Earlier this summer, FourKites held a Carrier Visibility Summit. This was an online event. One of the speakers was Abby Weisenberger, a distribution consultant at Kimberly-Clark. What made Ms. Weisenberger’s presentation particularly interesting was that while Ms. Weisenberger is leading their digitally enabled shipping initiative, she works in distribution operations rather than transportation. FourKites is […]
The big news in the Olympics this week is that Simone Biles withdrew from the all around gymnastics competition. Biles is the best gymnast the world has seen. She is a four-time gold medalist, reigning world champion, and has four different skills named after her! She still has moves that she can do that no […]
Select Energy Services, a leading provider of water and chemical solutions, has a fleet of roughly 2,000 trucks nationwide. These trucks make deliveries to, and pick-ups at, oil and gas wells engaged in hydraulic fracturing in every US oil and gas basin. This involves more dangerous driving conditions than other trucking jobs, which led the […]
The steel industry is not easy. A ton of steel can cost as little as $700. A pound of apples costs about the same as a pound of steel, yet steel is a complex product produced using high-tech metallurgical and manufacturing processes. Even before the pandemic the global steel industry was navigating significant disruptions that […]
There are valid reasons for space launches. The GPS navigation we use in our cars would not be possible without satellites. The Space Station supports scientific research, so space flights that shuttle astronauts and freight to and from the station are valid. And unfortunately, missiles and satellites are necessary for defense. But space flight to […]
During most of the pandemic, convenience stores were considered an essential business and were allowed to remain open. But Casey’s General Stores was, arguably, the most “essential” of all the convenience store chains. The company has traditionally located its stores in smaller towns and rural communities not served by national-chain convenience stores. Last year’s annual […]
What would most revolutionize logistics over the next few years? The most obvious answer is autonomous trucking. But when will this technology become operational? Will it take decades? A decade? Or can we get there in the next few years? That is the core question. TuSimple – a provider of autonomous freight semi-truck solutions – […]
Business professionals talk about “agility” and “resilience” as if they are the same thing. They are not. A company with an agile supply chain can react quickly to big increases or decreases in demand. An agile company is like a half back in football that can dart quickly to the left or the right depending […]
In May of 2019, the Washington Post reported that “inside several of Amazon’s cavernous warehouses, hundreds of employees spend hours a day playing video games. Some compete by racing virtual dragons or sports cars around a track, while others collaborate to build castles piece by piece. But they aren’t whiling away the time by playing […]
When companies implement a demand management or replenishment system, the goal is usually to improve customer satisfaction while holding less inventory. Pinnacle Propane implemented demand management, replenishment, and order promising solutions from John Galt Solutions with the goal of improving service – reducing what they call “out of gases” – while reducing transportation costs. The […]
With the onset of the Covid-19 pandemic, Cardinal Health made the decision they needed enhanced visibility into PPE shipments as demand for these products surged. Since then, FourKites has become a key steppingstone in their journey to build a next generation control tower. In an interview, Sean Halligan, the senior vice president of pharmaceutical operations […]
Indirect sales, brand owner sales through sites like Walmart.com or Amazon, are an increasingly large portion of sales for many companies. In 2020, ecommerce sales accounted for 14 percent of total retail sales in the US. But of ecommerce sales, 86% come from indirect channels, rather than a company’s own website, according to CommerceIQ. For […]
Walmart has been very open about what it takes to compete with Amazon. Following their fourth quarter results, top executives talked about their supply chain and omnichannel strategy at a high level. Brett Biggs, an executive vice president at Walmart, summarized the investments by saying the retailer is spending on increased fulfillment capacity, supply chain, […]
There have been extensive supply chain disruptions caused by the global coronavirus pandemic. These disruptions have elevated the supply chain function to the boardroom level. It is now understood that supply chain agility is imperative. Supply chain collaboration networks, which provide wide ranging visibility to events occurring upstream and downstream in supply chains, can help […]
Pure Storage never stocked out during the pandemic. That was not because demand for their products tanked. Product sales were down by 8%, but the company did grow by 2% overall in the last fiscal year based on strong performance in subscription services. While demand from many customer’s decreased, some of their customers did place […]
On Monday, March 8th, a vice president of supply chain for a large retail chain – a chain with over 5,000 stores – spoke at Körber’s supply chain conference Elevate. Körber is a leading provider of logistics software, material handling, voice, and consulting solutions. This retailer seeks to become a leader in employing people with […]
5G represents the next generation of broadband cellular technology. I have written before that 5G for supply chain applications is still at the hype stage. However, the 5G protocol is slowly evolving to add more features for industrial applications. The promise of 5G is alluring. Thus, it was of interest to me to hear what […]
Peet’s Coffee was going through a digital transformation when Covid-19 hit. Despite the significant amount of effort involved in going from running a business on Excel spreadsheets to implementing an enterprise resource planning (ERP), they are very grateful that their efforts to improve their supply chain agility were underway when the pandemic hit. Founded in […]
Dave Elias, vice president of supply chain management, and Josh Stauffer, senior director of IT, spoke at ARC Advisory Group’s Supply Chain Forum. Both men work for HarbisonWalker International (HWI). Mr. Elias and Mr. Stauffer spoke about the digital transformation the company is going through. They have implemented a broad suite of enterprise and supply […]
According to one survey, only 27% of leaders believe that they have the talent needed to meet current supply chain performance requirements. What should supply chain leaders be looking for to close the talent gap? AGCO has received well deserved acclaim for the agility with which they navigated the pandemic (How They Did it: AGCO […]
Körber, which was known as HighJump Software until about a year ago, completed their virtual Elevate Americas user conference. Despite the pandemic, it was a good year for the supply chain group at Körber (Körber rhymes with Gerber, the baby food company). This group had record revenues. The company had 300 new customers and 100 […]
Belcorp’s Maturity in Supply Chain Design When companies implement enterprise software solutions, they often label that implementation as being part of their company’s digital transformation. But implementing new software does not digitally transform anything if the people that are supposed to use that software cannot do so effectively. Belcorp has actively worked to be a […]
GlobalTranz, a logistics service provider, put out a press release on February 23rd where they mentioned that they had achieved 40% growth in revenue, fourth quarter of 2020 compared to the fourth quarter of 2019. GlobalTranz’s main service lines are freight brokerage – less-than-truckload and truckload – and managed transportation services. As such their closest […]
The tobacco industry is changing. Traditionally, the industry has been stable. The prevalence of smoking is going down, but the world’s population is increasing; the net result is that the forecast for the number of smokers is essentially flat in 2025 as compared to 2010. Because of this stability, at Philip Morris International (PMI), one […]
Raj Govindarajan agreed to answer questions about KeHE Distributors digital transformation. Mr. Govindarajan is the Senior Director, Supply Chain (Systems, Processes & Analytics) at KeHE. KeHE is a national wholesale food distributor that has been in business for 70 years. Steve Banker: Tell me about KeHE and KeHE’s supply chain! Raj Govindarajan: At KeHE Distributors, […]
Jeff Stiles is the VP Solutions Marketing at Oracle. Oracle is a sponsor of ARC’s Supply Chain Forum. One of the sessions at our forum involves an Oracle customer. Executives from HarbisonWalker International are talking about how their broad implementation of Oracle Cloud applications allowed them to unleash continuous innovation. Jeff and I discussed the […]
There is a new generation of control towers, far more robust than what we have seen in the past. Covid-19 has served to highlight just how important supply chain agility is. The key building blocks for the modern supply chain control tower includes data from key supply chain partners, robust supply planning, and a master […]
ARC is getting ready for our Supply Chain Forum on February 16th and 17th. I was originally scheduled to speak. But we ended up with a good problem. We have so many good, high level executives speaking, we canned my speech (Forum Agenda). End users – supply chain practitioners working for manufacturers, distributors, or retailers […]
A101 is the fifth fastest growing retail company in the world. Their convenience stores – whose average footprint is 250 square meters – offer everyday low prices; customers don’t have to pay a premium for convenience. This has proven to be a successful strategy for Lidl and Aldi as well. A101 is the largest retailer […]
Last week marked one year since COVID-19 was confirmed in the United States. The US’s death toll now stands at more than 400,000 lives. President Biden said at a White House press conference on January 21st that the Trump administration’s distribution of COVID-19 vaccines has been a “dismal failure.” The new President set a goal […]
Do you want visibility or transparency? Polly Mitchell-Guthrie, posed that provocative question to supply chain professionals on her LinkedIn feed. Ms. Mitchell-Guthrie is the VP of Industry Outreach and Thought Leadership at Kinaxis. Kinaxis is a top supplier of supply chain planning software. She went on to say, “visibility is widely considered a new supply […]
Some suppliers of supply chain planning (SCP) software are experiencing robust growth despite the global pandemic. This is particularly true for suppliers offering Concurrent Planning solutions.
Even as Target Corporation’s ecommerce becomes a bigger percentage of their sales, their gross margin continues to increase! This is not suppose to be possible. How did Target accomplish this?
Agile has been embraced by system integrators serving the warehouse management system market as a project methodology that can speed implemenations and reduce customization. That leads to a better ROI.
Global supply chains have changed more in the last six months than they have in the last six years. Never has the need to respond with agility been more clear. Control towers are a key tool to achieve agility. New solutions are available.
Companies have been whiplashed by the combination of a long running pandemic and the recession it kicked off. Better planning can help companies mitigate the effects of this crisis. Sandy Evett, the vice president of distribution and supply chain at Dawn Foods, gave a presentation on how her company has responded.
Many companies have a sales & operations planning process. If S&OP could be adhered to, it would maximize profitability. But it can’t. Hexion is implementing a sale & operations EXECUTION process to improve agility while preserving profitability.
It is widely said that there is a the trend toward more warehouses being built, and a trend toward smaller warehouses being built in urban areas. This is being driven, by the rapid ecommerce growth rate and increased competition among retailers to get their goods to consumers more quickly. Data shows this is largely a myth.
Warehouse management systems are Big Data applications. They can struggle to provide the real-time analytics needed to run a responsive and agile distribution operation. There is a solution.
Task interleaving is a best practice in a warehouse. Task interleaving allows work to be done more efficiently. A warehouse management system can save companies money in many ways. Task interleaving is just one good example.
Industrial setting must be kept safe during the Pandemic. Warehouses that use RF guns and warehouse management systems have solutions that enforce social distancing and contact tracing.
Baseball has a key performance indicator that is unrivaled. The Wins Above Replacement Value tells a team exactly what they need to do to succeed. In business, and the supply chain realm, no other success metric has this clarity.
Class 1 Railroads Have Been Charged with Unfair and Arbitrary Demurrage Fines My colleague Muhammad Wasay Rashid has just completed a market study on the adoption of Internet of Things (IoT) technologies by the global rail industry, including the freight segment. Mr. Rashid reports that sales of IoT technologies for Rail are bigger, and growing […]
Wake Forest Baptist Health has begun drone deliveries of medicines and blood. As soon as a patient checks in at a Wake Forest Baptist Health infusion clinic, their specific medicine is created at the hospital and flown over via drone, creating an on-demand pharmacy for medicine with a short shelf life. Wake Forest Baptist has […]
In December of 2019, the global grocery retailer Ahold Delhaize announced it was investing $480 million to transform and expand its U.S. supply chain operations in support of a new three-year strategy to move to self-distribution. In self distribution, the company insources many supply chain activities that were formerly outsourced. Ahold Delhaize was formed in […]
A Hi-Tech Company’s Control Tower Helped It Better Manage Air Cargo During the Worst Days of the Pandemic In 2014, one of the world’s largest high-tech manufacturers started thinking about a digital transformation that would help them better serve their customers while also generating operational efficiencies. From a supply chain perspective, a robust supply chain […]
Being a socially responsible company can create a strong brand, a committed workforce, and loyal customers. It comes at a cost. The products will generally be more expensive, limiting sales. Progressive companies are often small, requiring them to use less-than-truckload. Less-than-truckload has adverse service and environmental impacts. In short, fair trade and environmental initiatives lead to socially responsible manufacturers having more complex supply chains.
Ecommerce sales have boomed during the pandemic. Young technologies that support last mile deliveries are getting increased attention. Which of these technologies have the most potential post-Coronavirus?
COVID-19 has put supply chain organizations under great strain. But there has been one nice side effect in the consumer goods supply chain. SKU proliferation has been reversed.
Medtronic MDT has been engaged in a digital transformation. This includes building out a digital twin of their end-to-end supply chain to make it easier for people to make better and faster supply chain decisions. The company has built a data lake to feed LLamasoft’s Supply Chain Analytics Platform, llama.ai, to create their supply chain digital […]
Managed transportation service providers compete on their tech stack. The transportation management system is core, but the platforms also have complementary applications, visibility and advanced analytics.
With the rise of Uber Freight, digital freight brokerages have gotten a good deal of investor and shipper attention. A digital freight brokerage uses technology to make the process of working with a broker to secure a move more automated and less time consuming.
Managed transportation services providers have planners in a control tower using TMS technology, who plan and execute loads on behalf of their customers. The main reason shippers enter into these arrangements is for freight savings. But as this case study makes clear, managed transportation can drive service imporvements. These can be strategic.
Supply chain control towers have come of age. The concepts that allow modern control towers to support agility are easy to describe. The technology that empowers these concepts are quite complex.
There are companies that have seen their shipping volumes surge during this global recession and pandemic. Many work with managed trans providers to secure capacity. This article describes the different tools managed trans providers use to secure transportation capacity.
Every few weeks I read a particularly well written and researched article on COVID. An article from the BBC – called Coronavirus: How scared should we be? – is the most insightful from the last month or so. The author, Nick Triggle, writes “There are two factors that influence the risk we face from coronavirus […]
Manhattan’s Active Labor Management built in new features supporting worker engagement. Historically, a labor management system was more like a slap than a hug. The way they have gamified the system is one of the drivers of their approach to worker engagement.
BD’s Control Tower provides end-to-end visibility of their supply chain. This has been of great value during the pandemic. This project is key to BD’s digital transformation. And with machine learning applied to Big Data, the solution will only get better with time.
Workers across many industries don’t feel safe during this pandemic. Autonomous mobile robots emitting UV light can help kill COVID-19 microbes and keep workers safe.
Because of the pandemic, risk management surrounding sourcing has become top of mind. One best practice in this area is to identify and qualify alternate suppliers. Companies need to ensure they have alternate sources of supply that can ramp up to the volumes needed. This best practice urges companies to examine not just the cost of the sourced products, but also to understand the risks associated with not multi-sourcing key components.
AGCO is a supply chain success story. This is the inside story of AGCO’s response to the pandemic and how they developed such an agile supply chain. Agility does not just happen. This global manufacturer of agricultural equipment began their journey to improved supply chain resiliency in 2004.
Because of social distancing, and the requirement for most Americans to stay home, we will have far fewer deaths from COVID-19. But our economy is also now in recession. Are the benefits from lives saved worth the costs in terms of jobs lost and the economy shrinking? Cost-benefit models say this was the right tradeoff.
Ports are critical nodes in global supply chains. Making sure that port-related supply chains operate smoothly is imperative for companies and nations. ElMarie Hugo from BlueYonder is an expert on these supply chains. In this interview, she shares her thoughts on making these supply chains work much better.
Companies with sustainability initiatives related to reducing greenhouse trucks often consider purchasing electric trucks. But companies need to pay attention to more than the purchase price. In particular, considerations surrounding the charging infrastructure can be complex.
Global Trade Compliance (GTC) solutions help companies follow complex trade rules. That is necessary buy not strategic. Sourcing is strategic. GTC content is necessary for strategic sourcing. But what is really needed are engines that quickly allow companies to understand what they need to do in component sourcing for their products to qualify for duty free treatement.
Start making your contingency plans for coronavirus immediately. Here are 20 things to keep in mind.
Amazon gets plaudits for their supply chain innovation. But when it comes to sheer cost savings driven by supply chain efficiencies, it is hard to beat BJ’s Wholesale Clubs. Traditional brick-and-mortar retailers are said to be struggling because of Amazon. There is research that shows wholesale clubs and supercenters have been the bigger threat.
Global hi-tech companies are struggling with the impact of the coronavirus. While the mortality rate at 2 percent does not sound like it should shut down global supply chains, 25 percent of those infected end up in intensive care. The high-tech industry is impacted particularly hard because so much of their contract manufacturing resides in China and they run JIT supply chains.
TireHub is working to transform the tire distribution industry. They are using digital, supply chain technologies, to create on service excellence. Interestingly, the company was formed by two competitors – Goodyear and Bridgestone.
What is the return on investment (ROI) associated with trade compliance? If compliance is understood as the chance that company might have to pay a hefty fine for noncompliance, then statistically, there is no ROI associated with compliance. You might think that would make it tough to sell this type of software. You’d be wrong. […]
When you read business magazines, it is easy to get the impression that business executives are overwhelmingly opposed to increasing tariffs. When it comes to US manufacturing executives, that is not true. A majority of manufacturing executives believe that a global recession is likely in 2020 (61%) and that an extended trade war would likely lead to a global recession (70%). Despite this, more execs support tough trade policies than oppose them.
The big event in Davos Switzerland is about to occur. Watching leading business executives prance around and pose is unseemly. But one good thing that comes out of this event is a Global Risks Report produced by the World Economic Forum. This report serves as a centerpiece for the themes addressed at the event.
On March 11, the World Health Organization officially classifying COVID-19 as a pandemic. At about that time widespread customer service issues surfaced across North America and Europe. Close to nine months later, we have seen some companies that handled these disruptions magnificently – they demonstrated supply chain agility. It is worth examining the playbook successful […]
Isn’t any model not based on paper and pencil a digital twin? What value does it add to call a supply planning model a digital twin? I thought it was hype. Supply chain planning executives disagree.
Oracle and SAP are the two largest suppliers of enterprise applications are also leaders in the supply chain planning (SCP) market, but the leadership is being contested. Their arguements for why customers should choose their planning solution go beyond their applications functionality. Interestingly, over time most enterprise applications markets consolidate. This is not happening in the SCP market.
Companies want to be responsive. But they also want to create business plans that give them some level of certainity that financial goals can be achieved. How do you do both? Supply chain planning with the ability to do concurrent planning is one answer.
While the SaaS era is better for customers, nothing beats a try before you buy program. Indeed, when it comes to enterprise software this is so rare it counts as radical business innovation. But that is exactly the deal Mayne Pharma got from Vanguard Software for their demand planning application.
In early November, the Northeast Cargo Symposium had a series of presentations and panels focused on how trade disputes are affecting companies that source from abroad. One session was called “Alternatives to Trading with China.” The key conclusions were that diversification from sourcing with China was already occurring before the trade war began, that in […]
I recently wrapped up my Supply Chain Collaborative Networks (SCCN)market study which looks at the total size of the market, the forecasted growth through 2023, and the leading suppliers across a number of categories including industry, region, and customer size. The study includes a holistic view of the SCCN outlook. Supply Chain Collaboration Networks are […]
P&G is respected for having one of the best supply chains in the world. They rarely speak about their approach to supply chain management in any detail. So, it was a treat to hear Bob Herzog, the Global Planning Digitization Leader for Supply Chain, and Pedro Noriega, Planning Director, North American Product Supply, speak at Kinaxis’ Kinexions 2019 user conference. P&G has developed one of the world’s most agile supply chains. To accomplish this, P&G embraced digital tools, a new network, and citizen developers.
Despite apparent recent progress in US/China trade talks, trade experts say not to read to much into these reports. The US/China trade relationship will never be what it was. There is blame on both sides, but US experts largely point at China’s unfair practices as being the largest impediment.
Land O’Lakes implemented a supply chain real-time visibility to improve their supply chain. Visibility and velocity are key to combating the natural variability that occurs in all supply chains. Once the solution was implemented, customer service has improved. Now Land O’Lakes is looking to use the network visibility to improve colalboration with key partners.
A loophole in a law designed to keep drunk and drug impaired truck drivers off the road is finally about to close. This will improve road safety by preventing 900 crashes. The trucking industry has long been in favor of this regulation.
Distributed order management systems, used to enable omnichannel retail, have a bad rap. One retailer believes the technology is getting much better.
Amazon has a new supply chain sustainability shipping option. With Your Delivery Day, customers can designate a day of a week when deliveries to the home can be made. This creates consolidation and optimization opportunities which is good for Mother Earth.
Coca-Cola Consolidated implemented FourKites’ real-time visibility solution. Change is hard, but real gains have been made in their supply chain operations. Brett Frankenberg, Senior Vice President of Product Supply Planning and Bottler Sales at Coca-Cola Consolidated described the journey at the FourKites user conference.
There are twenty things companies need to know if they are contemplating a digital supply chain transformation. One thing that is very important, is that they learn about a new set of solutions called Supply Chain Collaboration Networks.
Autonomous trucks will be technologically feasible for operation on the interstate in three years? Will they be on the road? The politics are difficult. There are trade-offs involving safety, jobs, and consumer prices. Even if the autonomous vehicle industry can make a valid argument that their trucks are statistically safer, will voters and politicians respond rationally to an accident with fatalities? Humans are not wired to think scientifically. We respond to powerful anecdotes much more readily than statistics.
The ATA, an association for truck carriers, has been reporting a truck driver shortage. The Bureau of Labor Statistics says this widely reported shortage does not exist. We as an industry have been too willing to accept the research of a self-interested body as credible. We should have known better.
Fleet telematics has a robust return on investment. Multitenant platforms can be an elegant way to collect Big Data. Big Data, used right, has great power. Put them all together and what do you get? An interesting logistics technology. The Geotab Telematics Platform Telematics solutions provide truck fleets with the ability to remotely monitor the […]
A small, thinly funded company – Starsky Robotics – was the first to test an autonomous truck on the Interstate. Starsky is zigging while the rest of the industry has zagged. Starsky is betting the simplicity in engineering will allow them to win the race to market autonomous trucks.
Robotic process automation (RPA) has gotten a good deal of attention. RPA is process automation software that is used to automate high volume, repeatable tasks. The process automation Dow is investigating and developing extends to higher level decisions for which robotic process automation is not well suited. What Dow is doing, however, is RPA taken to a whole other level.
Bonds had a yield curve inversion on August 14th. This often often signals a recession within about 14 months. Demand planning is difficult in these circumstances. This article discusses how supply chain teams can do better in these circumstances.
On Thursday, yield curves inverted and the stock market tanked. An inverted yield curve signals a recession in 14 to 20 months. Companies need to prepare by developing more agile supply chains. Integrated business planning and supplier risk management are critical tools.
Electronic Data Interchange (EDI) is cool again. Not all EDI, just EDI based on value added networks (VANs). The reason? More and more companies are engaging in digital transformations. In many companies supply chains, it is the end-to-end portion of the supply chain, knowing what upstream and downstream partners are doing, where there are digital black holes.
Digital supply chains seek to fill information black holes. For many companies’ supply chains, it is the end-to-end portion of the supply chain, knowing what upstream and downstream partners are doing and how well they are doing it, where there are the most black holes.
This week in logistics was dominated by trade news. It was decided that trade talks will resume in September. Then, after a negative article in the Wall Street Journal, more tarrifs were imposed. Meanwhile the Democrat candidates for President talked trade in their debates on Wednesday and Thursday..
Retailers face some tough dilemnas. Growing SKU counts drive worse on-shelf availability. Growing reliance on direct store delivery holds fulfillment costs down, but DSD suppliers goals are not fully aligned with retailers. One thing is clear, retailers need better visibility to stock outs at the shelf level.
Increased attention to truck platooning. In platooning, trucks are connected using direct vehicle to vehicle communication to allow trucks to tailgate each other very closely. This drafting creates fuel savings. There are two models for platooning. The opportunistic and the truck train model.
When logistics folks think about transportation, the pipeline mode is an afterthought. But it is a very important mode that gets far too little coverage and is not sufficiently well understood. Pipeline scheduling solutions are every bit as complex as other transportation management solutions.
