How Do You Become Customer-Driven?

Andy Harding, former Chief Customer Officer at House of Frazer talks to Retail Connections about how a company can put the customer first.

Andy Harding at Retail Connections discusses being Consumer-DrivenFormerly Chief Customer Officer at House of Fraser, Andy was responsible for the retailer’s customer strategy including brand and marketing, the digital proposition and multi-channel sales, both in the UK and internationally.

He has over 15 years experience in online and multi-channel retail and was named Retail Leader of the Year 2015 at Retail Week Technology and eCommerce Awards in 2015, when House of Fraser also won Multi Channel Retailer of the Year 2015.

Source: Retail Connection

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Big Data, Big Visibility

Turning Big Data Into Big Visibility

How companies are leveraging their data to gain valuable intelligence and automate processes across their end-to-end supply chains

Download Big Visibility.

Can Technology Predict the Presidential Election?

Thanks to Big Data and Technology, the Science of Prediction is Changing

The art of making predictions is changing. It is no longer sufficient to select a random sample, conduct a poll, assess the margin of error and then make a prediction.

For today’s always connected voters, we really need to get visibility into their “micro moments” to understand evolving intent and leanings. Take a look at the dashboard below from Google that is tracking trends in online searches. While it does not tell you directly who people will vote for, it does paint a pretty clear picture of the level of interest in various candidates.

Searches for Hillary Clinton and Donald Trump (last 90 days)


The Future of Prediction?

My own hunch is that analysts will shift to looking at a many disparate indicators and triangulate evidence to converge on their predictions. For the techies out there, I am talking about a concerted shift to what are known as Bayesian approach to statistics.

“Bayesian statistics is a theory in the field of statistics in which the evidence about the true state of the world is expressed in terms of ‘degrees of belief’ called Bayesian probabilities.”
Bayesian Statistics, Wikipedia

This revival has already happened due to pervasive use machine learning in many disciplines. Perhaps the most prominent example of the power of this approach was when Bayesian statistics helped find Air France 447.

Technology like Google Trends offers powerful new insight into voter's minds, but can it predict the President? Click To Tweet

Search trends on Google can be a powerful indicator of which candidates are on people’s minds. I believe that combining this evidence with polling results, segmentation along decided and undecided voters, and predictions of likelihood to show up among other indicators can yield a much stronger prediction than polls taken alone.

So could technology like Google Trends serve as a leading indicator for how the people will actually vote in the Presidential election? Let me know what you think.

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Supply Chain's New World Order

Supply Chain's New World Order

Do you want to know what's coming in supply chain? Download Supply Chain’s New World Order.

Learn how companies are using the cloud for predictive and actionable supply chain analytics, integrated business planning and more...

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Amazon One: Amazon Takes to the Air

 

Amazon unveiled its first branded cargo plane today, and will showcase its fleet of 20 branded 767-300 planes in Seattle, WA on Friday.

Meet Amazon One

“Creating an air transportation network is expanding our capacity to ensure great delivery speeds for our Prime members for years to come,” said Dave Clark, Amazon’s senior vice president of worldwide operations. “I cannot imagine a better way to celebrate the inaugural flight than in our hometown at Seafair alongside Amazon employees and Seattle residents.”

The airplane, named Amazon One, is one of 40 that Amazon has agreed to lease through air cargo partners Atlas Air and ATSG. There are currently 11 dedicated airplanes flying for Amazon as of today with additional airplanes rolling out over time. In an ode to its Prime members, Amazon’s first airplane in its dedicated fleet features a tail number made up of a Prime number.

Read the Amazon Press Release

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Supply Chain's New World Order

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Dock Doors: Critical Valves in the Supply Chain

dock door detention tales on the trail at dusk.

Tales from the Trail: The Rough Road Through the Dock Doors

Last week a friend who’s the manager of a large store in a national retail chain and I went for an evening trail run. I was looking forward to it as I had just read DAT’s survey of truckers and their complaints, and wanted to get his perspective as a store manager. He’s the manager of top performing store in a $60B company, so I figured I’d get some insight.  I wasn’t disappointed, but it wasn’t quite what I expected.

Delays and Missed Opportunities are a Major Problem

According to a recent DAT survey

Of the carriers surveyed, 54% of them said that they wait between 3 to 5 hours every time they’re at a shipper’s dock. Another 9% said that they wait more than 5 hours on average.

Dock Doors: Critical Valves in the Supply Chain - dock door detentions can clog your supply chain.

Many shippers and receivers are lax about their dock operations, but it's the carriers and drivers who pay... Click To Tweet

From the survey results and the responses to it, it is clear that dock delays are a major problem for carriers, everyone knows about it, yet little is done to remedy the situation.

Most of the carriers said they are seldom paid for the detentions, and when they are, it does not cover their costs, particularly if they miss other load opportunities due to the delay.

“Many shippers and receivers are lax about their dock operations, but it’s the carriers and drivers who are forced to pay for that inefficiency.”
Don Thornton, senior vice president at DAT

Andy, my trail running accomplice, was not surprised at the survey findings, and admitted that drivers were frequently delayed at his store too.

“How do they react, do they get mad?” I asked. “The new drivers do, the regulars stand around and chat.”

“How do you manage the doors?”

“With pen and paper.”

Perhaps I misheard through our panting as we wove our way through the woods.

“Wait a minute, you’re a $60B company… did you say you manage your dock doors with pen and paper?”

“That’s what I said.”

He explained that some appointments are standing appointments; some are scheduled, while others are unscheduled. Even the scheduled appointments are headache. He said it can take a carrier 3-4 calls to reach the scheduler as they’re often away from their desks and sometimes out of the store.

Dock Door Delays and Driver Confusion

On busy days, congestion at the dock doors is common. The store tried to give scheduled loads priority over the unscheduled, but a wait of 2-3 hours is not unusual.

To make matters worse, some dock doors have constraints and cannot accept loads over 15 feet long due to the lack of space inside the store. New drivers don’t know this, so they often dock there then have to back out and re-dock at another door if and when that door is available.

Andy confirmed the survey’s results, dock doors were a major source of delay and loss for drivers. But he was just getting started…

Andy knew the drill, but I told him anyway, “You realize that’s a pretty easy problem to fix? A dock scheduling solution will allow you to time your deliveries, and carriers can do it themselves. They won’t need to call and play phone tag with your guys trying to get an appointment. You can set up various types of doors so the truckers know exactly when and where to dock. Plus, you’ll know what’s in the trucks ahead of time and can prioritize them on based on that if you want to, say if you’re having a promotion and are running low on an item.“

“You don’t know half of it.”

“What do you mean,” I asked.

Beyond the Dock Doors

He went on to explain the ripple effect the dock door chaos had on his job and his store.

  • No Process, No Information. “I have a guy that has to manage the doors, be available to take and return calls. And if he calls in sick, it can really throw us off and be a major problem. A lot of the info and the process are in his head.”
  • The Doors Tie Up His Resources Unnecessarily. “Since we don’t know what’s coming and when, I often have at least four people tied up at the doors, expecting deliveries that are often delayed for whatever reason. We usually have no idea where the truck is or how late it’s running. I need those people; they could be helping out on the shop floor, restocking and cleaning.”
  • Lack of Data, Lack of Insight. “Worst of all, I have no historical data. I can’t look back and review the volume of traffic and resources we’ve used in the past. This makes it really difficult to plan resources and prepare for busy seasons, holidays, and weather-related events. We have to go by memory and guesstimates, but those are pretty imprecise. For example, we know we get roughly double the daily deliveries February through May, so that’s what I plan for but we’re still off quite a bit.”

Yikes. Andy’s team has a lot of experience between them, so they do better than most “flying blind.” I couldn’t help think his day to day job resembled us crashing through the woods at night on a slippery, rocky trail, not knowing what was around the next bend.

Penny Wise, Pound Foolish

Given the critical role dock doors play in the supply chain, that they regulate the flow of goods through the supply chain, it’s astonishing that companies pay so little attention to them.

Dock doors are like valves in your supply chain, they can clog and be the source of major inefficiency. Click To Tweet

Andy admitted that their process was very inefficient and unreliable, not to mention frustrating for all involved, for the truckers, for his staff, for him as a manager, and ultimately to his customers.

The good news is that a good dock scheduling solution is probably one of the easiest and most cost-effective ways to gain shipment visibility, automatically prioritize shipments, and to ease bottlenecks and streamline the supply chain. It’s less exciting than stumbling through the dark and stepping on the occasional snake, but your customers and colleagues will thank you.

Yahoo Yard Sale: What is Verizon’s Play?

Verizon Buys Yahoo: What is Verizon'sPlan?

Verizon has acquired Yahoo. This acquisition cost Verizon $4.8 billion. This price includes Yahoo’s core business. Yahoo shareholders still have an estimated $31 billion in investments in Alibaba. In addition, there are also investments in Yahoo Japan and a small portfolio of patents remaining.

Yahoo Advances Verizon’s Strategy

Verizon hopes to extend reach to Yahoo's visitors with mobile.As I stated on June, 9 2016, Verizon acquired AOL, Inc. last year and by adding Yahoo, Verizon could move further into the digital advertising business. For Verizon, buying Yahoo would be consistent with its new mobile and video strategy. This relies on offering free content and monetizing it through advertising.

Verizon considers Yahoo to be the one way ticket to valuable ad technology. Many think that Verizon is interested in utilizing Yahoo’s live-streaming video technology in order to increase the data usage of its nearly 103 million wireless customers.

Verizon’s Aspirations

The “Verizon play” is to merge Yahoo with AOL and create the number three platform for online advertising after Google and Facebook. With the Yahoo deal, Verizon will be able to offer more robust services to Verizon customers and advertisers. This is very interesting considering Yahoo considered buying both Google and Facebook in the past.

