is uniquely suited in providing a link between the external and the
individual influences on behavior. The BEM has two overriding aspects – observable
behavior and the impact of the environment on observed behavior. Under these umbrella
concepts, six components of the BEM are identified: data, systems, motive, knowledge,
13
capacity, and incentive. These are reflected in and are a primary basis of the HPT
process model (Gilbert, 1996).
Gilbert (1996) states that behavior is the root of engineering improved
performance and defines behavior as having aspects of a supporting environment and a
“repertory” of behavior as well as three components classified as information, resources
and motivation. These are depicted in Figure 3.
Figure 2. Behavioral engineering model: Human Competence. Adapted from: T. F. Gilbert (1996, p. 92). Reprinted with permission of. John Wiley & Sons, Inc.
The behavioral engineering model is used to understand how performance can be
changed by altering environmental influences, specifically practices used by job
performers. Solutions to problems should match the cause of the problem (Harless,
1998). The first step in identifying what practices were best, was understanding what
environmental or individual behavioral factors enabled performance in the best practice.
14
Gilbert’s (1996) BEM model is a scientific guide to identifying the correct causes which
were essential in revealing those enablers to practices that were best in class.
Systems Theory Theoretical Element
Systems theory is both the systematic process of linking goals with the work force
and the view that all elements of a process are viewed as individually affect the
performance of the whole (Van Tiem, Moseley & Dessinger, 2001; Ruona, 2001).
Supply chain management is the approach that “deals with business process excellence
and represents a new way of managing the business and relationships with other members
of the supply chain” (Lambert, 2008, p. 2). Organizations and functions are able to
realize greater efficiencies and contribute to the firm’s competitive advantage by
adopting a systems view of the supply chain organization (Drake & Schlachter, 2007).
Although the principles of systems theory lend themselves to the concept of
supply chain management, there had been little guidance form academia which led to the
need of defining and building theory, tools and methods for successfully executing
supply chain management activities (Lambert, 2008). The study helped develop supply
chain management theory as well as identify unique and specific best practices for the
firm.
All three elements of Swanson’s theoretical foundations for performance
improvement theory were foundational underpinnings for the study. “Economics is quite
aligned with system theory in acknowledging that the ultimate purpose of the system is
survival,” (Ruona, 2001, p. 115). Ruona (2001) quotes Jaros & Dostal, (1995) that
“systems theory and psychological theory align in the belief that an organization is
composed of multi-minded individuals engaging in patterned activities” (p. 123).
15
Definition of Key Terms
Best Practices are the tactics, steps and approaches that directly influence superior
effectiveness, timeliness, cycle-time and quality (Hill, 2000).
Benchmarking is the practice of comparing competitive tactics, both internal and
external, in order to identify those tactics that lead to superior results (Camp, 1989).
Cycle-time is the measure of elapsed time between request and delivery.
Effectiveness is the measure of output that a process produces in relation to the
cost of executing the process.
Firm is the subject of the case study in which the activities of supply chain
management are being observed. Information from the firm is used with permission with
the understanding that the firm not be disclosed. Data and information from the firm is
referenced as “internal reports”
Lean is the “Removal of waste – non-value-added processes – from the business”
(Pope, 2008, p. 36).
Performance Improvement for the purposes of this study is best defined using
Gilbert’s definition of performance improvement as the science of effecting change in the
behavior and/or environment of the subjects (Gilbert, 1996).
Practice “Is a method or technique used to perform a process step” (Damelio,
1995, p. 2).
Process “is a repeatable sequence of steps used to transform and input into an
output that has value” (Damelio, 1995, p. 1).
16
Program Management Best Practices are elements that are used to provide clear
accountability which leads to timely management action to improve program
performance.
Quality is the measure of product or service conformity to requirements.
Supplier Management Best Practices are this practices that have been identified
by the firm as processes or approaches that are best in class, use and execution improves
program performance.
Supply Chain Management is the set of processes that accomplish “the delivery of
goods, services and information” (Gartner, 2000, p. 1).
Systems Engineering Best Practices are those processes and practices that have
been identified by the firm as essential to functional execution in support of
programmatic activities.
Timeliness is the measures that are associated with meeting schedule
commitments.
Assumptions and Limitations
This was a qualitative case study designed to describe the perceptions of subject
matter experts concerning supply chain management best practices. The researcher was
aware of several potential limitations in this type of study. Typical in case studies the
participants may not remain objective about their areas of expertise and therefore their
interviews may reflect bias and distortions. Since only one firm and only nine sites in
this firm were to be used as the sample, the researcher recognized that the data, findings,
recommendations and conclusions thereof may not be generalizable to all industries
17
engaged in supply chain management activities. Further, the fact that the researcher was
engaged in the supply chain management organization within the firm and supply chain
activities may have influenced the researcher’s perceptions.
In order to offset limitations, known and unknown and to increase the validity and
reliability of the study the researcher used a data triangulation approach by employing a
variety of data collection techniques. These techniques included in order of use were:
extant data review, recorded and transcribed interviews, requesting job performer
feedback, additional extant data review, analysis for discrepancies and trends, requesting
technical expert involvement and feedback, observations, keeping a research journal and
acknowledging known bias. Researcher bias was addressed through pilot-testing
instruments, technical advisor review and participation in coding processes and review of
triangulating data. Since the initial data-gathering approach used with participants were
interviews conducted by phone, nonverbal communication was nonexistent for the
interview portion of the study, adding to the possibility of miscommunication through
lack of nonverbal facial and hand expression. Rigorous review of recorded interviews
and the employ of listening and exploratory questioning techniques were used to
minimize any impact.
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CHAPTER 2. LITERATURE REVIEW
Introduction to the Literature Review
The research questions in this study were designed to identify the best practices
used in the firm’s Supply Chain Management organization and to determine how best
practices are distinguished? Within these questions, there were two concepts that needed
to be explored, to gain a full understanding of these questions, their significance, and
ways of answering each question. These concepts were reviewed both internally and
externally to the firm. These concepts were
1. Supply Chain Management (SCM)
2. Best Practice (BP) and what makes a best practice, best
Each of these elements were dealt with individually in this chapter starting with
review of the literature external to the firm, a review of literature found internal to the
firm followed by a synthesis of data, and concluding with an approach for identifying
human performance best practices in supply chain management.
External Supply Chain Management Overview
Supply chain management “represents the philosophy of managing technology
and processes in such a way that the enterprise optimizes the delivery of goods, services
and information” (Gartner, 2000, p. 1). Supply chain management has increasingly
become a strategic necessity for corporations. In recent years the validity and necessity
of a robust and effective supply chain methodology has become evident with
announcements of major schedule delays by aerospace corporations due to unknown and
unforeseen supplier and internal inefficiencies and unacceptable performance. All
19
leverage and cost gains are being lost in alternate work strategies driven by schedule
delays and the demands of customers or consideration. Interest in any and all
performance improvement techniques and methodologies to address these performance
and oversight issues are being pursued.
Background of SCM
Supply chain management has roots in the focus on lean and efficient
manufacturing. These lean efficiencies were driven by corporations initiating cost saving
changes to the business process. Supply chain management is seen as a process-driven
approach to streamlining the business (Henderson, 2008). High-tech industries
streamline by moving facilities closer to the customer, automotive manufactures
developed just-in-time delivery, while the consumer industry achieves supply chain
efficiencies through demand driven networking, (Henderson, 2008).
Pope (2008) sums up the current plight in the industry stating that,
Never before has there been a greater need to become more agile and responsive to customers that are demanding more variety and increased quality, delivered with less waste and in shorter lead times. Combine the current financial climate with the resulting uncertainty and caution that this creates in the marketplace, adding the unrelenting pressure from overseas competition. (p.36).
Understanding the market and developing the appropriate supply chain best practices
increases stability at the same time it decreases risk and associated costs. Increasingly
business is looking for “leaner” efficiencies outside of the expected manufacturing
environment. The entire business structure is under review, specifically interactions with
customers and suppliers, in short the supply chain (Pope, 2008).
20
SCM Trends
For the last three decades, supply chain related strategies have been on the
increase in aerospace corporations. While methods and procurement strategies for
outsourcing non-core competencies have increased and improved procurement strategies,
this has not been paralleled in supply chain management. Improving the performance of
the supply chain requires that the organization increase its sphere of influence over the
functions along the supply chain (Lapide, 2006).
Supply chain management has at times been referred to as “logistics”; however
there is a difference, supply chain management is those activities, departments,
organizations or firms that network together to deliver a product to market (Hugos,
2006). The challenge has been to change the perception of the people and businesses that
“deliver” product to a customer’. Supply chain is not simply one group or organization,
but the understanding that several functions, organizations and companies have to
cooperate seamlessly for the supply chain to function smoothly.
Critical Concepts in SCM
The goal of supply chain management is improving or maximizing an
organizations effectiveness, timeliness, cycle-time and quality. These overarching
measures when managed correctly contribute to a corporation’s competitive advantage
(Bay, et al., 2004; Drake & Schlachter, 2007). Each corporation’s supply chain must be
responsive and efficient as indicated by these measure (Hugos, 2006). The supply chain
typically includes the functions or organizations of: planning, supplier management,
operations, logistics and material control.
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Planning
Planning refers to the process used to organize the efforts required to complete,
supplier management, operations, logistics and material control. Hugos (2006) identifies
demand forecasting and inventory management as two efforts that are used to execute
supply chain management planning that specifically apply to the research study. The
Supply Chain Council, Inc. (2006) defined the plan portion of the supply chain process
as;
The development and establishment of courses of action over specified time periods that represented a projected appropriation of supply chain resources to meet supply chain requirements for the longest time fence constraints of supply resources. (p. 3.1.1).
Demand forecasting referred to the process where planning decisions were made
based on the quantity, period of performance, and required need date. Internal operations
are scheduled and driven by the expected/forecast need. True demand forecasting
includes all the organizations and departmental needs and resource requirements when
developing “the plan” (Hugos, 2006). Forecast planning is the science of knowing your
demand, capabilities, resources and constraints.
Hugos (2006) refers to four methods used in forecasting; qualitative, causal, time
series and simulation. Qualitative methods are subjective in nature having little or no
historical data as a basis and are therefore based on personal opinion. The causal
approach assumes that demand is related or caused by a market factor or some
environmental influence. The time series approach is based on historical demand
patterns that assume this is a valid indicator of future demand. The final forecast
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approach is simulation which combines both the time series and causal methods in an
effort to imitate consumer behavior.
Once the forecast is established, an aggregate plan is created. Aggregate plans
define how all departments and organizations will work together. Decisions to buy
(supplier management), build (operations), or pull from stock (material control) must be
made and involve the processes and constraints of each of the other function in order to
be successful.
Supplier Management
Supplier management, commonly referred to as “sourcing” by other industries, is
described as the activity of acquiring or procuring the required inputs that fulfill the
product or service need (Hugos, 2006). Supplier management takes the implied
“management” of the “supplier” of product and service, and makes it implicit; the process
of acquiring goods and services and managing the supplier providing those goods and
services.
Procurement traditionally can be divided into five categories; purchasing,
consumption management, source selection, contract negotiation and contract
management. The firm has the following four categories defining its supplier
management process; define supplier requirements, select source, negotiate and award,
and manage supplier performance. These are the major process categories that govern
the supplier management function.
The firm’s Supplier Management had a robust best practice approach that has
identified 17 Supplier Management Best Practices (SMBP), which were reviewed at each
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site on an annual basis. It was the intent of this research to accept the 17 SMBP and
address the lack of best practices in the other supply chain areas.
Operations
Operations as an organization, was responsible for producing a product. Also
referred to as production or manufacturing, the term operations encompasses and infers
the more complex nature of the organization than simply the “mechanic with a wrench.”
Operation’s primary concern was how much of what product to produce at what
timeframe and what intervals. Activities that fall within the realm of operations include
the creation of “master production schedules that take into account plan capacities,
workload balancing, quality control and equipment maintenance” (Hugos, 2006, p. 5).
Logistics
The logistics function incorporates the activities required to move inventory from
one location to another, in recent years logistics experts were required to become more
experienced with international trade and trafficking. As work became more global, the
expertise in export/import compliance and negotiating the customs process was
paramount. Logistics becomes a key partner in the planning stage and key points
throughout the supply chain process as strategies, distribution points and the chain
become more complex. This is particularly important when distribution points are
controlled by other corporations and in some cases are the subcontractors to the firm.
Material Control
Inventory management, referred to in the research study as material control, is the
set of techniques that are employed by a company to manage inventory levels and the
internal movement and control of these materials to the points where they are needed.
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The greatest impact to inventory management is demand planning. If all variables have
been accounted for accurately, then the right parts will be in the right place at the right
time. Inventory management is an ongoing process of “balancing product inventory
levels to meet demand and exploit economies of scale” (Hugos, 2006, p. 58).
Commercial/Defense Distinctions
Unlike commercial enterprises which are in the business of predicting consumer
purchasing and competing with other companies to produce similar products at lower
costs while entering the market before the competition, the defense industry builds to
contract award and not anticipation of consumer consumption. Therefore, inventory
strategies such as seasonal inventory, economic order quantity, and safety inventory are
neither cost effective nor efficient. Establishment of an aggregate plan and eliminating
the span time or waste between events under the control of inventory management
improves effectiveness and efficiency. The techniques that this industry’s inventory
management uses to improve effectiveness and efficiency are the elimination of
unnecessary warehousing by delivering to “point of use”; stocking levels at the supplier
instead of distribution centers; purchasing decisions that buy from local manufacturers,
reducing transportation time and providing ready access, and requiring that these
subcontractors kit or provide not a single element to production but a complete assembly
for quick installation.
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Supply Chain Management in the Firm
The firm’s supply chain model included all of the elements noted above and
explained below:
1. Planning–is the process that analyzes demand and supply, developing actions to meet the best procurement, production and delivery requirements.
2. Supplier Management–more commonly known as procurement, are those processes used to procure goods and services to meet planned or emergent demand.
3. Operations–specifically the roles involving producing a product whether through purchased or on-site manufactured parts to satisfy planned and emergent demands.
4. Logistics–includes delivery of product to production and/or final delivery to the customer. It also includes the return process from the customer, production, and inventory stores.
5. Material Control–includes those activities which involve storing and internal movement of parts, material and finished goods.
The research study explored these functional areas to determine how best
practices could be systematically identified and validated and what specific practices
were being used in these areas that could be described as “best practice.”
The five areas described above; planning, supplier management, operations, logistics and
material control, are described as “performance drivers that can be managed to produce
the capabilities needed for a given supply chain” (Hugos, 2006, p. 10). Key to
successfully managing these drivers is identifying and replicating successful best
practices in each of these functional areas.
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External Best Practice Literature Overview
Knowledge of what a practice is and the role practices play within a process are
required before a “best” practice can be understood and discussed. Processes govern all
types of business execution. This execution follows the same general principles of
analyzing organizations through conceptual frameworks, identifying key characteristics
of environmental influence response, the ability to self regulate through internal feedback
mechanisms, and the existence of sub-systems (Knowles, Holton III, & Swanson, 2005).
The relationship of process and practice can be described as a multi-tiered system
comprised of practices within a governing process regulated through a set of relationships
(Ruona, 2001). Study of the practices in relationship to the process and system reinforce
a more holistic world view that acknowledges that the whole is greater than the sum of its
parts (Ruona, 2001).
Best Practice Background
Bertalanffy’s (1968) concept of general systems theory is viewed as the genesis of
modern process models. Bertalanffy’s (1968) theories were developed from the study
and understanding of a number of independent theories and his ability to see the
parallelism and interrelation between them. General systems theory is the concept that
system, or processes can be defined by the relationships that exist between the individual
elements which exchange matter, or information, with their environment (Bertalanffy,
1968).
Therefore elements and processes should not be studied solely in isolation, but in
the group to better understand interactions and interrelations caused by organizations and
27
the order that unifies the elements exposing their behavior within the whole (Bertalanffy,
1968).
Bertalanffy (1968) developed the fist recognized systems model which shows
how a self-regulating system functions. This systems model includes a response driven
by a message initiated by a stimulus where the response creates feedback to the stimulus.
Figure 3. Self-regulating feedback model: General systems theory. By L. Bertalanffy (1969, p. 43). Reprinted with permission of George Braziller, Inc.
Swanson and Holton III (2001) have provided the most recognizable process
models which are associated with Bertalanffy’s (1968) basic systems theory model. The
basic process model includes the elements of (a) inputs, (b) processes, and (c) output with
a feedback loop to the other elements. This process exists and interacts with the
environment creating a “system.” Figure 4 is the basic systems or process model
(Swanson & Holton III, 2001).
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Figure 4. Basic process model: Reprinted with permission of the publisher. From Foundations of human resource development, copyright © (2001, p. 17) by R. A. Swanson & E. F. Holton III, Berrett – Koehler Publishers Inc., San Francisco, CA. All rights reserved. www.bkconnection.com
Each process may contain one or more steps or tasks that are performed to
complete that process. Practices are those internal methods that are executed to complete
a process step or task. Damelio (1995) describes a practice as how a task is performed
within the process. Figure 5 below illustrates an example of the four steps/tasks in a
shaving process; prepare area to be shaved, shave area, clean equipment, and store
equipment.
Figure 5. Process example: BASICS OF BENCHMARKING by R. Damelio. Copyright 1995 by TAYLOR & FRANCIS GROUP LLC - BOOKS. Reproduced with permission of TAYLOR & FRANCIS GROUP LLC - BOOKS in the format Dissertation via Copyright Clearance Center.
29
Figure 6 breaks down the “shave area” step from the shaving process, illustrating
how “shave area” accomplished. Three shave area “practices” are described: straight
razor, safety razor and electric razor. It is not uncommon for a process to consist of
multiple steps that in turn potentially have multiple practices. Simply put, a practices is a
sub-set activity of a process step, in essence, Damelio’s how.
Figure 6. Practice example: The basics of benchmarking. Adapted from: R. Damelio (1995). Reproduced with permission of TAYLOR & FRANCIS GROUP LLC - BOOKS in the format Dissertation via Copyright Clearance Center.
Best practices are those sub-set steps that produce superior results. The key is on
results which are the measurable points of the process. For the example above, in Figure
7, the result can be the measure of time required to execute all practices in each step in
completing the process. This is referred to as the process cycle-time, or the measure of
time used to complete a process. Cycle-time is only one of the measures that can be used
30
to judge a process, rate of errors (quality) and cost of execution are other measures that
are used (Hill, 2000).
As described in the above, it is the results and measures that are used to identify
candidates to be pursued as best practices. The best practice identification process hinges
on comparative metric analysis. Like metrics can be gathered and compared to identify
process that should be explored to understand what practice or group of practices
contribute to the superior results.
Categorizing Best Practices
Not all best practices should be judged as the same. Jarrar and Zairi (2000) have
created three best practice groupings based on their study of Chevron’s best practice
implementation program. These three groups are adapted from Jarrar and Zairi’s (2000)
publications and are as follows:
1. Unproven Practice: a practice that intuitively makes sense but has yet to be substantiated by data.
2. Good Practice: business results, technique, methodology, procedure or process that have been improved and substantiated by the data.
3. Proven Best Practice: based on analysis of the process, substantiation of performance data and widespread adoption and implementation by many organizations (Jarrar & Zairi, 2000, p. 8).
Benchmarking
Benchmarking was included in this study due to its synonymous existence with
best practice in the literature. The researcher used benchmarking as the search criteria in
order to increase the review of the best practice subject. Benchmarking has been
described as “a positive, proactive process to change operations in a structured fashion to
achieve superior performance” (Camp, 1989, p. 3). Damelio describes benchmarking as
31
“an improvement process used to discover and incorporate best practices” (1995, p. 1).
Review of the literature indicates that the majority of the descriptive text available
describes and discusses benchmarking in a proactive nature (Camp, 1989; Damelio,
1995; Kanigel, 2005), while the majority of the applied studies reviewed are reactionary
in nature (Bjornberg, 2002; Drost, Frayne, Lowe, & Geringer, 2002; Hill, 2000; Jarrar &
Zairi, 2000; Kyro, 2004; Mathaisel, Cathcart, & Comm, 2004; Williams, 2004; Zairi &
Al-Mashari, 2005; Zairi & Whymark, 2000). As Camp (1989) notes that most businesses
do not conduct benchmarking unless they are loosing competitive advantage, even though
benchmarking is referred to as an ongoing process. Benchmarking is also referred to as
best practice management (Jarrar & Zairi, 2000). Two established processes for
benchmarking found in the literature review are summarized below.
Damelio’s Benchmarking Process Basics
Robert Damelio outlines a three-phase process for benchmarking best practices:
analysis, discover and implementation. Figure 8 illustrates Damelio’s process.
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Figure 7. Three phases of benchmarking: The basics of benchmarking. Adapted from: R. Damelio (1995). Reproduced with permission of TAYLOR & FRANCIS GROUP LLC - BOOKS in the format Dissertation via Copyright Clearance Center.
Damelio (1995) makes a clear distinction between a benchmarking process and a
benchmarking system. The process is described as the steps performed to discover and
incorporate those practices identified as best in to the day-to-day operation of the
organization. A benchmarking system is the organizational infrastructure that is required
to deploy and institutionalize a benchmarking process (Damelio, 1995).
It is critical that a distinction between the two be understood. Identification and
implementation of best practices does not ensure their success, Damelio (1995) likens the
implementation of a process without a system to throwing a handful of sticks into a
stream and expecting the result to alter the course of the flow of water.
Camp’s Superior Performance Benchmarking Process
Where Damelio (1995) points out that the benchmarking process is separate and
distinct from a benchmark system, Camp combines the two for an integrated approach
that includes stakeholders and organizational structure to ensure successful and sustained
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implementation. Camp (1989) advocates using stakeholders and participants in the
process along with a robust communication process that focuses on promoting the fact
that ideas and practices implemented did not originate within the benchmarking
organization, corporation or industry, stating that adoption is more likely with this
knowledge. Camp (1989) refers to the technological breakthrough of bar coding which
was originally adopted in the grocery industry as a benchmarked process spanning almost
every industry today.
As previously noted benchmarking is intertwined with measurement. The process
is usually triggered by some sub-standard performance indicated by a measure and then
once improvement is initiated a measurement records the impact and defines the success.
The benchmarking process itself has been described as qualitative in nature, exploring the
why behind the quantitative performance metric measures (Camp, 1998).
Camp (1989) has developed a four phased approach; planning, analysis,
integration and action, which incorporate ten unique steps, noted below.
Planning phase
1. Identifying what is to be benchmarked 2. Identifying comparative companies 3. Determining data collection method and collect data
Analysis phase
4. Determine current performance gap 5. Project future performance levels
Integration phase
6. Communicate benchmark findings and gain acceptance 7. Establish functional goals
34
Action phase
8. Develop action plans 9. Implement specific actions and monitor progress 10. Recalibrate benchmarks(Camp 1989, p. 17).
Included are several steps that are not explicit or implied in other processes,
namely projection of future performance and establishment of goals. These are specific
and significant departures from other processes by implying integration into existing
systems and target performance expectations. The tenth and final step of recalibration in
the process implies a continuous improvement approach that monitors process
performance and adjust based on deviation from expected norms (Camp, 1989).
Types of Best Practices Studied
With the evolution and widespread acceptance of the best practice movement that
started in the mid 1970’s with the Xerox Corporation, the best practice philosophy has
been applied in a variety of environments and applications (Lapide, 2006). The
researcher’s review of the literature indicated that the best practice concept was universal
and not confined to a single industry or practice. The studies reviewed exposed
numerous applications of best practices in the field. Tables 2 and 3 provide a summary
of the external literature reviewed. Table 2 reports the type of best practices reviewed by
author.
35
Table 2. Types of External Best Practices Studied
Best Practices Studied Authors Training Bjornberg, 2002; Drost, et al., 2002; Kyro, 2004
Continuous Improvement Hill, 2000; Zairi and Al-Mashari, 2005; Zairi and
Whymark, 2000.
Quality Bhutta and Faizul, 1999; Devito and Morrison, 2000; Zairi and Whymark, 2000.
Business Process Lapide, 2006; Mathaisel, et al., 2004
. Implementation Christmann, 2000
Forecasting Jain, 2007.
Manufacturing Bhutta and Faizul, 1999; Hill, 2000; Jain, 2007;
Lee, Zailani, and Soh, 2006.
Settings Studied
The setting in which the studies took place is reported in Table 3. Identification of the
organization, or setting in which the study took place allowed the researcher to conclude
that best practice use was not isolated to a specific function, however the majority of the
studies reviewed did occur in manufacturing settings. Table 3 is not an exhaustive
review, but is representative of the research reviewed external to the firm.
