Case study :Global Supply Chain Transformation- People centric and Agility-(1st part )
The Global Transformers Manufacturer Group is a prominent multinational group with its parent company based in Italy and two subsidiaries, one in China and the other in Tunisia, collectively employing 435 individuals.
The group specializes in the mini-electronic and electromechanical transformers industry, catering to diverse client that includes multinational corporations in various geographical locations and markets, such as ABB, Siemens, Toshiba, Ed Vision, and Samsung. Despite being part of the same conglomerates, these clients have distinct requirements and operational expectations.
In recent times, the group has encountered significant challenges related to increased global lead times and direct costs, which have led to a decline in profit margins. A thorough cross-entity analysis was conducted to identify the root causes of these issues. The analysis revealed that the primary factors contributing to the group's problems were conflicts arising from a siloed approach between legal entities and a consequent culture of blaming.
From a supply chain perspective, the client-supplier relationship that was established during the subsidiaries' inception facilitated the transfer of knowledge and best practices. However, this relationship also created a strong interdependence between the Italian parent company and its subsidiaries in China and Tunisia. The control and direction from Italy regarding technical development and quality were micro-managing overseas managers, which further exacerbated the challenges faced by the group.
Upon utilizing a self-assessment model to evaluate the supply chain maturity level, it became evident that the group's maturity level was at a basic stage. To achieve the next affordable level of organizational development, the group would need to adopt a co-managed approach for the nodes within the supply chain. This would involve implementing forecasting and demand management in an integrated space, coupled with advanced planning to establish proper end-to-end visibility and unified processes.
The proposed solution aimed at transforming the supply chain maturity model into a more collaborative framework. However, such a project would necessitate significant transformation activities, involving three distinct countries and their respective national and business cultures, with a strong emphasis on people.
To successfully execute this project, it was crucial to address the existing conflicts and cultural differences between the Italian parent company and its subsidiaries. Additionally, the group needed to re-evaluate its managerial practices, focusing on fostering a collaborative environment that encouraged effective communication, trust-building, and problem-solving.
One of the primary challenges in this endeavour was understanding the diverse cultural contexts of the three countries, their varying managerial styles, and the influence these factors had on the overall group dynamics. This necessitated a comprehensive analysis of the stakeholders involved, their national and business cultures, and the possible impact of these elements on the implementation of the proposed solution.
Moreover, the group had to ensure that the transformation process was flexible and adaptable, taking into consideration the unique characteristics of each subsidiary and the specific challenges they faced. This required a willingness to experiment with new ideas, learn from setbacks, and continuously refine the approach to achieve the desired outcomes. An Agility adoption between the three organisational and legal entities maintaining each organisational structure but working as an unique organisational entity.
In conclusion, this case study highlights the importance of addressing the human element in any change or transformation initiative. By focusing on fostering a culture of Agility including collaboration, mutual understanding, and shared values, the group can overcome the challenges posed by its diverse workforce and achieve the desired improvements in its supply chain management processes.
With a well-thought-out plan and a strong commitment to continuous improvement, the group could effectively navigate and adapt and react to the complexities of the global and local business landscape enhance its competitiveness, and ultimately, ensure business continuity first and successful growth.