In the end, this will bring a huge amount of content: news, sports, and finance to Yahoo’s one billion monthly visitors.

Watch This Space

It has been interesting watching this deal unfold and writing about the “Yahoo Yard Sale” over the last several months. As I have stated, “a deal is anticipated to take place this summer. Watching how the businesses unfold will be amazing. I anticipate the outcome of these events to have major impacts on eCommerce in the United States and crossborder. It will also create major transformations in supply chain logistics.”

 

Meet Graham – The Road Warrior from Down Under

"Graham" highlights automotive safety

In 2015 38,300 people were killed on U.S. roads, and 4.4 million were seriously injured, meaning 2015 likely was the deadliest driving year since 2008. (NPR)

The biggest rises in traffic deaths were in:

  • Oregon  +27%
  • Georgia  +22%
  • Florida  +18%

Some states saw a decline in traffic deaths:

  • New Mexico  -20%
  • Kansas  -7%
  • New Jersey  -2%

This rise in fatalities is especially troubling since vehicle safety has improved significantly in recent years. So perhaps the problem is not so much the car as the driver.

This is the premise behind a safety campaign in Victoria Australia, which seeks to highlight the fragile nature of the human body.

Meet Graham – Road Safety Project in Victoria

Graham is a road warrior from Australia, the result of a collaboration between Victoria’s Transport Accident Commission, VicRoads, Victoria Police, the Department of Justice and Regulation and the Department of Health and Human Services.

Graham, unlike us, is designed to survive violent confrontations and collisions with vehicles.

Of course, we don’t look like this because we’re not designed and built to withstand the massive and violent forces of a vehicle collision. And that’s the point of Graham. He’s what we’re not. He’s designed for impact. We’re not. In a car crash, his odds of survival are great, ours odds are not.

[Graham is a] reminder of just how vulnerable our bodies really are when speed and impact forces as low as 30km/h are at play.
MeetGraham.com.au

Hopefully Graham will spark a little reflection and caution among driver. Time will tell.

Learn more at the website: Meet Graham

 

Super Ships: The Biggest Ships in the World (Part 2)

The Largest Ships in the World

This part 2 of our look at the largest ships in the world. You can read Super Ships Part 1 here on the Emma Maersk container ship.

Super Ships Gain Weight

In 2011, the Triple-E Class Maersk ships, coming in at 400 meters in length (1,312 ft) and capable of carrying 18,000 20ft containers, nudged beyond the Emma to take the honors. The “Triple-E” stands for Economy of scale, Energy efficiency and Environmentally improved.

The Maersk Triple-E Class
Maersk Triple-E Class Vital Statistics (courtesy of Maersk Line)

In 2014, the gigantic Triple-E Class ships would be joined by the equally mighty CSCL Globe also 400 meters (1,312 ft) but capable of carrying even more TEUs, 19,100.

Just one year later, three ships surpassed the Globe in TEU carrying capacity, MSC Oscar, MSC Oliver and MSC Zoe, all measuring 395.4 m or 1,297 ft, with a carrying capacity of 19,224 TEUs.

The Biggest Ship Ever Built

As huge as these ships are, none of these is the largest ship ever built. That title goes to a super tanker called Seawise Giant, also known as Happy Giant, Jahre Viking, Knock Nevis, Mont. Sadly, Seawise Giant is no more, she was scrapped in 2010.

Her vitals were impressive.

In length she surpasses both the early half a kilometer in length (458 meters), a staggering 1502 ft.

It took her 5.5 miles to come to a stop. If you wanted to turn her around, you’d need at least 2 miles to do it.

What's longer than the Empire State Building, takes 5.5 miles to stop and 2 miles to turn? Click To Tweet

Seawise Giant had a turbulent history.

She began operating between the Middle East and the United States, then she docked in Hormus in Iran and was used as a floating storage ship.

In May 1988, Iraqi jets bombed the Hormuz Terminal. They inflicted massive damage on Seawise Giant using parachute bombs while she was anchored off Larak Island. She eventually sunk. (Wikipedia: Seawise Giant)

Seawise Giant in flames in May 1988 in Hormuz after an attack by the Iraqi air force.

After her sinking she was bought and repaired and renamed Happy Giant. She was back in service in 1991. Shortly after she was relaunched she was sold and renamed Jahre Viking and flew the Norwegian flag. In 2004 she was sold and renamed Knock Nevis and used as a storage tanker in the Persian Gulf. She ended her days as Mont and was beached in India in 2009, though her 36 tonne anchor was saved is on display at the Hong Kong Maritime Museum.

Onboard Jahre Viking – Largest Man-Made Moving Machine

We end with a quick tour of the Jahre Viking, above and below deck, courtesy of Jeremy Clarkson.

References

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How to Maximize Warehouse Space and Efficiency

Alex White is Senior Marketing Officer at Western Pacific Storage Solutions

Warehouse efficiency is impacted by many factors, including your layout and shelving choices.

Maximizing the storage space in your warehouse is a critical task to gain flexibility for a variety of storage needs. Whether your warehouse is partially empty or packed full, the efficiency of the layout allows for organized storage that is easy to access and inventory.

Industrial shelving systems that make the best use of the available space can offer vertical storage and immediate access for employees to provide a quick response and outstanding customer service. A good storage solutions company will have the shelving systems expertise to provide answers to your storage organization needs.

Industrial Shelving

Warehouse Industrial Shelving (courtesy WPSS)

A good warehouse shelving company offers many types of industrial storage shelves, including riveters boltless shelving, gravity carton-flow shelving and platform or mezzanine shelving.

  • Boltless shelving offers simple installation that can be accomplished with only a rubber mallet.
  • Steel shelving provides strength for maximum payload capacity in the size and shape (you require) for your customized needs.
  • Closed shelving, open shelving and multi-level systems provide protection and offer quick access to products.

Lengthy spans, secure bracing, simple assembly and easy forklift access are assets for your warehouse and allow you to focus on business growth rather than storage complications.

Is Your Warehouse Full?

A disorganized warehouse is an inefficient warehouse. (Courtesy WPSS)

In many cases, a full warehouse is simply a disorganized warehouse with inadequate shelving. By identifying problem areas, you will find the opportunity to improve efficiency while using every bit of room. Floor space is finite, but vertical storage can offer a huge increase in the amount of product that can be stored. Vertical storage requires the right type of shelving for the products with a focus on safety and easy access. Using available warehouse space poorly is a common problem, and it is easily resolved with custom industrial shelving systems.

In many cases, a full warehouse is simply a disorganized warehouse with inadequate shelving. Click To Tweet

Inventory Efficiency

Even when business is strong, a warehouse can suffer from sluggish operations due to an overabundance of stock or slow-moving inventory. The need to store product in aisles, on docks or other inappropriate spaces throughout the warehouse can become a roadblock to efficient service and can also cause safety issues by blocking visibility and access.

Creating a new design for industrial storage shelves is an investment in the continued efficiency of your warehouse. When your warehouse is well organized, you’ll also be able to quickly identify bottlenecks without analyzing inventory data.

Warehouse Aisle Width and Layout

Aisle width is also important to consider when choosing industrial shelving solutions for your warehouse. Wide aisles make it easy for employees and forklifts to move throughout the space, but does your shelving design and spacing optimize the use of your warehouse?

Redesigning your warehouse is an investment, but it is one that should pay for itself in a short period of time with more efficient product handling, safer operations, storage flexibility and the ease of locating product in a tidy, well-organized space.

Redesigning your warehouse is an investment that quickly pays with efficient product handling, safer operations and… Click To Tweet

The assistance of an industrial shelving company with a variety of shelving types and styles will help you evaluate your floor and aisle configuration while choosing shelving that will maximize your available warehouse storage.

Mezzanine Shelving

Warehouse Mezzanine Shelving (courtesy WPSS)

One of the most efficient ways to gain vertical space in the warehouse is the addition of mezzanine or platform shelving. With the ability to gain room by adding a second floor of storage, you will create the ideal space for small amounts of inventory, broken cases and loose inventory items. Because mezzanine shelving offers a second layer of flooring, it can also be used for work functions such as packaging or shipping preparation while leaving plenty of room for large, heavy products on the ground floor.

Warehouse Shelving Size and Spacing

Evaluating shelving storage for size relative to the type of inventory that is being stored can also help to maximize the efficiency of your warehouse. Valuable space that isn’t filled or is too large for smaller items can be evaluated and reorganized. By storing smaller products on industrial shelving that specifically meets their size needs. The larger spaces can be reserved for big or fast-moving items to increase access and efficiency. Best practices include keeping frequently accessed items closer to the dock and shipping office so they can quickly be loaded and stored or retrieved.

Tune Your Warehouse Efficiency and Enjoy Years of Returns

Evaluating and reconfiguring your warehouse with the help of a storage solutions company is not a simple project; it requires careful planning and high-quality industrial shelving systems that are perfectly tailored to your unique needs. However, taking the time to configure and organize your warehouse now will serve you well for many years, as it will result in a warehouse that allows your business to run like a fine-tuned machine.

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Big Data, Big Visibility

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Small Data, Big Insights

small dataLowes Foods, a family-owned grocery chain with stores located throughout North and South Carolina, is one of the region’s largest retailers, but in the late 2000’s they had a problem.

He's a genius using Small Data to uncover stunning and brilliant insights... Click To Tweet

Declining revenues, triggered by the onslaught of ultra-competitors like Walmart and Amazon threatened the very existence of this 100-or-so retail chain, and unless something was done Management contemplated the closing of a number of stores – which, as everyone knew, would really flip the switch to the inevitable death-spiral of cost cutting and downsizing.