36
Table 3. External Best Practice Setting Best Practices Setting Authors Human Resources Organization
Bjornberg, 2002; Drost, et al., 2002.
Environmental Management
Christmann, 2000
NASA/Aerospace
Devito and Morrison, 2000.
Quality Organization
Hill, 2000; Jain, 2007.
Information Technology Organization
Zairi and Al-Mashari, 2005.
Supply Chain Management
Lapide, 2006.
Manufacturing Bhutta and Faizul, 1999; Jain, 2007; Lee, Zailani, and Soh, 2006; Mathaisel, et al., 2004.
The external best practices studied and the settings in which they were studied
showed that the best practice approach was varied and widely used and were not specific
to any single setting or organization. The diversity of use indicated a general acceptance
and understanding of “best practice” which aided the researcher in obtaining stakeholders
and sponsorship, as well as cooperation from adjoining organizations and departments.
This also indicated that there is significant generalizable data about the process.
Table 4 methods, tools, and practice summary lists the studies reviewed noting the
method and tools used to gather data along with documenting the specific approaches
each study used to develop select and evaluate the best practices pursued.
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Table 4. Summary of Methods, Tools, and Practice External to the Defense Contractor
Study method developing, selecting and evaluating best practices
Research Method –
Design
Tools used to collect Data
Development Selection Evaluation Authors
Action Research
Interpretive, concept analysis, survey, interview
Identified need for scientific framework; Environmental scanning
N/A N/A Kyro, 2004
Mixed Methods
Quantitative surveys, Qualitative interviews
Developed identifying questions
Comparative analysis of performance measures
Developed measures of practice impact, measured impact on return on investment
Bjornberg, 2002
Qualitative Case Study Process focus; Identifying partners, Circulating questionnaires; analyzing best performance root cause; Gap analysis of internal performance
Comparative analysis combined with outline for developing best practices
Customer survey of performance, process performance measures
Bhutta & Hug, 1999
Qualitative Surveys N/A Process and performance focused analysis
Comparative analysis of internal resources
Christmann, 2000
Qualitative Audits, Surveys
Environmental scanning; Internal scanning of similar performance measures; Group review of applicable practices; Pilot testing; Model – Plan, Do Study, Act
N/A N/A Devito & Morrison, 2000
Qualitative Observations, Analysis, Interviews
Systems Theory grounding; Pilot test; Prototyping; Root cause of best performance; Develop Models
Analysis of Enablers; Observation; Performance analysis
N/A Lapide, 2006
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Table 4. (continued). Summary of Methods, Tools, and Practice External to the Defense Contractor
Study method developing, selecting and evaluating best practices
Research Method –
Design
Tools used to collect Data
Development Selection Evaluation
Authors
Qualitative Case Study, Review of extant data
Leadership commitment; Incentives; Training
Environmental scanning; Observation; Competitive analysis; Identification and documentation; Validation of applicability
Process performance; Audit/assessment events (routine); Assessment of implementation plan; self assessments
Zairi & Whymark, 2000
Qualitative Case Study, self completion survey, Questionnaire
Comparative analysis
Performance down select
Benchmarking as a tool to establish goals
Zairi & Mashari, 2005
Quantitative Survey of managers
Comparative analysis of performance scores for internal and external competitors
Comparative analysis of performance scores for internal and external competitors
N/A Drost, et al., 2002
Quantitative Survey instrument
Key business and process performance, Training of Sr. Mgmt in best practice processes; Development o f a BP model – Plan, Collect, Analyze, Adapt
Key business and process performance, Training of Sr. Mgmt in best practice processes; Development o f a BP model – Plan, Collect, Analyze, Adapt
N/A Hill, 2000
Quantitative Questionnaire N/A Barrier review; Comparative analysis; Review of Mgmt support
Noting that the absence of evaluation contributes to failure of implementation
Lee, Zailani, & Soh, 2006
Quantitative Extant literature review
Cataloging and documenting knowledge
Cataloging and documenting knowledge
N/A Mathaisel, et al., 2004
39
Best Practices Identified
In reviewing of the literature there were a number of best practices identified.
Table 5 lists the studies that were reviewed; benchmarking, adoption, continuous
learning, process improvement, etc. and the best practices identified for each of the
individual studies. Review of these studies revealed trends and similarities in some
“universal” best practices. These recurring themes in order of recurrence were; the need
for calculable return on monies invested in the best practice effort, both summative and
confirmative measures, senior leadership support, internal and external surveying, and
development of a best practice culture.
Although not recurring in the literature reviewed several best practices made
significant impressions on the researcher. These practices were the development of a
culture of knowledge sharing, development of systems vs. silo mentality and
communication of tacit vs. explicit information. Table 5 below shows the best practices
found in the review of literature.
40
Table 5. External Best Practices Identified in the Literature Review
Activity Best practices Author Benchmarking Senior management support and buy-in
Culture that promotes teams incorporating ideas out side of resident group
Valid business case based on ROI calculation prior to implementation
Confirmative evaluations both financial and performance in nature
Formal methodology for benchmarking Code of conduct for benchmarking organizations. (e.g.
professionalism, effectiveness, and participant protection).
Clarify objectives Understand the process in review
Zairi, Al-Mashari, 2005
Benchmarking The effort must be tied to the strategic and organizational initiatives
Involve process owners Understand your own processes Benchmark internally and externally Focus on a best practice culture Set realistic goals Develop a process for implementing findings
Hill, 2000
Adoption Employee participation Management commitment Quality department role and involvement. e.g. make it part of
the continuous improvement process
Lee, Zailani & Soh, 2006
Adoption ROI considerations Summative and Confirmative measures External analysis
Ungan, 2004
Integration Plan the study Form a benchmarking team Identify partners and stakeholders Collect and analyze information Adapt and improve
Bhutta, Hug, 1999
Benchmarking Forecasting A/B/C Segmentation or value based segmentation of the
activities, often termed as “weighted” values of each activity
80/20 rule; 20% of the activates will comprise 80% of the cost or impact, see the weighting to determine which
Sales and Operations Planning, or Supply-Demand matching; balance supply and demand over time
Demand Shaping; creating and shaping the customer short term demand based on available supply
Collaborative Forecasting and Planning; coordinating with the customer to forecast and prepare for future demand
Lapide, 2006
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Table 5. (continued). External Best Practices Identified in the Literature Review
Activity Best practices Author Continuous Learning
Common “language” and methodology Identified practice doesn't have to be “best in class”, it can
simply be “better than current.” This approach promotes continuous scanning for improvement and fosters a culture receptive to change
A process for identifying best practices A process for transfer of best practices
Zairi, Whymark, 2000
Competitiveness Top management buy-in and support Ownership of the best practice Shared cross functional understanding of the practice Standardized best practice process Organizational structure that promotes system vs. silo
thinking Culture that promotes knowledge sharing over personal
technical expertise Continual contact and information exchange Reliance on communicating tacit vs. explicit information Allotment of appropriate time to complete the task
Jarrar, Zairi, 2000
Forecasting Aligning the forecasting with the right function Forecasting activities planned in advanced Understanding how long inventory can reside in inventory;
number of days in inventory
Jain, 2007
Competitive Advantage
Resources; physical, human, and organizational Capabilities; the capacity to deploy resources Combining new applications with existing resources
(complementary assets) Complementary assets; allow firms to capture profits
associated with strategy, technology, or innovation
Christmann, 2000
Teams Potential for ROI must be established Dedicated and allotted time frames Analysis step Summative and confirmative measures A trained facilitator Continual communication
Devito, Morrison, 2000
Process Improvement
Process for analyzing the process in question; what impact on customer satisfaction, employee involvement, and financial return
Dedicated team to analyze address and implement recommended change
Clear articulation of project purpose and goal Communication plan Select the “right" tools for the project - not the available
tools Recognition for team achievements Confirmative evaluation
Dolan, 2003
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Internal Best Practice Literature Overview
Process Modeling
The firm also uses process modeling to govern and define process input, tasks,
output and flow. This approach is defined as Process Based Management (PBM) and is
the standard approach to business execution for the firm. Figure 10 illustrates a PBM
process definition for the role of a procurement follow-up coordinator, (Internal reports,
2008).
Figure 8. PBM Post-award follow-up. Adapted from Internal reports from the firm. Reprinted with permission.
43
All processes in the firm were measured by a combination of metrics. These
metrics measure in some form the process effectiveness, timeliness, cycle-time, and
quality.
Types Best Practice Studied
The firm had developed a website for some internal best practices that links
organizations desiring independent assessments of their best practice implementation to
Subject Matter Experts (SME) and on-line assessment tools. These assessments were
charted, graphed and recorded for historical review and were conducted on an
organizational level. Periodic self assessments were conducted or an organization could
be requested be a group of SME to independently review organizational performance.
There were options to differentiate between programs, but the assessment was conducted
on the overall functional organization level. The best practice assessment tool currently
recognizes, program management best practices, supplier management best practices,
systems engineering best practices, financial best practices, and lean manufacturing
(Internal reports, 2006).
Assessments were accomplished by reviewing each best practice and ascertaining
“attribute” implementation. Attributes are descriptors of activities, process, or
measurements necessary to execute a given best practice. Some organizational best
practices have designed and documented the attributes in such a manner that
implementation and progression through the attributes in sequential order can “assess”
the maturity of the best practice, and provide a specific measurable goal for progression
through the maturity levels. Attributes are both quantitative and qualitative in nature.
44
As an example, the supplier management best practice of Early Supplier and Supplier
Management Involvement (Internal reports and documents, 2006) has the following five
assessment attributes;
1. SM&P organization is actively engaged early in a gated business acquisition process. Identifying Supply Base risk, potential teammates/partners and coordinating agreements supporting early supplier involvement.
2. SM&P organization works with Supplier, Business Development and/or Sales
& Marketing to create and implement appropriate Teaming/Partnership agreements. SM&P organization is engaged to some extent in gated review activity.
3. Key Suppliers are engaged early in supporting the definition of requirements
(both technical and business) in support of Business opportunities. SM&P organization is engaged consistently in the gated review activity.
4. Key suppliers are engaged in the development and execution of new business
opportunities where appropriate, SM&P organization is engaged in all gated review activity.
5. Key Suppliers are engaged in defining and supporting the strategic campaigns
with potential customers when appropriate.
Each organization that performs supplier management was expected to execute
the best practice example above and best practice execution was assessed by the
implementation of the attributes.
Program Management Best Practices (PMBP)
Program management was described as a business within a business as the firm
produces a number of items for a variety of customers. For example the firm produces a
cargo aircraft for the Air Force. For this case the effort to design, build and deliver the
aircraft to the customer would be referred to as the Cargo Airlift Program. Program
management best practices have been identified by the company and used over the past
50 years to guide program managers in the execution of their respective programs.
45
Program Management Best Practices were designed to maximize value and ensure
performance to customer expectation, (Internal document, 2007).
There were eight program management best practices: business offers, supplier
integration, organization, create and review business plan, program execution and
control, risk – issues and opportunity management, help needed and independent reviews,
and program communication. These Program Management Best Practices are “integrated
core elements needed for leading successful business… providing clear accountability
and promoting timely management action to improve program performance” (Internal
reports, 2006) Figure 11 is an illustration of the Program Management Best Practices
and their interrelationship with each other.
46
Figure 9. Program management best practices. From internal reports. Reprinted with permission.
Each best practice has a short definition and five “key implementation attributes”
or steps outlining successful implementation approaches. An example from has been
adapted from internal reports from the firm.
Create and Review Business Plan: The Business Plan will be the constant baseline reference against which progress will be measured.
1. Assess the business environment 2. Validate strategic objectives 3. Develop and publish strategic guidelines 4. Update the long range business plan
47
5. Conduct reviews to ensure expected progress is being made The health and maturity of a program is measured by how many of the attributes
for the best practices are successfully implemented. The attributes are considered to be
progressive and as a program implements a higher level of attribute, the more mature the
program is considered.
All programs were expected to implement the eight best practices at various
attribute levels, for a program to be considered successful, it will have higher levels of
attribute implementation with a goal of level 5 across the board. The program
management department was pursuing a campaign of “strive for five”, concentrating on
achieving attribute level five in all best practices, (Internal reports, 2007).
Supplier Management Best Practices (SMBP)
Supplier management (SM) best practices were similar to PMBP in that there
were 17 supplier management best practices each having five implementation attributes,
the expectation is that the more progression the supplier management function has
through the attribute ranks the more mature the function, and the greater the potential
success in support of a program.
There were 17 SMBP, with five attributes each. The SMBP as listed and taught
by the firm’s Supplier Management University are;
1. Supplier Management Process
2. Planning
3. Early Supplier and Supplier Management Involvement
4. Common Source Selection
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5. Supplier Integrated into Decisions
6. Supplier Relationships
7. Organization Responsibility
8. Affordability and Cost Targets
9. Supplier Requirements
10. Configuration Management
11. Metrics and Performance Review
12. Integrated Schedule and Cost
13. Supplier Quality Management
14. Sub-Tier Supplier Management
15. Risk, Issues and Opportunity Management
16. Supplier Continuous Improvement
17. Communications
The attribute levels are progressive in nature and successive implementation
through the levels increases the potential for successful functional and programmatic
execution. Examples of the progressive attribute for the SMBP Supplier Management
Process are:
1. Processes are implemented in accordance with established standard practices
2. SM Leadership review SM process performance metrics
3. Self audits conducted, metrics kept, gap analysis performed and corrective actions tracked. Training plans and staffing needs based on analysis.
4. Common processes are used by the organization, unique processes reviewed
periodically.
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5. Training and staffing and process implementation plans are employed using common processes and performance benchmarking.
The SMBP differ in that best practices are sometimes grouped by category. The
best practices categories are: process, tools, implementation, cross-practice integration,
and environment. The best practice of; effective implementation of SM processes, and
common source selection, are grouped under the category of Process since these are
processes buyers use to perform those functions. Grouping best practices in to categories
facilitates ease of execution and isolation for use and improvement. Those employees
who are engaged in the development of processes and metrics would be best suited to
work best practices in the Process and Tools categories, (Internal documents, 2006).
Lean Manufacturing
Lean manufacturing was a concept that has been evolving over the past 50 years
targeting the removal of waste and non-value-added steps for business processes (Internal
document, 2008). Pope further clarifies that consideration of this approach should not be
strictly manufacturing in nature, but should extend to the entire business, covering the
supply chain from supplier to customer (2008).
Lean was comprised of the nine tactics which are the most powerful production tools
designed to achieve a “moving line” by elimination of waste. The 9-tactics as they are
referred to and described by the Firm’s Operations Council (Internal reports, 2006) are;
1. Value stream mapping and analysis
2. Balance the line
3. Standardize the work
4. Put visuals in place
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5. Point of use staging
6. Establish feeder/Supply chain lines
7. Break-through process redesign along the main line
8. Convert line to a pulse line
9. Convert to moving line
The firm’s Operations Council describes the lean manufacturing process or “the
9-tactics” as “an approach that can best be used in a manufacturing environment to
increase efficiency and the ability to manage for value” (Internal report, 2006). These 9-
tactics were developed, pilot tested and successfully executed on most of the firm’s major
airframes, both commercial and defense. The 9-tactics are production oriented but have
value and are used throughout non-production environments within the firm. It is a
requirement that all employees understand and implement the basics of lean
manufacturing in everything that they do. It is with the caveat that successful lean
manufacturing and 9-tactic plans must have the entire supply chain including the
suppliers and support groups in order to be considered efficient and successful (Internal
report, 2006).
Unlike the program and supplier management best practices, the Lean best
practices do not have progressive attributes that can be used to assess implementation
maturity. Instead descriptive attributes and detailed outcomes are provided. As an
example for value stream mapping and analysis the descriptive attributes are, set vision
for future state, define current products and services, identify which product/service are
most critical to the customer, and establish measures and targets. The expected outcomes
are establishment of a common vision and instill a drive for change, thoroughly
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understand current products and services and key process elements, and identify leverage
areas for improvements, (Internal reports, 2006).
Systems Engineering Best Practices (SEBP)
Systems Engineering is defined by the International Council on Systems
Engineering (INCOSE) as “a branch of engineering whose responsibility is creating and
executing an interdisciplinary process to ensure… quality, trustworthy, cost efficient and
schedule compliance throughout a systems entire life cycle”, (1990, p. 1). Within the
firm the Systems Engineering organization concentrates on the functional integration and
requirements in contrast to Program Management which focuses on the programmatic
components used to execute. Systems Engineering closely aligns with the theory and
practice of systems theory, the holistic, nonlinear view in which the whole is greater than
the sum of its parts.
Following this mind-set, Systems Engineering had developed its own set of best
practices that are focused on the functional aspect of program execution. There are five
Systems Engineering Best Practices: requirements analysis; functional analysis and
allocation; synthesis and integration; verification and validation; and systems analysis
and control. The interrelationship between these best practices is specific. Contrary to
the best practice integration relationship reviewed thus far Systems Engineering Best
Practices includes several validation loops. Figure 12 illustrates this interrelationship.
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Figure 10. Systems engineering best practices. From: Internal reports. Reprinted with permission.
Each Systems Engineering Best Practices has a number of attributes ranging from
one to as many as 17. All best practice attributes are grouped into five subcategories in
contrast to the other previously reviewed best practices that did not have subcategories.
These five subcategories are; process, tools, implementation, cross-practice integration,
and environment. Each subcategory has assessment attributes for each of the five best
practices. In total there are 139 assessment attributes. Table 6 shows the relationship.
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Table 6. SEBP Assessment Matrix
Components
Systems Engineering Best Practices
Pro
cess
Too
ls
Impl
emen
tatio
n
Cro
ss-P
roce
ss
Inte
grat
ion
Env
iron
men
t
Att
ribu
tes
Requirements Analysis 4 3 15 2 3 27 Functional Analysis and Allocation 1 1 9 3 2 16 Synthesis and Integration 4 3 12 4 6 29 Verification and Validation 6 5 10 3 4 28 Systems Analysis and Control 7 7 17 3 5 39 Totals 22 19 63 15 20 139
Adapted from “Systems Engineering, Best Practices,” Internal reports (2006). Reprinted with permission.
Financial Best Practices
The financial best practices were created and are maintained by the finance
function. They are a mix of programmatic and functional in nature. The financial best
practices are; employee development, data driven/real time estimating, earned value
management, integrated schedules, work authorization/budget process, contracting for
business results, indirect cost management, and estimate at completion process. Of these
eight financial best practices only two are referenced on the firm’s Best Practice
Assessment Tool, earned value management and integrated schedules. The financial best
practices include a descriptive best practice charter and a various number of attributes
with between four and ten attributes per best practice.
54
Synthesis of Literature Review
In order for supply chain management to be best in class, it must be able to
identify those activities that were best in its class, ensure that they were best and then
effectively implement the best practices. The techniques reviewed and explored in the
literature review when combined provide for an approach which revealed those activities
that contributed to a best in class supply chain management organization.
A review of the literature indicated that SCM was a new organizational approach
that exists external and internally to the firm. Although the organizational approach was
new it combined older and usually highly developed functional disciplines. The
functions identified as being typical functions in SCM both externally and internally to
the firm were; planning, operations, supplier management, logistics and material control.
One of the key external sources reviewed was Lapide’s (2007) article
benchmarking best practices in SCM. Several key points were made that are directly
applicable to the study. Lapide (2007) warns against comparisons that assume similarity
between organizations. The applicability of this observation to the study is based on the
diversity between the firm’s nine sites and the former corporate/company processes and
procedures. Further the researcher intends to limit metric review to those that measure
effectiveness, timeliness, cycle-time and quality.
Other key points made by Lapide (2007) were that successful implementation is
enabled through command of the supply chain and ensuring that practices and processes
work together in a holistic fashion. Adherence to the systems theory foundation
reinforces these points within the study, and reinforces the concept of SCM as a single
organization.
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Review of the types of best practices used in firm showed several cross practice
trends (Internal reports and documents, 2006) . Table 7 lists the common best practices
of program, supplier management, Lean and systems engineering. Financial best
practices are not listed since there are none in common with the others; best practices are
noted by an X in each corresponding column.
Table 7. Best Practices in the Firm
Best Practices PMBP SMBP Lean+ SEBP
Process X X Tools X X Implementation X X Cross-Process Integration X X Environment X X Supplier Integration/Early Involvement X X Organization X X Planned business activities X X Risk, Issues & Opportunity Mgmt. X X Help needed & independent reviews X X X Communication X X X
Of specific interest were the category groupings found in supplier management
best practices and systems engineering best practices: Process, Tools, Implementation,
Cross Practice Integration and Environment. Of the other practices, similarities existed
between supplier integration, organization, planning, RI&O and communication.
These findings lead the researcher to surmise that best practices in the SCM
functions should be in categories of process, tools, implementation, cross process
integration, and environment, and should have comparative “apples-to-apples” metrics
measuring effectiveness, timeliness, cycle-time, and quality. These best practices will be
identified as Unproven, Good, or Proven following Jarrar & Zairi’s (2000) best practices
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categorization process to help users understand the varying levels of risk in
implementation associated with practices with an unproven record.
Evaluation
Key to the HPT process model is recurring evaluation. In the majority of the best
practices studied, both internal and external to the firm, evaluation to some extent was
evident or implied. Review of the best practices internal to the firm identified
measurable attributes that seem most effective with current and historical data available
based on a consistent baseline. It would therefore seem appropriate that each best
practice that is identified have some accompanying evaluation attributes.
Methodology
In choosing a research methodology to pursue the researcher relied on the review
of the external literature since methodology used for internal studies was not available.
Of the twelve external best practice studies reviewed two were mixed methods, six were
qualitative and four were quantitative in nature. The tools used in the studies varied from
case studies, surveys and questionnaires, observation, interviews and review of extant
data. The most prevalent format for conducting research in a real life setting is the case
study method (Yin, 2003). Researchers establish boundaries for case studies to narrow
their focus. “The case is bound by a focus either on unique description or on theory
refinement and building”, (Marsick & Watkins, 1997, p. 142).
Gathering information about organizational performance can be done simply and
efficiently through interviews (Gupta, 1999). Interviews tended to be the main data
gathering method. Surveys and questionnaires are one of the largest data gathering
57
techniques and were used extensively by the majority of the studies reviewed (Swanson,
Watkins, & Marsick, 1997).
Observations play several key roles in research. Unstructured observation help in
identifying situations for in-depth observation, and structured observation give greater
depth and breadth into the phenomenon observed. Gupta (1999) also points out that
structured observation reduces bias, increases reliability, and provides a more accurate
way to report data. Caution must be taken during observation not to alter either the
process or setting which is being observed and should allow for enough time for the
researcher to distinguish between events and behavior (Swanson, et al., 1997).
In summary, the researcher focused the research on the functional areas of
planning, operations, logistics and material control. Specifically exploring elements or
activities concerning each functions process, tools, implementation, cross process
integration and environment, by collecting and comparing metrics that measure
effectiveness, timeliness, cycle-time and quality. Table 8 represents the initial base line
for the supply chain management best practices study.
Table 8. Supply Chain Management Best Practice Baseline
Planning Supplier
Management Operations Logistics
Material Control
Process X N/A X X X Tools X N/A X X X Implementation X N/A X X X Cross Process Integration
X N/A X X X
Environment X N/A X X X
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This baseline describes the areas to be “looked in” and the elements to be “looked
at” and concludes Phase 1) Establish Baseline, of the study.
In moving to Phase 2) Analyze Literature, the study continued the literature
review in light of the defining baseline above. Best practices have descriptions and
measurable defining attributes based on the information resultant from completion of the
remaining phases in the study, all classified in the appropriate unproven, good, or proven
category. These identified best practices have the identified attributes reviewed against
the BEM using a cause and effect analysis to ensure that each attribute is classified
appropriately. The research of participant behavior section of this study was
accomplished using the embedded case study approach, identifying comparative metrics,
interviewing identified job performers and identifying appropriate candidates for
observation. The specific approaches used are detailed in Chapter 3 Research Methods.
The results of the study identified supply chain management best practices
designed to improve the firm’s competitive advantage, while simultaneously developing
an approach for identifying and validating best practices which has uses internally to the
firm as well as implications for the fields of supply chain management, best practice and
HPT.
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CHAPTER 3. RESEARCH DESIGN
Introduction
The purpose of this case study research strategy was to describe best practices in
supply chain management. In this qualitative case study the researcher describes the
perceptions of subject matter experts and employees in their functional roles. Data was
collected for this study using extant data analysis, interviews and observations of a
sample of nine of the firm’s facility locations.
The analysis and synthesis was conducted on the information collected to
generate conclusions and recommendations about best practice use and identification in
supply chain management. The literature review exposed a limited amount of data and
information both internally and externally concerning best practices in supply chain
management. It was anticipated that the findings would be relevant to the supplier
management organizations in general, and specifically to the firm and the field of
Training & Performance Improvement.
