Archive for the ‘Sales and operations planning (S&OP)’ Category

Supply Chain Metrics That Matter: A Focus on Aerospace and Defense

Published July 14th, 2014 by Melissa Clow 0 Comments

metrics that matterJust a quick post to share some research courtesy of Lora Cecere of Supply Chain Insights LLC.

Supply Chain Metrics That Matter: A Focus on Aerospace and Defense

Increased complexity, slowed growth and shrinking margins are challenging the Aerospace and Defense (A&D) sector. According to recent research from Supply Chain Insights, A&D companies need a renewed focus on collaboration, visibility and core supply chain capabilities to remain competitive and win new business.

In Supply Chain Metrics That Matter: A Focus on Aerospace and Defense, Supply Chain Insights benchmarks A&D companies against other industries and dives into data from five top A&D companies over the last decade. The research highlights the supply chain challenges for this industry, as well as the critical importance of getting it right.

Complimentary report courtesy of Lora Cecere of Supply Chain Insights LLC.

Get the supply chain research >>

Posted in General News, Sales and operations planning (S&OP)


4 Parallels between Planning a Wedding and Supply Chain Planning

Published July 9th, 2014 by Melissa Clow 3 Comments

wedding-planning-supply chain planningI got married on June 28th. After 7 years together, we decided to make it official. To be honest, I never had much interest in planning a wedding so I had lots to learn. As exciting as it was, at times the task was daunting: venue, guest list, colors, theme, bridal party, transportation, music, photography and of course the dress.

Throughout the nine months we took to plan, I realized there are a lot of similarities between wedding planning and supply chain management. Here’s my top 4 list on the parallels between the two:

4. Disruptions

To no one’s surprise, I learned that wedding planning does not always go smoothly.

Just like supply chain management, there will always be disruptions –it could be a small disruption like your parents invite people that weren’t on your original invite list or a larger one, like what a Saskatchewan couple experienced last week on their wedding day… a tornado! Despite this, their photographer was able to think quickly and capture some breathtaking photos.

Lesson learned: There will be bumps in the road but you can’t dwell on them; they need to be dealt with rapidly and maybe even a little creatively.

supply chain disruptions wedding

For business, competition continues to grow. Responding rapidly to changes is critical, whether it is ordinary daily order changes to large and unexpected supply chain disruptions such as strikes, blockades and regional tragedies. We can no longer predict the future with acceptable levels of accuracy, and so the success or failure of supply chains is dependent on how quickly and effectively stakeholders can understand and respond to evolving situations. Once you know the impact, you need to act quickly to simulate the various scenario alternatives and find the best solution. The timeliness of resolution is a key factor in mitigating any potential damage to your operations.

Risk management

wedding supply chain risk managementWe contemplated who we would ask to give a speech. For example, do you ask your husband’s friend to make a toast even though you know there’s a very good chance he will say something offensive? We decided to decrease the risk of any bad behavior by our friends and kept speeches to a minimum by only asking the best man and maid of honour to speak.

In supply chain, it is not just about avoiding risky situations, supply chain risk management has a component that many companies fail to consider; the ability to respond:

  • Even the best thought out mitigation strategy may fail when the time comes to implement;
  • events that you couldn’t have imagined (or considered too low a probability to worry about) during your risk assessment may in fact come to pass; and very importantly,
  • small events, which may be considered insignificant on their own, but that taken in sum become a large risk consideration if not managed effectively.

It is important to be proactively alerted to urgent issues before they turn into major problems.

Collaboration

Because there are so many aspects that go into successfully pulling off a wedding, it’s really important to have a good working relationship with all your vendors. One challenge that we ran into with our venue, is that every time we spoke about our wedding plans we were passed along to a different wedding coordinator to help us… and more often than not, it wasn’t the person that would be there to help us the day of. This was a little unnerving because without telling our coordinator firsthand, it felt like we were playing telephone. Getting on the same page is key since these are the people that are going to help you execute your big day.

