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Value Chain Management and The Big 3


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I have found that when it comes to Value Chain Management excellence, there are a number of industry-standards which form a strong foundation. This is especially true for highly regulated industries. I call these standards, "the Big 3". They are as follows:

1.) Requirements Management / Engineering

2.) Business Process Management (BPM)

3.) Product Life-cycle Management (PLM)

The Big 3 combine to form highly-structured management systems, practice methodologies and open standards which allow not only the gamut of enterprise functions to work more effectively within the four walls of the enterprise, but also to strengthen all facets of design chain and supply chain activities, functions, roles, etc. Let me give you a quick overview of each of these.

Requirements Engineering / Management is a practice which started in the defense industry with the acquisition of highly complex weapon systems as well as in the systems engineering arena where highly complex systems like NASA's Space Shuttle, nuclear reactors and so on where so highly complex and had so many potential areas for failure, that engineers needed a way to validate the end-system with the original specification. This is where the practice of managing "atomic" requirements, came into play. An atomic requirement is a statement of a need that can't be decomposed any further. For instance, if we are talking about a Cannabis greenhouse control system, we can break down the overall management of the greenhouse system into requirement categories and each category will be populated with atomic requirements. I have helped many firms to install requirements management Methods, Tools and Training (MTT) and I am always astounded when we look at the resulting shareholder value which was created by these management system programs! The bottom line is the Requirements Engineering is mission-critical for the Cannabis and Hemp value chain organization because it gives management the ability to quickly get their arms around the most complex of systems, while at the same time, building a platform for rapid business growth. All companies which want to achieve excellence in their market need to get serious about requirements management.

Once a company has installed the requisite Requirements Management / Engineering MTT (i.e. their "management system") they can then move to connect up any Business Process Management (BPM) programs that they may have in place... OR kick-off a new management system for BPM.  One last note re: Requirements Management... Once a company has successfully installed Requirements Management MTT, they will be able to address Business Rule Management (BRM), but that's a topic of automation for a future BLOG post.

Business Process Management (BPM) is where many companies have huge opportunities for growth. The process initially starts with what is called "enterprise mapping" which is a method of business modeling which focuses on business functions, NOT departments! I helped to introduce this methodology at a number of companies which I have worked for and the best known are Boeing Aerospace and PricewaterhouseCoopers (PwC). After the functional modeling work has been completed, the company will then move right into process modeling and the selection of a process modeling MTT. I championed a hybrid process management MTT while at PwC which integrates functional modeling with process flow diagramming. Once the modeling tasks are complete, then a company will be able to simulate their process flow cycle times and conduct detailed "what-iffing".

Once a company has installed these Process Management MTTs they can then move to a requirements definition phase for automating any business process which generates the highlest level of Strategic Shareholder Value. The process management team will produce a list of high-priority business process flows that they would like to automate. Before they begin to do so, they will first need to produce another requirements spec for a Business Process Management (BPM) system which will allow them to deploy automated workflows.

Product Lifecycle Management (PLM) is an enterprise-wide process flow that fully spans all areas of the enterprise associated with products and services and this includes the Design Chain and Supply Chain fuctions which extend beyond the "4 walls of the enterprise" because it links other corporate partners. The core idea behind PLM is that any product moving through the enterprise has a lifecycle "state" associated with it such as "conceptual", "as designed", "as approved", "as manufactured", "retired", "cancelled", etc. All areas of the enterprise can find the latest and greatest files, drawings, and metadata associated with a product. PLM requiree both strong Requirements Management AND Process Management to allow a firm to reap the strategic shareholder value that the corporate investments had in mind to begin with. The returns on investment can be significant.

The Big 3 are where Cannabis + Hemp Value Chain organizations need to dig in if they are serious about "burying the competition" and these 3 management systems have the power to form a cohesive and complementary super-system. A super-system which offers the company a sustainable competitve advantage!

 

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