Satellite imagery data represents another data set that may have the potential to improve company’s supply chains. There are potential uses surrounding procurement, sustainability, and strategic planning.
LLamasoft has developed a new supply chain control tower. What makes is so interesting is it’s engine. It is built on top of a supply chain reference model that contains supply chain policies. Once I peeked under the hood at this reference model, it became clear to me this could be a very robust solution.
Railroad customers objected to escalating fines across the country’s seven Class I carriers and referred to monopolistic, unfair, illogical, and arbitrary actions by most of the railroads.
The term supply chain control tower is being used more frequently. Some think it is being overused. What is a supply chain control tower? From my perspective it must be a holistic supply chain solution. What does that mean? For me, it means the following ten things.
Robotic Process Automation (RPA) is software that is used to automate high volume, repeatable tasks. RPA can be used to improve legacy supply chain software. Ryder is using it to reduce the work required to produce quality transportation plans.
Transportation produces large amounts of greenhouse gases. Ecommerce is inherently less green than traditional bricks and mortar retail supply chains; it contributes to larger transportation emissions than traditional retailing. Eddie Capel, CEO of Manhattan Associates, believes we need a more sustainable approach to Ecommerce supply chains.
PFG wanted to provide better selections of beef to selective restaurants. But the commodity beef supply chain made this very difficult. They built a new supply chain that included audits, DNA testing, and better pay for better quality products.
JDA Software introduced a robust new control tower solution at their user conference. This SaaS based solution provides real-time visibility to shipments, orders at risk of not being fulfilled, and several other supply chain issues. More importantly it is visibility and remediation. It is worth noting, that being able to tap into the supply chain plans provides a much richer predictive capability than control towers that only use execution data.
Traceability is one supply chain application that many pundits argue is a perfect fit for blockchain technologies. Subway and its Franchisee-owned supply chain are on an ongoing journey to improve their recall and traceability capabilities. Not surprisingly, they have taken a hard look at blockchain as a solution for improved traceability. So, what the Subway Franchisee-owned supply chain group have to say about blockchain is worth paying attention to. For now, blockchain is at the back of the bus.
It was recently announced that Walmart has expanded its use of autonomous mobile robots (AMRs) used for real-time, on-shelf product data. Walmart will put these AMRs in 350 stores. The robots come from Bossa Nova Robotics. I recently had the chance to talk to Sarjoun Skaff, the cofounder and chief technology officer at this San […]
Real-time visibility is a hot topic. Everyone seems to want it. But even if you buy this solution, you do not get 100% visibility. And the visibility has gotten worse because of recent regulatory changes. But you don’t need total visibility to get good ROI.
Uber has a very powerful brand name. It undoubtedly contributed to Uber Freight’s growth. But if this was a stand-alone prospectus for just Uber Freight, and if the Freight division did not carry the name “Uber,” who would be foolish enough to invest in them?
At HighJump’s Elevate show in March, one of their customers – Hollar – spoke about implementing an autonomous mobile robot (AMR) solution and getting an almost instantaneous payback. I have been covering supply chain solutions for a long time and I’ve never heard that claim made. Really excellent payback can occur in six months, a […]
Digitalization requires learning. Pilots of supply chain planning software can cost millions. How can companies test-and-learn cheaper and smarter? A conversation with the leadership team of Solvoyo suggests some answers. Solvoyo is in a test-and-learn with a very large consumer goods company.
In March, Infor had a customer event at their headquarters called “The Journey to an Autonomous Supply Chain.” “Autonomy” is their goal, but right now their GT Nexus product, recently renamed Infor Nexus, supports an orchestrated supply chain. If you look at the definition of orchestrated, you will see the word “arrangement.” And when the term orchestrated is applied to a music score, the arrangement is quite intricate. That certainly describes the supply chain operated by Havertys Furniture Companies, Inc.
Blockchain provides one mechanism for sharing information between supply chain trading partners. Because of the IT security, unchangeable records, and decentralized governance, the technology is getting a lot of attention. But just as clear thinking depends upon carefully defining terms, effective supply chain collaboration requires a defined vocabulary. Business is just easier when you speak […]
There are a lot more demand forecasts being made today at companies then their used to be. Many of these forecasts depend upon having more data. Traditionally, demand management applications used order shipment history to make forecasts. But gradually new data sets were added that improved the forecasting accuracy. A demand management application can truly be a Big Data solution today.
We just completed the new global market study on the Autonomous Mobile Robot (AMR) market. The market is exploding. In my twenty years of doing market research I have never seen anything like the growth this market is experiencing.
Canadian National is committed to sustainability and outperforms their peers in this area. Canadian National is using fewer railcars and locomotives to ship more freight. Achieving these gains have been aided by some interesting supply chain technologies. This is also good for the bottom line.
Kraft Heinz Company’s stock plummeted last week despite having one of the most efficient supply chains in their industry. The shares dropped as much as 28 percent one day after writing down the value of some of the Kraft and Oscar Mayer brands and other assets by $15.4 billion. The company’s portfolio is filled with food products like Oscar Mayer hot dogs and Kraft macaroni and cheese that are perceived to be less healthy by consumers seeking fresher, less processed alternatives.
The term “digital” has become all the rage. Parcel software, particularly the Public Cloud solutions, has been digital for decades. Parcel software provides label compliance, enables intelligent procurement, provides analytics and visibility to improve the shipping process, and allows for bills to be audited to insure the shipper has not been overcharged.
Vopak, a leading operator of tank terminals, is undergoing a digital transformation. One of their projects occurred at their Savannah terminal. New sensors, machine learning, and optimization drove significant energy savings.
I talked to a large ecommerce retailer. They got great benefits from implementing a supply chain planning solution. But their plans to leverage AI are what is truly fascinating.
Effectively pricing shipments in the less-than-truckload industry is fiendishly difficult. Leading LTL carriers talk about their approach to this issue.
Every year the World Economic Forum produces a Global Risks Report. The report includes a survey of around one thousand members of their stakeholder communities. The results reported are worth the attention of executives that participate in programs to assess and manage supply chain risks.
Starting in September 2019, Walmart will require suppliers of fresh, leafy greens to implement real-time, traceability of products back to the farm by participating in the Food Trust Consortium. The Food Trust consortium, run by IBM, is focused on using Blockchain for Supply Chain technologies.
Artificial intelligence is a hot technology. But is is a complex subject. This article seeks to explain the concepts, and simplify them, by focusing on how these technologies are used in supply chain management.
While Machine learning is hot and customers want to know how these technologies will be used in future SCP solutions, the truth is that machine learning is just one form of intelligence that can be embedded in supply chain planning applications. SCP solutions are smart.
Transportation Management solutions have a proven ROI. But the additon of Machine Learning opens up some exiciting possibilities. ARC is excited about the promise of machine learning to allow a TMS to better handle competing objectives and discover nonobvious impacts on performance.
DHL Supply Chain recently announced plans to deploy emerging technologies in 350 of its 430 facilities in North America. This is a $300 million investment. ARC had an opportunity to dive deeper into these investments with DHL’s North American leadership team.
When we think of strategists, we tend to think of men (C-level folks are still mostly men) with giant foreheads seeing things the rest of us cannot. But strategy is often more prosaic. For example, when it comes to supply chain strategy, there is a playbook that can be followed.
Many shippers are talking about becoming a shipper of choice to protect their service levels. But what do you have to do to become a shipper of choice? Does being a shipper of choice increase your costs? Does being a shipper of choice even matter? What does the research show?
New solutions have emerged that bridge the gap between supply chain planning and execution. These solutions have a middleware layer that is critical. The middleware allows for a feedback loop that can allow the system to get smarter.
The idea behind supply chain segmentation is that not all customers or consumers should be served with a one size fits all supply chain. Clorox has shown that implementing this strategy can drive great value. But it is not easy.
When it comes to driving autonomous trucks on the interstate, there are several issues that need to be solved. A startup called Wavesense has solved one key problem. The CEO of Wavesense talks with ARC about the other issues that need to be solved.
A new head of supply chain at Pfizer asked a simple question, “If Amazon can provide end to end shipment status of my orders, why can’t Pfizer.” That was the impetus for a supply chain visibility project. “The company had to change their mindset and embrace a global orchestrated supply network.
Digital twin is the phrase used to describe a computerized (or digital) version of a physical asset or process. The digital twin contains a sensor or sensors that collects data to feed the asset model. These concepts have implications for complex production scheduling.
Mike Reibsamen – the Director of Integrated Supply Chain – at Berry Global, spoke about Berry Global’s supply chain transformation at the Council of Supply Chain Management Professionals (CSCMP) annual conference in early October. Mr. Reibsamen’s primary point was that companies will get much better payback from their supply chain projects if they don’t do […]
Drivers have choices. So, it came as a great surprise to me when an executive at Netradyne said that his company’s camera and AI-based analytics system, used to improve driver safety, that is appreciated by truck drivers! In my experience, drivers don’t like Big Brother. I was skeptical. But the story checks out.
Abercrombie & Fitch has struggled. Investments in supply chain agility and omnichannel are a key part of their turnaround strategy. Investing in supply chain speed and efficiency includes improving forecasting in the hard to forecast fashion industry. But they also seek to improve efficiency by “leveraging data analytics to offer the right product at the right time and the right price.”
Robots with hands that can pick delicate objects would potentially be transformative in distribution if these arms could be attached to mobile robots. But first we have to understand the capabilities of robots with “hands” better. I visited Micron Products to hear about their installation of a robot, really two integrated robots, to automate the […]
The world’s most sustainable company is a supply chain software company – Dassault Systemes. The world’s least? Amazon. Amazon is an incredibly innovative company that has devoted virtually no innovation to improving the sustainability of their supply chain.
BASF does not get credit for having one of the world’s most intelligently constructed supply chains. They should. Core to their design is what they call the “Verbund” concept. This allows the byproducts from one product to be efficiently used as raw materials in the next.
Laser guided vehicles (LGVs) area a flexible automated guided vehicle (AGV) solution. LGVs are a more flexible solution than older forms of AGVs that follows markers or wires in the floor or where navigation is based on following a magnet crumb trail. LGVs can move through a facility on multiple paths and the paths can change as needed. This article explains how a “typical” LGV implementation would take and the steps involved.
313 million dollars has been invested by venture capital companies in developing autonomous mobile robots (AMRs) solutions in the last several years. ARC’s recent global market study on this market shows it to be a very rapidly growing market. An autonomous mobile robot is a vehicle that requires no change to a facilities infrastructure to […]
The CEO of OTTO Motors, a provider of autonomous mobile vehicles (AMRs), has some provacative ideas about what is occurring in the AMR market. Mr. Rendall also pointed out that the automated guided vehicle market in the U.S. has grown to less than $200 million in thirty years. Bolted to ground warehouse automation has its limitations. “There is a pressing need for flexibility.”
Historically, companies looking at a technology solution would put together a detailed business plan, and then only implement the technology if the forecasted financial returns exceeded their return on investment (ROI) target. But more companies are experimenting with next generation robots and other digital technologies, regardless of whether the ROI is there or not. HIROTEC AMERICA, part of the HIROTEC Group, is one such company.
LLamasoft has developed a maturity model related to supply chain design solutions. As a leading supplier of supply chain design solutions, this is a natural extension for them. Developing a maturity model, however, is not for the faint of heart. The model explicity ties ROI from a design project to the maturity level.
Lufthansa Technik Logistik Services began their digital transformation three years ago.. Because about half of this company’s 2017 revenues are related to warehousing services, several of their digital projects have been related to improving efficiency in their warehouses. This case study describes their approach to testing out mobile logistics robots.
12 of the world’s biggest companies, including Walmart and Nestlé, are building a blockchain to remake how the industry tracks food worldwide. The group is focused on solving the traceability problem is known as Food Trust. There are many initiatives using Blockchain. This initiative is further along than any other.
Robots with swarm intelligence. Austrian headquartered Agilox designs and manufactures mobile logistics robots that use “swarm intelligence” to intelligently navigate through warehouses and factories, delivering pallets and totes where they are needed. This article discusses this technology.
A.T. Kearney publishes an annual study on reshoring. Their July 2018 release – their fourth annual “Reshoring Index” – shows record imports from traditional offshoring countries in 2017. “Imports of manufactured goods into the United States from the 14 largest low-cost-country trading partners in Asia rose by a staggering $55 billion, or 8 percent—the largest one-year increase since the economic recovery of 2011. Tariffs and political pressure is unlikely to change things very much in the near term because changing global supply chains is not quick or easy.
Mike Reid, the Chief Operating Officer at Embark Trucks, said that “Anyone employed as a driver today will be able to retire as a driver.” What makes that statement surprising is that Embark is a leading developer of autonomous trucks. One might think that the goal of an autonomous truck company is to render drivers superfluous.
There is terrific payback from supply chain design solutions. At GM, the supply chain design team is an in-house consulting group. Annually, the projects they take on save between 5 to 10 percent of the in scope spend. They have done many projects in the logistics area, some on an ongoing basis. Logistics costs as a percentage of revenue decreased every year from 2013 to 2018. That is a remarkable feat in today’s freight environment. Considering the size of GM’s transportation spend, $6.5 billion, and the length of time they have been at this, it would not surprise me at all if this small team has saved GM over a billion dollars.
Starship Technologies has designed delivery bots that make last mile deliveries. They are not the only company operating in this space, but they are the only company, that has moved beyond the pilot stage to actual commercial operations. To revolutionize last mile deliveries, continuing funding will be needed.
Land O’Lakes Chief Supply Chain Officer, Yone Dewberry, told an audience at eft’s 3PL and Supply Chain Summit in Atlanta in on June 6th, “We’ve created it” (the truck driver shortage). “As an industry” (shippers), “we’ve done this to ourselves.” Land O’ Lakes is a member owned cooperative with revenues of $15 billion. The company […]
Manhattan Associates made significant enhancements to their warehouse solution. They have changed the rules of automation, employed significant forms of optimization not currently used in warehouse management systems (WMS), and greatly improved the ability to fulfill e-commerce orders.
The traditional assembly line moves products from station to station on conveyor lines or overhead cranes.Automatic Guided Vehicles are being used to create a fully flexible factory line. AGVs can be used as a “flexible fabrication platform.”
Autonomous Mobile Robots (AMRs) are seen as smart, automatic guided vehicles (AGVs) as stupid. That is way too simple. AMRs are actually just one form an intelligent AGV can take. And both AGVs and AMRs exhibit a broader range of intelligence than is commonly understood.
Many companies send their employees to leading supply chain conferences. Yet outside the Logistics Service Provider industry, widespread internal training within a supply chain organization remains rare. But that is what Campbell Soup has done, they have put in place an innovative supply chain training program. The Campbell Soup Company is a global food company […]
In 2015, Smithfield Foods, the largest pork producer in the world, got terrible publicity when a spy drone flew over farms operated by one of their subsidiaries and took pictures of lagoons filled with pig feces and urine. Sustainability initiatives provide a way for global brands to improve their brand reputation and reduce risks of […]
Tesla Chief Executive Elon Musk dodged questions from financial analysts about the electric car maker’s condition last week on its earnings conference call. Musk refused to answer questions on Tesla’s capital requirements, saying “boring questions are not cool.” The Business Insider reports that Cowen analyst Jeffrey Osborne dubbed Wednesday’s call, in which Musk talked of “barnacles, flufferbots, […]
Historically, we talked about warehouses as being manual or highly automated. Manual warehouses are more flexible. Highly automated warehouses have much higher throughput, but their lack of flexibility adds risk. Parts Town has an automation solution called AutoStore that increased throughput but will also flex up to support Parts Town’s strong growth.
BASF uses real-time visibility to improve their service capabilities. They implemented a solution from MacroPoint, a Descartes company, to improve their delivery reliability as well as improve the productivity of the transportation providers they use to service the North American market. But implementing great technology is not enough. Getting the most out of software also requires dealing with both internal and partner cultural issues and improving processes. According to Bill Wehrle, the Director of Supply Chain for isocyanates and inorganics in BASF’s Monomers strategic business unit, the journey that BASF has been on to improve their supply chain’s reliability started eight years ago.
When it comes to long haul shipments, drivers are paid mainly based on the distance they travel. Should driver pay instead based on the hours a trip takes to complete? It would be fairer and toady’s technology supports this in a way that was not always true.
Supply chain software companies have been garnering some major investments. Some quiet investments from patient investors are reshaping the industry, These supply chain software companies are benefiting from patient investors. The investors, in turn, are keen on software companies with network solutions. These “digital” companies are seen as having the opportunity to create new types of value for their clients.
I recently attempted to read a white paper from McKinsey that talked about the value a digitization program can provide; the problem was that after reading the article for ten minutes I still had no idea how they defined “digitization.” Sometimes I get fed up with theory. What follows are ten supply chain case studies […]
When it comes to enterprise software, a truism is that the software contains “best practices.” Companies should change their processes to fit the best practices contained within the software. This will lead not just to better efficiency but makes the software easier to implement and upgrade. But as one company’s journey to logistics maturity shows, […]
Software as a Service (SaaS) is a rental model that allows you to purchase enterprise software without paying giant upfront license fees. In theory, this means software becomes an operational expense (OPEX) rather than a capital expense (CAPEX). As software markets shifted from CAPEX to OPEX, we were supposed to see dramatic changes to software […]
Supply chain analysts are far more caustious concerning the maturity of blockchain for business applications that the broader tech community. Perhaps too cautious. One day after analysts appeared on a HighJump panel on this topic, an article appeared in the Wall Street Journal that claimed that 1.1 million items from Walmart are being tracked by blockchain, helping the massive retailer trace these products journey from supplier to store.
When it comes to Warehouse Management Systems (WMS), HighJump is one of the three biggest providers of best of breed solutions. Last week, HighJump held their annual user conference – Elevate – in Dallas. This is always a good chance to get caught up with one of the major players in the supply chain execution […]
Most companies invest in transportation management solutions to cut costs. Home Depot has proven that investing in this can improve service and grow revenues. This article describes the path they took to put this business case together.
Technical issues with blockchain for supply chain applications have been largely eliminated. The technology is being widely tested in pilots and proof of concepts but is not yet in every day usage. Experts predict that 2018 will be the year this changes.
Last Thursday, UPS announced its plans to deploy 50 plug-in electric delivery trucks supplied by the Workhorse Group. What increased UPS’s willingness to invest in these vans is innovative “smart charging” software that has implications for last mile routing. There are other interesting developments in last mile routing as well.
Business students are all exposed to the Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis tool. This last week I came across several interesting stories – or in one case a presentation – that all centered on different aspects of SWOT in the supply chain realm. First, STRENGTHS; Greg Toornman – the Director of Global Materials, […]
The CEO and Chief Innovation Officer of Vecna Robotics, Dan Patt and Daniel Theobold, came in to see us at the ARC Advisory Group. We were already very bullish on the autonomous mobile robotics (AMR) industry’s potential to improve warehousing and order fulfillment, but Vecna has some differentiators that make them a very interesting supplier. […]
The $200 billion system integration industry, which was designed around customization, needs a new business model according to Mark Hurd, the CEO of Oracle. Mr. Hurd exclaimed, “the current model is unsustainable.”
Mike Guilfoyle of ARC has been doing some interesting writing on predictive analytics. One of the terms he uses is the “citizen data scientist.” I like the concept, and will explain Mike’s thinking in this article. But let me provide a little context first. It would be easy for a supply chain executive, or any […]
Plated is using machine learning and artificial intelligence to improve diverse operations across their value chain. These operations include product development, customer engagement, sales, and forecasting.
Demand planning is a good application for machine learning because the measure of success – the forecast accuracy – is clear. To learn, an application needs a clear measure of success. Having a clear measure of success sounds easy. But often, defining success in not easy. Consider a situation where a manufacturer learns of a […]
Machine learning has been successfully applied to demand planning, but leading suppliers of supply chain planning are beginning to work on using machine learning to improve supply planning. But architecturally and culturally, this is a much tougher problem than machine learning applied to demand planning.
There are several key supply chain trends to watch in 2018. Omnichannel Revenue Management The retail supply chain has been going through a massive transformation. Traditional brick and mortar retailers seek to leverage their stores to better compete against Amazon and other ecommerce retailers. ARC’s Chris Cunnane does an annual survey omnichannel retail in conjunction […]
There is an arms race to incorporate artificial intelligence in demand planning solutions. Many new data sources, features, and tools are being explored. A new demand modeling tool has been introduced which will make it easier to analyze new data sources to see if they can be used to improve forecasts.
What was hot in supply chain technology? A look at 3D Printing, robots, autonomous trucks, the use of Social-News-Event-Media data for risk management, and the Uberization of Freight with ARC’s assessment of the maturity of these technologies.
Supply chain planning in the chemical industry is difficult because of the complexities associated with this industry. Optimization depends on models. The models for the chemical industry tend to be much more complex and detailed than in most other industries.
Elon Musk unveiled a prototype of an electric Tesla Truck on November 16th. Over the Thanksgiving holiday the pricing was announced. It’s not pretty. The base price of the 300-mile range Tesla Semi is $150,000, and the 500-mile range model costs $180,000. That’s almost double the base price of a traditional semi truck according to […]
ARC did a survey designed to uncover just what practices contribute to success in running a warehouse. A successful warehouse was defined as a warehouse that is productive, safe, contributes to high customer service, and retains its employees. In looking for best practices, we were looking at what high-performing warehouses were doing that is different from other distribution operations.
Machine learning engines can take data on forecast accuracy and use that data to automatically improve the forecast model. However, three is a rub. Lost sales is a key piece of data on the accuracy of the forecast, but lost sales is generated with a demand forecast. This is circular reasoning. But that does not mean this analysis is without value.
Rail freight is losing market share to faster and more reliable modes. Better technology can be part of the solution.
Artificial intelligence (AI) is hot. Over $4 billion in venture capital has been invested in AI firms just in the US. But supply chain planning software companies, with their cadre of operations research Ph.Ds who have been modeling complex problems for decades, may be better poised to solve many complex business problems than the hot new Silicon Valley firms.
Machine learning has become hot this year. Supply chain software suppliers are investing in improving their software’s capabilities by using machine learning. But machine learning in supply chain software is not new.
Rail is losing market share to faster and more reliable modes. But technologies exist that can improve throughput substantially. Why aren’t the Class 1 railroads investing in it?
Drones have earned a place in the medical supply chain in Africa. But before Rwanda started using drones, careful thought had to be given to when this mode made sense and when it didn’t.
From a cybersecurity perspective, blockchain offers great advantages. The technology is being investigated for a variety of supply chain applications. But there are also challenges.
The Dow Jones Sustainability Index is the best known of the corporate sustainability reports. Almost 2,100 companies data was assessed via a Corporate Sustainability Assessment (CSA). They have released their winners by industry category. Congratulations to the winners!
A global garment manufacturer entered an unusual Lead Logistics Provider relationship with their service provider, they actually allowed the 3PL to integrate into their systems and see who they were selling their products to. This unusual level of trust allowed the 3PL to provide not just warehousing and transportation services, but also robust inventory optimization to their customer. The results were fantastic.
Logistics solutions have long had logic for both improving a shipper’s transportation capabilities and for doing commerce. While these solutions supported commercial transactions related to shipping, these are not true marketplaces. That is changing.
A revolution in robotic automation for the piece picking warehouse is emerging. The combination of mobile robots and picking arms is potentially revolutionary. These solutions are just beginning to emerge. Rochester Drug Coop (RDC) has implemented a solution from IAM Robotics with future phases already planned.
The opportunity to use additive manufacturing to print spare parts is widely recognized. There have been challenges, but those challenges are becoming easier to overcome.
The flood is almost biblical in scale. What could anyone do to prepare for something like that? Quite a lot actually.