Just like collaborating with all your vendors, guests, bridal party, those in supply chain now need to coordinate with a number of tiers in the value chain network. Because of that, supply chain visibility and supply chain coordination has been reduced and often made the brand owners dependent on suppliers for their business and operations performance results.  To be truly effective, supplier collaboration needs to go far beyond the tactical exchange of data. Key suppliers must actively review information and directly contribute to the decision-making process so that companies can exchange early warnings and collaboratively resolve supply chain risk issues. Better supplier collaboration improves the flexibility of a supply chain and the profitability of the enterprise. 

Talent

We hear a lot about supply chain talent and how important it is to build up less experienced supply chain professionals to operate an effective and efficient supply chain. The same could be said for those getting married. We certainly needed and appreciated our friends and family that supported us throughout the wedding planning process. Without their support and advice, we wouldn’t have been able to pull it off, or at least not as well.

Just like we received a lot of sage wedding and marriage advice from married friends, colleagues and acquaintances, many organizations are creating formal supply chain talent-management programs to help transfer knowledge to cultivate growth. Often, these programs aim to engage both the mentors and the mentees by providing opportunities for a connection and growth. And now, more and more colleges and universities are offering undergraduate- and graduate-degree programs in supply chain management to better prepare younger supply chain professionals to enter into the field.

 

All that said, I can officially say we did it! And I can’t wait to give advice to future engaged couple thinking about planning a wedding.

Happy Wednesday!

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


The Future Supply Chain Workforce: Can Supply Chain Organizations Balance Their own Demand and Supply?

Published June 2nd, 2014 by Lori Smith 1 Comment

future of supply chain workforceThe central theme of the Gartner Supply Chain Executive conference last week was all about supply chain leading the next decade.  I too believe this to be the case – both out of necessity and because of the progressive evolution of the function. But a function doesn’t lead, people do.  So who are these people that will manage and contribute to supply chain management in the next decade?  Well, going by the sessions at the Gartner conference, there will seemingly be a lot of roles that will be difficult to fill, and for those roles that are occupied, they will be increasingly held by women and many millennial. The face of supply chain is most certainly changing, and it’s happening at the same time as the profile and dependency on supply chain is intensifying.  Ironically, for an industry that is all about balancing supply and demand, there doesn’t appear to be much balance when it comes to its own human resources going forward.  It’s time for supply chain organizations to do a reality check and apply some basic planning and course correction initiatives within their own internal organizations.

Consider these opposing trends that are driving significant resource gaps (thank you to keynote speaker, Linda Topping, Vice President, Chief Procurement Officer at Colgate Palmolive for some of the stats included below):

Increasing demand

# of supply chain jobs will rise 25% in next decade.

Shrinking workforce

25% of workforce will reach retirement by 2015.

How do you fill more jobs with less people?

Increasing capabilities required

Less than 20% of today’s workforce have the skillset required.

Depleting experience and lagging academia

As experienced workforce retires, key supply chain competencies will depart along with them. And while the number of supply chain university programs is increasing, the scope and depth of curriculum is lagging behind current needs.

As supply chains become more complex, the sophistication of the supply chain function is increasing and so too must the analytical capabilities of the people that run it. Where will that come from?

More millenials

Millennials will account for 36% of the workforce by 2015, and 75% of workforce by 2025.

Slow to change organizations

Millennials expect:

  • Personally fulfilling work
  • Sense of culture and community
  • Flexibility
  • Career movement
  • Flatter, less-hierarchical organizations
  • Social and collaborative environments
  • Highly technology-enabled work

Millennial’s want more out of their work environments and because of the industry’s resource constraints they will have the power to demand it. Who will fight or face this fact?

Increasing capability needs

According to a session I attended on “Revelations from Gartner’s 6th Annual Supply Chain User Wants and Needs Study” by Gartner analyst, Dwight Klappich, the basic conclusion is that while organizations talk about the urgent need for transformational and innovative technologies, for many, their activities and investments remain very tactical and focused on maintaining existing technologies.

