Archive for the ‘Miscellanea’ Category

Celestica’s Top Priorities for Improving Forecast Accuracy – SupplyChainBrain & Kinaxis Video Series

Published January 29th, 2015 by Melissa Clow 0 Comments

SupplyChainBrain attended our annual Kinexions user conference, and while there, they completed a number of video interviews with our customers. And, we’d like to share them!

In this interview, hear Jeff Murphy, director of supply chain managed services with Celestica, describe how the company has improved forecast accuracy and demand visibility, against this backdrop of industry transformation.

Celestica has identified three main priorities in its effort to achieve supply-chain transformation: improving forecast accuracy in the face of growing demand volatility, acquiring visibility of product and optimizing of inventory at multiple locations, and synchronizing the chain from end to end.

“Having visibility is one thing,” says Murphy. “But knowing the cause of everything, with a system solution that synchronizes the entire supply chain, is key to our clients.”

Check out: Celestica’s Top Priorities for Improving Forecast Accuracy

Those goals are within reach today, he says. Advances in information systems over the past 10 years have made it possible to enable integration, with the ability to collaborate across multiple networks in real time, Murphy says.

Celestica’s efforts come at a time when contract manufacturers are seeking to do more for their clients than simply building product. Providers are “going up the value stream,” looking to provide additional services that are crucial to getting product to market, says Murphy.

The company is five years into its implementation of the RapidResponse forecasting and planning tool from Kinaxis. “It’s core to our architecture,” Murphy says, adding that the system allows Celestica to be proactive in simulation environments. Employing “what-if” scenarios, the company can see how emergency orders perform, and what impact they have on risk, revenue and inventory levels. “Previously,” he says, “we might chase that [information] for a couple of weeks.”

Clients, too, are struggling to synchronize their supply chains. They are seeking visibility into their contract manufacturers’ operations, all the way to the part level. Celestica needs to be able to respond to customer requests within minutes, as opposed to the days it took in the past, says Murphy.

 

Posted in Miscellanea


How Anritsu Achieved End-to-End Supply Chain Visibility – SupplyChainBrain & Kinaxis Video Series

Published January 23rd, 2015 by Melissa Clow 0 Comments

SupplyChainBrain attended our annual Kinexions user conference, and while there, they completed a number of video interviews with customers, analysts, and Kinaxis executives. And, we’d like to share them!

In this interview, hear Dave Stenfort, director of operations with Anritsu, speak about how the company achieved visibility of inventory and improved control over critical parts in its manufacturing supply chain. Anritsu provides testing and measurement equipment for research and development, manufacturers, and field and maintenance personnel.

Its top supply-chain priority is responsiveness, says Stenfort. Customers expect short delivery times for their precision equipment. To satisfy them, Anritsu is looking at how it can tighten existing relationships with suppliers. “Typically, material is the constraint,” he says.

Watch now:

The company is also working closely with its R&D group to fit new products into existing supply-chain processes. To survive in a sector marked by cutting-edge technology, Anritsu needs to differentiate itself through innovative products. That never-ending quest often requires dealing with new suppliers – a change that adds risk to the supply chain.

In addition, Anritsu is deploying a number of tools and information systems to streamline its supply-chain processes. As they become successful, organizations tend to grow more complex, Stenfort says. There’s a need to focus on “standard functionality.”

Recently the company combined a number of supply-chain functions into one internal organization, crossing lines between sales, corporate and other departments. The shift was considered to be an essential part of Anritsu’s efforts to reduce costs meeting customers’ demands for short order lead times, as well as standardizing systems.

Stenfort says it’s vital to achieve an integrated view of the supply chain. It helps the company to make better decisions, as well as turn around quotes in a matter of hours.

Today, with the help of the RapidResponse, Anritsu can see product in the pipeline all the way back to its contract manufacturers. Such capability “ultimately increases the likelihood of success in getting orders and meeting delivery commitments,” he says.

Posted in Miscellanea


How to Turn Your Supply Chain into an Innovation Engine | Guest Post from Erwin Hermans

Published January 22nd, 2015 by Melissa Clow 0 Comments

erwin hermans celestica  Is There a Third Option for Supply Chain Management Executives Looking to Revamp their SCM Operations? Our partner Celestica recently published the following article, ‘How to Turn Your Supply Chain into an Innovation Engine’. The author, Erwin Hermans, vice president of supply chain services, describes the areas to consider when turning your supply chain into an innovation engine:

  • An Enabler for New Business Models
  • Finding the Real Cost of the Supply Chain and Optimizing
  • Tune the Supply Chain to the Demand
  • Analytics is the Answer
  • How to Take an Idea into Practice

So, how do you turn your supply chain into an innovation engine? Let’s find out.

