Quick Scan in Australiasia

Guest Lecture to Service Operations Research Theme (SORT), Cardiff Business School
QSAM in Australiasia
QSAM: Quick Scan Audit Methodology 

by Dr Eric Deakins from University of Waikato, New Zealand

19 October 2011

Industry fieldwork with NZ value stream

Objectives: 

• Understand barriers to seamless flow within the NZ context
• Identify SC issues

Labour productivity in NZ was quite low during 2005-2008

• Relatively low productive comparing to OECD countries, work more than the output
• Around 10%GDP of business investment , lower than OECD average

Full QSAM sample

• NZ commodity
• Large daily factory
• Large (global-brand( pulp and paper producer
• Med. 3PL

NZ non-commodity

• Med. kitchen manufacturer
• Large (global brand) food producer etc.

Results

• International integration comparison: baseline, functional integration, internal integration and external integration
• an issue is to get the client interested in improving their integration level

Case study

• Bad case:
  Cause-Effect -> no strategic plan and direction, reply solely on cost as a single KPI, reliance on tacit knowledge resulting in decline profitability
• Identify barriers to SC integration using three layer framework, from outside to inside = environment, company and value steam from (Bohme et al., 2009) and four type classification from Cardiff BPR, culture, technology, finance and organisation
• define the scale of each classification (Cardiff BPR) by low, med and high
• Output (PhD thesis) supply chain improvement path way -> change programe (attempt to improve)

Pathway of least resistance: 

• Starting from people and then integrate internally and externally simultaneously
• Key moderator for internal process – top management support
• Key moderator for external relationship integration are positive power and dependency structure
• Applying technology in the end of both internal and external integration

Reflection

1. People

• “Once we were warriors”
  – Deep down they still are
  – Male dominance
• Win-Win is for wimps
  – Competitive mind. just interact in the business and move on
• “Once were pioneers”
• “This is NZ so [obviously] our needs are unique”
• Industry and academia are like oil and water
  – Most mid and top level managers don’t have a degree, just learned from their jobs
  – Then, they are not interested in the business
  – “I learned all that I wil ever need on the job”
  – “We made 2.4 billion last year”

2. The Place

• NZ is unpopulated – “Everyone knows everyone”
• NZ living is relatively uncomplicated
• NZ is a very risk-averse society
• NZ is broke (es.. Since Christchurch earthquakes)
• NZ has poor logistics and transport infrastructure and all modes aggressively compete with each other
  – No productivity strategy, “let the market decide”
• Government is populist and prone to knee-jerk reaction
  – 3-year term; MMP system

3. A longstanding focus on effieciency

• “This plant is running at 110%”
• “We couldn’t stop the paper mill even if we wanted to; after 52 years of operation no-one would know how to restart it”
• “Every fire station, warehouse and unused cool store for 50 miles around is full of our product”
• “When we restart the furnance the lights dim in the local supermarket and the EFTPOS machines  go down.

4. The Perspective

• NZ is very remote from its markets
  – Parochial, cliquey, ‘Us and them’
• very small or far away?
• the long view – ‘3D narrow’ versus ‘2D wide’

Research avenues

How to increase QSAM impact/effectiveness/reputation?
Post-QSAM Impact (0-10)
Dairy company = 8
Pulp/paper mill = 5
3PL = 1
Kitchen manufacturer = 3
Food producer = 3
Machinery manufacturer = 7
Hospital = 1
Foundry = 0
Average = 3.5 

Improvement alternative
1. Aspirin – Quick Hit – short term not sustainable
2. Sustainable way – operational efficiency

Possibilities

• Impact of organisation culture on supply chain behaviour and on resistance to change and performance
• Monitoring the progress of value stream change from a system perspective – trajectories and scorecards
• Further development and aplication of QSAM to health and otherservice orientated value streams
• Soft system considerations