PROBLEM / CHALLENGE
MTM, a specialty transportation company that uses external transportation providers, had a company strategic plan but not a supply chain strategy. Therefore, efforts to improve supply chain operations were haphazard and misaligned internally and with external suppliers. In addition, while every function had key performance metrics, they were not coordinated, lacked clear goals and not visible.
Performance Measurement and Supply Chain Strategy Assessment
An Assessment was conducted to understand how the company measured performance across all supply chain functions, what they were working on to improve performance and how the company strategy impacted supply chain.
- Formed broad Supply Chain Strategic Team
- Technology, customer service, transportation operations, field management
- Led team through SWOT and Porters 5 Forces analysis to set baseline of current state
- Created a strategy map based on the pillars of supply chain strategy
- See graphic below and strategy map on next page
- Gap analysis guided focal areas for improvement
- See gap analysis on next page Drove from strategy to tactical action items and key performance measures
Pillars of Supply Chain Strategy
Key Strategic Actions
- Build Strategic Partnerships: Instead of working with many, smaller transportation providers, the company identified the providers they would help grow, to achieve economies of scale and lower costs. Business was moved from poor performing and smaller providers to higher performers.
- Build a Complete and Flexible Transportation Network: The existing network was complete but not flexible. Customers required flexibility. The company used its upgraded supplier partnerships to build in greater flexibility to change routes as needed to accommodate customers. Because of economies of scale, this improvement was cost- neutral.