Despite survey respondents citing that among their top supply chain challenges were the inability to orchestrate the end-to-end supply chain, and the lack of cross-functional collaboration, 61% of technology investments are made with the goal to reduce operating and support costs.

Continued investment in legacy technology systems

Paraphrasing the presentation, companies continue to spend on the technologies they already have in place; they are investing in what they know, instead of what’s new.

There is a disproportional amount of money going to just “keep the lights on”. Less than 20% of budgets are spent on technologies intended to transform the business, whereas upwards of 50-70% is spent on technologies that run the business.

Make no mistake, technology is a resource issue. Technology is what can enable efficiencies that require less people. Technology is what can arm supply chain decision makers with the advanced analytical capabilities that today’s supply chain complexity necessitates. Technology is what can satisfy the millennial’s appetite for effective and “cool” ways to work.

Ultimately, technology is what will enable the supply chain to lead in the next decade.

There is one trend that is going in the right direction I believe… the increasing quantity and prominence of women in supply chain.

I know this topic has been talked to at length, even on this blog (and we have an upcoming webcast on this topic as well – get more details here), but it hit home again for me at the Gartner conference.  It was satisfying and inspiring to say the least, to see that women represented the majority of the main-stage sessions – 5 out of 8 speakers in fact.  And they were informative and engaging speakers on top of that, leaving no doubt to anyone their credibility and effectiveness…not that this was something they needed to prove.  These were not women supply chain leaders; they were simply supply chain leaders.  And to me, that should be the goal as we look towards defining the next decade.  It shouldn’t be about categories of people, but about their skills, experience and success.

Having said that, I do believe today’s environment does favor a women’s strengths if we were to generalize.  I think Tom Peters (influential business thinker & co-author of In Search of Excellence), also a Gartner keynote, said it best. “Guys do hierarchy well, women do ambiguity well.”  In a time of complexity and variability, effective supply chain management becomes about consensus decision making and collaborative trade-offs. There is certainly an argument to be made that managing in these conditions could come more naturally to females (the same could be true for millennial with their innate social and collaborative predispositions).

The mission will be to make sure companies enable these leaders with the organizational structure, processes, culture, and technologies that are required to empower them in new and evolving roles.  Given the demand, those that don’t take this to heart will no doubt be scrambling for supply.

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Posted in Sales and operations planning (S&OP), Supply Chain Events


Clearly, A Must See at Gartner Executive Supply Chain Conference

Published May 9th, 2014 by Bill DuBois 1 Comment

It’s another exciting time for the Kinaxis team as we gear up for the 2014 Gartner Executive Supply Chain Conference. I’m especially excited to be back hosting the Late Late Supply Chain Show once again. This year our theme is “Achieving “3D” Vision: Defining, Designing, Delivering End-to-End Supply Chain Processes”.

Along with our own Late Show favorite, Trevor Miles we’ll be joined by a panel of experts to clear the air on supply chain visibility. Trevor has written extensively on the challenges associated with achieving true supply chain visibility and the changes over the years that’s driving the complexity.

Trevor and the panel will provide real world examples of what you can do to overcome the challenges associated with global visibility but I, for one don’t think it’s that complex. I simply put on my Google Glasses, searched supply chain visibility and got all the clarity I needed. With my Google Glasses on, here’s what I see:

True Supply Chain Visibility is more than just seeing what’s in front of you.

You need to understand what’s going on around you.

supply chain visibility6

How that will affect you.

supply chain visibility5

How it will affect others.

supply chain visibility4

You need to see the big picture.

supply chain visibility8

Sometimes things aren’t always obvious.

supply chain visibility2

Focus on what’s important to drive profitability and reduce costs.

And most importantly you need to feel as close to those Supply Chain partners as if they were right next to you.

supply chain visibility

 

Call me a “glass hole” but I think that’s all there is to it. I’m sure Trevor and the panel will clear up anything I’m missing. If you’re at the conference, be sure to drop by the Kinaxis booth to say hi and join us for the Late Late Supply Chain show. If you can’t make it look for our post conference summaries here on the 21st century supply chain blog..

