Supply Chain Centers
of Excellence Drive
Better Business Results
BY JEAN V. MURPHY
Across industries, centers of excellence pinpoint and develop the technologies and best practices that
companies need to do what they do better.
enter of excellence” is a
concept gaining traction
across businesses. A quick
survey of companies in
any industry will turn up
centers of excellence in such areas at IT,
finance, human resources, manufacturing,
business process, procurement, and, yes,
supply chain. Though these centers may go
by different names, they basically are hubs
for focusing skills and resources on a specific functional area. The general purpose is
to identify, develop and disseminate technologies and best practices that make the
business work better.
At Procter & Gamble, the equivalent of a
center of excellence is a horizontal process
network or HPN, says Jake Barr, director of
supply network operations at the Cincin-nati-based consumer goods giant.
When the HPN concept for the supply
chain and other areas was launched in the
“C “C
mid-1990s, the core mission was “to provide
answers to that perplexing everyday question—how to deliver better business results,”
says Barr. “That is what drives our effort. We
want to raise the competency level of how
we execute the work, day in and day out.”
At P&G, this translates into developing
“machine equivalent” ways of managing
work, based on processes that deliver “
reliable, predictable, repeatable performance,
no matter who is doing the work or where
in the world it is being done,” says Barr.
“The way we do that is by managing on
three fronts,” he explains. The first is “
ensuring there is sufficient mastery to do the
work.” This goes beyond training because it
includes a means of validating that the necessary knowledge has been acquired and
can be applied, he says.
The second front is a governance
process. “We can’t have a thousand ways to
do work; we need one common backbone,
not just for systems, but a standardized
approach for how we think about steps and
the sequence of steps to achieve a desired
outcome. That’s how you make it repeatable and predictable,” he says.
The third component incorporates innovation. “You always have to have an eye
toward how you might redesign, retool or
renew that work,” says Barr. “A certain baseline of skills might be sufficient now to do the
work, but in 12 months we might have twice
the business pressure and will need to complete in four steps a process that now takes
eight— and do it with half as many people.
So mastery, governance and innovation—
those are the three things that we apply as a
standard approach, whatever work component we may be talking about.”
To measure whether the processes in
each of these steps is working, HSNs rely on
process control methods. “On the mastery
front, we measure to see who has the com-
