Suggestions
Knut Alicke
Partner at McKinsey & Company, co-Author #SourceToSold, Supply Chain Therapist
Knut Alicke is a Partner at McKinsey & Company and a Professor at the University of Cologne.12 He has been working at McKinsey since 2004, starting as a Specialist and progressing to his current role as Partner, which he has held since January 2012.1 At the University of Cologne, Alicke has been a Professor since October 2012.1
Alicke is an expert in supply chain management, serving as the Head of Supply Chain Europe for McKinsey.34 His areas of expertise include digital supply chains, advanced analytics, and supply chain transformations.4 He advises clients on various topics related to manufacturing and supply chain management.3
In terms of education, Alicke holds a Dr.Ing. habil. in Mechanical engineering, logistics, and supply chain management from the Karlsruhe Institute of Technology (KIT), which he attended from 1988 to 2001.1
Alicke is also an author, having written several articles on supply chain-related subjects and a book titled "Planning and operation of logistics networks: cross-company supply chain management" (in German).3 He is recognized as a global expert on operations, supply chain, and risk management.3
His LinkedIn username is knut-alicke, as mentioned in the query.
Highlights
Did you classify your customers in Platinum, Gold, or Silver? Such a segmentation is a great idea IF it is applied along the E2E value chain. In my experience, a consistent use of the segmentation is often missing.
In the below (sanitized) example I plotted different customers with revenue, OTIF we manage to deliver, and the importance according to the different classes.
What we often see is a low service level for the Platinum customers, whereas Silver customers receive a pretty high service and are above the target (in this case 95%).
How can this be? 🎷 LSFS (loudest shout first served) policy – the Silver customers do call regularly to ask for an update on their orders and this pushes their importance up. Platinum customers assume a premium handling and stay quiet.
🎷 Missing capabilities and transparency – in order management (still a lot of companies have a semi-manual process to confirm / track orders) the customer segmentation is not transparent and thus a one-size-fits-all (or LSFS) approach is applied.
🎷 Not applying the customer segmentation to the supply chain – what starts with customers needs to be applied in the inventory policy in the warehouse delivering, in the production sites and suppliers. This is not easy and often not supported by the IT backbone. E.g. inventory needs to be “rationed” to implement a segmented strategy towards the customer.
🎷 Averages vs importance – OTIF is measured, but aggregated wrongly – in the below case, the average OTIF is 86% (not the target, but “getting there”), if weighed by the importance we would get to lower 70% - which is not acceptable. This needs to be discussed and improved in a proper performance dialogue.
How to improve the situation? Proper E2E SCM with the right narrative (as Radu and I describe in #sourcetosold) to ensure every colleague across the value chain understands, lives, and breathes a truly segmented Supply Chain.
