http://forums.industryweek.com Perspectives on innovative supply chain management strategies. en Fri, 20 Nov 2009 22:01:39 GMT vBulletin 60 http://forums.industryweek.com/IWImages/misc/rss.jpg http://forums.industryweek.com http://feeds.penton.com/~r/21stCenturySupplyChain/~3/quxvVsEvu1Y/showthread.php Fri, 20 Nov 2009 19:04:41 GMT I am attending Dreamforce 09 (http://www.salesforce.com/dreamforce/DF09/site/)in San Fran and trying not to get too caught up with the hype. And I don’t really have the expertise to “get” a lot of the technology stuff behind the “cloud” anyway. But it is really great to hear Marc Benioff, the CEO... I am attending Dreamforce 09 in San Fran and trying not to get too caught up with the hype. And I don’t really have the expertise to “get” a lot of the technology stuff behind the “cloud” anyway. But it is really great to hear Marc Benioff, the CEO of salesforce.com, make fun of the current software business model, especially amongst the ERP vendors. He referred specifically to the idea of charging 24% maintenance as a “tax”. Marc’s keynote from Thursday morning is well worth watching. You might ask “So what, Marc has being saying this for years?”

What is new is the development of enterprise applications on force.com to satisfy a variety of processes, including an ERP solution. And these are being developed in 3-8 months from initial concept to go-live. Vetrazzo developed production planning, inventory management, order management, returns, warrantees, and ton of other ERP capability in 4 months!! At a fraction of the cost that would have been required to purchase let alone implement SAP or Oracle. Even better, the CEO of Vetrazzo used to implement SAP systems, so he knows the full (in?) capabilities of SAP. OK, OK, so it does not have any accounting capability. But who cares, accounting packages are a dime a dozen and not related to your operational effectiveness. Plus there are any number of applications available on AppExchange for linking salesforce.com to accounting packages.

I can only imagine how SAP and Oracle execs are sweating. Even if we discount the technology story, the change in the business model is profound and is going to rock them to their foundations. In our own customer base, customers that a year ago flatly refused to go on-demand are now discussing the option with us. And these are companies over $20B!! Yes, that is a B as in billion, not an M as in million.

What do you think? What is the timeline before we see full ERP systems developed native to the cloud?

Trevor Miles is director, industry and applications marketing for Kinaxis, provider of the on-demand RapidResponse service that empowers enterprise and mid-market companies to continuously align demand and supply, thereby bridging the gap that exists between planning and execution. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9811 http://forums.industryweek.com/showthread.php?t=9811 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/8gbqMYwmIuU/showthread.php Wed, 18 Nov 2009 13:36:06 GMT Thought this was interesting…. MIT is conducting a global survey on Supply Chain Risks and Risk Management, and is looking for business and supply chain professionals within manufacturing, retail and distribution organizations to participate. If you complete the ~12-minute survey you can... Thought this was interesting….

MIT is conducting a global survey on Supply Chain Risks and Risk Management, and is looking for business and supply chain professionals within manufacturing, retail and distribution organizations to participate.

If you complete the ~12-minute survey you can sign up to get a copy of the results in early 2010 when it is completed.

Scope of survey includes:

• Gauging the importance of risk prevention, event response, control points
• Understanding risk and disruption frequencies and priorities
• Understanding what companies are doing to address risks
• Questions about the respondent’s region, country, languages spoken

, work setting, size of company, and type of industry.

To take the survey go to: http://tinyurl.com/RiskSurveySN1

To learn more about the project go to: http://ctl.mit.edu/RiskSurveySN1

I know I am certainly looking forward to the results!

John Westerveld is a product manager for Kinaxis, provider of the on-demand RapidResponse service that empowers enterprise and mid-market companies to continuously align demand and supply, thereby bridging the gap that exists between planning and execution. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9721 http://forums.industryweek.com/showthread.php?t=9721 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/WEqQskcHlVc/showthread.php Tue, 17 Nov 2009 14:15:47 GMT For an interesting read, check out: http://brainstormtech.blogs.fortune.cnn.com/2009/10/23/big-software-has-duped-us-for-decades-part-i/ I have the privilege of speaking with multiple companies every day….and they are all struggling, particularly with their supply chain. They aren’t meeting... For an interesting read, check out: http://brainstormtech.blogs.fortune....ecades-part-i/

I have the privilege of speaking with multiple companies every day….and they are all struggling, particularly with their supply chain. They aren’t meeting their delivery commitments, their inventory is too high or they just don’t have enough visibility in their supply chain. There is an expectation out there that ERP systems will do everything for everyone in an organization and it is just not true. Yes, it is certainly a good financial transaction tool and some companies find their ERP systems to be very successful. However you then find out that they have spent millions of dollars to make that happen.