Data to the Rescue

Fortunately, Management took action. They turned to data analytics to help – even before analytics was in vogue. But instead of utilizing what now is known as Big Data, they retained an analytics expert in a different, and more important, field. The retained the services of Martin Lindstrom.

Martin is one of the world’s leading branding experts and, arguably, the leading guru in a different form of analytics.

He’s a genius using Small Data to uncover stunning and brilliant insights that, in turn, form the basis of new strategies and tactics that help organizations, like Lowes Foods, thrive.

Instead of slicing and dicing volumes of data – which, as a retailer, Lowes had – his work focuses on very small learnings and observations about customers and indeed, Americans in general.

Small Data Delivers Insights Where Big Data Overwhelms

It’s his contention that Small Data, done well, provides the insights and clarity needed that are almost impossible to find with volumes of data.

Big Data is about information. Small Data is about people – finding the needle in a haystack. Click To Tweet

For Lowes, he studied American culture – everything from values and beliefs but importantly very small clues that helped formulate his insight and strategy for Lowes.

As an example, he noticed that American hotels are hotels where the windows are locked. Coupling that with the number of gated communities and a few other small clues, he concluded the following: despite what they tell you, Americans live in fear.

Studying people around the world, one person at a time, he concluded that the last time people were not afraid was when they were children. Kids, regardless of culture, are by and large care-free.

So his strategy centered on making Lowes Foods more kid-like. More fun. More entertaining. The place to go.

Retail-tainment

The entrance was revamped to include both ChickenWorks and SausageWorks – where busy shoppers could buy ready-made meals. However, in keeping with the kids theme, the purveyors behind each offering were dressed up characters, complete with costumes that put on a show all day long. They would argue, shout at each other and generally give each other the gears. It was pure retail-tainment.

Now, Lowes Foods was always known for the quality of its fresh prepared chicken. In keeping with his insights, Lowes also implemented a new ritual. When batches of new chickens were removed from the oven, a notice came over the loud speaker and all employees, including Management, would break into their “happy chicken dance”, accompanied by a specific ditty to celebrate hot, fresh, quality chicken.

Another important piece of small data Martin leveraged was the passing of business cards in many cultures. In many cultures, how you hand your business card to someone is an important sign of respect and is done by slightly bowing down and passing the card with two hands.

This small data insight led to a change in how ChickenWorks dealt with customers. Now, purveyors of the chicken would pass the chicken to customers using two hands, while slightly acknowledging the customer in the process. This signals respect to the customer and that what is being bought is of high value – both for the customer, and also for the employee.

All small insights. All based on Small Data – observations and learnings by watching and talking to one person at… Click To Tweet

And it worked. Sales of ChickenWorks and SausageWorks skyrocketed. And Lowes Foods became known as the place to shop – a fun, unpredictable establishment where customers could buy good quality products, but enjoy themselves in the process.

For us supply chain planners, we’re bombarded every day with people touting the virtues and significance of Big Data. And, to be fair, Big Data is and will be important.

But so is Small Data. Small Data provides insights about people. Small Data opens clues to problem resolution that Big Data would suffer to uncover.

Small Data often provides the tiny clues and insights that drive real, significant change.

Small Data and Supply Chain Planning

Here’s a great example from supply chain planning.

For long time readers of our blog you know that the capability now exists to forecast and plan slow and very slow selling products at store level (or any final point of consumption). Hopefully you’re also aware that this allows us to Flowcast every product – that is create time-phased sales, inventory, supply and dollar projections, thereby providing the business with a consistent planning process and a single set of numbers across the organization.

Did you ever wonder how the solution for slow selling products came from? It came from Small Data (a data point from a single person).

The story goes like this. The architect of the solution was talking about planning at store level with a retail store manager in Canada, when the manager proclaimed the following, “I have no idea when these products will sell, all I know is that I’ll sell about 2 every quarter”.

Boom!

And the idea for integer forecasting and forecasting using different planning horizons (e.g., weekly, monthly, quarterly) was planted. Eventually this nugget of Small Data would be parlayed into the world’s leading and, to date, best solution for planning slow and very slow selling products at store level.

The architect of the slow selling solution didn’t get all sorts of slow selling data and then slice and dice the data to try to uncover a solution. Had he tried that approach, he’d likely still be working on it – just like most technology firms and academics.

When it comes to planning slow selling products, we owe Small Data some thanks:

First, Ken for the small data insight.

And then, Darryl for turning insight to solution.

Essential Reading on Data

Master Data Management

Master Data Management

How effective master data management can increase earnings per share, drive business value, and improve your company’s overall financial health.

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Super Ships: The Biggest Ships in the World (Part 1)

Imagine laying the Empire State Building on its side, and then floating it out to sea

Super Ships: The World's Biggest Ships

Picture the Empire State Building, that will give you an idea of the awe-inspiring size of a modern day super ship.

Keeping tabs on the biggest ship is no easy task. Not only are super ships being built at an unprecedented rate, but the way they are classified varies, from physical size, to their carrying capacity, which can also varying depending on whether measure by number of container or by weight.

But the fact remains, all these ships are huge and are certainly among the largest ships in the world by any definition.

The Biggest Ship in the World: Emma Maersk (2006)

Just ten years ago, Emma Maersk carried the honor, measuring 397 meters (1,302 ft) and capable of carrying 14,770 TEUs. (TEU stands for “twenty foot equivalent unit,” and and is used as a unit of capacity for container ships. A TEU is roughly the volume of a 20 ft long intermodal container.)

Mighty Ships: Emma Maersk (Documentary)

https://youtu.be/rG_4py-t4Zw

In a follow up article we’ll look at a few more giants of the seas.

References

Essential Reading on Supply Chain

Supply Chain's New World Order

Supply Chain's New World Order

Do you want to know what's coming in supply chain? Download Supply Chain’s New World Order.

Learn how companies are using the cloud for predictive and actionable supply chain analytics, integrated business planning and more...

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Replenishment: The Real Time Advantage

Speedy replenishment is critical to keeping customers satisfied and loyal. e

In today’s environment of demanding and fickle consumers, the importance of meeting customer demand and minimizing out-of-stocks is crucial. How do you do that?

There are a number of considerations, in this article I’ll cover one of the major ways, lead time reduction. In part two I will discuss another often-overlooked and underappreciated line of attack.

Let’s look at replenishment in the foodservice industry, as this is a particularly challenging industry with unpredictable and erratic demand.

In foodservice, time is your enemy. Extra inventory can quickly turn into waste, while any delays in the replenishment of inventory can result in lost sales, disappointed, or even lost customers.

How do you walk this fine line of tracking demand without carrying too little or too much inventory?

Forecast accuracy is important, but given the inability of most systems to forecast at the store level it is much more important to respond to demand signals more quickly. Shortening your replenishment cycle time to 2 days will have a much greater impact on service levels and virtually guarantee you are never out of stock.

A Typical Replenishment Example

Let’s take an example. Say the notification of point-of-sales (POS) transactions and updated inventory positions occurs at the end of each day.

Day 1: Capture POS and transfer to planning system. Update inventories. Update sales histories.

Day 2: Analysis of inventory and generation of new purchase orders.

Day 3: Vendor receives PO, analyzes and commits to a ship date based on available supply.

Day 4: Assuming the vendor has plenty of stock available; the order is shipped from the vendor distribution center.

That’s pretty fast for a system where each node analyzes and acts within 24 hours.

Real Time Information Means Rapid Replenishment

But what if it were faster?  What if there were a real time connection between stores and DCs?  What if information could flow between trading partners within the same network?  And what if we could automate the “analyze” steps and thus slash response time?

Day 1: Capture POS and transfer to planning system. Update inventories. Update sales histories. Automated purchase orders, automated order confirmation, automated shipping orders.

Day 2: Order ships from vendor DC.

It’s possible with a real time, multi-party cloud platform.

A Real Time Multi-Party Platform

With a real time, multi-party platform there’s no waiting for a nightly refresh, information is instantly shared with customers and their suppliers. Real time visibility is available to all trading partners, while data flows across the network, ensuring all parties are always in sync.

A real time platform also bridges the chasm that exists between traditional planning and execution, allowing plans to be formulated more accurately, based on real time execution data.

Consider stock-outs. If there’s nothing on the shelf or if menu items are unavailable, consumers cannot buy and you lose sales.  Or worse, they may opt to purchase a competitor’s product, or you might lose them as a customer completely.

This is where a real time cloud platform can help. First, since there is no lag, it is reasonable to expect replenishment time in our example to go from 3 days to 1 day.  The impact of this reduction can hardly be overstated. It means 2 days of sales where there would have been zero.  It means satisfied customers where there would have been two days of dissatisfaction and potential loss of loyalty.

Second, since statistical engines use historical data to predict the future, if that historical data includes zero sales, true market demand may be understated.  An advanced cloud platform can adjust for this by isolating stock-out periods and replacing zeros with an estimate of what sales would have been had there been stock available to purchase. This creates a more realistic picture and helps the engines produce more accurate predictions in the future.

This is just scratching the surface. A real time cloud platform offers other interesting and powerful possibilities, including, single version of the truth for all parties, end-to-end visibility, “demand sensing,” automated ordering and demand translation, and reduced IT costs. I will discuss some of these aspects in a follow up article.

Essential Reading on Foodservice and Replenishment

Improving Demand Planning and Replenishment in Foodservice

Improving Demand Planning and Replenishment in Foodservice

This industry spotlight on the foodservice industry looks at how companies can automate demand planning and replenishment and cut replenishment times by up to two days.

Improving Demand Planning and Replenishment in Foodservice

Brexit: What’s the Impact on U.S. Supply Chains?

How will U.S. Supply Chains Be Affected By Brexit?

