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

3 Lessons from Gold and Silver Pawn: This… is Supply Chain, This… is Pawn Stars

Published August 27th, 2014 by CJ Wehlage 0 Comments

3 Lessons from Gold and Silver Pawn This is Supply Chain. This is Pawn StarsIf you read my prior blog, “Storage Wars rescues supply chain ignominy”, you would have seen my garage after I moved from Boston to San Diego. Every box we collected for 16 years, stuffed in the Boston attic. And now, in San Diego, the only place to put it was the garage.  Well, here’s the updated picture of my garage. I used the supply chain ERP “shedding” theory to innovate and clear out my garage.

Just like shedding ERP when building a planning system of record, when I shed my garage, I was able to find cool side benefits. I found an “item” dating back to 1910, Carnegie, Pennsylvania.  My grandfather passed it down to my uncle, who passed it down to me. It’s a piece of baseball history from the Pittsburgh area. I’ll tell you in a minute why I cannot say what the item is.

shedding ERP vs shedding my garage clutter

Now came the decision as to what to do with it.  I could frame it and put it in my office. A home office that pretty much only I go into.  I could hand it down to my son. Or, I could sell it. I know you all would say “hand it down”, but our challenge is having a son with autism.  His ability to comprehend what the item means is limited.  His interests lie elsewhere.

So, as I was watching one of my favorite shows, Pawn Stars, I thought the next time I am in Las Vegas, this is what I will take into the Gold and Silver Pawn Shop. I did some investigation as to the process, best times to avoid the crowds, and how to get a fair price.  I found out two really important things:

  • The guys: Rick, Big Hoss, Chumlee and the Old Man, rarely, if ever, work the counter. Too many picture takers compromise the discretion of the customers.
  • Rick Harrison did something truly great for a young fan with autism.

CJ Wehlage Pawn StarHaving a son with autism myself, I was inspired by this story, and decided this “item” is going to be sold to Rick.  In January, 2015, I will follow up this blog with more details.  Suffice to say at this time, I did sell the item to the Pawn Stars, and in January, 2015, the episode will air. Until that episode airs, I need to keep the details to a summary level.

During the process, I had the chance to talk with the Pawn Stars team.  One of the most interesting –  well interesting to me, since my world is supply chain – is how they view their business.

I asked the guys what the key success factors were:

  • Know how to make a profit when buying and selling
  • Know your inventory, what needs to turn now, this week, this month, etc.
  • Think “cash-flow” at every transaction

This is so much like our world of supply chain. I asked Rick what the toughest challenge was to meeting these success factors. His answer, “determining if something is real or fake, genuine or hot”. Same applies to an end-to-end supply chain – working with bad data.

I love Rick’s view of “bad data”. He says you’re running your business on bad data today.  What you need to do is twofold. Firstly, do whatever you can to improve the data and secondly, continue to run and improve your business. Don’t wait to fix all the data and then run the business.

I’ve been in front of so many supply chain leaders who have this challenge. They have multiple ERPs, external nodes, Excel files, etc., and their data is bad. They feel that this bad data needs to be “fixed” first before doing any supply chain innovations. This is a trap that leads to an endless and expensive “master data” project. Expensive not just because of the project cost, but also because of the lack of focus on improving the business.

I challenge each supply chain leader to do what Pawn Stars does – keep the focus on:

  1. Profitability: as we improve our data, create simulation capabilities to understand the profit tradeoffs.
  2. Inventory: as we improve our data, build speed into our demand/supply processes that will drive down inventory, improving working capital and lowering carrying costs.
  3. Cash Flow:  as we improve our data, collaborate across your entire supply chain network to optimize cash flow, enabling the optimal margins for each partner, and the best cost to serve for the consumer.

Great lessons for supply chain, coming from the Pawn industry. Kinaxis RapidResponse not only provides end to end visibility of data, but also the planning models.  This critical, as you can see what bad data is impacting what model, and prioritize the focus on cleaning data.

