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A Business Model for Programme Managing the Supply Chain Portfolio

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By Prof Pieter Steyn 

Johannesburg & Western Cape, South Africa ________________________________________________________________________

Introduction

Effective and efficient management of the Supply Chain Portfolio is widely regarded as the key to optimal organisational performance.  How to achieve this has remained a complex challenge to executives and senior management of organisations in the private and public sectors.  Programme management has moved beyond its initial application of managing cross-functional portfolios of projects. Organisations that follow a project driven business model do projects for external customers on the basis of successful tenders (bids). They have been structuring their project management processes into cross-functional matrixes for many decades. Stated differently, they have since the 1970s been arranging their project driven business model supply chain processes into cross-functional matrixes to optimise organisational performance. This was the beginning of the demise of bureaucratic structures and paradigms that eventually led to the modern day knowledge-based learning approach of leading and managing the organisation.

Stock and Lambert (2001) describe Supply Chain management as a highly interactive, complex systems approach that requires simultaneous consideration of many trade-offs.  Supply Chain management integrates key cross-functional business processes from suppliers to end users and provides products, services and information that add value for customers and other stakeholders. They identify the structural dimensions of the Supply Chain Portfolio as the participating members, the cross-functional processes of the Supply Chain, and the different types of process links across the Supply Chain. They correctly identify executive support, leadership excellence, commitment to change, and empowerment as key requirements for successful Supply Chain management, and regard information as a key enabler of Supply Chain Portfolio integration. They assert that, due to the dynamic nature of modern organisations, leadership and management should regularly monitor and evaluate the performance of the Supply Chain.  They regard it as imperative that performance goals are met, and failing so, Supply Chain alternatives are evaluated and change implemented. However, they do not propose a synergetic structural model for managing the abovementioned.

Steyn (2003, 2010 and 2012) avers that the abovementioned is virtually impossible to achieve in bureaucratic organisations and the challenge is for organisations to transform to learning organisation paradigms and structures. Garvin (1993) provides the following definition of a learning organisation: “A learning organisation is an organisation skilled at creating, acquiring and transferring knowledge and at modifying its behaviour to reflect new knowledge and insights”.  He asserts that to stay competitive in the new economy, organisations must strive to move away from bureaucratic practices towards becoming learning organisations that are far more agile and flexible. Steyn (2001, 2003, and 2010) proposes that organisations shape all their cross-functional portfolios into various programme structures, some processes serving internal customers and others external customers.

In addition to the project related programme structures of the Strategic Transformation Portfolio, Continuous Improvement Portfolio, Capital Expenditure Portfolio, and Virtual Network of Partners Portfolio, they should also shape the Supply Chain Portfolio’s cross-functional processes into a programme management structure, or structures depending on the business model adopted. Moreover, a management structure consisting of project-, process-, programme-, and portfolio managers must be created to bring synergy, including a Chief Portfolio Officer (CPO) as part of the executive.

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About the Author 

dr. pieter steynflag-south-africaProf. Dr. Pieter Steyn

Founder, Head Director, Principal, Professor

CranefieldCollege of Project and Programme Management 

Johannesburg&Western Cape, South Africa

Dr. Pieter Steyn is Founder and Principal of Cranefield College of Project and Programme Management, a South African Council on Higher Education / Dept of Education accredited and registered Private Higher Education Institution offering an Advanced Diploma, Postgraduate Diploma and Master’s Degree in project and programme-based leadership and management. Professor Steyn holds an engineering degree (BSc Eng), MBA and Doctorate in business management and is a registered Professional Engineer. Dr. Steyn founded consulting engineering firm Steyn & Van Rensburg (SVR) in 1970. (Projects included First National Bank Head Office (BankCity), Standard Bank Head Office, Mandela Square (all in Johannesburg), Game City and The Wheel Shopping Centres (Durban)). He was appointed professor in the Department of Management, University of South Africa (1976), was Founder Chairperson (1977) of the Production Management Institute of South Africa, and helped pioneer Project Management as a university subject at the post-graduate level in 1979 at the University of South Africa.

Pieter was professor of Project and Operations Management at the TUKS Graduate School of Management, University of Pretoria from 1990 until retiring in 1998. Pieter was Chairperson of the Commission of Enquiry into the Swaziland Civil Service in 1993; Project Leader of the Strategic Management Team for the Gauteng Government’s Welfare Department and Corporate Core, 1994 to 1996. He founded the Cranefield College of Project and Programme Management in 1998. Pieter is co-author of the “International Handbook of Production and Operations Management,” (Cassell, London, 1989, ed. Ray Wild) and author of many articles and papers on leadership and management.

Pieter is a founder Fellow of the Production Management Institute of South Africa, and a member of the Association of Business Leadership, Industrial Engineering Institute, Engineering Association of South Africa and Project Management South Africa (PMSA). He is founder and past President of the Association of Project Management, South Africa (APMSA) and South Africa’s former representative on the Council of Delegates of the International Project Management Association (IPMA), 2000-2005. He is currently a member of IPMA’s Research Management Board (since 2007).   Pieter is also Director of the De Doornkraal Wine Estate in Riversdale, Western Cape.  Prof Steyn can be contacted at  [email protected].  For information about Cranefield College, visit ww.cranefield.ac.za.