Almost four years ago, Jeff Bezos went on 60 Minutes and unveiled his vision of having drones deliver packages right to customers’ door steps. He said we could achieve this in four or five years. We are far from achieving this, but last week the first regularly scheduled drone deliveries in an urban area were announced.
The core idea behind digital agriculture is that a farmer should not uniformly apply seeds, fertilizer and other inputs to their field. The farmer’s smart machinery applies seeds and fertilizer at variable rates based on the soil characteristics – nitrogen levels, organic matter content, moisture, etc. – at different points in the field. This is a digital revolution in agriculture.
AGCO is acclaimed for their approach to supply chain management. Part of their supply chain transformation led to a reduction in freight costs an unheard of 18% while maintaining service levels!
Campbell Soup’s forecast accuracy had gradually deteriorated. The company engaged in advanced benchmarking as part of a holistic strategy to improve our results by strengthening their processes, people, and tools. The result? Forecast accuracy better than the industry average.
I’ve been briefed by several providers of AI platforms. I’m left uneasy by these briefings. It is as if Artificial Intelligence is like a magic wand, wave it and your problems disappear. But Teknowlogi appears to have a practical AI Platform, the first I’ve come across.
Companies with B2B order flows have been slower to understand the important role a distributed order management system can play in increasing customer satisfaction, sales, and helping to insure orders flow to customers in the most profitable way possible.
Robust benchmarking is difficult. It is now possible to do robust benchmarking of the demand management process. That is much harder to do than you might think.
Most of the shows I attend have users speaking about how they use established solutions to reduce supply chain costs or improve service. End users speaking about how they are using evolving technologies to transform their business are rare. The number of stories focused on transformation at Leonardo Live was impressive.
Blended solutions are emerging – part transportation management system, part managed services. This case study explore the benefits one shipper got from this solution.
A lead logistics relationship is a significant commitment. There deals should always be based on several key collaborative principals. The XPO/Nu Skin deal is one of the few deals explicitly based on these “getting to win” concepts.
Jeff McDermott, the Sr. Vice President of Transportation at GEODIS, made the point in a conversation with me that there have been several new entrants providing managed transportation services. “Cloud-based transportation management systems (TMS) have lowered the barriers of entry in this field. But small players don’t have the economies of scale.” By economies of […]
Europeans and North Americans talk about this managed transportation in different ways. In Europe, they often refer to this as a 4PL (fourth party logistics) service. When Europeans talk about a 4PL arrangement, what they are referring to tends to be more tightly defined and less flexible than what North Americans mean by “managed transportation.”
On June 1st, the US withdrew from the Paris Climate deal. Many of the largest companies in the world have embraced sustainability. almost all organizations (97 percent) place a high level of importance on sustainable procurement.
The problem is that initially most companies don’t focus sustainable procurement on greenhouse gas reductions.
Wall Street believes Amazon is winning the retail war with Walmart. Amazon’s market cap is twice that of Walmart, despite being a much smaller and less profitable company than Walmart. Wall Street values the growth of the ecommerce giant over the size and clout of the world’s largest retailer. In the last few years, Walmart […]
Investors believe Amazon is winning the retail war with Walmart. Amazon’s market cap is twice that of Walmart’s. When it comes to retail, Walmart’s most important retail operations (Walmart U.S. and Sam’s Club) are more than four and a half times larger than Amazon’s main retail operations (Amazon North America) and the operating income is […]
At Manhattan Associate’s user conference last week, a series of product enhancements to their Omni-channel capabilities were announced. The most significant was the introduction of a Cloud-based suite.
For 3M, a digital supply chain is about reducing friction, both internally and with partners and customers. And according to their Sr. VP of SCM, “Friction occurs at the connection points.” Digitization provides the information that allows different parties to get to a point where they can more efficiently work with each other.
Several suppliers report they are seeing the shift toward smart device barcode scanning among millennials. These scanners are most appealing to companies that have a large seasonal surge and have a need to bring temp workers – often millennials – up to speed quickly.
JDA is working toward providing off the shelf solutions that allow companies to use SNEW data – social media, news, event, and weather data – to improve their supply chain capabilities. In short, they are working to leverage Internet of Things (IoT) to improve supply chain management.
The best marketing executives have long worked to have an “outside in” view of their products. They want to understand how customers and potential customers think about their offerings. The supply chain profession needs to go much further to get to a similar level of maturity. New CaaS solutions can help.
In 2015 when the largest parcel carriers introduced DIM Weight rules, making smart decisions on parcel shipments got much harder. Saving money on ecommerce shipping requires concurrently optimizing across various carrier services, their DIM rate rules, and clever cartonization. A new solution solves this complex problem.
The Internet of Things (IoT) is all about using sensor data to make better decisions. The use of sensor data to make better decisions is nothing new in warehousing. Warehouse management systems (WMS) have for decades relied on scans from barcode scanners to confirm floor level activities have occurred correctly. In the last ten years, […]
What does it take to do Integrated Business Planning well? Sharp Home Electronics Company of America does it very well and this case study imparts some key lessons.
In an industry pressured by driver shortages, reducing driver turnover can be a source of competitive advantage. A prominent carrier used the SAP HANA analytics solution to significantly lower turnover.
Price optimization could be a powerful tool for demand shaping. It could be used in Integrated Business Planning to help balance supply and demand. It’s rarely used this way. Why?
It may seem strange to write about preparing for the Holiday surge in the Distribution Center so early in the year. But the e-commerce surge can increase order volume by a factor of five or more for some retailers. To prepare for those kinds of volumes, you really need to start now!
Cloud applications go in 50 percent faster. And upgrades are a virtual nonevent. But Safra Catz talked about the many changes Oracle had to make to truly embrace the Cloud.
An American steel manufacturer began its journey toward making their supply chain a competitive weapon in 2010 when they implemented a new Integrated Business Planning (IBP) process. Since then, the company has improved its delivery performance from the low 60s to over 90 percent; their quoted lead times are now the shortest in the industry.
Demand management solutions need to be flexible! Over time, companies often go on a journey where their forecast accuracy is improved by using more and more data and by forecasting at a more granular levels. Demand forecasting applications need to be able to support this journey.
The US National Highway Traffic Safety Administration (NHTSA) proposed new safety regulations that will impact the Autonomous Vehicle market. The chief fear surrounding Autonomous vehicles is that they could cause crashes. The new technology proposed by NHTSA could help reduce many kinds of accidents.
Mark Elter, a Director of Supply Chain at Kerry, describes the journey they have started to do better capacity planning based on implementing a S&OP process. Mark will be the first to tell you, implementing S&OP is not easy.
It is time to start thinking about the supply chain shows you will be attending in 2017. Here is a list of the key supply chain events of 2017.
The idea that a supply chain solution should not be a “black box” solution – a solution that forces planners to blindly trust the output of the optimization engine – has been around for close to twenty years. In transportation, the need for this has been glaringly obvious because of all the parameters that can go into a “solve.”
The problem with trends is that they are like a freight train gaining speed; everyone can see the train, but at what point do you say the train is really moving at speed? With that in mind, here are the trends I’m following and the predictions I am making.
If demand management teaches us anything about learning to leverage the Big Data generated by sensors, it is that leveraging IoT data is likely to be a lengthy maturation process.
Supply chain executives at companies with global supply chains are paying close attention to what happens surrounding import tariffs and trade rules now that Donald Trump is the President elect. On the campaign trail Trump promised to renegotiate the North American Free Trade Agreement and impose punitive damages on goods made in China.
The most dynamic form of routing is focused on e-commerce home deliveries. The importance of routing starts right at the point of purchase on a web site. The choices given to consumers from the routing engine should help to maximize profitability for the retailer.
UPS Invests in a 3D Printing Firm to Learn UPS actively monitors emerging technologies including 3D Printing. 3D Printing, also known as additive manufacturing, was not that interesting to UPS initially. But as industrial manufacturers began making components, not prototypes for R&D, but direct material components used in finished products, UPS began to become interested. […]
Predictive analytics are being employed in interesting new ways to improve safety. Telematics solutions have long monitored events like hard braking and speeding to flag unsafe driver behaviors. But today, this driver event data is being enriched with other data streams to actually predict the likelihood of a specific driver having an accident. Omnitracs’ Critical […]
Many of Amway’s products that are largely sold overseas, actually leverage “Made in America” as a key selling point. This has led to a global network of plants which prioritizes investment in the U.S.
In this Presidential election, trade as a destroyer of jobs has been one of the few issues actually discussed. But automation kills many more jobs than trade. For young grads, based on automation trends, will logistics remain a solid career?
If a marketplace can not provide an almost instant quote, how much value is that site really providing to shippers? But providing instant quotes and commitments is much more difficult for freight moves than what Uber does with their ride hailing service. There are more parties to the transaction and much more complexity. But one tech startup has taken an interesting Big Data approach to tackling this problem.
There has been some breathless coverage of 3D Printing’s impact on the supply chain. In the supply chain realm is has been speculated that additive manufacturing could be able to transform the spare parts supply chain. The idea is that instead of carrying a plethora of slow moving parts across a network of warehouses, these warehouses could just manufacture the parts as needed. In 2014, one expert thought this was being overhyped. Today he is seeing signs of progress.
The Electronic Logging Data (ELD) mandate, Hours of Service (HOS), Federal Motor Carrier Safety Administration’s (FMSCA’s) safety scores; It is clear that owning a truck fleet comes with compliance challenges. The Internet of Things, predictive analytics, new BI platforms; It is also clear the external IT environment presents opportunities. How are new capabilities in IT solutions being leveraged to meet fleet compliance and safety challenges?
There are as many ways to approach corporate social responsibility as there are companies. But a key driver is almost always focusing on the issues that could be most injurious to that company’s brand equity. For large apparel and retail companies, the treatment of labor in sweat shops in third world countries presents a critical set of issues. This article discusses new crowd sourcing apps that could allow brand owners a tool to better protect their reputation.
There has been a lot of discussion about whether the Uber model can transform the freight industry. But the technology startups focused on international shipments – ocean or air – are quicker to embrace comparisons to other large tech platforms like Priceline, Orbitz, or Expedia. Max Lock, the CEO of Fleet Logistics, said we don’t […]
While Amazon has gotten a lot of press surrounding the possibility of using drones to deliver goods to customers, current regulations make that all but impossible. But that does not mean drones are not in use. Some of the biggest application areas for drones include agriculture, mining, land surveying, media and entertainment, and inspecting infrastructure such as roads, bridges, buildings, cell towers, wind turbines, pipelines, and power lines.
As consumers’ preferences shifted toward more nutritious foods, PepsiCo purchased companies in this food segment. But this segment has a much more complex supply chain. PepsiCo had to take a new approach to supply chain resilience.
Air freight is not as competitive as it could or should be. There has been a modal shift; roughly 400,000 tons have been lost to ocean each year since 2000. Part of this is beyond the control of the industry. But it is partly due to the fact that air is just not as fast, seller’s shipping dock to the customer, as it should be.
The U.S. Food & Drug Administration (FDA) is, step by step, implementing new rules based on the Food Safety Modernization Act (FSMA). The goal of these efforts is “to protect foods from farm to table.” The rules fall most heavily on food manufacturers, but they also impact truckers. The deadline for the section of the […]
While robust parcel solutions offer workflow designed to prevent paying too much for a particular shipment, the workflows in the retail multicarrier solutions can be both more extensive and much more interesting. The Descartes Systems Group acquired a company called Oz DEVELOPMENT that is designed for small and medium sized retailers. Ken Wood, the Executive […]
Even though the idea of launching drones from the roofs of delivery vans, is silly; Daimlers new van is impressive nonetheless. The idea of a car maker as a provider of a holistic delivery system that combines the vehicle, material handling hardware and special racking, and enterprise software is a very interesting. That, not drones, is what makes a true step forward in the automotive industry.
McDonald’s announced a 10-year plan to produce cage free eggs. The Fortune article is mainly a turnaround story. But this turnaround depends upon a supply chain transformation.
But before AI does take over the world, can supply chain practitioners use AI and cognitive computing technologies to improve supply chain operations? Don’t hold your breath.
The Uber-style marketplaces were contacted and analyzed for this report. Tech startups, founded with the idea of using Uber style technology to reinvent last mile freight, have raised about $120 million since the beginning of 2015. This is much less than the billion plus dollars invested since the beginning of 2015 into startups promising to deliver retail merchandise, groceries, or restaurant meals within a few hours, or even minutes.
On Friday JDA Software announced that it received $570 million in additional equity funding. This made me think about their product roadmap. In particular, would this change their roadmap for supply chain visibility? I hope if anything it enhances it. Supply chain visibility has become hot, as multinationals again begin to explore supply chain control towers. For JDA, not unexpectedly, much […]
Over $170 million invested since the beginning of 2015 in tech startups with an Uber style model seeking to transform the freight industry. But how well do the venture capitalists investing in these companies really understand logistics?
In my conversations with industry pros, there was a disagreement about whether there was much of any growth in the use of parcel software in most industries. But there was no disagreement that ecommerce and omni-channel initiatives were leading to a double digit growth in sales of multicarrier software to retailers. Ecommerce was also leading to […]
There are interesting insights that can be derived from studying platform companies. I suspect the following insight will resonate with supply chain executives, “The traditional levers of action of controlling centrally what is done within the firm or exerting power over suppliers will not be sufficient, as much of the value is created outside the traditional boundaries of the firm.” In short, effective supply chain managers will increasingly need to become effective curators of network value.
Recently, I’ve talked to several executives at transportation execution software companies. One type of transportation execution solution is called a multicarrier solution. These are also known as parcel solutions. In today’s article I will focus on the functionality and technology associated with these solutions and their ROI. These software solutions allow shippers to rate shop […]
Shell Oil has created a next generation control room (CR) to monitor their deep water offshore production activities in the Americas. Shell Oil has created a control room whose scope of analysis is larger than the typical control room, and one that is also delivering an ROI much greater than is typical. The Shell CR […]
… why did Infor pay so much for GT Nexus? In his keynote, CEO Charles Phillips made the point that “no one wants to be on a network until everyone is.” But the GT Nexus network has traction with $100 billion in spend managed on the platform. “80 percent of the data needed to run a global supply chain,” Mr. Phillips claimed, resides with partners.”
IBM manages more than $30 billion a year as part of its supply chain, with thousands of supply chain managers and analysts worldwide. IBM is using Watson and huge troves of weather and location data – IBM acquired The Weather Company last year – to improve their supply chain risk management program.
…as a supply chain guy, I just love hearing about a business turn around that was largely driven by a more effective supply chain. That, as Tuesday’s financial news proves, was clearly the case with Hostess Brands.
If you wanted to learn how penetrated the WMS market was, how would you go about it? You’d hire a market research firm. But for the market research firm doing the analysis, it can be a devilishly tricky project. Buyers of this type of research need to understand the complexities and limits of this research.
Building unbreachable supply chain applications is virtually impossible. So it was with great interest that I listened to how blockchain technology could be used to create robust tendering and visibility that can be wholly trusted.
When it comes to getting a good price, there are things that one would reasonably suppose would lead a shipper to get better pricing when dealing with carriers. But do they? For example, one might reasonably expect that the way a shipper treats drivers when they arrive on site to pick up or drop off […]
Amazon undoubtedly reaped first mover advantages in e-commerce. In recent years we have seen Amazon make giant investments in logistics assets. Are those investments aimed at making their traditional business more “profitable” or are they designed to turn Amazon into a leading logistics company?
The concept of a network of networks – a network that rides on top of other networks and leverages those other network’s data – has been in existence for a while. ARC prefers the term “supply chain operating network,” which we have been writing about since 2003. While the terms are in use, what has […]
Most supply chain professionals know that a successful project is likely to include elements of people, process, and technology, but few of us really devote the attention to People issues that they really deserve. Manhattan Associates’ Momentum conference was refreshing because they did not ignore this critical element of project success.
Over 9 million twenty-foot equivalent units (TEUs) are transported through the port every year, and this is forecast to double by 2025. But the Hamburg Port is located in an urban area and they cannot increase the size of the port to handle increased traffic. To handle shipments efficiently, the HPA must operate smarter. To help with this, this Port has undertaken one of the most impressive IoT projects this writer has seen.
This logistics services company manages hundreds of millions of supply chain assets for its clients, has hundreds of thousands drop off and pick up points, and make over 10,000 deliveries per day moving through over 100 logistics centers. To manage this complexity in a manner that insures high service levels, a sustainable/green supply chain, and profitability, the company has committed itself to a variety of analytic solutions.
The tsunami of 2011, which triggered the meltdown at the Fukushima Daiichi Nuclear Power Plant, was a wakeup call for General Motors (GM). GM learned that their business continuity plans at the plants were too “tactical.” Supply chain risk management has become a hot topic in recent years. It was also a topic of discussion […]
Multinational companies can have thousands of Tier 1 suppliers, and in the extended multi-tier supply chain it could be hundreds to thousands of upstream suppliers. How can companies insure that companies they source from are not engaged in slave labor?
Supply chain operating networks are finally beginning to emerge. They will change what supply chain software platforms look like in a few years. In particular, innovative new approaches to supply chain risk management have emerged.
When it comes to bulk shipments of commodities, strategic planning is even more important than day to day operations. Without careful advance planning, logistics personnel can never hope to effectively manage logistics operations when they are stuck with a suboptimal supply chain network.
Uber has disrupted the taxi industry. Can anyone copy the Uber model and disrupt the freight market? That question is generating a great deal of discussion among logistics executives with the “last mile” freight market generating the most buzz. Transporting goods long distances can be done far more cost efficiently than the delivery of the […]
In ARC‘s recent Supply Chain Visibility & Collaboration Study, we found that the supply chain visibility & collaboration market is the fastest growing supply chain market. Over a year ago, ARC started to come across large corporations investing in supply chain control towers as a way of taking their supply chain program to the next level. We […]
Outsourcing is very common in supply chain management. But one thing very few companies outsource is demand management. In fact, until I talked to Lori Pouquette, the vice president of global customer operations at Xilinx, I had never heard of a company outsourcing demand management processes.
The Logistics Services Provider (LSP) is notorious for its high employee turnover. Does this matter? A leading LSP believes if you want happy customers you need happy employees.
Large companies have the benefit of volume and can often ship full truckload. For small and medium-sized companies to compete on price and service, consolidation programs can be a key mechanism for leveling the playing field. I talked to Chip Nolin, the Director of Logistics at Seventh Generation, about a new transportation consolidation network they […]
The most important reason to go with a cloud solution is that is has a better total cost of ownership (TCO). These savings are driven by faster implementations, easier upgrades, better system longevity, and lower IT costs. Traditionally these advantages applied to public clouds, increasingly they now apply to private cloud solutions as well.
…these kinds of reports help supply chain and operations professionals understand what may be required of them in the not so distant future. So for example, a vice president of procurement can look at this chart and realize that while their company is only screening business partners on ethics and sustainability issues to a very limited extent, there is a good chance that in a few years his company will require his department to do so much more extensively because this is where this industry is headed.
In logistics, we have not seen all that many examples of Big Data analytics. But it is clear we will see many more solutions in the not so distant future.
A rich stream of data has long been available to improve ocean visibility. AIS is an automatic tracking system used on ships. But CargoSmart is doing something new – they are using this near real time data to improve vessel scheduling and shipment tracking.
Dell has a complex supply chain. And, this complexity has, over time, had a corrosive effect on Dell’s order fulfillment performance. In Dell’s case, when they dug into this by talking to customers, what they heard over and over was “I want you to build, ship, and deliver what I ordered, when you said you would.”
Demand for grass-fed beef has grown at an annual rate of 25-30 percent for the past decade at the same time that per capita beef consumption for traditional beef products continues to decline. A recent study determined that grass-fed beef demand in several major US metropolitan markets is 3 to 6 percent of the total […]
I’ve made the argument before that the Internet of Things is nothing new. In the logistics space, for example, we’ve been taking RF scans and using that data to improve warehouse processes since at least 1975 when McHugh Freeman, an early warehouse management system supplier, began business. Internet protocols make it easier to communicate that sensor […]
Last year, Ben & Jerry’s celebrated a milestone: all the plant-based ingredients in their ice cream, yogurt, and sorbet products transitioned to non-genetically modified (non-GMO) sources. Now, they’re working with dozens of other food companies to build up non-GMO commodity supply chains across the country to support this growing sector of the food industry. According […]
Hostess went bankrupt. But Hostess products are back in stores. This happened after the brands and certain factories were purchased out of bankruptcy in April of 2013. The brand was then relaunched in July of 2013. That left just a few months to build a unique, new supply chain from scratch.
Machine learning is helping support more efficient supply chains. Machine learning is being discussed more often in supply chain contexts because of the buzz created by the Internet of Things (IoT). This article gives an interesting supply chain use case for machine learning, and defines and explains the technology.
We are entering an era where it is becoming possible to detect supply chain risks much more quickly. A case in point is offered by AGCO. AGCO is a global leader in the design, manufacture and distribution of a wide range of agricultural equipment. In a discussion with AGCO’s Jan Theissen, Director of Strategy and […]
IoT projects often become Big Data projects. Distributing more intelligence down to the device level could help prevent database bloat and streamline the corporate application environment. But these decisions are not clear cut. There are pros and cons associated with either distributing or centralizing both IoT intelligence and data.
At the beginning of the year the ARC supply chain team made supply chain predictions for 2015. This article circles back and reports on how we did. Very often any predictions you can make for a one year period are not about a brand new thing that will occur, the prediction is really part of […]
We have a new generation of transportation management systems (TMS) based upon more powerful in-memory technologies. What this has created are more advanced transportation simulation capabilities. The way this works is that a user would have dual instances of the TMS. They would have an operational TMS that continues to plan, manage, and execute transportation […]
Sustainable logistics is like a tsunami that is building far out at sea. Right now, the impact of sustainability on the lives of most logisticians is nonexistent. But eventually that tidal wave reaches the coast and things are never the same. In an analysis completed last June by the Governance & Accountability Institute, seventy two […]
Here is a sample question for prospective supply chain, business, or financial analysts, “how many piano tuners are there in Chicago?” This question comes from the business best seller Superforecasting: The Art and Science of Prediction. Before I give you the “answer” to the question, let me tell you a bit about this book’s genesis. While […]
There have been a number of acquisitions involving 3PLs that offer managed transportation services (MTS) solutions over the last year. Cumulatively, these acquisitions involve companies that have over 40 percent of the total MTS market.
Mark Hurd, the CEO of Oracle, made some bold predictions for where the enterprise market is going. Prediction 1: 80% of all applications will run in the Cloud by 2025. Today, he said, 24 percent of enterprise applications are in the cloud. Prediction 2: By 2025, Two Suite providers will have 80% of the SaaS […]
Last year the ARC Advisory Group did a study on the ROI a shipper would get by having their transportation managed by a third party logistics firm. In a managed transportation services (MTS) arrangement, a shipper contracts with a third party to plan and execute the shipper’s moves. Survey results indicate that MTS relationships are […]
McDonald’s is the first to admit things are not going as well as the company would like. In its annual report released in March, CEO Steve Easterbrook owned up to the $18 billion fast food retailer’s disappointing performance – sales up only 1 percent with an operating income decline of 8 percent. To right the corporation, the company […]
But by far the biggest change in “how” goods will ship in the next ten years is based on the continuing development of autonomous trucks.
… innovating at scale at CSCMP’s annual conference last week. For Amazon this means innovating like a start-up but being able to bring to bear the scale and resources of a big company to support the kind of rapid innovation typical of startups.
Over the last ten years, supply chain risk management has certainly grown in importance. And it continues to grow in importance. Research (Travelers Business Risk Index) shows that in 2014, 22% of manufacturers surveyed reported they did not worry about supply chain issues; in 2015, only 9% reported this. The 2015 results are based on […]
The truth, as anyone who deals with ocean freight on a regular basis realizes, is that sailing schedules change all the time. For example, CargoSmart data shows that in May of 2015 there were 5,689,979 schedule changes, 608,112 service changes (where for example, a ship line changes the itinerary by adding a port or switches the order in which particular ports will be served), and 234,414 schedule delays.
