Supply Chain Blog

FMCG Supply Chain: KPI Scorecards - Don’t look back in anger

Posted by Dave Jordan on Wed, May 30, 2018

UK has been my base for a few days and even in that short time I have started to genuinely think I must now be a different nationality if not from a different planet. When my denim jeans rip at the knees it is time to throw them out.  I do not have a badly drawn and inappropriately placed tattoo. Nothing on me is pierced or decorated with metal, precious or otherwise.

I do not have a preference for Ant or Dec – the “best” UK double act in a sea of tepid TV reality dross? What is Keith Lemon all about? So many TV channels yet so little talent and even less TV shows worth watching. I put litter in waste bins. I still know how to queue. Even my waistline is now considered trim. I own music recordings where the performers wrote the lyrics and play the instruments and don’t get me started on that things like the Kardashians. 

Nevertheless, there is something consistent. Something that has not noticeably changed since I packed my company leaving gift suitcases in 1991 and departed for the Saudi desert. Traffic Wardens.

FMCG_KPI_SCORECARD_SUPPLY_CHAIN.jpgBeing a Traffic Warden is a universally hated career choice and possibly third on the detest list after Tax Inspectors and Bankers these days with Politicians being universally disliked, of course. In the UK wardens patrol the streets looking for vehicles illegally parked even for a short time or even if the front bumper/fender overlaps the authoritative  yellow lines by a few mm.

Why do they exist; the role that is, not the people? What good are they doing for the general public and the fuel duty/road tax cash-cow motorist? Are they here to keep the Queen’s highways, byways and pavements clear of transportation obstacles to allow free flow of vehicles, people and prams? Or, are they here to generate as much revenue as possible for councils and police authorities?

Is their role to gently correct errors, show understanding and guide people on their future behaviour or are they here to discipline, penalise, visually allocate blame with a sticky yellow ticket and generally strike fear and hate into drivers? Should people hide and shy away from traffic wardens and treat them with mistrust or should they be seen as a welcome, integral part of day to day UK living.

Friend or foe? Beauty or beast? Pariah or paragon? 

So what does your Supply Chain team think about your monthly KPI Scorecard discussions within your IBP/S&OP process? Is it a meeting all about blame and backwards looking fault finding and discipline? Or is it what it should be, an open discussion about what needs to be done better by everyone in the current and coming periods?

You certainly must learn the lessons of past shortcomings but applying the learnings to the future is a far more positive and healthy experience for everyone. Supply Chain Analytics can assist you in reaching a much more mature approach to running your business effectively and without people being at each others throats.

Applying a “…don’t look back in anger” approach will lead you and the business to a much more profitable oasis within the market place.

Image courtesy of iosphere at freedigitalphotos.net

 

Tags: FMCG, Dave Jordan, Performance Improvement, KPI, S&OP, Supply Chain Analytics, IBP

An FMCG Success Story; Focus on customers and enjoy the consumer benefits

Posted by Dave Jordan on Mon, May 28, 2018

Once upon a time there was an FMCG company that I will refer to as “Foresight”. “Foresight” had spent many years and many Euros creating a slick inbound Supply Chain.

  • Top class global, regional and collaborative buying
  • Flexible manufacturing network
  • A state of the art ERP
  • Rigorous S&OP as the key business process

Slick inbound Supply ChainWith all those important boxes ticked they must be successful.....but they were not; not even close. In their peer group they were not number 1, top and bottom line growth was getting harder and harder. Throw in difficult economic conditions and the consumption of their product offering plummeted – double digit style. A large FMCG business and quite a few personal reputations were not looking pretty.

The problem was a surprising lack of focus at the customer end of the Supply Chain. Both International Key Accounts(IKA) and the Traditional Trade (TT) were being poorly serviced.

A lot of hard work upstream was being wasted through inefficiency and actually, ignorance. The situation had existed for a number of years but as the same malaise was common in the industry nobody could see the benefit or indeed the need for “getting ones act together”. “Last amongst equals” was hardly a motivating and compelling business proposition for an international big name.

Seeking external expert assistance “Foresight” started out on an adventure that would change the way they approached business at the customer end of the chain.

