Supply Chain Blog

Supply Chain and S&OP Compliance & Assessment

Posted by Michael Thompson on Wed, May 18, 2011

My earlier blogs about supply chain and S&OP compliance have prompted a number of further discussions.

I love being compliant resized 600One particular issue that has emerged is an area of potential confusion. It came to light during a recent discussion with a Supply Chain Executive of an FMCG multinational. 

SCE (Supply Chain Executive) - You have mentioned the need to produce a checklist based upon an operating model. Indeed this was noted as “Step 2” in one of your blogs.  We tried this and it looked very similar to the list that we previously used to assess our supply chain.

Mike  Good. It is supposed to. However, there is a significant difference between a ‘deep dive’ assessment of the supply chain and a regular operational compliance check.

SCE  Please explain.

Mike  A supply chain assessment is a periodic event that assesses the status of the supply chain and can, for example, measure supply chain maturity.  It is akin to an audit and typically takes between one and three weeks for a operating company, depending on the level of detail. 

A monthly compliance check is a simple and quick method of assessing the extent to which there is compliance against, for example, a set of supply chain process standards that have been developed and deployed.

SCE  I can understand that.  But you said that the two are similar. 

Mike  Yes. The two are similar in so much that they should be closely aligned. Ideally the compliance checklist should be fully supportive of the supply chain assessment originally used, assuming that you wish to measure compliance based upon the original assessment (audit).  The difference is that the compliance check is a simplified and more ‘user friendly’ version.

SCE  So at one level they could be almost identical?

Mike  Yes. For example, you may wish to use the same key activities (e.g. demand planning) and the same checklist criteria within each key activity but please remember that the compliance checklist must be simple.

SCE  How can I make the monthly checklist simple if the original assessment was far more complicated?

Mike Try this test.  For each item on the checklist, make sure that it can be answered with a “yes” or “no” response.

SCE  Sounds straight forward.  Let me try.

Mike  It is not too difficult but does need to be carefully thought through.

SCE  Leave it with me ....

S&OP Compliance

 

Read other posts regarding Complience HERE.

 

Image credit: zazzle.co.uk

Tagss: FMCG, Michael Thompson, S&OP, Forecasting & Demand Planning, Compliance