Archive for the ‘General News’ Category

Will the Internet of Things (IoT) Help Eliminate Information Latency and Deficiency in Supply Planning?

Published October 14th, 2014 by Prasad Satyavolu 3 Comments

Last week, Trevor Miles wrote “SMAC in the Middle of Supply Chain Change” and it made me recall the dozen or so articles I’ve read recently on the Internet of Things (IoT). I find that most have a similar opening – 30 billion or so devices will be connected by 2017 and more “things” will be connected than human beings on the earth. More and more sensors are getting embedded in the “things” and leading to an explosion of information availability.

devices internet of things

But in all fairness, this is indeed an unprecedented opportunity to leverage IoT for a transformation of the supply planning paradigm.

A multitude of challenges are emerging from a rapidly evolving supply & demand environment that warrant a fresh look at planning – really to assess the level of entropy! So when I started to think about planning processes in the context of IoT, I was wondering if we can conquer those two old enemies of planning effectiveness: information deficiency and information latency. The prospect seems exciting – new offerings targeted to finely segmented markets customized to individual customers, and movement of goods providing continuous visibility. Will IoT design enable us to get demand signals from the products and sensory information from the entire set of physical infrastructure for planning?

It is evident that this is crucial, as most manufacturers are still citing incidents of supply chain disruptions resulting from the lack of information visibility. In a 2013 survey by Business Continuity Institute  of over 500 business continuity professionals from 71 countries, 75% of respondents reported that they did not have full visibility of their supply chains.

From the proceedings at the Intelligent Transportation Systems World Congress in Detroit earlier this month, it certainly appeared that the green shoots are in sight. Mary Barra, GM’s CEO, announced a partnership for the development of a 125 mile long corridor of Intelligent and Connected Infrastructure in collaboration with academia, government and industry. While it by no means provides complete coverage, it is a bold start to create a truly interconnected ecosystem that will generate information efficiencies and not information overload for extreme planning.

sensors mobile internet of things

Umberto Eco writes that “Any fact becomes important when it’s connected to another.” Perhaps a philosophical underpinning to the possibilities from convergence of physical and digital supply chain? The path to realization certainly lies in synchronous orchestration of multiple technologies.

Applying Systems Thinking to all aspects of planning in supply chain will therefore help to improve the “input” and create better “closed loop feedback”. The developing IoT ecosystem certainly has the potential for eliminating the information latency and deficiency that we see today in the planning processes.

What do you think? Comment back and share your thoughts.

Posted in Demand management, General News, Inventory management, Sales and operations planning (S&OP), Supply chain management


Remembering: Turning Visibility into Possibility by Don Gaspari, NCR at Kinexions

Published October 9th, 2014 by Melissa Clow 0 Comments

As we countdown the days until Kinexions (18 days!). I’m remembering our fascinating customer videos. Today I’d like to share the interview on ‘Turning Visibility into Possibility’ from Kinexions.

In this video hear, Don Gaspari, Director, Materials & Inventory, Global Operations and Logistics, NCR, speak about his time at NCR and their vision to leverage it’s market leadership in self service devices and applications to transform the way that business does business with consumers. To support the company’s vision, NCR’s Global Operations team has developed a “Next in Class” supply chain strategy to enable it’s manufacturing and distribution network to efficiently and effectively respond to customer requirement’s.

To view the video in its entirety, watch it below or here.

Posted in Demand management, General News, Inventory management, Response Management, Sales and operations planning (S&OP), Supply chain management


Throw Back Thursday: Remembering ‘Meeting Customer Demand in a Complex Industry’ from Kinexions

Published October 2nd, 2014 by Melissa Clow 0 Comments

Kinexions is in 26 days! As we countdown the days, I’m remembering our fascinating customer videos. Today I’d like to share the interview on ‘Meeting Customer Demand in a Complex Industry’ at Kinexions.

In this video hear, Gary Dietz, Manager, Global Logistics and Supply Integrated Supply Chain and Logistics, Kennametal, as he discusses the challenges his company faces in gaining full visibility of supply and demand, and in dealing with increasing supply chain volatility.

