This Week in Logistics News (September 9-13, 2013)

Document less, experience more. That was the key takeaway from a great HBR article by Daniel Gulati published in April 2012. I was reminded of that article when I came across the video below this week, which saddened me and made me realize that I need to work harder on keeping my phone in my pocket.

Moving on, here’s the news from the past two weeks that caught my attention:

Descartes reported Q2FY14 revenues of $38.2 million, a 25 percent year-over-year increase. Revenues for 1HFY14 are up 20 percent compared to the same period a year ago. Over the past eight years, the company’s quarterly adjusted EBITDA has experienced a CAGR of 36 percent.

While Descartes’ financial results (driven both organically and via acquisitions) are impressive, the metric that most interests me, as an advocate of Supply Chain Operating Networks, is that more than 147,000 parties are connected to its Logistics Technology Platform exchanging more than 4.5 billion messages each year. To paraphrase the old Verizon Wireless ad campaign, I believe “It’s the network” that will increasingly differentiate supply chain and logistics solution providers moving forward.

In other technology news, LLamasoft introduced “multi-objective optimization technology that enables businesses to analyze the trade-offs between multiple supply chain objectives for faster, more informed decision making.” Here are some more details from the press release: 

Multi-objective optimization is an integrated tool within LLamasoft Supply Chain Guru supply chain modeling software that allows users to quickly view the trade-offs between [supply chain design] objectives in order to select the best solution.

 

Using a simple user interface [emphasis mine], the tool automates the analysis of trade-offs across 19 available objectives. Multi-objective optimization automatically optimizes to and provides insight into any two best solutions, such as lowest cost and best service, then quickly presents the trade-off analysis between the two.

Historically, these types of optimization tools were limited strictly to power users because of the specialized knowledge required to use them effectively. However, LLamasoft and others are now focusing to make these solutions more accessible to a broader range of business users, and they are starting by innovating the user interface (see “Will Supply Chain Software Vendors Start Competing on Design?”).

I keep making the case that companies need to rethink supply chain risk management — i.e., embed risk within their corporate DNA, and make conversations about risk as common as conversations about cost and service. The good news is that new solutions and services continue to emerge in this area. This week, for example, Resilinc introduced EventWatch™ Professional, “a new supply chain risk management service providing 24×7 monitoring and detection of global events that threaten to disrupt supply chains worldwide.” According to the press release: 

Resilinc monitors thousands of global news sources, identifies critical supply chain developments, and then filters, researches and notifies clients regarding potential supply chain threats. Intelligent filtering capabilities eliminate redundant notifications and reduce time spent on non-supply chain impactful events.

 

Resilinc EventWatch monitors more than 25 different types of disruption events ranging from catastrophic global crises, such as earthquakes, hurricanes and floods, to isolated incidents such as factory fires and port and labor strikes, as well as government regulatory actions.

Speaking of supply chain risk management, one of the greatest risks companies face is not having a detailed understanding of their end-to-end supply chain. In other words, companies are often blindsided by “I didn’t know that” situations, such as unauthorized factories making products for them (see WSJ article, “Why Retailers Don’t Know Who Sews Their Clothing”). That was one of the topics I discussed yesterday in my Talking Logistics episode, “Why Supply Chain Visibility Remains an Elusive Goal.” Shortly after the episode ended, I came across a Reuters article about Land’s End investigating a report that some of its clothing is being manufactured in North Korea, which is against U.S. law. According to the article: 

NK News reported on Thursday that at least five dress shirts branded with Lands’ End labels — but displaying “Made in China” tags — were seen on a rack at North Korea’s Sonbong Textile Factory in June.

 

Lands’ End said “it is too early to say” whether it is a case of counterfeiting or a supplier outsourcing manufacturing into another country, spokeswoman Michele Casper said.

Like I said yesterday, unless you invest the time, money, and resources to fully map your end-to-end supply chain, you will always have blind spots in your supply chain, no matter how fancy a supply chain visibility tool you implement.

And with that, have a happy weekend!

Song of the Week: “Counting Stars” by OneRepublic

Note: Descartes and LLamasoft are Logistics Viewpoints sponsor.