Research Purpose
The research design was an empirical embedded case study. Research was
conducted and data analyzed through the theoretical lenses of human performance
technology and behavioral engineering. The study described experiences of a firm
engaged in supply chain management activities in a real world setting focusing on best
practice deployment and selection.
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Research Questions
Questions addressed by the research were
1. How can “best practices” in supply chain management be systematically identified and validated?
2. To what extent are the practices used by the firm in the Supply Chain
Management Organization “best practices”?
Rationale for a Case Study Research Design
Research is defined as “an orderly investigative process for the purpose of
creating new knowledge” (Swanson, 2005, p. 4). Organizations pursue research to
answer questions about the organization itself and to understand phenomena within the
organization and environmental factors that affect the organization (Swanson, 2005).
Gall, et al., (2007) state that although there are a multitude of definitions and descriptions
of knowledge, most can be grouped into four categories. These categories are
description, prediction, improvement and explanation.
According to Yin (2003), case study is used to investigate phenomenon in its real
life context. Further, the type of research selected should answer the research questions
proposed while considering the control a researcher has over observed behavior and
whether the focus is contemporary or historical. Case study research is used to answer
how, what and why questions (Ellinger et al., 2005).
The research was interested in looking at the theory of best practice in light of the
emerging reality which exists in the organizational setting, the research questions were
how and why questions which are best explored through experimental, historical or case
study methods. Only the experimental approach has control over behavior and due to
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ethical considerations the researcher did not exert control over any of the subjects in the
study, since historical research does not consider contemporary events and the questions
are how and why oriented, the appropriate research method of choice is the case study
method (Yin, 2003).
The descriptive function is usually associated with qualitative research, which
makes careful descriptions of phenomena of interest to the researcher. A descriptive case
study research was proposed since the research questions asked for the phenomenon of
best practice to be described in a real world setting (Gall et al., 2007).
Overview of Research Approach
A review of the literature on case study methods indicated that the most prevalent
format for conducting case studies were a series of steps or phases used to guide the
process. These steps are proposed by (Marsick & Watkins, 1997, p.140) and are listed
below:
1. Bounding the case, through theory development and sample selection
2. Selecting data collection methods that are appropriate to the task
3. Collecting and Analyzing data for patterns as they emerge
Describing and interpreting the phenomenon in light of what is know
For the study, the researcher followed the processes described and outlined above
to select an embedded case study of a single case with multiple units of analysis which
are embedded within the bounded case which is the Supply Chain Management
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organization. The embedded units were the individual sites and programs that together
comprise the organization (Yin, 2003).
Research Sample
The research study was conducted using purposeful sampling design which is
described as “a strategy in which particular settings, persons, or events are selected
deliberately in order to provide important information that cannot be gotten from other
choices” (Maxwell, 1996, p. 70). The research study was designed to explore job
performer’s perceptions of best practices in the supply chain management organization.
Subject matter experts in this organization were chosen as the participants in the study.
Subject matter experts were defined as those who met the following criteria:
1. A minimum of 5 years of experience in their current functional position.
2. Were recognized by the company as senior, or expert in their area as designated by the classification of “level 4” or higher as indicated by the company’s job classification system.
3. Considered the Process Owner or identified by the process owner for the process under review.
Based on the subject matter expert definition the researcher compiled a list of 50
potential participants for the research. A letter of introduction, (see Appendix B: Letter
of Introduction) was distributed to the potential candidates via intra-company e-mail. For
those that responded favorably, a consent form (see Appendix C Informed Consent Form)
was obtained, signed and submitted to the researcher to be stored by the researcher.
Ensuring confidentiality is discussed later in the chapter under the heading Contacting
Respondents.
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Research Design
“Case study research is most appropriate when the researcher is interested in
“how”, “what”, and “why” questions” (Ellinger, et al., 2005, p. 330). The research
reviews the theory of best practice in light of the emerging reality which exists in the
firm’s organizational setting. For the research study the setting was supply chain
management which included nine major facilities in the chosen firm.
Case Study Protocol
This study was characterized as a descriptive embedded case study. The research
design followed a case study protocol designed to outline the procedures and general
rules that govern the research conducted. The protocol also outlined the instruments,
phases of execution and products produced at each phase of the study. Following a
protocol increases the reliability of the study. The general case study outline suggested
by Yin (2003) was overlaid in the four phases of this study, refer to Figure 1 SCM
Embedded Case Study. Replication logic was used including identical lines of
questioning at the nine sites and when possible the same types of validation for each case.
The protocol was designed to provide explicit and well planed activities to help remove
the variability in data collection from differing units of analysis whether different sites or
specific programs that may bridge several sites.
The case study protocol has the following sections (Yin, 2003)
Phase 1
1. Best practice baseline
2. Create share point as a data exchange point for participants and sponsors
3. Review of current metric/measures
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4. Review current state of supply chain management organization
5. Collect relevant extant data, process management metrics, metrics supporting company/organization vision, and any other objective or subjective measures that exist
Phase 2
6. Select cases
7. Interview protocol
Phase 3
8. Distribute letter of introduction
9. Interviews
10. Identify candidates for observation
11. Observation protocol
12. Individual embedded case study reports (a) Document current case specific structure of SCM organization (b) Document questions and responses (c) Document observations
i. Document function where best practice exists ii. Explain functional structure and best practice
iii. Document extant supporting best practice metric/measures Phase 4
13. Cause & effect analysis
14. Analyze and Synthesize case reports and draw cross case conclusions (a) What was the most common method used to identify and validate
best practices? (b) To what extent were practices, “best practices”?
15. Develop policy statements for best practices and classify as unproven, good or proven
16. Conclusions and recommendations
17. Final cross case report
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Phase 1 used review of the literature and extant data to establish a baseline for
researching supply chain management best practices in the firm. In phase 2 further
analysis of the literature guided the creation of the interview protocol. In phase 3 subject
matter experts were interviewed and potential best practices were identified. Using this
information candidates were selected for observation and an observation protocol was
developed. Once the observations were completed individual case study reports were
written about the information gleaned from each of the nine sites. In phase 4 information
from the individual case studies and data collected from the observations were analyzed
using Gilbert’s (1996) behavioral engineering model to aid in identifying the attributes
used to implement and evaluate the best practices identified. The final cross case
analysis included conclusions and recommendations about best practices in the firm’s
supply chain management organization.
Data Collection Procedures
The researcher triangulated data by obtaining data from multiple sources to
validate the data collection process. There were several types of data collected and
various collection techniques used. Collection techniques included data retrieval, both
extant and historical followed by interviews and concluding with observations. These
were appropriate techniques for gathering relevant data in a case study (Gupta, 1999).
Continuing throughout the study the researcher conducted a review of the literature
related to best practices focused on the function of supply chain management, best
practices, human performance technology and behavioral engineering. The literature
review focused on the history of supply chain management, various supply chain
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management processes used in the field, various techniques used to execute aspects of
and the goals and efficacy of supply chain management as used by industry. The data for
the literature review were obtained from information sources relevant to the research
process; ProQuest, ERIC, professional journals and periodicals, books, web-sites and
other resources.
Document/Extant Data Review
Data Collection Procedures
Several types of data were collected through the four phases of the study using
various collection techniques following the strategic needs assessment approach. These
included retrieving extant and historical data, interviews, and observations (Gupta, 1999).
Literature Review
The literature reviewed includes information identifying best practices used in the
industry. The findings lead the researcher to surmise that best practices in the supply
chain management functions were categories of process, tools, implementation, cross
process integration, and environment, and should have had comparative “apples-to-
apples” metrics measuring effectiveness, timeliness, cycle-time, and quality. The best
practices should be identified as unproven, good, or proven following Jarrar & Zairi’s
(2000) best practices categorization process to help users understand the varying levels of
risk in implementation associated with practices with an unproven record. Further review
of literature highlighted areas for further exploration and lead to interviews of subjects in
those areas.
To understand the complexity of supply chain management and best practices the
researcher obtained samples of the tools and instruments that were utilized in the field
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and specifically in the firm chosen as the subject of this study. By reviewing this data,
valuable information was obtained by the researcher on techniques and tools used in the
execution of supply chain management that contribute to best in class performance. The
documents to be gathered included sample self-assessments of job functions within the
process (what does a job performer do?), sample third party assessments of job
classifications (what does management think the job performer does?), sample process
management plans (what is the process?), descriptions of the organization’s definition
and use of best practices and supply chain management and the methodologies used, and
tools used to assess progress. Copies of all documents referred to during interviews were
requested and provided. All Personal Identifying Information (PII) was redacted, and
documents that were used to execute business or used as a reference were added to an
interactive web-site that the sponsor and the researcher had access to and used to manage
the information and knowledge. This web-site was titled the Supply Chain Management
Best Practice Research (SCMBP Research) web-site. Only the sponsor had read access
to the SCMBP Research site, while the researcher had the ability to change information
and data in the web-site.
The SCMBP Research site was established to ensure easy retrieval of information
and to aid in organizing the review, ensuring access to the document for analysis and
coding. The web-site was the main tool used for creating the case study database
described in the instrumentation section that follows.
Interviews
The interview techniques used in the research project were both structured and
unstructured. Unstructured interviews were used initially to gain a more generalized
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understanding of specific topics of interest (Leedy, 1999). Results from the unstructured
interviews were incorporated into structured interviews which included a set of objectives
with a corresponding list of questions used to guide the interview process (Gupta, 1999).
Both the literature review and interviews exposed potential best practices which were
further investigated using observation.
The interviews were the primary data collection method used in the research and
provided data to be assessed in choosing candidates for observation. The interview data
provided the foundation for the research study. The interview guide (see Appendix A)
consists of ten questions and several follow-up probes designed to answer the research
questions. Interview questions were derived through critical review of the literature on
supply chain management and best practices, and the conceptual framework developed
by the researcher. The researcher conducted structured interviews using the structured
interview guide to insure an organized interview process, and to ensure replication and
consistency throughout all the interviews conducted.
In designing the interview guide and ensuring that the desired information was
elicited, a rigorous interview development process was conducted. The researcher
obtained information from the review of the literature and subsequent development of the
conceptual framework, from which the preliminary draft was created. The researcher
provided the preliminary draft to a company peer group for review and feedback. This
peer review feedback was incorporated into a second draft which the researcher then used
to conduct unstructured interviews to gather additional feedback. This second set of
feedback information was incorporated and pilot tested with a representative group of job
performers.
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Once the pilot tests were completed and changes incorporated the researcher
conducted interviews with subject matter experts from the various sites and programs
reporting to the supply chain management organization. The researcher conducted
interviews over the telephone since the experts were from various sites throughout the
United States and overseas. With the permission of participants and consent forms on
file the researcher conducted 27 audio recorded interviews. Each tape was reviewed
immediately after the interview and notes were made of the researcher’s experience. The
audio tapes were transcribed by the researcher removing any personal identifying
information in the process.
Observations
Observation is essential for assessing “relevant behavior and environmental
conditions” (Yin, 2003, p. 86). Observational data can be collected in both structured and
unstructured formats. The unstructured observation format was used and provided an
accurate avenue for data reporting.
To obtain deeper insight into perceptions of supply chain management and best
practices and to ensure triangulation of the data collected the researcher conducted field
observations of key data that surfaced during review of themes and codes from the
interview data. The protocol followed for observation was based on Taylor’s (1998) time
and motion studies. The observation protocol was:
1. Identify multiple, different practitioners of a process.
2. Study the exact series of practices used to perform each step in the process.
3. Monitor activities and time required to execute each practice in the process steps, identify quickest performance cycle-time, or best activity.
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4. Eliminate all false, slow or useless activities.
5. Document into a series the quickest and best execution techniques and tools.
All observational data was documented and stored ion the researchers SCMBP
Research file ease of access for review during the case study report writing.
Instrumentation
The quality of research designs are measured by the logical test used to judge
validity and reliability. The case study research method uses several tests to ensure that
any empirical social research studies are quality research projects. These tests include;
construct validity, external validity, and reliability (Yin, 2003).
Construct validity establishes the appropriate operational measures for the
research study (Yin, 2003). The research study used multiple tactics as described by Yin
(2003) to ensure construct validity, these tactics were: 1) use of multiple sources of
evidence, 2) establishment of a chain of evidence, 3) having key informants review data,
drafts and reports. To test for construct validity the researcher addresses each of these
tactics.
1. Extant data is collected in phases one and two. Data is also to be collected through interviews, and observations.
2. A chain of evidence is to be established through execution of each of the phase, with specific objectives, data and products to be produced in each phase as outlined in the case study protocol earlier in chapter three.
3. Having an investigator and technical personnel review draft case study report and data collected. A list of technical advisors is noted earlier in Chapter 3 under “Investigator and Technical Personnel.”
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By using these three case study tactics the researcher tests for construct validity in the
research project.
External validity is defined as “knowing whether a study’s findings are
generalizable beyond the immediate case study” (Yin, 2003, p. 37). The research used
analytical generalization to generalize sets of results to the broader theory of best
practices in supply chain management. The research used the embedded case study
method using multiple points of analysis to test for replication between the nine sites
within the overall case. This was intended to increase the opportunity of extensive
analysis while enhancing insights into the single case which increased the external
validity of the findings. In this case study nine sites were individual embedded cases
studied and then cross analyzed as a whole, these sites were from various geographic
locations and have multiple and varied core competencies.
Reliability “demonstrates that the operations of a study such as the data collection
procedures can be repeated, with the same results” (Yin, 2003, p. 34). Yin (2003)
suggests employing one of two tactics to ensure reliability, either a rigorous case study
protocol or the development of a case study database. To ensure reliability the researcher
used both the case study protocol and a case study database. The researcher designed a
rigorous case study protocol governing the execution of the case study using the four
phase approach typical to case studies and strategic needs assessments. The case study
protocol is outlined earlier in this chapter.
The researcher initiated a case study database using a Share-point to facilitate data
collection, and warehousing. The database included the two separate data collections
suggested by Yin (2003), extant or evidentiary based data and reports of the investigator.
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This allows the researcher to have a full view of the research approach and all redacted
documentation and communication that transpired during the research project.
Included in the research database are the researcher’s case study notes, documents that
support the case study, any and all tabular, metric material, and the case study narrative.
The case study narrative was the documentation that the researcher gathered and
questions answered by the researcher when addressing each of the firm’s sites. The
narrative was written following the case study protocol.
Data Analysis and Synthesis
The most difficult aspect of conducting a case study is analyzing the data.
Development of a case study data analysis strategy ensures that “evidence [is treated]
fairly, produce [es] compelling analytic conclusions and rules out alternative
interpretations” (Yin, 2003, p. 111). Developing a case description was the general
strategy governing the research. This was achieved by describing how best practices are
identified and validated, and then identifying to what extent the best practices used in the
firm were best.
At the completion of the data gathering process, the extant and interview data
were collected and transcribed. The researcher then organized the data for review and
analysis to identify trends and anomalies that required further exploration through
observation. When completed the observational data was recorded and included for
analysis. The researcher followed the analysis and synthesis process described below.
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Data Analysis
Yin (2003) states that case study research of a qualitative nature require research
and systematic data analysis to be rigorous and follow specific protocols. To accomplish
this, the researcher used information from the literature review, the conceptual
framework, and the interview questions to develop the initial set of analysis categories;
Appendix D illustrates the analysis coding categories. Revisions were made to the
coding scheme based on review of the initial interviews and information that resulted,
additional categories identified from the interviews were incorporated into the matrix.
The researcher conducted focus groups with technical advisors from the firm. These
focus groups followed the process outlined below to ensure validity and authenticity of
the researcher’s analysis.
1. Two technical advisors from the firm will read initial interview transcript results, apply the coding scheme documenting notes on applicability and any additional categories required.
2. The researcher and the technical advisors will jointly review the coding results
and reconcile any differences reaching consensus on changes and additions. 3. A second interview transcript results will be reviewed by the technical
advisors; and steps one and two will be repeated. 4. Analysis of themes and patterns that emerge as a result of this process of
review with the technical advisors will lead to the researcher making required changes to the coding categories and the conceptual framework.
Each interview was documented and recordings transcribed individually. These
individual documents were coded using an off the shelf coding program with the resultant
data recorded in an interview matrix (see Appendix E: Interview Data Analysis Matrix).
Numbers represent the participants interviewed with the coding categories on the left.
Each interview was reviewed and analyzed for themes and patterns, with quotes being
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recorded in the appropriate categories using a coding process. Pattern matching to
identify themes was the specific analytic technique that was used since this study was
concerned with identifying those themes in these practices and processes that contribute
to the overall performance of a specific activity that can be replicated as best in class or
best practice.
The matrix helped the researcher to visually identify patterns among recorded
interview responses. Throughout the process the researcher continued to refine and
revise the process by updating data categories.
Each observation was recorded on individual analysis forms which in turn were
coded and the data recorded in an observation matrix. An observational data analysis
matrix similar to Appendix E was developed and populated based on the patterns, trends
and anomalies exposed during the interview data analysis and subsequent observation.
The observational data was reviewed following the same coding process used in the
interview data analysis. Observational patterns were visually identified from the data
recorded.
At the conclusion of the observational portion of the data analysis process a
number of potential best practices and various organizational strengths were identified.
The researcher identified enablers to the best practice and organizational strength, by
analyzing each using a cause and effect diagram overlaid with Gilbert’s (1996)
behavioral engineering aspects; data, systems, incentives, knowledge, capacity, and
motive. Figure 14 illustrates the analysis tool the researcher proposed and used to
identify, explore, and graphically display all of the possibilities that lead to the discovery
of the root causes’, (Brassard & Ritter, 1994).
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The basic cause and effect diagram, also known as a “fishbone” diagram was used
to identify why the typical cause dispersions occur. For the purpose of the study the
researcher was interested in dispersions along the BEM aspects, the cause being the best
practice in question. At each point in the analysis the question of why the dispersion
occurs was documented under each aspect. Repetitive questioning drilled down to the
eventual root cause or enabler. This root cause dispersion analysis aided in defining
enablers used to implement and assess the identified best practices (Brassard & Ritter,
1994).
Figure 11. BEM cause & effect diagram. Adapted from: T. F. Gilbert (1996).
Data Synthesis
To facilitate synthesis of the data collected the researcher created Table 9 to
visually review document, interview, and observation similarities resulting from the
various collection techniques. These modes of analysis assisted the researcher in
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triangulating the data by identifying differences and similarities between data sources and
were instrumental in development of the study findings.
Table 9. Data Source Synthesis Matrix
Data Collection Technique Coding Categories
Document Analysis Interviews Observations Organizational reporting to SCMO
Existence of SCM function
Elements of SCM
SCM element consistency between Programs
What is a best practice
How are best practices identified
Best practices selection/implementation
Organizational strengths
Strength Measurements
Best practice communication
Best practice incorporation
The researcher created Table 10 to facilitate synthesis of the behavioral
engineering enablers for the best practices and organizational strengths identified during
observational data analysis. Best practices and organizational strengths were coded
during the data analysis portion of the study and were reflected in table 3.2 horizontally
under their respective categories. The behavioral engineering categories were
represented on the left vertically under environmental supports or repertory of behavior.
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Table 10. Behavioral Engineering Enabler Synthesis Matrix
Behavioral Engineering Enabler Synthesis Matrix
Observation Enablers Enabler Appearance in BEM Categories
Indi
vidu
al
Env
iron
men
t
Beh
avio
r
Dat
a
Sys
tem
s
Ince
ntiv
e
Kno
wle
dge
Cap
acity
Mot
ive
Organization Communication Tools People Totals
Maintaining the confidentiality of participants was of supreme importance,
therefore the researcher assigned codes for each of the participants. The coding created
was WS_10001 through WS_10053. All names were removed from any recordings,
transcriptions, submitted documents and notes. Throughout the review, analysis and
synthesis process the participant codes were used in place of names. All notes and quotes
that were recorded and documented were done using the coding process. This ensured
consistency throughout the research enabling the researcher to reference and cross
reference pertinent data.
The synthesis process enabled the researcher to divine patterns and themes within
and across the research participants, locations and questions. Aiding the synthesis
process the researcher designed a Participant Background Synthesis Matrix frequency
table, (see Appendix C).
This matrix was designed to enable cross case analysis of the variations among
participants based on professional, educational, work history, and experiential
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background. Using a multilayered approach provided the researcher with interpretative
insight into the data and findings. The researcher achieved this through analysis of the
dimensions of the findings through pattern and theme analysis and diligently searching
for inconsistencies in the data and findings. This was compared to the previous literature
review.
Contacting Respondents
Several documents were included to ensure organizational support, site and
program access and confidentiality documentation. A letter of introduction adapted from
Yin’s (2003, p. 71) example was created for site and program leadership (see Appendix
B: Letter of Introduction). This was signed by the study sponsor allowing the researcher
access to personnel for interview and questioning purposes as well as facility and
program access for observation of activities. A copy of the Informed Consent Form
included (see Appendix D) which was provided electronically to the participants selected
to participate in the research study.
All participants have been granted access to a Share point that provides the
schedule of activities, access to current published information about the study. Those
that requested access were given read/write capabilities in order to actively participate by
attaching relevant documentation and participating by providing feed-back on their
perception of the process. Confidentiality shall be maintained by the researcher through
various methods including removal of any and all personally identifying identification
through coding of information and expurgation from documentation.
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Organization Conducting the Study
The Supply Chain Management Organization conducted the research study. The
Fort Walton Beach facility served as the base for the study.
Investigators and Technical Personnel
The Principle Investigator (PI) was Jay F. Chance Supplier Program Manager in
the Special Operations Forces Global Services & Support division, the study was
conducted for the dual purposes of providing pertinent information to the supply chain
management organization about the use and execution of best practices in the field, and
as a submittal for partial fulfillment of the requirements for a Ph.D. in Training and
Performance Improvement form Capella University.
Technical Advisors fall into two categories; the dissertation committee and Firm
employees participating in a focus group fashioned to help guide the study and
publication of the final report. The technical advisors were
1. Paul Hardt Ed.D. Dissertation Mentor, Capella University,
2. Keith Johansen Ph. D. Dissertation Committee member, Capella University
3. Claribel Purcell Ph.D. Dissertation Committee member, Capella University
4. Susan Taylor Ph.D. Dissertation Committee member, Capella University
5. Keith Castleberry, Fort Walton Beach, Supplier Management Site Lead and
the PI’s immediate supervisor..
6. David Hill, Fort Walton Beach, SM Procurement Manager.
7. Ken Shaw, Vice President Supply Chain Management, Sponsor of the study.
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Ethics
The firm chosen for this study has developed over the past decade one of the most
comprehensive ethical standard in the aerospace industry, from specific policy and
procedures to internal Institutional Review Boards, and review groups for internal
surveys. The research study adopted the “ecological ethics” approach where “researchers
judge the morality of their decisions and actions in terms of the participants’ culture and
the larger social systems of which they are part” (Gall et al., 2007, p. 460). In this case
the mutual culture and larger social system that the researcher and participants had in
common was the defense contract company. This common foundation and the principles
outlined in the Collaborative Institutional Training Initiative (CITI) guided the ethical
considerations and conduct of both the researcher and the participants.
Timeline
Figure 12 is a graphical representation of the study and depicts the four phases of
the research study and the major milestones conducted in completing the research study.
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Figure 12. Research schedule
The research study was to describe best practices in supply chain management.
This qualitative case study was designed to describe the perceptions of job performers in
each of the supply chain management functional roles. The data that was collected for
this study through extant data analysis, interviews and observations was from nine of the
firm’s facility locations. Analysis and synthesis of the data collected generated
conclusions and recommendations about best practice use and identification for the
supply chain management organization and the field of Training & Performance
Improvement.
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CHAPTER 4. RESULTS
Introduction
The purpose of this study is to describe supply chain management and best
practice identification, use and validation, in the firm’s newly created Supply Chain
Management Organization. This study was an empirical embedded case study describing
the real world experiences of participants from multiple sites and locations within a firm
engaged in supply chain management activities. The researcher conducted the research
to answer the questions:
1. How can “best practices” in supply chain management be systematically identified and validated?
2. Are the practices used by the firm in the Supply Chain Management
Organization “best practices”?
With no prior studies being conducted in the firm addressing supply chain
management and best practice identification, use and validation the researcher conducted
the study using the study protocol as a guide. Chapter 4 presents the demographics of the
study, a description of the embedded case study units, presentation of the embedded case
study unit summaries, cross case analysis, and synthesis of themes. The following
outlines chapter 4:
1. Demographics
2. Embedded case unit description (a) General case description (b) Interview description (c) Observation description (d) Behavioral engineering model cause and effect overlay description
3. Presentation of embedded case studies
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4. Cross case analysis (a) Themes in interviews (b) Themes in Observations
5. Synthesis of Themes
Study Demographics: Who Participated?
