RICHARD WILDING/SUPPLY CHAIN AUDIO PODCAST, EPISODE 1
NEVILLE HOBSON: Welcome to the www.BusinessAssurance.com Supply Chain
Podcast series. My name is Neville Hobson.
This podcast is episode one of a three part series. The series is made up of
interviews with Professor Richard Wilding from Cranfield University, one of
Europe’s top supply chain management experts.
In this episode, you will hear Richard talking about the most important basics of
successfully managing Global Supply Chains.
RICHARD WILDING: Hello, I am Professor Richard Wilding. I am Professor
of Supply Chain Management at Cranfield School of Management. Cranfield
School of Management is one of the top European Business Schools and at
Cranfield our whole philosophy is about getting knowledge into practice.
NEVILLE HOBSON: Richard gives us his definition of what a supply chain is:
RICHARD WILDING: Everybody has an idea of what a supply chain is, and
for different companies supply chains will be different. I often get people to think
about when you hear the term supply chain, often people immediately think about
lorries and warehouses; this is probably because most lorries and lorries you see
have supply chain written down the side of them. Of course, that is only one small
aspect of managing a supply chain. In fact, if we look at a definition of a supply
chain, a simple definition would be “out of the ground and back into the ground” its
actually moving material out of the ground and back into it. So when you think
about any product, we have to make/produce that product, but also now we are
having to consider actually recycling that product as well and getting it back into
NEVILLE HOBSON: He went on to give us a very entertaining version of the
history of supply chains:
RICHARD WILDING: Are supply chains something new? Well, actually no. If
you go to your bible you will find the story of Joseph. Now, Joseph I guess we
could define as one of the first supply chain managers. He worked for Pharaoh in
Egypt, he managed a series of warehouses during the years of plenty, he was able
to stock-up this warehouse, and then he actually managed the distribution of food
and so on and so forth out across the nations at that time. So if we look at supply
chains, the supply chain concept, it is something which we have always had in
society. Modern supply chains of course are slightly more complex. Modern supply
chains extend, well all around the world. We are finding that we are buying
products from nations such as China, Vietnam; we are in a global economy. So the
challenges we now have in terms of managing supply chains, is really their global
reach. But of course, we have technology to support if you like the movement of
materials and information, to enable us to be able to manage supply chains within
NEVILLE HOBSON: He talked to us about some of the biggest changes that
he has seen in his 20 years in the business:
RICHARD WILDING: I think one of the biggest changes that we have seen in
the industry over the last sort of 20 years or so, is really the capability of
implementing the supply chain concept. If you think that really supply chain
management requires the integration of processes; no longer focusing on silos
within organisations, but thinking of about the process of creating value for people
and also doing this at a lower cost. Now we have to do that within our own
business, but we also need to be able to do that externally to the business.
Information technology for example has made a massive impact on the supply
chain; because that has enabled us to move information more effectively across
the supply chain, create higher levels of transparency of where raw materials are
and other products and other resources within that supply chain.
So, big changes you are seeing an evolution of a concept. An evolution where
people saw supply chain as more of a truck and sheds issue, as it were, just
focusing on warehousing and the transport operation. But now are recognising that
this is something which integrates everything from design or concept, right through
to the return side of things as well. In other words, getting the product out of the
ground and ultimately back into the ground and that is one of the big changes that
we actually find.
NEVILLE HOBSON: Richard talked about getting supply chains to add value
to global brands:
RICHARD WILDING: As I mentioned, supply chains add value. So, what do I
mean by that. The point is now that generally the individual product just supplying
a product is just a qualifier. If people buy the product, most products are becoming
commoditised in their nature, they are not really very, very special in terms of what
you are buying. If you are buying an MP3 player, of course there are some big
brands, but an MP3 player as such is just a commodity. So what differentiates
those brands? Well for many situations, one thing can differentiate the brand, is
your service, for example. How do serve the customer, and the supply chain is
responsible for service. Is your product available? There is no point in having a
great brand, if your product is not available to actually buy off the shelf. And the
supply chain is responsible for ensuring that that item is on the shelf.
NEVILLE HOBSON: Richard points out one of the most common mis-
conceptions about global supply chains:
RICHARD WILDING: One of the big common misconceptions about supply
chain management is thinking that this is an individual function. It is something
which is responsibility of an operational function, its just all about lorries, its all
about warehouses and a little bit of manufacturing. I find this a very dangerous way
to think about the supply chain. The point is that the supply chain really is a
process which touches all elements of your business and therefore it is more about
the integration of these various functions within an organisation and, also
externally to it.
NEVILLE HOBSON: He went on to explain the importance of integration
across all areas of your supply chain:
RICHARD WILDING: The problem is that if you optimise your warehousing, if
you optimise your manufacturing, if you optimise your transportation, what you end
up with is a very dysfunctional supply chain. For example, optimising a warehouse
might mean that you have queues of lorries waiting outside so you can prove the
efficiency of your loading. Optimising your manufacturing will mean that you are
going to produce very, very big batches because that is the cheapest way to
produce that particular product. But that is not going to be very good for your
warehousing for example, and for some other elements of the supply chain.
So what we have to do is to really get into our minds a sort of an end to end way of
thinking. And if we can actually deal with that and create an organisation which is
focused around the process of the chain supply, and that benefits us all, it reduces
costs and also enables us to enhance value within that environment.
NEVILLE HOBSON: Richard’s three T’s of supply chain management are his
trademark. Here he talks about them:
RICHARD WILDING: World class supply chain management requires quite a
few foundational principles. First of all, I think the key thing is an understanding of
the time dimensions of the supply chain. Most of the time, we are having to
compete through time. Not through cost. Cost is an element, but at the end of the
day, time is a more important dimension that we are having to deal with in many
markets. By understanding time and understanding the nature of time, and
recognising that its often the „x‟ axis on every graph we produce, once we
understand that x axis of time, we can start plotting process against time, cost
against time, inventory against time, value against time, demand against time.
That‟s again our transparency for us, transparency of what‟s actually going on and
when we have transparency people can see what‟s going on, they actually trust
that things are going to happen and trust is a foundational principal. So I talk about
the three „Ts‟ – time, transparency and trust.
NEVILLE HOBSON: You have been listening to a www.BusinessAssurance.com
podcast on managing Global Supply Chains with Professor Richard Wilding from
Cranfield University, one of Europe’s top supply chain management experts. For
information about Cranfield, visit www.cranfield.ac.uk.
Managing Global Supply Chains is one of a series of podcasts from
www.BusinessAssurance.com . Others include climate change and supply chain
assurance. To listen to or download any of the episodes in the series, please visit
This podcast has been brought to you by Lloyd’s Register Quality Assurance,
LRQA. For more information on LRQA, visit www.lrqa.com.
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