Operational Decisions
The annual budgeting and strategic planning cycle that most companies go through each year intends to align the company to strategic goals and objectives that ultimately drive more value to the shareholders and stakeholders. Significant time and resources are spent in this cycle, but is that the right place to invest? Granted these decisions have a large impact, swings of finances and direction, and should have attention, but what about the hundreds and perhaps thousands of operational decisions that are made every day by the operational staff? How much time and capital are invested in these most critical assets. Yes, you read that correctly. Why should we not treat operational decision making as a corporate asset?
Digital Transformation
Modern day manufacturing and production facilities continue to have their “hands tied’ by relying in silo systems and “human glue” to make these operational decisions. ERP and PLM systems exist to make similar types of decisions for finance and product respectively. Linking the product, process and operational decisions together on an enterprise decision support system can shrink the lag I spoke of in my last blog and enable staff to solve the difficult and truly enabling problems for their industry. When strategic staff set the course for the next few years for production and manufacturing, the entire company must be aligned. Product and Process Engineering, Marketing, Operations and the entire Supply Chain must work in synchronization. As we know, these departments can operate in silos and own their data, with disconnected systems and even worse, disconnected business processes. Digital transformation seeks to connect these teams digitally and reduce the “digital debt” that hinders proper decision making. In fact, we could take it one step further to optimize this level of decision with simulation and use case propositions to ensure optimal operational decisions are made. This would imply that strategic decision making would improve.
In practice, this outlines and suggests a new way of making decisions must be developed with strategic teams setting the key performance indicators (KPIs) and operating metrics enabled by an operational decision support platform that can be leveraged to ensure optimal achievement. This platform, an enterprise decision management system, works across the silos of data by breaking down the walls of data ownership to assign the proper team to own and support the decision making process, thereby investing in creating a systematic decision making process seems a good use of scares resources. Once staff become comfortable with the outcomes, would one not assume these decisions could be automated via business processes?
Enterprise Decision Management System
Creating an enterprise decisions management system in the form of a single platform that spans the value chain of operational decisions can have a triple impact effect. First, the operational staff are fortified with an accurate normalized set of data with proper accountability that reduces finger pointing and reduces the decision lag (i.e. Agilibility) in daily operations. This stability and accuracy brings clarity to strategic achievement of corporate KPIs and objectives; the annual plan. Finally and perhaps most important, in a sector that relies heavily on people, a universal decision support platform brings the learning curve down for these critical operational decisions so staff can become more efficient and effective sooner. All aspects increase agility and competiveness in today’s challenging space.
This blog is the third in a series of four on Planning and Optimization. Get caught up with “Agilibility– Are you an Agilist?” and “Knowledge May Imply Power, but Action Rules the Day.”
Are you looking to become an Agilist or increase your supply chain velocity and agility? Reach out the DELMIA Operations Consulting Team at Dassault Systems to see how we have changed company’s ability to respond to disruptions and change.
