The Future of Supply Chain…Culture

Innovators like Apple, Google, and Unilever are competing on culture, and not just price. Steven Melnyk says your company can too.

October 07, 2015

The upcoming Supply Chain Outlook Summit will feature 10 different speakers who have their fingers on the pulse of the most important changes impacting supply chain management over the next 2-3 years. At the event,Steve Melnyk, Ph.D., will discuss Culture Eats Strategy…And How to Deal with It, an especially relevant topic for supply chain leaders in today’s competitive business environment.

As the Professor of Operations and Supply Chain Management at Michigan State University, Melnyk has co-authored 17 books on operations and supply chain management. His research interests include supply chain and design, metrics/system measurement, responsive supply chains, sustainability, and strategic supply chain management. An active researcher, Melnyk is known for his ability to bridge the gap between the academic and practitioner worlds. A member of the APICS 2015 Board of Directors and a member of the APICS leadership team, Melnyk has his finger on the pulse of the modern supply chain.

In this Q&A, Melnyk will explore culture, its importance, and how it can be harnessed to support rather than frustrate strategy within the supply chain realm.

SCO: What does “culture eats strategy” mean?

Melnyk: The concept dates back to Drucker in the 1960s and means that strategy, if it doesn’t consider the role culture plays in it, is bound to fail. The culture understands how the game is played, it can wait things out, and it can transform a strategy from a top management initiative into one that’s actually acceptable by the system as a whole. There are too many examples of lean, Six Sigma companies that, in their quest to become innovative organizations, wind up generating a series of unexciting incremental innovations. They effectively put all of the resources in, but the outcomes are far from what they expected. 

SCO: Why do companies ignore this?

Melnyk:  Many of them think of culture as a negative, but it’s not. In fact, it’s one of the forces that organizations have to develop. Culture is powerful when it’s used properly, and it’s also powerful when used improperly. For many companies, culture is the missing piece. I teach at one of the leading supply chain programs in the country and this is often the only exposure companies have to that concept. And yet, it’s so critical.

SCO: Why should supply chain managers care about this?

Melnyk:  Because when used correctly, culture can ensure that your front line employees are doing what you want them to do when they interact with customers. In today’s environment, where resources are shrinking, competition is high, and lead times are shrinking, companies can’t afford to ignore this. They no longer have the slack to overlook the value of having a good culture. When you think about Apple, Google, and Unilever, these companies are focused not only on systems or information, but also on culture. It’s part of the triumvirate.

SCO: What do culture-focused companies get in return for their efforts?

Melnyk: They get an organization that’s in true harmony, better customer service and experiences, and decisions that are made by people who know and understand the overall goals of their organization. When a new problem surfaces, those individuals turn to the company’s values, norms, and beliefs and then use that knowledge to drive their actions. You don’t have to stand over them telling them what to do. When you do culture correctly, you wind up with a very powerful and positive force.