Customer Service.   This was something “Foresight” thought it was already good at providing but critical aspects were lacking:

  1. Customer Service responsibilities were fragmented and lacked clear and unambiguous leadership.
  2. “Customer Service personnel” had received no training in the subject - nobody really wanted to take responsibility.
  3. “Customer Service” was actually limited to invoice preparation. Proactive interaction with customers and problem solution were not in job descriptions.

This hardly projected an image of a caring “Foresight” and this was a huge risk considering the increasing power of the retailers…. 

Route To Market (RTM). “This is under control for TT and it seems to work”, however RTM was in the Sales black box and that box needed opening and shaking upside down vigorously!

  1. The Distributor RTM network had been in place for several years and was decaying. “Foresight” salesman interaction with Distributors was far from an open win-win relationship.
  2. Several Distributors were simply incapable and/or ill equipped to represent such a major company. Some actually did not wish to be involved.
  3. “Foresight” did not know on whom they could rely in their network or how large and obvious opportunities could be targeted.

In-house Sales bonuses were linked to sell-in and the remaining steps to the consumer were ignored at “Foresight” level and left in the hands of some indifferent distributors.

The cures were not simple or quick but they were effective and the payback was fast and sustained.

Customer Service Centre“Foresight” now operates a centralised Customer Service department looking after customer needs in a standardised and caring manner. Phone calls are answered by someone who wants to help and the customer is not passed from pillar to post trying to find someone interested in their problem. Retailers now see CS staff face to face as they proactively take steps to understand the needs of both sides of the partnership. The Retailer office was once “sales only” and off bounds to other departments but not now and the benefit is clear and significant.

In RTM, “Foresight” carried out a comprehensive assessment of their distributor network making evaluations of all aspects of each distributor’s organisation. The strengths and weaknesses of each partner are now known and understood. “Foresight” now knows where there is receiver capacity to take more responsibility and a leading role in market deployment. Similarly, they also know to tread carefully with a number of distributors who are struggling financially or simply not equipped to meet expectations. “Foresight's” efforts are now focused on those areas providing maximum opportunity and reward. The “one size fits all” approach has gone and distributors are managed as important partners.

In combination these changes have transformed the business and success has been quick to materialise.  “Foresight” enjoys a leading position in its sector while competitors scrap around trying to find growth that is clearly there but they cannot reach.

For “Foresight” at least, they really are able to live happily ever after!

 

Tags: Customer service, Brewing & Beverages, FMCG, Route to Market, Dave Jordan, Performance Improvement, Distribution

Balanced Scorecard KPIs: Keeping Track of Business Performance 

Posted by Dave Jordan on Thu, Mar 29, 2018

How do you keep track of Supply Chain performance within your FMCG, Brewing or Pharmaceutical business? You do, don’t you? If you are not measuring any KPIs then perhaps you should stop here, read this KPI piece and then pop back and carry on.

You can measure and report in many formats as long as you measure appropriate KPIs for your business. One of the most pointless tasks is calculating and reporting a “KPI” which is in fact worthless and of no beneficial interest. Colleagues in Sales & Marketing usually assume they are immune from KPIs as they gleefully sit back and let the Supply Chain guy take the flak at Board meetings. In reality however, the actions of everyone in the company must be reflected in one or more KPIs. If there is anyone in your business who is not impacting a KPI in some way then perhaps you might consider a round of head-count reduction!

The following is a demonstration example of a Balanced Scorecard of business KPIs. While many are indeed Supply Chain related you need only look at Sales Forecast Accuracy to see how other departments can influence that measurement to a far greater extent. KPIs are designed (usually 2 or 3 per discipline) and presented within the company Scorecard.  Target performance threshold levels are agreed (RAG – Red, Amber, Green) and presented monthly within the S&OP process to measure success and target further improvement.

Supply Chain KPIs

There will undoubtedly be more PIs calculated around the business but those in the scorecard really must be the priorities; those that provide actionable information.