Among the issues surfacing related to the impacts of the British vote to exit the European Union are questions regarding changes in supply chains, particularly by those owned by U.S. companies. Although the majority of immediate concerns has been driven by questions related to financial markets, as well as, of course, the political chaos occurring both in London and Brussels, business interests are also correct to be concerned.  After all, the original intent of forming the EU was the creation of the “Common Market” and supply chains have evolved in response to this goal.  Inasmuch as the U.K. and the U.S. are primary trading partners, let’s consider how U.S. companies supply chains will be impacted should the exit be final.

Brexit Has Implications for the Entire Supply Chain

Business supply chain impacts raise questions around BUY (purchasing), MAKE (where to produce), MOVE (freight), DISTRIBUTE (get to customers), and SELL (who buys, how, and why).  Our initial estimates should be considered near-term (what to expect now) and over time (what to expect as the exit plays out).

First, we should acknowledge that supply chains have many components:  customers, suppliers, operations strategy, products and markets, physical, business processes, technologies, people/skills, and capital investment.  They also have implications for domestic business as well as international (cross-border) business.  Further, there are domestic companies or business units that operate within the U.K. and MNC’s that either sell or source within the U.K.

Near Term Uncertainty Will Trigger Profit Warnings

One of the key business concerns, especially impacting supply chains, is uncertainty and/or risk.  As EU leaders debate the timing of the exit, the next 3-4 months are very likely to produce “profit warnings” due to the considerable uncertainty.  This will especially be true for those companies that rely on international sourcing, or sell a high percentage to the British population, or British companies that rely heavily on EU markets.  The uncertainty around the timing and necessary modifications of Trade Agreements, Customs Laws, Duties, and Tariffs, will impact sourcing, transportation, and distribution.

Who Will Be Affected the Most?

MNC’s that operate in the U.K. (or England) will be impacted through their supply chains with respect to any goods that are imported or exported.  Moreover, those that have their European HQ in England will need to re-assess their locations.

Those that manufacture products in the U.K. – automotive, for example – will be impacted by the sourcing of components (global sourcing means importation), as well as the exporting of finished vehicles.

The selling of products (SELL) has experienced substantial growth in e-Commerce. For domestic sellers, other than the cost of goods, very little supply chain impact will be seen on online ordering.  For those selling international goods, however, the costs of cross-border goods will be impacted.

Other than the costs of goods sold, we should not expect high levels of negative impacts on consumer goods and pharmaceuticals.  Consumers are the key to economic growth, and the demand for competitively priced products normally results in meeting the needs, in one way or another. But, for those companies that have Euro-market Distribution Centers located in the U.K., there will be serious questions about inventory locations.  Moreover, there are numerous other product categories that will be impacted, and perhaps seriously.

What Should You Do?

In the near term, we are advising client companies to begin to plan, and expand monitoring and tracking, and even start re-designing Logistics Networks.  We also advise, though, to not take hasty actions about investment, or disinvestment, until more is known about the timing of the exit and its ramifications.  Planning for contingencies – such as that associated with Supply Chain Risk Management – is the right action now.

With respect to overall supply chain strategy with Brexit, therefore, our advice for client companies is to think, question, and plan for when the exit changes are implemented.  Capital investment or disinvestment, in the U.K., should be postponed until made necessary by the new Trade Agreements, Customs Laws, Duties, and Tariffs that impact the company’s supply chains within the country.

Trends in Food Packaging

by Shalu Jain, Senior Marketing Executive at DCGPAC

Foodservice Trends: Food and Beverage Packaging

Emerging Trends in Food and Beverage Packaging

Shalu Jain, Senior Marketing Executive, DCGPACThe food packaging industry always proves to be highly competitive and vibrant. The industry is always refreshing itself and on the look-out for packaging materials and technology that offers enhanced convenience and longer shelf life to consumers.

The food industry knows very well that their consumers are always searching for the value, novelty and innovation when it comes to packaged food. It is for this reason that the packaging industry must continually innovate and evolve, or face stagnation.

Product packaging preserves freshness and the integrity of the product through its long journey to the shelf... Click To Tweet

The food packaging industry is huge and diverse, so I can only cover a few of the trends and innovations. Let’s get started.

Man examining product packaging at a supermarket
Product packaging plays a big role in preserving freshness and the integrity of the product through its long journey to the shelf. It also helps products get noticed by consumers and can help them make a choice based on what features and benefits the packaging highlights.

Understanding the Growth of Global Packaged Food Market

Creatively packaging products has remained a subject of constant concern in the industry. At the global level, food packaging has been using some new labelling techniques that ensure freshness, product tracking, product branding and more importantly- longer shelf life.

Globally, the beverage and food packaging industry is the world’s largest consumer of plastics. This is expected to rise further, with rigid plastic food container demand expected to increase by 5% per annum, reaching 118 billion units representing $5.4 billion by 2017.

This tremendous growth of global packaged food market is due to the innovative packaging providers offering a  wide range of food packaging materials that make possible more creative and innovative packaging for their products.

Plastic has been behind a lot of growth. Its strength and versatility means that is well-suited to all stages of the supply chain journey, from factory, transit, shelf to home.  Paperboard, metal or glass alternatives do not withstand the rigors of the journey as well and can end up looking worse for wear or needing extra packaging to help protect them.

The food and beverage market is still hungry for innovation, particularly in plastic technology, where companies see an opportunity to enhance the demand of their foods and beverages.

Visible Trends in Food Packaging

1. Adding a dimension to packaging- Giving the foods & beverages a character and personality

Colorful character food packaging (Courtesy: Flickr user Ahn Nguyen

What all do you see in modern-day packaged food items? Here are some of the features the leaders include in their packaging to set themselves apart.

  • Style – a unique style stands out from other brand and is immediately recognizable to consumers
  • Visual appeal – well chosen color palettes, eye-catching visuals wrapped up in bold and sophisticated design
  • Functionality – packaging that is easy to open and reseal if necessary
  • Self-Working – the “Selfie” generation wants everything to be self-sealing, self-opening, self-cleaning, self-closing, self-regulating, self-dosing and self-heating
  • Experience – create a memorable experience by adding a touch of texture to packaging
  • Practical – packaging that makes on-the-go consumption easy and avoids mess

2: Packaging for “green worriers” and sustainability concerns

A 2014 internal Tetra Pak survey covered over 25 countries across the globe. It found that today’s consumer is well-aware, more concerned and willing to do anything to bring about a positive change in the environment.

The survey revealed that:

  • Of all the consumers in the developed nations, approximately 87% had “somewhat serious” concerns regarding the international environmental and climate change.
  • 94% of the consumers in these nations had concerns regarding pollution.
  • A quarter of the survey’s respondents felt that they were responsible for doing things that were not good for the environment.

Today’s consumers expect companies to be aware of environmental concerns.

The latest example is FSC-certified paperboard that acts as a sustainable packaging for Georgia peach smoothie.

However, in a 2012 report from PwC, it was found that the concept of “sustainable packaging” proves to be a rather useless term because it’s generally impractical, and there is no generally accepted meaning to the term “sustainable packaging”.

So now, the result is that this term has found a replacement with “packaging for green worriers.” Companies are catering to the “green worriers” by implementing and encouraging things like recycling, effective after-use disposal, display efficiency, transport efficiency, minimizing product waste and using the least possible resources. The goal is to minimize environmental impact, and lower economic and social cost.

3: Digital Designing

One of the most important visible and upcoming trends in food packaging is digital designing or designing for the computer world. What does that mean?

In the above sections, we talked about style plays and visual appeals. Here we are talking about shelf appeal. Packaging with the “bill-boarding” potential, the ability to print the entire packaging and not just a part of it or a label, is ideal for modern campaigns. Such packaging offers a full canvas for high impact and attractive graphics, with bold colors and characters which catch the eye and attract consumers.

In the world of 2D online shopping, these high impact printed packages, flat and space-oriented packs have a big advantage over more traditional packaging that is partially printed or uses labels.

4: Packaging with the city-dwellers in mind

Demographically speaking, the people that consume the most packaged foods and beverages are urban-dwellers. Many of them live in smaller spaces. Such consumers want packaging that is lightweight, compact and sturdy. One trend in food packaging is offering compact packaging to this segment, so that these consumers can stock up without filling up their living space..

5: Packaging for Food Marketing and Health and Safety

Packaging today is done with a concern for logistics and food marketing. It’s helpful to understand what “food marketing” is.

“Food marketing” is all the activities that occur between the food producer and the consumer (Wikipedia: Food Marketing). The number of participants and activities involved can be huge. According to Wikipedia:

“Fifty-six companies are involved in making one can of chicken noodle soup. These businesses include not only chicken and vegetable processors but also the companies that transport the ingredients and those who print labels and manufacture cans. The food marketing system is the largest direct and indirect non-government employer in the United States.”

The key for food packaging here is strong, lightweight materials and easy to access and handle packaging like tetra packs.

Another concern is health and safety. With food products being transported and handled by multiple parties, it is important that the packaging is robust and keeps the food and drinks fresh. Vacuum, gas, aseptic and sterile packaging are used to enhance the transit life, shelf life and storage life of our food.

Conclusion: Even Better Design and More Secure packaging

The modern consumer is ever-more demanding and always on-the-go. They expect and enjoy creative and functional packaging. The leaders in the food packaging industry are living up to this challenge and will be expected to constantly innovate to meet the high expectations of today’s consumers.

We can expect packaging to evolve constantly. It will have to be flawlessly functional, greener, more compact, lighter, sustainable; but also highly visible and stylish.

Essential Reading in Foodservice

Improving Demand Planning and Replenishment in Foodservice

Improving Demand Planning and Replenishment in Foodservice

This industry spotlight on the foodservice industry looks at how companies can automate demand planning and replenishment and cut replenishment times by up to two days.