I’ve been researching and writing about supply chain management for 20 years. I’ve seen a number of supply chain “revolutions”. In the first revolution, the concept of supply chain, as opposed to logistics, was put forth. Constraint based optimization tools for the extended supply chain were developed to support the new philosophy. As this was […]
At this point, experts are not saying that China has slipped into recession. But recessions are defined in the rear-view mirror, after they have already occurred. Further clouding the issue is the fact that leading economists have long questioned how accurate China’s GDP data really is. Companies would be well advised to start doing contingency […]
When a company is looking to reduce their freight spend, while maintaining or improving service levels, there are two main paths they can take. They can buy and implement a transportation management system (TMS). Or they can outsource transportation planning and execution to a 3PL that provides managed transportation services (MTS). I talked to Wietse […]
I talked to Brent Wilson, SVP of Global Supply Chain Operations at ON Semiconductor, about their supply chain risk management program. ON Semiconductor is a premier supplier of energy efficient innovations in the semiconductor industry. The public company, headquartered in Phoenix, has a truly global supply chain with over 90 locations globally. Brent believes their […]
I had a conversation on sustainable product development with Eric Leafquist, a product manager at Dassault-Systemes-SolidWorks. SolidWorks is a leading supplier of 3D design software tools that let you create, simulate, publish, and manage your data. Driven partly by the Global Reporting Initiative (GRI), the leading reporting format used in sustainability reporting, companies are beginning […]
When a shipper decides they need to significantly lower their freight spend while maintaining or improving on time deliveries, there are two main paths forward. They can implement a transportation management system (TMS). Or the shipper outsource transportation planning and execution to a 3PL; This is a managed transportation services (MTS) engagement. A 3PL white […]
Supply chain professionals have said for years that integrated planning and execution is the Holy Grail for market responsiveness and operational efficiency. But often they think of this as integrating demand planning with supply chain execution. However, additional and more immediate benefits can be achieved by integrating transportation planning with warehouse management. This allows both […]
When pundits discuss the Internet of Things (IoT), they often end up talking about the importance of Big Data analytics. Sensors generate tremendous volumes of data. How will all this data be analyzed? But when I look at the different sensor based systems generating data in a warehouse, I’m beginning to think the bigger challenge […]
Procter & Gamble (P&G) has one of the best supply chains in the world. But when their top supply chain executives talk about supply chain management, it can be hard to understand what they are talking about. P&G has rather forgone talking about supply chain systems and instead talks about their investments in analytics. They […]
When two companies merge, the supply chain organizations also must merge. That means downsizing that department, making personnel choices, converging IT systems, and meeting the supply chain synergies promised to Wall Street. Mergers can go badly wrong, or they can be a new source of competitive advantage. Larry Hartley, the Senior Vice President of Supply […]
The year is half over. The most popular columns published by ARC Analysts so far this year include: Best Supply Chain Conferences to Attend in 2015 5 Supply Chain Predictions for 2015 E-Commerce Growth Brings Last Mile Headaches Amazon, Google, and Crowdsourcing: The Battle for the Last Mile The Key Attributes of Supply Chain Leadership […]
Kehat Shahar, the Vice President of Supply Chain Planning at SanDisk, spoke on the journey that SanDisk has taken to improve their supply chain operations at the eft conference on June 18th in Chicago. While most of the content for this article came from the speech at eft, some information came from the company’s 10-K, […]
Kevin X. Jones, the Vice President of Inbound Transportation at Walmart, and Sheila Taylor, the Vice President of Logistics at Sam’s Club, discussed Walmart’s approach to omni-channel logistics at the eft (eyefortransport) conference last week. Walmart’s ultimate goal is to understand their customers’ expectations, and yet be able to meet these expectations in a profitable […]
In the last few weeks I’ve had the opportunity to speak to two of the three large shippers that were SmartWay Excellence awardees. I spoke to Ron Guzzi the Senior Manager of Transportation Carrier Relations and Sourcing at Home Depot. I also spoke to Blair Chikasuye, the Global Logistics Environment Manager at Hewlett-Packard (HP), about […]
Corporate social responsibility (CSR) reports reflect the philosophy that corporations have a variety of stakeholders – investors, employees, suppliers, customers, and the broader society – and that to attempt to meet the needs of some stakeholders at the expense of others can be both irresponsible and financially short sighted. I’ve been reading the sustainability reports […]
The Descartes Systems Group had their user conference – Descartes Evolution 2015 – this week in Miami. There were about 400 in attendance. The best presentation I saw at the event was given by two executives from Sears. Sears is a North American department store and general merchandise retailer with over $30 billion in revenues. […]
Companies interested in exploring whether the Internet of Things (IoT) is a worthwhile investment have three different paths they can go down. The Internet of Things connects intelligent physical entities – such as sensors, devices, machines, assets, and products – to each other, to Internet services, and to applications. IoT represents a stack of technologies […]
Jenni Stamps and Melanie Payne, the Domestic and International Pricing Managers respectively at the Kimberly-Clark Corporation (KCC), spoke at this year’s JDA Focus. Kimberly-Clark, the $21 billion consumer goods company with brands like Huggies and Kleenex, is a major user of JDA’s TMS solution. The company is also one of the larger shippers in North […]
In North America, the Internet of Things (IoT) is getting a great deal of attention. In one definition of the term “Internet of Things,” almost all objects have sensors, connectivity to a broader environment, and intelligence. Sometimes the object has just a sliver of intelligence; but it can be much more substantial. Objects can be […]
QAD is far better known for their manufacturing than supply chain solutions. QAD provides full-featured manufacturing enterprise resource planning (ERP) software, on premise or via the cloud, with very deep functionality for the Automotive, Food & Beverage/Consumer Goods, High Tech, Industrial, and Life Sciences industries. But when I attended QAD Explore last week (May 4th […]
Stephen Zujkowski, the VP of Supply Chain Management and IT at Brambles CHEP, spoke at JDA’s Focus 2015 event last week. CHEP is the leading provider of pallet, container, and crate pooling services for many of the world’s largest supply chains. In other words, CHEP makes sure companies have the pallets they need when they […]
There are various lists that include the world’s most sustainable companies: Corporate Knights, the Climate Performance Leadership Index, and others. Walmart does not make those lists. None of them. Walmart is doing more in sustainability, particularly in the supply chain area, than they are given credit for. In contrast, there seems to be some sort […]
The Carbon Disclosure Project puts out an A List of top performers every year. Their 2014 report lists 190 companies. I took a look at the 21 companies listed in the Consumer Staples category, a mix of food & beverage and retail corporations. I was curious how many of these companies were using a transportation […]
When it comes to procurement, a supplier that is socially responsible often has only a small advantage over other competitors. The fact that they are socially responsible, or minority owned, often only helps them if they are ranked very closely with the other leading competitor; if two potential suppliers have similar capabilities, the tie breaker […]
There is a rarely litigated – but often irritating – antitrust and distribution law known as the Robinson-Patman Act. The Act prohibits sellers from setting different prices for competing purchasers of like commodities, except when justified based on differences in volumes or cost of sale. In short, if a large supplier is selling the same […]
A perfect order is an order that arrives at a customer’s site on time, complete and undamaged, and is billed correctly. From a logistics perspective, we know that by getting the order there on time, in full, and undamaged the chance that it will billed correctly greatly increases. Doing the logistics pieces right also means […]
Six years ago, Del Papa Distributing, a third generation family-owned beer distribution company that delivers more than 10 million cases of beer annually, decided that Galveston, Texas was not the ideal location for their operations. Galveston seems to be unusually prone to hurricane damage. The 1900 Galveston hurricane was famous for the devastation it wrought. […]
It has long been possible to build a geofence and detect when an inbound carrier was 20 miles out from a warehouse. But warehouse managers, and transportation planners are busy. What good would those notifications do? These managers and planners don’t have time to look at every carrier notification and examine whether that truck will […]
I’ve completed a survey on what factors are most important when it comes to improving warehouse performance. Are people, process or technology drivers most important? An executive overview will be published in DC Velocity in May. I will speak on what 3PLs report being most important for them to improve warehouse performance at eft’s 3PL […]
Last Thursday, I was a participant in an interesting Webinar put on by eft (eyefortransport). For my part, I was just providing a short preview of the results I’m starting to see from my survey surrounding the best ways to improve warehouse performance. I’ll be presenting these results at eft’s 3PL Summit, June 16th through […]
I spoke to Tom Doherty, Senior Director Global Supply Chain at Welch Allyn, about the process they used to select a third party logistics (3PL) partner for European distribution. Welch Allyn, a private company headquartered in Skaneateles Falls New York in the USA, is a leading global manufacturer of medical diagnostic equipment. The company has […]
I’ve recently completed a survey titled Warehouse Performance Improvement. I had two key partners, DC Velocity and eft (eyefortransport). An executive summary of the overall results will be published in DC Velocity in May. DC Velocity’s summary will mostly focus on what shippers can do to improve performance. I’ve just started the analysis, but in […]
I had the opportunity to speak to Miguel Ramirez, Logistics Cost Implementation Lead, from Sisamex at the Oracle Value Chain Summit. Sisamex has had an interesting journey with the Oracle Transportation Management (OTM) solution. Sisamex, headquartered in Mexico, is a joint venture between Meritor, a Tier 1 supplier of automotive components, and Grupo Quimmco, a Mexican industrial […]
Logistics Viewpoints’ owner is ARC Advisory Group. ARC’s 19th Annual Industry Forum ended last Thursday February 12th. Key themes were the Industrial Internet of Things (IIoT) and cybersecurity. These are interrelated themes because cybersecurity tops the list when it comes to challenges for IIoT. When one thinks of a hacker getting into a system and shutting […]
In his 2016 budget plan, to be unveiled today, President Obama will propose that U.S. companies’ overseas profits be taxed to fund a major boost in infrastructure spending. These tax proposals could change the way the Tax Efficient Supply Chain (TESC) operates. When highly profitable companies pay little in the way of taxes, negative press […]
I spoke to a Senior Supply Chain Director at a medical device company about the process they used to select a third party logistics (3PL) partner for European distribution. At this shipper’s European distribution center (DC) goods, mainly in the form of ocean containers that originate from two North American plants, are received and stored. […]
Why should a supply chain executive care about Bitcoin, a platform for processing financial transactions? Increasingly, large firms have executives with titles like “Procure to Pay Process Owner” or “VP of Order to Cash Processes.” Similarly, the large ERP companies are increasingly thinking in terms of these kinds of holistic processes when they add functionality […]
I talked to two executives from Americold – Kevin Van Belle, the VP of IT Applications, and Daniel Cooke, the Director of Marketing – on the topic of selecting a 3PL with robust IT capabilities. Americold is a global leader in temperature-controlled warehousing. I gave these two gentlemen a stiff challenge; I told them I […]
There was an interesting article in Bloomberg Businessweek about a .com startup determined to take on Amazon. Usually, that kind of statement is the standard marketing bombast that means nothing. But in this case, the company – Jet – was started by Marc Lore, the founder and former CEO of Diapers.com. Diapers.com was sold to […]
When a shipper is involved in selecting a 3PL, both parties often consider whether there is a business fit between them, however often times they minimize, or simply disregard the issue of a cultural fit. In short, how well will the 3PL and the shipper be able to work together based upon their respective internal […]
Very often any predictions you can make for a one year period are not about a brand new thing that will occur, the prediction is really part of a larger megatrend that has not only been going on for some time but will also continue for many years to come. Some of the megatrends affecting […]
Let us look at a few critical projects many supply chain leaders would like to initiate to save money and improve service, but can’t, because they can’t muster the necessary corporate support. SKU Reduction – Stock keeping unit (SKU) proliferation generates costs in terms of manufacturing changeovers, warehouse capacity issues, procurement, product design and even […]
I talked to Bob Arndt, the Vice President of Lean Supply Chain Solutions at Ryder. Ryder is a leading 3PL. I talked to Bob about Ryder’s use of Lean programs to continuously improve warehousing operations. Bob Arndt, VP of Lean Supply Chain Solutions, Ryder Many potential customers want to make sure that a 3PL has […]
What resolutions should you make in the New Year to improve your supply chain? Here are mine: To remember that supply chains should be built backward from the customer. One way to do this is to use a Perfect Order metric as a key way of measuring the supply chain organization. But the question remains […]
Over a decade ago, trade journals were talking about smart grocery carts. These grocery carts would have a computer attached to it that could assist consumers in shopping by providing coupons, the location of an item the shopper wants to buy, and even an accelerated check out process if the shopper scanned the items into […]
I spoke to Carl Fowler, the Vice President of North American Sales and Engineering at Menlo Logistics, on the topic of continuous improvement and procuring warehousing services. Carl Fowler The question I had in mind was this, suppose you know that your warehousing operations were not what they should be and you wanted a 3PL […]
If you are looking for a 3PL to manage your warehousing, I believe you should be looking for a 3PL committed to continuous improvement. Your partner should be looking for ways to improve not just your warehouse operations, but your overall supply chain, including how you manufacture and deliver products to your customers. But how […]
Logistics in Africa is tough. Africa just does not have the infrastructure, has an education gap, and does not widely deploy technologies like GPS tracking that are common in the West. But add to that the Ebola plague, insurgent groups like Boku Haram, corruption, and instable government regimes, and you have what appears to be […]
When companies make the decision to outsource warehousing to a third party logistics company (3PL) because they are not happy with their own capabilities, they tend to demand more of the 3PL then they would demand of themselves. I talked to an IT executive at a well-known 3PL active in providing warehousing services about this. […]
The U.S. Energy Information Administration forecast on Wednesday that diesel fuel prices, which averaged $3.92/gal in 2013, are projected to fall to an average of $3.82/gal in 2014 and $3.38/gal in 2015. Unlike most commodities, transportation contracts often have built-in fuel cost indexing, called fuel surcharges, to cover increases and decreases in fuel costs. Those […]
Google was in the news today. Google has signed a 60-year lease for part of a historic Navy air base, where it plans to renovate three massive hangars and use them for projects involving robotics as well as aviation and space exploration. Starting in 2013, Google acquired several companies that produce robots or supporting technologies […]
The perfect order metric (POM) is one of the most critical metrics in fulfillment. The Warehouse Education and Research Council’s (WERC) definition of the perfect order metric is that a perfect order is delivered: Complete; On time; Damage free; And, with the correct documentation and invoicing. This is tough to achieve a very high POM […]
I’d been interacting with Mark Kuta, who works for Oracle in the Value Chain Planning group, and he sent me a book he wrote called Think Like a CEO. The book seems to be directed at sales people; the subtitle is “Sell to Any Company in Any Industry… Better and Faster than a Harvard MBA.” […]
In last Thursday’s Wall Street Journal there was a front page article titled U.S. Boom Can Stand Further Fall in Oil Prices. “Oil prices would need to fall at least another $20 a barrel to choke off the U.S. energy boom, industry experts say, though some smaller American producers would face serious problems from a […]
When companies decide that their present warehousing operations are not what they should be, and that they need to either implement a warehouse management system (WMS) or outsource their warehousing operations to a 3PL, they need to work toward putting together a request for proposal (RFP). If that pre-work for putting together a RFP includes […]
You’ve been offered an interview for a supply chain position, and you need to prepare for it. What next? Research the Company – Before you ever go on an interview, you must first research the company and be fully prepared to answer the questions “What do you know about our company?” or “Why do you […]
The health care industry in the US is undergoing transformation driven by the Affordable Care Act (Obamacare) and the increasing impact of consumerism. Healthcare providers historically have had prepaid plans where the cost of care was paid up front and the more procedures a hospital did, the more they got paid. Consequently providers felt little […]
US LBM is a privately held collection of 13 leading building materials distributors, serving in 11 States with more than 70 locations. The company has grown by acquiring regional distributors as well as through organic growth. The regional distributors have a great deal of autonomy and retain their own names. So, for example, in the […]
Google owns search. Except in one area, product searches. When it comes to product searches many prospective consumers start by going to the Amazon web site. Google is trying to do to Amazon, what Amazon has done to traditional bricks and mortar retailers, crush them. In the last quarter, Amazon’s sales rose 23 percent; yet […]
I’m an ex-academic, but I’m not a fan of most of the research produced by supply chain or industrial engineering departments. Most of it is just not relevant to supply chain professionals. But there is an article that MIT published called Analysis of Truckload Prices and Rejection Rates that was an exception. The researcher, Yoo […]
MercuryGate’s User Conference 2014 was in New Orleans last week. MercuryGate, of course, is a best of breed provider of transportation management systems (TMS). At a conference sponsored by a TMS supplier, you would expect much of the talk to center on the freight savings that can be achieved with a TMS; and this was […]
I’ve been doing some research on the unconventional oil supply chain. Unconventional oil includes crude oil from shale and oil sands. I’ve talked to over 20 oil executives and experts about the inbound supply chain that supports oil well production. This is part of the supply chain that the oil industry refers to as “upstream.” […]
ARC was briefed by Mike Mulqueen of Manhattan Associates on their transportation management (TMS) product. Mike is a Senior Director for Product Management at Manhattan. What I found most interesting was a short conversation we had about the carrier capacity crunch and the role various supply chain software solutions can play in improving matters for […]
About 400,000 carloads of crude oil traveled by rail last year to the nation’s refineries, up from 9,500 in 2008, according to the Association of American Railroads. A series of recent accidents — including one in Quebec last July that killed 47 people and another in Alabama last November — has put pressure on regulators […]
The hottest trend in supply chain management is omni-channel. Five years ago it was shelf-level collaboration. But really, these initiatives should be seen as mutually reinforcing. Omni-channel is retailing is based on providing consumers with a better shopping experience by leveraging both stores and the e-commerce channel. The idea is that a customer should be […]
I’ve had recent conversations with part of the ARC Advisory Group Oil & Gas team – Dave Lafferty, Paul Steinitz, Tim Shea, and Mark Sen Gupta – on the upstream “fracking” or shale oil supply chain. Fracking includes getting oil and natural gas out of shale by fracturing (“fracking”) the shale rock. In the industry, oil wells […]
When Shakespeare used the phrase, “The worm has turned,” he knew his audience would understand that he meant a reversal of fortune. “Worm” was a term for ‘dragon.’ In fairy tales, the flying dragon spewing fire would ravage fields and villages. To be in the dragon’s path resulted in destruction. In shipper/carrier relationships, too many […]
Lauren Howard, Vice President of Customer Service at Celadon Trucking Services, spoke at Manhattan Associates’ Momentum conference in May. Celadon Trucking is one of the 20 largest truckload carriers in North America. They are headquartered in Indianapolis in the US and they offer a range of dry van truckload transportation services including long-haul, regional, local […]
The weather is balmy, and many of us are thinking about the beach or the lakes. But, from a planning perspective, the holiday season isn’t that far away. With the holidays comes an increase in commercial activity, and it’s not too soon to think about effective ways to handle the increase in fulfillment volume. During […]
One of our clients, a third parth logistics (3PL) company, will buy a transportation management system (TMS). They asked us what they should look for in the product demonstrations. After talking to some folks I respect in the industry, this is what I came up with: In the demo, 3PLs should look for the following: The ability […]
The Internet of Things (IoT) will make our operations more efficient by combining smart sensors, cameras, software, databases/business intelligence, and the Internet (primarily in the form of private clouds) together in diverse ways. IoT is already evident in several places across the supply chain, but pundits are predicting that it will become so deeply part […]
When it comes to e-commerce, Westerners are very familiar with Amazon.com. Alibaba, the Chinese e-commerce giant, is largely unknown. Amazon’s revenues of $74.4 billion dwarf Alibaba’s $8.4 billion. But Alibaba has a different business model. Unlike Amazon they do not take ownership of inventory, stock it in their distribution centers, and then fulfill the orders. […]
The Chinese e-commerce behemoth Alibaba Group Holding Ltd. released fresh insights a couple of weeks ago on its logistics capabilities ahead of what’s expected to be one of the largest tech IPOs in history. In an updated security filing, Alibaba included additional details, including new insights on its approach to logistics, that were missing in […]
A week and a half ago I attended and spoke at the North American 3PL Summit and Chief Supply Chain Officer Forum in Chicago. Procter & Gamble’s Julio Nemeth, SVP of Product Supply, also spoke. He spoke about P&G’s supply chain initiatives. He had some interesting things to say: They are now using demand sensing data […]
ARC recently hired Bob Gill, who lives in Singapore, as our General Manager for Southeast Asia. Bob is a former editor of Logistics Insight Asia. For today’s column, I thought I’d tap some of that experience by interviewing Bob. Steve: Bob what is hot in logistics in Southeast Asia? Bob: Well, one thing I’ve been […]
Last Tuesday, I experienced a work disruption – our IT network was down. So I picked up John Manners-Bell’s new book on Supply Chain Risk. One section that I found interesting was on the overlap of the Swiss Cheese Model, which had been developed by academics studying risk analysis, and supply chain management. The key […]
In the news last week, it was announced that “Google plans to build and launch onto city streets a small fleet of subcompact cars that can operate without a person at the wheel.” The electric powered cars with a range of about 100 miles wouldn’t even have a steering wheel, or gas and brake pedals. […]
I interviewed Harry Forbes about the prospects for solar energy being applied to warehouses. Harry is a colleague at the ARC Advisory Group and is our expert on electric power, renewable energy, and energy management. Banker: Harry, I was surprised to read that prices of solar energy are falling exponentially. The impact of exponential growth in the power of integrated circuits […]
Last Tuesday it was announced that the CEO of JDA had been replaced with an interim CEO. Perhaps because I tend to be product focused, I find the most significant recent announcement the news that JDA had productized a Flowcasting solution. Previously, RedPrairie, a firm acquired by JDA, had a joint partnership to provide consulting […]
About 1,000 of Manhattan’s customers and partners attended Manhattan Associates’ Momentum conference in Hollywood, Florida this week. Manhattan is an ARC Advisory Group client. The conference is aptly named. Manhattan is on a roll – revenues are up 10 percent year over year; 35 percent of software revenues come from brand new customers; and despite […]
I was talking to CEO of a 3PL that provides co-managed transportation and other logistics services. The CEO mentioned that they have more than a billion dollars in freight under management. And that is where I asked a somewhat rude question: “What does it matter how much freight is under management? When 3PLs talk about […]
Jeremy Rifkin recently published a book called The Zero Marginal Cost Society. As an industry analyst it is my job to stay on top of technologies that have the chance to transform industry. Indeed, when MHI went through a very throrough research project to identify megatrends that will reshape industry through 2025, all the trends […]
Tom Moroney, the Deepwater Technology Deployment Manager at Shell Oil, gave a presentation on Shell Oil’s approach to control towers, Big Data, and analytics at ARC’s Forum in February. They don’t call it a “control tower” – for Shell it is an “Integrated Operational Center.” And it is not a supply chain control tower – […]
SAP’s SAPinsider supply chain conference was held a week and a half ago in Las Vegas. At this conference SAP announced a new product that will be a critical part of their supply chain solution stack – a Supply Chain Control Tower. Several of ARC’s supply chain software supplier clients have discussed with ARC how […]
A few months ago, ITWorld had an article where they reported that in the wake of the Edward Snowden revelations many U.S. hosting companies and cloud providers are now facing pressure from international customers to have data cordoned off of the U.S. infrastructure. In a conversation with a provider of public cloud supply chain solutions […]
ARC is kicking off a study on managed transportation services (MTS). One of the key questions we have is how is the value proposition of the logistics service provider (LSP) affected by their business model? For example, some LSPs are freight brokers. Would LSPs that provide both MTS and brokerage provide a better or worse […]
Following the Christmas holiday debacle in delivering packages in a timely manner to customers, it was apparent that Amazon needed to make changes. Amazon Prime was a contributor to the mess, and the fees for Prime have been raised which may help damp down the last minute rush during the next holiday season. A very […]
IBS’s America’s user conference took place last week in Scottsdale, Arizona. I was invited to give a speech and while there I attended many of the sessions. I must admit, I did not know IBS particularly well. My impression was that they were a relatively small Scandinavian headquartered enterprise resource planning (ERP) software supplier with […]