 

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


Part 3: My thoughts on Gartner’s Magic Quadrant for Supply Chain Planning System of Record

Published April 22nd, 2014 by Trevor Miles @milesahead 0 Comments

I was recently asked three questions on Gartner’s Magic Quadrant for Supply Chain Planning System of Record. As I said earlier, I want to share these videos with our readers…

The three questions I was asked were:

  1. What do you think of the Gartner Magic Quadrant for supply chain planning system of record?
  2. In your opinion, how does RapidResponse differentiate itself as a supply chain planning system of record?
  3. From your experience, what is the level of understanding of planning systems of record in the market?

Here’s my response to question #3. If you haven’t checked out my response to question #1 and question #2, you may want to view them first. Enjoy!

The report positions vendors based on completeness of vision in the supply chain planning system of record market and on their ability to execute to that vision. If you’re interested in reading the full report, the Gartner document is available upon request at http://kinax.is/Gartner.

Posted in Control tower, Demand management, Milesahead, Sales and operations planning (S&OP), Supply chain collaboration


Part 2: My thoughts on Gartner’s Magic Quadrant for Supply Chain Planning System of Record

Published April 17th, 2014 by Trevor Miles @milesahead 0 Comments

I was recently asked three questions on Gartner’s Magic Quadrant for Supply Chain Planning System of Record. As I said last week, I want to share these videos with our readers.

The three questions I was asked were:

  1. What do you think of the Gartner Magic Quadrant for supply chain planning system of record?
  2. In your opinion, how does RapidResponse differentiate itself as a supply chain planning system of record?
  3. From your experience, what is the level of understanding of planning systems of record in the market?

Here’s my response to question #2 (if you haven’t checked out my response to question #1, you may want to view that first).

Hope you enjoy!

In your opinion, how does RapidResponse differentiate itself as a supply chain planning System of Record?


 

You can also check out my responses to question #3 as well:

 
The report positions vendors based on completeness of vision in the supply chain planning system of record market and on their ability to execute to that vision. If you’re interested in reading the full report, the Gartner document is available upon request at http://kinax.is/Gartner.

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


Three Distinct Capabilities of Best in Class – From the supply chain leadership series

Published April 16th, 2014 by CJ Wehlage 2 Comments

supply chain leadership seriesAs I mentioned in my last post of this series, I am starting a blog series on “supply chain leadership”. I hope to pose thought provoking, and forward looking questions to executives in my supply chain network. This series will provide insights into the most pressing challenges, innovative items in supply chain leader’s budgets, and how these executives have handled talent, complexity, end-to-end S&OP, and technology. Next up is Clarence Chen, Partner at AT Kearney.  I have known Clarence from his days at PRTM as Partner of Electronics & Semiconductors.  His background and opinions on the future of supply chain is truly fascinating.

1. As we enter 2014, how would you describe the most pressing supply chain challenges?

Some of the most pressing supply chain challenges in 2014 continues to be that of delivery, quality and cost.  I think the factors that compound those challenges are changing at a faster pace than most industries are able to cope with, thereby making attainment of the core supply chain objectives even more challenging.

There are two vectors for those factors:

1)  At a geo-demographic level there are the shifting patterns of demand and growth along with cost factors rising quickly in some geographies/countries and inputs into production.

2) At a technological level, the pace of innovation continues to accelerate.  Not only is the pace of NPI increasing in technology, but that same clock speed is now moving into broad sectors as trends such as the internet of things/devices become more pervasive beyond traditional high tech penetrating into industrial, healthcare, automotive sectors, etc.

To cope with these factors, companies have to rethink the core supply chain capabilities of plan, source, make, deliver and the skills and resources required to manage supply chains in 2014 and beyond.   Companies will need to manage with greater precision, tightness, and control over their supply chain assets and partners. Those who don’t master that well will risk high E&O and overall inventories, supply-demand mix issues which impact service levels, and slow response times to changing market demand patterns

2. The End-to-End supply chain strategy has been well documented. What capabilities does your company have that is better in class for integrating end to end?