Highest quality. Lowest cost. On-time delivery. That’s how companies typically view an effective supply chain.

But what if that thinking was replaced with a new vision of supply chain? What if business leaders start to view it as an engine for growth and innovation, a differentiator, and an enabler of product realization and marketing strategies?

Today’s modern supply chains are more than just a back-end conduit to deliver products on time. An organization’s supply chain can deliver value that goes well beyond cost, quality and efficiency.

Let’s look at how the old way of thinking can change.

An Enabler for New Business Models

To look at how the supply chain can be an enabler, business leaders need to shift away from looking at it as a back-end operations function and instead, as a front-end enabler.

Companies like Apple and Amazon have built their businesses by thinking differently. Apple has cornered the market in its supply chain to gain an edge in volume and scale, while Amazon has made supply chain its core business. Apple leverages its scale to lock up supply of key components, thereby shutting out its competitors and shaping demand by constraining supply.

Let’s look at another example, one from the painting industry, where constraints in the supply chain forced different thinking.

In the past, stores had to supply a wide variety of paint colors and finishes based on consumer demand estimates, building inventory and tying up working capital. Today, stores are able to mix and create paint colors on the spot, allowing them to easily respond to changing consumer demands.

The innovation which allows this instant paint mixing to occur is enabled by a supply chain working together with the product management and marketing teams toward a unified goal, reducing the theoretical lead time of paint from weeks to minutes.

Embracing customization within the supply chain is not just confined to paint stores. Dramatic changes to business models through supply chain innovation can be seen in several industries, such as same day/next day delivery in the parcel industry, mass customization in the consumer PC market and a rapid cycle of new product introductions in the retail clothing space.

To replicate this model, organizations should ask themselves how the supply chain can be a catalyst for innovation in their supply chain by delaying product customization to the last possible stage, customizing at the warehouse instead of the factory. And if so, they must determine how the supply chain can help to facilitate the new process and be a differentiator.

Having an open mind when examining a supply chain can turn an entire go-to-market strategy on its head—launching new products and services, and opening up new markets for the business.

Another area to explore is how collaborating with key partners can help build a unique business model. One example is Best Buy, which enabled a services business, Geek Squad, to complement its retail business.

Let’s look at a few opportunities where supply chain can act as a catalyst for growth and innovation.

Finding the Real Cost of the Supply Chain and Optimizing

Simply looking at supply chain costs will not show you the big picture. Developing a total landed cost model that looks at all price elements of a product will unearth insights about the supply chain that can be a platform for growth.

For example, let’s look at a cloud-based infrastructure company that outsources its manufacturing to two contract manufacturers. The current market for their products is heavily centered in the U.S., while growth is expected in Asia. The company’s product is highly configurable with long lead time components sourced from suppliers in Asia. In addition, demand is highly variable resulting in adequate, but not great, on-time delivery performance.

The primary contract manufacturer builds their product in Mexico, within a one- to two-day delivery interval to customers in the U.S., while the second contract manufacturer builds in Asia, with a three- to five-day delivery interval to the U.S. In this scenario, which contract manufacturing model is preferred?

Only a data-driven optimization model can provide enough insight for a rational answer. In this scenario, the contract manufacturer with operations in Asia proved to be the right model due to an Asia-based supply base. Additionally, high variability in demand and proximity as a result of long lead-time components allows for a better response time to customer changes at a lower total cost.

Assessing total landed cost can also serve as the foundation for product and category managers to lead product segmentation and portfolio optimization strategies, and at a tactical level, it can lead to increased profitability and target price competitiveness. Organizations need to determine the total landed cost of its products, which includes many different variables and is not limited to manufacturing and transportation to successfully optimize product portfolio. If a company has a six month oversupply of product, this will factor into the total cost as well. Similarly, opportunity cost of perishable demand is another element that needs to be included to get the whole picture. Tying front-end and market information to the supply chain can help gain these insights.

