Best Practices or Better Practices?

It’s a new year. Most of us will have new budgets to meet and new expectations for the performance of our supply chains. Many will look to best practices from industry leaders to improve our operations. But, are best practices really the way to go?

That’s a question posed by John Caltagirone, a former supply chain executive in his own right and now the executive director of the Supply and Value Chain Center at Loyola University Chicago. “Best practices always sounded to me like once you did them, there was no more room for improvement,” John told me in his office one day last summer. “I always thought we should adopt better practices, those that lead to continuous improvement.”

Caltagirone and Allison Ryder, the research assistant for the Supply Value Chain Center, wrote the column that follows for the upcoming issue of Supply Chain Management Review. I thought it provides food for thought for those of us in the materials handling world as we wind things down for the year.

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In the blink of an eye, today’s technology, established processes, and commonly-held beliefs become as outdated as an Iomega Zip drive. With that, even faster solutions are needed to mitigate constantly evolving problems. In this fast-paced economic environment, sticking with the status quo is not an option. In order to stay one step ahead of competitors in the specialized field of Supply Chain Management and Value Chain creation, it is essential to keep an open mind to the diversity of resources available.

Over fifteen years ago, when we first heard the term “best practice,” we questioned it by asking, has the organization reached its peak because it is a so called best practice. At that time, we started using the term better practices. A number of years later, MIT stated that best practices do not exist in supply chain; they are all situational specific.

Articles with the phrase “best in class” are becoming increasingly contrived. Likewise, the internet is bloated with articles and newsletters reporting the new ‘world class’ or ‘best’ solutions to solving critical problems. So called acclaimed sources consider their material to be “revolutionary” and the “best” out there. Certainly, there is no “best” solution in regards to the discipline of Supply Chain Management or Value Chain creation. ‘Best practices’ imply that its once and done; better practices imply that we’re constantly improving. It is important to note that what is good for one company is not necessarily good for every company.

Because of this, we like to take a holistic perspective. By replacing “best” with “better” we are leaving room for future changes and flexibility. With ‘better’ practices, solutions are adaptable from company to company, and we all win.

What makes a practice “better” and who should care? Let’s look at a few examples.

Process Improvement is a key term commonly associated with “best” practices. Receiving or transporting goods via a third party logistics provider may often be the “best” solution to a problem. However, do these best practices identify the challenges and downsides as well? These “best” practices are not applicable to everyone. Essentially, outsourced Process Improvement, among others is not a one size fits all practice.

Another example of this is the implementation of new technology. With a fast-changing environment, there are new technological advances every day. This new technology is transforming the world of supply chain. While many organizations’ supply chains rely heavily on technology, several are doing just fine without it. Integrating state of the art technology seems to be the first recommended solution, when, oftentimes, there are quicker and less costly options.

Identifying “better” practices provides continuous improvement to the supply chain of an organization. What was a “best” practice five years ago could now be outdated and irrelevant in the industry. Moreover, this is why it is crucial for companies to stay relevant by avoiding the status quo and seeking new solutions as soon as issues arise. Today’s best practices may not be the answer for tomorrow’s problems, and as professionals in the supply chain industry, we are prepared to provide “better” and more sustainable solutions.

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As you think about 2016, I hope you ask what better practices you can adopt for your supply chain? As always, I look forward to hearing from you with any comments or suggestions for future stories in MMH at [email protected].