I understand why a CIO of a company would want to have all of their business solutions on one ERP platform, but at what cost and compromise?

What do the users need in their day to day operations? They need better tools designed for users and not transactions. Organizations are continually being challenged to do more with less. The common theme in the business is being overworked, constant stress, change and disruption.

People in Demand Management, Sales and Operations Planning, Customer Fulfillment, and Planning and Scheduling have a right to be heard. They don’t have the time to source out better solutions that will improve their efficiencies and performance. Do they know that there are solutions that can vertically integrate their supply chain, providing them visibility to other aspects of their operation in other parts of the world or with their partners? Do they know that they can test changing a demand that will instantly regenerate MRP and tell them where their gating material and capacity constraints are? Do they know that they can create their own reports rather than relying on a queue with the IT department?

It is up to the management of an organization to ensure that people are properly empowered to do their jobs in the most efficient manner possible. There are ways to solve these problems. Don’t wait until it is too late to address these issues. Look for disruptive SaaS technology…to augment your ERP….without getting ‘duped’ as Roger Burkhardt, the author of the article so eloquently puts it.

What is your experience?

Carol McIntosh is a business consultant for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9671 http://forums.industryweek.com/showthread.php?t=9671 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/CMUJwheNpe4/showthread.php Fri, 13 Nov 2009 15:10:06 GMT At first, I was very confused when reading the title of this paper, "Do More with Less". There is nothing “less” about SAP. Maintenance costs are “more”, you need to buy “more” modules to satisfy the same business problem, implementations take “more” time, you need “more” hardware to run each upgrade, you need “more” consulting time for business process reengineering …

So shouldn’t the paper be titled “Do Less with More”? Just try running a Google search on “SAP overrun cost” and see the results. Or “SAP maintenance costs”.

Or, I thought, perhaps the paper is referring to the fact that SAP is getting “less” license revenue, so the paper is about SAP becoming more efficient itself? That just didn’t compute, so I knew I had to read the paper.

Well, I think I found my answer. Buried in the paper is the following statement:

“Management by spreadsheet is a reality, and it’s not going away any time soon”.

So finally, the admission that the functionality provided by SAP is simply not good enough so everyone has to resort to spreadsheets to get anything done. And in a paper sponsored by SAP. Wow.

Douglas Colbeth is CEO of Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9591 http://forums.industryweek.com/showthread.php?t=9591 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/5R4kaH76YrE/showthread.php Tue, 10 Nov 2009 14:07:14 GMT A couple of weeks ago, I was honoured to speak at a regional conference for PMAC (http://www.pmac.ca/) (Purchasing Managers Association of Canada) about supply chain risk management. At the end of my session, one of the attendees asked about one of the risk mitigation approaches I had suggested; ... A couple of weeks ago, I was honoured to speak at a regional conference for PMAC (Purchasing Managers Association of Canada) about supply chain risk management. At the end of my session, one of the attendees asked about one of the risk mitigation approaches I had suggested; developing alternate sources. The question went something like this; How come you are proposing developing alternate sources when companies are trending towards supplier consolidation? Actually, a very good question and one which points to one of the many dichotomies supply chain professionals deal with on a daily basis. While I answered the question off the top of my head that day, I’ve been thinking about the question since and think it deserves a more complete response.

The answer, like many for questions in life is: it depends.

Just to go on the record, I fully support the idea of supplier rationalization if it is done with the idea of improving the relationship with a smaller number of suppliers. The reason I put conditions on my support for this practice is because I have seen far too many cases where companies eliminate a large number of their supply base then continue with business as usual with the remaining suppliers. No improvement in communication, no sense of partnership, no added value.

