Archive: September, 2015

Marginal gains

England’s narrow defeat against Wales in the Rugby World Cup at the weekend will lead to some sole searching in the England camp this week before the critical game against Australia on Saturday. From what we know about the Rugby Football Union the sole searching will be accompanied by a concept called the “aggregation of marginal gains.” The cumulative effect of improving every aspect of the game by a small amount results in a significant improvement in overall performance.

Marginal gains can trace its history back to Sir Clive Woodward’s world cup winning team of 2003. As Sir Clive explains in his autobiography, Winning!, every aspect of the players preparation was looked at, analysed and improved. For example, players were given laptops so that they could receive their performance data and key information about their opponents. It also helped them keep in touch with family and friends at home while they were on tour. This approach was successfully applied to cycling by Sir Dave Brailsford. Matt Parker, a physiologist, is a key figure who worked with Sir Dave at the Olympic GB cycling team and more recently with Stuart Lancaster, England Head Coach at the RFU.

Marginal gains is a relatively new concept for sport but has been used in industry, and supply chain in particular, for decades. Some of you will recognise the term, kaizen, a Japanese word meaning “change for better”. Kaizen was first implemented in several Japanese businesses, most notably, Toyota after the Second World War.  All employees, from production line staff to board members, were expected to come up with ways to remove waste and improve performance. While the majority of changes were small, the combined effect was large. Kaizen is one of Toyota’s guiding principles which helped it become the first automobile manufacturer to produce more than 10 million vehicles per year.

The rise of big data and development of spend analytic tools provide Procurement with the opportunity to facilitate a step change in their organisation’s performance. If everyone involved in the supply chain has access to relevant data and an easy method of communication then Procurement can gather their ideas, evaluate them and work with suppliers to implement them. If Procurement could manage this then it would feel like winning the Rugby world cup.