From supply chain to supply network
Early on, we made a subtle but significant shift in our overall mindset. Instead of talking about a supply chain, we began thinking in terms of a supply network. This transformed our approach from abstract complexity to more effective management, and as a first step, we captured how orders, data, and decisions flow within the company. The findings confirmed that, above all, better coordination was needed, and more than fancy new algorithms.
In fact, we also learned that complexity isn’t always a bad thing, but rather a reality that must be accepted. Our complex, adaptive supplier network system consisted of many self-organizing parts. If we tried to ignore these dependencies and force simplification, we would’ve only created new problems. One manager also warned against piling more complexity on an already convoluted environment, and instead work on strengthening existing connections between all members of the organization. So we shifted our focus and formed cross-functional working groups with representatives from all affected departments to address each key process to ensure everyone was pulling together, rather than just pulling their own.
An example of network thinking in practice was the way we eliminated discrepancies between hotel operations and the rest of the business. Initially, hotels managed guest bookings and supply requirements almost independently of each other, and were unaware of new product launches or events that could lead to a surge in demand. The lack of coordination between hotels and other departments led to some nasty surprises. For instance, on busy weekends, key offers would be out of stock because the hotel team was unaware of a promotion, a classic case of strategic misalignment. To address this, we established new communication channels and integrated planning sessions, effectively reintegrating hotels into the overarching supply network. We began treating internal departments as part of the network rather than as isolated kingdoms.