On the other hand, companies that truly understand supplier rationalization understand that by reducing your supply base, you have the opportunity to improve communication and partnership with the remaining suppliers through more detailed forecasts, sharing of product plans and resolution of financial issues. The supplier, because they are getting a much larger part of your business, could share cost issues (and savings!), capacity information, supplier concerns and other key information that gives your company far better visibility into potential risks.

Which brings me to the dichotomy between supplier rationalization and risk management (which really isn’t a dichotomy at all…) If you have a component that is key to a product (if you couldn’t get this component you would not be able to make your product(s)). If that product is key to your business, you need to identify and evaluate the risk that this supplier won’t be able to supply your goods. If you truly have a partnership with your supplier, this risk assessment ought to be pretty easy to do because the necessary communication has been happening.

But what if you have been reducing suppliers but not putting effort towards improving communication? In my opinion, you are in a much poorer position for evaluating risk and as such you should absolutely work towards either improving the partnership with that particular supplier or developing other sources. Depending on the strategic importance of this component, you may wish to develop an alternative source regardless. No level of partnership can provide visibility to an earthquake, hurricane or fire for example. Despite the strong partnership, that supplier would still not be able to produce.

Remember, the need for a mitigation strategy depends on the risk and the impact of that risk. You need to do the risk assessment for those suppliers that will have a significant impact on your business. In today’s environment with the efforts towards supplier consolidation, you have much fewer suppliers to assess. On the other hand, if any one of those suppliers fail, the impact on your business will be much higher.

What is your approach to supplier rationalization? How is this impacting risk management in your company?

John Westerveld is a product manager for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with the collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9491 http://forums.industryweek.com/showthread.php?t=9491 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/GI2TTDxzzLo/showthread.php Thu, 05 Nov 2009 13:26:25 GMT Kinaxis has just published its latest white paper: “PROVIDING CARBON FOOTPRINT VISIBILITY AND PLANNING CAPABILITIES ACROSS THE SUPPLY CHAIN : WHY YOU NEED TO DO IT, AND WHAT YOU NEED TO DO IT” (http://info.kinaxis.com/content/providing_carbon_footprint) Carbon is challenging business in many... Kinaxis has just published its latest white paper: “PROVIDING CARBON FOOTPRINT VISIBILITY AND PLANNING CAPABILITIES ACROSS THE SUPPLY CHAIN : WHY YOU NEED TO DO IT, AND WHAT YOU NEED TO DO IT”

Carbon is challenging business in many ways and companies will continue to be pressured to better manage their carbon emissions. Companies that get ahead of the curve will be rewarded by investors and consumers alike. Companies that lag the curve run the risk of losing investor confidence, consumer trust, and falling behind in product development.

It is estimated that between 40 and 60 percent of manufacturers’ carbon emissions reside in their supply chains. As such, new supply chain visibility and planning tools need to be adopted in order to be able to consider carbon emissions as an additional factor in the decision making process.

This paper provides a brief exploration of the current carbon landscape and will outline the attributes of an ideal supply chain carbon management application.

John Nafis is a business consultant for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9341 http://forums.industryweek.com/showthread.php?t=9341 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/x7c9SBFaHCs/showthread.php Wed, 04 Nov 2009 15:52:23 GMT Having spent many years selling and delivering services for a major ERP vendor, I can say with experience that just implementing a module (or suite) just because it comes as part of your ERP solution doesn’t always make sense. The ERP vendors are always selling the “vision” of single vendor... Having spent many years selling and delivering services for a major ERP vendor, I can say with experience that just implementing a module (or suite) just because it comes as part of your ERP solution doesn’t always make sense. The ERP vendors are always selling the “vision” of single vendor accountability to an organization and if you buy into that then it comes naturally just to implement all the software from that vendor. Generally speaking, this is not usually a problem if you are performing basic functionality such as Human Capital Management (HCM) or Financial Management, but where the breakdown occurs is when implementing software that is associated with the company’s strategic direction and competitive differentiation such as Manufacturing and/or Supply Chain Management (SCM) software.