This global manufacturer of surface-cutting tools, with headquarters in western Pennsylvania. Customers include the aerospace, surface mining, oil and gas and machine-tool industries. Dietz says the company operates in “a very demanding industry,” characterized by highly unpredictable demand. The challenge is becoming even more daunting as Kennametal moves into the developing world, its most promising source of new business.

The company’s biggest pain point, he says, is managing assets. Kennametal strives to meet customer demand for customized products, while also manufacturing to stock. Accuracy in the making and placement of items is essential, says Dietz.

To view the video in its entirety, watch it below or here.

Kennametal realized that their past supply chain capabilities were not sufficient to support growth, he says. “We’re looking for flexibility in our supply chain to adapt.” The company needs to be able to perform “what-if” analyses of future demand, while possessing the ability to quickly scale up in line with demand.

Dietz says the company is currently implementing systems to provide it with more visibility to supply and demand. The effort requires cooperation from planning, production, marketing and sales.

Among the biggest challenges associated with the initiative is the management of “big data.” Kennametal produces some 12,000 combinations of products and SKUs, “so moving data between systems is a major challenge,” according to Dietz.

Like most companies, Kennametal had been highly dependent on spreadsheets to drive its planning function. With its business topping $3bn in revenues, it can no longer depend on that capability to handle future demand, Dietz says. The company has embraced technology that will allow it to improve both customer service and internal processes.

 

Posted in General News, Inventory management, Sales and operations planning (S&OP), Supply chain management, Supply chain risk management


Unleash Pixar-like Creativity in Your Supply Chain Management Organization

Published September 30th, 2014 by Jonathan Lofton 3 Comments

pixer creativity in your supply chain management organizationI recently read “Creativity, Inc.: Overcoming the Unseen Forces That Stand in the Way of True Inspiration” and it got me wondering about creativity within supply chain management organizations. There’s obviously a level of ‘magic’ at Pixar, for them to be able to create 14 No. 1 movies in a row.  Evidence that the principles they’ve developed has merit is easy to see as Disney Animation Studios, led by Pixar’s Ed Catmull (President) and John Lasseter (Chief Creative Officer), has now started producing blockbusters again (e.g.  Frozen, the top-grossing animated film of all time, surpassing the $1.063 billion earned by Toy Story 3) after a long period of so-so animation movies.

I’m always curious if success in one area/industry can be translated to generate similar success in other areas/industries. In this case I do believe there are learnings that can be applied to supply chain management.

So what makes Pixar so creatively successful?  How do they get from a movie that “sucks” to a blockbuster?  And more importantly, can supply chain management leverage these learnings?

“What I’ve learned running Pixar applies to all businesses.  I apply the term ‘creativity’ broadly … it’s problem solving. We are all faced with problems and we have to address them and think of something new and that’s where creativity comes in.”

 – Ed Catmull, FastCompany article, “Pixar President Ed Catmull On How To Run A Creative Business”

At the back of the book Catmull has a lot of bullet points around thoughts for managing a creative culture, which at the end of the day isn’t exclusive to ‘creative’ businesses, including:

  • Give a good idea to a mediocre team, and they will screw it up.  Give a mediocre idea to a great team, and they will either fix it or come up with something better.
  • Failure is a necessary consequence of doing something new.
  • The healthiest organizations are made up of departments whose agendas differ but whose goals are interdependent.  If one agenda wins, we all lose.
  • The process of problem-solving often bonds people together and keeps the culture in the present.
  • A company’s communication structure should not mirror its organizational structure.  Everybody should be able to talk to anybody.
  • Imposing limits can encourage a creative response.
  • Engaging with exceptionally hard problems forces us to think differently.

What stands out foremost in the book as the underlying factor of Pixar’s success is what they call the “Braintrust”.  The Braintrust brings together a bunch of smart, passionate people to review a movie as it goes through its lifecycle.  The folks that make up this group naturally include directors, producers, writers, and animators but it could also include individuals outside the typical ‘creative’ areas.  They use this Braintrust to create a healthy culture where people feel free to share ideas and to constructively criticize.  There are a few principles of the Braintrust that are vitally important:  The individuals must be sharp and passionate; the team has to put a lot of solutions out in a short amount of time; there has to be absolute candor – this is the premier guiding principle.   I think the ‘magic’ comes via another key tenant of the Braintrust – this group has no authority.  The group can’t make the director change the movie.  It’s their job to get to the essence of what’s wrong (Catmull says all Pixar movies “suck” at some point); it’s the director’s job to figure out how to address the feedback.