The Supply Chain Management Organization granted access to participants and
sites in order to conduct the study. This organization included nine sites or facilities
across the United States and overseas. The Supply Chain Management Organization is
relatively new, having been created in 2007, and has been very aggressive in developing
and deploying a supply chain management business concept for the firm. A divisional
growth goal of 2X5 (two times the growth in five years) has challenged the new
organization to initiate unique and creative approaches to supporting this expected
growth.
The researcher compiled the embedded unit data and developed the following
aggregate demographic analysis. There were 45 subject matter experts recommended and
approached to participate in the study. Twenty-seven of the subject matter experts agreed
to participate in the study. All the participants were employed within the Supply Chain
Management Organization and were a diverse mix of gender, educational background,
work experience, and hierarchical levels, within the subject matter expert definition.
Figures 15, 16, 17 and 18 show in graphical form the demographics of the participants
which represented the diverse participant perceptions included in the study. Figure 19
shows the participants exposure with the subject matter based on responses to questions
in those categories.
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Figure 15. Participant work background and experience
Figure 16. Hierarchical levels of the study participants
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Figure 17. Participant knowledge of the subject
Description of the Case Study
The research was conducted in an embedded case study approach, using the
individual sites as embedded units within the overall case. Use of the embedded case
study approach allowed the researcher to quickly identify subject matter experts, solicit
participation in a group forum, conduct interviews and observations in a manner that
minimized participant interaction and thus the potential to bias follow-on participant
responses.
Presentation of the case studies includes a general description of the embedded
case study unit, coded participant interview responses, summary of the observations, and
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ends with identification of enablers from the observations through a behavioral
engineering cause and effect overlay analysis.
General Case Study Description
A general description of each case unit is included in the case study presentation.
This description includes a general outline of the embedded case current organizational
structure in regards to the Supply Chain Management Organization and the embedded
case specific participation statistics. Embedded units were ascribed random numbering
and no descriptors were included to ensure anonymity of the cases presented.
Case study statistics represent the percentage of participant participation,
questions answered, and percentage of responses coded. Each embedded case study unit
had identified five subject matter experts which the researcher approached for
participation. In all, only 56% of the subject matter experts solicited agreed to
participate. The subject matter expert participation represented below indicates the
percentage of participation each site contributed towards the total 45 subject matter
experts. 100% participation by an individual site would have equaled a total of 11%. Of
the ten questions asked in the semi-structured interviews, participants responded to 82%,
with 96% of the responses being coded for analysis. In some of the embedded units,
coded responses outweighed the questions answered percentage, indicating that the
response had multiple applications. The breakdown by embedded case is included in
Table 12.
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Table 11. Embedded Unit Response Coding
Site
S01
S06
S09
S10
S12
S13
S16
S20
S30
Total
SME Participation 4% 9% 7% 7% 4% 2% 7% 7% 9% 56% Questions answered 95% 88% 93% 90% 70% 60% 83% 70% 90% 82% avg. Responses Coded 105% 111% 104% 111% 43% 50% 120% 110% 111% 96% avg.
Description of Interviews Conducted
Semi structured interviews were conduct within each case following the interview
guide (see Attachment A). The interview guide provided the interview questions that
were developed to answer the research questions, in most cases follow-up questions were
asked to provide clearer understanding of participant perceptions. With participant
consent the interviews were digitally recorded, with recordings and researcher notes
being transcribed.
Coding of Interviews
These transcriptions were reviewed by the researcher and the study technical
advisors to develop a coding scheme to be used to aid in interview analysis and identify
interview themes. Transcriptions were then loaded into a software program which
enabled the researcher to code all the transcriptions. The coding categories developed by
the researcher and the technical advisors were:
1. Descriptions of Supply Chain Management (SCM) in the company
2. Identify SCM in the company
3. Descriptions of SCM in the industry
4. Identify SCM in the industry
5. Measures of SCM
6. SCM suggestions
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7. Descriptions of Benchmarking (BM)
8. Experience with BM
9. Descriptions of BP in the company
10. Identify BP in the company
11. Descriptions of BP in the industry
12. Identify BP in the industry
13. Best practices (BP) in the field
14. BP suggestions
15. Measures of BP
16. Organizational Strength
Each interview transcription was analyzed with participant’s responses being
coded in each of the coding categories. This enabled the researcher to quickly and
efficiently find and review participant response information that was pertinent in
answering the research questions. The coding software enabled the researcher to quickly
compile results by embedded case unit, and in the final analysis quickly enabled cross
case analysis of common data to identify cross case themes.
Results of the interviews are presented by embedded case noting participant
responses in each of the coded areas. Participant identifiers have been redacted from the
source material. The researcher used responses verbatim from the participants. Where
subject matter expert descriptors allowed for site, or participant identification the
researcher used alternate descriptors, noted in [brackets], for those activities presented.
Each embedded case is presented with participant’s responses reported in the respective
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coding categories. Not all embedded cases had reportable responses in each coding
category.
Description of Observations
Field observations were conducted at each site to further understand potential best
practices in the Supply Chain Management Organization that were identified while
analyzing participants coded responses. Several of the study questions were designed to
elicit participant responses that would lead the researcher to observational opportunities.
All observational opportunities suggested were pursued.
The researcher used two observational techniques in conducting the field
observations in the study, Taylor’s (1998) five step physical task observation protocol
which was identified and outlined in the methods section of Swanson’s (2007) knowledge
task analysis for those tasks that were predominately behavioral in nature. A summary of
the observation is recorded in each embedded case presentation.
As with presenting interview responses, the researcher used alternate descriptors
for activities or actions that would allow a reader with general knowledge of the firm to
identify sites or participants. In several cases subject matter suggestions for observation
were similar, and in several cases the suggestions were identical activities that had been
previously benchmarked and replicated. For those instances, the researcher recorded the
initial observation and referenced that observation in subsequent case reports noting
unique specifics. Forecasting is an example that was reported as a best practice for
multiple sites; in most cases the activity was similar even though some tools varied.
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Behavioral Engineering Cause & Effect Overlay Analysis
Following each observation the researcher identified enablers to each potential
best practice by analyzing the practice using a cause and effect diagram overlaid with the
Behavioral Engineering Model (BEM) categories of; data, knowledge, systems, capacity,
incentive and motive (Gilbert, 1996). Table 13 represents a graphic example of this
Behavioral Engineering Model Cause & Effect Overlay (BEM/C&E). The researcher
created a BEM/C&E for each observation using input from the literature and the subject
matter experts involved in the observation.
The researcher first identified the initial enablers (or causes) of an observation and
continued to “drill down” into each BEM category to the root cause, or root enabler by
identifying the cause or enabler for each subsequent enabler until no other root enabler
could be identified. Presented in the BEM/C&E are the root enablers for each of the
potential best practices categorized in each of the BEM categories. Table 13 provides an
example of the BEM/C&E results documentation table.
Table 12. BEM/C&E Example Data Systems Incentive
Env
iron
men
tal
Knowledge Capacity Motive
Beh
avio
ral
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Embedded Case Studies Presented: Nine Sites in the Firm
The following is a presentation of the nine embedded case study units. A brief
organizational summary is followed by participation statistics. Coded responses precede
a summary of observations followed by a BEM/C&E for each observation from the
embedded case.
Embedded Case S01 Results
Embedded case unit S01 is predominately a program based organizational
structure referencing only operations and supplier management as the key roles
supporting the supply chain management organization. S01 contributed 4% of the
subject matter expert participation, with 95% of the semi-structured interview questions
being answered and 105% of those responses being coded for analysis.
Interviews
Participant coded interview responses for Case S01 are reported below.
Describe SCM in the Firm
Participant’s description of supply chain management within the firm noted
several overarching activities within the functional role, and tended to depict current or
local activity. Participants stated:
Supply Chain Management from a logistics spares analysis and spares engineering point of view, take the parts that are required for a platform or product, and establish the initial provisioning effort and [then] plan [how] to support the customer. Part of this is a sustainment spares analysis for the customer.
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This participant went on to say:
It’s when you take a need for an item through the identification of a need for it, to finding a source, preparing and then delivering that item back to the person that identified the need or the area that needs the item.
Another participant stated:
Supply chain management identifies the need and what that need is for. [Defining] what the characteristics of that need are. Once the need has been identified and a characteristic established it goes into the supply chain management stage, that is when supply chain management finds a source, procures the item, pays for it [and then] getting it to shipping and then getting it to the place it needs to be and providing status throughout the whole effort.
Describe SCM in the industry
Descriptions of supply chain management found in the industry were similar to
participant descriptions within the firm with the exception that participants noted that
portions of supply chain management can be contracted out. One participant stated:
The supply chain itself is, “how are you going to get the parts, where will they be stored, how are they delivered to the end user and how are they transported and cycled for repair.” That is the chain. How you manage it can vary from internal management to external like a Third Party Logistics (3PL) service.
Measure SCM
Supply chain management was perceived to be measured in the following manner
based on specific activity associated with the supply chain management effort:
There should be an assessment based on efficiency. [Questions like] is it cost efficient to lay in a lot of spares? How you balance the need for the parts to the need of the parts you have available. Are lead-times a problem, how do you manage the whole thing. How do you manage what you put in your pipeline, what’s on shelf for repairable. [These are questions that need to be asked.] [Are we providing] a balance of supply and demand at the cheapest cost.
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Describe Benchmarking
When asked to describe the techniques used to benchmark best practices in Case
S01, the participant stated that:
If I knew what [performance I was trying to improve and what measures] I needed then I can go to another site that had similar metrics and measures. I can then ask them how they did it. If I have a comparative metrics with theirs then I know who is doing something better than me. In this case I would try to get three or four [sites that are doing something similar and have similar measures] and see which best practice approach is the best.
Some participants indicated that they would “call around” and identify what other sites
were doing as a way to identify best practices.
Identify Best Practices in the Firm
Participants used the following statements to identify best practices in use within
the firm:
There are global best practices like earned value management, employee timekeeping system, and then there are program specific best practices that affect execution.
Identify Best Practices in the Firm
Participant noted the following approaches use to identify best practices within
the firm.
1. “A best practice is basically a person that identifies the way that they’re doing things as the best way of doing something.”
2. “These have been given to us. We are told that they are best practices, my understanding is that somebody has analyzed this and found that these practices are better than someone else’s practices.”
3. “I was directed to use them.”
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Describe Best Practices in the Industry
Industry descriptions differed from internal descriptions by being more detailed
rather than using specific examples as indicated by participant’s statement:
It would be a process that is proven to be one of the top processes. It would be cost efficient, the one process that happens to work the best of all the others.
Measure Best Practices
Participants noted that measures of best practices fell into the following categories
1. “Return of investment, without improvement it may not be a best practice.”
2. “It has been deemed so by being tested against other similar practices. It not a whim, but something that is proven.”
3. “Measures of efficiency and cost impacts Another participant stated:
If you have a proven process that works, that you have leaned out, then this is as good as it gets unless you develop some transformation technology [that significantly changes the process]. Technology is a driver for change [as a process improvement].
Organizational Strength
Participant’s perceptions of organizational strengths for case S01 included
automated report functions and databases. Participants stated:
We are the model Logistic Support Analysis database. We are the most comprehensive in the company. Because the customer [when they negotiated the contract] decided that they wanted to maintain [a database] for the life of the air-frame. We can supply data on a moments notice to anyone.
Another participant noted the reports available:
There are table entries, mismatches, exceptions, and incomplete reports available. These are scripts run once a month and we use that to measure the health of the data-base.
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Additional input indicated that site S01 had a robust paperless system. Participants
stated:
We are virtually paperless, we track everything through a computer so I can at any given moment gave you a real time computer generated no guesswork earned value management performance [schedule performance index and cost performance index] on and instants [notice] instead of in the future. This removes subjectivity [and] guesswork. This is all computer generated and system data.
Observations
The opportunities for observation within case S01 were Paperless systems and
Logistics Support Analysis activities.
Paperless
Participant responses indicated that paperless activity should be considered a best
practice. In order to observe this activity the researcher was advised by several
participants to observe traditional work activity and then observe that same work at case
S01 which had transitioned most of its activities to a paperless system.
After observing several activities in both settings the researcher noted that it was
the tendency of persons performing activities to use paper based transactions when that
opportunity was available. In some cases this was due to contributing organizations
internal desires to “hold” physical files. The researcher did not find requirements that
physical files be maintained, only “data records” were required to be stored. It was
observed that while physical files were stated as being “easier” for locating information,
in practice this was not the case. Accessing the same data in a paperless filing system
took a similar or quicker amount of time. It was also noted that physical transactions
took twice the time to execute over paperless systems in the best circumstances, while in
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the majority of opportunities physical transactions were exponentially longer in their
execution.
Paperless systems and transactions where physical transactions were no longer
possible were embraced and transitions to those systems were reported to be shorter in
duration with fewer problems. It was noted that paperless systems had the advantage of
quick, seamless transactions. Sorting and data mining were also significantly improved.
One of the most important benefits that the researcher noted was that paperless
transactions were “boundary-less” in nature. An organization could truly operate in a
virtual fashion and proximity and location were not relevant with paperless systems and
transactions.
Enablers for paperless systems and transactions were the systems themselves;
incentives included limiting access and the ability to keep paper systems in parallel.
Once the system was in place, user’s motivation to learn and use the new system
increased along with their capacity to perform other functions and roles.
Logistics Support Analysis
Logistics Support Analysis (LSA) is a support role activity or process related
specifically to programs. The LSA process is predominately product support, or post
product sale in nature with “up-front” activity occurring in the design phase to ensure
ease of maintenance and repair in the support phase. LSA has a prime role in developing
analytical data used to influence design of a system or platform to enhance
maintainability. This data includes logistics decisions as a means to minimize expected
support costs.
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The LSA program observed was primarily the responsibility of a cross functional
integrated team including; the customer, engineering, logistics, contracts, cost estimating,
technical publications specialists and material which includes suppliers and
subcontractors. When executed correctly, the LSA program ensures the most cost
effective approach for a product or platform, during the design phase as opposed to
support programs that may be required to adjust to platforms and programs that did not
have long range planning considerations for support.
Behavioral Engineering Cause & Effect Overlay
Table 13. Case S01 BEM/C&E for Paperless Best Practice Data Systems Incentive
Env
iron
men
tal
- Cross functional
- Short “find” time - Sort and locate - Automated Record and Information Management - Immediate receipt - Quick response - Cross functional - Cross Site - Historical archive - Short term data transactions
- Paper obsolescence - Reduced filings size - Limits on Records Information Management findings
Knowledge Capacity Motive
Beh
avio
ral
- Increased capacity - Less to manage
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Table 14. Case S01 BEM/C&E Logistics Support Analysis Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional - Quantity - Quality
- Demand planning - Access to functional, customer and supply base
- Leads to other opportunities - Exposure - Success is rewarded
Knowledge Capacity Motive
Beh
avio
ral
- Understand customer data - Experience - Cross functional team
- Ability to manage large amounts of data - Team support
- Long term - Predictable - Improved internal relationships
Embedded Case S06 Results
Case unit S06 conforms to the typical structure and functions cited in the
literature representation of a supply chain management organization. S06 organizational
structure includes the functional roles of logistics, warehousing, planning, sourcing,
product support and finance. S06 links these physical roles with systems, information,
analysis and communications capabilities.
The following are participant responses recorded in the coding categories for case
S06 which contributed 9% of the subject matter experts participating in the study. 88%
of the semi-structured interview questions were answered with 111% of the questions
being coded for analysis.
Interviews
Participant coded interview responses for Case S06 are reported below.
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Describe SCM in the Firm
Participants were asked to describe supply chain management within the firm,
noting the functions, activities and capabilities which were associated with the supply
chain management organization. Participants stated that:
The functions I associate with supply chain management are contracts and pricing and finance personal. You also have procurement, delivery management people, [who are responsible for]tracking and monitoring deliveries, and supplier program managers who track what’s going on at the supplier’s facility for problems. Also included are manufacturing engineers, production is involved building parts in house, and close out people working supplier invoices, DD250’s [sale/transfer of product], and accounts receivable and payable.
Another participant described supply chain management in broad overarching terms,
stating that supply chain management is:
[Supply Chain Management is] transactional in nature. It is from the receipt of an order from the customer to the time I deliver the product.
In some cases the subject matter expert described supply chain management in relation to
the contract types, or performance expectations. One participant explained:
Supply chain management usually has performance based contracts which states we are to give the end user a certain level of performance, for whatever it is that they require within a [performance threshold] window. In these instances you're not tied to a specific date and time.
Another participant described supply chain management within the firm in relation to
their functional role and program which they support, stating:
As an asset manager, it depends on the structure of the program. [In most cases] a requisition goes to a buyer through a system that’s been pre-populated with strategic agreements. That order gets placed, and there is obviously time in queue until that requirement is received and delivered. So there is a contract in place Finance activities take place, we monitor schedule activities. [Requirements activity initiates a procurement contract which ends in a financial transaction that is monitored by the asset manager].
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Describe SCM in the industry
Based on responses, site S06 had extensive experience with supply chain
management as it exists in the industry. Participants described supply chain management
within the industry in a variety of ways. One participant described both the physical
functions and the non-physical capabilities in the following manner:
[A] supply chain is in essence the linkage of providing products and or service and all the supporting components that it takes to make a particular component. [An] example [would be] the material items that should be procured and fabricated and assembled to make the final goods, [these are a part of the supply chain]. The supply chain is all the way from where the requirement originated to where the final produced part ends. From a service perspective it would be similar, the service may be provided by the company or there may be reach-back into some of the suppliers and the supply base. It’s the chain of all the components that it takes to deliver a product and or service. It’s shipping, storage and every thing to get an unfinished material to a finished product.
Other descriptions included those found in the literature and as depicted by various
societies and organizations focused on supply chain activity. One participant noted in
their description that
Supply chain management is the end to end process for planning, delivery and execution of material to support a customer’s requirement. I always think of the supply chain in terms of the Supply Chain Operations Reference – model (SCOR), where they have the phases defined as plan, make, and delivery. Then you have the reverse logistics piece.
Other participants noted the non-physical activities and roles of supply chain
management in the industry as
It is the end to end process and almost a continuous loop process to an extent. But it is that pipeline of information and systems that facilitate the delivery of a product or service. It is a series of activities that are usually executed by functions.
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Additional comments were Supply chain management has to do with the philosophical question of, do [we] have the tools, the training [and] the systems, to facilitate an efficient product delivery? Do we have the right demand planning, and do we have the right engineering support for say an out of production type of item? It’s the oversight required to assemble all those pieces of the supply chain in the most efficient way possible. Cost efficient, schedule efficient. An over sight from a management perspective.
Some participants noted specific roles and capabilities provided by supply chain
management. One participant stated:
1. “SCM is the supplier management, operations, product support and supply support functions.”
2. “It’s not just the material management piece, but also all the supporting functions which include pricing, contracts, operations. I think they all play a part in the supply chain function.”
3. “All the action required to, deliver a product and the actions required to purchase from vendors to build a product to deliver to our customer.”
Identify SCM in the Firm
When asked to identify supply chain management within the firm participants
were able to identify several roles and activities in supply chain management as well as
identifying how they relate to the supply chain management function and role.
Participants stated:
So supply chain management is management of that supply which includes knowing you have the proper metrics defined to achieve the end result of what the supply chain responsible for. [It is] the responsiveness of the supply chain to properly forecast requirements, to establish the infrastructure, including IT, warehousing, repairing, and procurement contract with the supply base to support your supply chain.
One participant was able to articulate their part in the supply chain management
organization. This participant stated:
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I consider myself to be part of supply chain management; I am part of the core supply chain management (product support) which has Responsibility, Accountability, and Authority (RAA) for process definition, tools definition and skills definition.
Measure SCM
Participants provided the following list of supply chain management measures:
1. “Cost reduction initiatives”
2. “Process health metrics”
3. “Timeliness”
4. “Cycle-time”
5. “Quality”
6. “Efficiency”
7. “Schedule”
Describe Bench Marking
When asked to describe what benchmarking was and how the participant might
use benchmarking to support performance improvement one participant responded:
In theory you get everyone in room and you analyze the task at hand. Discuss and brainstorm all the issues so that by the end of the session you have a list of all the activities required to complete the job. You use those activities that yield better results than the others as the steps to follow to execute the process which then is a best practice.
Describe Best Practices in the Firm
Several of the semi-structured interview questions were designed to understand
participant’s perceptions of best practices. These questions asked the participants to
describe best practices as there were seen within the firm and where possible to identify
internal and external best practices. Participants described best practices as:
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A best practice is a process, skill or tool that achieves the best results or provides the best value.
Identify Best Practices in the Firm
Several participants indicated that identification of best practices were more
involved that viewing what was best. Participants responded that to identify a best
practice you look for:
[A best practices is] an industry standard. We can see this by how well it’s adapted to your business and your process, how well it’s communicated and replicated in our program areas. It has been found to be the best tool, the best communication flow.
One participant identified a current activity as a best practice, explaining what the
benefits and impact were for the activity stating:
I think overall the concept of what used to be called the [cross functional leadership team] is a best practice to identify[ing] subject matter experts within a certain discipline across all the sites to standardize skills and tools and processes should be considered a best practice. This leads to more efficient organizations and provides the opportunity to transfer skills across different sites and programs and also gives you a more cost effective organization, because you are not reporting multiple tools or processes.
Other participants noted some of the internal problems the firm is having concerning best
practices and how they are deployed and communicated. Concerning constant change in
the workplace one participant stated:
Since our business continues to evolve there is no standard way to approach similar tasks in a repetitive manner. Our problem is that you are trying to write a standard approach to a business that is continually evolving. So what we’re trying to do is get a handle on what we are doing today and write a best practice for today knowing that we will have to touch it in a periodic fashion and change or update the practice.
Another pointed out concerns with communicating best practices by stating: if it isn’t a documented best practice, but it was adopted because it was a solution to a problem that existed on a given program, sometimes that stuff is hard to
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[data] mine and becomes a matter of how well we are communication our success across the organization, and when in the process of replicating that process, does it become part of our standardized documented process that becomes best practices.
Yet another stated:
It’s not just something that we do it is something that is documented. If it is that good we should have it written down so that it becomes a process. To my knowledge this does not exist.
Describe Best Practices in the industry
Participants described best practices in the industry based on the experience they
have had with supply chain management related organizations they are affiliated with.
Participants stated that these were usually vetted and had some historical performance to
support a claim of best practice. Participants identified:
[That] if you look at the SCOR model it covers that in detail.
The same participant described the aspects of a best practice as:
Specific tasks that link elements of the supply chain together and I believe a best practice is coming up with the most efficient process, and being able to repeat the process and come up with predictable results.
Identify Best Practices in the industry
When asked to identify best practices in the industry, one participant responded
based on their membership in supply chain related organizations and the literature that
they review. The participant stated:
Through the knowledge of the industry, literature, research into supply chain society, the council for supply chain management, and professionals. I am a member of those organizations, and receive publications and attend seminars and meetings.
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Measure Best Practices
Descriptions of best practice measures were numerous and similar to those
described for measuring supply chain management. A list of participants’ response
describing best practice measures are:
1. “Health metrics”
2. “Process segment measures”
3. “Timeliness”
4. “Cycle-time”
5. “Quality”
6. “Efficiency”
7. “Should have cross site applicability”
8. “Compliance”
9. “Process impact (lean)”
Organizational Strength
Site S06 participants had numerous examples of what they considered to be
organizational strengths. One participant response that was chosen for observation was:
Our focus on developing the skills of our employees is a strong point for our organization.
Another participant response which was observed was:
I think the fact that we have full representation across the programs and we have the right people identified as team members who can make decisions to identify the best practices and deploy those best practices across the sites.
Yet another participant response that was observed was:
Earned value management requirements do not lend themselves [as measures of performance] to [the] performance based [contract ] environment, and a need for
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real time data. So we adapted what we called a spares checkbook where we tried to monitor the day to day activity of supply chain management from a financial management point of view. If I place the order how much is that going to cost me, how do I balance that against the metrics I trying to perform against? It became a really integrated tool between finance and asset management community.
Another respondent indicated that retention and development of subject matter experts
was an organizational strength when they stated:
The ability to develop experts in certain fields and provide an environment in which they can improve and expand their knowledge is a strength that we have.
During discussions with subject matter experts about organizational strengths there were
two participants that offered ideas that they considered being organizational strengths that
had yet to be developed. Included are the participants comments that:
We really need to get everyone to speak the same language because we don’t speak the same language in the company [and this impedes progress and performance].
