Supply Chain Vector [Electronic resources] : Methods for Linking the Execution of Global Business Models With Financial Performance نسخه متنی

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Supply Chain Vector [Electronic resources] : Methods for Linking the Execution of Global Business Models With Financial Performance - نسخه متنی

Daniel L. Gardner

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Past as Teacher


Even a casual familiarity with world history would lead one to believe that one of the best sources for guidance on how to fashion an organization is found in the study of political science. Antiquity and the Common Era abound with examples, both good and bad, of how governments were constructed to accommodate the times (or, unfortunately, the ambitions of their leaders). Regardless of their original intent, the study of governments and the mechanisms that have either championed or thwarted the advance of mankind serve as a well of information for today's international businessperson.


One example that has commercial parallels is found in the similarities that exist between segregated departments in a company and the city-states of Italy both prior to and during the Renaissance. Compared to the enclaves of accounting, manufacturing or sales, the cities of Florence, Venice and Rome really were not that different. Because each operated autonomously with its own army and government, these cities took periodic beatings from Spain, France, the Swiss and even each other. Until such time as Italy was able to establish national solidarity with a common agenda, they were subject to the humiliation of their rulers. When departments in a company act as city-states, they too will be subject to the whims of the market and their competitors.


The Constitution of the United States, the culmination of 5,000 years of socio-political evolution, is the most definitive treatise ever written on the organization of a government, assuring what Jefferson called the inalienable right to "life, liberty and the pursuit of happiness." Commercially speaking, a company's constitution should foster "growth, liquidity and the pursuit of profitability." When viewed through commercial glasses, the Constitution provides the best mission statement and business plan for governmental success ever prepared. More than 200 years after it was written, countries of the world are still trying to achieve what was done by a collection of gentrified rebels in Philadelphia during the summer of 1787. Rife with compromise and recognition of the need for federally guided decentralization, all managers, be they American or otherwise, should study its content as they seek wisdom for their own organizational purposes.


The debate that took place at the Constitutional Convention is strikingly similar to the questions that businesspeople have contemplated for the last 100 years. Is a strong federal government the answer (centralization) or is a loose collection of states with their own sovereignty (decentralization) the best design for a nascent country? Also, how are the various government entities organized to assure a balance of power and still have the teeth to hold the nation together? For the global enterprise, this story sounds a lot like the need it has for a balanced relationship (albeit symbiotic) between a central entity that sets policy and the flexibility field operations requires to run their businesses.


The solution to the constitutional dilemma was strikingly similar to the one global entities will eventually arrive at — a compromise. Whereas the Articles of Confederation forged a structure in which there was no central authority, the Constitutional Convention drafted a plan that created a series of "checks and balances" between state and federal power. This same structure may be exactly what today's global companies require to be successful in their theaters of operation.


A major step in the commercial process of compromise and restructuring is observed in the formation of supply chain entities (not departments) in organizations. As recently as seven years ago one would never have received a business card from a colleague with the title director of supply chain operations or vice president of supply chain management. Today, it is quite common to see these positions crop up, as they are a manifestation of a commitment to create entities that transcend business units while removing obstacles at a local level.


While there are still many challenges to be met in designing the ideal global enterprise, the ability to compromise and subordinate departmental or divisional agendas to the benefit of the organization are two giant steps forward. Because corporate culture is a function of organizational structure, proper nurturing of the latter will promote an environment that allows people to see the forest through the trees, clearing the field for the disciplined execution of supply chain strategies.


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