The use of simple colour notation allows business managers to see exactly where problems exist allowing them to focus resources. Conversely, you quickly see what is going well and where you might have to raise the bar to maintain and improve further.  (If you are measuring your KPIs at the same level as 5 years ago then that may reflect a business which is stagnating.)

Whatever design you use it does not really matter but:

1. You must measure KPIs relevant to your overall business strategy and performance.

2. You must report them promptly and widely.

3. They must be discussed at the top table, routinely.

4. You must review and delete/insert new KPIs as the business need develops.

5. You must ensure the targets are stretching but achievable as a constant red display is demotivating.

While KPI stands for Key Performance Indicator it could easily be considered as Keep People Interested!

Image courtesy of Enchange.

 

Tags: Brewing & Beverages, FMCG, Dave Jordan, Performance Improvement, Pharma, KPI, Supply Chain, S&OP

Key Performance Indicators or just monthly data dumping? 

Posted by Dave Jordan on Tue, Mar 27, 2018

Last month I spent a few weeks enjoying the UK weather disaster as 10mm of snow brought life to a halt. While there I moved the heiress into her new apartment - not a flat now as student days are over, very posh. Hopefully, that will be the last time I have to manage boxes down a narrow and winding staircase and my glass back can get a much needed rest.

Job done, I made my way back to base with an unpleasant 15 hour delay on BlueAir but at least there was no jobsworth amongst the crew.  Despite the weather I continued my minimalist approach to clothing to ease my way through the various security screenings. I wore no belt, no watch, no metal at all in an attempt to glide through the checks without being patted, prodded or made to make a second pass through the metal detector. Unfortunately, my innocent pack of UNO playing cards looks like plastic explosive, apparently.

The end of the world was in progress on arrival back in Bucharest. Heavy dark and angry clouds were dispensing precipitation by the bucket load and it was relentless. The sleet quickly soaked my UK grade Arctic coat and everything underneath including socks.  Futile attempts at shelter included the held-aloft flat newspaper and the rather dangerous shopping bag with eye holes over the head. Even the all in one little black bin bag number a girl was wearing (or was it a dress?) was ineffective in diverting any of the torrential downpour. This was a real storm without escape where complete saturation was guaranteed and inevitable. 

I felt rather like an FMCG CEO. Saturated by data that people believe he/she needs to see in order to run the business. Not actionable information but raw data. Completely submersed in meaningless numbers and perceived trends. Often, that data is aimed at passing the buck to other departments for failure or lack of success or to ensure backside protection during the post-mortem that takes place long after the month or quarter or whatever period has closed.

Even if you do not run a swish ERP you need to be able to address in-market issues while you still have a chance of making a difference. However, to do that you need to receive information which quickly converts to relevant knowledge and then facilitates actions. To actually see the reality of market performance you don’t need masses of numbers, you need facts.

image.pngIf you don’t have a KPI or Balanced Scorecard then sort one out quickly. If you already monitor performance in this way then take a long hard look at what is actually being reported; is it for the benefit of the reporting colleague/department or for the benefit of the entire company?

Remember that KPIs never tell the full story. When a KPI refuses to improve despite all efforts it may well be due to the impact of another completely different and apparently unrelated measure. In such cases you should adopt a Supply Chain Analytics Approach to deep dive into the detail and really see what is happening all along your Supply Chain.

Image courtesy of SupplyVue at Concentra

 

Tags: FMCG, Dave Jordan, CEO, Performance Improvement, Pharma, KPI, Supply Chain, Supply Chain Analytics

A Practical Guide to FMCG SKU Complexity Reduction 

Posted by Dave Jordan on Tue, Mar 20, 2018

If your business is struggling to cope with day to day sales while managing innovation and range extensions then give your SKU list a thorough review. Not just a cursory glance but a scientific evaluation of what brings in the profit and what eats at the same. Few businesses are lucky to operate with just one or two monster SKUs but an excessive list of items on the price list can severely affect your customer service performance.

In the customer service link above we looked at the cost to have a single SKU on the books and it is not insignificant when you take all elements of supply into account. If SKUs do not pay for themselves and contribute to the bottom line then why do they exist? SKUs plodding along with low margin AND low sales turnover cannot be worth the cost and effort of maintaining them, can they? They are simply getting in the way of potentially more profitable SKUs.