Another participant indicated that the organization should
[The organization needs to] develop an estimating model that can accurately estimate [the cost of] the supply chain activity. For example if you have a particular program that you were supporting [using] the total supply chain, or everything that [is] needed [in order to] support the air craft [including] having parts go from [the] source all the way through installation on the air craft. We need to develop models that can replicate that [activity], and do it efficiently. [We need the ability to] generate a number for [cost] proposal purposes.
Observations
Participant responses yielded the following opportunities for observation of
potential best practices.
Cross Functional Leadership Teams
An observation of successful decision and direction communication were teams
were represented by a Cross Functional Leadership Team (CFLT). The CFLT is a cross
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functional team comprised of leadership and subject matter experts from all functions
involved in the execution of a strategic level activity. This cross functional
representation ensures that typical silo, individual site or functional decision making is
avoided. All decisions and direction involve input and consideration of the benefits and
impacts to each organization. No decision is made and directed without careful
consideration of each input. Cross functional and cross case participation ensure that
each function and site have their specific requirements and needs fully vetted by the
group. The impact from CFLT type activities is the cross site/functional participation and
communication of this participation to the tactical level. In essence the tactical decisions
and direction provided has been vetted by leadership on a strategic level.
From the observations it was noted that effective and desired communication
should involve decisions making and organizational direction type activities. The
activities noted were both strategic and tactical in nature.
Observation and analysis of the literature lead the researcher to note that
participants indicated that clear representative participation in organizational decision
making was essential to successful execution. Knowledge and visibility of their interest
being presented and considered contributed to individual consensus and successful
execution of the resulting decisions and directions. It was noted during observation that
although some participant’s expectations may not have been met, as long as they were
considered and addressed, participant consensus was typically universal.
Additional observational notes show that representative participation in the “big
picture” decisions or strategic planning was also instrumental in consensus and successful
execution of the decisions made. The researcher noted that the level of communication
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about the participation and decision activity was instrumental in implementation and
execution success.
The CFLT environmental enablers for data and systems, and the behavioral
enablers for knowledge and capacity are numerous. The cross site and cross functional
nature of the CFLT provides a reach back into all organizational data, systems,
knowledge base and individual capacity that cannot be achieved individually. This
reach-back is limited only to what is available within the firm. Environmental incentives
and behavioral motives are equally strong. The incentive to participate and have your
site and function represented in strategic decision and policy making efforts is
overwhelming. Non-participation could mean a site or function having to implement
activities or decisions that adversely impact the site or function. Behavioral motivation
are individual needs and requirements being represented and considered at a strategic
level, individual needs and requirements being heard and considered were noted as
powerful motivators for consensus and successful execution.
Spares Checkbook
Of the cost tracking tools available in the company the tool referred to as a
“spares checkbook” was indicated as a potential best practice in analysis of participant
responses. Review of the literature indicates that the spares checkbook tool is used with
the Performance Based Logistics (PBL) type contracts. Although the tool observed was
manual, there were efforts under way to automate the process and associated tools.
The researcher had several opportunities to observe subject matter experts using a
spares checkbook and noted that this tool differed from the more prevalent earned value
method of cost tracking associated with traditional transaction based contracts. The
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spares checkbook was a spreadsheet based program used to track open purchase order
commitments against the budgeted cost for work scheduled.
This enabled the SME to track payment from the customer against the company’s
payment to supplier real-time, and balance that against the actual costs and scope of work
scheduled. Since PBL contracts are based on a sustained level of performance and not
the typical transactional activity in which payment is based on a hard delivery of a
product making financial calculations easy. The spares check book allows for the
manager to track the financial progress and commitments to the customer’s payment.
Ensuring that the firm is not over or under committed for the activity performed. The
researcher noted that enablers of the spares checkbook included environmental enablers
of; cross functional data, common systems, cross functional systems, and accuracy
incentives. The behavioral enablers were subject matter expertise with the systems and
knowing what data and how to obtain it.
People Development
Analysis of participant responses which suggested that subject matter expert’s
thorough knowledge of supply chain management in the literature, industry and
participation in specific supply chain management societies lead the researcher to observe
several organizational initiatives targeting people development. These initiatives were
designed to give the entire supply chain management staff the opportunity to benefit from
activities and knowledge that had historically been available to only senior members of
an organization or subject matter experts alone.
These organizational initiatives were targeted at continuous training and process
development. In both cases the focus was to take information from literature and cutting
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edge developments by recognized societies to develop a progressive training approach
that disseminated this information through the organization. The training was developed
with input from several universities which conducted frequent studies or had curriculum
specific to supply chain management. The training was progressive in nature providing
an overview of supply chain management in general for entry level staff and non-supply
chain management personnel desiring a quick introduction to the supply chain concept in
the firm. Additional training was designed to give a more in depth understanding into
specific areas of supply chain management which includes continuous updates by special
participants on new and unique concepts that the organization and supply chain experts
are pursuing.
Along with progressive training development, processes were being redesigned to
support the supply chain management approach to business support and execution. This
was deemed critical in that the new training would not be practiced or applicable if the
participants continued to do business in the previous manner.
People development had enablers in all of the behavioral engineering model cause
and effect analysis. Data was provided in a manner consistent with the training and
process redesign. Systems had been migrated to support the new requirement; incentives
were in place which changed measurement criteria in support of systems and data
presentation. The whole effort was targeted toward improving employee knowledge and
value. The expectation that increased knowledge and experience would improve personal
value in the organization leading to greater opportunities was noted as a significant
motivator for staff members. Improvements in data, systems, knowledge contributed to
increased capacity for the participants involved.
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Subject Matter Expert Development and Retention
The role of the subject matter expert was recognized by participants as an
essential contributor to the supply chain management organizations success. During the
observations and working with subject matter experts the researcher was able to group
experts into two broad categories, those experts that had specific subject, activity or tool
knowledge and those experts that had broad expertise across multiple tools, activities and
functions.
It was noted during observations that development of a subject matter expert was
something that occurred over time and was a unique combination of random opportunity
and personal motivation. It was also noted that once a subject matter expert was
identified, those that had support in developing their expertise also had greater impact
upon the organization. In cases where experts were not able to pursue additional
development, either through literature, membership in expertise aligned societies and
training opportunities, their participation and recognition was typically limited to local
sites and organizations.
Enablers of subject matter expertise are both motive and incentive. While
personal motivation attributes to achieving subject matter expert status, it was noted that
the appropriate incentives contribute to the effectiveness of a subject matter expert.
Organizational Roles in a Cross Functional Setting
The supply chain management organization was in the process of gathering
information in an effort to define its organizational role and individual site, program and
staff responsibilities. Historically organizations within the firm have been functional in
nature with individuals coming together in cross functional groups to support program
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and specific initiatives, these groups typically disband and return to the home function
once the specific task or activity is completed.
Review of the literature showed that supply chain management was cross
functional and permanent in nature. Although most of the literature used functional roles
to define specific responsibilities, the literature recognized a compelling need for the
supply chain to be governed and executed from a cross functional perspective. Review of
the literature and research into other firms that have supply chain management
organizations revealed that in most cases the organization was simply a logistics or
operations function that had adopted the new title with an expanded role and no new
relationship structure to achieve the expectations.
The researcher observed several efforts and initiatives in the firm designed to
promote and achieve a cross functional existence for the supply chain management
organization. It was noted that this was a very laborious effort for the organization,
which was essentially challenging the historical way of doing business within the firm.
The supply chain management organization defined itself by roles and capabilities. The
roles included functional responsibilities of; planning, sourcing, logistics, and product
support, with the cross functional capabilities of finance, systems, analysis & integration,
communications, human resources, training and legal.
The researcher noted in observation that the cross functional roles and
expectations of the organization were in place and those expectations were being
successfully executed. Functional “sacred cows” and territorial disputes were reviewed
and addressed by the organization as they surfaced.
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The most notable enablers of organizational roles and cross functional ability
were cross functional data, measures and systems. Employee motives were equally
strong recognizing increased personal value, more and diverse opportunities, and the
ability to capitalize on a divers experience background.
Behavioral Engineering Cause & Effect Overlay
Table 15. Case S06 BEM/C&E Cross Functional Leadership Team Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional - Comparative analysis - Triangulation - Actual
- Cross System - Common system
- Site level representation - Define system needs - Inclusion in decision process - Cost impact consideration
Knowledge Capacity Motive
Beh
avio
ral
- Knowledge base - Recognition - Development - Exposure - Networking
Table 16. Case S06 BEM/C&E Spares Checkbook Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional - Cross System - Accurate billing and status - Balanced books - Reduced use of company funds
Knowledge Capacity Motive
Beh
avio
ral
- System expertise - Where/how to find data - Understand measurement
- Too much data for manual
- Successful execution of contract and program - Only real financial Status available
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Table 17. Case S06BEM/C&E People Development Enablers Data Systems Incentive
Env
iron
men
tal
- Company university - Industry data - Company data - Societies - Universities
- Research - On-line training - Broad distribution - Compliance tracking - Track completions
- Promotion - Job security - Visibility
Knowledge Capacity Motive
Beh
avio
ral
- SME - Training - Teaching
- Increased efficiency - Encourage development - Personal value - Increased opportunity
Table 18. Case S06 BEM/C&E Subject Matter Expert Development& Retention Enablers Data Systems Incentive
Env
iron
men
tal
- Literature - Training - Education - Certification
- Online availability of data
- Exposure - Progression - Recognition
Knowledge Capacity Motive
Beh
avio
ral
- Specific experience - Years of experience - Specific exposure
- Enables cross site support - Competitive value - SME status - Organizational value - Personal value
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Table 19. Case S09 BEM/C&E Organizational Roles in Cross-functional Setting Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional measures
- Cross functional integration - Common system
- Cohesive organization - Agility - Cost effective - Efficient
Knowledge Capacity Motive
Beh
avio
ral
- Functional knowledge - Training - Experience
- Flexibility - Opportunities - Increased experience - Increased influence
Embedded Case S09 Results
Embedded case unit S09 has an organizational structure which contains the
elements typically associated with supply chain management noted in the literature, with
the exception that supply chain management activity is recorded as being distinct and
separate from these activities and capabilities. S09 contributed 7% of the subject matter
expert participation, with 93% of the semi-structured interview questions being answered
and 104% of those responses coded for analysis.
Interviews
Participant coded interview responses for Case S09 are reported below.
Describe SCM in the Firm
Participants from case S09 described supply chain management within the firm as
being:
[It is] the end to end process of organizations and personal that support the development, production, delivery development and perhaps repairs and return with transportation will and delivered to the customer.
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Another stated:
It is a start to finish process from engineering, through building the part to installation of that part on the aircraft. Then it involves managing the life cycle of that item.
Other participants made very specific distinctions between pre-sale and post-sale of a
product by describing production and product support activity as prior to and post form
DD250 which documents the formal transfer of ownership from customer to the
Government. This was noted as:
There is a distinct difference between a supply chain activity pre DD250 and post DD250 [pre/post sale/transfer of a product] in the project support function. [It] is different from production which is concerned with delivering a product to a schedule and you are maintaining your supply chain to support a certain number of quantities then you’re done once that system is delivered. [At which point] you go away. Production Support [on the other hand] is there for the life of the product.
Another participant noted specific roles expected of product support or sustainment
activity stating:
For [the] supply chain sustainment [individual] that issues a job you have to develop a plan to have in place [for the] the supply base and repair capability to maintain the level of inventories [required] to support the flying schedule of the platform.
Describe SCM in the industry
Participants described supply chain management found in the industry as:
Supply chain management is the end to end process of developing a part and delivering it to any customer including disposing of portions of it as the platform as it ages.
Measure SCM
Participants listed the measures they use or expect to use when measuring supply
chain management:
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1. “On-time delivery”
2. “Quote cycle-time”
3. “Response cycle-time”
4. “Fill rate”
5. “Invoicing cycle-time”
Describe Bench Marking
Participants in case S09 seemed very versed with benchmarking, providing
numerous examples as descriptions. One participant noted that benchmarking was more
than comparing like metrics. The participant stated:
In theory you can go to other companies and benchmark, but that is a little bit difficult since other companies may not have the same issues or requirements to deal with. If you go out and say, benchmark Sam’s, Wal-Mart, IBM, or Microsoft, you may not be comparing similar activities.
Another participant stated:
In benchmarking you really have to be careful that you are analyzing apples to apples, or similar best practices within your specific supply chain. In other words we typically do aviation supply chain work; there are other supply chains out there that might have a great best practice that is not practical for us.
Another participant described benchmarking internally as:
Looking across the company and trying to identify best practices. You go and spend time including imbedded personnel, possibly two weeks at a time with the customer and other programs and collaborate alongside management comparing tools and accuracy of data. Understanding how you gather the data and then developing a clean forecasts and a plan to go forward with.
Describe Best Practices in the Firm
Best practices in the firm are described by participants as being functional in
nature, while others described what best practice should be and what they should cover.
When describing best practice current state within the firm, one participant stated:
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So when you talk about supply chain, and I was talking about functional areas that make up the supply chain, there are best practices that might occur within any stove pipe [functional group or “silo”] of that supply chain. To my mind the real best practices and the real test is whether the practices allows the integration and flow of that stove pipe across the entire supply chain product
Another participant described best practices as more of an integrated process rather than
an executable step. The respondent stated:
A best practice is a process that incorporates a logical and efficient flow of ability and information required to produce a product with the least amount of delays and cost. [You have to ask yourself] what is that I am delivering? Am I delivering a service and a capability or am I delivering a part? What are all the flows and all of the processes that are involved? Where are all the bottlenecks and items that slow me down and do not produce or help deliver the product?
Identify Best Practices in the Firm
When asked to describe best practices within the firm participants responded by
identifying work that they were currently engaged with. Some expressed perceptions
about specific contracts they were working on, and how they could improve those
contracts. Others identified best practices by referencing certain measures that showed
improved performance. In one response the participant noted how they would go about
“finding” best practices to use.
Respondents provided feedback based on current activity by stating:
We jointly worked together to modify our contracts to make that contract the best in class contract for those systems supported by that contract. So [the contracts that we create] gradually evolve until we [believe] we have a best in class contract, which I would say is kind of a best practice.
In some cases subject matter experts worked at the behest of customer representatives to
develop best practices approaches. One example was:
The defense logistics agency is doing this new depot level repairable acquisition process which is a new area of responsibility for them and they want us to participate and show “how we can do this activity better.”
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Another example of best practices was:
[We have] transitioned all material that was government furnished to contractor furnished. Specifically consumables and those types of parts required for maintenance that are considered rotatable-bin stock. [Screws, glues and goo in contrast to assemblies and fabricated parts] We had to go through years of data to identify what the actual items to be included, looking at maintenance data being performed on the aircraft today and a lot of data cleansing. From that we came up with a concept. This approach helped us keep the cost of the inventories carrying levels down. Allowing for acceptable levels to supplier management and allowed us to project man-power requirements across the programs reducing the lead time of parts.
Participants indicated that within the firm there were avenues for finding and identifying
best practices for consideration, stating:
To find a best practice I would go into the firm’s web site identify the best practices that currently exist pull those down and try to use those. See if they can interface or be incorporated into my processes.
Participants also noted that best practices should meet preexisting criteria, stating:
There should be some standards for work processes and your practice should be in compliance with these if that company has put them out there.
While others stated: You need to continually strive for more efficiencies, better support and better value.
Additional comments were:
Something that has standardized and is best for that company and the customer.
While another participant noted that when they suggested a best practice, they had
evidence of performance, stating:
The information and data that we had proved that this was a best practice [and has been] validated by an outside organization that reviewed the information.
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Another participant noted:
A best practice, actually, it’s a changing thing… right. So a best practice identifies a process or a contract style, or a management technique that has been proven across industry to provide the best most predictive, cost effective support.
Yet another indicated that cost considerations were main factors and results should be
validated stating:
I think you know you have a best practice whenever you have the price of your product or work in the item that you are delivering considered of value [to] two more customer[s]. And a schedule in which you are able to deliver [your product] and meet their needs. {It should be] acknowledged [as such] and you are tracking your cost to produce and tracking [your on-time] delivery to the customer.
Measure Best Practices
Participants provided the following list of best practice measures:
1. “Measures of economic profit”
2. “Fill rate”
3. “Efficiency”
4. “Inventory turn”
5. “Company funds impact”
6. “Customer satisfaction”
7. “Percentage of sole source follow-on contracts”
8. “Timeliness”
9. “Quality”
10. “Compliance”
11. “Process improvement”
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Organizational Strength
Participant responses in providing examples of organizational strengths as
opportunities for observation for case S09 included examples of communication best
practices, as well as contract and forecasting best practices.
Participants indicated that customer and stakeholder participation were recognized as
critical to the success of the site stating:
By capitalizing on our process and supply base optimization program we have created what we have been told is a best practice. We meet monthly with our customer and stakeholders and go through their concerns and issues and we develop a reaction plan for the following months meeting to respond to their issues. They [view] this [as] a critical success factor for the program. Process optimization activity and we are told it is a best practice. [We also do] lunch and learns with the customer and strengthened communication with the customers and production.
Additional opportunities for observations included contract and support activity:
We bring experience to the Contractor Logistics Support world. Specifically with information and strong service knowledge in contracts specific to logistics, our experienced and knowledge is our strength.
Forecasting was also noted as a best practice opportunity: Forecasting projections and information sharing [create a] close relationship with the customer [and helps us] produces new products for them and provides a service for them which is what they what; not what we want to sell but what they are asking for. Forecasting is a key factor to our success.
Observations
Opportunities for observation in S09 identified by the participants include certain
contract types, customer and stakeholder participation and forecasting.
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Contracts
In analyzing participants’ responses to identify opportunities for observation the
researcher noted that Contractor Logistics Support type contracts were noted by
participants as potentially best practices. Contractor Logistic Support (CLS) contracts
emphasize supplying support activity, including management of the prime contractors
supply chain.
CLS contracts are logistics support contracts which require that a contractor
provide material, facilities and services in the areas of supply and distribution,
maintenance, spares and repair activities, all at the depot level. Some contracts also
include software support and integration as well as training solutions and support.
In reviewing the literature associated with these types of contracts and observing
subject matter expert explanation and execution of CLS contracts the researcher noted
that a significant contributor to the success of these contracts was the data used to plan,
propose and execute them. It was also noted that these types of contracts tended towards
support types of efforts, or what participants described as post sale of product efforts.
Profit maximization was maintained by accurately projecting product failure rates and
planning either replacement or repair activity in the most efficient and cost effective
manner.
As stated the enablers for these types of contracts are the data that are used to plan
or forecast requirements needed to maintain the specified performance levels. It was
noted that there were several systems used in performance of these contracts, but the
integrity of the data was paramount. Knowledge of where data can be located or mined
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and the ability to understand how the data should look and what levels of performance
are actually achievable are necessary in establishing or negotiating the initial contracts.
Customer and Stakeholder Participation
Additional areas for observation case S09 were the area of customer and
stakeholder participation. The most evident area of customer and stakeholder
participation was in formalized team meetings. These took various forms. The
researcher observed several customer and stakeholder communication session including
several product teams which included all parties, Program Management Reviews,
Quarterly Performance Reviews and Strategic Initiative Teams.
In all cases these teams were formalized and had guiding charters, descriptions
and boundaries. These teams included representatives from the customer and all
functional roles involved in the project or product. Active participation was expected and
encouraged. The most significant area of interest to the researcher was the group’s
constant maintenance of action items from all parties. In most cases there was a formal
approach to documenting actions as they arose during the session, review of noted actions
and consensus regarding ownership and responsibility of the assigned action at the end of
each session. Action items were the first topic of discussion at each meeting and it was
expected that actions due were completed, short explanation presented and the group
moved forward with the balance of the session.
The researcher noted that when actions were handled in this manner, there was an
atmosphere of cooperation, trust, and progress. If actions were not treated as important,
the atmosphere in the sessions was less cooperative and trust seemed non-existent.
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Another observed significant contributor to customer and stakeholder
participation was frequent non formal communication with peers. When team members
maintained contact with customers and stakeholders outside the formal process it was
noted that relationships were more developed and for the few problems that arose, these
were handled in a more cooperative manner.
Analysis noted that each meeting had enablers from various behavioral and
environmental categories, with the most significant and consistent being the enablers of
incentive and motive. The incentives for customer and stake-holder participation
included greater influence over decisions, fewer miscommunications and
misunderstandings, increased visibility into trends and predictive indicators of impacts,
and risk sharing. The category of motive for customer and stake-holder participation
included buy-in, no surprises, greater consensus, and support for decision, increased
acceptance of performance reporting and in some cases visibly improved performance
scoring.
Forecasting
Several participants indicated that forecasting or modeling of demand was a best
practice. Forecasting is the process of understanding customer usage in a manner that
allows the firm to predict future customer demand. Forecasting is used to lower costs and
improves supply chain responsiveness. Forecasting was described by the subject matter
experts as the nexus of support type contracts and services. By reducing inventory and
improving system responsiveness to the customer forecasting has significant impact on
overall costs and competitive advantage.
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Crucial to forecasting are the conditions under which a contract or program is
supporting and the integrity of the data put into the forecasting models. If data is not
accurate, then there is a tendency to put buffers into each execution step. As these
execution points react to demand and try to maintain their buffer or safety stock level a
phenomenon known as the bullwhip effect occurs, essentially creating a reaction that
compounds and exacerbates the safety stock levels at each execution point.
After reviewing several forecasting models in the literature and observing several
subject matter experts using forecasting models in the firm, it was noted that there are
multiple forecasting models that are available to the firm and currently in use in the firm.
The tool of use was less of a factor of success and effectiveness than the quality of the
data used.
Behavioral Engineering Cause & Effect Overlay
Table 20. Case S09 BEM/C&E Contracts Enablers Data Systems Incentive
Env
iron
men
tal
- Availability - Accuracy
- Cross functional integration - Forecasting
- Increased profit - Measure accuracy - Long term tie to customer - Cross platform support - Customer need - Funding
Knowledge Capacity Motive
Beh
avio
ral - Training
- Experience - Value
- Exposure
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Table 21. Case S09 BEM/C&E Customer and Stakeholder Participation Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional data - Predictive indicators
- Common system - Common access
- Influence decisions - Views, issues, concerns addressed - Improved communication - Improved visibility - Increased risk sharing
Knowledge Capacity Motive
Beh
avio
ral
- Buy-in - No surprises - Consensus - Improved performance rating. - Improved relationships - Less animosity
Table 22. Case S09 BEM/C&E Forecasting Enablers Data Systems Incentive
Env
iron
men
tal
- Clear data - Accuracy - Cross functional data - Integrity of data - Availability
- COTS - Statistical forecasting - Spares analysis - Tactical work load
- Negotiate contract types - Project costs - Project staffing - Win contracts - Lower investment - Leverage buying
Knowledge Capacity Motive
Beh
avio
ral
- SME - Previous military logistics experience - Knowledge of system
- Project capacity
- SME certification
Embedded Case S10 Results
Embedded case unit S10 has an organizational structure that is product or
program oriented in nature. S10 separates supply chain management into distinct
groupings of production orientation and product support orientation, separating the
“chain” by the product sale demarcation line. S10 also reports supplier management as
separate from supply chain management.
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Embedded case S10 contributed 7% of the overall subject matter expert
participation. Subject matter experts in case S10 responded to 90% of the semi-
structured interview questions with 111% of the responses being coded for analysis.
Interviews
Participant coded interview responses for Case S01 are reported below.
Describe SCM in the Firm
Participants described supply chain management in the firm as including:
The management of those tools and processes to make sure that all the requirements were met to deliver that product or service to our customer.
Another participant stated:
[A] supply chain puts into place the checks and balances to ensure things are what they should be. [It involves] getting the part to me that I need to get on the airplane.
Yet another stated:
The supply chain also includes our air logistic centers (customer), depots.
Several participants noted that pre and post product sale as being separate and distinct
stating:
Coordinating and getting the people in the right job, reviewing skills, posting requisitions etc. It involves career development, review of processes to establish metrics across all sites. Supply chain management includes command media review and reductions to move to common processes across all sites. [As and example] product Support is a function under engineering which is responsible for all logistics, field services, tech publishing, product support, and integrated logistics.
One responded specific to production or pre-product sale activity stating:
Now if you’re in operations [production] it’s getting all the materials required to manufacture or produce a product and to move or the logistics of a product.
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Another respondent noted:
In the supply support organization supply chain covers anything with getting parts, moving the parts, information regarding parts and the acquisition of parts, not only parts but also other items such as support equipment and test equipment.
