Tim Cook and the rise of the Chief Supply Chain Officer ?

In a recent WMS Software Advice blog post "Consumer-Driven Technology Creates the Need for a C-Level Supplychain Focus", Michael Koploy argues that the raising importance of supply chain management merits the creation of a C-level position with Supply Chain responsibility, as supply chain management can make or brake a company in today's globalized interconnected economy. He took the example of how Tim Cook, with a background in manufacturing and supply chain management rose through the ranks at IBM, Compaq and Apple to become CEO of the worlds most valuable company. Michael wrote me a mail to ask if I could share my thoughts on his article.

Take Dell as an example. Dell was an innovative supply chain champion with its BTO and JIT on opposite sides of the logistics chain back in the nineties. It rose to fame, dominating the PC industry, and turning the technology into a commodity. This happened around the time Apple was flirting with bankruptcy, when Tim Cook left Compaq to join Apple, shortly after Steve Jobs returned to the company he co-founded.

Ten years later, Dell almost became a victim of its own efficiencies and ensuing commodity drive. The company is currently in a transformation drive away from supply chain driven BTO towards a business model where it can bring value-add to its enterprise customers and pump up its margins; hereby offsetting sliding ASP's for PC's and Notebooks. In the last two years, Dell is busy transforming its BTO model to a Channel driven Go-To-Market; and focused its investments into building an Enterprise Services Business (acquiring Perot Systems) while buying Enterprise ICT Infrastructure Equipment manufacturers.

Supply chain matters; but so does talent, vision, strategy, planning, implementation, innovation, IT integration, finance, product development, marketing, and so on..... The success of Apple comes from the reinforcing and interlocking elements of its strategic value chain: product design, quality, marketing, branding, vision and innovation. Cook applied as COO his operational genius into this mix, whereby all those elements came to reinforce one another through an astonishing low amount of SKU's, resulting in procurement simplicity and leverage, outsourcing manufacturing, and so on.... At Apple Jobs had a vision which he managed to translate in a coherent strategy, which Cook then implemented from an operational perspective.

Two months ago I interviewed a former C-level executive who together with Tim reported into Michael Capellas, then CEO of Compaq. She would describe Cook as "brilliant". No doubt the man is hugely talented: there is no doubt Jobs would judge him in similar terms. Apple employees who work with Cook also attest to his genuis. The question is if the ascent of Tim Cook as executive gives the supply chain executive the right to claim C-level etiquette ?

To me this does not make the case for the "Chief Supply Chain Officer". It does make the case to engage the talent in a corporation in such manner it creates the highest asset leverage. Apple got where it is today because of superior business strategy that relied on relentless innovation, quality and execution. Dell tanked with a superior supply chain because its overall business strategy left out the innovation, branding, marketing, R&D and elements of a healthy GTM pyramid; all which became visible when others catched up and replicated Dell's efficiencies.  A company focusing on one element of the strategic value chain will struggle to become and remain relevant; just as a chair with one leg won't stand long.