Tactical Planning

Becoming Adaptative To Survive!


As of the writing of this article, South Korea had 8,200 cases of Covid-19 detected and 76 deaths equivalent to 0.92%;

Italy, on the other hand, had 24,800 cases detected, 1,820 deaths equivalent to 7.54%

Why this so much different? some will say that it is because of the average age in Italy, which is much higher than in South Korea, which is not valid: in Italy, the average age is 45 years old, in South Korea, it is 42 years old…

The reality is that Koreans were prepared. After facing MERS (Middle East Respiratory Syndrome) in 2015, they learned from their experience. They designed an ADAPTIVE SYSTEM that allowed them to detect, interpret, and execute actions to mitigate a virus’s spread efficiently. The government also approved exceptional measures such as tracking possible carriers by monitoring cell phones and their applications and locating them through geo-positioning. The government evaluated symptoms through an app.

“This includes enforcing a law that gives the government broad authority to access data: CCTV images, GPS tracking data from phones and cars, credit card transactions, immigration entry information, and other personal details of confirmed people, who have an infectious disease.

The authorities can make part of that information public so that anyone exposed can test themselves, their friends, or family. “

Koreans today are capable of examining 10,000 people a day (Other sources speak of 20,000).

In summary, the Koreans designed a system that allows them to react very quickly, adapt to environmental conditions, are coherent in their decision making, being very clear about the objectives they pursue, make sacrifices to succeed, and are highly resilient. Something fundamental is that the dissemination of information is done with excellent transparency and clarity.

Koreans do not allow the media to create unnecessary stress or worry because they know that this can work against their goals.

If we compared the way the Koreans and Italians handled the Covid-19 problem, we would find significant differences and different results.

Suppose we made an analogy, respectful and keeping the proper proportions, regarding the situations that companies regularly face, managers could highlight several aspects: Successful companies, as well as South Korea, can census the market and the environment where they move and quickly execute reconfiguration actions on your processes, your systems, and even your culture.

“THE COMPANY’S CULTURE is something planned and built according to the strategic objectives to desired.”

Successful companies are continually updating and innovating in their business model as the world evolves.

Successful companies do not allow problems to metastasize, affecting many areas. They have agile and efficient “damage control.”

Successful companies exercise and promote an adequate communications system, which acts as an internal and external comptroller. External suppliers, clients, and stakeholders are heard through their complaints, claims, observations, and requests. Similarly, the internal communications system serves to communicate and effectively connect the strategy with the execution and, on the contrary.

All of the above is nothing more than what Deming proposed 50 years ago with his PHVA (Plan, Do, Verify and Act): an endless cycle of ideation, testing, error, learning, that is: Evolution.

However, although the key to “business evolution” has been clear for a long time, the reality is as Carol Ptak says, in her book, The Demand Driven Adaptive Enterprise: “Although we can perceive corporations as lasting institutions, now they die, on average, at a younger age than their employees.”

A large number of companies’ problem is that they do not know an effective way to connect strategic objectives with actions in operation and carry out an adequate follow-up that allows reacting and reconfiguring systems and processes.

The big question would be: how to solve the problem described above?

Demand Driven Institute® proposes an exciting integration of strategy with operation in his book The Demand Driven Adaptive Enterprise: Demand Driven Adaptive Enterprise® (DDAE)

DDAE® is an ADAPTIVE model to manage the company that promotes and encourages the flow of information and materials in the chain; It is not an additional process that runs parallel to the company’s administration, and this is essential …

This working model proposes three threads connected:

  1. Adaptive S&OP (AS & OP®) that works in the relevant strategic range (from an accumulated lead time onwards)
  2. Demand Driven S&OP (DDS & OP®) that works in the relevant tactical range (between an accumulated lead time in the past to one in the future)
  3. Demand Driven Operations Management (DDOM®) working in the relevant operational range (a decoupled lead time in the future)

The connections between the three previous processes are two-way: Feedback from the operation to the strategy (how the operational model is performing) and Reconfigurations (from the operational model) from the strategy to the operation.

Each relevant range (strategic – AS & OP®), tactical – DDS & OP® and operational – DDOM®) has defined indicators, parameters, and analyzes, these being the consistent promotion of the flow of materials and information

The model is governed by several principles, among others:

  1. Assets synchronized with demand.
  2. The supply chain must have variability mitigation devices.
  3. Perfect synchronization of assets and materials is a wasted effort.
  4. We are in an MTS world; having inventory is imperative. The important thing is where and how much.
  5. Companies should define lot sizes based on flow promotion, not based on minimizing costs.
  6. Protective capacity is vital for arranged and maintained in the restricted resources as an alternative mitigating variability. Perfect resource balancing is the worst thing you can do to promote flow.
  7. Inventory is an asset, not a liability.
  8. Factories must establish capacity according to the expected future of the company.

Now, to take full advantage of this methodology and generate the most significant benefits for the company, it is crucial to take into account these requirements, among others mentioned in the book The Demand Driven Adaptive Enterprise, written by Carol Ptak:

  1. There is a defined strategic direction in the company.
  2. That the organization understands the difference between managing the flow and managing the cost and aims to promote the first.
  3. The organization must have at least a flow-based operating model (DDOM).
  4. The organization must have the capacity and personnel to carry out a tactical reconciliation activity, with the flow-based operational model (defined DDS and OP activities).

In conclusion, I find in this model an exciting proposal for aggregate administration (carried out by senior management) with detailed administration (carried out by the people in charge of execution). This proposal very clearly delves into how to connect Strategy with Operation, an aspect that still, in my opinion, it has not been well “landed” by other authors.

DDAE incorporates many aspects of as IBP, S&OP, TOC, and LEAN, among others, which together become a very robust model, especially at the operational level with its DDOM (Demand Driven Operations Management), which ensures impeccable execution. That allows us to obtain tangible results in a short time.

Ptak, Carol. The Demand Driven Adaptive Enterprise . Industrial Press, Inc.. Edição do Kindle.

Palmatier, George E.. The Transition from Sales and Operations Planning to Integrated Business Planning . Dog Ear Publishing, LLC. Edição do Kindle. https://alcanzandoelconocimiento.com/italia-y-corea-del-sur-dos-formas-de-enfrentar-la-pandemia-de-coronavirus/