Traditionally, we said that warehouses were operated in either a manual, semi-automated, or highly automated fashion. In a manual warehouse, pickers used carts, forklifts and other “dumb” forms of carriage to go to picking locations, gather the inventory, and deliver those goods to the shipping dock. However, forklifts are becoming intelligent. With the right kind […]
Guy DeFlorio, the CIO at Mutual Materials, recently spoke at the Oracle Value Chain Summit 2014 about how his company implemented a Transportation Management System (TMS) from Oracle and were able to simultaneously optimize both the private fleet and for hire carriage moves. Mutual Materials is a leading manufacturer and distributor of masonry products in […]
After Amazon reported its year end revenues, their stock tumbled despite comparable quarter revenue growth of 20 percent. The company did end the year with a narrow profit, something they did not accomplish last year, but investors have tired of the promise of future profits. Profits would have been bigger except for widespread failures to […]
When a shipper decides they need to significantly lower their freight spend while maintaining or improving on time deliveries, there are two main paths forward. They can implement a transportation management system (TMS); or outsource transportation planning and execution to a logistics service provider (LSP). Over the years, ARC has done a number of studies […]
When a shipper is looking to purchase a transportation management system, one feature that can have a very robust ROI is the ability to optimize shipments of the private fleet and the for hire fleet at the same time. In other words, a shipper can maximize freight savings by using company owned trucks where they […]
Gary Forger at MHI made me one of a number of expert reviewers of a recently released document they call “Material Handling & Logistics U.S. Roadmap.” This document is focused on longer term predictions; it “projects out to 2025 how the industry will need to adapt its technology, practices, and workforce to keep pace with […]
There has been a good deal of breathless coverage about Amazon creating a patent that will allow them to ship packages “before you’ve even realized you want them.” This sounds crazy. And it would be if it was what Amazon was likely to really put into practice. If you go to the patent, the process […]
For years, warehouse management system (WMS) suppliers have been introducing “template” solutions. These template solutions are either industry specific or are based upon getting a simpler warehousing solution up quickly. A best of breed WMS offers all sorts of configuration choices. The idea behind the template is that many of these configuration choices are predesignated […]
This is the time of year analysts and pundits make predictions for the following year. So here are my top five predictions. Growth of Natural Gas Fleets – Despite some of the real hurdles associated with running natural gas fleets, the growth of these fleets is inevitable. There is good ROI, if the routes are […]
There is no shortage of supply chain and logistics conferences. If you can attend just one, the most important one is CSCMP. The Council of Supply Chain Management Professionals (CSCMP) Annual Global Conference; September 21 – 24 in San Antonio, Texas I’m involved in a local chapter, and I find that to also be well […]
I publish in both Logistics Viewpoints and Forbes.com. Often, but not always, the blogs appear in both locations. As measured by page views, here are the most popular blogs of the year (I’ve omitted one blog about Conferences to Attend in 2013 because it is no longer relevant). Amazon vs. Walmart: E-Fulfillment vs. Omni-Channel Logistics […]
60 Minutes recently aired an episode that showed aerial drones from Amazon delivering goods right to the front porch of a customer. Jeff Bezos, the CEO of Amazon was touting their continued experimentation in the path to achieving same day deliveries. Same day delivery by drones is ridiculous. It is not just that the FAA […]
To support omni-channel initiatives, retailers have had to implement a technology most commonly known as distributed order management (DOM). These omni-channel programs often support new order flows, for example order online and have the order shipped to the customer’s home from either an e-fulfillment warehouse or a store. But as I thought about some of […]
Descartes, a provider of SaaS logistics software solutions, had their Global User & Partner Conference – Evolution 2013 – last week. The best presentation I saw was from Chris Jones, their Executive VP of Marketing and Services, on the topic of Omni-channel Home Delivery. Descartes is a leading provider of routing and fleet management solutions. […]
Nancy Getter, the Associate Director of Global Logistics at Procter & Gamble (P&G); Doug Watne, Director of North American Transportation at General Mills, Erik Neandross, a clean energy consultant for Frito-Lay, and Dave Warren, the President of Dart Transit Company, all spoke on a panel at CSCMP a few weeks ago about using natural gas […]
I am an industry analyst that follows supply chain software solutions. Industry analysts are very different from financial analysts, who generally care about whether buying a company’s stock will be a good investment. As an industry analyst, I care about the technology. How functionally rich is it? How scalable? What new products are being introduced? […]
The CSCMP Annual Global Conference, the most important supply chain conference of the year, had some nice mode-shift case studies. Speakers from Dell (Rob McIntosh, Global Reverse Logistics Director) and Caterpillar (Tom France, Director of Global Transportation) shared their insights and experiences last Monday. In the case of Dell, a manufacturer of personal computers (PCs) […]
Sales & Operations Planning (S&OP) is traditionally defined as a cross functional process designed to balance supply and demand. The main players traditionally involved in this process are demand forecasting, manufacturing, sales and marketing, finance, new product development, and executive management. In most S&OP processes, transportation and warehousing folks do not have a seat at […]
There were two recent stories about Amazon vs. Walmart when WalMart announced it was opening two new distribution centers to fill e-commerce orders. One story, in the Wall Street Journal (WSJ), got it mostly wrong (Wal-Mart Builds Warehouse for Web Orders), and a story in USA Today got it mostly right (Retail stores become shipping […]
In 2010, I wrote a strategic report on shelf-level collaboration – i.e., on how manufacturers can help retailers achieve a better in-stock position for their products. At that time, I concluded that many consumer products companies had initiated pilot projects, but very few had made significant improvements. There were many examples of individual divisions collaborating […]
The top two guys at FreshStart Logistics, Allen and Bill Ho, came to visit me. Their company sells an optimization engine for TMS. I have a geeky fascination with optimization. I’m don’t have a Ph.D in Operations Research, but I’ve seen the way a number of TMS solutions approach optimization. There were several things I […]
I heard an interesting speech by the director of logistics at a consumer goods company at the S&OP Innovation Summit. Like many companies, this company has highly-seasonal demand. To meet this demand at the warehouse, the company relies extensively on temporary workers. This is a story of how this warehouse went from a highly ineffective […]
I was invited to the MercuryGate user conference this year. MercuryGate is a SaaS provider of transportation management systems (and a Logistics Viewpoints sponsor). What most struck me was an application the company calls Carma (Carrier Management). Carma has been out for a few years, but I had never done a deep dive on it. […]
Can you rely on freight forwarders for trade compliance? To answer that question ARC interviewed trade professionals from 12 shipping companies. All of them agreed that you cannot put your fate into the hands of freight forwarders when it comes to compliance. If goods are misclassified, or if shipments go to restricted parties, the shipper […]
Last week, I discussed continuous moves in networks where they could be planned with a high degree of certainty. But there is another form of continuous moves — a more ad hoc, opportunistic type of move — that can be very difficult to operationalize. There are several reasons for this. First, when a carrier commits […]
I’m working on developing a supplier selection tool for Transportation Management Systems (TMS), and one form of optimization a TMS can support is “continuous moves.” I wanted to learn more about continuous moves and so I called several of our Logistics Viewpoints sponsors to discuss this topic. First of all, what is a continuous move? […]
A report from American Shipper shows that trade policy is driven largely by either the supply chain or compliance group. I assumed when I read this that the supply chain folks mentioned would be mostly logistics personnel. However, I had a conversation with John Wainwright, Vice President of Customs Compliance at Leggett & Platt, a […]
At ARC, we are doing a study on Global Trade Management (GTM) systems. Consequently, I and some of my colleagues have been researching trade. One of the most striking things is how concentrated it is. The U.S. Census Bureau issued a press release in April with the latest statistics. They identified about 200,000 companies that […]
I’ve been reading everything I can get my hands on about what Walmart is doing in the area of omni-channel fulfillment. I am struck with conflicting emotions – awe at the company’s vision and technological approach, and a great feeling of dread that it won’t be able to achieve its vision because of poor in-store […]
Apple’s CEO, Tim Cook, was hauled in front of a Congressional subcommittee in May and grilled about corporate tax avoidance. At issue is a complex corporate structure that allows Apple’s European subsidiaries to distribute profits to a holding company in Ireland where the corporate tax rate is 12.5 percent. As a result, Apple holds over […]
It used to be the marketing department did market research, and then it was the job of product development to create products that tapped into the profitable market niches that marketing identified. But market research can also tell a company what kind of supply chain it needs to develop. One case in point, many retailers […]
The Customs-Trade Partnership Against Terrorism (C-TPAT) is a voluntary supply chain security program led by U.S. Customs and Border Protection (CBP). It is focused on improving the security of private companies’ supply chains with respect to terrorism. C-TPAT, and programs in other countries/regions modeled after it like Europe’s Authorized Economic Operator program, promise the applicant […]
If you have a lawn mower, why would you need a lawn service? If you have an iPod nano and a cell phone, why would you also need an iPhone? If you have a transportation management system (TMS) and a network design tool, why would you need a transportation simulation solution? A network design tool […]
Earlier in the year, ARC developed a supplier selection tool for Warehouse Management Systems. Our goal in developing this tool was to have it enable the cross functional, end-to-end process of developing supplier selection criteria, sending those criteria to suppliers, getting responses, evaluating the responses, and making the final selection. I did not develop the […]
Eight years ago, Ace Hardware began working with LeanLogistics (a Logistics Viewpoints sponsor) to help with inbound freight moves. Scott McLean, Director of Transportation, and Carey Skoglund, National Logistics Manager, explained to me their journey to more fully leverage LeanLogistics to improve the transportation procurement program. Ace Hardware is a cooperative that serves 4,000 independently […]
Manhattan Associates (a Logistics Viewpoints sponsor) held its annual user conference, Momentum 2013, two weeks ago in Las Vegas. I’ve attended many supply chain conferences so far this year, but none have equaled this conference for coverage of the issues associated with omni-channel commerce. The best speech was the keynote by Matthew Siegel, Executive Vice […]
Large chemical and oil and gas companies are, in general, far more advanced in their supply chain risk management practices than companies in other industries. But my coverage of this area convinces me that Dow Chemical, in particular, is one of the most advanced companies in the world in supply chain risk management. Dow Chemical […]
Last week, I attended JDA’s user conference, JDA FOCUS 2013. There were more than 2,600 attendees there — a bigger event than last year because of the JDA/RedPrairie acquisition. One of the things I value about this conference is not only the opportunity to listen to smart customers talk, but also having conversations with some […]
A few months ago, I talked to a specialty retailer that operates both stores and a direct-to-consumer channel. Five years ago the company decided to bring its direct-to-consumer operation in-house and it built a 500,000 square foot distribution center (DC). The retailer implemented VARGO’s COFE warehouse control system (WCS) to increase warehouse efficiencies at this […]
Any time Walmart speaks about what it is doing in logistics, I’ll listen. In March, Steve Simpson, Senior Manager of Transportation Technology at Walmart, participated in a webinar on how Walmart is optimizing outbound loads through its implementation of ORTEC‘s routing and load-building solutions (ORTEC is a Logistics Viewpoints sponsor). A couple of caveats need […]
One of the funniest episodes of Seinfeld was “The Pool Guy,” where Kramer’s phone number is very similar to Moviefone’s, the movie listing service, and he gets many calls from people wanting show times. In the end, Kramer decides to just play along and he makes himself sound like an automated messaging system. For those […]
I believe that the next generation of transportation management solutions will leverage GPS and telematics technologies in much more robust ways than we are seeing today. For example, I was recently briefed by Esri, which provides Geographic Information Systems (GIS) and a platform/toolkit called ArcGIS that allows users to combine geographic data, including real-time and […]
An interesting and useful exercise for logistics executives to do at their annual strategic planning meeting is to ask, What are the megatrends that will change the face of logistics in five years? Ten years? Twenty years? And even forty years? For me, the three biggest megatrends are robotics in logistics (both for the warehouse […]
There was a very good article in the Wall Street Journal last Wednesday on the resurgence of rail. “North America’s major freight railroads are in the midst of a building boom unlike anything since the industry’s Gilded Age heyday in the 19th century, this year pouring $14 billion into rail yards, refueling stations, additional track,” […]
A relatively small number of software vendors offer distributed order management (DOM) solutions; IBM, Manhattan Associates (a Logistics Viewpoints sponsor), and Oracle are the best known of these vendors. What is DOM? It is a central order orchestration hub for companies with complex fulfillment networks. A DOM provides… a common view of inventory for companies […]
Earlier this month I attended the SAPinsider meeting in Las Vegas. SAP was actively promoting its HANA solutions, which uses in-process memory primarily for providing real-time analytics. HANA is particularly well suited to analyzing extremely large amounts of data very quickly. SAP says that HANA can analyze data hundreds of times faster than traditional approaches […]
Last August, my colleague Clint Reiser attended the Oracle Transportation Management Special Interest Group (OTM SIG) in Philadelphia, an independently run conference that drew almost 400 attendees, predominantly Oracle Transportation Management (OTM) users. Clint wrote an ARCview report about this trip that contained three short case studies, including an interesting overview of Kraft Foods’ implementation […]
Last week Macy’s, the department chain retailer, announced its fourth quarter results. The company has done well in a tepid economic environment. Macy’s has been beating estimates for same-store sales for several months, posting year-over-year comparable store sales growth of 3.7 percent. In its peer group, Macy’s is one of the industry’s star performers. As […]
In a previous posting, I wrote about how Kraft leverages downstream data to drive supply chain collaboration, based on a talk given by Ron Volpe, Customer VP of Supply Chain at Kraft Foods, at the CSCMP Annual Global Conference last September. In that article, I briefly mentioned that Kraft has truly audacious inventory reduction goals, […]
Google Glass is Google’s project to create augmented reality glasses. If you are not familiar with Google Glass, instead of me trying to explain it with words, watch this short video of the technology in action. Google Glass is being designed for consumers, but the first clear business application may occur in warehouses. Knapp AG […]
There’s been a lot of buzz lately about same-day delivery, with Amazon, Walmart, Nordstrom, Macy’s, Google, and eBay all launching or ramping up their efforts in this area (see “On Amazon’s Quest for Same Day Delivery” and “Google, Same-Day Delivery, and Container Tracking”). Here is why it matters: it results in fewer abandoned shopping carts. […]
Traditional retailers were fairly slow to wake up to the huge threat posed by Amazon. But my recent visit to “Retail’s BIG Show,” put on by the National Retail Federation (NRF), convinces me that they are now wide awake. One way bricks and mortar retailers have responded to Amazon and other e-retailers is by turning […]
Google has assembled a series of technologies capable of transforming logistics as we know it. Some of them are well known and the applications obvious; others less so. I’ll start with the obvious ones. Driverless cars Truck drivers will not be necessary at some point in the future, and that future will probably occur sooner […]
Sid Snitkin, one of my ARC Advisory Group colleagues, wrote a strategic report entitled “Technology Enables Better Risk Management” (available to ARC clients only). ARC is also having a track on risk management at our annual forum in Orlando coming up next month (February 11-14). In the report, Sid mentions various standards and guidelines for […]
Moisson Montréal is the largest food bank in Canada. They gather and distribute food, free of charge, to organizations that provide food and finished meals to families and individuals. In 2011-2012, Moisson Montréal delivered 10.4 million kilograms of food and other essential products — valued at over $55 million CAD — to community organizations on […]
Big box retailers are facing pressure from two directions, Walmart’s low prices and Amazon’s e-commerce driven convenience. These retailers are in the process of reinventing themselves by embracing omni-channel commerce, which aims to deliver a seamless consumer shopping experience through all available channels — i.e., mobile devices, personal computers, bricks-and-mortar stores, catalogs, and so forth. […]
It’s that time of year again, when shoppers hit the stores on Black Friday and go online on Cyber Monday, the biggest day of the year for Internet sales. Experts predict that Internet sales will increase 12 percent this year; Amazon’s sales this holiday season will grow much faster. At the CSCMP Annual Conference in […]
I attended the Descartes Evolution 2012 Global User & Partner Conference a couple of weeks ago. When Art Mesher took over as CEO of Descartes Systems Group eight years ago, I wasn’t sure the company was going to survive. Today, it is a thriving company. What are the secrets of its turnaround? Descartes (a Logistics […]
At the ToolsGroup North American User Forum earlier this fall, the company’s CEO talked about how ToolsGroup is incorporating machine-learning technology into its demand planning solution. Machine learning, which is a branch of artificial intelligence (AI), uses specially-designed algorithms to generate predictions based on entered data. ToolsGroup is using AI to improve its demand forecasting […]
I am slogging through the book “Thinking, Fast and Slow” by Nobel Prize winning economist Daniel Kahneman. The main premise of the book is that the human brain has two systems for thinking: one that is “fast,” uses simple rules, and learns patterns; the other is “slow,” requires great effort, and is the source of greater […]
At a Home Depot Investor Conference, Hal Lawton, President of Home Depot’s Online Business, said “approximately 50 percent of our sales involve online research at some point in the shopping process. And another key fact is that almost one in every four store shoppers have previously been on homedepot.com before purchasing in our store. It’s […]
As Chris Jones from Descartes said in a Logistics Viewpoints column, the Forrest Gump quote — “Life is like a box of chocolates; you never know what you’re gonna get” — applies to the challenge of managing a yard, particularly inbound dock operations. A yard management system (YMS) controls the yard attached to a warehouse […]
ARC Advisory Group surveyed 52 logistics executives and asked them if their companies were using any sort of warehousing costs per unit measurement, defined as “total warehousing costs/total units shipped.” Thirty-seven percent of the respondents were not using this this metric type, which is far too low. Ideally, if a company is doing pallet shipments, […]
At the CSCMP Annual Conference a couple of weeks ago, I attended the best supply chain presentation I’ve been to in years. It was given by Ron Volpe, Customer VP – Supply Chain at Kraft Foods, and Jon Golovin, CEO of Retail Solutions Inc. Kraft is using solutions from Retail Solutions to better leverage its […]
In previous postings, I’ve written about Amazon’s acquisition of Kiva Systems and on how the Kiva system works. At the CSCMP Annual Conference last week, Mike Roth, the VP of North American Fulfillment Services at Amazon, talked about using automation sparingly to preserve flexibility. He pointed, for example, to the exploding number of product categories […]
I read the book “Moneyball” by Michael Lewis and loved it. It was about how the Oakland Athletics, a baseball team with a small payroll, bucked conventional thinking and made themselves a consistent playoff team in the late 1990s and early 2000s while competing against much wealthier teams with much larger payrolls. Their ability to […]
I spoke recently with a transportation manager at a manufacturing company about a strategic transportation procurement event his company had conducted. What impressed me the most about the results was how little slippage the company has experienced in its projected savings. This manufacturer had not conducted a network-wide transportation procurement event for some time. Before […]
For more than a decade, I’ve been a fan of using granular cost-to-serve analytics to make better business decisions. Traditional accounting systems provide a distorted lens on the true costs of serving customers. In contrast, Activity Based Costing (ABC) solutions gather granular data on customer profitability based on the true costs of fulfillment for a […]
In May, MercuryGate issued a press release announcing that it had been awarded a “2011 Total Cost of Ownership Supplier Award” from Celestica. MercuryGate (an ARC client and Logistics Viewpoints sponsor) was in competition with over 20 other software vendors for this award (MercuryGate also won the 2010 award). I recently spoke with Ryan Bloor, […]
Rich Sherman has written a book titled “Supply Chain Transformation,” which will be released in October. It is one of the better supply chain books I’ve read, and certainly the most entertaining. Rich is a well known figure in our industry who came to supply chain management with a background in marketing. At one point […]
JDA’s transportation management system (TMS) product management team recently visited ARC to brief us on their product roadmap (JDA is an ARC client and Logistics Viewpoints sponsor). I also got a chance to see a product demo that highlighted those enhancements. Because I’m conducting research on supply chain analytics, the visit also gave me a […]
Recently, Kiva Systems told its existing clients how its acquisition by Amazon would affect them. But the news also revealed something about Amazon’s distribution strategy. So here is the news: Kiva will not be selling any new systems to new customers for the next one and a half to two years. Instead, Amazon will be […]
A few years ago I did some research on telematics. At the time, an insurance underwriter in the UK was exploring the idea of using telematics data to price automotive and fleet insurance. Since then, underwriters have started using GPS/telematics to price automotive insurance. Progressive Insurance has a program called Snapshot where it mails a […]
Inventory management is very difficult in a spare parts warehouse. For example, if you are a car or truck manufacturer, your warehouse network needs to carry spare parts for a vehicle you might have stopped making decades ago. Further, your network of dealers and repair shops don’t want to wait for spare parts; industry standard […]
A while back I wrote a posting where I claimed that if a top-tier Warehouse Management System (WMS) has not been too heavily customized, the costs associated with an upgrade would be about 15-20 percent of the original implementation cost. But this is only true if we are not talking about the dreaded platform “upgrade”. […]
Gathering benchmark data to drive better procurement is a very valuable exercise. In the realm of transportation, this means getting benchmark data on what companies are paying to move freight on particular lanes. However, for a benchmark to be valid, you need a sufficiently large sample size, which is not a problem if you are […]
Many supply chain professionals consider Apple’s supply chain to be the best in the world. I don’t. The reasoning appears to be that since Apple is one of the fastest growing and most profitable companies in the world, it must surely have one of the best supply chains too. This is a “halo effect” fallacy. […]
US logistics professionals are tracking the status of the Highway Bill — formally known as the Safe, Accountable, Flexible, Efficient Transportation Equity Act — and they are concerned about longer and less predictable lead times if our highways don’t get the necessary funding. But after reading a recent ARC Advisory Group strategy report titled “Smart […]
Recently, I’ve been reading some articles in Army Sustainment, a logistics publication for the US army. “Sustainment” refers to sustaining troops in the field. I began reading this publication with the hope of learning something from the field of military logistics that companies in the private sector could apply in their supply chains. The military […]
In several industries, pending regulations call for more robust product traceability. Many manufacturers view traceability as a necessary cost, rather than something that brings benefits. However, under no regulatory requirement to do so, Bayer CropScience recently implemented an end-to-end product tracking system solely for the benefits it could provide, particularly to customers at the end […]
John Lewis is a leading retailer in the United Kingdom. The chain includes 29 full-line department stores, 8 At Homes (small format stores), and an online/catalogue business. The company differentiates itself on customer service. When a customer orders a bed and a washing machine, for example, John Lewis not only delivers the items, it also […]
All too often, when companies buy and implement supply chain software, you hear a similar story: the implementation took longer than planned and the company grossly underinvested in training. Also, the needed software customization made future upgrades costly and time consuming to the point where upgrade cost and effort often rivaled a brand new implementation. […]
I attended RedPrairie’s RedShift user conference last week in Hollywood, Florida (RedPrairie is an ARC client). There were over 1,000 attendees, the company’s largest event ever. Several high-profile customers were prominent in this year’s proceedings, including Walmart that uses RedPrairie’s store execution products; Kraft that spoke on its implementation of RedPrairie’s flowcasting (demand sensing) and […]
If you were hired as the top Supply Chain Management executive at a company, what would be your top three initiatives to improve the company’s capabilities? Here is my list: 1. Get the right people on board! You can’t accomplish anything else if you don’t have the right talent. The toughest part of the job […]
Last week, Infor (an ARC client) held its user conference, Inforum 2012, in Denver, Colorado. This year’s conference drew almost 5,000 attendees. Infor is the third largest supplier of enterprise solutions with almost 70,000 customers. Infor is a provider of several different industry-specific enterprise solutions. The company also provides best-of-breed solutions in areas such as […]
In our weekly news roundup a couple of weeks ago, we briefly reported on the World Trade Organization’s trade figures for 2011. Because global trade is an important topic for supply chain professionals, I thought it was worth digging just a bit deeper. As reported in the WTO press release, “World trade expanded in 2011 […]