Improving Demand Planning and Replenishment in Foodservice

How to Lead Change with Minimal Resistance

Change Management: A Guide to Leading ChangeLeading change is not easy. One of the difficulties is gaining support from staff members. Communicating the rational for change and repeating your message is important in order to gain staff support.

Leading change is difficult but a learned skill, therefore improvement is possible. Click To Tweet

Explain the Change

The first step is to begin on a positive note and be convinced yourself that the change is for the best.

  • The leader must have the courage to deliver bad news.
  • Given that people in general remember negative events best, the leader must be clear, concise, and communicate positives as well. Negative or critical comments become the focal point.

Be Accountable

Leaders must acknowledge mistakes and accept accountability.

  • This builds trust as staff understands the notion that we cannot be right all of the time.

Communicate and Engage

Ask questions, instead of issuing orders.

  • This helps to engage staff and let them be a part of the change.
  • People do not like being ordered around, particularly when facing a major change.
  • Open communication and real conversations regarding the impacts of the change is necessary.

Acknowledge and Motivate

Praise and encouragement are keys to tackling change.

  • When giving praise, be genuine and sincere, deliver praise as soon as possible, make it specific, and do it publicly if appropriate.
  • When communicating with staff during a change, provide encouraging words. Show that you believe in your staffs’ capabilities and focus on what motivates them.

Set Expectations

Expectations are challenging during a period of change.

  • Leaders must get people to believe they can change and chances are they will.
  • Give staff a reputation to live up to.

Leading Change is Challenging, Give it Time

Leading change is difficult; it takes time, effort, and good communication. It is a learned skill, therefore improving your capabilities is possible. Most staff members want to do the right thing although, there are times staff needs a push in the right direction. If you fail in your attempt to lead a successful change, learn and try again.

Disruption and the Rebirth of the Rust Belt

Albany, NY, reborn as a hot spot of innovation.

I’ve spoken a lot about the benefits of disruption recently, but what of the companies and people in the wake of disruption, the ones who bear the brunt of the changes and see their industry or livelihoods evaporate?

Disruption and Dissent

This is nothing new. Ever since the industrial revolution, and probably earlier, as technology has shifted, so people have been displaced. It can be painful, frustrating… even violent.

“There were many sources of disharmony… Some employers used false weights in giving out yarn and nails… Textile workers mixed butter and grease with the fabric to increase the weight.”
– The Industrial Revolution, T.S. Ashton, 1948

When the first rattles of mechanization began to replace weavers in the late 18th century England, discontent simmered. In 1779 Ned Ludd snapped. In a fit of rage he allegedly took a hammer to a stocking frame, and sparked the “Luddite” movement dedicated to destroying machines.

The Luddites were most active around 1811-16, when they actively planned attacks and practiced drills. They not only destroyed machines, they burned down entire mills, and on at least one occasion, assassinated a mill owner. It was so bad that industrialists  had secret rooms built in to their factories so they could hide in the event of an attack. (Source: Wikipedia: Luddites)

Cartwright's mill under Ludditeattack.
British soldiers defend Cartwright’s mill during a Luddite attack. (Courtesy British Library)

The British Army eventually suppressed the Luddite uprising, and Parliament enacted harsh penalties which ultimately ended the Luddite movement. Yet the Luddites have been around in some form ever since.

When the automobile came along, no doubt there were cries of “But what will become of the buggy makers?” Such pleas are heard every time innovation disrupts an industry, even today, when we should know better.

Ned’s hammer has been replaced with legalities. The neo-Luddites are lobbyists, taxis drivers versus Uber, auto dealers versus Tesla, hotels versus AirbnB, retailers versus Amazon.

Displacement is Temporary

The truth is, people who are displaced will do something else, many will move on to  better things. They will no longer work inefficiently, building obsolete products and delivering expensive services that no one wants. Instead they’ll do more meaningful and valued work, perhaps learn new skills and master new technology.

Often, the very industry that displaced them will be the source of many new jobs and opportunities. As the economist Henry Hazlitt noted:

“Before the end of the nineteenth century the stocking industry was employing at least a hundred men for every man it employed at the beginning of the century.”
(Economics in One Lesson, Henry Hazlitt, p50, Arlington House, 1979)

The market is dynamic in that respect, labor and capital flow to where it is most productive, fueling new growth and new opportunities in new industries.

Rebirth of the Rust Belt

Such a change is happening in the Rust Belt. Laura Putre has an interesting article in IndustryWeek detailing this transformation, where old manufacturing cities such as Akron, Albany and Pittsburgh, are remaking themselves as modern manufacturing and technology centers. Take Akron, Ohio:

Sixty years ago, Akron, Ohio’s rubber industry employed more than 50,000 people. But in the 1980s, as three of the four major tire companies left the city, most of those jobs disappeared. Times were dire for years, but gradually the region began to capitalize on its existing strengths—the material science expertise of its research universities, its workforce of engineers, scientists and tradespeople—and reinvent itself as the center of the polymer industry. According to statistics from the city’s website, upwards of 35,000 people in the Akron area are now employed in approximately 400 polymer-related companies.
(Source: From Rust Belt to Brain Belt)

This story of transformation and rebirth is repeated in cities such as Albany NY and Pittsburgh. Some European cities are undergoing a similar process.

What’s Driving this Rebirth?

Putre refers to an interesting new book, “The Smartest Places on Earth: Why Rust Belts are the Emerging Hotspots of Global Innovation,” which provides some answers:

“…Brain Belts’ have what emerging markets don’t: a skilled manufacturing workforce, a well-developed system of research universities and a culture of innovation.”

All three are important, but that last, “a culture of innovation,” is key and was certainly something the Luddites lacked.

So while disruption benefits everyone, it inevitably brings a certain amount of (temporary) turmoil in its wake. That “churning” can be a valuable source of new innovation and new opportunities. That is, provided we are willing to learn, work and embrace change and innovation.

For more more details on how and why the rebirth is happening, read IndustryWeek’s From Rust Belt to Brain Belt.

References

  • The Industrial Revolution, T.S. Ashton, Oxford University Press, 1992.
  • Luddites, Wikipedia
  • Economics in One Lesson, Henry Hazlitt, Arlington House Publishers, New York, 1979
  • From Rust Belt to Brain Belt, Industry Week

 

Warehouse Replenishment: Friend or Foe?

By Greg Kreis
Principal, Tompkins International

Warehouse Replenishment

Nobody likes replenishing pick locations.  It is a non-value added task that occupies labor and equipment resources without directly benefiting the process of completing orders.  Let’s not even talk about case replenishment which creates an additional touch for each case.  Actually, I think we should talk about it.

All too often we visit prospective clients who have made the decision to limit replenishment to pallet quantities or not replenish at all because it is viewed as a waste of resources.  However, willingness to increase replenishment means a decrease in the size of pick locations which translates into reduced travel distances for order selectors.

Willingness to increase replenishment decreases the size of pick locations meaning reduced travel distances for… Click To Tweet

What is the Right Replenishment Strategy?

What is the right set up for your operation? That depends.

Let’s look at a simple example to illustrate the type of evaluation that is necessary to make the right decision.  We have 100 items that each ship 6 order lines per day (600 lines per day total) which equates to 1 full case per item per day.  The product can either be picked from pallet locations or carton flow.

Replenishment Scenario #1: Pallet Replenishment

  • Pallet pick locations are 4’6” wide each for a total pick path length of 450 feet
  • In a set up such as this each operator can pick about 75 lines per hour so it would require 8 hours to pick the orders
  • There are only 4 pallets to replenish each day at a rate of 10 pallets per hour which will only take 24 minutes or .4 hours
  • The total man-hours required to pick and replenish in this scenario is 8.4 hours

Replenishment Scenario #2: Carton Flow and Case Replenishment

  • Carton flow locations are 12” wide stacked 4” high so the total pick path length is 25 feet long
  • With this picking arrangement an operator can pick about 200 lines per man hour which results in about 3 hours to complete the orders
  • Replenishment of the 100 cases is done at a rate of 35 cases per hour for 2.9 hours
  • The total man-hours to pick and replenish in this situation is 5.9 hours

You can see with the examples above that using carton flow pick location and replenishing in case units can result in a reduction of man-hours.  While, this is not always the case, it is certainly worth considering when deciding which type of operation you will use for the next 5 to 10 years.

The moral of the story is, sometimes tasks that look cumbersome or create extra touches can actually benefit the overall operation.  Replenishment of pick location is one of those tasks.

Lessons from the Foodservice Supply Chain

The Foodservice Supply Chain

Challenges and Opportunities in the Foodservice Supply Chain

Is there any supply chain more important than the foodservice supply chain? It supplies us with the very material that makes up and fuels our bodies. So how healthy is the food supply chain?

Food Logistics magazine reports on a survey conducted by HAVI Global Solutions and Technomic which provides some answers. There are some interesting findings on the challenges being faced and some clues to what makes for a successful foodservice supply chain.

Challenges in the Foodservice Industry

The foodservice industry is facing its own challenges, shifting consumer preferences are a big one, organic, local and gluten-free have shaken things up considerably. Consumer tastes are more diverse than ever. And of course, there’s government regulation, particularly the Food Safety Modernization Act which requires the industry be more vigilant with regards to food safety.

Many of these challenges are out of the hands of foodservice companies.

The Food Logistics article notes that logistics is also a big concern, with distribution costs up across the board. That’s not surprising, as many industries are grappling with the same challenge.

The maturity of the supply chain and its integration strongly affects performance... Click To Tweet

One of the points highlighted is that the maturity of the supply chain has a strong influence on performance (except in fast food which has unique problems). “Maturity” in this context refers mainly to the degree of integration among the various supply chain functions and departments.