If you could base your business on high margin/high turnover SKUs then of course you would. Life is not that simple and the market place is ever more competitive so you need to constantly review the wisdom of what you are putting in front of consumers. Unless your business is in dire straits a large proportion of your SKUs will be either low margin/high turnover or vice versa. Both situations can provide reasonably healthy growth but wouldn’t it be better if you could edge them towards the high/high green quartile as per the diagram below?SKU ComplexityThe first step is to make a very rough estimate of what your business spends on keeping an SKU on the price list. This is not an accurate science but you need to put a “stake in the ground” and agree a number, say 30,000Eur. If the margin of a particular SKU does not at least break-even then delisting should be considered. Staff who look after those SKUs in the yellow segments need to be challenged on a quarterly basis to get their SKUs away from the red and towards the green, or delist.

If you carry out such an assessment and find that a majority of your SKUs are in the red segment then you might benefit from a professional spring clean of your portfolio. Such an approach will remove any emotion and bias when clinically assessing what you should be placing on shelves.

Image courtesy of Enchange at Enchange.com.

 

Tags: SKU, FMCG, Dave Jordan, Performance Improvement, Pharma, Supply Chain Analytics

CEO FMCG Letter to Santa Claus (aka Father Christmas) 2017

Posted by Dave Jordan on Sun, Dec 17, 2017

FMCG/Brewing/Pharma CEO Letter to Santa ClausDear Father Christmas,,

I have been a very good FMCG CEO this year, I promise. If you want, you can check with my colleagues and shareholders. They know how good I have been this year. Apart from the out of stocks of course, oh and the little mistake when we had to write stock off and waste lots of our money. But that is not so bad is it? Other CEOs were naughty last year and they still got what they wanted from you.

I had better be honest because you will know if I am not telling the truth. We also had a problem starting S&OP and so our planning, forecast accuracy and therefore  sales were not very good. They were not really big problems so I hope you can forget about them this time, please. Next year I promise to do better, I do, honestly.

I forgot about the Route To Market (RTM) mess we had in the peak sales months but that really was not my fault. I also promise to do something about RTM next year and make sure it works properly so people who buy our products are not disappointed. I know it is bad when people come to buy our products and then spend their money on something else. I will talk to our distributors and find out what we need to do.

I know, I know, when the new ERP computer system was switched on we were not really ready for the change but we did make it better as fast as possible. I did not think we needed any outside help for the new IT but I admit I was wrong. Next time I will get it right, hopefully without having any lost sales.

The factory thing was not my fault, I think. The factory man promised me lots of product but his machines kept breaking down at the wrong times and we had to wait for the fixing men to arrive. They took ages to get the machines working and then they broke down again and again. No, it is not a very reliable factory, yet.

Does the warehouse problem count against me as well? We could not find our products when we wanted them and then when we did find them they were old and out of date and of no use. This was very sad but it will not happen again next year, I hope.

I have just read my message again to make sure I did not spell any words wrong and I see I was not as good as I thought. Actually, after reading this I am going to the chimney to take my stocking down and put it away in the Christmas storage box. I will try again next year, Santa.

Bye bye and Happy Christmas.

CEO FMCG

Image credit: HikingArtist.com

Tags: Route to Market, Christmas, Logistics Service Provider, Dave Jordan, CEO, Humour, Performance Improvement, Traditional Trade, S&OP, Sales, Inventory Management & Stock Control

An FMCG Distributor Is For Life & Not Just For Christmas

Posted by Dave Jordan on Thu, Dec 14, 2017

Ok, so you are unlikley to see this on a car bumper sticker but FMCG Distributors will have a significant impact on your sales performance, probably your variable pay bonus and therefore your CEO aspirations! How have you treated your Distributors this year? Were they the usual pain in the proverbial - failing to achieve targets, not paying on time, always moaning about trading terms? Of course, some Distributors do fit this stereotype but others are keenly trying to be treated as and to be, equal partners in your business success. But do you see this?