Describe SCM in the industry
Descriptions of supply chain management in the industry included describing supply
chain management as:
Groups of people, processes, tools, and information involved in actually the cradle to grave of a product or a service to our customer.
Another stated that supply chain management is:
The organization or the entity that would supply the parts that I need for the activity I am trying to execute in a timely fashion to meet my schedule, of the highest quality.
The researcher noted that no reference to pre or post supply chain was stated for supply
chain management in the industry.
Identify SCM in the Firm
Participant’s responses in identifying supply chain management in the firm were focused
on specific activities. Several equated supply chain management with contract types,
stating:
We were a performance logistics type contract. Everyone else is mostly a transactional type of contract [delivery of product vs. a service], we’re beyond that. We are on contract to provide or model material requirements for the product based on the length of the contract and the use of the product. Using the number of flying hours, we model [material need] to determine what we are going to go buy.
Another stated:
Post DD250 and Pre DD250 [pos/pre sale/transfer of product] supply chains differ, on a PBL we do not use a DD250, we use DD1348, and we are paid on issue effectiveness metrics. We don’t do a one for one accounting, we disclose in
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our earned value management reporting what we are spending to the customer. We do not have a transactional type of environment.
Measure SCM
Measures of supply chain management were noted as:
1. “Cost”
2. “Time”
3. “Customer satisfaction”
4. “Effectiveness”
5. “Fill rate”
6. “Effectiveness on reparable/recoverable items”
Describe Bench Marking
Participants stated that benchmarking was done by:
Looking at all the site metrics and see if there is consistency in a metric then I would do an evaluation at that site and look for replication opportunities for other sites.
Another participant suggested that:
You can benchmark other platforms and companies to try and figure out what everyone else is doing and steal shamelessly. Incorporate that into your own process for improvement. Take things from other processes and add them to your own to make your processes perform better or exceed the competitions performance.
Another participant indicated that in the firm:
We share information; other companies are benchmarking and continuing to improve.
Identify Best Practice in the Firm
Participants suggest several ways to identify practices as best. One participant
noted:
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A best practice is one that the customer has repeatedly stated or provided feedback stating that this [specific activity] has consistently meet their needs, or [has] exceeded their needs.
Other ways of identifying best practices include:
We had a consultant firm come in and review our policies and procedures and do a gap analysis to see if we were a best practice. Because we needed to find out if we were really as good as we thought we were.
Another participant suggested:
There is a process, procedure or method, that gets the best results, whether you are looking for efficiency, high quality, lowest cost, it’s the best in the industry. A best practice is what you desire to be for your organization, department or group.
Measure Best Practice
Ways to measure best practices included:
1. “Comparative analysis”
2. “Measures of timeliness”
3. “Efficiency”
4. “Cycle-time”
Organizational Strength
There were several organizational strengths noted by the participants. One
suggestion was:
The analysis of [tooling] use and the maintenance requirements [is an organizational strength]. We want to avoid creating tools specific for programs and are asking [those programs] to review what is available already and see if something that exists can be used or modified instead of creating something new that has to be tracked and maintained.
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Another participant stated:
A core competency was performance forecasting. We are able to take the requirements and the length of the program and determine what the requirements will be for that duration. Then we are able to maximize the dollars by purchasing in advance what is needed and having it available for need. It is our model that allows us to do this.
Observations
Case S10 identified forecasting as a best practice. S10 uses an off the shelf
forecasting tools which requires cost, requirements, cycle time and usage data. Case S10
also suggested tool tracking as a potential best practice.
Forecasting and Modeling
The forecasting and modeling tool observed was similar to the one used in a
previous observation. As with the previous observation the data quality and quantity was
a critical factor for success. Site S10 was in the process of creating a standardized
approach for “data cleansing.” The subject matter expert spent some time explaining the
measures typically used in forecasting. This health or accuracy measure was Mean
Absolute Percentage Error (MAPE) which is a calculation of forecast demand and actual
demand. The subject matter expert explained that a root cause analysis of the gap
between these two figures tends to be the completeness of the data used to conduct the
initial forecast. The process in work would address that gap and root cause.
Tool Tracking
During the observation the researcher was made aware by the subject matter
expert that tooling was a significant cost factor for the firm and programs. Tooling in
general consists of all hard and soft products that assist in the fabrication, repair, and
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maintenance of a product. This would include hard fixtures, templates, forms, and in
software programs. The firm estimates that a significant percentage of the tools which
the firm fabricates internally, purchases or leases, or funds for a supplier to build are
redundant and repetitive. Compounding this cost impact are tools which are in need of
repair or not up to the current configuration requirements. Cost impacts to quality and
scrap costs due to “faulty” tooling are unknown.
The firm and specifically the subject matter expert were involved in identifying a
single data base in which all tooling information would be compiled. This would enable
an interested party to research across business units, programs and functions for existing
tooling. Indicating when and how that tooling had been evaluated for conformance and
where the tool was located and when the tool could be available. This would include
tooling that was resident at suppliers and customers.
The subject matter expert was also involved in creating a standard approach to
managing this data base and the tooling it would “control.”
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Behavioral Engineering Cause & Effect Overlay
Table 23. Case S10 BEM/C&E Forecasting Enablers Data Systems Incentive
Env
iron
men
tal
- Clear data - Accuracy - MTBF - Total flying hours - Cross functional data - Integrity of data - Availability - Drive ROQ
- COTS - Homegrown - Statistical forecasting - Spares analysis - Tactical work load -
- Negotiate contract types - Project costs - Project staffing - Win contracts - Lower investment - Leverage buying
Knowledge Capacity Motive
Beh
avio
ral
- SME - Previous military logistics experience - Knowledge of system
- Project capacity
- SME certification
Table 24. Case S10 BEM/C&E Tool Tracking Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional - Easily identifiable - Accurate - Availability - Maintained
- Common system - Common access
- Reduce program cost - Improve program schedule - Ease of location and tracking
Knowledge Capacity Motive
Beh
avio
ral
- Use of system - Application of tool
- Too cumbersome to do manually - Too large a database
- Makes the job easier
Embedded Case S12 Results
Embedded case unit S12 has an organizational structure based solely on a product
support representation of supply chain management. S12 contributed 4% of the subject
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matter expert responses with 70% of the semi-structured interview questions receiving
responses. 70% of the participant responses were coded for analysis.
Interviews
Participant coded interview responses for Case S12 are reported below.
Describe SCM in the industry
Participants described supply chain management in the industry stating that it
includes:
Manufacturing the product and delivering the product to the customer. It starts with providing or procuring the materials necessary to produce a product delivering the product and then making the product available for use.
Measure SCM
Supply chain measures included:
1. “On-time proposal delivery”
2. “On-time product delivery”
3. “Delinquency tracking”
One participant described the rating system for supply chain management measures as:
Need to various metrics (based on business) that have specific goals, with (Minimum Allowable Level) MAL, (red) & Exceed Goal (blue).
Describe Bench Marking
Participants described benchmarking by stating:
You study and replicate what the competition does, but at the same time I think that we do this in the company, and we do this across different functions and different businesses. There is a constant study or reevaluation of what you have to determine if they are best practices, while always trying to improve. It is a continuous cycle.
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Identify Best Practices in the Firm
Participants described identification of best practices in the firm as a suit of tools,
stating:
Best practices are identified by reviewing opportunity, issues and risks.
Describe Best Practices in the industry
Participants described best practices in the industry by stating:
In the simplest terms is a method, or a process that you can [use to] achieve repeatable results. It is a repeatable process that produces favorable results.
Measure Best Practices
Measures of best practices were noted as:
1. “Cost reduction”
2. “Quality”
3. “Timeliness”
Organizational Strength
Participants indicated that potential best practices were:
We had our entire Supply Chain team as one group, (Spares gurus, SM&P coordinator, ME Planner, Finance, Hardware management, tooling expert) co-located and function as a team. By co-locating everyone, I was able to reduce proposal flow time from 45 - 50 day average to less than 20.
Observations
Cell Workgroup Concept
The researcher observed a work group setting referred to as a cell, or cell working
group. The cell working group concept was a product of a cross functional employee
involvement team identifying opportunities for improvement within their extended group.
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This team noted that significant time was lost and miscommunication occurred between
the functions involved with crating proposals for potential contracts specific to the site.
The resulting process improvement suggestion was to co-locate the work group and set
up workstations in a manner that followed the flow of activity. In this manner the work
could literally be “handed” to the next functional representative in line. This cell activity
included both the initial transactional and information activity followed by the physical
activity. This enabled instant cross functional communication and representation of each
group in decision making situations that they would not have been exposed to in other
settings.
As noted in the participant’s coded responses, co-location of the group
significantly reduced proposal cycle-times. The research noted that the main area of
reduction had to do with understanding information provided by functions. This data was
discussed in an open environment which contributed to clearer understand of the data
provided. When there were questions that arose, they were dealt with immediately by the
person responsible. This eliminated the normal practice of meeting several times a week
to review action items. Any actions that arose, were dealt with on the spot.
The researcher also noted that by co-locating the group there was a common sense of
urgency on proposals as well as a common sense of purpose and group cohesiveness that
did not exist when the functions were separated.
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Behavioral Engineering Cause & Effect Overlay
Table 25. Case S12 BEM/C&E Cell Concept Enablers Data Systems Incentive
Env
iron
men
tal
- Quick flow of data - immediate query for clarification
- Improved cycle time - Improved understanding - Improved quality - Improved cohesiveness
Knowledge Capacity Motive
Beh
avio
ral
- Cross functional access - Reach back to adjacent functions
- Single focus - Less down time
- Improved cross functional relationship - Smaller working group - Instant access to support
Embedded Case S13 Results
Embedded case unit S13 has an organizational structure which reflects activities
in supplier management with no other supply chain management activities referenced.
S13 contributed 2% of the subject matter expert participation responses, with 60% of the
semi-structured interview questions receiving responses. 50% of the participant
responses were coded for analysis.
Interviews
Participant coded interview responses for Case S13 are reported below.
Describe SCM in the Firm
Participants at case S13 described supply chain management in the firm as
consisting of the following activities:
When customer requires a spare/repair part or retrofit part for a particular aircraft, requests a proposal, awaited/receiving a bid and then placing an order and awaited the part’s arrival.
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Describe SCM in the industry
Participants describe supply chain management in the industry as:
Having the right part in the right place at the right time
Describe Best Practices in the Firm
Participants stated that best practices in the firm include:
Techniques/processes/methodologies that produce superior results, selected by a process, that can be scored or successfully demonstrated and can be adapted.
Identify Best Practices in the Firm
Participant’s perceptions of methods for identifying best practices included:
[For identifying best practices] if you have continued process improvements, then chance's are that you could have a best practice.
Observations
Site S13 expressed a desire not to participate in the observational portion of the
study.
Embedded Case S16 Results
Embedded case unit S16 has an organizational structure which includes supplier
management and a supply chain management group which includes; product support,
forecasting, production control, and property management.
Results for embedded case unit S16 showed that this unit contributed 7% of the
subject matter expert responses answering 83% of the semi-structured interview
questions and having 120% of those responses coded for analysis.
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Interviews
Participant coded interview responses for Case S16 are reported below.
Describe SCM in the Firm
Participants described supply chain management within the firm in a manner
consistent with what the researcher found in literature. Respondents stated:
It is a wide definition that depends on what kind of product or service [it] is you are providing. Supply chain covers anything that deals with getting parts moving those parts distribution [and] acquisition. Not just parts but also support equipment we have a large supplier base will we consider part of our team.
Another participant noted the extended nature of supply chain management stating:
The supply chain also includes the customer depots. If you’re in operations [production] then [the] supply chain gets you all the materials you need to manufacture a product and to move the product [including] the logistics of that.
Other participants noted that supply chain management was more than just the physical
functions and product, but extended to other areas by noting:
Supply has to do all the budgeting, customer satisfaction, you know so there are a lot of different activities in supply chain other than just getting material.
Another participant continued the theme stating:
Supply chain management includes managing your cost accounts, and managing internal systems to do forecasting and all those types of tasks that we do in order to share the requirements with our suppliers so that they know what our future requirements are. It includes communication with engineering, drawing changes and revisions. All those things start out internally in the roots and then communicate up.
Describe SCM in the industry
On participant described supply chain management in the industry in the
following manner:
It is the cradle to grave acquisition of parts or the process. It is different organizations different functions different groups and how each of these
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organizations connects with the other, whether it is procurement and transportation or procurement and the customer, or procurement and the suppliers, it is basically the whole chain.
Measure SCM
Participants indicated that supply chain management was measured by:
1. “On-time delivery”
2. “Cycle-time”
3. “Inventory cost reductions”
4. “Procurement grief metrics”
5. “Diverse supplier rating”
6. “Affordability”
7. “Efficiency”
8. “Effectiveness”
Describe Bench Marking
Participants described benchmarking in the following manner:
I would start with the employee involvement team and run it against my peers; you look at cost savings, [and] look at what the previous practice was. [Look at] what the proposed is and any cost savings that might be a realized.
Another participant stated:
Companies are continuing to benchmark. Trying to catch up with each other and pushing the envelope. They do outside analysis, by doing a gap analysis to determine if we are best in class.
Describe Best Practices in the Firm
Participants provided the following descriptions of best practices in the firm. One
participant stated:
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It is a practice that gives the program a competitive advantage over the competition, regardless of the program or function. It doesn’t have to be a best practice across the entire organization; it just needs to be common across the specific phase or life cycle in which it occurs.
Another participant stated:
It is part of the review process when you are doing a review and you see a trend. It’s something that we need to look at to achieve better results. By looking at metrics we’re able to gather that information.
Describe Best Practices in the industry
Descriptions of industry best practices were provided by subject matter experts
who stated that an industry best practice is a:
[A] process or a procedure or a technique that gets the best results whether you’re looking for quality, lowest cost [or] best schedule performance.
BP Suggestion
Case S16 participants provide numerous suggestions of best practices.
Participants stated:
Modeling projected needs based on customer input and product performance [is a best practice]. We analyze our models each year and determine what we’re going to go buy in each year. We generate our own requirement to meet aircraft availability [needs].
Another participant elaborated further stating:
A best practice is something like being able to screen demand in order to gain competitive advantage over another companies proposal. Being able to do what your competition can not do is a best practice.
One participant noted a specific best practice activity:
We have employee involvement and we look at different practices that we have and the ways in which we can better those practices while still meeting our objectives. Whether [the activity is] getting parts in a timely manner or finding a smoother way of processing our purchase orders or finding the best way to support systems integrity.
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Several participants noted that some activities labeled as best practices might not be
“best” stating:
The programs that we own are all in different phases but we continue to try to make them all common. Sustainment data system folks try to develop a line of balance program or a logical bill of material theory. We don’t need to make things conform that don’t really work that way.
Another stated:
Our current best practices are “logical” best practices but I feel [that] if you’re not doing these [labeled best practices as routine business] then you can’t execute on a program. These are routine practices that you need to be doing anyway. They are not [what I would call] best practices.
Measure Best Practices
Participants listed the following measures of best practices:
1. “Competitive advantage”
2. “Efficiency”
3. “Effectiveness”
Organizational Strength
The following are the organizations strengths suggested by the subject matter
experts as opportunities for observation and potential best practices. Participants stated:
By allowing us to control our own destiny, by using our own forecasting tools, our own methodology to determine what materials we will need in the future and when we need it is a best practice in support of the program.
Another stated:
Our formalized employee involvement is definitely one of those strong points. Looking at daily activities gives them, [the employee] a venue to view tasks they do on a day to day basis.
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Yet another noted:
[Our] core competency [is] performance spares requirements forecasting. Forecasting the requirement accurately so that we can make purchases and repairs and timely manner with minimal cost is a best practice. It allows us to maximize the benefit of dollars allocated for an effort.
Observations
Opportunities for observation in case S16 included forecasting and employee
involvement activities. These were reported by the participants interviewed as potential
best practices.
Forecasting
Case S16 uses similar forecasting tools as previously reviewed sites and provides
forecasting as an example of one of their best practices. The forecasting tool is an off the
shelf product which requires product usage, product availability, part lead-time, and
repair and purchase activity cycle-times. Forecasting techniques and approaches to data
cleansing and quality was developed in the cross functional leadership team.
Employee Involvement
The concept of Employee Involvement (EI) is not unique to the firm. Employee
involvement is a management practice which uses empowerment and trust to increase
employee commitment and acceptance to objectives within the firm and consensus and
participation for performance improvement activities. Employee involvement is simply a
structured group of employees, a natural work group or cross functional team that has
been empowered and provided the tools necessary to analyze current activity identify
opportunities for improvement and authorized to initiate the necessary steps to effect
change.
145
The team the researcher observed was a natural work group that had created a
team charter, established roles within the team and established boundaries within which
the team would operate. The firm provided the necessary training and tools to support
the team along with an independent facilitator to help the team remain focused on the
chosen task.
At the time of observation the team was in the process of identifying areas of
opportunity. This consisted of reviewing a previously created departmental value stream
map, and noting areas of potential bottlenecks, or process breakdowns known as “star
bursts.” Once a starburst was selected the team would analyze the starburst and design a
process improvement. These process improvements were reviewed by the team sponsor
and if sufficient return on investment, or cost avoidance data was provided and validated
the improvement was authorized and the team would then set about implementing the
improvement.
Review of the literature within the firm noted that significant process
improvements and cost saving had been realized through the use of EI teams within the
firm.
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Behavioral Engineering Cause & Effect Overlay
Table 26. Case S16 BEM/C&E Employee Involvement Enablers Data Systems Incentive
Env
iron
men
tal
- Value stream mapping - Gap analysis
- Improved performance - Reduced costs - Improved trust - Increased commitment - Objectives obtained - Consensus - Acceptance of objectives
Knowledge Capacity Motive
Beh
avio
ral
- Current process - Process improvement techniques - Problem analysis techniques
- Quicker flow improves capacity
- Improves work flow - Smarter not harder - Improved value
Table 27. Case S16 BEM/C&E Forecasting Enablers Data Systems Incentive
Env
iron
men
tal
- Clear data - Accuracy - Cross functional data - Integrity of data - Availability
- COTS - Statistical forecasting - Spares analysis - Tactical work load -
- Negotiate contract types - Project costs - Project staffing - Win contracts - Lower investment - Leverage buying
Knowledge Capacity Motive
Beh
avio
ral
- SME - Knowledge of data - Knowledge of system
- Project capacity
- SME certification - Increased organizational value - Increased mobility
Embedded Case S20 Results
Embedded case S20 has an organizational structure that includes the functional
roles of supplier management and warehousing. Product support activities are referenced
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as a separate organizational function, independent of the supply chain management
organization.
S20 contributed 7% of the subject matter participation. Subject matter experts
responded to 70% of the semi-structured interview questions with 110% of those
responses being coded for analysis.
Interviews
A summary of subject matter expert coded interview responses are recorded
below.
Describe SCM in the Firm
The following is a compilation of participant responses describing supply chain
management within the firm. Participants stated:
It’s more of a focus on flows, you have three basic flows; material, information, and financial data.
Another participant stated: Supply chain management manages the flow of product, the information and the financials. Supply chain management coordinates the flow of all the processes from raw material inventoried, control and delivery.
Yet another noted specific functions in the supply chain stating:
Engineering might not normally be thought of as part of the supply chain but it really is. They’re the ones that designed the parts. Then you have the requirements people that dropped the requirements they are part of the supply chain management portion as well. Tracking the cost of the product managing the cost of manufacturing and delivery would be the finance people.
Describe SCM in the industry
One participant described supply chain management in the industry as:
Supply chain is all the things that happen in the life of a product or service, from supplier to distribution to warehousing to retailing. Everything that happens for
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the requirements from the supplier all the way through the time that it is installed.
Describe Bench Marking
Benchmarking was described by participants as:
Take the environment that you are working in and define your process; find an equivalent process that has better results. Check in libraries or word of mouth, by querying subject matter experts that you have networked with.
Another participant stated:
See how your process compares against other processes that will perform a similar task. Does the process allow you to do the same task in a more efficient way then you have benchmarked a best practice.
Identify Best Practice in the industry
When asked how they identify best practices in the industry participants
responded:
We find this out through constant scanning and interaction with other groups we meet in seminars etc.
Another described a best practice as:
A process a technique that has been proven to have added value to the product
Yet another noted that there is an inherent criterion that best practices have to meet,
stating:
It’s proven to do those things on one product but has applications to other products.
Identify Best Practices in the Firm
Participants identified specific practices within the firm which they felt were best
in class, or best practices. Participants stated:
The group that we have now excels in communication and cooperation and this is partially due to our tools. We use the [personal and group dynamics] tool and what this tool does, is provide a check list of what types of reactions, strengths
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and weaknesses each individual has and provides a guideline, communication mentor, that describes how to communication and work with the specific personality that you are working with.
Another participant stated:
Cross Functional Leadership Teams are a way to ensure that we are communicating best practices across sites and functions.
Yet another stated:
Having engineering integrated with the repairs support and logistics effort is a best practice.
Measure Best Practices
One participant summed up best practices measures stating:
It’s repeatable and it shows superior results and other people tend to seek it out because of the results that it produces.
Organizational Strength
Several subject matter experts pointed out areas of organizational strength which
they felt were candidates for observation as potential best practices. Participants stated:
Our performance measures are a best practice. We have the ability to use our normal performance measures in a predictive fashion.
Another participant stated:
Our approach to communication and cooperation are a best practice. Not all organizations have our level of interaction. This is not measured. It simply results in fewer roadblocks
Another subject matter expert noted:
We’ve developed a new tool that allows our customer to project cost savings by addressing certain support, or procurement requirements. This tool notes the current costs of an item or activity and projects savings.
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Observations
The following observations were made by the researcher. The potential best
practices observed were performance measures, personal and group dynamics, cell
concept working groups and a return on investment forecasting tool.
Performance Measures
When discussing performance measures the majority of respondents stated that
predictive indicators should be considered as an observational opportunity. The
researcher analyzed the literature with regard to measures that were used not only to
measure current performance but were also used as predictors of future performance.
The researcher was able to observe several of these predictive measures in use by subject
matter experts.
It was noted during observations that no single measure was used in this role. In
all cases there were several indicators, or what the subject matter experts referred to as
suite of indicators which when used together had greater accuracy in predicting future
performance. In each of the observations the researcher noted that the more measures
that subject matter experts included in their “suite” the more reliable the predictive
indicators became.
In reviewing supplier management’s suite of predictive measures, this consisted
of actual performance that was measured with in both quantitative and qualitative
measures, in multiple performance areas. These measures were then compiled together to
create an aggregate performance measure that was a key factor in selecting sources for
future contract awards. The more data that was available the clearer performance trends
became and a clearer picture into possible future performance.
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Enablers for predictive measures include data, systems, knowledge and motive.
All measures rely on certain data input. For predictive indicators the integrated systems
allowed for more data to be recorded and collected which also led to increased capacity
for the user. Knowledge of how the systems worked and how the predictive indicators
were used increased employee use and participation both an incentive, ease of use, and a
motivator, higher probability of success.
Personal and Group Dynamics
Personal and group dynamics was a subject that appeared in various forms during
the analysis of the coded responses. At various levels participants indicated that the
dynamics within a group had some affect over the success of the groups purpose. During
one observation the researcher was able to observe group communication in a conscious
and intentional manner with regard to awareness of personal interaction preferences. At
certain levels within the company training and assessments are conducted into the
individual’s personality structure and preference. These personality assessments are
strictly individual, guiding the participant assessed in the forms of communication and
interaction that they are most comfortable with, and giving guidance on how to deal with
personality traits that they may be uncomfortable with.
In this observation the researcher witnessed a group that not only had individual
personality assessment awareness, but had visibility into the other participant’s personal
assessment as well. This created a communication environment where participants
consciously communicated in the manner that best fit the audience or person in question.
The result was powerful, a team in which the communication was quick and efficient
with minimal personality disruptions and in which consensus seemed to be reached
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quickly and effectively. The researcher noted that this team was populated by subject
matter experts and had been in a team unit for more than 12 months.
The cause and effect analysis shows that the majority of the enablers fell within
environmental data and incentives and behavioral knowledge and motives. The group
had the data available concerning each participant and the knowledge of how to use the
data provided. Incentives included group participation and management concurrence.
Motive factors were quick and concise communication and being addressed in the
manner in which the participant most preferred.
ROI Forecast
In conjunction with forecasting models the researcher observed a tool developed
on a local level, the [Return on Investment Forecast (ROIF) model] which includes a
Return on Investment (ROI) calculation. ROIF used 10 years worth of historical
governmental source data from financial, logistics, inventory, operating, and systems data
bases to project sustainment costs from a platform level down to an individual part level.
By targeting specific improvements total sustainment cost reductions were calculated.
