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Teknisk Logistik

Lunds Tekniska Högskola

Process-based business development

Using the Process concept, methods and tools to improve adaptivity in supply chains

Project leader: Everth Larsson everth.larsson@tlog.lth.se

Supply Chains – or rather “Demand Networks” – are becoming more and more complex. There are different reasons for this, like increasing globalization, heightened uncertainty, increasing product complexity and ever-increasing customer demands for higher service at lower costs (ELA & A T Kearney, 2004, Differentiation for Performance Excellence in Logistics, Deutscher Verkehrs-Verlag). Other reasons include outsourcing, a higher part purchased components, and focus on leanness in all links in a chain.

The report mentioned also says a o: ”Leading-edge supply chains employ a new set of capabilities to proactively manage complexity, drive performance, and improve competitiveness. They exploit a set of three distinct levers and apply them appropriately”. The three levers described are collaboration, value chain management, and differentiation.

Problems and solutions corresponding to the ones for the supply chains (which according to most definitions include at least three companies) described above are also found and successfully treated when working with single companies. A very useful concept to use then – including specific methods and tools – is Process orientation. A useable definition of this concept is:

Process orientation is the effort aiming at changing the – of the function-oriented paradigm characterized – view on organisational form, systems and structures as well as attitudes, set of values and organisational culture, and place these factors in a ‘process context’. Process orientation is to adapt the business to a new paradigm. The processes will be the natural point of departure for how a business is seen, designed, managed, operated and developed”. (Ljungberg, A & Larsson, E, 2001, Processbaserad verksamhetsutveckling, Studentlitteratur)

Process orientation has so far a o been a way to eliminate the “functional silos” characterizing a hierarchical function-oriented organisation. In a supply chain the “functional-silo”-problems tend to be still worse. Apart from an essentially higher level of complexity, issues like legal borders, members of the supply chain are also working for competitors to the focal company, questions about process ownership over company borders, authorities and responsibilities are included in the problem area.

The overall purpose of the project is to explore and analyze possibilities, benefits, driving forces and barriers for increasing adaptability in supply chains by the use of concepts, methods and tools from process based business development.

The overall research question can be formulated: How can process orientation contribute to improved adaptivity, effectiveness, efficiency, and integration of supply chains?

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