How are things going in Q4? Have you fallen into the trap of the “sales bonus push”? Year end stock clearance FMCG Breaking all the supply and sales phasing rules you have been trying to drum into Distributors? Did you strictly maintain discipline on Sales & Operational Planning or did the last quarter deteriorate into a “sell whatever we've got in the warehouse” scenario?

Companies that spend time and effort in proactively guiding their Distributors, providing relevant training and support inevitably succeed in the market place. Yes, at the end of the day Distributors have to stand on their own two feet but so many FMCG companies assume an organisation calling itself an “FMCG Distributor” inherently knows how to properly support any specific business.

If you do not pay attention to the Traditional Trade (TT) distribution side of your business then you are asking for trouble and that trouble usually ends in divorce along with all the discontinuity baggage separation brings. You need to avoid your choice of Distributors becoming like the English Premier League where managers get about 5 minutes to make an impact before being shown the door. (Strange though, that all these football managerial failures usually find another highly paid role; the latest being Big Sam Allardyce)

So, as we approach a special time of the year why not think about your Distributors and ask yourself if you have given them a fair crack of the whip?  If not, then you might consider a New Year resolution to develop a strategy for mutual success. This is far better than continually highlighting deficiencies and using backward looking, discipline focussed KPIs to bash them on the head.

Sit down with your RTM Distributors regularly, evaluate their strengths and weaknesses and agree to do something about the latter. Simply running through a Route To Market evaluation together can work wonders in establishing trust and cooperation. Do yourself a favour and do this now before Q1 next year also becomes history that you cannot change.

Click on the RTM link below and go!

CTA RTM Free Download resized 600

Image courtesy of stock.xchnge at freeimages.com

Tags: FMCG, Route to Market, Dave Jordan, CEO, Performance Improvement, Supply Chain, S&OP, Distribution

FMCG Trade Loading & 4th Quarter Challenges - deja vue all over again!

Posted by Dave Jordan on Mon, Nov 27, 2017

Some things never change and FMCG 4th Quarter challenges certainly do not. The same challenges are clearly present and what is astonishing is that some companies are still making short term, expensive efforts to “make the sales numbers”. I don't think that is very clever; instead of pouring cash into a black hole without guaranteed return why not divert resources to sort out the underlying problems? They will not go away on their own!

There is a little bit of growth in the market but those green shoots are still relatively puny. Assuming growth is to return, those companies that had the vision to be critical of how they do business in difficult times will be the winners. All the others will be achieving the numbers by loading the trade….again and again.

You should have a good feeling for how things have gone in Q3 and what is still needed in Q4 to reach the numbers you committed to over 12 months ago. "Committed" may well be the wrong word as you were probably forced/cajoled/persuaded to accept figures you knew would be difficult if not nigh impossible to achieve. However, for the greater corporate good you took it on the chin and said “yes, we will do it” (no idea how but cést la vie).

Exactly how are you going to achieve those seemingly distant numbers? The corporate world remains in trouble but so are consumers. The two groups are not disconnected; consumers are having a very tough time considering the increasingly clueless government austerity measures that continue to drip out around the globe. Consumers simply do not have the money to prop up your annual plan and what money they do have is likely to be rationed to be sure of a reasonably happy Christmas. Remember, consumers owe you nothing, not a penny!

One thing you may consider if sales are not going well is to fall into the trap of month-end loading. Let us consider this scenario which is far from uncommon even in “blue-chip” companies. Let us assume October sales are poor in the first 2 weeks and then the word is given to “push” stocks into the trade. Discounts are given, favours called in and hey presto, the required target number is achieved and you and your bosses think you are back on tSupply_chain_sales_planning_results.jpgrack.

You have pushed so much stock into the trade that distributors are short of cash and International Key Accounts platforms are overstocked. Consumers do not drink more beer or wash their hair more often or eat extra snacks because you sold at a discount. They have taken advantage of your offers and have filled their own domestic warehouses ready for Christmas and possibly beyond.

Then we get to November. This time sales are poor into the third week and the rallying call of the stock push does not seem to be working. Support  and discretionary spend budgets are raided again and yet more stock is forced into places where it has no demand. Despite this, the motivation of achieving targets and securing a bonus ensure that the right number is flashed to HQ at the end of the month.

