How strategic operations connect the dots to enterprise performance

Operations should be seen from the customer’s lens. Making decisions based on integrated data can help companies balance demand and supply.

Here’s the question that every supply chain and operations leader should be asking. In a post-pandemic and ever-changing world, how can we make sure our operations are nimble enough to consistently meet and deliver what our customers want? Shouldn’t supply chains be less of an organizational afterthought and instead be at the epicenter of operations driving integrated decision-making with business functions from sales and marketing to product development to finance to procurement and manufacturing? With an extreme focus on supply chain costs leading up to 2020, it is easy to see why that idea hasn’t been a priority up until now.

Supply chains have been viewed mostly as a cost center, with executives paying little, or not enough, attention to their central importance for their organizations, and their critical role in overall business performance. With years of supply chain instability; increasing customer expectations; balancing global, regional and local supply networks; and geopolitical uncertainties ahead, the industry has reached an inflection point.

In fact, supply chains are at a critical juncture, and it’s time for a 180-degree about-face for us to think of operations – led by supply chains – as a key to strategic competitive advantage. Doing so – adopting enterprise-wide, integrated operations practices focused on efficiency and growth, and the emerging technologies that now enable this – will deliver the kinds of insights that can improve top and bottom lines and elevate customer satisfaction to new levels.

What happens when we get strategic operations right?

Consumer demand and expectations are accelerating, and the speed to respond or stay ahead of change won’t slow down. A truly integrated strategic operations approach enables rapid response to shifting market conditions or changes in consumer preferences and behavior that previously might have taken months or more to enact. But there are other benefits too. An organization aligned around strategic operations also heightens employee satisfaction by reducing complexity and helping employees focus on the things that are most important to the success of the business. Enhancements to delivery times, improvements in quality and better value pricing create customer satisfaction; build reputation; and deliver, over time, a competitive edge.

Last word

The ultimate goal with operations should be to create a much more strategic organization, with supply chain leading the way and using GenAI and other technologies to link together sales, marketing, finance and operations to create real competitive advantage. This may require evolution of operational models beyond technology, such as the addition of micro fulfilment centers, to meet booming local demand. But the rewards will be significant. Our work with AI solutions and strategic operations consulting with a large US retailer helped the retailer move from traditional demand forecasting to managing orders at the customer level. This effort delivered more than $300 million in network overhead savings and improved customer service levels, thus creating a supply chain-driven sense-and-respond organization. This kind of transformation can be possible for organizations that choose to embrace and focus on strategic operations that unify their direction as 2024, and beyond, unfolds before us.