SUPPLY CHAIN SERVICE STRATEGY

E d w a r d H . F r a z e l l e , P h . D .

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RightChain™ It’s OK to say no! During one of our supply chain strategy seminars I made the statement, “The customer is not always right or king.” One of the seminar attendees took quick and loud offense. She blurted out, “The customer is always right and king in our organization.” I asked her who she worked with. She said that she was the chief supply chain officer for a large utility company. I asked her how they responded when customers failed to pay their utility bill. She said, “That’s simple. We just cut their power off.” I asked her if that is how they treated kings? She said, “No, that’s how we treat repeat offenders.” I said, “So not every customer is a king.” That’s the point. Not every customer is a king or right. One of my favorite books of all time is Boundaries , written by John Townsend. The book teaches when and how to say “yes” and “no,” how to manage expectations, and how to deal with the unreasonable expectations of others. Some customers have unreasonable expectations. If there was a book, titled Boundaries in Business , it might have a section on supply chain service policy that includes weeding out andmanaging unreasonable customers. A few years ago, I was teaching our RightServe™ methodology at 3M. Their culture is uniquely receptive to customer and SKU segmentation as well as to the discipline of supply chain service policy making and keeping. The notion of Boundaries resonated in their organization. Suddenly my book titled Supply Chain Strategy, and Boundaries were prominently and oddly linked on Amazon’s related purchases promotions.