Now just December to get through……even if it is really only a 16/17 day month for selling. You are so close that a few more discounts and the promotion of high value SKUs means you close the year on target. It’s that champagne moment, get the fat cigars out!!!!

Sit down and think about what you have just done for the sake of a slap on the back and a bonus. You have turned the operation of the company upside down, contravened numerous policies, abused S&OP (if you use it) and unfairly stretched your staff in all departments. 

If you are brutally honest you will know you have sold January’s demand over the last quarter the year. You will not get away with that for long as it will come back to bite you eventually!

With stretched resources it is difficult for companies to see what is really happening across all departments and how decisions in one area cause a detrimental effect in another. If you insist on chasing the full year numbers/bonus then you might at least take on some professional support and understand the damage you are causing to yourself.

Image courtesy of Stuart Miles at freedigitalphotos.net

 

Tags: FMCG, Dave Jordan, CEO, Performance Improvement, S&OP, Forecasting & Demand Planning, Sales, Distribution, Integrated Business Planning

NHS UK Supply Chain Waste: Planning Patience

Posted by Dave Jordan on Thu, Sep 28, 2017

I have spent some considerable time visiting medical facilities both at home and in UK and in the latter case I was not impressed. The National Health Service is still the envy of the rest of the world and rightly so. When you consider the policies and procedures in other countries the people who benefit from the NHS really should not complain about a 4 hour wait as you will be seen and you will not be asked if your bank card is contactless before you get to see a medical professional.

The NHS is struggling but I think that is partly due to people using the A&E facilities for an ingrowing toe nail or a stomach upset after a magmaloo curry (search that and Jasper Carrott) the night before. The strain on the service would be a lot less if treatment really was restricted to people who have bits hanging off and when life is under threat.

There is another area where the NHS struggles and that is on their supply chain. Yes, it is of course complicated; it is hard to demand forecast what accidents and illnesses will be wheeled through the doors and it is a supply chain that must deliver. Essentially everything should be available, everywhere at all times of the day in a non-stop operation. You cannot be out of stock on surgical sutures and make do with a bit of masking tape or ask the patient to "press firmly here" until replenishment arrives.

As a result, I saw horrendous waste on an hourly basis. Medicines, bandages, food (yes, I know it's not too clever anyway), utilities and perhaps most importantly, staff time and beds. At a time when the NHS is thought to be lacking beds I thought this was perhaps the most serious fault as waiting time for beds is high. Indeed, many non-urgent operations are cancelled as beds are apparently not available. Yet, beds were vacant and beds were still occupied by cured and dressed patients waiting for transport home.

SUPPLY_CHAIN_PLANNING_FORECASTING_costDrugs were delivered for people who had been discharged or even sadly died. Not one bit of this was deliberate but there appeared to be a frailty of planning. I am certainly not suggesting the operation of a 24/7 nationwide NHS is an easy operation to run but I do feel some of the waste listed earlier can be avoided but not by rigidly sticking to current practises and procedures. That clever bloke Einstein defined doing the same thing over and over again and expecting different results, as insanity.

I would be similarly insane to say all the problems can be solved easily but when I met with the equivalent of the Ops Director at one major hospital in an English city currently without any Premier League teams, I was rather shocked. There was tacit agreement that numerous problems existed and there was an understanding of the improvement suggestions I made but then she bluntly played the Einstein card. You can only advise the NHS IF you have previously advised the NHS. What? Surely that is a recipe for a rapidly downwards spiral of inefficiency leading to collapse. Think out of the box!

I believe the NHS could learn from industry and even correction of a few basic errors mostly linked to simple data and information flow could deliver substantial sums. In 2015/16 the NHS budget was £116 billion, yes 116 billion of our weakening pounds. That is a serious amount of money that is not being well spent in some areas, in my humble opinion.

I asked the Ops Director what her biggest challenge was and I expected the answer to be a secure electricity supply or clean water or drugs availability etc, but was just a little surprised to hear she gets the greatest grief from bosses when...... the entry barrier does not work on the visitor car park.

