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How to Approach Change Management in Supply Chain Planning Tools and Technologies

Volatile demand, supply and transportation constraints, labor shortages, inflation pressure, and rising transportation costs have disrupted the supply chain over the last few years. These examples of uncertainty in the supply chain have persuaded many businesses to embrace new technologies to meet new disruptions. Advanced supply chain technology, including end-to-end supply chain visibility, robust reporting, segmentation, predictive analytics, and casual forecasting capabilities, allows global supply chain leaders to focus on supporting the needs of the current landscape. The technology is there – but why are companies still struggling? The answer is: the lack of focus on the people. In addressing the human element of this process, supply chain planning change management is the solution.

So, how can supply chain leaders support and promote the change? Moreover, how will users embrace and trust the changes with advanced planning tools? The adoption of new technology relies on the ability to lead change through attentive change management initiatives. The focus must be on the people that the advanced technology is impacting. 

Focus on How People will Respond to the Change 

In many instances, companies focus on the functionality of advanced planning technologies. Best-in-class businesses are also focused on system integration and data readiness, however; they spend less time reflecting on how their people will respond to the change. Focusing on people early and often is equally as crucial as technology integration and data readiness.  

Organizations should not rely solely on how advanced planning technologies can increase their return on investment and generate greater supply chain efficiency; rather, individual users need to understand why the change is occurring, how the technology impacts their role in the company, and how the organization will prepare and support this change to decrease resistance. A successful Change Management Program focuses on the early and continual process of identifying and addressing risks, change impacts, and business readiness to develop an executable action plan to assist with overcoming these barriers.  

Bridge the Gap Between Awareness and Acceptance 

Traditional systems implementations focus on the transactional cause-and-effect of data exchange with no time displacement. Most companies have been part of an ERP implementation, which is largely a transactional system, in which a user can easily spot a “cause-effect” relation in their interaction with the new technology. Advanced supply chain planning tools require forecasting and the allocation of demand into the future; the outcome of these predictions occurs over time. This increase in complexity requires change management activities to focus on bridging the gap between awareness and acceptance to increase adoption and ownership.   

Decrease Reliance on the Safety Blanket 

Relying on the data generated from old planning tools to validate a new tool’s output undermines trust in the new system and diminishes its efficacy. By running legacy supply chain tools in parallel, businesses create a misleading fallacy that the users can revert to the old system if it doesn’t meet their expectations. The advanced supply chain tool may yield results that are inconsistent with the legacy tool.  

Getting the users comfortable with the math behind the new results impacting the algorithm necessitates a robust change management focus on user acceptance. Early engagement with the tool allows users to adapt to new tasks, and as they develop their capabilities, they can fully support and accept the change.  

Engage Executive Leadership to Advocate the Change  

Legacy planning tools require planners to manage every item, so they are accustomed to preserving their locus of control and deep knowledge of their items. Planners will no longer need to put out fires to resolve inventory disruptions. With advanced supply chain planning tools, the transformation of work is more focused on automation, allowing the user to leverage their business intelligence to focus on activities, including exceptions, new product launches, and the entry of new markets.  

Supply chain change management leaders must acknowledge a shift in the hero complex for users through the evolution of their role. Visible leadership advocacy is critical. The ownership of the new tool relies heavily on the business to advocate the change and convey the business benefits to individual users by aligning with the overall change management strategy.  

Owning and Sustaining the Change 

Advanced supply chain planning tools require consistent and dedicated fine-tuning as users begin planning in the system. The shift in the planner’s role to resolve issues is now focused on the user trusting the system to make the best possible recommendation and investigating what data points drove these new results. The less the planner relies on the system intelligence, the less effective the system becomes for the user, which can result in the abandonment of the new tool. 

Successful change management strategies focus on ensuring that users are not only aware and prepared for the change but that the user has the new skills to adopt and sustain the change. Concerted communication efforts build awareness, engagement, and commitment by distributing the appropriate information in a timely manner through an effective communications plan.  

Supply Chain Planning Change Management

Moreover, an effective training strategy provides users with ample training opportunities to apply their newly acquired knowledge and skills to create self-sufficient users. Sustainment activities, including post-training assessments and knowledge transfer, enable the business to sustain training post-go-live as they shift from project training to onboarding and refresher training. Collectively, supply chain planning change management is a critical enabler of successful supply chain transformations. A structured organizational change management approach can assist businesses in navigating change and accelerating user adoption in a digital supply chain.    

Learn more about Clarkston’s supply chain planning consulting services.

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Tags: Supply Chain Planning & Execution, Change Management, Procurement, Strategic Sourcing