Transportation Management Systems (TMS) were initially designed to handle the complexities of outbound shipments. And to this day, companies are still far more likely to implement a TMS to reduce outbound freight costs than to manage inbound or international moves. I realized just how complex inbound transportation can be when I spoke with the North […]
Amazon.com’s acquisition of Kiva Systems keeps coming up in my conversations with industry peers and colleagues. Kiva is a provider of advanced robotic material handling systems — or looked at in an alternative way, the company brought to market much more intelligent Automatic Guided Vehicles (AGVs) than we had seen before. Adrian wrote about the […]
Do you want to understand the supply chain capabilities of your key competitors? Or gain insights into how their supply chains are structured? If your competitor is a large company, they almost certainly have a vendor guide. And if you type their name and “vendor guide” into a search engine, there’s a good chance you’ll […]
Future Electronics is a world leader and innovator in distributing and marketing semiconductors and passive, interconnect and electro-mechanical components. Future is a private company, headquartered in Montreal, Canada. The company differentiates itself by providing an exemplary standard of customer service through product marketing, technical solution support, in-depth inventory, professional selling procedures, and highly-reliable distribution systems. […]
I had never watched an episode of the popular television show “Undercover Boss,” but when I saw in a commercial that they were taking their cameras inside a warehouse, I decided to tune in. Sam Taylor, the CEO of Oriental Trading Company (OTC), posed as a new warehouse employee. OTC is the nation’s largest direct-to-consumer […]
One choice international shippers face is whether to sign long-term contracts with ocean carriers or use freight forwarders and pay spot market rates. In the current environment, spot market rates are often lower, but shippers may face a service penalty when capacity tightens. Just as airlines overbook, so do ocean carriers. However, while airlines reward […]
In 2007, the book “Competing on Analytics” by Tom Davnport and Jeanne Harris became a business bestseller. The premise of the book was that companies could create a competitive advantage by using Business Intelligence (BI) tools in smart ways. One advanced use of BI involves running a supply chain related experiment and then using a […]
There are certain supply chain topics that are rarely discussed publicly. “Supply chain integrity” is one of them. Companies don’t want to admit that their products are being counterfeited, or that theft and grey market diversions are hurting profitability. They also don’t want thieves to know about the security measures they are taking to protect […]
In the US we speak about “pallet pooling services,” while in the UK people speak of “pallet networks.” It turns out these are two very different things. The UK and the US — two nations divided by a common language. “Pallet pooling services” involve shippers renting pallets from companies like CHEP. These service providers collect […]
At Oracle OpenWorld last October, Kevin Kroymann, Director of Trade at Hormel Foods Corporation, gave a presentation about the company’s journey to improve the returns it gets from promotions with leading grocery retailers. Based in Austin, Minnesota, Hormel Foods Corporation is a multinational manufacturer and marketer of high-quality, brand-name food and meat products for consumers. […]
At the end of December, the Boston Globe published an article titled, “Wide heart monitor use tied to missed alarms.” I had a strong feeling I had read that article before, and then I realized I was having a déjà vu moment — ARC had published a strategy report in 2004 focused on alarm management […]
In South Korea, Tesco has a chain called Home plus that has become the second largest retail chain in the nation. The 115-store chain consists of big discount hypermarkets similar to Walmart in merchandise, but also similar to mini-malls in that they feature numerous independently-operated smaller stores like travel agencies, fast food, and bookstores that […]
More than a decade ago, our family started ordering our groceries from an online grocer that delivered right to our house. In fact, they put a full-size refrigerator in our garage so that perishable food would not spoil while we were at work. We loved it. Then the company went broke. They’re gone, but we […]
In recent months I’ve talked to two natural resource companies that have implemented a transportation management system (TMS) and have achieved very different outcomes. Both companies had similar goals: reduce freight spend and improve service. But only one company achieved success on both fronts; the other has had limited success in improving service. The company […]
The Holidays are a time for giving. My posting today celebrates the best example of corporate giving that I came across in my travels this year. TNT, a large global provider of express deliveries, and ORTEC, a company that provides a logistics optimization and execution platform with advanced planning capabilities, are the two companies whose […]
I’ve been paying attention to multi-tenant Warehouse Management Systems (WMS) ever since they appeared in the market about five years ago. A multi-tenant system has an architecture where users from different companies and different parts of the world access the exact same Internet-based software. Salesforce.com is the best known enterprise solution based on this architecture. […]
On August 30th, O’Reilly Auto Parts gave a presentation to financial analysts from one of its distribution centers (DCs) in Kansas City, Missouri. This signaled that the company considers distribution excellence to be a core differentiator, a message that comes out loud and clear when you look through the presentation the company gave. O’Reilly Auto […]
At one of the conference receptions I attended this fall, I heard an interesting story about a Global Trade Management (GTM) system implementation. At one level, the business case was focused on fine mitigation. US Customs had warned this company several times about shipments lacking the proper licenses, permits, and classifications. Finally, customs lost its […]
Over the past few weeks I’ve attend TMC’s Interactive Client Forum and Descartes’ Evolution 2011 User Conference (TMC and Descartes are ARC clients). At both conferences, there were speakers focused on regulatory trends in transportation. The Descartes conference featured Annette Sandberg, a former Administrator of the Federal Motor Carrier Safety Administration (FMCSA). TMC’s conference featured […]
It is common to speak of a “one number” demand forecast. And a “one number” forecast works fine if your demand forecast and your manufacturing planning are based on the same time period. For example, if you do a monthly forecast and the plant uses it to plan production for the entire month, then there […]
I wanted to write a case study about a company that had implemented trade promotion optimization, so I conducted some secondary research and came across the following claim in analyst reports, trade publications, and comments made by software vendors: “For consumer products companies, trade spend is the second-largest expense item on their Profit and Loss […]
The first paragraph of my colleague Dick Slansky’s recent Strategic Report on Smart Products’ Supply Chain Challenges (available to ARC clients only) caught my attention. Increasingly, today’s consumers are being exposed to an environment of intelligent products –from toasters to automobiles. The level of intelligence embedded in everything from our cars, to our homes, communication […]
Back in August, I saw Ryan Kieczykowski and Ravi Kutty from Niagara Bottling present at the Oracle Transportation Management (OTM) Special Interest Group meeting in Philadelphia. Then last week I attended Oracle OpenWorld and Oracle (an ARC client) arranged a meeting between me and Ryan and Ravi. I’m glad they did because the conversation we […]
My colleague Clint Reiser and I recently interviewed twelve logisticians at manufacturing, retail, and distribution companies ranging in size from very large to very small. Our focus was on four key dimensions that should logically correlate with how well a Third Party Logistics (3PL) provider is able to perform. Those dimensions include a 3PL’s IT […]
I recently had a conversation with the Director of Logistics at a US-headquartered industrial manufacturing company that has several plants in Mexico, the US, and Canada. He had several interesting things to say about his company’s regional supply chain. First, let’s talk about the basics of this integrated, regional supply chain that includes Mexico. Near-shoring […]
I visited my first Control Tower a few weeks ago–TMC’s North American facility in Chicago. TMC is the transportation managed services division of C.H. Robinson Worldwide, an ARC client. A Control Tower is a location where a transportation managed services provider uses its transportation management system (TMS) to do regional planning and execution of transportation […]
Infosys, the global IT services company with an offshore model, held its annual Infosys Connect conference last month. Two directors from a very large consumer packaged goods (CPG) client spoke during a track session for analysts. Like many Western multinational firms, this company’s growth will largely come from developing countries, where the company has a […]
When it comes to following supply chain processes and technologies, the supply chain that extends from a food manufacturer’s factory to retail stores has always gotten a disproportionate share of attention. This is natural because large food & beverage and consumer goods companies were the first to use warehouse and transportation management systems, are heavy […]
SAP briefed ARC a while ago on its benchmarking services, the company’s version of the benchmarking metrics offered by the Supply Chain Council (SCC) and the Warehouse Education Resource Council. In fact, SAP tells us that it is “compliant” with the SCC’s Supply Chain Operations Reference (SCOR) model. This basically means that many, but not […]
In the past I have written about the value of flexibility as a driver for what type of material handling you select for your warehouse. I’ve pointed out that companies that implement highly-automated warehouses are very focused on driving down fulfillment costs to the maximum extent possible, although the payback period is often five years […]
Erik Qualman, author of “socialnomics,” was a keynote speaker at RedPrairie’s Redshift 2011 conference in May. He gave the most interesting conference speech I have seen in years. The following week Don Tapscott, author of “Macrowikinomics,” gave another great keynote speech at Manhattan Associates’ Momentum 2011 conference. In both cases, the speakers grossly overstated the […]
Cross functional collaboration has always been a central idea in supply chain management. Today, I will highlight a form of supply chain collaboration that is new to me: supply chain facility design and construction. When it comes to product development, globalization has led companies to engage in co-development projects with key suppliers. Perhaps the most […]
So much of supply chain management is, and must be, top down and focused on tight process control. Companies have applied Six Sigma and Lean to factories and warehouses to lock down processes in pursuit of high quality and throughput. While there is room for input from floor-level workers, there is not a lot of […]
Last year, I wrote about how DSC Logistics implemented a labor management system (LMS) and how it helped the company improve labor productivity at its warehouses. Regular readers of Logistics Viewpoints know that I am a big fan of LMS because of its robust ROI. DSC Logistics got a 20 percent improvement in warehouse labor […]
Ronald Coase is a Nobel Prize winning economist who wrote about “transaction costs” and how they impact firms and economies. Because of Internet technologies, transaction costs have fallen in many areas, and this is changing the way firms organize their work (including supply chain tasks), the fate of particular industries, and even the economic fortunes […]
The title of this posting comes from a speech Peter Unanue, Executive Vice President at Goya Foods, gave at the JDA Software user conference last month. Goya Foods is the largest family-owned Hispanic food company, and the number one Latin brand, in the US. The company’s Americas supply chain contains six factories and fourteen distribution […]
One of my favorite books is the classic “Catch-22” by Joseph Heller. In the book, the main character, Yossarian, is desperate to find a way to avoid combat missions. Those missions, in the long run, would almost certainly get him killed. So, he wanted to be classified as insane to avoid those missions. “There was […]
Nestlé USA has a Direct Store Delivery (DSD) division focused on several of its frozen food brands, including Edy’s and Dreyer’s (ice cream) and Digiorno, Tombstone, and Jack’s (frozen pizza). The company’s move to DSD began in 2006 when it acquired Dreyer’s Grand Ice Cream and the scope of its operations has grown since acquiring […]
At the JDA Focus 2011 conference, I saw a presentation by Matt Webb and Tony Poole of Kimberly-Clark that outlined an interesting application of Lean. Kimberly-Clark applied the Lean continuous improvement process to its JDA transportation management system (TMS). The company felt that it was paying transportation analysts a lot of money, but those analysts […]
According to a recent ARC report, “Food Safety: Are We Getting Better or Worse?” (available to ARC clients only), statistics show that the number of food-borne illnesses and their severity have remained relatively constant over the years. “In the US, this translates into 76 million gastrointestinal illnesses, 325,000 hospitalizations, 5,000 deaths, and billions of dollars […]
Regular readers of Logistics Viewpoints know that Adrian and I are fans of multi-tenant, network-based transportation management systems (aka software-as-a-service TMS). These solutions take the burden of connecting to carriers and cleansing EDI messages off the back of the shipper. They also make it easier for a shipper to add new carriers if they have […]
Earlier this spring, I attended a large software vendor’s user forum that focused on its supply chain solutions. I was particularly interested in hearing about the implementation of a warehouse management system (WMS) at a large grocery chain in Europe. Unfortunately, the speaker from the retail chain was from the IT department, and he spoke […]
Kichler Lighting is a family-owned company that designs, engineers, markets and distributes lighting solutions. Kichler does not sell directly to consumers. While the company does sell products through the large home improvement retailers, the bulk of its products are distributed to other retail customers, such as showrooms, electrical distributors, landscape lighting distributors, and catalogue and […]
Earlier this month, I wrote a posting about the significant benefits RockTenn experienced when it outsourced freight audit to a third party company. In general, companies that outsource freight audit to specialists can expect to save about two percent off their total freight bill in the first year. Ongoing savings, once processes are under better […]
Last year, I wrote a strategic report on shelf-level collaboration–i.e., on how manufacturers can help retailers achieve a better in-stock position for their products. As part of my research, I asked suppliers of Demand Signal Repository (DSR) solutions for references at client companies they believe are doing an excellent job in this area. I also […]
I recently had a conversation with Chris Cavin, the Director of Purchasing Shared Services at RockTenn (and formerly the company’s Director of Transportation), about RockTenn’s approach to freight audit and payment. RockTenn, based in Norcross, GA, is a leading North American producer of paperboard, containerboard and consumer and corrugated packaging, with annual net sales of […]
What makes for a good Business Intelligence (BI) module for a Transportation Management System (TMS)? There are different types of TMS solutions. Today I will focus on the most common type: solutions for shippers who work with third-party carriers to move their goods. There are six things to look for in a transportation BI module: […]
At the Descartes User Conference last year, a leading food and beverage manufacturer spoke about its implementation of a Mobile Resource Management (MRM) solution from Descartes (an ARC client). At a high level, the manufacturer’s goal was to improve its merchandising and store delivery operations. Like other CPG companies, this manufacturer employs merchandisers (about 10,000 […]
I recently attended a presentation, given by an executive at a very large global company, on anti-counterfeiting and brand protection (ABP) and supply chain management. This executive reports to the supply chain organization, which he likes because so many of the touch points associated with brand protection occurs in the supply chain. He views brand […]
The Federal Motor Carrier Safety Administration (FMSCA) initially sold CSA 2010 as a tool for carriers to drive continuous improvement in driver safety, and it specifically said that this data was not intended for brokers, shippers, law firms, or insurance underwriters. But now that the data is publicly available, it is going to be used […]
In January, the Food Safety Modernization Act (FSMA) was passed and signed into law. The bill increases the Food and Drug Administration’s authority over food recalls. It allows the FDA to require food producers to have safety plans and enhances the FDA’s ability to improve the safety of imported foods. The bill, however, does not […]
It’s probably dead on arrival, but President Obama’s recent proposal to spend $53 billion on passenger trains and high-speed rail projects over the next six years strikes me as a particularly bad investment. Improving the rail infrastructure for freight, however, could have a real payback. High-speed rail is almost always designed for passenger travel (one […]
Last August, there was an interesting article in the New York Times titled “Nordstrom Links Online Inventory to Real World.” While many retailers at the time were experiencing year-over year sales decreases at stores open for more than a year, sales at the high-end chain Nordstrom were actually improving and outperforming the department store average […]
HighJump Software, a leading Supply Chain Execution (SCE) software vendor and an ARC client, announced yesterday the launch of its “HighJump App Station,” where customers can browse supply chain workflows and add them to their warehouse management system (WMS) anytime, similar to the way iPhone users can download apps from Apple’s App Store. HighJump actually […]
A few weeks ago, I wrote a posting about how fleet routing applications could be improved by using “real-world” traffic data, particularly data on the true average speed per hour of vehicles traveling on specific road sections at different times of the day and week. GPS navigation device vendors like TomTom have this data, which […]
According to Fortune magazine, Amazon (the largest online retailer) is now the 100th largest company in America. The company was founded in 1994 with the intention of leveraging the Internet to create a new sales and fulfillment model. Amazon has gone from zero revenues to over $24 billion in little more than 15 years. I […]
If your consumer goods supply chain starts at the retail store shelf, which is what many companies are striving toward, then it is very important that you understand what is occurring at the store shelf. But do you? Not according to Mike Spindler, the CEO of ShelfSnap. I subscribe to ShelfSnap’s newsletter because I think […]
This is the time of year when writers put together their “Best of” lists, in part because they are easy to write. And on my list of best business books of the year, there’s only one book: Matt Ridley’s “The Rational Optimist: How Prosperity Evolves.” Having only one book on my list makes writing today’s […]
When you think of competing on the basis of supply chain excellence, Walmart is probably the first retailer that comes to mind. Walmart is indeed excellent, perhaps the best in the world when it comes to procurement. But I would argue that from a lean logistics perspective, BJ’s Wholesale Club is one of the best […]
Cap and trade legislation may be dead, but companies still want to be publicly percieved as being socially responsible. Implementing a Transportation Management System is a way for companies to reduce their transportation costs while also reducing their carbon footprint. This is a logistics and environmental win-win. But I recently downloaded a report from Cefic, […]
When it comes to supply chain management, anytime you can take discrete pieces of work and group them together intelligently, you have the opportunity to optimize. The more time you have, and the more discrete pieces of work you can group together, the larger the potential savings from optimization. I recently wrote about waving in […]
I believe mobile robots will eventually change the face of warehousing. Kiva Systems, for example, has developed robots for each picking that can retrieve a small, square rack with multiple slots. The robot brings the rack to the worker, spins it so the correct facing is towards the picker, and then the slot to be […]
In consumer goods to retail supply chains, what affects the point of purchase, affects the supply chain. This has always been true, but with shelf-level collaboration and demand-driven programs expanding, it is even truer today. With that in mind, I reached out to my media contact at the SymphonyIRI Group to get a copy of […]
A few weeks ago, a press release from PostcodeAnywhere caught my attention. The company introduced a new routing solution for private fleets that uses real-world data from tens of thousands of customers driving with TomTom devices in the UK. This is the first routing solution that I am aware of that uses “real-world” average speed […]
How can you have a satisfied warehouse workforce, and what does it take to retain them? That was the focus of a research project conducted by Bryan Edwards, an Assistant Professor in the Department of Management at Oklahoma State University, together with Kevin Gue, an Associate Professor at the Department of Engineering at Auburn University, […]
If you import goods, bonded warehouses can save you money. When you exports goods to Europe, you usually have to pay a tariff on those goods. By storing goods in a bonded warehouse, you can delay payments of the duties until the goods are released from the warehouse. In other words, bonded warehouses improve a […]
When companies implement a Warehouse Management System (WMS), the primary payback they receive typically comes from improved labor productivity, and wave management functionality is often critical to generating that productivity. Wave management is based on intelligently grouping a batch of warehouse activities together for later release to the floor. This batch of work (or “wave”) […]
Currently, with the weak economy, many companies are not thinking so much about labor shortages. But here is a sobering thought: In 2011, the oldest of the 76 million baby boomers (people born between 1945 and 1964) will turn 65, the traditional retirement age. A systematic labor shortage is expected to impact many industries. In […]
I received a newsletter from the Supply Chain Risk Leadership Council (SCRLC) and it made me realize how much this field is starting to advance. SCRLC has developed a very nice way of categorizing supply chain risk management (SCRM). They view it as being composed of five distinct disciplines: Preparedness, Continuity, and Recovery Planning; Regulatory […]
My colleague Janice Abel recently wrote an ARC Strategic Report called “Best Practices for Anti-Counterfeiting and Brand Protection” (available to ARC clients only). Achieving excellence in anti-counterfeiting and brand protection (ABP) is a multipronged, cross functional effort that requires the use of various technologies. But Janice makes the case that the supply chain organization has […]
Kevin Smith, the President of Sustainable Supply Chain Consulting, gave an entertaining speech at the Descartes Global User Group Conference last month. Before starting his own consulting practice last year, Kevin spent eight years as the SVP of Supply Chain & Logistics, followed by a year as the SVP of Corporate Sustainability, at CVS Caremark […]
HighJump Software (an ARC client) held its Innovation 2010 User Conference in Scottsdale, Arizona this week. HighJump sells solutions in three areas: Supply Chain Execution (WMS, MES, and TMS); Direct Store Delivery; and EDI, after its recent acquisition of TrueCommerce. However, when I think of HighJump, I think of the flexible Supply Chain Execution software […]
I’d always thought that the best places to recruit new graduates for a career in supply chain were universities with strong supply chain and logistics programs, such as Georgia Tech, MIT, Penn State, and the University of Tennessee (to name a few). The thought of hiring industrial engineers never occurred to me. But after a […]
Productivity improvements are based on increases in output per hour. A company can’t improve warehouse productivity to the maximum extent possible if it doesn’t understand the places where time is being lost. So, what are the main sources of productivity losses in the warehouse? Here is how I think about it: The chart above contains […]
The mine disaster in Chile that trapped 33 miners captured worldwide attention. The cave-in occurred on August 5th. Initially, officials in Chile announced a plan to get the miners out by the end of the year. Subsequently, they came up with two alternate plans—B and C. I spoke with Chip Chappelle, Director of Humanitarian Supply […]
At the IE Group’s Sales & Operations Planning (S&OP) Innovation Summit last month, several of the speakers, including some representing software vendors, said that people and process were far more important than technology in achieving S&OP excellence. But interestingly, the companies profiled in the case studies as having the most robust and mature S&OP processes […]
(Editor’s Note: This is the final part of a series on warehouse labor standards. Click here to read Parts 1-5). The most granular labor standards are based on time studies or predetermined time systems (PTS). MSD and MOST, in turn, are the two most prevalent methodologies used to develop PTS time standards for the warehouse. I […]
I had the opportunity to see Carl Offhaus, Director of Supply Chain & Consumer Services at Stanley Black & Decker, speak at the IE Group’s Sales & Operations Planning Innovation Summit in September. Carl spoke about the techniques his company uses to manage end-of-life stock keeping units (SKUs). Stanley Black & Decker is a $9 […]
When it comes to creating labor standards for the warehouse, both time studies and predetermined time systems (PTS) appear to create highly accurate and granular labor standards. But how objective are they really? The truth is that there is some subjectivity associated with time studies and PTS. Time studies have something called “pace and skill […]
I’ve been hearing about hospitals implementing warehouse management systems (WMS) in France and Canada. This is a new industry for WMS. So, when Oracle (an ARC client) mentioned that The Ottawa Hospital (TOH) was a WMS customer, I asked if I could interview them. Oracle put me in contact with Cameron Love, Vice President of […]
I attended Oracle OpenWorld 2010 last week (Oracle is an ARC client). I always enjoy going to this conference; it provides a great opportunity to speak with very smart supply chain professionals and hear case studies of cutting-edge SCM processes. Here are my high-level key takeaways from the conference. Oracle has the broadest set of […]
I recently attended the Sales & Operations Planning Innovation Summit organized by the IE Group. One of the first speakers and moderator for the first day’s sessions was Rich Sherman, Director North America of the Supply Chain Council. Rich’s presentation made me realize that it’s been a long time since I last wrote about the Supply Chain […]
(Editor’s Note: This is Part 4 of a series on warehouse labor standards. Click here to read Parts 1-3). Time studies and predetermined time systems are the two most accurate ways to develop labor standards. Time studies are easy to understand. These “stopwatch standards” involve consultants timing how long it takes workers to perform different […]
I recently had a conversation with Motorola’s Mark Wheeler—his colleagues call him the “warehouse guy,” an appellation of high honor in my opinion—and the topic of “wearables” came up. Wearables are light mobile computers with a ring scanner that are worn on the forearm. Mark told me there are cases where wearables provide better labor […]
(Editor’s Note: This is Part 3 of a series of postings on labor standards. Click here for Part 1 and here for Part 2). Discrete labor standards are more accurate than other types of standards, such as single and multi-variable, for several reasons. First, with discrete standards, travel time allocation is based on a warehouse […]
As we have written about in previous Logistics Viewpoints postings, most retailers admit that they do a poor job at in-store logistics. Per our definition, in-store logistics spans from the store’s loading dock to the shelf. HBS Working Knowledge recently published an article by Julia Hanna (“How Mercadona Fixes Retail’s ‘Last 10 Yards’ Problem”) based […]