OK, so how does this relate to supply chain management?

Well, these periodic Braintrust sessions remind me a lot of Consensus Demand Planning and Sales & Operation Planning (S&OP).  Consensus Demand Planning incorporates various organizational views and possible biases on what the forecast looks like.  Others in the organization are required to collaborate and creatively determine how to best balance supply & demand while optimizing company objectives (margin, inventory, revenue, etc.).  At the end of the day, the S&OP team may have several suggestions on what to do … but it’s the Executive S&OP (the “movie’s director”) that has the ultimate responsibility for absorbing the options and deciding how best to drive the company forward.  So what if Consensus Demand Planning and S&OP looked and felt more like a group reviewing a movie’s “dailies” using Pixar Braintrust-like principles to collaboratively solve problems?

I tend to subscribe to “The Wisdom of Crowds” and believe that if we can leverage tools that give end-to-end visibility to the strong, passionate professionals in our supply chain organizations and break down walls to encourage & support real-time collaboration, we can also unleash Pixar-like creativity (and success).  In support of the Braintrust principles, below is what I currently see on the creatively collaborative SCM continuum.

creative braintrust supply chain collaboration
I’d appreciate additional wisdom from the supply chain crowd out there (I’m sure there are other applications, approaches and principles out there that are really creative and bleeding edge). Do you have a formalized ‘Braintrust’ type process and the supporting tools for creative SCM? What are you doing (or seeing) in terms of SCM creativity!?

 

Posted in General News, Response Management, Sales and operations planning (S&OP), Supply chain management


Top 10 Movie Quotes from Kinexions! The Kinaxis Training & User Conference

Published September 26th, 2014 by Bill DuBois 0 Comments

Film poster for Top Gun (film) - Copyright 198...It’s an exciting time of the year at Kinaxis as we gear up for another user conference. Kinexions will take place this year in San Diego with the theme set as Innovation at Mach Speed (with some Top Gun references), a keynote from Navy SEAL Robert O’Neill and Afterburner (actual fighter pilots), along with a unique Customer Appreciation event.

The last couple of years we did parodies on movies, like “The Hangover” and “Back to the Future” so with the movie theme continuing, here are the…

Top 10 movie quotes from Kinexions that were also heard in famous movies.

10. Exchange between a customer and developer after seeing the capabilities in the next release: “Surely you can’t be serious?!” “I am serious…and don’t call me Shirley.”

9. Customer sharing ERP deployment horror stories: “ERP deployment is like a tense episode of ‘Everybody Loves Raymond’…only it doesn’t last 22 minutes. It lasts a lifetime.”

8. Customer talking to his Account Executive: “Keith, since I’ve met you I’ve noticed things I never knew were there before…birds singing, dew glistening on a newly formed leaf, stoplights….(scorecards, dashboards…).”

7. Customer after hearing Doug Colbeth’s opening remarks: “He’s the sweetest guy. Have you ever looked into his eyes? I swear it was like the first time I heard the Beatles.”

6. Prospect after seeing a Customer presentation: “I’ll have what she’s having.”

5. Customer before the Product Management presentation: “Go ahead, make my day.”

4.  Product Management after their presentation: “How’d ya like those apples?”

3. CIO to VP of Supply Chain: With great power comes great responsibility.”

2. Customer running a “what-if” in a training class: “I feel the need. I feel the need for speed.”

1. Attendee leaving Kinexions: “I’ll Be Back”.

 

Can you guess the movies? Hope to see you at Kinexions.

kinexions 2014

Posted in Demand management, General News, Jokes, Sales and operations planning (S&OP), Supply chain collaboration, Supply chain management


Your supply chain is costing you money – Reason #4 Making key decisions by modelling the supply chain in Excel

Published September 24th, 2014 by John Westerveld 5 Comments

Reason #4 Making key decisions by modelling the supply chain in Excel

Making key decisions by modelling the supply chain in Excel

Over the years, working for and with numerous manufacturing companies, I’ve seen many supply chain practices that cost companies money.  Over the next several weeks, I’ll outline these issues and discuss some ideas around how to avoid these practices. You can find the previous posts here:

In my career, I’ve had the pleasure of working with several top tier supply chain companies. Companies that are household names. Companies that have been in business for decades. Companies worth billions of dollars.  Companies that are forced to use Excel to manage large swaths of their advanced supply chain planning.  Companies that are starting to realize that while Excel is a powerful tool and can be used for lots of things, it isn’t the tool to use to run your supply chain.