The best-in-class companies have three distinct capabilities that are more developed than others.  First is a thorough mastery of the demand management process – not just focused on forecasting, but on developing a better “quality” of demand.  This emphasizes factors such as being able to understand whether shifts in demand represent a timing issue driven by big deals, or whether the market is fundamentally at new level of demand, and then driving the rationalization of actual demand against a plan. Second is an ability to propagate demand across an extended supply chain, taking into account the key control nodes and depth of the supply chain, and balancing that against supply, inventory, service and supply chain level constraints. Third is the ability to collaborate with key long lead time suppliers to ensure that they are able to meet the forecast and execute against actual requirements. This direct control of the end-to-end supply chain minimizes bullwhip effects, and enables the responsiveness required in today’s volatile environments.

3. How aligned and connected are you to the many supply chain nodes?  What are the reasons you would want to improve this alignment?

Back in 2010, on the heels of a severe component shortage environment as companies emerged from the 2008 market downturn, I conducted a survey with 14 leading computing and storage companies to better understand how some coped better than others with the upswing in demand, and extreme supply shortages.  The findings validated that those companies with greater visibility and control of their extended supply chain fared much better in recovering supply than those companies that did not.  By visibility and control, it means that those that had visibility at component level, and sometimes at tier 3 level visibility, coupled with planning and orchestration across the extended supply could then proactively allocate precious supply to demand priorities and manage tightly the placement of P.O.s at the extend lead times. In particular, those that modeled what their contract manufacturers and key supplier suppliers (e.g. die banks with silicon devices) and were able to balance S-D at each node fared the best.

I love Clarence’s insights, especially on the main challenge: delivery, quality, and cost.  These are the core objectives from the past 20 years, and remain the core challenges.  However, as he notes, demand demographics and speed of NPI cycles are stressing the core in new ways.  Most people want visibility.  But, a lot don’t drill into the question, “What will you do with visibility?”  As Clarence notes, the quality of demand needs to improve.  What segments are relevant?  You need to propagate this relevance throughout your supply network.  What are the insights to this change?  And, then you need to collaborate with the key nodes to execute the change.

You can see those supply chains that can prioritize change, analyze the end-to-end impact, and collaborate in real time are doing so with better margin  and operating costs, capturing more market share, and controlling supply chain risk and disruptions better.

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


‘Know Sooner, Act Faster’: A Supply-Chain Mantra | Kinexions

Published April 9th, 2014 by Melissa Clow 2 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 C.J. Wehlage, vice president of high-tech solutions with Kinaxis, detail industry’s major supply-chain management challenges in particular, the difficulty of obtaining full visibility of supply and demand, and dealing with the volatility of markets. Know sooner, act faster  is the mantra offered by Wehlage as a key strategy for dealing with growing market volatility. I run into supply chain practitioners who don’t know as much as they think they do, he says.  It’s about responsiveness, and how much you know about your supply chain.

 

Previously, we featured interviews with:

 

‘Know Sooner, Act Faster’: A Supply-Chain Mantra – Interview summary

CJ wehlageIn seeking upstream visibility, many companies don’t look beyond their first-tier suppliers. As a result, crises often devolve into firefighting, rather than being averted through proper oversight of all suppliers, third-party logistics providers and even the retail store.

It’s tough to put a value on the prevention of a crisis that never happens. Still, says Wehlage, that necessary level of responsiveness is the core of supply chain.  It’s the key to how managers can influence the reporting structure within their organizations. Being able to make informed decisions, and acting on them, provides executives with a level of power that isn’t reachable through traditional methods.

Responsiveness isn’t just a tool for managing supply-chain execution; it also bears a strategic element. Decisions can be driven at the C-level, rather than occurring exclusively in the trenches.

A key competency that many companies are missing today is leadership. There has to be somebody asking the end-to-end questions, says Wehlage. What’s my profitability across this?

Yet another key element of modern-day supply-chain management is obtaining the right talent. It used to be sufficient for employees to possess functional expertise. Now, end-to-end skills are critical.

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