As I searched through my supply chain contacts in preparation for some research I was kicking off, I came across the name Mark Servidio, Vice President Logistics & Environmental Affairs at Sharp Electronics. Mark’s title caused me to pause and think: If a company is serious about being green, it would likely have executives with […]
Companies can use several different types of standards to set goals for how long it should take employees to complete different tasks in a warehouse. Today I want to describe how single and multi-variable standards are developed, and their pros and cons. (As in Part 1 of this series, Al Gagnon and Tom Stretar of enVista […]
Ideally, the supply chain team includes more than just the folks who work in manufacturing and distribution. For the supply chain to work efficiently and effectively, there are other folks in a company (who may not report to the Vice President of Manufacturing or Distribution) that should also be on the team. Human Resources – […]
Back in July, I wrote a posting about the great results that DSC Logistics received after implementing a Labor Management System (LMS) in its warehouses. In one section I wrote that DSC “used a predetermined time system, Master Standard Data, as its methodology.” I knew at the time that some readers would not understand that […]
As I write this, Hurricane Earl is chugging up the East Coast. I live in Boston; we don’t yet know if the hurricane will hit our area or whether we will just get much needed rain. The waiting has got me thinking about the weather related risks of global warming. Scientific consensus is that global […]
Currently, with the weak economy, many companies are not thinking so much about labor shortages. But here is a sobering thought: In 2011, the oldest of the 76 million baby boomers (people born between 1945 and 1964) will turn 65, the traditional retirement age. A systematic labor shortage is expected to impact many industries, especially […]
I recently spoke with Jeff Kastning, Senior Manager of Logistics and Distribution at Brooks Sports, about the company’s recent implementation of a software-as-a-service (SaaS) labor management system (LMS). Brooks Sports, headquartered near Seattle, Washington, designs and markets high-performance men’s and women’s running shoes, apparel and accessories. The company operates a 140,000 square foot distribution […]
Supply chain organizations are often forced to work harder because sales force targets and bonuses are not well thought out. And when the CEO pressures the sales force to meet the quarterly revenue number he has promised Wall Street, watch out! In these scenarios, the CEO often gives the sales force the power to provide […]
The Fifth Annual Global Pharma Manufacturing Summit, organized by WTG, was held in Boson this past June. James Hagan, Vice President of Sustainability and Environment at GlaxoSmithKline (GSK) gave a presentation on “Strategies for Environmentally Sustainable Manufacturing.” My colleague Janice Abel attended the presentation and interviewed Mr. Hagan afterwards, which was the basis for a […]
Gob was a self-educated turkey. He studied statistics for fun. His quarters were a bit tight at the farm, but the upside was that for 140 days straight he had been fed a nice grain meal. And as he got older, the meals got bigger. Based on this history and his statistical models, Gob had […]
My colleagues at ARC recently published a report (available to ARC clients only) on electric vehicle technologies. It struck me that some of the information in it would be interesting to truck fleet owners. According to the ARC report, there are four different types of e-vehicles: hybrid electric vehicle (HEV); plug-in hybrid electric vehicle (PHEV); pure […]
I recently spoke with Jim Chamberlain, the Director of Engineering at DSC Logistics about their rollout of RedPrairie’s Labor Management System (LMS) solution. Jim began his career at Kraft where he worked to develop labor standards. Based on that experience, he knew this was a big opportunity for DSC when he joined them. In 2005, […]
Before you implement a supply chain planning or execution solution, you should talk to other companies that have implemented the solution (ideally, about 20 companies), as well as consultants and analysts familiar with the technology. If you are a busy executive and don’t have the time to conduct these interviews, someone on your staff can […]
The National Institute of Standards and Technology (NIST) is researching how software-as-a-service (SaaS) solutions and cloud computing are being used and deployed today and how these technologies will evolve in the future. Because SaaS is so prevalent in the transportation management systems (TMS) and mobile resource management (MRM) markets, I thought it would be worthwhile […]
ARC recently published a strategic report called Asset Performance Management: An IT Perspective (available to ARC clients only). As I read through the report, I started thinking about a distribution center (DC) I recently visited. This 750,000 sq. ft. warehouse, which cost $250 million to build, made extensive use of conveyors and sorters directing jobs […]
When companies construct supply chains around new products, they often decide to engage with partners in China or other low-wage nations for manufacturing. However, this choice comes with the risk of counterfeiting. ARC recently published a strategic report titled “Global Strategies for Anti-Counterfeiting and Brand Protection” by Janice Abel and John Blanchard (available to ARC […]
I’ve seen hundreds of presentations on how companies have implemented a supply chain software solution. I’ve also talked to hundreds of individuals who have been involved in implementing solutions. Successful projects include people, process, and technology considerations. Today, I want to summarize the main people-related considerations experienced implementers talk about. First of all, a variety […]
VICS, the Voluntary Interindustry Commerce Solutions Association, has a program called “Empty Miles.” It is an online backhaul solution that enables a collaborative business process for identifying transportation efficiency opportunities between trading partners. When I attended the annual JDA user conference a few weeks ago, one of JDA’s retail customers endorsed this program. Empty Miles […]
CSCMP’s New England Roundtable recently visited Walgreens’ New England distribution center near Hartford, Connecticut. Following a presentation by Scott Sylvester, the Distribution Center Manager, we received a tour of this highly-automated facility. The material handling systems in the DC are truly an amazing piece of engineering. However, even more amazing, is Walgreens’ track record in […]
Process manufacturing plants have distributed control systems (DCSs) that are connected to plant floor sensors that monitor pressure, heat, temperature, etc. These sensors are used to regulate processes. For example, flow measurements can be transmitted to the DCS; when the measurement reaches a certain point, the controller instructs a valve to open or close. These […]
The New England Roundtable of CSCMP recently organized a tour of Walgreens’ Northeast Distribution Center (DC). What an amazing facility! Because I live in a Boston suburb and the DC is in Connecticut, I used MapQuest to get turn-by-turn directions and it told me that the trip would take just under 2 hours. I made […]
Poor hospital management is one reason why health care costs in the U.S. are the highest in the world. According to a 2009 Boston Globe article by Scott Allen, “hospitals have overtaken prescription drugs as the main reason insurance bills go up each year.” But better logistics practices, particularly in the area of how patients […]
I recently read a great business school case study by Terry Tremwel (Walton College of Business, University of Arkansas), Dan Lynch (Eli Broad Graduate School of Management, Michigan State University), and Jim Crowell (Walton College of Business, University of Arkansas) called “Phoenician Phoods, Breakfast Cereal Manufacturer and Distributor.” The case focuses on a business executive […]
Joe Pajer, COO of Vocollect, and Tom Murray, Vice President of Product Management, recently briefed me on their idea that logistics is entering the “voice-enabled warehouse era.” According to a study they commissioned, voice solutions have only penetrated about 10-15 percent of the warehouses it is well suited for, a percentage that I can’t verify […]
Supply chain risk management solutions must encompass process, content, and connectivity. Even before the economic downturn, large enterprise software vendors like SAP and Oracle had begun to introduce Governance, Risk, and Compliance (GRC) solutions in response to a growing customer requirement: the ability to respond to risks more efficiently. Initially, these solutions were largely process […]
The ongoing developments in intelligent and flexible material handling systems, which are basically robots, continue to fascinate me. For example, automatic guided vehicles (AGVs) used to be fairly dumb machines that moved from point to point by following a preset trail of magnets in the warehouse floor. Humans loaded them at one end of the […]
Here at ARC Advisory Group, we are well known for our research and expertise on supply chain and automation technologies used by the process industries. I’ve been waiting for one of our process industry gurus to write something about the Gulf oil spill and Larry O’Brien finally did last week in “How the Gulf Oil […]
My colleague Asish Ghosh has retired—for the second time. Ten years ago he announced his first retirement, got his retirement party, and a few weeks later we called him back in to help us with a quick turnaround project. He then worked part time for another decade, retired again last week, and got his second […]
Tom Kozenski of RedPrairie (an ARC client) sent me a video case study about a WMS implementation at Cummins Filtration that went very smoothly because of good project management: avoidance of customization, RedPrairie and Cummins folks that worked together seamlessly, and role-based training. The benefits Cummins reported are what I would have expected for a […]
I watched a Walmart television commercial recently that linked its ongoing efforts to transport goods more efficiently with its private fleet to its efforts to benefit the environment, lower its operational costs, and improve its ability to offer lower prices to consumers (its price rollback program). I couldn’t find this commercial on YouTube or on […]
I attended the JDA user conference last week, FOCUS 2010 , which took place at Caesars Palace in Las Vegas. JDA completed its acquisition of i2 Technologies at the end of January, and what was most interesting to me was to see how the merger was proceeding. Historically, i2 and JDA have had very different […]
If you were to conduct a cost waterfall analysis of most manufacturers, you would find that their manufacturing-related costs are greater than their distribution costs. And in distribution, transportation-related costs outweigh warehousing costs. So, a one percent cost saving in manufacturing saves a lot more money than the same one percent improvement in warehousing. This […]
I was recently briefed by the executive leadership team of the GENERIX Group, a leading supply chain execution software vendor headquartered in France. One of its customers is Carrefour, the second largest retailer in the world. Carrefour is ramping up consolidation centers (CC) in Europe. The retailer currently has eight centers operating in France with […]
RedPrairie, an ARC client, held its annual user conference, RedShift 2010, in Orlando last week. It was the company’s largest user conference ever. The two biggest news items from the event were the CEO’s explanation for why RedPrairie was acquired earlier this year by New Mountain Group and RedPrairie’s acquisition of SmartTurn, a software-as-a-service (SaaS) […]
What Key Performance Indicators (KPIs) should your company use to benchmark its supply chain capabilities? Another way to think about this question is to ask: What do our customers want? What will cause them to buy more goods from us? What will they pay more for? Your customers should be grouped into cohesive channels with […]
Supply chain managers often bemoan increasing regulation, and how new regulations or overly stringent oversight increases supply chain costs and makes their day-to-day jobs more complex. But as we have seen in the news recently, failures in government oversight can increase our supply chain risks. The oil spill in the Gulf of Mexico is currently […]
I’m just back from Manhattan Associates’ Momentum 2010 User Conference. The theme this year was “Platform Thinking.” Manhattan, an ARC client, has been on a four to five year journey to bring its applications onto a common supply chain platform. Its warehouse management system (WMS) application was just added to the platform this year. The […]
More flexible forms of warehouse automation are emerging. One example of this is real-time location forklift automation—i.e., forklifts equipped with a real-time location system that allows drivers to proceed to a specified location and pick up (or put down) a load without the need for the driver to scan the location to prove that they […]
The folks at Tecsys, a supply chain execution software vendor, sent me a whitepaper called Visual Logistics. The concept is simple: information displayed to warehouse workers on RF terminals should be more visual. Here is how picking information is typically displayed on a text-based RF terminal: With the traditional text-based approach, the operator scans a […]
The CEO and VP of Marketing of Airclic, a software-as-a-service provider of Mobile Resource Management (MRM) solutions, came in to brief us recently. One of the stories that caught my attention was how one of its customers, a waste collection company, uses the company’s solution. The problem the customer was experiencing was that its drivers […]
I’ve been waiting to hear how supply chains have been disrupted by the Icelandic volcano that is spewing massive amounts of ash into the atmosphere. For those of you have been in a cave over the past week or so, it turns out that the ash makes it dangerous to fly. As a result, most […]
When supply chain folks think about anti-counterfeiting in the pharmaceutical supply chain, we naturally think about bar codes and RFID. Those technologies have a role to play, but the requirements go far beyond the simple tracking that occurs in many other supply chains. My colleagues Janice Abel and John Blanchard have written an ARC Insight […]
I believe that one of the emerging trends that will differentiate leaders from followers in the consumer goods industries is that leaders will excel at integrating their demand management and replenishment processes with category management. Consequently, it benefits supply chain executives to better understand leading practices in category management. Supply Chain Digest recently aired a […]
I recently wrote about some of the thinking and core concepts behind achieving the lowest supply chain costs in a Direct Store Delivery (DSD) supply chain (see “Direct Store Deliveries and Lowest Total Supply Chain Costs”). Today, I will highlight how Coca-Cola Enterprises (CCE) has actually put these concepts into practice. I’d like to thank […]
An article in the Wall Street Journal last Thursday (“New Ways to Read Economy,” Cari Tuna, April 8, 2010) highlighted several emerging economic indicators, including diesel fuel sales. Improved systems for collecting and disseminating data makes it easier today to track diesel fuel sales. While the profitability of leading trucking firms has long been considered […]
Manhattan Associates (an ARC client) recently briefed us about its transportation management system (TMS). One of Manhattan’s large retail customers, who must remain anonymous, selected its TMS solution in part to help them more optimally manage dynamic inbound routings. As we wrote about last week in “Manufacturers Tackle Inbound Transportation,” many companies, especially retailers, have […]
From a supply chain perspective, it often makes sense to have the warehouse work harder, so that downstream recipients of shipments don’t have to work as hard. If certain tasks can be done more cost efficiently in the warehouse, then those tasks should be performed there. However, there are instances where the warehouse can actually […]
Last month, antidepressants worth $75 million were stolen from an Eli Lilly warehouse in Enfield, Connecticut. According to an article in the Spokesman-Review, “the thieves cut a hole in the roof, lowered themselves into the building on ropes, disabled the alarm system and stole enough drugs to fill a tractor-trailer. The stolen pharmaceuticals included the […]
Since I am in the process of updating our Transportation Management Systems (TMS) Worldwide Market Outlook study, I was recently briefed by INTTRA and CargoSmart, two providers of ocean tendering and execution solutions. INTTRA is a privately-held company headquartered in New Jersey with more than 270 professionals located in eleven countries. The company offers the […]
I received a press release earlier this month from AspenTech (an ARC client) claiming that its customer Samsung Total Petrochemicals expects more than $5 million in annual savings after implementing one of its solutions. This claim caught my eye not only because of the size of the savings, but also because it’s rare for supply […]
The logistics industry is obviously interested in what sorts of taxes might be applied to fuels that emit carbon dioxide (CO2). Whatever laws are enacted will depend partly on the public’s opinion on these issues. Recent surveys show somewhat contradictory reactions in the American public as to whether green house gases are causing global warming, and […]
We were briefed a few months ago by BabbleWare, a new entrant to the Supply Chain Execution (SCE) market. BabbleWare sells warehouse management, manufacturing execution, and mobile execution applications. It offers both software-as-a-service (SaaS) and license pricing. BabbleWare’s solution integrates to paper-based systems (as well as systems that generate telnet/terminal emulation, XML transactions, and even […]
Company annual reports typically contain a letter from the CEO or Chairman. Many of these letters are boring and filled with half truths. There is one exception: Warren Buffet’s annual letter to Berkshire Hathaway shareholders. His letters are eagerly awaited by the financial community because they are funny and insightful. His most recent letter came […]
The traditional definition of a private fleet is a fleet of vehicles owned by a company to conduct business. When supply chain folks hear the term they tend to think of a fleet of large trucks with trailers hauling goods from the manufacturer’s distribution center (DC) to the retailer’s DC. But other types of fleets […]
It is still a tough economy out there, with unemployment in the U.S. still hovering near 10 percent. Where should a young person interested in a supply chain management career look for a job? My top two choices: Bentonville, Arkansas and Geneva, Switzerland. Bentonville is where Walmart is headquartered. But the jobs there are not […]
There is a whole ecosystem surrounding the logistics software market. Part of the reason some logistics software companies thrive and others fail is that some of them do a better job of tapping into this ecosystem and leveraging it to create advantages for themselves in innovation, marketing, and sales. Here are the key classes of […]
In an article last Thursday, The Wall Street Journal announced that the Coca-Cola Company was nearing a deal to buy the bulk of its largest bottler, Coca-Cola Enterprises. This was interesting news to me because the acquisition, like PepsiCo’s deals to buy its two biggest bottlers, The Pepsi Bottling Group and PepsiAmericas, was driven in […]
I recently spoke with Ralph Rupert, Director for Unit Load Design at Virginia Tech. If you are not familiar with what a unit load is—I must confess, the term was new to me too—a unit load is “a single item, a number of items, or bulk material which is arranged and restrained so that the […]
“Are people who travel in town cars and on corporate jets different—on a psychological level—from you and me? Does the availability of luxury goods ‘prime’ individuals to be less concerned about or considerate toward others?” The answer to these questions seems to be yes, based on research conducted by Roy Y.J. Chua of Harvard Business […]
As I’ve mentioned before (here and here), I’ve been researching the ROI associated with consumer goods (CG) companies using downstream data (e.g., POS, store level inventories, and DC-to-store shipments). One of the conclusions that I have reached is that Category Managers get a better ROI from their investments in this area than other consumer goods […]
I’ve been interviewing supply chain executives at consumer goods manufacturers to learn how they are using downstream data. A key focus area for these executives is using this data to improve the accuracy of their demand forecasts. A couple of the executives I interviewed raised an interesting point about forecasting that I don’t remember coming […]
A few weeks ago, I had a face-to-face conversation with an executive from a consumer electronics accessories manufacturer. Since January 2007 this company has implemented five Oracle supply chain solutions: Demantra Demand Management, Oracle Advanced Supply Chain Planning (ASCP), Global Order Promising, Oracle Inventory Optimization (IO), and the Oracle iSupplier Portal (note: Oracle is an […]
I’ve been researching the ROI associated with consumer goods (CG) companies using downstream data (e.g., POS, store level inventories, and DC-to-store shipments). As part of this research, I recently spoke with a supply chain director at a very large CG company who asked, “Why can’t my supply chain team think like my category managers?” A […]
At the end of January, two RFID suppliers announced that the European aircraft manufacturer Airbus will be using RFID tags to track thousands of components and parts for the A350 XWB aircraft models. Airbus had previously announced that if a part is serialized, repairable, and replaceable, it would require either an RFID tag or a […]
Every once in a while it is interesting to conduct an internet search on the phrase “supply chain profits.” Here are two interesting stories from the fourth quarter of 2009 that I uncovered. In a Wall Street Journal article by Ilan Brat and Anjali Cordiero published in September, supply chain initiatives were credited with helping […]
Toyota, the company that invented the Toyota Production System and brought lean manufacturing techniques to the world’s attention, is one of the most respected names in Supply Chain Management. But over the past few weeks, Toyota has recalled about 9 million vehicles worldwide due to problems related to accelerator pedals, and last week the company […]
The Perfect Order is often recognized as the highest level of customer service. It can be defined in different ways, but the traditional definition includes four elements: order completeness, timeliness, condition, and documentation. In other words, to be considered perfect, an order must be delivered to the customer’s distribution center (DC) complete, on time, free […]
At the end of every year, Walmart holds a meeting for the investment community. Because so much of Walmart’s core strategy revolves around excellence in supply chain management, I always enjoy hearing about the company’s plans. What interested me the most this year was Walmart’s multichannel strategy. Here are some key points from Raul Vazquez, […]
I recently spoke to the folks at BabbleWare, a new software vendor with a low-cost warehouse management, manufacturing execution, and mobile field-based execution applications. BabbleWare mentioned that one of its WMS clients is actually experimenting with using the iPhone as their barcode scanning application. Are they crazy? Yes, you can buy a barcoding application at […]
Oliver Williamson, a Professor Emeritus at the University of California Berkley and co-recipient of the 2009 Nobel Prize in Economics, published a paper in April 2008 titled “Outsourcing: Transaction Cost Management and Supply Chain Management” in the Journal of Supply Chain Management. Williamson’s area of expertise is transaction cost economics. The paper is far more focused […]
We are coming up on February 1st 2010, the day that Walmart starts enforcing the penalties associated with its Supply Chain Reliability Program. If you are not familiar with the program, below are excerpts from the letter that Walmart sent to suppliers on Oct. 15th, 2009. Dear Valued Supplier, Walmart and Sam’s Club are continually […]
In 2006, I interviewed 22 companies that had implemented or upgraded a Warehouse Management System (WMS) solution at a single site or across many sites. These interviews clearly suggested that the architecture of the solution affected its Total Cost of Ownership (TCO). I looked at the type of WMS solution that was implemented—traditional configuration versus […]
The focus for Plug-In Hybrid Electric Vehicles (PHEVs) has been passenger cars, specifically cars used for commuting. General Motors, for example, plans to come out with the Chevy Volt in 2011. The idea is that you plug in the car overnight and then you can drive it for up to 40 miles. After that, the Volt […]
I’ve been writing about the Demand Signal Repository (DSR) market a fair bit recently (see, for example, “How to Best Describe Demand Signal Repositories”). DSR solutions leverage a variety of different types of downstream data, including POS data, to power more robust and dynamic forms of replenishment. As the saying goes, “everyone talks about the […]
My ARC colleague Janice Abel told me a story recently that is making me question the safety and efficacy of prescription drugs purchased online. Janice was visiting her stepfather who had been away from home for a long weekend. When he returned and went out to the mailbox, on a hot summer day in the […]
The Retail Industry Leaders Association and the supply chain faculty at Auburn University recently published a report called “The State of the Retail Supply Chain.” The research results are based on interviews with Senior Vice Presidents, Vice Presidents, and Directors from 45 large retailers headquartered in North America, including many retail organizations respected for their […]
I recently spoke with Mike Spindler, the CEO of ShelfSnap, about the company’s entry into the “shelf-level collaboration” arena. (Quick aside: As I mentioned in a previous posting, I prefer the term “Shelf-level Collaboration Solutions” over Demand Signal Repository (DSR) products because I believe it’s both more accurate and evocative.) ShelfSnap is in start-up mode, […]
Angélique Moon, Director of Product Management for Consumer Goods at Oracle, briefed me recently on Oracle’s Demand Signal Repository (DSR) solution. At the end of the presentation, Ms. Moon and I bemoaned the fact that the vocabulary used to describe these types of products is not very good. Shortly after, I had a similar conversation […]
Achieving robust forecasts is very difficult, if not impossible, in some industries. This is particularly true for companies in the semiconductor industry, which is very volatile because of its speed of innovation. Moore’s Law describes a long-term trend in the history of computing hardware, in which the number of transistors that can be placed inexpensively […]
“Focus on executing to Key Performance Indicators (KPIs).” This is the key piece of advice for navigating the recession from a top supply chain executive at one of the world’s largest consumer electronics firms (due to confidentiality, I can’t disclose the name of the company). The top-level supply chain KPIs at this company include cost, […]
Google is shaking up the GPS and navigation industry with some recent announcements. For example, Google is developing a map database to compete with the routing and navigation maps provided by NAVTEQ and Tele Atlas. The company also announced it is offering a free turn-by-turn (TBT) navigation app with its Android 2.0-based smart phones (see […]
Earlier this year, some of my colleagues here at ARC wrote a Strategic Report titled “Capital Expenditure Survey 2009” (available to ARC clients only). The report got me thinking about the differences between how hardware and software are expensed, and how those differences affect a logistics executive’s annual budget. I talked to executives at some […]
“Oil is becoming increasingly difficult and costly to recover, and the problem of managing the supply chain and profits has become more complex than ever. After weathering the economic downturn, the industry must boost capacity for future demand, and keep a close eye on the economics of oil and gas production.” So wrote my colleague […]
Last year, I interviewed several warehouse managers in the chemical industry to learn more about their operations and how they are using supply chain execution (SCE) technology. Chemical manufacturers, distributors, and logistics service providers (LSPs) all operate chemical warehouses which differ in complexity. At one end of the spectrum are distributors (or LSPs that handle […]
Three years ago, Dow Chemical, the largest chemical company in the world, began a journey to explore the usefulness of RFID to enhance security, improve customer satisfaction, and reduce costs. When Dow began to explore this new and still maturing technology, it put together a thorough set of processes to facilitate the analysis and adoption […]