Less mature, less connected and integrated supply chains are struggling to compete with the more integrated ones.  It’s in this realm that foodservice companies can begin to take control of their supply chains and manage them more effectively.

Opportunities: Communication and Collaboration

One of the most interesting and profitable takeaways is that collaboration is absolutely critical. Food Logistics reports that

“…collaboration among the supply-chain, culinary and marketing departments is becoming more critical to improving performance. Key elements are: collaboration culture and frameworks; forecasting sophistication; and near-real-time visibility into changing conditions. … And as collaboration increases—with internal functions like marketing and finance and with external partners such as suppliers and distributors—the supply chain evolves to encompass more capabilities.”

Source: How Agile Are Today’s Foodservice Supply Chains? FoodLogistics.com

I think the last part of that is especially important. Collaboration within the four walls of a company is important but trivial compared to collaborating with your external partners such as your suppliers and distributors. (This goes to the point mentioned in my article on “the edge effect”, where often the real obstacles and value lies not within the enterprise, but at the intersection of enterprises.)

“The best in class collaborate with all supply chain partners… When they take a collaborative approach, there tends to be more information shared among business partners, which leads to a reduction in waste (cost) and better service when the product is at the right place at the right time at the right cost.”
Cullen Andrews, vice president of national accounts at Dot Foods, Inc.

Collaboration (and visibility) is crucial to all companies, not just in foodservice, because the real world is not static, it’s in constant flux. It’s the ability to respond rapidly to those changes that determines success. As the article notes:

Collaboration enhances foodservice supply chain efficiency.
Collaboration enhances foodservice supply chain efficiency.

“While the big chains’ supply-chain managers can check off an impressive list of capabilities, we’re seeing a paradigm shift in the definition of supply-chain maturity; the drive to success is no longer focused on cost, but on collaboration, agility and adaptability.”

The article goes on to note some examples of collaboration among foodservice companies and their partners. For example, one distributor is now preparing dedicated and isolated pallets of raw chicken for its foodservice customers, to minimize health risks. Another food company prepares pallets in its warehouses to help customers cross dock.

There’s a lot more in the article and I encourage you to read it.

Healthy Diet of Data: Uniform, Accurate and Real Time

One of the key takeaways is that sharing uniform, accurate and timely data, is critical to enabling end-to-end supply chain visibility. This is where a real time, multi-party network excels. Also, sharing information not only about the usual supply chain events, but about processes and activities, can lead to significant opportunities for collaboration in other areas that help both parties reduce costs and speed up the supply chain. A multi-enterprise social network can be a great catalyst to exactly that kind of communication.

It might be profitable to consider what your partners can do for you to make your job easier; and most importantly, what you can do for your customers to ease and enrich their lives.

References

“How Agile Are Today’s Foodservice Supply Chains?” Food Logistics Magazine

Essential Resources

Improving Demand Planning and Replenishment in Foodservice

Improving Demand Planning and Replenishment in Foodservice

This industry spotlight on the foodservice industry looks at how companies can automate demand planning and replenishment and cut replenishment times by up to two days.

Improving Demand Planning and Replenishment in Foodservice

 

How to Handle China in Your Distribution Network

By Jim Serstad
Managing Director, Asia, Tompkins International

Distribution Network Design in China and Asia

Reconsidering the Conventional View of China in Your Distribution Network can unlock new potential in Your Supply Chain

It is common to treat China as an independent network in distribution network design. However, this approach should change.

Given the size and complexity of China, it seems reasonable to optimize it as an independent network from inbound port to customer. However, as China becomes more inter-connected with the rest of Asia, it is no longer so simple. There are more nodes that connect China to the rest of Asia, which means more opportunities for cost savings and lead time improvement.

There are more nodes that connect China to Asia, so more opportunities for cutting costs and lead times Click To Tweet

The reasons project teams treat it separately are often very practical: project scope and timeline, data availability, and sometimes simply because the project budget owners are China-based managers. Setting aside these reasons, consider how China should ideally be viewed in the context of an Asian network. Multiple port alternatives, cross-border ground transportation, and free trade agreements should all be considered.

Multiple Ports of Entry

The argument for multiple ports includes risk mitigation – as the Tianjin port explosion reminded us – and the savings generated by ocean versus ground shipment. It might be preferable to ship by ocean directly to a northern port than by ground from, say, Shanghai.

This argument will inevitably occur between APAC freight managers, who want to avoid breaking shipments, and China distribution managers, who want to reduce their domestic transportation cost. The answer is not always easy, multiple ports should be investigated. The selection of ports is inherently tied to the overall Asia network, if not the global network. Inbound freight cost and lead time needs to be part of the decision.

Ground Transportation

As sourcing migrates out of China, there is an increasing opportunity for ground transportation from southeast Asian sourcing countries back into China. With truck transportation being possible from Singapore into China, southeast Asia could be included in the same network with China.

For shorter distances or for time-sensitive goods it might make sense to consider ground transport. In particular, Hong Kong and Macau will be increasingly integrated with the Pearl River Delta region. Improvements, such as the Hong Kong-Zhuhai-Macau bridge, scheduled to open in 2017, should provide further incentive to investigate savings and lead time improvement in the region.

Free Trade Agreements

With globalization and growth of Chinese manufacturing, Chinese container ships are a common sight.Finally, the proliferation of free trade agreements and the implementation of preferential duties over the next several years are breaking down some of the barriers that typically separate markets in Asia. If your company has an Asia distribution center in certain countries such as Singapore or Malaysia, then store-ready orders could be picked there, while still achieving preferential duties on many goods.

This works because the China-ASEAN FTA allows for back-to-back certificates of origin for goods from ASEAN countries, though in most cases you will need to specify the destination country at the time of shipping from the country of production.

Nevertheless, this significantly reduces the number of lanes which need to be direct-shipped from vendors in order to get preferential rates.

Why China network design should be well-integrated with the rest of Asia... Click To Tweet

Considerations of multiple ports, increased cross-border ground transportation, and, free trade agreements, China network design should be well-integrated with the rest of Asia. 


 

Essential Reading

10 Facts You Didn’t Know About China’s Super Consumers

 

Find the Value Effect in your Business Environment

How biology can shed light on business

Supply Chain Value Effect

“The edge effect” is a term from ecology that I believe can give us insight into how we can improve business and the technology used to power it.

First, what is an “edge” in this context?

An edge is where two different biological “communities” or landscapes meet. So for instance, where the sea meets the beach is an edge, and where a forest ends and the savanna or grassland begins is an edge.

The “Edge Effect”

“The ‘edge effect’ is an ecological concept that describes how there is a greater diversity of life in the region where the edges two adjacent ecosystems overlap, such as land/water, or forest/grassland. At the edge of two overlapping ecosystems, you can find species from both of these ecosystems, as well as unique species that aren’t found in either ecosystem but are specially adapted to the conditions of the transition zone between the two edges.”
(Source: “Edge Effect” Deep Green Permaculture)

There’s a richness at the intersection of these different environments, and it’s not just because the intersection contains members of region 1 + region 2. The intersection creates a new transitional environment that supports entirely new species that are not native to zone 1 or zone 2.

So the overlap is greater than the sum of its parts.

These areas of intersection are called “ecotones,” and they have a very interesting property. Besides having more diversity, they are also more productive.

How so?

There are a number of reasons but here are two relevant ones:

  1. This relatively small area has three different environments with a highly concentrated diversity of species, animals, insects, vegetation, water and ground conditions. If you live there, you have access to all these different resources.
  1. Energy flows between these neighboring environments, transferring nutrients, insects and material between the two. For example, the tide and waves will ebb and flow along the beach, throwing sea creatures and sea weed onto the beach, and taking sand, critters other material from the beach into the sea. Similarly wind will blow over the savanna and carry grass, leaves and insects into the trees on the edge of the forest.

“Okay Bruce, but I’m not in the landscaping business, so what do grass and bugs have to do with me?”

The Value Effect

Well think of your business as an environment. You have your own unique product/service, your own team members, management style and technology to tie it all together.

If your business is any good, which I’m sure it is, you have trading partners of some kind, vendors and customers. Each of those companies, and your customers, are separate but adjoining environments.

Do you see where I’m going?

Now where are the richest and most productive regions? Within the box that is the company, or along the edges, the boundary where the energy ebbs and flows, where information, goods and services are exchanged and transferred into new products and into money?

I’d argue it’s at the intersection, the ecotone. The transfer of energy, or trade, is essential to any business. This intersection is where “the gears mesh”.

Great value lies where enterprises intersect, where information and goods are exchanged Click To Tweet

Without the “pull” of demand from one region, there would be no need to produce a good or service in another region. If you’re not trading products and services, not exchanging value for value, in some form, I don’t know what you are, but you’re not a business.

I call this the “value effect”.

How to find value in your business - look to the edges...
The riches and opportunities in business often lie in the edges, in the ecotones, in facilitating the flow of energy across the boundaries between businesses.

The more you can facilitate the flow of energy, information, goods and services across the econtones of businesses, the more value you can create. All other things being equal, the business with a vibrant flow of information and goods flowing freely between its trading partners, is likely far healthier than the business where that flow is inhibited, and only happens in periodic bursts, nightly or weekly.

Networks Not Chains

With today’s globally distributed supply networks, it’s become more urgent than ever to keep the energy flowing and to make the exchange of information, communication and collaboration among trading partners swift and friction-less.

This is not achieved by treating business and supply chains in the traditional, linear fashion. A more accurate and productive perspective is that of an ecosystem or network, where all parties are connected seamlessly, where information and goods can flow unimpeded.

How does your technology landscape perform?

References

Essential Reading

What Makes ONE Different?

