“More planning is better. More detailed scheduling is superior. Micro-management is great. Babysitting is a method. Let’s enjoy the illusion of control by adding lots of details. Let’s avoid people having to decide by themselves. We know better than them and we know that (they don’t). When we just dictate everything, everything will be fine and smooth and optimal.”
In a moment of frustration, more than ten years ago, I wrote down the above text in my notebook. When you do projects, tensions can rise, and my way of regulating that has been to note down the voice that I hear inside. So what about control? When implementing decision support systems for supply chain planning, the designers need to make a judgement, to what extent the ‘lower level’ needs to be controlled. And the project to do that also needs control. But do we need to prescribe every action, not leaving any decisions to the lower levels?
In the Western professional culture, we are obsessed by control. Managers are typically more focused by the workforce obeying certain rules and processes on how they do their job, than the actual outcome. When there are problems in execution, managers typically have two strategies: either they ignore the problem completely, or they call together a group of people to create some kind of action plan. The middle way seems culturally not accepted – suppose a manager would respond to his senior like this: “I observed a problem in execution, but I see this as some natural variation, some noise that might go away by itself. So I decided to wait and see.” Or: “The team should be able to sort this out by themselves. Let them struggle a bit.” In most companies, this would be seen as incompetence, whereas in many cases it is actually an effective strategy. When should we resist the urge to pull the strings and have decisions solved decentrally?
In supply chain planning, there can be several good reasons to decentralize decision making:
- Lower costs, as decisions that are taken locally do not need human resources with expensive systems on higher levels.
- Better resolution speed, as problems can be identified and solved quicker in execution, where they occur. When problems need to be escalated a level up, this will by definition need more time.
- Philosophy, as a company might have the vision to have decisions decentralized as much as possible, i.e. to have self-steering teams.
- Reduce resistance and increase motivation, as people in execution like to make decisions about their own work, making their job more meaningful.
However, there can also be factors that drive centralization in supply chain planning:
- Limited maneuvering space can make it not useful to decentralize, as in such cases it is not possible to make decisions on the lower level.
- Strong up- and downstream dependencies means that local decision making can lead to suboptimization as the up- and downstream effects are not seen on that level.
- Low uncertainty in execution – there is less need to decentralize decision making when execution is relatively predictable.
So what does that mean for designing Advanced Planning & Scheduling (APS) systems? Implementing APSses typically goes hand in hand with more centralized control. For example, when self-organizing teams have been implemented in execution, an APS for detailed scheduling would interfere with the team’s autonomy. However, the APS might still make sense, when it takes that into account – for example, by releasing groups of orders instead of prescribing the precise sequence, or by only prescribing the sequence on a bottleneck resource. Alternatively, the operators are given access to the APS, or to a scheduling module that is included in a Manufacturing Execution System (MES). The feedback processing needs to take into account that changes will be made to the plan or schedule.
To conclude: exercising control is something that should be situational, instead it being a matter of principle. Having centralized control does not automatically mean that things will run better. There is much potential for decision making in companies that is not empowered, nor recognized. Employees make lots of important choices and many are responsible decision makers – in their private life. Just make sure they do not drop that once they open their laptop or enter the factory.
You can read more about this topic in this book.
(the title being a homage to Anton Corbijn’s movie Control)