Tune the Supply Chain to the Demand

Many companies worry about keeping a steady supply of inventory on the shelves instead of better understanding the ebb and flow of demand. Conventional wisdom suggests inventory placed closest to the customer will help meet demand. But what if inventory was replaced with information?

With the right data, organizations can ensure that product is not only available when the customer wants it, but also at the right time, in the right quantity and at the right price, giving the organization a competitive advantage.

Two key supply chain factors can make the difference: forecasting and lead time. Forecasting, coupled with product segmentation, can predict which product meets customer demand. Reducing lead time for the right products can allow for quicker response time to meet customer demand.

But just as the paint industry evolved from forecasting individual buckets of green, blue and yellow paint, to reacting to current demand by mixing paints in the store, a demand-driven supply chain could mean cornering the market for a new product introduction.

A supply chain that helps its business react to real demand helps build game changing products and business models.

Analytics is the Answer

Over the past few years, analytics has become an increasingly prominent term in the C-suite’s vocabulary. Most business leaders, however, have not figured out how to integrate analytics into their operations and how it can be a driver for innovation. Turning data into meaningful insights is a challenge, but one which can lead to new business ideas and processes.

For many companies, the simplest form of analytics is looking at customer demands and patterns; then leveraging the gathered insights to build innovative and differentiated services—delivering greater value to the consumer and the businesses bottom-line.

A wireless networking company, for example, used segmentation analysis to provide them with insights into market behavior for different customer channels. With the proliferation of new products and configurations, they had lost sight of the subtle market dynamics that were influencing their demand. Through segmentation and forecast analytics, they were better prepared to have the right inventory closer to the market segment with high demand for certain products and configurations.

The supply chain is an untapped source of this crucial business data.

How to Take an Idea into Practice

To look at how the supply chain can be a differentiator, organizations need to ask themselves a variety of questions:

  • What’s our new big idea?
  • How does our supply chain influence those big ideas?
  • What are the drivers behind customer behaviour that are being enabled by the supply chain?
  • How can our supply chain strengths be exploited to bring a new product or service to market?

To answer these questions, organizations need to start looking at their supply chain through the lens of the marketing and product management teams.

In general, the supply chain is an afterthought, brought into the fold late in the product design and manufacturing stage. Bringing marketing, product managers and even engineering teams into the supply chain fold can help enable big, creative ideas. When the supply chain is brought into the early ideation and design process, it can truly function as a hub for growth and innovation.

Going back to the paint example, when a hardware store sets a goal to deliver any color of paint to their customer within 30 minutes, it forces them to think about meeting that goal in a completely different way than simply shaving a day or two off of their product delivery times. Integrating a manufacturing process that takes advantage of the supply chain to customize paints in the store created a key differentiator.

Setting “Big Goals” will force that type of out-of-the-box thinking. Harnessing the power of the supply chain can help be the key differentiator to meet those goals and approaching the supply chain with an open mind can open up new markets and product lines.

To keep with the theme of paint, when looking at a piece of art, it is important to take a step back, and not focus on any individual color or stroke, but rather see the bigger picture of how all the elements work together.

 

 

 

 

 

 

Posted in Miscellanea


Will that be automatic or semi-automatic to manage your supply chain?

Published January 16th, 2015 by Christopher Hatcher 1 Comment

semi automatic software blog chris hatcherYears ago when I was in the army, one of the most memorable days of my mostly forgettable BASIC training experience was flipping the switch to automatic. Yes, we’re talking about the M16 rifle standard issue weapon for soldiers. We were trained on this weapon out at the firing range where we learned to hold the weapon steady, breath calmly, and ignore the clamor of dozens of shots ringing out through the earplugs nestled in our ears.

It was cold out in Missouri in the middle of winter, but it was a bit of a thrill to do what I’d done as a kid with toy guns. This was the real thing. Well, sort of the real thing in the sense that the weapon and bullets were real, everyone was dressed in camouflage fatigues with serious looks on their faces, but the targets that popped up anywhere from 50 to 300 meters away were just some special fabric that fell over if a bullet whistled through it.

What we learned was that the cowboys shooting from their hips and hitting their targets was a fantasy of Hollywood. Hitting the targets required patience, focus, and a bit of luck. Like most training in the Army, the thought was that if you do it long enough it would become ingrained in your psyche and muscle response. As it turned out, after months of training out at the firing range I qualified as a Marksman, but that was not the big thrill. The big day was actually at night when we were allowed for the first time in months to flip the little switch on the M16 to automatic. Up until that night, each shot was aimed, the trigger squeezed and the result was immediately apparent.