The Network and Digital Supply Chain Disruption

The digital supply chain is causing disruption. Early adopters are making impressive gains, while cautious companies are falling further behind. One Network can help you digitize your supply chain fast – thanks to its disruptive technology, and economically – thanks to its disruptive business model. Learn how…

Download What Makes ONE Different?

 

Supply Chain's New World Order

Supply Chain’s New World Order

Real time networks are replacing traditional supply chains. Learn how companies are using real time, cloud networks for predictive and actionable supply chain analytics, integrated business planning and more…

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Is Flowcasting the Supply Chain Only for the Few?

Flowcasting the Supply Chain

Flowcasting has often been referred to as ‘the Holy Grail’ of demand driven supply chain planning (and rightly so). Driving the entire supply chain across multiple enterprises from sales at the store shelf right back to the factory.

So is Flowcasting a retail solution or a manufacturing solution? Many analysts, consultants and solution providers have been positioning Flowcasting as a solution for manufacturers.

They’re wrong.

While it’s true that some manufacturers have achieved success in using data from retailers to help improve and stabilize their production schedule, the simple fact is that manufacturers can’t achieve huge benefits from Flowcasting until they are planning a critical mass of retail stores and DCs where their products are sold and distributed.

For a large CPG manufacturer, this means collecting data and planning demand and supply across tens of thousands of stores across multiple retail organizations, all of which have their own ways of managing their internal processes.

At the end of the day, a manufacturer initiated Flowcasting implementation results in what amounts to a decision support/reporting system that isn’t directly integrated to the actual product movements that will occur from the factory to the store shelf.

Flowcasting is a retail solution that will greatly benefit manufacturers over time as more and more of their retailer customers adopt the concept.

Flowcasting is not a data collection and calculation exercise. It’s a planning philosophy that requires the folks on the front end of the supply chain (retailers) to change most of their business practices to be forward looking, such as:

  • Assortment planning and line review (including planogram resets)
  • Seasonal planning
  • Promotions planning
  • Network realignments (including store-to-DC network mappings and changes of source)

The retailer holds complete control over all of the above decisions. To the extent that they can change their processes to plan these activities in advance (and share those plans with manufacturers in a language they can understand), everyone in the supply chain benefits.

To the extent that folks on the back end of the supply chain (manufacturers) attempt to ‘work around’ retailer customers who are not thinking or operating in a time-phased manner, we are still left with a disconnected supply chain (perhaps with fancier tools).

You can’t push a rope, as they say.

The perception that Flowcasting is a manufacturing solution has led many people to conclude that Flowcasting is really applicable to only a few companies. If that perception were true, then the conclusion would be correct – but it’s not.

When we conceived of Flowcasting, we were really outlining the concept of totally integrating a retail supply chain – from point of consumption (consumers) to point of origin (the manufacturer’s manufacturers). I believe it’s why we called the book “Flowcasting the Retail Supply Chain”.

Now, the last time I checked there were more than only a few retailers.

Does Flowcasting apply to virtually every retailer? I believe it does. After all, don’t they sell products to consumers using physical stores, virtual stores, or a combination of both and supply those products via a network of distribution points? Couldn’t that be Flowcasted? Shouldn’t it be?

Our retail client in Winnipeg Canada is managing their entire business driven by a forecast of consumer demand, by item, by store (including web store), and translating those forecasts into the demand, supply, capacity and financial requirements for a 52 week planning horizon – including sharing purchase projections with their suppliers.

They have implemented and are doing what’s outlined in our book. They are Flowcasting.

Another misconception about Flowcasting is that all of the data must be in one place and being used by planners from both the retailer and manufacturer organizations. While this is an admirable (and likely achievable) goal, the Flowcasting planning process can be (and has been) achieved without it.

Flowcasting is about seamlessly integrating the entire retail supply chain from one forecast and working a common plan and a single set of numbers. Can and should a retailer manage their business this way? Without question and our retail client has proven it.

The point is that separate companies can be using the same numbers and executing the same plan without logging into the same system. We need to collectively get a grip on this and learn to determine the difference between what’s cake and what’s icing (and in this particular case, a few sprinkles on top of the icing).

To extend the thinking of Flowcasting even further, consider Flowcasting as a concept and a philosophy. A philosophy to drive the entire, integrated supply chain from a forecast at the point of consumption.

A couple of years ago, I had the pleasure to visit One Network Enterprises at their Dallas headquarters to talk about supply chain planning. Inevitably we got talking about Flowcasting.

During the conversations, Aaron Pittman and Richard Dean proclaimed to me that Flowcasting, as a concept, had widespread application. They insisted that the concept of driving a supply chain from point of consumption to point of origin applied to any industrial supply chain.

If you think about it, they are right.

Had we spoken to them before we wrote the book, undoubtedly we would have more aptly named it “Flowcasting the Supply Chain”.

So if you think the concept of Flowcasting applies to only a few companies…you’re right… Flowcasting does apply to only a few…

Only a few thousand!

The “Impossible” U-Turn

Well if you’d asked me to turn this truck on this road, I’d have said “impossible”. But this driver doesn’t let the difficulty deter him. It helps if you have skill too.

H/T: The Speed Society

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How to Nurture and Grow Your Customers

By Valerie Bonebrake, Senior Vice President, Tompkins International

3PL Strategy: How to grow and nurture your customers
Spring has arrived. It is time to cultivate. Use this primer to protect and grow your customer base.

I recently met with the CEO of a mid-sized third party logistics (3PL) company. We discussed the usual topics: industry trends, what is happening in mergers and acquisitions, and of course the conversation led to “how is business?” The CEO was pleased about some new wins but concerned about the portfolio becoming lopsided.

I asked him first about the new wins – new to outsourcing or wins over the incumbent?

In two instances the wins were over an incumbent. I asked him how he was able to win out over the incumbent. I can tell you that it was not a price play.

We then talked about the portfolio. The company’s success in a particular industry was cause for concern, too much revenue in one bucket presents some risk given the volatility of the industry.

Many changes are occurring in the 3PL industry and others right now. This conversation caused me to question whether companies are doing all they can to “protect and grow” their customer base.

As I was perusing one of my favorite magazines I was reminded – Spring is here – it is time to refresh flower beds, plant gardens, feed and water plants, and enjoy the benefits of beautiful flowers and delicious vegetables.

We should all take a lesson from Sunset magazine, Garden section. Use this primer to protect and grow your customers.

How to Protect and Grow Your Customers

  1. Treat a trellis as art – SUPPORT. Is your organization setup to support your customers? Your associates? A strong foundation will help your team and your customers grow and
  2. Pack in the veggies – CREATE and overall PLAN to GROW more than you ever imagined. What can you accomplish in the second half of the year that you might not have thought would be possible? Spring is a great time to revisit your plans and double down. Prune away what is getting in your way and create your plan to maximize results.
  3. Anatomy of a hard working garden – Built for PRODUCTION. Productivity and execution are table stakes. Do not forget the basics of hard work and execution – every day for every customer.
  4. Give herbs instant style – PROVIDE a SOPHISTICATED LOOK. Site visits can make or break a new opportunity. Look at your facilities through a new lens and create a WOW factor that will be memorable to visitors and make your associates proud.
  5. Savor special berries – PRUNE, FERTILIZE, and WATER. Stay the course! Nothing happens Your associates and your customers are special. Regular care and feeding is a must!
  6. Space-saver raspberry – UTILIZE SPACE effectively. Have you assessed your space recently? A proper layout designed with the right amount and type of storage and material handling equipment can drive as much as 30% improvement. Do not forget spring cleaning – shed old obsolete inventory.
  7. Plant a nectar bar – A vibrant garden needs POLLINATORS. Your customers value your cross-industry experience and shared practices. Do not let your teams get in a rut. Cross-location pollination is a must!
  8. Grow a game changing bloom – FULL Sun: FEED and CARE for regularly. Have fun! Change the Game! Enable your team to blossom and reach full potential.
  9. Go big with Foliage – The key to success is the RIGHT BLEND to make each stand out. Be bold and innovative! You need to stand out in today’s crowded field.
  10. Dream up a meadow – Gather Ideas, Make Things Better, INSPIRE.

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Top Opportunities for 3PLs and 4PLs

This paper discusses in depth, the top opportunities that 3PLs and 4PLs can take advantage of, radically increasing the value they provide their customers, and making them a kingpin in the supply chain.

Download: Top Opportunities for 3PL/4PLs

The Plane That Eats Trains

Antonov An-225 prepares for takeoff. (Photo courtesy of Flickr user: aseemsjohri)

The Soviet Union produced a range of airplanes during the Cold War era, from flawed to the occasionally fantastic, the sleek to the bulky and clumsy.

One that stands out is the Tupolev TU-144, aka “The Conkordski,” an obvious copy of the Concorde then nearing completion. The TU-144 was the first transporter to fly supersonic and the first commercial aircraft to break the sound barrier. But it’s glory was short lived.

The design of the plane was flawed and it suffered from instability in flight. At the 1973 Paris Air Show the plane broke up in mid-flight and plummeted to the ground in front of the crowd. That ended its career as a passenger plane. The plane continued to be used as a cargo plane but it was incredibly unreliable. It suffered 266 failures in only 180 hours of flying time, and ceased operating in 1983.

The Heavyweight Workhorse

At the other end of the spectrum, is the Antonov AN-225, otherwise known as “Mriya” (meaning “dream” in Ukrainian).

“It is not possible!”
-the pilot of the An-225 upon seeing the plane for the first time

28 years after it was built, it remains the largest aircraft ever built. Where the TU-144 was sleek and fast, the 225 is fat and beefy, with an appetite for swallowing up oversized and overweight cargo, like trains.

Oleg Antonov, designer of the An-124.
Oleg Antonov, designer of the An-124.