Image courtesy of Stuart Miles at freedigitalphotos.net

 

Tags: Dave Jordan, Performance Improvement, Supply Chain, Forecasting & Demand Planning

Supply Chain Performance: Budget Airlines and KPIs……

Posted by Dave Jordan on Wed, Jun 14, 2017

I have never been a fan of budget airlines and certainly not since one left me sleeping overnight in the back of beyond that is Luton Airport. That may be an exciting addition to a student’s back-pack holiday itinerary but when you have a glass back it is not so appealing.

Nevertheless, they do fly to or near to where I need to be and the prices are much cheaper if you book well in advance, don’t pay with a credit card, don’t carry any luggage, don’t eat or drink, wish to sit next to your wife or use the toilet (thank you Fascinating Aida).

So, once again I found myself on the busy Birmingham – Bucharest route after visiting the heiress and some things are inevitable on a no-frills airline. I know the dimensions of my carry-on bag but so many others either forget to check or think they will get away with a dayglo sausage the size of Sicily without paying the penalty fare. That’s how they make their money; last minute, extortion, take it or leave it.

My second frequent observation is that there is usually someone sitting in my seat when I board. Yes, they move when challenged but only to another seat which is not theirs either. I know some airlines do or did provide a free seating/chaos policy but when you have a seat allocated on the boarding pass, sit in it!

Finally, we are off the ground and ascending before soon the engines throttle back and this is when I want to shout out some helpful advice to the captain, “change gear now”. I know how planes work but that bit off take off always makes me uncomfortable. The beep of the seat belt sign going off leads to an immediate dash for the toilets (I hope they pre-paid) and a long line of shuffling bodies.

The line of casually shuffling bodies soon turns into a twitching queue of concern as the red toilet sign above the cabin remains illuminated. Phones are consulted to pass the time and refocus the mind; people even read the safety information booklet and the duty-free magazine which is anything but duty free, of course.

Finally, a Flight Attendant needs to transport a metal trolley on inedible stuff to the other end of the plane and realises she cannot possibly conquer the lavatory line and politely knocks on the toilet door. No answer. Another tap-tap-tap plus an enquiry if everything is OK also fails to change the indicator from no-go red to free flowing green. The red light seems to glow brighter as if to irritate those with crossed legs.

This is now serious as the inedible stuff is getting cold and more people are standing in the aisle than sitting in seats. The pilot is probably having to battle with the controls to keep the plane centrally balanced. Something must give and judging by the faces of the queuers, this will be very soon. The red light glows.

Then action; the queue is guided away from the toilet door and back behind the curtain. Male and female crew members are poised to open the door using the emergency switch and they don’t know what or whom they will find. The door is cracked open as male and female eyes strain to see which crew member will take the lead and help the possibly stricken passenger. The red light vanishes and the green for go appears above the curtain. Relief is at hand.

There’s nobody in the toilet. The grateful mass of people takes one step forwards as the end is finally near.

FMCG_SUPPLY_CHAIN_HUMOUR_KPI_ANALYTICS.jpgSo, what went wrong? Will the cleaning service at the destination find something a very unexpected item in the garbage area? Is someone hiding in the skin of the aeroplane plotting something nasty?

There was never anyone in the toilet in the first place and staff had forgotten to flick the switch to make it open for business. The red light stayed illuminated but it was not telling you what the real situation was with toilet occupancy and the impasse was allowed to go on for quite some time. The KPI (kay pee aye) was showing red but it was not telling you the reality and certainly not everything.

Don’t always believe your KPIs are telling you the whole story; challenge them routinely. They are frequently an indication of performance at a certain moment in time and a longer-term view is necessary as the business evolves. If your business is in trouble you may need a set of Recovery KPIs whereas a booming business on a roll may need a set which is far more forward thinking and aggressive. Supply Chain Analytics help you take the longer term view.

Blindly believing long term over or under performance can see your company quickly performance go down the pan.

Image courtesy of phasinphoto at freedigitalphotos.net

Tags: FMCG, Dave Jordan, Humour, Performance Improvement, Pharma, KPI, Supply Chain, Supply Chain Analytics