This tool was designed to take current usage, failure rate and cost data to project
predicted costs over a period of time. Using current pricing data based on a leveraged
buy, or a reduced cost for quantity. The subject matter expert could forecast replacing
and part/service availability showing a significant cost savings if potential future failures
were addressed at the present time.
As with forecasting models and tools it is the integrity and thoroughness of the
data mining effort that enables ROI forecast accuracy. The cause and effect analysis
results were heavily environmental in nature. Data and systems were key causes for
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success or failure of this activity, with subject matter expert knowledge also noted as
critical to the success of the original data mining effort. It was this behavioral knowledge
that led to the correct data bases.
Behavioral Engineering Cause & Effect Overlay
Table 28. Case S20 BEM/C&E Performance Measures Enablers Data Systems Incentive
Env
iron
men
tal
- SME evaluation - Cross functional evaluation - Cross program evaluation - Cross company evaluation - Actual performance
- Supplier access - Common system - Common access - Cross platform
- Improved performance - Improved relationship
Knowledge Capacity Motive
Beh
avio
ral
- Training on use and expectations - Too much to do manually - Too difficult to coordinate manually
- Success in position
Table 29. Case S20 BEM/C&E Personal/Group Dynamic Enablers Data Systems Incentive
Env
iron
men
tal
- Personal profile - Group profile - Teammate profiles
- Improved communication - Improved team performance - Short effective team meetings - Group participation - Consensus decisions
Knowledge Capacity Motive
Beh
avio
ral
- How to use and interpret the tools - What communication techniques are applicable
- Improved capacity due to addressing miscommunication
- Personal understanding - Everyone get along - No dominants - Value to team
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Table 30. Case S20 BEM/C&E ROIF Enablers Data Systems Incentive
Env
iron
men
tal
- Accuracy - Availability
- Access - Contract potential - Cost savings - Cost avoidance - Capacity planning - Investment planning
Knowledge Capacity Motive
Beh
avio
ral
- Develop system - Data mining points - Intuitive accuracy - Experience
- Value - SME Status - Single point failure
Embedded Case S30 Results
Embedded case unit S30 has an organizational structure which includes the
functional roles of forecasting, product support, supply support, and warehousing.
S30 contributed 9% of the subject matter expert participation who responded to 90% of
the semi-structured interview questions with 111% of those responses being coded for
analysis. Subject matter expert responses are recorded below.
Describe SCM in the Firm
Participants described supply chain management within the firm stating:
Supply chain management is managing all of the different areas, the processes, people and tools required to do the definition, build, delivery, and execution and disposal. It’s also working across multiple disciplines, such as engineering, finance, operations, quality, providing an integrated solution for all the other functional elements.
Another participant stated:
Strategically supply chain management is looking to the future to determine where we will be in 5 or 10 years. Where will the supply chain business be in that time. Tactically are we executing the existing programs, providing leadership? Supply chain management is a matrix organization.
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Another participant noted:
Supply chain management would be the oversight of the entire process by local management and their activity in continually trying to promote a leaner process and a more accurate fill of product information to the user and customer.
Yet another participant stated:
There is a crossover between a supplier management and product support in supply chain management. So what we do is the analysis activity for [the] supply chain identifying the requirements. We identify the part in the actual repair part problem part line. And then we hand it to supply chain management which is a part of supplier management function. [Test units for failures and advise supplier management of the required replacement parts].
Describe SCM in the industry
When describing supply chain management in the industry participants stated:
Supply chain management is made up of two things, materials management and supplier management, with reach back into the corporation. Supply chain management is not bound by sites or organizations. [It is] focused on integrated organizational initiatives and capitalizing on the synergies of all groups and functions. A truly virtual organization.
Another participant stated:
It’s the cradle to grave for the material activities [and] for the procurement process. So that would be the proposal to receiving of the product.
Others noted:
Supply chain is the entire network and flow of a product or service, from supplier’s supplier to the user’s user. Or the customer’s customer.
Measure SCM
Measures of supply chain were noted as:
You have to reduce you cost to be competitive, not increase your sales volume.
SCM Suggestion
When suggesting supply chain management solutions participants stated:
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It would help if we had a business model for supply chain, modular and scalable so that the customer could buy just what they needed and what they wanted.
Another stated:
There is a crossover between product support and supplier management [in] terms of activity. It’s not black and white in most cases it’s hard to know who does the supplier management [activity] or supply chain management activity for majority [of the programs] and it’s very confusing.
Describe Bench Marking
Participants described benchmarking in the following manner:
[to benchmark you] find out who else is doing [something similar to what you are doing] and check with function[al] leads to find out if there are not already best practices that are applicable. I also look to see if this is a competency that the firm wants to develop or that my program wants to develop or that my supply chain organization needs to develop, or is it something that I can buy.
Another participant noted:
I would look for subject matter experts in particular areas in which we were looking for best practices. I would look in databases and talk to people that I have come in contact over the years and perhaps that is how I would identify them. Maybe I would do a fact finding journey/mission and talk to process owners and site leads. I would look through every known database that we have.
Still another noted several societies that might be beneficial stating:
The American Production and Inventory Control Society (APICS) and Supply Chain Council can help you do benchmarking against companies that do similar things that you do.
Identify Best Practices in the Firm
Examples of how best practices are identified in the firm were:
Best practices would be identified by another team, independent assessment or review by subject matter experts.
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Another stated:
It’s hard to define because you could say it is because things are working well, as things are going the way they should, but that could happen for something that’s not really a best practice too. It’s hard to qualify.
One participant stated:
We don’t have a lot of best practice in place; we have a lot of good practices and knowledgeable people. The asset managers have some good tools, but it is mostly the subject matter experts that accomplish things.
Describe Best Practice in the Industry
Descriptions of best practices in the industry were:
Something for your business model that yields the results that you want and does it in the most cost efficient way. In other words it gives you the most for the least amount of dollars.
An additional comment was:
Something that is truly a process that can be used by several sites for a particular activity in trying to create a leaner and smarter way of doing business.
Identify Best Practice in the Industry
When identifying best practices in the industry participants indicated there was a
criterion which had to be met stating:
It is a proven process or tool or method that has been proven out, and that is the key, it has been proven out in several different environments but produces a result that is acceptable and desired by our customer.
Another stated:
Proven, it has to be proven. I would have to have a test environment. We need to be able to prove out a suspected best practice in an environment that does not impact current work or programs. Or jeopardize future programs. There needs to be a test environment. It can’t work on only one program. It has to work across programs.
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Best Practice Suggestion
Participants continued to differentiate between classifications of practices stating:
What differentiates between good and best practices? The reason I say good as opposed to best is because we know we are not operating in the most efficient manner. We have good tools, some do not “talk” to the others so there is a lot of manual effort involved, and we have to do a lot of data cleansing and scrubbing. We keep saying we’ll get there, but the people that would be best at improving the process are too busy doing the work, and don’t have the time to improve the process.
Measure Best Practice
Participants provided the following list of measures of best practices:
1. “Financial performance”
2. “Delivery”
3. “Cost reductions”
4. “Cycle-time”
5. “Process time”
6. “Efficiency”
7. “Shortage impact”
8. “Customer satisfaction”
9. “Supplier satisfaction”
Organizational Strength
Participants provided the following responses as observational opportunities for
potential best practices:
We are modular and scalable which allow us to be flexible in our support of programs and services.
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Concerning contract type’s one participant stated:
This is a Performance Based Logistics (PBL) contract that I’m working on. I believe the company is leading the way in PBL. Since a PBL is a service based model, how many spares I sell the customer is not a consideration. I am selling a level of availability. The best practice is a business model or a set of practices that meet the type of business you are performing. The customer only wants to use the aircraft.
An additional opportunity was noted as:
We’re trying to push all of our operators to understand process tasks, so we have gone as far as documenting all of our processes and putting them on a web site and we have supply chain management activity listed and documented so people can actually see what activities they have to do and who they have to go to an order to get something done.
Observations
The researcher made the following observations as suggested by participants of
the activities involving, modular & scalable, contracts, and management by process.
Modular and Scalable
Some respondents stated that organizations that were modular and scalable with
the ability to expand and contract based on customer or contract need were indicators of
organizational strengths. It was noted by the researcher in observations of various
organizations that the firm’s supply chain management organization had a broader
capability offering which was more agile and responsive than other organizations, aided
by the organizations ability to tap into its functional diversity. Review of literature with
respect to the organizations support of various contracts and programs indicated that the
organization was able to support at the required level while maintaining the ability to
bring more service and support to bear when the need arose.
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Enablers of a modular and scalable organization were almost entirely environmental, with
data and systems enablers similar to those noted in organizational and cross functional
roles.
Contracts
Performance Based Logistics (PBL) contracts differ from the typical contract by
having payment tied to the maintenance of a certain level of availability, or performance
instead of a contract tied to transactional delivery. In these cases a customer will provide
a predetermined level of availability and the contractor must anticipate or forecast service
and parts replacement requirements to meet the unit availability level.
The functional description for this observation was represented by the functions of
contracts, product support, supplier management, engineering, procurement financial
support, suppliers, and internal repair facilities.
In reviewing the literature associated with these types of contracts and observing
subject matter expert explanation and execution of PBL the researcher noted that these
contracts were dependant upon data. Forecasting was the key, and critical to forecasting
is data integrity and availability. As noted with other contract types profit was
maximized by accurately projecting product failure rates and planning either replacement
or repair activity in the most efficient and cost effective manner.
Enablers for these types of contracts are the data that is used to plan or forecast
requirements needed to maintain the specified performance levels. It was noted that there
were several systems used in performance of these contracts, but the integrity of the data
was paramount. Knowledge of where data can be located or mined and the ability to
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understand how the data should look and what levels of performance are actually
achievable are necessary in establishing or negotiating the initial contracts.
Management by Process
Management by process is based in part on the International Organizations for
Standardization (ISO) requirement which states that compliant corporations will have a
process control system. Management by process is simply managing activity based on a
process. This ensures that the process control system is valid and applicable.
In Case S30 management by process was the site’s approach to document all effort used
to execute any activity. Management by process was noted as a standard for all other
embedded case units with the exception of S30 which was developing the documentation
and developing training to ensure that all employees were able to access, understands and
execute process as designed.
The researcher used management by process or process based management in the
literature review to help define how best practices would be identified. Statements by the
subject matter experts and observations of a site not managed by process helped the
researcher understand that this approach was not simply a business tactic, but a potential
best practice as well. Thorough documentation of process steps and uniform execution of
those steps ensures quality, efficiency and repeatability.
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Behavioral Engineering Cause & Effect Overlay
Table 31. Case S30 BEM/C&E Modular and Scalable Enablers Data Systems Incentive
Env
iron
men
tal
- Cross functional measures - Cross functional data
- Common system - Cross functional access - Automated measures - Automated transactions
- Agility - Flexibility - Tailored to need- - Competitive advantage
Knowledge Capacity Motive
Beh
avio
ral
- Cross functional knowledge
Table 32. Case S30 BEM/C&E Contracts Enablers Data Systems Incentive
Env
iron
men
tal
- Availability - Accuracy
- Cross functional integration - Forecasting
- Increased profit - Measure accuracy - Long term tie to customer - Cross platform support - Customer need - Funding
Knowledge Capacity Motive
Beh
avio
ral
- Training - Experience
- Value - Exposure
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Table 33. Case S30 BEM/C&E Management by Process Enablers Data Systems Incentive
Env
iron
men
tal
- Detailed input - Detailed internal steps - Detailed output - Detailed systems needs - Detailed deliverables - Cross functional
- Compliance - Uniformity - Isolation of failure points - Identifiable measure points
Knowledge Capacity Motive
Beh
avio
ral
- Training in use - Understand expectations - Acceptable performance - Job retention - Understanding of other processes
Results of the Study
The fractured nature of the supply chain management organization as documented
through organizational descriptions and participant’s perceptions was contributed to by
functional silos and the segregated nature of programs and sites. Although on an
individual level this seemed to provide significant opportunities for the organization,
analysis of the individual sites did not yield a “big picture” of the supply chain
management organization and could not, by themselves answer the research questions;
How can “best practices” in supply chain management be systematically identified and
validated? And to what extent are practices used by the firm in the Supply Chain
Management Organization “best practices”?
Cross Case Analysis: The Big Picture
Speaking with the subject matter experts about the data and reviewing the data
strictly by embedded case unit indicated that individual analysis would not be sufficient
to address the research questions. “When subsystems of a case or multiple case sites are
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key to the study, the researcher must find ways to analyze findings and themes across
cases,” (Ellinger, Watkins, & Marsick, 2005, p 343). In order to answer the research
questions the researcher analyzed all data gathered from the embedded case studies in a
cross case analysis.
The researcher reviewed codes, themes, categories and data in a cross case
analysis to generate meaning and to understand the “big picture.” From the individual
embedded case units the researcher compiled all the codes and themes that were
identified as a result of the interviews, observations and discussions with subject matter
experts during and after the observations. The analysis process included:
1. Cross case analysis of codes and themes from interviews.
2. Cross case analysis of best practices identified by subject matter experts.
3. Cross case analysis of Behavioral Engineering Model Cause & Effect enablers and data.
4. Cross case analysis of notes and discussions with subject matter experts.
5. Review of literature pertinent to the data collected.
The themes and data reviewed in cross case analysis yielded an integrated view
which provided a “big picture” of the supply chain management organization and
answered the research questions. Cross case analysis and synthesis results were:
1. Supply Chain Management
(a) What the Supply Chain Management Organization IS
2. Best Practices
(a) How Best Practices were Identified (b) How Best Practices were Validated (c) Supply Chain Management Best Practices
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3. Behavioral Engineering Model Cause & Effect Results
What the Supply Chain Management Organization IS
The researcher reviewed participant’s perceptions and observed activities in light
of the literature on supply chain management noting several findings; participants, with
few exceptions, generally view the supply chain in terms of their immediate surroundings
and those groups or processes that they interface with. Participants described the supply
chain and supply chain management in terms of the tools and functions that they may use
to execute daily tasks. While participants recognize that supply chain management is
more than their immediate surroundings, with few exceptions participants did not
articulate what it is in total. These analyses lead the researcher to the conclusion that
participants have limited exposure to the commonly accepted roles and responsibilities of
supply chain management which exists in the industry. And as a whole have limited
exposure to the company’s expectation of the organization in general. Tactical execution
supersedes strategic existence.
Further cross case analysis of the interview and observational themes of supply
chain management showed evidence that supply chain management within the firm
manifest in the tangible or physical supply chain and the intangible supply chain. It was
also noted that participants perceived supply chain management as being defined by the
activity pre and post sale of a product, i.e. a pre or production supply chain and a post or
product support supply chain.
Physical Supply Chain Management
Taken in total, perceptions of the physical supply chain included the capabilities
of; develop, plan, make, source, store, deliver, return, and support. Within each of these
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capabilities there were a number of groups, activities or specific roles that participants
associated with each of the overarching capability. Table 35 shows the cross case
synthesis of the research findings. Each activity/group/role is recorded under the
capability in which that activity was most frequently reported. The table also shows what
activities were reported as pre/post transfer/sale of the product to the customer.
Activities that were reported in a specific capability in both pre/post transfer/sale of the
product are noted in italics.
Table 34. Participant’s description of the Physical Supply Chain
Develop Plan Make Source Store/Deliver/Return Support
Pre
- (S
ales
/tra
nsfe
r)
- Market - Sales - R&D - Contracts - Design Engineering Producability
- Requirements - Cost Accounting - Make/Buy - Program Management - Demand Planning
- Operations - Manufacturing - Prod. Control
- Procurement - Sub-Contract MGMT - Supplier Management
- Warehousing - Inventory Control - Production Control - Logistics - Shipping - Receiving - Returns Management - Warrantee work
Pos
t-
(Sal
es/t
rans
fer)
- Contracts - Design Supportability Engineering Producability
- Demand Planning - Forecasting - Cost Accounting - Make/Buy - Asset Management
- Service Repair
- Procurement - Sub-Contract MGMT - Supplier Management
- Warehousing - Inventory Control - Logistics - Shipping - Receiving - Inductions for repair
- Installation - Maintenance - Technical Publications - Field Service
The roles of program management and asset management, warrantee work and
induction for repair are italicized and underlined. The researcher classified these as very
similar activities, thus the italics, but wanted to distinguish that there are significant
differences in responsibilities based on the pre and post DD250 activities.
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After an analysis of the participant responses of pre/post DD250 activities there was a
noted overlap of the activities within each supply chain capability. Accepting the
potential variability in executing a given activity, there is considerable similarity between
what the participants articulated as separate supply chains, pre and post DD250. This
lead the researcher to conclude that the physical supply chain that exists within the firm
can be viewed as a single chain with some varying and overlapping activity specific to
end product use and not two separate supply chains.
Intangible Supply Chain Management
A key finding in the study that was revealed in the coding of the interview
transcripts and confirmed in observations and cross case analysis was participant’s
perception that an integral part of supply chain management was an intangible or non-
physical element that tied the elements together and gave boundaries to the physical
supply chain. In most of the responses there was some statement or indication that
“people”, “processes” and “tools” were an essential, if generic part of supply chain
management, but more importantly participants indicated that information, financial data,
systems, analysis and integration, training, communication and relationships were
essential to supply chain management and important to the successful execution of supply
chain management as a whole. The researcher was not surprised by the inclusion of
status type information and financial data in the responses since the literature specific to
the firm indicates an aggressive approach to training and education in these areas with
communication as a new “thrust” for the firm, which has been vigorously pursued.
Relationships management however is recorded in the industry literature, and was in a
few responses noted as being a factor to execution as well as success.
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Measures of supply chain management
In general participants could clearly articulate the measurement categories found
within the literature and firm itself. Measures of efficiency, effectiveness, timeliness and
quality were a recurring theme. Additionally participants were able to articulate specific
measures of their group/organization and in some cases personal performance or specific
contract performance. Cross case analysis revealed a significant gap in participant
responses about measures of supply chain management as a whole. Isolated responses
indicated measures of “transactional” and performance measures in relation to measures
of contract performance. Only a few participants stated any measures in regard to overall
supply chain health or performance and those responses were specific to transactional
measures or measures of forecasting accuracy only.
Best Practices
In analyzing the participant responses and reviewing the observational data the
researcher was not able to identify a recurring tool, practice or approach used by the
various subject matter experts to identify best practices. It was noted by several
participants that the company identifies best practices for use and execution and these are
usually flowed down the organizational chain for implementation and execution.
Numerous examples of existing company recognized best practices for functional roles
were provided by the participants. Participants noted several database applications,
information repositories, and suggested contact with subject matter experts as potential
avenues for finding or identifying best practices. The actual approach used by
participants was typically based on personal preference.
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When exploring the Firm’s knowledge warehouse database and information
repository with several subject matter experts, the response was that the activity in the
database noted as a best practice may work well for the group that is currently using it,
but based on the descriptive information available the best practice activity logged in the
database it did not appear that this instance was applicable for use by the participant in
their current situation.
Also noted by the researcher during analysis and identification were the lack or
limited nature of any common process or measures that would have made identification
quick and simple. Although common functional metrics existed within the literature
reviewed, the researcher noted during observation that a subject matter expert when
comparing “on-time delivery” metrics across various sites had not considering several
sites scores as potential areas of best practices. The researcher questioned the subject
matter expert who explained that “on-time delivery” means different things to different
sites. Some sites use a calculation based on parts meeting a purchase contract due date,
while others calculated base on the date when the part was needed, still other sites use
this metric to describe delivery of completed product to the customer.
Validation of Best Practices
Participant perceptions and results from observations and review of the literature
indicated that best practices are validated through measures and classification. Cross
case analysis indicated that the diverse background of each site and the varying programs
and projects specific to each site contributed to a mixture of approaches and expectations
for validating best practices. Although no specific approach was identified as
“universal”, participants had very clear expectations that validation of best practices
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should include specific types of measures and a distinct classification of identified best
practices.
Further cross case analysis of data indicate that the majority of the participants
felt that best practices should be validated or classified in some manner. Common across
the cases was an expectation that this verification classification should in some way
indicate whether a practice was proven or not. The best practice literature reviewed
found only one article that made reference to a benchmarking activity in which the
researchers classified various levels of best practices (Jarrar & Zairi, 2000). Several
participants indicated that organizations frequently refer to a practice in use as best while
knowing that improvements or better approaches exist, but may not be deemed necessary
to pursue by the organizations that are currently using the “best practice” in question.
Responses indicate that a best practice classification approach could recognize
that some practices may be “intuitive” for the current organization without any past
experience of proven history. Another classification could recognize practices as “good”
for a specific organization or function, with performance data available to support the
approach as successful while limited to certain parameters. The classification of
“proven” could be used for those practices that had the historical data and performance
measures to show positive performance impact over an extended period of time. The
final suggested classification was company or organizational approved and recognized
best practices. These would be practices which had gone through a rigorous validation
process and had historical performance data showing positive contribution to the
organization and company. Validation and Classification categories developed by the
researcher in response to the subject matter expert suggestions are listed below:
171
1. Intuitive – Identified “best practices” with no historical performance data.
2. Good – Identified “best practices” with limited historical performance data, such as performance data for only one application, department or organization.
3. Proven – “best practices” meeting the Good classification with historical performance data that cover multiple applications, multiple departments, and multiple organizations, this may including performance data external to the firm.
4. Organizationally Approved – Proven best practices that are identified by the organization as adding to the competitive advantage of the organization and the firm. May be benchmarked externally.
Best Practice Identified
Although the majority of participant perceptions of the supply chain management
organization were limited to the participant’s immediate surroundings there were few
best practices identified that that did not have the potential to span and encompass the
entire supply chain. In most cases the potential best practices identified were concepts or
approaches derived from existing functional or site activity that could be developed and
expanded to apply to the entire supply chain. It was also noted that the best practices
identified could be grouped into similar categories of; organizationally related best
practices, communication related best practices, people related best practices and those
that were tool related
Distinctions were made between those practices that had the ability to span or
apply to the entire supply chain promoting overall supply chain management success and
those that were more localized. The researcher identified global or best practices that had
several applications as strategic best practices. Tactical best practices were those that
172
were specific to project or program activity using some of the supply chain management
elements but not applicable to all.
Appendix F: Potential Best Practices Identified and Classified in Supply Chain
Management, represents the potential best practices in the categories of, communication,
organization, tools, and people, indicating when practices are strategic or tactical in
nature, and classifying the best practices based on the validation criteria synthesized from
the data. Included in this list are those best practices identified as a result of the
BEM/C&E noted in italics.
As depicted (see Attachment F) most of the identified best practices fall into the
“good” classification. There were sufficient measures in place to indicate these practices
were effective in their current setting. In some instances these practices may be used by
other sites and program that were not identified for observation. Confirmation that these
practices have been successfully implemented with historical data measures would
elevate these practices to a proven classification. For those practices that are classified as
intuitive, these practices were identified during the BEM/C&E analysis and have no
performance data available. Proven best practices were those practice which were
recurring in participant coded responses and observations. Since no best practices
currently exist or had been identified by the supply chain management organization, no
practices identified in this study would meet the organizational approved classification.
Behavioral Engineering Model Cause & Effect Results
Analysis of the observations and the Behavioral Engineering Model Cause &
Effect (BEM/C&E) analysis identified potential best practices in the supply chain
management organization and BEM/C&E enablers
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Researcher cross case analysis of the Behavioral Engineering Model Cause &
Effect (BEM/C&E) noted that 22 observations were analyzed by best practice category,
enabler attribute and enabler category. Table 36 presents the cross case analysis of the
data.
Table 35. Cross Case Best Practice Enabler
Behavioral Engineering Enabler Synthesis Matrix
Observation Enablers Enabler Appearance in BEM Categories
Indi
vidu
al
Env
iron
men
t
Beh
avio
r
Dat
a
Sys
tem
s
Ince
ntiv
e
Kno
wle
dge
Cap
acity
Mot
ive
Organization 2 19 10 5 7 7 3 2 5 Communication 3 28 21 9 5 14 4 3 14 Tools 13 145 69 47 41 57 29 16 24 People 4 27 22 8 7 12 9 3 10 Totals 22 219 122 69 60 90 45 24 53
Analysis of the enablers influenced by the environment and those influenced by
behavior indicate that the environment enablers out weighed behavioral enablers almost
two to one. This would indicate that the organization and the firm tend to have systems
and environmental influences in place that promote or enable best practices to exist
instead of relying on subject matter expert or employee behavior to initiate and maintain
a best practice environment and culture. Analysis also shows that incentives and data are
top contributors to current best practices.