The Antonov is named after its designer, Oleg Konstantinovich Antonov, a Russian born near Moscow in 1906. Antonov built his first plane, a glider, at 17 years old. At 50 he designed the world’s largest turbo prop plane, the An-22. In the mid 70s he designed a heavyweight workhorse, the Antonov An-124.

The first 124 prototype flew in 1982, with the plane going in to production in 1984, the year Antonov died.

The following year the Antonov Design Bureau began designing a plane based on the 124, only bigger, the Antonov An-225, which  was designed to carry the Soviet shuttle “Buran.” While the basic design is similar, the 225 is beefier and has 6 engines instead of the 124’s 4. These engines generate 300,000 lbs of thrust. The 225 also has more wheels, 32 to be exact, which spread its immense load so it doesn’t “break” runways.

What weighs 628,317 lbs, has 32 wheels, swallows locomotives whole... and can fly? Click To Tweet

The 225 flew its maiden flight Dec 1, 1988. In just months it broke 109 world records, including the records for range, altitude, and cargo capabilities.

The Antonov An-225 - world's largest airplane

Abandoned… Then Reborn

After the collapse of the Soviet Union, funding for the 225 dried up and the 225 was abandoned and cannibalized for parts. That would have been the end of it, but the Antonov Design Bureau took a lesson from the West and turned capitalist.

They created Antonov Airlines and marketed their AN-124 fleet for carrying heavy, oversized cargo. It was a hit. The 124 carried everything from trains to 737 fuselages. The services of the Antonov Airline were in such demand, that after 8 years of lying dormant, engineers at Antonov decided to resurrect the gigantic An-225.

The 225, the only one in existence, would now be flying as a commercial plane, so not only did it have to be restored, it also had to be updated with the latest equipment and pass numerous tests before it could be certified for commercial flight.

It successfully achieved certification in 2002. In 2009 the 225 was renovated and modernized again, and it continues to fly to this day.

A locomotive is loaded into the Antonov An-225.
The An-225 carried a 109 ton locomotive, breaking the record for the single heaviest payload carried by an aircraft.

This heavyweight of the heavens can carry just about anything. Need to FedEx a train across the globe – check.  50 cars? Check. Wind turbine blades? Check.

The 225 has now broken 240 world records including transportation of the heaviest cargo (a generator weighing 417,000 lbs), the longest cargo (137 ft wind turbine blades), and the single heaviest payload (locomotive weighing 418,834 lbs).

For some stunning pictures of the 225 in action, visit the Antonov Company website. There’s also a documentary below covering the history of this incredible plane.

The Largest Aircraft in the World – An-225 Mriya Documentary

Resources

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Supply Chain's New World Order

Supply Chain's New World Order

Do you want to know what's coming in supply chain? Download Supply Chain’s New World Order.

Learn how companies are using the cloud for predictive and actionable supply chain analytics, integrated business planning and more...

Download Supply Chain's New World Order

Is Retail Still Stuck in the Seventies?

1970s were great, but I don't want to relive the shopping experience today.

The 1970s were great, but do you want to shop there today?

Retail is getting hammered by online merchants such as Amazon. We’ve seen many great retailers sink, and many more are showing signs of taking on water. As Jim Tompkins says, it’s time to respond to the titans. But where is that response?

Gene Marks went looking for it but all he found was the 70s.

Shopping in the 70s - Agony! Why are things still the same nearly 50 years later?
Why are retailers lagging in transforming our shopping experience?

He writes at Fox Business News about shopping today at Macy’s versus shopping with his mom back in the seventies:

“When I was about ten years old my mom used to take me to a Macy’s department store on Saturday mornings. We would walk around and around. She would try stuff on or make me try stuff on. There were always counters where special items were on sale. She would always buy something. And when she did we would go to the counter and she would pay with her credit card. The store assistant would wrap things up in a Macy’s bag. Sounds excruciating, doesn’t it?  Oh, it was.”

He laments that shopping today at Macy’s is much the same. None of the promise of a retail revolution driven by tech has come to fruition. Marks goes on to suggest some opportunities retailers should be capitalizing on.

“Where are the promised “beacons” that will notice me as soon as I walk into the store and alert my mobile device with bargains and offers based on my preferences and prior purchases? Why are the shop assistants still standing behind counters and cash registers instead of roaming the floors with tablets that are not only ringing up sales but recommending accessories and other items based on my preferences?”

“How come, with all the talk of Apple Pay, Android Pay, PayPal, Square and Samsung Pay I’m still whipping out my old-school credit card every time I want to make a purchase? And why is it that, even with all the new chip cards and warnings from the credit card industry, I’m still swiping like my mom did decades ago? Wait – what happened to the promise of those RFID (Radio Frequency ID) tags that would be attached to every item for instant inventorying and checkout through a scanner?”

I recommend reading the full article: Why Is Retail Still Stuck in 1976?

Disruption Is Here, Retailers Need to Adapt and Respond

Coincidentally, at this week’s Retail Innovation Conference in New York, the topic of disruption and the lack of response from retailers was a major theme. Kasey Lobaugh, Deloitte’s Chief Retail Innovation Officer, lamented retailers’ blatant disregard and outright denial of the disruption that is imminent.

“I’d have retail executives say to me, they’d say: ‘Disruption, nah. Look, I’ve been in this business for 40 years and it’s always been cut-throat, it’s always been tough, it’s always been competitive,’” Lobaugh said. “I’ve had retail executives look at me and say that there is nothing different today.”
Source: Do or Die: How retailers can innovate in an age of disruption, Kelsey Lindsey

The are a lot things retailers can do, as Gene Marks hinted at above, but the fundamental approach has to change. Retailers have to “turn inside out.” Instead of being focused on their product and internal operations, they need focus and organize around the consumer. As Aaron Dane of Point Inside put it:

“…Retailers should look to become shopper-centric in every aspect of their business. This focus should be applied when developing a new technology, a new way to market to the customer, or even when brainstorming a new store concept.” (Source: Do or Die)

Retailers need technology that not only enhances the shopper’s experience in the store, but that enables an entire consumer-centric ecosystem to support the delivery of that experience. Enterprise-centric software still based on thinking from the 70’s won’t do either.

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Frost & Sullivan Celebrates Innovation and Excellence Across the Globe

Frost & Sullivans Best Practice AwardsThere are some valuable takeaways from the Frost & Sullivan’s Best Practices Awards. 

Frost &  Sullivan’s Best Practices Awards are held annually and recognize companies for superior leadership, technological innovation, customer service, and strategic product development. The awards are conferred upon companies around the world and across a diverse range of industries.

Frost & Sullivan presents the awards “to companies that are predicted to encourage significant growth in their industries, have identified emerging trends before they became the standard in the marketplace, and have created advanced technologies that will catalyze and transform industries in the near future.” The goal is to “drive innovation, excellence and a positive change in the global economy by recognizing best-in-class products, companies and individuals.” (Source: Frost & Sullivan)

Past winners of the awards include HP, Intel, General Electric, Honeywell, Bendix and Verizon.

Winners are selected based on how they exemplify best practices in their industry. Frost & Sullivan’s industry analyst team benchmarks market participants and measures their performance through independent, primary interviews, and secondary industry research in order to evaluate and identify best practices.

Supply Chain Management Best Practices Award

This year One Network is honored to be included in the Product Leadership category for Supply Chain Management for Public Sector and Defense. I wanted to share some highlights from the award report that provide insight into the problems and solutions companies face in today’s market.

The Market Challenges

Frost & Sullivan sees an urgent need for companies “to improve their customer service, working capital and cash flow, operational efficiency, profitability, and market share. Along with this, companies report to Frost & Sullivan how they are also focusing on reducing inventory levels, eliminating supply chain disruptions, and reducing Information Technology (IT) costs, with a view to transform and accelerate their business operations amid changing market demands and rising competition… The lack of a seamless operation among many of the service arms and agencies tends to directly affect optimal financial performance; Frost & Sullivan notes that it also hinders the ability to identify growth opportunities and reduce incurred costs.”
(Source: 2016 Best Practices North American Supply Chain Management Product Leadership Award, Frost & Sullivan)

It is these challenges, certainly not unique to the public sector and defense industries, that can only be solved by flexible technology that embraces the reality of today’s global, multi-enterprise, multi-echelon world.

Meeting the Challenges: The Network Approach

Frost & Sullivan firmly believes the vendor that can “effectively address these prevalent challenges with a multi-enterprise and multi-echelon solution will secure a leadership position in the North American supply chain management market.” (2016 Best Practices North American Supply Chain Management…)

With all parties on the same network, with total visibility and integrated planning and execution, the advantages are compelling. “The substantial increase in the volume of actionable insights available to customers using One Network’s Real Time Value Network™ solution for effective planning and optimization provides users with better demand visibility, control, and execution abilities.”

It’s these advantages that the United States Marine Corps (USMC) enjoys, using One Network’s platform to manage their global ammunition, including small arms, artillery, tank ammunition, missiles and rockets.

Embodying the “seamless integration” theme, One Network integrates with a multitude of internal and external legacy systems, including 192 MILSTRIP and MILSTRAP message sets. It provides inventory visibility into 124 sites around the world, manages $8.04 billion worth of inventory, and has reduced transaction error rates dramatically, from 64% down to 0.3%.

A many-to-many and multi-echelon network is a proven solution to the problem of fragmented legacy systems and managing multi-party processes such as are common in supply chain management. It’s an option that companies should carefully consider.

If you’re interested in learning more about the challenges you need to overcome to proper in today’s economy, and the kind of technology that can embrace today’s distributed and complex business relationships, I recommend reading the full Frost & Sullivan Award Report. You’ll get a clearer picture of today’s challenges and the best way to solve them. I’d also recommend reading Supply Chain’s New World Order which addresses the new realities of today’s economy and the necessity for a new model for supply chain management.