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Inventory Optimization – What’s In It For Me?

April 5 spkhadmin

If you have ever read a book on selling or marketing, you will know that one of the key tenants of those disciplines is to describe the major benefits for the buyer.  From the buyer’s perspective this is literally translated into ‘what’s in it for me?’.  Similarly, ask any consultant involved in ‘change management’ about the requirements for generating lasting change and they will say something similar.  That is, that you must answer the ‘what’s in it for me?’ if you want to get ‘buy-in’ from the people impacted by the change.

Recently, when discussing a spare parts inventory optimization project with a company, a senior manager asked me to describe ‘what’s in it’ for the maintenance/reliability people.  He was adamant that this is critical if we are to get their ‘buy-in’ and co-operation.  Now stop for a minute and consider what is wrong with that statement.

Here’s what: the concept of getting ‘buy-in’ has become almost like having to gain permission from everyone before we make any changes or even talk about what to change.  This is crazy.  By its nature some change will upset some people and they will not ‘buy-in’ to it no matter what you say or do.  And anyway, since when did we need to get ‘buy-in’ on every single company policy?

Did we seek ‘buy-in’ when we said that personnel protective equipment is mandatory?  Did we seek buy-in when we established housekeeping standards?  Did we seek ‘buy-in’ when we rolled out the new company-wide ERP?  Did we seek ‘buy-in’ when we determined the new work flow for procurement?  Did we seek ‘buy-in’ when we reviewed the procurement authority limits?  In my experience the answer to all of the above is a resounding ‘no’.  (How many other areas can you think of where we don’t seek ‘buy-in’ before we make the change?)

Yes, we involve people in the process of development.  Yes, we train them in the use of the tools.  Yes, we explain what we were trying to achieve and why it is important to the company.  Yes, we support them through the initial stages where it is all a bit new and foreign to them.  But, again in my experience, we have never made adherence to company policy discretionary and it was never dependent upon the 100% approval of everyone involved.

I know that this is contrary to what all the ‘change managers’ will say but I think that the idea of ‘buy-in’ is taken too far these days.  Since when was it OK to spend money on purchases that are unjustified, to all intents and purposes un-scrutinized, with no real accountability and no KPIs, and with no defined or auditable decision making process?  It’s not, and never has been.  Yet, in my experience, this is what the vast majority of companies do.  Their approach allows them to buy stuff they don’t really need or in quantities that are excessive, and then leave it all to degrade or rust.  A few years later they throw it all away.  Sometimes this involves millions of dollars, spent on the basis of a ‘what if’ that no-one ever tested.

To my mind, establishing appropriate inventory management policy and process is not a matter of getting ‘buy-in’, it’s your job!
 
 

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Filed Under: Inventory Optimization

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