Either you hit the target and it plopped over or you saw a wisp of dirt fly up in the air a bit to the right or left. With the switch now set to automatic each second of squeezing the trigger spat out 10+ bullets. Even better was every 5th bullet being a tracer round so they glowed red as they buzzed through the air at 3300 feet per second. I can’t remember if I actually hit any targets that night, but it was so cool to try the automatic setting and live the Star Wars experience for a short moment in time. That was 30 years ago.

Now what does this have to do with managing a supply chain?

Or as my old drill sergeant would have said it… “What the f%$*& do you f$#@&*ing think you’re f%^&@#ing doing, son?!

Hear me out. There is so much supply chain related data that we have access to now and even better, we have automated solutions that recommend the best thing to do in a given situation on a given day. That’s a good thing, because we don’t want to go back to managing everything. We need to manage by exception and keep our focus on the big problems. One thing to keep in mind is that many of our automatic solutions turn into black boxes over time. The smart guys that built the solution are long gone and it seems to be working fine, so just let it roll, right? Well, the devil is in the details, and despite the agony of digging through the logic of work done in the past, if the automatic answer is not as good as it could be, there are likely a few tweaks that could be done to the process to make it more fruitful in its results.

An example of this is the automatic pull in messages that can be acted upon when the available date of a sales order improves to earlier than its due date. Well, if no orders are harmed by pulling in the sales order to an earlier date, then why not do it? Remember first, that an automatic solution is based on certain assumptions and filters. Does the Automatic solution consider Priorities on the sales order? Perhaps an earlier low priority order can ship on time while a later high priority order will ship late due to constrained supply? Maybe the high priority order, although later, is for a very important customer so we should honor the priority setting and the supply should be set aside for a few days to ship to our valued customer?

What do we do? Flip the switch back to Semi-Automatic to manage your supply chain? In this case where constrained supply allows only 1 of 2 sales orders to ship on time, a supply planner should be able to intervene and decide which order to ship. Planner A good supply chain software solution must first identify such cases where the semi-automatic (human involvement) approach is recommended, then be able to quantify the appropriate metric, which solution path is better, and finally notify the right individual to intervene quickly enough to make a difference. Software solutions like Kinaxis RapidResponse can provide the filtering, scorecard metrics, and alerting needed to guide the planner to make the right decisions. Over time, as the calculations that drive this semi-automatic approach are in need of fine tuning, the filters and metrics can be easily changed as necessary.

Running most operations in automatic mode is likely a wise choice, but it’s important to understand which parts of the process can trigger the responsible party to intervene when necessary. Automatic sometimes scatters a lot of bullets with a great deal of sound and fury, but semi-automatic usually hits the target every time.

Do you prefer semi-automatic or automatic to manage your supply chain? Or, perhaps a combination of both? How has it benefited you? Comment back and let us know!

 

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


2015 New Year’s Resolutions for the Supply Chain Industry

Published January 2nd, 2015 by CJ Wehlage 3 Comments

2015 New Years Resolutions for the Supply Chain Industry2015 will be my 25th year in the supply chain industry, mostly as a practitioner. I’ve had the benefit of stepping away from the grind for 2 years, spending time at AMR Research, where I visited with many companies and learned about their supply chain practices. As well, these past 2 years at Kinaxis have brought great insight on the operational challenges of supply chain leaders.

Which brings me to today… I was planning out my 2015 supply chain conference schedule, and noticed the conference themes: Digital, Green, Internet of Things and Social. These are what I call “Cool Theme” topics. But after my 25 industry years, I find that the fundamentals of revenue, profitability and service are the still most important themes. It feels like we’ve drifted away from the fundamental supply chain strategies. So, I decided that 2015 needs to be a re-focus on the hard core fundamentals of supply chain success. And change in the New Year begins with resolutions…

 

My 2015 Resolutions for the Supply Chain Industry

Resolution #1 – Stop using the term VISIBILITY

People say that information is power. I beg to differ. I say, an informed decision is power. The visibility term has been over used. I’ve even heard some say that getting visibility to your supply chain is 80% of the challenge. They must not have run a supply chain. I see many supply chain leaders that have visibility, some in excel and some in automated tools. The ones that don’t have visibility can easily call the supplier and get it. Getting visibility isn’t the challenge. The real 80% challenge is “what are you doing with the visibility?”