Excel excels (if you’ll pardon the pun) at many things.  But modelling complex supply chain relationships isn’t one of them. There are many issues with using excel that have been written about numerous times in this blog.  A sampling are here, and here.

I can briefly summarize the main points;

Companies use Excel because their traditional planning systems don’t allow them to view and understand aggregate data and more importantly, don’t allow them to effectively react quickly to change.  However, because people need this information and because people (especially those in supply chain) are very smart and come up with ingenious ways to solve problems, they extract data from their ERP systems and build complex models in Excel.

So we understand why companies turn to Excel; they can’t get what they need from ERP.  Now let’s look at why Excel shouldn’t be used to run your supply chain.

Errors – Excel is a free form modelling tool – which means anyone can build a spreadsheet for just about anything.  Many of these spreadsheets are not validated or tested, meaning that the model is only as good as the persons that create the model.  Millions of dollars have been lost to Excel errors.

Everyone has their own version – While you can password protect and lockdown Excel spreadsheets it is difficult to do effectively and many companies simply don’t do it.  This means that often there are multiple copies of the same spreadsheet, all slightly different.  I’ve been in meetings where what appears to be the same spreadsheet tell different tales because someone made a data or formula change.  Eventually everyone has their own version and are all going off in different directions.

Excel is not supply chain software – it doesn’t matter how good your Excel model is, you simply cannot model the complexity of the supply chain in Excel. This means that the best you can do is build an approximation of your supply chain in Excel.  As we know, in supply chain, details do matter and the small detail that is approximated in your model might be the detail that costs you.

So if ERP can’t do it and Excel isn’t the tool, what tool can help you make supply chain decisions?  This tool needs to have the following characteristics;

End to end visibility – To make supply chain decisions, you need to have visibility across your supply chain. You need to be able to see where inventory exists, what capacity is available and what the issues are.

Simulation – The ability to create a scenario, make a change and instantly see the impact of what that change means that you can try things out and know with confidence that it’s going to work.

Full supply chain analytic model – Supply chain planning is very complex and while most vendors have similar basic logic there are many differences between systems, even within implementations of a given system.  To effectively model this logic, you need a tool that can simultaneously model the supply chain logic from all these different systems.

Collaboration - No one person has knowledge of the entire supply chain in their head.  You need to be able to work with others to resolve complex issues.  So an effective supply chain decision tool will need to allow you to quickly identify who you need to work with and then share your scenario with those people.

How do you make your major supply chain decisions? Comment back and let us know!

 

Posted in Demand management, General News, Inventory management, Response Management, Supply chain collaboration, Supply chain management


Purposeful Collaboration: What It Could Mean for Your S&OP Process

Published September 22nd, 2014 by Melissa Clow 0 Comments

Purposeful Collaboration What It Could Mean for Your S and OP Process

Just a quick post to let our readers know of an upcoming webcast “Purposeful Collaboration:  What It Could Mean for Your S&OP Process” on Wednesday, October 8th at 2:00pm ET.

Even with heavy investments in Sales and Operations Planning (S&OP), many organizations are not achieving material or sustainable breakthroughs. This is often because they are executing a sequential, disjointed process with contributors operating in their narrow functional box.

In this webcast, learn how purposeful collaboration can connect content, conversations, colleagues and communities to drive improved business outcomes.

Topics covered:

  • Harnessing and capitalizing on “working social” in a B2B environment
  • Using the key tenets of purposeful collaboration to enable effective decision-making, resolution and consensus building
  • Capabilities required to facilitate purposeful collaboration in S&OP
  • Changing the mindset away from the individual supply chain / S&OP functions to connecting functions and most importantly, people

register now

 

 

Speakers:

Alan Lepofsky, VP and Principal Analyst, Constellation Research
With almost two decades of experience in the software industry, Alan helps organizations understand how to develop, purchase and implement collaboration solutions. Rather than evangelizing how social software can change the way people work, he instead focuses on how organizations can improve their existing business processes by providing access to the colleagues, content and communities that can help people get their work done more effectively.