The researcher also noted in analyzing the best practice enablers that there were
several recurring enabler descriptions. Common systems enablers occurred 23 times,
174
cross functional data enablers occurred 22 times, previous experience/exposure occurred
21 times, training enablers occurred 19 times, relationship enablers occurred 12 times,
and data integrity or quality occurred 9 times. These findings lead the researcher to
include common systems, cross functional data and relationships management as
potential best practices.
Conclusion of Chapter 4 Results
Cross case analysis enabled to researcher to address the research questions.
Responses indicate that participants are very familiar with the “best practice” concept.
The majority of the respondents could clearly articulate what and why organizations
would want to pursue best practices. Cross case analysis and observation shows that the
participant’s description or definitions of best practices were limited to local experience.
Some participants used the benchmark definition and/or descriptions of various
benchmarking activities while describing and defining best practices in general. While
general descriptions of best practices may vary, participants on the whole described best
practices as approaches or techniques executed to improve current performance.
Research Question 1 Answered
How can “best practices” in supply chain management be systematically
identified and validated?
There was no process, practice or approach identified in individual embedded unit
analysis or cross case analysis that was either universal or consistent over several sites for
identifying best practices in the supply chain management organization. The researcher
feels that the protocol used in the study, an embedded case study using interviews,
175
observations the BEM/C&E and cross case analysis along with specific techniques noted
in the literature could be used to systematically identify best practices within the firm and
in other applications as well. Appendix E: Potential Best Practices Identified and
Classified in Supply Chain Management lists the potential best practices identified as a
result of this study.
There was no single approach used within the firm for validating or classifying
best practices. Results of the embedded unit and cross case analysis indicate that there
was no recognized or accepted approach for validating or classifying best practices in the
firm. Cross case analysis identified a number of subject matter expert responses that
when compared to the literature and discussions with experts yielded a four classification
validation criteria developed by the researcher, Those validation criteria are intuitive,
good, proven and organizationally approved.
Research Question 2 Answered
To what extent are practices used by the firm in the Supply Chain Management
Organization “best practices”?
There are no Supply Chain Management Best Practices in the organization or
within the firm, but embedded case and cross case analysis did yield significant subject
matter expert suggestion and opportunities for observation of practices used by
participants in the firm and organization. These practices and others identified through
BEM/C&E analysis are listed in Potential Best Practices Identified and Classified in
Supply Chain Management (see Appendix F). These potential best practices are
classified using the validation criteria established by the researcher, intuitive, good,
proven and organizationally approved. Using this validation criteria, only two of the
176
practices listed fall into the “proven” best practice category, management by process and
demand forecasting meet the validation criteria of historical data from multiple
applications, functions and organizations.
Additional Findings
In the process of answering the research questions there were a number of
additional findings that the researcher felt were significant. These additional findings
were a description of the supply chain management organization within in the firm, use
of the BEM/C&E as a tool for identifying best practices, and environmental vs.
behavioral enabler ratio.
Cross case analysis of responses and observations indicates that the supply chain
management organization has all the physical elements of developing, planning, and
making, procuring, storing, delivering, returning and supporting a product and/or service.
The organization has successfully integrated these physical functions with the
information, financial and communications networks which in turn are bound and
managed through a robust relationship oriented management approach spanning from the
supply base to the customer.
Cross case analysis of the BEM/C&E enablers yielded two additional study
findings. Cross case analysis of the individual enablers indicated that there were several
recurring enablers for practices that were analyzed. These recurring enablers were
included in the potential best practices identified in the firm and would indicate that the
BEM/C&E has the ability to identify best practices independently and in conjunction
with other best practice identification and benchmarking tools.
177
Additionally, it was noted that environmental enablers out weighed behavioral
enablers more than 2:1 indicating that the Supply Chain Management Organization has
an infrastructure that supports and enables best practices versus relying on subject matter
expertise to foster and cultivate a best practice environment.
178
CHAPTER 5. RECOMMENDATIONS
Introduction
The purpose of this empirical embedded case study was to describe the real world
experiences of a firm engaged in supply chain management activities, focused on
identifying participant perceptions of supply chain management, best practices
identification and validation, and determining if practices used in the supply chain
management organization are best. The contributions of this research include additions
to the theories of supply chain management, best practice and human performance
technology as well as providing foundations for future research into causal relationships,
predictive measures or process approaches.
This chapter presents the conclusions and recommendations from the researcher’s
analysis and synthesis of the study’s findings. This chapter is organized into three
sections; 1) Value of the study, 2) Conclusions resulting from the findings of the study
and 3) Recommendations for future research and the leadership of the organization
involved in the supply chain management.
Value of the Study
As stated in Chapter 1 the theoretical foundations of the study were Swanson’s
(2007) three human performance technology elements of organizational performance: 1)
economic theory, 2) psychological theory and 3) general systems theory.
Since defense agencies continue to emphasize costs as key drivers in contract
award decisions, firms engaged in defense contracting must continue to find ways to
179
improve competitive advantage and reduce costs (King & Driessnack, 2007). The
literature would indicate that a key economic driver to improving the firm’s competitive
advantage was to understand the firms approach concerning best practices. Since best
practices are seen as a proven approach to cost savings and improved competitiveness
(Zairi, & Al-Mashari, 2005). The organization does not have recognized best practices,
nor is there a process for identifying and validating, however in the process of conducting
the study, potential best practices were identified thus providing an approach for
identification. Validation classifications were also identified and documented. Based on
past studies of best practices the Supply Chain Management Organization can help the
firm reduce its costs and improve both the organization and the firm’s overall competitive
advantage by pursuing implementation of the identified potential best practices.
The psychological foundations are based on the recognition that humans broker
productivity through their behavior (Swanson, 2007), and the emphasis on external
reinforcers to that behavior (Swanson & Holton III, 2001). The study observed behavior
in an attempt to answer the research questions and through the lens of the Behavioral
Engineering Model, identified environmental enablers of behavior. The implications of
the study findings indicate that the human performance technology approach which
focuses on the human element of performance is a significant and appropriate approach
to analyzing business or organizational performance. Findings also indicate that Gilbert’s
(1996) Behavioral Engineering Model is an appropriate and effective tool for not only
analyzing behavioral observations, but when used in conjunction with a cause and effect
diagram, becomes a powerful tool for identifying enablers for best practices and
identifying potential best practices.
180
Systems theory addresses the lack of defined processes for best practices
identification, which is a systematic disconnect that affects performance (Swanson,
2007). By identifying potential best practices in the Supply Chain Management
Organization the research enables the organization to link organizational goals with
activities designed to accomplish those goals and the work force responsible for
executing them. Further the finding that the Supply Chain Management Organization
itself was a process encompassing and integrating all activity involved in developing,
building/buying, storing, delivering, and returning and supporting a product or service is
in itself a systems theory approach to executing successful, competitive defense
contracting. This would indicate that both the theory of supply chain management is a
valid, competitive approach for defense firms and that systems theory is applicable to the
supply chain management principle.
These findings not only benefit the firm and the Supply Chain Management
Organization, but are beneficial to the field of study as well. There was little literature
available in regard to supply chain management and best practices as well as a lack of
relevant study data with in regard to validation and classification of best practices. The
study also included a unique combined use of the Behavioral Engineering Model and a
Cause & Effect diagram. Each of these contributes to the body of knowledge and
provides potential sources for future study.
Additional findings included a complete description of the current supply chain
management organization, the creation of a new tool, the BEM/C&E, and several
recommendations for further research.
181
Conclusions
Research Question 1: How can best practices in supply chain management be
systematically identified and validated?
The Supply Chain Management Organization did not have identified best
practices, nor was there an approach for identifying or validating best practices. As
stated in Chapter 2 during the literature review, the researcher could not identify policies
or approaches that helped the employee identify pertinent best practices for use and
deployment. Based on the interview responses and subsequent observations and
continued review of the literature it is evident that the firm does not have a universal
approach that helps employees indentify best practices. Although employees understood
the best practice concept well and had the ability to articulate with some degree or
accuracy what a best practice was, it appeared to the researcher that the numerous
databases, and data management sites where best practices were supposed to be
consolidated did not include enough information or comparative measures for the
employee to accurately identify a comparable best practice for replication. Descriptions
were vague and while measures may have existed, comparative measures were
nonexistent.
The literature reviewed and previous study information collected would indicate
that comparative metric analysis is the usual and preference approach for identifying best
practices. Results of the findings of the study indicate that the HPT process of focusing
and analyzing the human element, in this case through interviews and observations
yielded 19 potential best practices for the Supply Chain Management Organization. The
Behavioral Engineering Model, by design, provides a general approach to where one
182
should look to find enablers, (Gilbert, 1996), while the Cause & Effect diagram provides
an approach for how one should identify the root causes, or enablers of and effect,
(Brassard, & Ritter, 1994). Damilio notes that “an enabler is any condition or factor that
influences the effectiveness of a practice” (1995, p. 7). Results of the final cross case
analysis indicate that researcher use of the BEM/C&E identified three additional potential
best practices. By using the BEM/C&E and listing all the enablers for best practices in
the BEM categories, the researcher was able to cross analyze not only categories but
recurring enablers. When a single enabler appeared to be a common enabler for multiple
best practices it would appear that that enabler would meet the best practices criteria of
multiple application and positive impact. These additional potential best practices were
common systems, cross functional data and relationships management.
These descriptions and the subsequent findings lead the researcher to conclude
that use of the HPT theory of human performance and the Behavioral Engineering Model
overlaid with the Cause & Effect diagram provided the foundational structure and both
the how to and where to look in identifying influences of effectiveness. Therefore the
researcher concludes that the HPT theory and BEM/C&E are valid approaches for
identifying best practices.
As stated earlier there was no process or approach identified within the firm for
validating best practices. Review of the literature did not reveal significant literature or
theory concerning the validation of best practices. Only one article by Jarrar and Zairi
(2000) was found indicating that not all best practices should be viewed the same, and
that there should be some classification criteria in a validation process for best practices.
183
Independent subject matter expert responses in the research study indicated that they felt
that best practices should be validated and then classified as well.
Based on the subject matter expert input, literature review and observations the
researcher created the validation and classification criteria of; intuitive, good, proven and
organizationally approved. Therefore the researcher concludes that the validation and
classification criteria developed as a result of the study findings is a valid approach for
validating and classifying best practices.
Research Question 2: To what extent are the practices used by the firm in the Supply
Chain Management Organization “best practices”?
Although there were no recognized supply chain management best practices, there
were a number of functional best practices. As noted in Chapter 2 best practices exist in
Supplier Management, Program Management and other functions. In addition to these
there were organizational or corporate best practices. Most participants indicated that the
practices that they used as “recognized” best practices were in reality simply good
practices and not what they would consider best. Several examples were given where
“best practices” had approaches that were more effective, but were not recognized by the
firm and therefore those improvements were not incorporated
Best practices are those processes or steps that add to a firm’s competitive
advantage, (Camp, 1989). In each case where the researcher observed potential best
practices, the respondents suggested the potential best practices by indicating that
practice or approach’s impact on some measure that was significant to their site or
program. In essence the use of the practice in question contributed to their departmental
or site competitive advantage. Observation and subsequent analysis of the pertinent
184
literature and interview responses indicated that the practice observed in some way had a
positive impact on the immediate surroundings and had potential to positively influence a
broader sphere of activity.
Therefore the researcher concludes that the practices observed and those
identified using the BEM/C&E had the potential to be best practices in the supply chain
management organization. These 22 best practices are detailed (see appendix E) and are
classified using the validation and classification criteria identified for research question 1
above. The researcher further concludes that of the 22 best practices identified only two
meet the validation criteria of having historical performance data covering multiple
applications, departments and organizations, to be classified as a true or proven best
practice.
Summary of Conclusions
The implications for the Supply Chain Management Organization are several
tools for identifying best practices and classification criteria for validating identified best
practices. Further study of the Organization’s activity resulted in a suite of 22 potential
best practices, with two of those practices being classified as “proven.” The theory of
Supply Chain Management and Best Practices was shown to contribute to the competitive
advantage of a defense firm engaged in competition for defense contracts.
The theory of human performance technology was shown to be an appropriate
approach for analyzing supply chain management activity and for the study of best
practices. The Behavioral Engineering Model theory used in conjunction with a Cause &
Effect diagram were also shown to be effective in analyzing observed supply chain
management activity and identifying potential best practices.
185
Recommendations
The researcher offers two recommendations for future study that were identified
in the current study, three recommendations for the present supply chain management
organization and one recommendation for the future of the organization.
Recommendations seven through nine were recommendations identified by subject
matter experts during interviews and observations.
Recommendations for Further Research
Recommendation 1: The researcher recommends that additional studies be conducted
using the best practices validation and classification criteria established in this study.
The results of embedded unit and cross case analysis resulted in a four category
validation process for classifying best practices. Further research should be conducted to
test this process and prove its potential as a standard validation process for best practices.
Recommendation 2: The researcher recommends that additional studies be conducted
using the Behavioral Engineering Model/Cause & Effect (BEM/C&E) analysis tool for
identifying best practices.
The results of the study would indicate that the BEM/C&E was an effective
analysis tool that could be used to identify best practices in settings were best practice
process and approaches do not exist as well as in settings where there is a robust best
practice process in place.
Recommendations for the Present Supply Chain Management Organization
Recommendation 3: People involved with the Supply Chain Management Organization
need to understand the organizations role and capabilities.
186
The researcher recommends that the organization develop an overview training
that covers the phases of the supply chain management, typical roles, responsibilities and
capabilities of the organization that were identified in this study. This training would
serve as an introduction to those employees working in the organization and those
stakeholders and customers that my have need to interface with the organization.
Recommendation 4: Employees involved with the Supply Chain Management
Organization need a process for identifying and validating best practices within the
organization.
The researcher recommends that the organization create a best practice process
that defines the organizational expectations of a best practice and provides a guide to
identifying and validating best practices. This process should include the following; a
best practices definition, detailed approach to identify best practices, internally and
externally, and should include validation criteria. This procedure should include
directions on when and how to use the Behavioral Engineering Model/Cause & Effect
analysis tool. It should also include a portion detailing validation approaches which
would include the classifications of; intuitive, good, proven and organizationally
approved best practices.
Recommendation 5: Employees in the Supply Chain Management Organization need to
develop a suite of best practices to ensure that the organization is contributing to the
competitive advantage of the organization and the firm.
The researcher recommends that the Supply Chain Management Organization
adopt the best practices identified in the study and develop a culture of best practice by
continual review of current practices and benchmarking other organizations and
187
corporations best practices. A further recommendation is for the organization to use the
Behavioral Engineering Model/Cause & Effect tool to analyze processes, internally and
externally to identify enablers previously unidentified that can be incorporated as best
practices.
Recommendations for the Future Supply Chain Management Organization
Recommendation 6: The Supply Chain Management Organization needs to develop a
mindset of being continuous learners regarding the ongoing development of the
organization and employees.
The Supply Chain Management Organization should continue its internal
organizational development and ensure that the employees of the organization are in step
with the development process. The organization should continue its training
development program and broaden the scope to include and encompass in depth training
for each of the phases, roles and capabilities. The researcher recommends that the
organization develop a Supply Chain Management University where employees can
receive up to date and cutting edge concept training in the expectation of the
organization. Included in this training should be review and application of the recognized
Supply Chain Management Best Practices.
Recommendations by Subject Matter Experts
Recommendation 7: The Supply Chain Management Organization needs to develop an
estimating model that can accurately estimate the supply chain costs and activity in
support of proposals.
188
Recommendation 8: The Supply Chain Management Organization needs to develop an
approved recruitment process that ensures the organization attracts top supply chain
management candidates.
Recommendation 9: The Supply Chain Management Organization needs to develop a
common “language” since the organization is cross functional in nature and includes
customers and suppliers.
189
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APPENDIX A. STRUCTURED INTERVIEW GUIDE
Structured Interview Guide Opening/Introduction I would like to thank you for your voluntary participation in this research project and submitting your consent form. Your participation in this study may be recorded. These provide a record of the test sessions that we can analyze off-line so that we do not have to depend only on our memory and written notes. You may ask that audio recording be turned off and/or that recording media be destroyed at any time during your participation. Recordings are to be coded so no traceability to the source can be made and will be destroyed once the study is published. May I proceed with recording our conversations? Yes_______ No________ For the record, please indicate that you agree to the recording of our conversations. Structured interview objectives:
The objective of the interview is to gain insight into your view of Supply Chain Management structure, and best practice use and deployment in the execution of supply chain management activities. There are ten questions, and the overall interview should not take more than 30 minutes. Structured interview questions:
1. What is ‘supply chain’? 2. What is ‘supply chain management’? 3. Do you interface with Supply Chain Management? If so how? 4. What is a ‘best practice’? 5. How do you know if you have a ‘best practice’? 6. How do you find and implement best practices? In theory? In practice? 7. What do you or your department/organizational do that might be considered a strength?
Why? How do you measure them? 8. Do you consider these strengths to be best practices? Why? How do you measure them? 9. Do you know of best practices in your field? How do you know about them? 10. Is there a plan to incorporate them into your ‘area’? How?
Thank you: I would like to thank you for your time and participation and remind you that we will maintain your confidentiality as much as possible throughout the research project. If you have any questions about this study please contact: Jay F. Chance at (850) 803-0916
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APPENDIX B. LETTER OF INTRODUCTION
Global Services & Support Supply Chain Management
11 February 2009 JFC-SCMRSBP-09-001 Attention: To Whom It May Concern Subject: Research Study of Best Practices in Supply Chain Management To Whom It May Concern: This memo is to introduce Jay F. Chance, Supplier Program Manager, and a highly qualified individual with 20 years experience in the fields of Operations, Program Management and Supplier Management. Chance has been engaged by the Supply Chain Management organization to conduct a case study commissioned by myself. Ultimately, by means of this case study approach my organization hopes to identify and document answers to such question as: How do we develop, select and evaluate best practices, and what are the best practices used in the Supplier Chain Management Organization This memo is directed to site and program leaders, subject matter experts and support personnel. We must ask you to dedicate some time, experience and patience to our interviewer. Your cooperation is most essential if the case study is to successfully guide and support the final policy recommendations which the researcher must provide to my office. On behalf of the research members involved I wish to express our gratitude for your assistance. Should you wish to be included on our distribution list for the final report, our interviewer will be glad to make the proper arrangements. Again, thank you very much for your support and time
Regards,
Ken Shaw Vice President, Global Services & Support Supply Chain Management
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APPENDIX D. INFORMED CONSENT FORM
RESEARCH SUBJECT INFORMATION AND CONSENT FORM
TITLE: A Study of Best Practice in Supply Chain Management SPONSOR: Supply Chain Management INVESTIGATOR: Jay F. Chance 626 Anchors St NW, Fort Walton Beach FL 32548 850-362-5748 jay.f.chance@[Firm].com
SITE(S): Long Beach, CA; Mesa, AZ; Oklahoma City, OK; Philadelphia, PA; Puget Sound, WA; San Antonio, TX; Wichita, KS; Fort Walton Beach FL; St. Louis, MO; United Kingdom & Australia
This study has been approved by Capella University’s IRB 105539-1, effective from February 17, 2009 through February 17, 2010. This consent form may contain words that you do not understand. Please ask the researcher or the study staff to explain any words or information that you do not clearly understand. You may take home an unsigned copy of this consent form to think about or discuss with family or friends before making your decision. SUMMARY
You are being asked to be in a research study because you have been identified as having the appropriate expertise and experience in which the research study is exploring.
Your decision to be in this study is voluntary. If you decide to be in this study and then change your mind, you can leave the study at
any time. You will be in this study for at a minimum one 30 minute interview, and should follow-up
questions be necessary, a second 30 minute interview. If you agree to be in this study, your research records will become part of this study.
They may be looked at or copied by the sponsor of this study or government agencies or other groups associated with the study.
More detailed information about this study is in this consent form. Please read it carefully. PURPOSE OF THE STUDY: Is to understand how best practices are used in the supply chain management organization. Specific questions and possible observation will seek to understand how best practices are developed, selected and evaluated The study is expected to be completed by the end of 2009. You will be in this study for the duration although actual participation will be limited to interviews, questionnaires and potentially observation of an activity. Approximately 50 subjects will participate in this study. The study is scheduled to take place between Feb-1-2009 and Aug-30-2009, and will be done primarily from the Fort Walton Beach site, with follow-up sessions at sites chosen for observation. PROCEDURES If you decide to participate, you will:
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Be asked to answer the following questions o How does your organization report to the corporations supply chain management
function? o What is ‘supply chain’? o What is ‘supply chain management’? o Do you interface with Supply Chain Management? If so how? o What is a ‘best practice’? o How do you know if you have a ‘best practice’? o How do you find and implement best practices? In theory? In practice? o What do you or your department/organizational do that might be considered a
strength? Why? How do you measure them? o Do you consider these strengths to be best practices? Why? How do you
measure them? o Do you know of best practices in your field? How do you know about them? o Is there a plan to incorporate them into your ‘area’? How?
Should some of your responses fit the criteria as of a best practice the researcher may
request to observe the practice as it is being performed Your participation in this study may be recorded. These provide a record of the test sessions that we can analyze off-line so that we do not have to depend only on our memory and written notes. You may ask that audio recording be turned off and/or that recording media be destroyed at any time during your participation. All recordings will be destroyed once responses are coded and prior to publication of the research data. RISKS AND DISCOMFORTS There are no anticipated risks in this study that are greater than you will encounter in performing your normal duties. If you experience any discomfort, you should inform the researcher immediately and stop your participation. BENEFITS You are not expected to benefit directly from participation in the study. The results from the study may however increase the productivity of the overall organization and potentially may be the basis for corporate improvement initiatives COSTS There is no cost to you for participating in this study. PAYMENT FOR PARTICIPATION You will not receive any additional payment for participating in this study. ALTERNATIVE TREATMENT This is not a treatment study. Your alternative is to not participate in this study. CONFIDENTIALITY Information from this study will be given to the sponsor. Research records, including photos, audio and video recordings and the consent form signed by you may be looked at and/or copied for research and regulatory purposes by:
The sponsor The Firm
Absolute confidentiality cannot be guaranteed because of the need to give information to these parties. The results of this research study may be presented at meetings or in publications. Your
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identity will not be disclosed in those presentations. Your identity will not be released to the general public without your consent, unless specifically required by law. VOLUNTARY PARTICIPATION AND WITHDRAWAL Your participation in this study is voluntary. You may decide not to participate or you may leave the study at any time. Your decision will not result in any penalty or loss of benefits to which you are entitled, nor will it have any effect on your employment at The Firm. If significant new findings develop during the course of this study that may relate to your decision to continue participation, you will be informed. Your participation in this study may be stopped at any time by the researcher or the sponsor without your consent because:
you have not followed study instructions; the sponsor has stopped the study; or administrative reasons require your withdrawal.
SOURCE OF FUNDING FOR THE STUDY This study is being funded by The Firm QUESTIONS If you have any questions about this study or your participation in this study, contact: Jay F. Chance (850) 326-5748 E-mail: jay.f.chance@[Firm].com If you have questions about your rights as a research subject, you may contact: Greg Lim Human Subjects Protection Program Administrator 425) 865 1068 E-mail: Gregorio.Lim@[Firm].com Do not sign this consent form unless you have had a chance to ask questions and have received satisfactory answers to all of your questions. If you agree to be in this study, you will receive a signed and dated copy of this consent form for your records. CONSENT I have read the information in this consent form. All my questions about the study and my participation in it have been answered. I freely consent to be in this research study. I authorize the use and disclosure of my information to the parties listed in the confidentiality section of this consent for the purposes described above.
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By signing this consent form, I have not given up any of my legal rights. ________________________________________ Subject Name CONSENT SIGNATURE: ________________________________________ __________________ Signature of Subject Date ________________________________________ __________________ Signature of Person Conducting Informed Date Consent Discussion
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APPENDIX F. POTENTIAL BEST PRACTICES IDENTIFIED AND CLASSIFIED IN SUPPLY CHAIN MANAGEMENT
Category Practice Strategic Tactical Classification
Organizational Organizational Roles in a Cross Functional Setting
X Good
Modular and Scalable Supply Chain
X Good
Common Systems X Intuitive Cross Functional Organization
and Development X Intuitive
Relationships Management X Intuitive Communication Cross Functional Leadership
Team X Good
Customer and Stakeholder Participation
X Good
Personal and Group Dynamics X Good People People Development X Good Subject Matter Expertise and
Development X Good
Employee Involvement X Good Tools Predictive Indicators X Good Spares Checkbook X Good Paperless X Good Management by Process X Proven ROI Forecasting X Intuitive Cell Workgroup Concept X Good Global Tool Tracking X Good Logistics Support Analysis X Good Performance Based Logistics X Good Contractor Logistics Support X Good Forecasting (3 cases) X Proven