  • Are you using visibility to eliminate searching for exceptions?
  • Are you setting control limits on your visibility to set planning priorities?
  • Does your visibility provide a proactive view into supply chain challenges?
  • Are you doing the #1 supply chain best practice, simulation, with your visibility?

Most supply chains can actually answer these questions, but with multiple spreadsheets, phone calls, MRP runs, and planning modules; in essence, without having agility. With today’s complexity, these questions need to be answered in seconds, concurrently across multiple exceptions. Yet, supply chain leaders seem to be stuck in the strategy of incremental change. Problem is: supply chain complexity is growing exponentially, customers and competitors are becoming more global, and the time to make decisions is shrinking to minutes instead of days and weeks.

This lack of urgency is driven by the “Supply Chain Anarchists”. This is a group that tries to undermine the best efforts of supply chains.

The Supply Chain Anarchists had a meeting in late 2014, to figure out a way to stop supply chain progress. The first person said, “Let’s tell everyone that there is no Complexity”. The others thought about it, and said, “that’s good, but people will still be on late night conference calls with far off suppliers, and have to travel around the globe for supply chain issues”, so that won’t work.   The next person said, “Let’s tell everyone there is no Risk”.   After a while, the others said, “that’s interesting, but there will be another earthquake, flood, or political event, and people will see the risk”. So, they thought some more, and one person said, “I got it”. “Let’s say there’s no Hurry”… Supply chain leaders don’t need to change their strategy this year.   You can make small, incremental improvements in 2015. It would be difficult to align all your partners. “Things can wait for now.” They all agreed, that’s the ticket. We will stop supply chain progress by making people think “there’s no Hurry”…

My #1 resolution for 2015 is to drive that sense of urgency to change. Informative decisions across your entire end-to-end network are needed now. You need to proactively simulate issues. You need to make your supply chain THE differentiator. The traditional horizontal Plan-Buy-Make-Deliver model is gone. Disintermediation is happening to your supply chain as you read this. Look at what Amazon is doing to the Deliver model. You need to be using visibility to bring value and differentiation.

 

Resolution #2 – Read only ONE “Cool Theme” report

In 2014, I saw the emergence of Cool Themes from all the Analysts. The digital supply chain, green supply chain, internet of things, and the best, social supply chain.   What happened to the core fundamentals of revenue, profitability and service?

In 2015, I resolve to read only one Cool Theme report. I’m tired of research analysts peddling these themes as a means to gain an edge on readership. Yet, I watch the audience during some of these Cool Theme presentations. And, half the people are on their smartphone working core issues back home, while the Analyst is talking about how supply chains should save the Panamanian golden frog, reduce the ozone layer, produce products with plastic wire from 3D printers and generate forecasts from Facebook posts!

 

Resolution #3 – Stop moaning about Bad Data

Let’s face it, everyone has some form of bad data. And, when you include all your tiered suppliers, they have bad data. The one constant is that you will never fix all the internal and external bad data. Yet, I still hear supply chain leaders say they need to focus first on fixing the data. I’ve seen many presentations from “Top 25” supply chains and how they’ve cleaned data, and why they should be considered a top tier supply chain story. This reminds me of my farmer friend…

I needed to borrow an auger from my farmer friend. He has many tools, and I went over to his farm. His wife said he was out in the barn. When I turned the corner to the back side of his barn, I saw him with a Hoyt Spyder Turbo bow and arrow – Top of the line and expensive. I looked at the side of his barn and saw 17 bull’s-eyes. And in the middle of each bull’s-eye was an arrow… dead center! I stuttered to get my words out, and said did you do that. To which he said yes. I turned back around and looked at the side of the barn, and asked him how long he’s had the bow and arrow. He said about 2 weeks. I said, only two weeks? That’s amazing! 17 bulls-eyes, 17 hits in the center of each bulls-eye. You’ve only practiced for 2 weeks. How can you be so accurate? He said it’s easy. I shoot first and they draw the bull’s eye around where the arrow hit!

I’ve seen many supply chain presentations that are like my farmer friend. They appear more on target than they actually are. They may talk about cleaning all the data, but the truth lies in using both good and bad data. The thing leaders should focus on is executing to what data is there and, where there’s bad data, use simulation tools to make up the difference.