During my tenure implementing the true ERP suite vision (everything included; HCM, Financials, SCM, Mfg, CRM, etc.) for a company, the company would always struggle during the SCM and manufacturing part of the project. This was generally because every manufacturer runs their company differently in order to maintain a competitive advantage and trying to fit a one size fits all product into a company doesn’t work. In addition, the ERP vendors would sell the company on a single platform for integration, and many times some of the SCM products were really acquired products that are more like bolt ons and the integration doesn’t necessarily exist. So, not only is there generally more work to integrate the product, but the functionality may not exist that the customer requires for their business. These were difficult customer situations to manage.

I believe that customers should really do a thorough vendor selection when looking to procure SCM or manufacturing software, and I don’t think I am alone in this belief. In an ErpPandit.com article entitled “Basic ERP Features” the author gives a primer on comparing mid-market ERP providers and when discussing SCM module states “Of all the ERP modules, SCM has the greatest variability between vendors: It is vast and varied, yet often adapted to the needs of specific industries.” If that is true (which I believe) then how can a company not do their due diligence when selecting software? Certainly you don’t want to be a food and beverage manufacturer and implement a product which is designed for the high tech industry.

This of course doesn’t mean that the SCM software from your ERP vendor won’t work for you, all I am suggesting is that it is worth the time to look at alternatives. Companies should not fall into the trap in assuming that just because the SCM software was part of an ERP solution that fits your company that the SCM software either works for your unique business or is tightly integrated into the back office ERP functions.

There is another post on the Adexa blog entitled “Cost of ERP vs. Best-of-Breed Supply Chain Planning Systems” which also does a nice job educating the reader as to what to consider when performing a software evaluation data integration, planning analytics and configuration cost. There is now a lot of evidence out there of failed SCM implementations and I personally don’t want to have to be on the hook to deliver an SCM software implementation for a company where the software doesn’t match the requirements.

Monique Rupert is vice president, professional services for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9321 http://forums.industryweek.com/showthread.php?t=9321 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/WTcW4cRhZjo/showthread.php Mon, 02 Nov 2009 17:57:50 GMT Supply chains are getting good business press lately. On a daily basis, I come across quotes like the one in a recent BusinessWeek article stating, “The ones [companies] that manage supply chains best will come out ahead as the recession eases.” Is the supply chain finally being recognized by the mainstream as a strategic capability of a company, rather than merely a function to execute? And is there agreement that it’s not just a cost center, it can be a revenue generator too?

In this particular article, it quotes the Chief Executive of Nokia as saying “We would have sold more phones in the third quarter without the capacity constraints.” Because production was lowered dramatically during the recession, some companies - in consumer electronics in particular – are now seeing spot shortages due to unexpected demand increases. As the article points out, “ The coming months could be tricky…Manufactures must gauge demand accurately among economic uncertainty.” Therein lies the rub: How to balance the opportunities to capture all demand while mitigating against the risks of excess and/or obsolete inventories.

Demand planning is going to be key without a doubt, but equally important will be demand responsiveness – acting quickly to the unexpected - and overall supply chain agility. Even before the recession, companies struggled with demand volatility because of increased competition, decreasing customer loyalty, constant new product introductions etc. But in today’s grave economic climate with major demand swings and declining spending overall, planning for future demand based on historical data is now virtually impossible. With inventories at an all time low, retailers and suppliers will need to respond rapidly to actual demand. Companies need the ability to detect demand trends early so that they can ramp up production accordingly in order to avoid the situation Nokia described in the article.

Solving the rapid response challenge will require:

• accurate and timely demand sensing to quickly understand demand shifts
• collaboration: both with customers to gain consensus on true demand, and with internal colleagues and supply partners to develop and analyze resolution alternatives; and
• decision support that drives profitable responses through shaping demand and allocating finished goods supply as appropriate

I believe achieving excellence in responding to changing customer demands has become the number one challenge facing enterprises today and can represent the largest opportunity for companies to increase customer service, enhance margins and attain more predictable revenue across the entire value chain.