Trevor Miles, VP Thought Leadership, Kinaxis
As vice president of Thought Leadership, Trevor serves as an expert source for Kinaxis customers, prospects, industry analysts and journalists. Known throughout the supply chain field, he has published many articles, presented at various industry events, and is a contributor to the Kinaxis 21st Century Supply Chain blog.

 

Posted in General News, Milesahead, Miscellanea, Sales and operations planning (S&OP), Supply chain management


Your supply chain is costing you money – Reason #3 Not having end-to-end supply chain visibility

Published September 17th, 2014 by John Westerveld 0 Comments

LA freeway is like complex streets of supply chain

Not having end-to-end supply chain visibility

Over the years, working for and with numerous manufacturing companies, I’ve seen many supply chain practices that cost companies money.  Over the next several weeks, I’ll outline these issues and discuss some ideas around how to avoid these practices. You can find the previous posts here:

Imagine this scenario.  You are a supply chain leader. It’s Friday afternoon and your thoughts are turning to the upcoming weekend with your family.  The phone rings – it’s your VP of sales. A prospect that your company has been chasing for years has finally agreed to place an order.  It’s a big one and they need it fast.  Really fast.  Inside cumulative lead-time fast.  The question is can you do it.  Can you commit to this order with confidence that you can deliver?

Traditional ERP offers a couple possible options.  1) Load and pray. Accept the order and hope / pray that everything aligns and you actually can deliver on time… maybe event at a profit. The problem with this approach is that very often, you can’t deliver and you lose a customer and worse your reputation.  2) Fire drill (I knew a company that actually called it that). This is where you e-mail each node in the supply chain with the order requirements, have everyone do a feasibility analysis on accepting the order and then wait for the results. The results, however may take several days / weeks to come in.  By that time the customer and their lucrative order have moved on.

Why are there only these two options with traditional ERP systems? It comes down to the disconnected nature of these systems. Companies that have grown through acquisition typically have multiple ERP systems distributed throughout the enterprise. Even if systems are from the same vendor, they will often be at different versions and are not interconnected.  So a scheduler at one plant has no visibility as to the inventory position, capacity or material supplies at another plant.   The only recourse is to pick up the phone or pound out an email to find out…or guess.

There is a third option, one where you can commit to a customer order with confidence. This new approach enables you to simulate the addition of the new order, see the impact across the entire supply chain, try out different options to resolve any shortages and most importantly know that you can commit to and actually deliver this order…and respond in hours not days or weeks.

This option requires a new tool and a new way of thinking. This approach requires lightning fast simulation and, most importantly, visibility to all the nodes of your supply chain. Let’s look at these one by one;

  • Simulation – To simulate the impact of a major supply chain change like a large order you need to have several things; 1) Analytics that model the results from each of the ERP systems involved in your supply chain.  2) An in-memory data model that bypasses the slow read/write cycles used by disk based systems resulting in lightning fast supply chain calculations and 3) the ability to instantly create scenarios – effectively a copy of the entire database within which you can try out multiple approaches to resolve supply chain issues 4) the ability to share and collaborate with other members of your team.
  • Visibility– Imagine trying to drive a car where you have no visibility to the side, none behind nothing out front except through a little 4” by 5” window.  Yes, you might be able to successfully navigate but the chances of you making a very expensive mistake is pretty high. The sad thing is that this is how many of us navigate the complex streets of supply chain. Traditional ERP often are siloes of information locking off other nodes because they are using different versions or worse, entirely different versions. In our drop in situation, you could have sufficient inventory at a different site but never know it because you can’t see it. But visibility goes beyond the raw data.  Many traditional ERP systems limit visibility because they are designed to show one part, one order at a time.  You cannot look at aggregated data without running specialized reports or extracting the data and loading it into a BI tool.Visibility also means understanding the impact of your decisions on key corporate metrics. Knowing that when you make a decision, that it make sense not only from the context of your department, but also for the company as a whole.

How do achieve supply chain visibility?  Comment back and let us know.

 

Posted in Demand management, General News, Supply chain management