Who’s Kidding Who? Your Strategy Should Get You Fired

This is an excerpt of the original article. It was written for the January-February 2016 edition of Supply Chain Management Review. The full article is available to current subscribers.

January-February 2016

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 “best” way to go? As you think about 2016, I hope you ask the question: What better practices can I adopt for my supply chain?

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The average career of an NFL player is 3.3 years, according to the NFL Players Association. Given that no one is trying to sack them behind the line of scrimmage or cut them off at the knees, you’d think that CPOs could look forward to longer job tenures than a football player, but that’s just not the case. According to research from CAPS, an organization’s first CPO is likely to keep the job for 3.9 years, while the average tenure for a successor is down to just 3.2 years—a little longer than the average Millennial is likely to stick around in their first job. In contrast, the CFO likely to sack a CPO holds that spot for eight to 11 years. What accounts for the relatively short job span of CPOs? Based on our experience as academics, consultants, and former CPOs, we contend that it starts—and ends—with strategy.

Over the following pages, we’ll look at the supply management strategies we most often see at play; identify why we think they not only fail, but contribute to the short tenure of CPOs; and offer some prescriptions for addressing the issue.

It’s Not a Zero Sum Game
Maybe the issue isn’t strategy per se, but the misapplication of strategy. Without a doubt, one of the most successful business strategy frameworks is the Five Forces Model of industry profitability developed in 1979 by Harvard’s Michael E. Porter. One of the assumptions of Porter’s model was that of a static, zero sum game in which the potential profit of an industry is fixed, with players competing for their share of the pie. Nearly forty years after its publication in the Harvard Business Review, Porter’s original model continues to captivate the minds of MBAs, CEOs, and supply management practitioners.

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