And that’s the resolution to make. It’s okay to moan about bad data. But, don’t let bad data dictate your execution. The best simulations I’ve seen have focused on supplementing the bad data. Sort of like the scientists in Jurassic Park – where they supplement frog DNA code to make the dinosaurs.

 

Resolution #4 – Fix the Disruption you can influence, not the Disruption you are concerned with

There are two types of disruptions. That which you are concerned with, and that which you can influence.

Volatility, regulation, geopolitics, economics, energy, and the list goes on. These are in your Circle of Concern. They happen, and you should be concerned. Yet, many supply chain leaders face fail to focus on the Circle of Influence, the area where you can make a difference.

There are two methods to manage your Circle of Influence. The first, and most widely used, is to simulate disruptions before they happen, or quickly after they occur. The second, and not widely used, is called “responsibility based collaboration.” It’s having the right people, with the right information need to make the right decisions, in the right time. Without responsibility based collaboration, too many people are involved. Redundant work is processed. Planners feel dis-empowered. The process of resolving the “disruption” is creating more disruptions.

Core questions to assess your level of responsibility based collaboration:

  1. Are senior managers as close as possible to the decision?
  2. Can the decisions be implemented faster?
  3. Do those making decisions have the detailed understanding?
  4. Does the decision account for “carnage” created elsewhere?
  5. Are all the impacted departments aware of the tradeoff?
  6. Are Planners feeling more empowered to analyze and decide?

Concurrent, responsibility based collaboration is needed in 2015.

 

Resolution #5 – Scrap the Talent Research, Make Planners more Productive

After reading all the Talent Research done in 2014, the topics of attrition, retiring professionals, and university-business alignment, I notice a big gap. The one thing missing in all this Supply Chain Talent research is the concept of being more productive with the talent you already have.

How can every supply chain improve productivity? In every supply chain I’ve seen in my past 25 years, there’s one constant – they all use some form of Excel – mostly to search for exceptions. Planners spend half their day dumping ERP and BI data into Excel, and then search for exceptions.

And that’s not even the biggest problem! Once a Planner finds an exception, they work to resolve it. Yet, 80% of the exceptions found don’t actually break and end-to-end control limit. So, the Planner, after half a day searching, is now working on the wrong exception. And, even worse, that Planner resolves the exception without concurrently understanding how they’ve impacted other areas. That’s called “carnage” – aka “next week’s exceptions”.

This is the main reason I love the Kinaxis solution. Single code, pulling end-to-end data, running all the time, in memory fast, alerting Planners only when control limits break, and providing concurrent understanding of how a resolution impacts all nodes of the network.

The result is that Planners no longer search for exceptions. That’s half the day back = much more productive. Then, Kinaxis customers use that gained productivity to simulate future issues = more proactive planning. In essence, fixing exceptions before they happen. This is the reason Kinaxis customers are “giddy”.

These are my Five Resolutions for 2015. What are your resolutions?

 

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


Best of the Best Supply Chain Blog Posts of 2014

Published December 22nd, 2014 by Melissa Clow 0 Comments

best of the best supply chain blog-posts

As you take time over the holidays to sit back and reflect, here are the top ten excerpts from the best of the best posts on the Kinaxis supply chain blog. They touch on hot topics and industry trends discussed over the past year, so grab a coffee (or a spiked eggnog) and enjoy! We look forward to continuing the conversation in the New Year.

#1 “And much as we have had to rethink the first applications that were simply a digitization of a paper-based paradigm, we need to rethink how we structure our organizations and get work done to get maximum utility out of the digital world.”
FROM SMAC in the Middle of Supply Chain Change

#2 “Visibility is losing its clarity.”
FROM Visibility is Losing Its Clarity

#3 “The ‘ah-ha’ moments are the catalyst to innovation.”
FROM “Storage Wars” Rescues Supply Chain Ignominy

#4 “Many companies have several instances of ERP, each deployed differently. Despite many moving to a single instance of ERP there are still many ‘shadow IT’ required to do what the core ERP solution cannot. And then there is the planning layer, which is even less harmonized or standardized. Most business people consider this an IT problem. Guess what? It isn’t going away until the business makes solving the data issue their issue.”
FROM Gartner Supply Chain Leaders Conference – What Will Be Hot?