To close, I couldn’t leave without some fun facts I learned along the way:

  • symbol of a pawnbrokerThe symbol of the pawnbroker is three spheres suspended from a bar.  Some say it’s from St Nicolas’s gift of three bags of coins to the three daughters of a poor man so they could marry.
  • Most expensive item sold at Gold and Silver Pawn shop? Four one kilo gold bars $125,000 USD.
  • Oldest item at the shop? Greek Didrachm (ancient Greek currency) dating back to 325 BC.
  • Rick’s is an expert at assessing the value of:
  • Gibson guitars
  • Rolex watches
  • Diamonds
  • Best night for business at the shop? Fight nights (boxing)
  • Who buys the most jewelry? Pimps
  • Percentage of pawns redeemed?  80%
  • Four items Rick Harrison will never sell?
  • Olympic bronze medal
  • Patriots Superbowl ring
  • 1490 Samurai sword
  • Original Iwo Jima battle plan

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


Case Study: How Nimble Storage’s Focus on Inventory Management Improved Visibility and Planning Cycle Times

Published August 25th, 2014 by Melissa Clow 0 Comments

Nimble Storage Inventory ManagementOne of the biggest challenges facing data storage companies is demands from enterprises for better performance and protection of their data.

Recently, I had the chance to chat with Stacey Cornelius, vice president of operations at Nimble.

Nimble Storage is a provider of flash-optimized data storage solutions with a powerful support model, unique in their industry. The company has a commitment to deliver the highest level of support and customer satisfaction with around-the-clock resources and four hour onsite parts replacement service.

Stacey spoke about how as their install base grew, the company faced challenges getting visibility into its more than 70 global inventory hubs and spare parts depots for its service parts planning business. Nimble was using a spreadsheet-based process to manage its service parts planning business. Data was imported and copied from a variety of sources and some of the key data was maintained only in Excel spreadsheets.

80% of the processing time included data collection and data clean up with approximately 50 steps to complete the planning process. This resulted in the process being error prone and not as responsive as was required for the growing business.

Here’s a quote from Stacey Cornelius, vice president of operations at Nimble on how they doing today:

“Nimble’s world-class customer service agreements are incredibly important to our business. As a past RapidResponse user, I know the breadth of capabilities and the flexibility of the solution. With RapidResponse deployed, we have the confidence we can keep up with our growing install base to achieve visibility of inventory at hubs, depots and parts in transit. We have the ability to quickly perform many “what-if” questions we face on a daily basis and have already reduced the time to make decisions to help our relationships with our customers.”

We also learned that because of their focus on inventory management the team realized:

  • On time delivery to customers across 70 inventory depots > 98%
  • Inventory availability > 98%
  • Service inventory as a % of installed base COGS < 5%
  • Weekly spare parts planning process went from 5 hours to < 30 minutes

Amazing! A big thank you to Nimble Storage for letting us tell their story.  We love to hear what you are doing with RapidResponse!

If you are interested in learning more about this customer, read the complete case study.

 

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


Streamlined Sales and Operations Planning: A Konica Minolta Case Study

Published August 13th, 2014 by Melissa Clow 0 Comments

Konica Minolta logoToday we have a great customer, Konica Minolta, that recently allowed us to write up their sales and operations planning story and I believe that it has merit in sharing with our readers!

At Konica Minolta, the IT Equipment Business team was struggling to get a quick and  comprehensive view of the global supply chain network.

The Japanese consumer electronics company didn’t have visibility into the impact of supply and demand changes on the business. As well, attaining agility and alignment across the supply chain was difficult.

Here’s a quote from Noboru Ota, Manager of SCM Planning, Konica Minolta on how they doing today:

“By integrating five systems into one, we gained a distinct advantage because multiple problems are solved by one product. We have the advantage of being able to streamline the operations. S&OP analysis has successfully changed from a weekly to a daily basis and now reflects the actual results, so the data is dramatically more accurate.”

And another quote from the case study:

With the deployment of RapidResponse, the team switched to daily calculations. Despite increasing the data size by seven fold (weeks to days), calculation times decreased from several hours to just minutes while supporting seamless transitions between volume and mix planning.

Very cool.

A big thank you to Konica Minolta for letting us tell their story.  We love what you are doing with the product!

If you are interested in learning more about this customer, read the complete case study. Trevor Miles also wrote a blog about Konica Minolta’s story when they presented at Kinexions Tokyo. Feel free to check it out.

 

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


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