In my “What Causes Shelf Out-of-Stocks?” posting last week, I reviewed some research conducted by Walmart on the major causes of shelf-level out-of-stocks. One reason, occurring about 20 percent of the time, is phantom inventory. Phantom inventory occurs when the store system shows inventory available but none really exists. It also occurs when the system […]
Once upon a time there was a global, medical products company that was very unhappy with the way it was treating its customers in Asia. The company’s main customers are hospitals that use its products in emergency room surgeries. Not surprisingly, its customers wanted a high level of product availability. But this was a problem […]
Shoplifting is at record levels ($115 billion from July 2008-June 2009) and this is causing supply chain problems, not only for the retailers, but also for consumer goods manufacturers. The Centre for Retail Research (CRR) published its annual Global Retail Theft Barometer report on November 10th. CRR interviewed 1,069 large retailers with total revenue […]
The other day I received a package from Manhattan Associates (an ARC client) via Priority Mail. I had to use a knife to cut through the shipping tape, and when I opened the package there was a pretty little blue box, very Tiffany-like, inside with a white ribbon on it. I had to use scissors […]
At many companies, the vision statement is comprised of empty words. Not at IKEA, where the company has a clear vision and its various functions work together to support its distinctive value proposition. IKEA, the world’s largest home furnishings retailer, has a vision of providing “well designed, functional home furnishings [at] prices so low that […]
We all remember the story of Goldilocks and the 3 Bears, where one bed was too soft, one was too hard, and third was just right. When it comes to warehousing technologies for food distribution, I see the same thing. In grocery, most store shipments are composed of mixed-SKU pallets. The layout of a grocery […]
Task interleaving is an advanced productivity practice enabled by leading warehouse management systems (WMS) with task management engines. Task interleaving is designed to reduce deadheading—i.e., when a worker, for example, picks products and drops them off at a dock and then returns to the picking area without performing any useful tasks along the way. In […]
I recently spoke with key members of Ford’s service parts supply chain and IT organization in North America to better understand how the company is using SAP’s end-to-end service parts supply chain solution (SAP is an ARC client). Ford and Caterpillar Logistics, as key customers and partners, have helped SAP to build out this solution, […]
In August, Fortune magazine published an article titled “ExxonMobil: Green Company of the Year” by Christopher Helman (ExxonMobil is an ARC client). The article argued that “The engineering solution to the matter of carbon in the atmosphere [is to] drill for natural gas. Per unit of energy delivered, methane releases 40% to 50% less carbon […]
It is getting harder and harder for software vendors to innovate in supply chain management (SCM). I went to Oracle OpenWorld (OOW) last week expecting to see incremental improvements in many of its SCM applications (Oracle is an ARC client). Instead, I was blown away by what I saw and heard in one key area: […]
What would a Global Trade Management (GTM) solution that took a lifecycle approach to trade compliance look like? John Wainwright, the Vice President of Customs Compliance at Leggett & Platt, has an insightful answer to this question: Trade compliance processes should mirror a customs audit. Leggett & Platt (L&P) is a global, diversified manufacturer of […]
Barcoding has become ubiquitous in supply chains that start at a manufacturing facility and end at a business or retail customer. Voluntary and regulatory initiatives are now extending barcoding further up the supply chain, to farms that grow fresh fruits and vegetables. The purpose of these initiatives is to support the reverse supply chain—i.e., recalls […]
Back in 2000, my colleague Greg Gorbach introduced a Collaborative Management Model (CMM) to help companies think through the interdependencies among a company’s various departments and locations, as well as partner networks, when seeking to leverage internet technologies to enhance their competitive position in the market. At the time, the big payoff from collaboration came […]
The most entertaining, and perhaps most acute, business book that I’ve read in several years is “The Management Myth: Why the ‘Experts’ Keep Getting It Wrong” by Matthew Stewart (you can read a short book review by Andrew O’Connell at HBR online). Matthew is a cynical ex-consultant who reports on the methods consultants use to win […]
One of the most popular articles ever published by Supply Chain Management Review is “The 7 Principles of Supply Chain Management” by David Anderson, Frank Britt, and Donavon Favre. It was published more than ten years ago, but it is still a good read. I recently reread the article and I was struck by how […]
For the past five years Terrapinn has organized an event called SCM Logistics World in Singapore. The event, which is taking place this week, is focused on supply chain management in the Asia Pacific region. Although I could not attend this year, I served as one of the judges for their Supply Chain Excellence award. […]
Editor’s Note: This posting is a follow up to the posting Steve Banker wrote last week which contained some inaccurate statements about the GS1 Canada Product Recall service. This posting provides a more accurate and detailed overview of the service. GS1 Canada Product Recall is a subscription-based service which provides a standards-based communication tool enabling […]
Audiovox Corporation is a publicly-traded company (NASDAQ: VOXX) headquartered in Hauppauge, New York. The company generated about $600 million in revenues in its last fiscal year. Audiovox started in the car radio business but its product portfolio has expanded over the years to include satellite radio, vehicle security, remote start and other mobile products. The […]
In the last annual survey done by WERC, the average warehouse’s turnover was between 9.4 and 15 percent. This is too high, and turnover is expensive. How can companies perform better in this area? Could the composition of the workforce make a difference? In recent research conducted by the Pew Research Center, they comment that […]
The benefits from Yard Management Systems (YMS) are driven by their ability to enhance five key processes within the yard. Here are some of the key benefits in those different process areas: On-Line Dock Door Appointment Booking A best practice, which is more common in Europe, is to have carriers book delivery appointments within a […]
Editor’s Note: The posting below contains some inaccurate information about GS1 Global Traceability Standards (see comment posted below by John Keogh, Senior Vice President EPCglobal Canada and Traceability). A follow up posting has been published which provides a more accurate and detailed overview of the GS1 Canada Product Recall service. GS1, the global organization responsible for […]
When you’ve been in a discipline for a long time, you forget sometimes that not everyone is as immersed in a topic as you are. I was reminded of this when I was asked to participate in a webinar on warehouse management system (WMS) task management, slotting optimization, and labor management with Tom Kozenski, VP […]
I wrote an article for Supply Chain Management Review earlier this year called the Tax Efficient Supply Chain. If you have a North American based private fleet, part of having a tax efficient supply chain is making sure you don’t overpay on your International Fuel Tax Agreement (IFTA) taxes. IFTA is an agreement among all […]
I received a question a while back from a client, a supply chain director at a process manufacturer. In the process manufacturing industry, storage often does not involve warehouses that store cases and pallets; it involves putting various types of liquids, at various temperatures and pressures, in storage tanks. These tanks might store raw materials […]
A few months ago, a client asked me to help him put together a short list of best-of-breed warehouse control system (WCS) vendors. Here is the problem he faced: his company uses a warehouse management system (WMS) that worked well when it was initially implemented. Over time, the company added various material handling systems, each […]
I recently had a discussion with Gary Petty, President of the National Private Truck Council (NPTC), and Gary Girotti, Vice President of Chainalytics’ transportation practice, about private and dedicated fleets. Why do companies have a private fleet? According to a survey by NPTC, eighty nine percent of the respondents cited “to achieve better customer service […]
Last month, I wrote a posting on how Walmart is reducing its SKU selection to improve merchandising and reduce complexity. In response, Kate Vitasek, founder of Supply Chain Visions, sent me an article she wrote with Eric Tinker and Shawn Bhimani called “Rationalizing SKU Introductions.” In her email to me, Kate commented that we should […]
IBM’s global trade operations are massive in scale and scope. The company conducts business in 170 countries and moves about $25 billion worth of goods across borders. It ships about 2 billion pounds of goods per year globally (78,000 products with 2 million configurations) which translates into 500,000 customs declarations annually. IBM also conducts cross […]
When we think of a supply chain, we tend to think of a chain of activities that starts with sourcing, then manufacturing, and ends with goods arriving at a store. When we think of a logistics fleet, we tend to think of big trucks hauling goods between plants, distribution centers, and stores. Otis Elevator Company […]
Last Friday, President Obama signed into law a $2 billion extension to the “Cash for Clunkers” program, after the initial $1 billion in funding was consumed in the program’s first week. The Consumer Assistance to Recycle and Save (CARS) program, the official name of this legislation, offers consumers up to $4,500 to trade in gas […]
When Danny Boeykens, a partner at MÖBIUS, a European boutique consulting firm, read my posting on “Supplier Risk Management and the Automotive Supply Chain,” he pointed me to a Financial Times article by Richard Milne that provides a European perspective on this problem. As stated in the article, “When Edscha, a German manufacturer of sun […]
I recently wrote a posting about Walmart’s Project Impact initiative and how it enables beneficial synergies between merchandizing and the supply chain (see “Walmart’s ‘Win-Play-Show’ Assortment Strategy”). On the merchandizing side, Walmart is ending up with stores that are less cluttered and more customer friendly, and on the supply chain side, these stores are carrying […]
Many private fleets have to justify their existence versus for-hire carriers every few years. Better service and cost competitiveness are the key justifications for keeping a fleet. A private fleet manager is often responsible for both operations (the drivers and fleet planners) and fleet maintenance. Achieving strong performance on the cost-per-mile-driven metric requires not just […]
I came across a white paper from PriceWaterhouseCoopers (PWC) called “Seizing Opportunity: Linking Risk and Performance”. In one place, the paper highlights a “global automotive manufacturer” that was “experiencing significant losses due to a key risk in its supply chain: supplier bankruptcies.” The company faced the direct costs of those failures, as well as the […]
I recently received a newsletter from Lehigh University’s Center for Value Chain Research that showed the American Marketing Association’s (AMA) definition of “marketing” right next to the Council of Supply Chain Management Professionals (CSCMP) definition of “supply chain management.” Here are their definitions: AMA – Marketing is the activity, set of institutions, and processes for […]
The National Private Truck Council (NPTC), a U.S. trade association focused on the interests of companies with private fleets, conducts an annual Private Fleet Benchmarking Survey. This survey has three goals: (1) to validate private fleet performance based on comparative peer data; (2) identify areas of improvement and opportunity; and (3) identify the significant trends […]
Eric Peters, the CEO of TrueDemand Software, was in to brief us recently. During our conversation, Eric commented that many folks believe Walmart is performing well financially because low-cost retailers tend to have a competitive advantage during a recession. However, he believes Walmart’s recent gains in logistics efficiencies are also contributing to the company’s financial […]
Looking for some good ideas on how to improve your private fleet’s utilization or how to save money on fuel? In 2004, the Environmental Protection Agency launched SmartWay, a program (and brand) that identifies products and services that reduce transportation-related carbon dioxide emissions. As part of this program, they annually announce the SmartWay Excellence Award […]
I was briefed recently by Vocollect, a leading provider of voice recognition for warehouse picking. Vocollect is looking to expand from providing voice solutions for the warehouse to also providing solutions to support retail store operations. One of Vocollet’s clients, Cabela’s, a leading specialty retailer of hunting, fishing, camping and related outdoor merchandise, has logistics […]
Earlier this week, a colleague brought to my attention a company called Planalytics. Actually, at a supply chain conference several years ago, I attened a presentation by a manufacturer that was attempting to use Planalytics Business Weather Intelligence in their supply chain planning processes. At the time, weather-driven demand planning seemed interesting, but not ready […]
I’m kicking off a research project on fleet management planning solutions for companies that operate private fleets. If you conduct an online search for “fleet management” you’ll find three distinctly different types of solutions: routing and scheduling; telematics; and fleet maintenance solutions. Telematics solutions are currently more focused on execution than planning, but their real […]
Ever wonder, while you’re filling up your car with gasoline, about all the supply chain steps involved in getting fuel to that pump? The petroleum supply chain (which includes not just gasoline, but all sorts of petroleum-based products) is not something most people think about, and it doesn’t get much attention in the trade press, […]
My colleague Adrian Gonzalez and I are both fans of network-centric, software-as-a-service (SaaS) transportation management systems (TMS). We see advantages in terms of on-boarding carriers and other trading partners, data quality management, and the potential for benchmarking (see “More Questions About Software-as-a-Service“). But as I think more about Duncan Watts’ “Too Complex to Exist” article […]
I read an article by Bob Trebilcock in Modern Materials Handling titled “Automation: Grocery giant Kroger changes the distribution game,”and I was amazed by what Kroger has accomplished, and the risks the company has taken. Kroger implemented an automation system “that can receive and put-away full pallets, then break them down and rebuild them into […]
Professor Barry Keating of Notre Dame, coauthor of the leading college textbook on business forecasting (which actually has more buyers from businesses than from college students), was gracious enough to talk to me recently. The topic was using macroeconomic data to adjust forecasts down for coming recessions, or up when economies begin to grow again. […]
I’m currently conducting some research on Fleet Management, so I was delighted to find a free, downloadable best practice report on this topic. Until I read the first page. Then I knew it was junk. ARC produces best practices reports, and I have written a few of them myself. Done right, these reports can provide […]
A colleague sent me an article from McKinsey called ‘Power Curves’: What natural and economic disasters have in common by Michele Zanini. Coincidently, I read a different article that made similar points (“Too Complex to Exist” by Duncan Watts, the chief scientist at Yahoo! Research). I found both articles interesting because they explain to senior […]
While conducting an Internet search, I came across a course offered by The Quest Team to sales people in the semiconductor industry. The course is called “Combating Aggressive Supply Chain Management: Strategies and Tactics for Leveling the Playing Field”. Here is part of the course description: “The SEM industry has been hit with increasingly aggressive […]
“I’m afraid my supply chain software vendor might go out of business. What should I do?” I was asked this question recently by one of my clients. The vendor in question is a rather small supply chain execution (SCE) software provider, with estimated annual revenues of less than $20 million. My client knows that the […]
I am doing some research on “Supply Chain Management in Times of Turbulence” and one of my premises is that firms with a robust strategic planning process are better equipped to deal with large, unexpected events, like the current global recession. What does a robust strategic planning process look like? How does strategic planning integrate […]
I’ve heard that the Chinese symbol for “crisis” is composed of elements that signify “danger” and “opportunity.” A professor of Chinese language and literature at the University of Pennsylvania says this is untrue, which is too bad because it is such a good story. It is also exactly the situation that GM finds itself in. […]
Fred Berkheimer recently retired from Unilever after a 29 year career. For the last ten years, he was the Vice President for North American Logistics with responsibility for managing both internal logistics and logistics outsourcing relationships. Along the way he worked as a process engineer, in packaging, in facilities management, and as a factory manager […]
So says Peter Skurla, the man credited with coining the phrase “Sales & Operations Planning” and a principal at Oliver Wight, the consulting organization most strongly associated with expertise in S&OP. Over my years of covering supply chain management, several companies have told me how helpful “Ollie Wight” has been in helping them get to […]
I generally leave the discussion of political issues that affect logistics to my colleague Adrian Gonzalez. But one issue that I have been tracking is the “reset economy,” the idea that once we emerge from this recession, certain industries may not bounce all the way back. In other words, they may not have the same […]
Companies that outsource manufacturing, logistics, call centers, IT support, and various back office functions can be better equipped to ride out a recession, particularly if the payments are transaction based. Less demand means fewer transaction fees associated with supply chain services. These companies have minimized their fixed overhead costs, and their warehousing, transportation, and manufacturing […]
About a year and a half ago, I completed a report on the ROI and best practices associated with Voice Recognition solutions for the warehouse. The price for voice systems has been dropping in recent years, as more companies use nonproprietary, mobile computers from companies like Motorola. These computers provide the local computing power for […]
When I think of a warehouse, I visualize a facility with racks. But in industries that sell commodities (e.g. fresh produce), “bulk” warehouses without racking are more prevalent. What you are likely to see in these warehouses are painted lines on the floor where pallets are stacked. Oftentimes, a worker has to move a stack […]
I’ve argued that for various macroeconomic reasons, demand may not bounce all the way back after the recession ends (see “The Reset Economy“). I’ve also stated that if this is the case, then it would be valuable for companies to get some advance warning about future demand levels, and that using economic data as a […]
On April 22nd RedPrairie issued a press release announcing that it was adding “flowcasting” to its product suite. Despite reading the press release carefully, I couldn’t fully grasp what “flowcasting” was. Fortunately, RedPrairie’s management team visited us the next day and we discussed this new solution. It turns out that “flowcasting” is synonymous with “demand […]
I recently wrote a piece called “The Reset Economy” where I argued that for various macroeconomic reasons, demand may not bounce all the way back after the recession ends. Consequently, many manufacturers may end up with more capacity than they need. I believe this is the biggest supply chain problem many companies will confront over […]
Yesterday, I talked about how I’m a fan of the “moment of truth” concept, and I highlighted how we have gone through three phases in trying to solve the “out of stock” problem, but that a new phase is emerging. This new phase, which has begun only recently at some leading manufacturers, includes making a better […]
I’ve always been a fan of Procter & Gamble CEO A.G. Lafley’s two moments of truth concept. The first moment of truth is what a consumer sees on the store shelf; the second is what the consumer experiences after they have bought the product. Today, I want to focus on the first moment of truth, […]
Across a wide range of supply chain projects and processes, poor data quality is a recipe for failure. Today, I’m focusing on dimensional data. Do you have accurate weight and dimensional data for your products? For the cases, inner packs, and pallets those products are shipped in? While data quality is one of the least […]
I recently wrote a piece called “The Reset Economy” where I argued that for various macroeconomic reasons demand may not bounce all the way back after the recession ends. Consequently, there will be too much capacity in many industries. I believe this is the biggest supply chain problem many companies will confront over the next […]
More than six years ago, WalMart announced a new EPC RFID mandate. RFID was going to revolutionize the supply chain, leading to better visibility for suppliers and reduce out-of-stocks for retailers. That was the vision. However, when I interviewed twenty-four of the top 100 suppliers that were mandated to participate, I heard a different story. […]
ARC recently published my new Warehouse Management Systems (WMS) Market Outlook study. In a previous Logistics Viewpoints article, I highlighted the fact that the largest WMS suppliers continue to grow as the market shrinks. However, despite that, I believe that these leading WMS suppliers have a strategic hole in their supply chain execution portfolio that […]
“This economic crisis doesn’t represent a cycle. It represents a reset,” according to Jeff Immelt, the CEO of General Electric. “It’s an emotional, social, economic reset,” which will lead to greater government involvement in the economy and business affairs. For Steve Ballmer, the CEO of Microsoft, the problem with the economy is that it grew […]
I picked up this week’s BusinessWeek and took a glance at their cover story, “The BusinessWeek 50: the Best Performers.” As I scanned the list of the top 50 financial performers, I was surprised to see a logistics company, Expeditors, included on the list (they were number 28). I’ve always viewed logistics as a leading […]
When it comes to Logistics Service Providers (LSPs), it is clear that FedEx and UPS have technology-driven value propositions. There is no other way that they could economically and efficiently pick up and deliver large volumes of packages each day without the aid of technology. But technology innovation is not just limited to very large […]
I’ve come across three logistics products and services in recent months that intrigued me. The first product is called the “TruckTrainer Warehouse on Wheels System” by Demountable Concepts. Since a picture is worth a thousand words, I recommend that you watch this video on Demountable’s website to fully understand what this product/system is about. Briefly […]
I recently read an academic paper from the WHU-Otto Beisheim School of Management called “3rd Party Logistics Providers’ Role in Replenishment” that I liked. The paper contained good information, but it was also a bit long and kind of dense (although not nearly as inaccessible as most academic articles). I realized after reading it that […]
Over the past two months, I’ve been interviewing Warehouse Management Systems (WMS) vendors, as I update our annual Warehouse Management Systems Worldwide Outlook study. Many vendors told a similar story of woe about 2008. The year started well, and then selling cycles began to lengthen in the third quarter. Many suppliers, particularly mid-size and smaller […]
The desire to improve service is the main reason many companies are investing in information technology (IT). Achieving this goal is very difficult without a robust Integrated Business Planning (IBP) process, formerly known as Sales & Operations Planning. The goal of sales and operations planning is to achieve high service levels by effectively balancing demand […]
When it comes to IT architecture, you might hear acronyms like SOA (Service Oriented Architecture) or BPM (Business Process Management). But I’ve often believed the most applicable acronym was MEGO – My Eyes Glaze Over! However, if you are contemplating buying a Warehouse Management System (WMS), the sad truth is that architecture does matter. So, […]
Every year since 1996, Professor John Langley of the Georgia Institute of Technology has published a report called “The State of Logistics Outsourcing” that highlights trends and issues in third-party logistics. Over 1,600 logistics executives participated in last year’s survey. According to the report, “One area warranting particular scrutiny is a 3PL’s planned technology investments: […]
A few weeks ago, my colleague Adrian Gonzalez wrote a posting titled “Supply Chain Risk Management Gains Importance.” In it, he cites a Financial Times article that discusses how interest in enterprise risk management has increased over the past two years. I’m not sure I agree with that finding, at least when it comes to […]
How does your company think about ROI? Your answer may largely determine how much distribution center automation your company is willing to invest in. First, some quick definitions: My definition of “manual warehouses” is synonymous with “man-to-goods” warehouses, where workers move to a pick location, pick the goods, and then move to the delivery dock. […]
I hate multi-tasking. Give me one task at a time, and sufficient time to accomplish it, and I’m fairly happy. But that rarely happens. Even so, my work life has to be easier than a warehouse manager’s. Their main job, of course, is to make sure that customer orders are fulfilled accurately and on-time every […]
I came across a working paper recently from the Harvard Business School called “Goals Gone Wild: The Systematic Side Effects of Over-Prescribing Goal Setting.” Although hundreds of studies have shown that setting specific, challenging goals can drive behavior and boost performance in powerful ways, the authors of this paper argue that goal setting has been […]
Last month, HighJump issued a press release that really caught my eye. It wasn’t so much the headline (“HighJump Software Offers Promotion Including Complementary ROI Assessment for Its Labor Management System”), but a sentence buried deep in the press release: “This special offer for HighJump Labor Advantage allows companies with constrained capital budgets to realize […]
Video game visualization technology has come to the Warehouse Management Systems (WMS) market. These new products and modules are not merely “slick” packages that are “nice to have” additions to a WMS solution. Whenever a software solution’s usability improves, new forms of productivity are enabled. The personal computer revolution, after all, was based as much […]
In a recession, cash is king. What can your supply chain team do to improve cash flow? What processes and technologies can help? The most obvious action is to lengthen payment terms with key suppliers. Finance may do this without informing supply chain managers, but this works against the mantra of establishing an adaptive, demand-driven […]
There was a terrific article in this month’s Supply Chain Management Review by John Ferreira and Len Prokopets from Archstone Consulting (“Does offshoring still make sense?”). The article highlights some key findings from a survey Archstone and SCMR conducted with thirty-nine senior executives from U.S. and European manufacturing companies. Among the interesting points highlighted in […]
I recently completed a study of the Supply Chain Planning (SCP)software market. In doing this study, I came across solutions that could not be cleanly classified as either Supply Chain Planning or Supply Chain Execution. First, a quick background on supply chain planning and execution solutions. SCP solutions are typically based on optimization algorithms. I […]
There was a “let’s make a deal” brain teaser that appeared in the “Ask Marilyn” column in Parade magazine several years ago. Readers were asked to suppose they were a contestant on the television game show “Let’s Make A Deal.” The host tells you that there is a car behind one of three large doors […]
The transportation capacity crunch was the biggest topic of discussion at CSCMP’s annual conference. Every shipper I talked to, or heard present, admitted that while they had expected rising truckload costs this year, they had underestimated, often grossly, just how much these expenses would grow. Carriers have more choices on who they want to work […]