#5 “Tell me if you’ve heard this one before. Your company has implemented an S&OP process. At first it showed some promise, but now it has turned into a blamefest, attended – if at all – by lower level representatives that aren’t empowered to make decisions.”
FROM Poorly Executed or Non-Existent S&OP Is Costing Your Supply Chain Money

#6 “…a supply chain planning system of record should be focused on how it can drive tangible business outcomes not just on how to run the supply chain planning function.”
FROM Gartner’s Magic Quadrant for Supply Chain Planning System of Record

#7 “…Yet my contemporaries are the ones making large decisions about organizational structures, processes, and solutions that are rooted in mental models developed and perfected in the 1970s and 1980s. And far too many of the analysts and management consultants continue to position these mental models as best practice. They are not; they are yesterday’s practice.”
FROM Do Supply Chain Planning Systems Generate Any Value?

#8 “Collaboration is not about ’being social’, it’s about making information available, connecting people and improving business processes.”
FROM Purposeful Collaboration: What It Could Mean for Your S&OP Process

#9 “… even the smartest people can juggle no more than nine variables when making decisions. Since there are a lot more than nine variables that need to be considered when making a cross-functional decision in supply chain, the solution was to eliminate the people and let a machine make an ‘optimal’ decision. It is time that we corrected this imbalance.”
FROM The Eternal Dilemma of Decision Making: Human Judgment or Machine Optimization

#10  “Supply chain visibility alone won’t yield effective supply chain orchestration; it is a prerequisite capability, among others.”
FROM Overcoming the Challenges to Achieving End-to-End Supply Chain Visibility

 

Posted in Control tower, General News, Inventory management, Miscellanea, Supply chain comedy, Supply chain management


Kinexions, a tale of growth and potential

Published December 9th, 2014 by Trevor Miles 0 Comments

building-kinexions-trevor-milesI’m on my way back from Tokyo where I attended our user conference, Kinexions Tokyo, in Japan, just 5 weeks after our Kinexions North America user conference in San Diego. As a side note, I had a stunning view of Mount Fuji from my hotel room on two of the three days I was in Tokyo. I have become so lazy about carrying a camera with me that I could only capture this photo with my smart phone.

If attendance at both conferences is anything to go by, 2015 is going to be even busier than 2014. In both cases we had about 50% increase in attendance over last year. In both cases we had the largest contingent of prospects ever and the largest contingent of partners ever. We also had the most customer presentations with 11 case studies in total including:

• ASICS
• Avaya
• Buffalo Technologies
• Dow AgroSciences
• Keysights
• Schneider Electric
• TE Connectivity
• Qualcomm

Kinexions `14 graphic recording

Kinexions graphic recording

The diagram above captures the essential elements of the San Diego conference in which you can see how important the customer case stories were to the overall conference. What struck me most is the diversity of the industries and the breadth of supply chain maturity represented. Before I comment further on specific stories, let me state that while the destination reached is important, it is the distance traveled that most impresses me. In other words, while I love the stories of the customers that are doing amazing stuff, it is the one that changed the most that really impresses me. For example, you only have to look at the Gartner Top 25 to see that Apple has been number one for the past 5 or so years. Yawn. I’m always looking for the companies that have started low in the ranking and are making rapid progress up the ranking. Change is hard, but change is necessary. It is easy to follow, and a lot more difficult to lead. Or, as Angel Mendez of Cisco likes to say, yesterday’s stretch goal is today’s benchmark.

And our customers are leading the charge in the transformation of supply chain, which is captured nicely in our tagline of ‘Know Sooner, Act Faster’. At the conference, that transformation was captured best by a pharmaceutical manufacturer and Schneider Electric. Their industries couldn’t be more different and their product portfolios and supply chain structures couldn’t be more different. But both were faced with deteriorating market positions a few years back that have necessitated huge transformations in their organizations, with supply chain being at the heart of the change. The pharmaceutical manufacturer was facing a massive patent cliff with many small molecule blockbuster drugs reaching patent expiry and have now made a radical shift into biotechnology. Schneider Electric has grown by acquisition and was faced with shrinking margins because of inefficient and poorly thought out supply chain operating models. Both companies needed to do something radically different. They both chose Kinaxis as the enabler of that change. Both realized that they could not transform their organizations by following the 1990’s supply chain mental model of functional optimization. You can’t cross the Grand Canyon in 10 min by walking. You need a helicopter for that.

