Is Santa Good At His Job?

Customer satisfaction? Check. Optimized supply chain? Hmm

Supply Chain Santa
Supply Chain Santa. Getty Images

The holidays exist for three reasons, as far as I can tell.  (Outside, of course, those religious and ritualistic red days on the calendar.) 

1) Quality time spent with extended family.

2) The asphyxiating stress associated with said quality time.

3) The ubiquitous “Santa Claus has a really awesome supply chain” articles that we supply chain geeks throw onto the web like Christmas tree tinsel.

The thing is – during those visits with extended family, I tend to disappear to quiet, dark corners and find myself with lots of time to let my mind wander.

  And during one of those dark moments, it struck me – Santa’s supply chain is way, way sub-optimized.

I know that this runs counter to the “Santa Claus has a really awesome supply chain” article phenomenon we supply chain folks tend to propagate.  The authors of those flattering articles tend to cite Santa’s ability to deliver on-time, with pinpoint accuracy, and with a very high customer satisfaction rate.  But that’s analog thinking and we live in a digital world. 

Optimized supply chain is a supply chain that gets its customers what they want, when those customers want it – and spends as little money as possible getting that done. 

Is that Santa’s supply chain?

It is not. 

If I told you that one of your company’s key suppliers insisted that you place orders via snail mail, and it sourced all of its products from a single facility and it only delivered to you once per year – how long would you keep using that supplier?

Exactly.

Sub-optimized supply chain, Santa. 

But what can Santa do about it?  Can we help Santa actually be good at his job?  Yes. 

We’re here to help. 

First of all, Santa, no one places their orders via snail mail any longer. 

Santa needs to invest in a customer portal that allows his customers to place their orders online.

  The notion of writing letters or drawing pictures to alert Santa of his customer demands – while romantic and Norman Rockwell-esque – is wholly inefficient.  Instead of a letter covered in No. 2 pencil scratching and backward E’s that explains that one of his 5-year-old customers is jonesing for a Mutant Teenage Turtle action figure or a crayon drawing of a bicycle, imagine how effective Santa’s demand planning team would be if customer orders were downloaded directly into their manufacturing planning system throughout the year – not just seasonally.

Santa’s demand planning team could run a simple scheduling interface to optimize his manufacturing resource planning – from raw material purchases to shop floor job orders. 

Come on, Santa – Toyota was doing this in the 1940’s!

That’s right – Santa needs to go paperless and get with ePortals and integrated resource planning systems.  Letters are so very 20th Century.  Or even 19th Century. 

Next up, Santa needs to take a serious look at sourcing. 

I mean, who uses a single manufacturing location these days?  On the fifth day of Christmas, my true love gave to me – Risk Mitigation!  Yes, Santa, while you might be extremely loyal to the elves who hammer out your toy trucks and iPads – the risk in being single-sourced is not worth any of the benefits.

 

When your supply chain relies on a single manufacturing location, you leave yourself vulnerable to natural disasters (just how many blizzards can you expect Rudolph to pull you through?), strikes, un-forecasted demand spikes or even a cyber-attack.  Launch an RFQ to identify suppliers with the ability to provide you with the products you need on a year round basis. 

And, finally, Santa – you only deliver to your customers once a year.  Seriously.  Have you checked the competitive landscape?  Retailers are learning that delivering their customers next day might be 24 hours too late.  By implementing a more robust customer ordering system and expanding your supplier base, you’ll be able to deliver your customer orders throughout the year. 

Of course, those reindeer aren’t going to be able to keep up with 365 day per year delivery – but don’t worry, there are other unmanned flying objects capable of replacing them.

  Order a drone from Amazon and you’ll see the future of optimized supply chain.