Post on 14-Apr-2017
Supplying Innovation: Unlocking innovative behaviours in the
supply chain
Keith Wishart (IBM), Jingchen Hou (CSA)
Cambridge Service Alliance Webinar Series 9th May, 2016
Content
Theproblem:theinnova1onbo2leneck
单击添加目录内容2
Majorstakeholdersandkeychallenges
Keysuccessthemes
Discussionsandconclusions
Thesolu1on:formanalliancetodeliveroutcomes
Thebackground:thechangesinindustries
The background: the changes in industries
• Weconductedthiscasestudyinanu/lityindustryintheUK,butthefollowingchangesarenotlimitedtooneindustryandcanbeobservedinmanyindustries.
Customerfocused
Endcustomersarepaidunprecedenteda?en/onto.
Outcomeoriented
Outcomesinsteadofoutputsaredemanded.
Highcomplexity
Itisdifficultforonecompanytodeliveronitsown.
Innova/ondemanding
Innova/oniscrucialtofulfillstakeholders’demands.
The problem: the innovation bottleneck
Innova1onislockedwithinfirmsinsteadofinthesupplychain
Innovation bottleneck
Tradi1onalcontractsdonotprovideenough
incen1vesforoutcomes
Tradi1onalcontractualrela1onshipsimpede
jointinnova1on
Internalinnova1onoBenfailstogenerate
expectedvalue
Thedeliveredsolu1onsdonotimproveclients’
performances
Endcustomersdonotobtaintheop1mal
servicesandoutcomes
The solution: form an alliance to deliver outcomes
TheshiIfromoutputstooutcomes
Suppliersarerewardedonoutcomesforendcustomersandotherstakeholders.
Endcustomersareincludedforconsidera1onaskeystakeholders.
Someresponsibili1esandrelatedrisksaretransferredfromclientstosuppliers.
Theforma/onofanalliance
Mul1plesuppliersandtheclientformanalliancetojointlydeliveroutcomes.
Theallianceisrela1velyindependentofitspartnercompanies.
Thecleardis1nc1onsbetweensuppliersandtheclientfadeaway.
Major stakeholders of the alliance
Keystakeholders
Theclient
Otherpartners
Endcustomers
Extendedsuppliers
Theregulator
Key challenges
Insidethealliance
• Partnershavedifferentbusinessmodels.• Limitedexperiencetodeliveroutcomes.• Partnershavedifferentpastrela/onships.• Partnerscompeteoutsidethealliance.
Outsidethealliance
• Thewholeindustrywasnotcollabora/veandtrus/nginnature.
• Thewholeindustrywasoutputdriven.• Theindustrylacksinforma/ontransparency.
Collabora/onchallenges
Outcomemodel
challenges
Key success themes
Strategicobjec/vesOrganiza/onalculture
EngendertrustEduca/onalcommunica/ons
Commercialsolu/on
TotexfocusRisk&rewardsharingBenefitsrealiza/onIncen/vizesuppliers
Opera/onaldesign
Con/nuingeduca/onInforma/onplaTorm
ProcessdesignMetrics/Measurements
Collabora/on
Keysuccessthemes
Key success factors – collaboration
• Suppress competitive behaviours and foster trust
• Achieve the shift in mind-set through educational comms
• Create a positive organizational culture based on partners’ cultures
• Define the strategic objectives based on the outcomes to be achieved
Strategicobjec/ves
Organiza/onalculture
Educa/onalcomms
Engendertrust
Key success factors – commercial solution
• Facilitate the choice of optimal solutions that deliver outcomes
• Incentivize extended suppliers on outcomes where possible
• Benefits and risks are shared among partners; outcome KPIs are transferred to the alliance
• The boundaries between capital and operational expenditures are eliminated
Totexfocus
Risk&rewardsharing
Incen/vesuppliers
Benefitsrealiza/on
Key success factors – operational design
• Design processes for everyday operations
• Measure contributions of partners, track the achievements, etc.
• Design platforms for the sharing of data, knowledge, and capabilities
• Training sessions on customer focus and outcome thinking
Con/nuingeduca/on
Informa/onplaTorms
Metrics&measurements
Processdesign
Discussions and conclusions
• Thethreekeysuccessthemes–collabora/on,commercialsolu/onandopera/onaldesign–mutuallyreinforceeachother.
• TheshiIfromoutputstooutcomesimpliesincreasedresponsibili/esandrelatedrisksforsuppliers,butalsoflexibilityandopportuni/es.
• Theforma/onofanalliancetodeliveroutcome-basedprojectsprovidesopportuni/estounlockinnova/oninthesupplychainandtoaccumulatecapabili/esfrommul/plepartnerstomeetcustomerdemands,tofulfillregulators’requirements,andtogeneratebenefitsforpartners.
• Therearerealchallengesfordeliveringoutcome-basedcontractswith
analliance.Sothismodelisnotforeveryproject,anddecisionsshouldbemadecarefully.
Thewhitepaperiswri?enbyJingchenHou,KeithWishart,JonathanBaker-BrianandClaireVine.Itcanbeaccessedfromh?p://cambridgeservicealliance.eng.cam.ac.uk/news/2016MarchPaper