Trevor Miles is director of industry and applications marketing for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9191 http://forums.industryweek.com/showthread.php?t=9191 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/hBr5A4JyFG8/showthread.php Tue, 27 Oct 2009 13:18:48 GMT Dan Gilmour of Supply Chain Digest in his newsletter for Oct 22, 2009 published a list of “things” that will change in supply chains by 2015. There were a number of things that Dan identified that really boil down to the blurring of operational supply chain planning and execution. We have been seeing this trend for some time, driven by the volatility of demand and outsourcing, which in turn drive the need for greater responsiveness. My full response to Dan’s article is below. I would welcome your comments.

__________________________________________________ _

Great article, Dan.

I liked your identification of the drivers, and wished that there had been more prediction of what the consequences would be. For example, how will companies reconfigure their supply chain? In this particular case, I think we only have to look at Apple and Cisco to see some direction. Both of them outsource virtually all their production. And of course Apple, as you state in your article, is at the forefront of the “digitization” of the supply chain.

What really fascinates me is the rise of the brand owners in China and India. I saw an article today in McKinsey Quarterly that China’s economy grew 8.9% in Q3 this year. Even in the boom period before 2000, growth rates in the US fell short of this number. Of course, this is even more startling when comparing the growth rate in China over a similar period.

I think we are missing the effect this will have on the Western brand owners such as Apple. It might seem counter-intuitive given Apple’s record quarter and I have no idea of the product strategy, but I wonder how much they are designing products for the Western world and how much they are assuming the Eastern consumer needs are the same.

As you correctly point out, there will be huge impacts on “product design, pricing, logistics and much more.” I am fascinated by the growth of Eastern brand owners such as Acer, Lenovo, and Huawei. We have weathered the storm of the Japanese companies in the 1980’s – Sony, Toshiba, Toyota, Matsushita, … but those were different economic times when those companies were designing products for a western market.

I am not yet convinced that Western brand owners are paying sufficient attention to the needs of Eastern markets. These have been very Western focused, but I suspect as the pride in their countries economic performance grows, so will their confidence and demand for products to meet their specific needs.

We have a number of customers who are the forefront of the blurring of operational supply chain planning and execution. Of the 10 things you identify, I think this is a consequence of many of the others. And you are correct, this blurring is reaching up into tactical planning too with more and more companies running S&OP on an as-needed basis.

The factors you identify, specifically reduced inventory levels and pervasive visibility, are driving this blurring. We all know that inventory has been used as a buffer between the demand and supply chains. Reduced inventory levels require a much more agile supply chain that is very responsive to change. And of course the supply chains need to be reconfigured to be more responsive.

Dashboards are of course a necessary precursor to understanding whether or not one is on-track to meet future objectives and any deviations need to be addressed before they become “actuals” and appear in a scorecard.

Once again, thanks you for a great article.

Trevor Miles is director of industry and applications marketing for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=9091 http://forums.industryweek.com/showthread.php?t=9091 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/yBz3qSfUVWo/showthread.php Thu, 22 Oct 2009 13:03:14 GMT In a recent Wall Street Journal article, “September Sales May Foreshadow Holidays,” it is stated that stores are slashing inventories to avoid price cutting. Inventories are at an all time low. How will retailers and suppliers respond when demand changes?

Per the article “Retailers and analysts will be closely watching September sales reports due Thursday from key store chains for any sign they may need to adjust their already-gloomy holiday forecasts. ”

There is always a fine balance between meeting profitability targets and revenue. In the retail business, competition is fierce and retailers need to have the product ready to ship. With the current economic uncertainty, retailers are choosing to stock less with an expectation that they will be able to respond to the market demand when it improves. However they are faced with global supply chains, long lead times and there will be a capacity constraint on suppliers when the demand increases.

There are a number of approaches that retailers need to consider:

• Get closer to customer demand. Analyze point of sale data
• Analyze demand trends (units and $) by product, by region, by time
• Apply supply risk management strategies (minimize single sourcing, establish VMI hubs, standardize on components or materials across products, identify product configuration alternates)
• Have the ability to make the appropriate decisions regarding allocation (by region, customer segmentation)
• Perform contingency planning scenarios – adding capacity, alternate shipping methods
• Have the tools in place to remove the latency from the change in consumer demand through the supply chain to the individual manufacturer. Ensure that any change is communicated throughout your supply chain in minutes to hours, versus days or weeks.