Schneider said it best: The speed at which information flows across the supply chain is more important than what gets done with the information at each node in the chain. Now, to be honest, in my opinion they are expressing the area in which they had to make the largest mental leap, the greatest transformation. I would reword Schneider’s statement to state that the speed of information flow is just as important as what gets done in each functional box. In fact, I am not much of a fan of simple visibility solutions. What really matters is the speed of decision making, and that takes more than transmitting information quickly or being able to calculate quickly. You need both. This is the ‘Know Sooner’ part. And you need a third element too. You need to be able to bring people together as a team to make trade-off decisions quickly, as well as capture all the assumptions and provide a full audit trail of the decisions made. This is the ‘Act Faster’ part.

To be honest, our customers typically find it easier to describe the barriers to change and the inefficiencies of their previous operating models, than the new capabilities adopted. And this is true for most companies, and is where Avaya comes into the story, and to some extent Buffalo Technologies. Avaya have turned the value pyramid on its ear to focus on the real value generation of prediction/action/innovation. Dick Ling, the ‘father’ of S&OP said it best: It is far better to be approximately right than precisely wrong. Your data is never going to be 100% correct. You processes are always going to be in flux. Move on. Focus on how people will use the information you have to make a decision that will drive the company forward. At some point speed is quality. Plan. Monitor. Respond. In days, not months. By focusing on speed of decision, and quality of decision, Avaya has posted some truly amazing financial and operational gains. Obviously it is up to Avaya to share these gains publicly.

Avaya Kinaxis supply chain conference slides

Josh Greenbaum wrote a great summary of his impressions of the Kinexions conference in San Diego, specifically the unusually high number of women in attendance. Josh makes the point that it is perhaps our focus on supplier collaboration that draws more women to Kinaxis. If that is true, it is a most welcomed side benefit. To be honest I do think women are better at driving consensus and making compromises through trade-offs. Whether this is true because of nature or nurture is far beyond the scope of this discussion. What is important is the realization that the speed and manner in which people reach agreement across competing objectives is really important, and that it is a consensual process. If women are better at this, then all the more reason to bring them into senior leadership roles to drive change. We need the change. And we need more women in supply chain.

In wrapping up, let me give a quick shout-out to Watanabe-san of Abeam Consulting who presented the keynote in Japan. I ran a panel in San Diego discussing the technology innovations that will drive change in supply chain management. This was theme of Watanabe-san’s presentation, but he did a much better job of giving concrete examples of how these technology changes have already made changes to supply chains. My only (admittedly selfish) wish was that he has used English slides. I could only follow along on the simultaneous translation. For example, he used IKEA as an example of crowd sourcing in supply chain. After all, they are relying on the ‘crowd’ to do the final assembly, which has a radical impact on their cost to manufacture, distribute, and sell their products. What I found interesting was the manner in which he made new terms familiar and less alien, and therefore easier to accept and adopt.

So, all in all, a really positive set of conferences providing a great launch pad for 2015.

 

Posted in General News, Milesahead, Miscellanea, Pharma and life sciences supply chain management, Supply Chain Events


Kinaxis Receives Two Awards at the Best Ottawa Business Awards Gala: Deal of the Year and Outstanding Company

Published November 21st, 2014 by John Sicard 2 Comments

Kinaxis Best Ottawa Business Awards Company of the YearLast night I had the pleasure of attending the Best Ottawa Business Awards in Ottawa, Canada where Kinaxis was recognized for Deal of the Year and as an Outstanding Company.

As an Ottawa headquartered company and a business that has been very successful over the past few years, we are delighted to be a part of the business growth and success of Ottawa.

I believe our success over the years can be contributed to our strong value proposition to our customers, as supply chain becomes increasingly important to large companies.

Our success can be seen in the 20% increase in head count over the last year – And we are continuing to grow! If you’re interested in joining our team, find out more about Kinaxis career opportunities at the upcoming career fair on Wednesday, January 21st, 2015 from 4:00–7:00pm at the Holiday Inn & Suites Kanata.

To view the other award recipients, please see bestottawabusiness.com.

Recognition in this category adds to the growing list of accolades Kinaxis has received: 2014 Canada’s Best Small & Medium Employers,  2014 National Capital Region Top Employer, 2013 Canada’s Best Employers for Young People, 2014 Supply Chain Pros to Know, 2014 100 Great Supply Chain Projects and 2013 Great Supply Chain Partner.

Posted in Awards, General News, Miscellanea