History will not predict the future in consumer spending. Crystal balls won’t work either. Retailers will need to watch consumer demand patterns very closely and be ready to engage their supply chain at a moment’s notice. Collaboration will be required between the trading partners. In today’s economic climate, speed wins.

Carol McIntosh is a business consultant for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=8961 http://forums.industryweek.com/showthread.php?t=8961 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/o8al2dQ_DuI/showthread.php Fri, 16 Oct 2009 12:54:45 GMT Kinaxis has just published its latest white paper, Five Ways Your Procurement Could Be Leaving Money On The Table (http://info.kinaxis.com/content/five-ways-procurement) Enterprises that provide their strategic procurement teams with proper tools can expect them to deliver year-over-year cost... Kinaxis has just published its latest white paper, Five Ways Your Procurement Could Be Leaving Money On The Table

Enterprises that provide their strategic procurement teams with proper tools can expect them to deliver year-over-year cost savings, close to 10 times their expenses.

This white paper

• lists five key pieces of intelligence that enable strategic sourcing professionals be more effective
• describes a real-life negotiation in which superior supply chain visibility and collaboration helped minimize a dramatic price hike attempted by a supplier
• presents a recent analyst’s report that confirms the value of strategic procurement, and describes several key characteristics of the top-performing teams… especially how they exploit technology to gather this strategic intelligence and avoid leaving money on the table.

Click here to download a free copy

Chuck Thomas is director of professional services for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=8901 http://forums.industryweek.com/showthread.php?t=8901 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/GxQmFuUeHa8/showthread.php Thu, 08 Oct 2009 13:57:44 GMT I was asked the following questions the other day about companies positioning themselves for the recovery, I thought I would share my thoughts with all of you too. *1. Bill, what are you hearing on your prospect and customer calls?* We are seeing companies that are taking advantage of... I was asked the following questions the other day about companies positioning themselves for the recovery, I thought I would share my thoughts with all of you too.

1. Bill, what are you hearing on your prospect and customer calls?

We are seeing companies that are taking advantage of current conditions to improve processes and put themselves in a position to capitalize on demand opportunities when they happen.

Consider AMR Research’s Supply Chain Top 25 for 2009 for example. AMR observed that, “Despite the fragile world economy, many of the companies on this year’s list remain convinced that winners will be those able to position for a return to growth. Privately, these companies will say that they expect to gain market share from their weaker competitors. Most saw the signs of trouble early and secured their cash positions well enough to maintain momentum on vital initiatives. 2010-11 will show where such foresight pays dividends, with greater supply chain agility enabling survivors to knock off competitors for good and deliver huge earnings in the climb out.”


2. Are there any specific areas companies are looking to improve?

In my position as a business consultant, I have the opportunity to hear directly from companies where their focus is. Quite often we hear from companies that are looking to improve their S&OP process. Demand planning and collaborative forecasting are among the top inquiries too. Inventory rationalization and reduction, plus improving supply chain performance are also up there.


3. What are you hearing when people inquire about improving S&OP?

People are realizing they have to let go of the anchors that are weighing them down and will keep them from being positioned for recovery. When we ask manufacturers how long it takes to complete an S&OP cycle, most reply at least a month. People can’t wait that long anymore to respond to a change that could negatively affect their strategy or to an opportunity that may present itself.

Getting access to the data that supports S&OP, running analysis, collaborating and conducting what-ifs (like price decreases or early new product introductions) and communicating that strategy to the rest of the organization, has to be as easy as searching for New York City on Google maps. Cycle time reduction of the S&OP process will be key to positioning for recovery.


4. Anything else people are asking for?

Sometimes it is surprising but people are still asking for visibility.

I like to call this “What-is” information. This continues to be a challenge in the global organizations, especially if different sites have different ERP systems or other sources of data. This consolidated view is much different than BI or a data warehouses. The visibility people are asking for will allow them to answer questions like, are there stranded inventories that could satisfy shortage conditions at other locations. Are there open PO’s with no demand? Are there integrity issues with my data I could easily fix? Are there period ending shipment misses I could avoid?

This isn’t about comparing history but simply understanding the current state and where there are opportunities to reduce inventories, increase deliveries, and improve the integrity of SC data, all of which ultimately increases profits and customer satisfaction. Turning data into information is always something people need to do but struggle to do with current tools.

Bill Dubois is a business consultant for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=8671 http://forums.industryweek.com/showthread.php?t=8671 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/IrTr31wESX0/showthread.php Wed, 07 Oct 2009 12:43:53 GMT Does the word “chain” accurately reflect the required communication flow of supply and demand throughout the supply network? In actuality, the “Supply Chain” reflects a series or sequential set of steps that are required to build and deliver products to customers. brand owners or manufacturers... Does the word “chain” accurately reflect the required communication flow of supply and demand throughout the supply network?

In actuality, the “Supply Chain” reflects a series or sequential set of steps that are required to build and deliver products to customers. brand owners or manufacturers need to order and receive products or materials from suppliers, who in turn need to receive materials from suppliers and so on through the multiple tiers of a given supply chain. In addition, at each tier in the supply chain, manufacturing operations and/or assembly/test operations need to be accomplished, which in many cases are represented as levels in the respective bills of materials at each tier in the supply chain. This is what has to occur for products to be manufactured and delivered to customers.

In a lot of cases, the communication of supply or demand changes tend to follow this same linear, sequential series of steps up and down the supply chain. Communication of a demand or supply change is initiated by the brand owner or manufacturer and this has to be communicated sequentially through the multiple tiers of suppliers. In addition, the assembly or manufacturing at each tier are represented in multiple bill of material (BOM) levels at each tier. At these BOM levels, there can be production orders, firmed orders or master production schedules that hold the current schedule until a planner changes them and allow these changes to continue flowing through the chain.

Therefore, if this same linear, sequential series of multiple tiers of suppliers as well as multiple BOM levels need to be followed to communicate and collaborate changes required of supply and demand, then weeks and even months can go by before the changes reach the end of the supply chain. Obviously, by this time, another series of changes can be rippling through the links in the chain and the supply chain cannot respond to these changes in a timely manner.

This problem is only magnified when you consider the risk factors associated with increased outsourcing that can result in more supply disruptions/issues. And strikes, political issues, recessions and even natural disasters can all cause minor to significant supply disruptions that will throw off the normal chain of activities. The end result can be excess inventory or lost sales due to not having products available for delivery to the customer.

So while obviously the concept of the supply chain is certainly not obsolete, the information flow and collaboration throughout the supply chain needs to flow seamlessly and not as a linear, sequential series of steps.

So don’t shackle yourself to the notion of a chain.

Max Jeffrey is an integration consultant for Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=8631 http://forums.industryweek.com/showthread.php?t=8631 http://feeds.penton.com/~r/21stCenturySupplyChain/~3/g_9f5alvbrA/showthread.php Tue, 06 Oct 2009 13:32:12 GMT The two major ERP vendors are facing a more rapid decline in licensing revenues due to IT cutbacks. In fact, they are essentially facing a “Reset” - more so than a recession. CIO’s are very tired with ERP vendors raising maintenance and throwing acquired software products at them left and right.... The two major ERP vendors are facing a more rapid decline in licensing revenues due to IT cutbacks. In fact, they are essentially facing a “Reset” - more so than a recession. CIO’s are very tired with ERP vendors raising maintenance and throwing acquired software products at them left and right. Once a software vendor decides on pursuing a “financial engineering” acquisition strategy – it is never good for the end customer. It improves earnings for the vendor. Any large company has challenges when it comes to innovation – even if R&D monies are allocated to development teams. Politics alone can kill innovation inside a large vendor.

CIO’s are even more disgusted with what I call the “Suites are Sour” paradigm promoted by the ERP vendors. They want to solve business problems, not spend millions on integrating suites of modules. Once maintenance fees hit a high enough level and innovation is absent – it creates a positive environment for a “disruptive” offering. We have seen this happen time and time again in the hi-tech market.

Douglas Colbeth is CEO of Kinaxis, provider of the on-demand RapidResponse service that empowers multi-enterprise manufacturers with collaborative and integrated demand-supply planning, monitoring, and response capabilities. ]]> 21st Century Supply Chain Lori Smith http://forums.industryweek.com/showthread.php?t=8611 http://forums.industryweek.com/showthread.php?t=8611