Posts categorized as 'Supply chain risk management'

Are you sure you’re making the best supply chain decisions?

AlexaCheater

Successfully managing your supply chain means making decisions. A lot of them.

But the reality for many is that the tradeoffs and choices they’re making are based on outdated or inaccurate data.

How can you be sure you have the information and insight you need to make the best supply chain decisions possible for your business? Today’s planning reality leaves too much room for uncertainty. Siloed and sequential data and processes don’t deliver the visibility you need.

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To do: Prepare supply chain for natural disaster

MikeMcAllister

To do: Prepare supply chain for natural disaster“It will never happen to my supply chain,” said the first planner.

“We’ll sort it out when the time comes,” said the second planner.

Perhaps these fictional quotes resonate a familiar refrain. After all, on the list of things to do when managing your supply chain on a daily basis, ‘prepare for natural disaster’ likely sits far down the list, somewhere between ‘submit expenses’ and ‘organize file folders.’ I totally get it.

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Webinar: Supply chain strategies to combat a brave new trade world

MikeMcAllister

Webinar: Supply chain strategies to combat a brave new trade worldAldous Huxley had it right — it truly is a brave new world, and it is especially so when it comes to tariffs and trade. And for organizations with even moderately complex multinational supply chains, the mounting challenges are the most significant that they’ve faced to date. A fresh set of supply chain strategies are need, the quicker the better.

In addition to dealing with a forever multiplying list of SKUs driven by market demand, the trend toward engaging contract manufacturers continues to grow, and an ever-expanding list of commerce channels is making supply chain management more challenging by the hour. Combine this with an uncertain trade environment with unprecedented market volatility and the impact of ongoing legal, regulatory and taxation changes, and you have a perfect supply chain storm brewing.

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Good-bye siloed, functional planner. Hello storm chasing network planner.

BillDuBois

natural disasters If you had anything to do with supply chain planning in the early days of enterprise resource planning (ERP), you may consider those years the “good ol’ days”. Spreadsheets were the latest and greatest thing, your biggest headache was a supplier failure, and collaboration meant walking down the hall to visit with your buyer or dropping by the shop floor to check on a machine breakdown.

Times have changed. Supply chain planners (I’m lumping in all the silos, including demand, supply, inventory and capacity planning) today are dealing with challenges that were unimaginable when Lotus notes were the next big thing. Arguably, changes to the good ol’ days started with product proliferation, increasingly shorter product life cycles, globalization and a more educated, demanding customer.

Aligning the supply plans to these new volatile demand profiles was no easy achievement. However, none of this physically destroyed your supply chain. The increase in extreme weather events is becoming commonplace for the supply chain community and the challenge of managing around these supply chain disruptions is the new norm.

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Supply chain impact before, during, and after Hurricane Irma

BillDuBois

What are your supply chain thoughts when you see this picture?

As pictures start to emerge showing the damage caused by the recent string of hurricanes like Harvey and Irma, immediate thoughts go to the safety of the people caught in the path of these storms. Thoughts and hopefully many donations are going to all those involved in disaster recovery efforts.

The image below is an aerial photo taken and released by the Dutch Department of Defense showing the damage of hurricane Irma wrought on a shipping yard in the Dutch Caribbean island of St. Maarten.

Hurrican Irma - Supply chain impact

If you happen to be involved in any way in supply chain, whether it’s supply chain planning, manufacturing or distribution, your next thought after hoping people are okay is likely, “holy crap!”. Once the initial shock has worn off, your supply chain instincts will kick in as you assess the damage from a supply chain perspective.

You’re probably asking the question, “What’s the impact on supply?”. As you look at this picture, it’s natural to think about the amount and value of supply that is damaged or stuck on route. That immediately leads to worrying about the impact on the customer:

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Supply chain risks: The knowable unknowns that can hurt your supply chain performance!

Dr. MadhavDurbha

Supply chain riskCSX, one of the only two railroad operators in the USA that handles nearly all the shipments that move by train east of the Mississippi River has been experiencing serious challenges since the month of May. The reasons behind this were well chronicled in a recent Wall Street Journal article. To sum it up, an activist investor caused a major shakeup in the company earlier this year and a new CEO took over in March. The new CEO embarked on several cost reduction initiatives in conjunction with a number of changes (some may argue too fast and too soon) on how the company operates its freight-trains. This has resulted in significant delays and disruptions in shipment deliveries. An extreme example of this is a ride from Chicago to Colesburg, Tennessee taking 18 days, 13 hours, and 57 minutes!

The effects of these delays are being felt by many companies including McDonalds, Kellogg, Kraft-Heinz, and PepsiCo, as the article cites. These companies had to haul expedited shipments by truck so they could keep their production lines running and, in turn, meet the commitments to their customers. This has led to increased costs, not to mention all the inventory stuck in-transit.

Needless to say, such major challenges are visible enough and have significant enough disruptive power that considerable energy gets spent on addressing them, including executive engagement. However, did you know there are enough lead time problems lurking in your current supply chain operations that go completely unnoticed? These are the “knowable unknowns” that can hurt your supply chain performance.

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Plant-location decisions and potential supply chain risk

MelissaClow

Automotive PlantThis guest post comes to us from Jim Fulcher, Blogger on the Supply Chain Expert Community.

Last week, Toyota and Mazda signed an agreement to enter a business and capital alliance to further strength their partnership. The outcome is expected to either significantly impact an existing automotive supplier network or prompt manufacturers and suppliers to move or begin operations.

Specifically, the companies agreed to establish a joint-venture plant which produces vehicles in the U.S., jointly develop technologies for electric vehicles, jointly develop connected-car technology, collaborate on advanced safety technologies, and expand complementary products. As might be expected, it’s news of the joint-venture plant that is attracting attention, especially since the companies announced the plant would have an estimated annual production capacity of approximately 300,000 units, will require a total investment of approximately 1.6 billion U.S. dollars, and will create up to 4,000 jobs.

At the new plant, Mazda expects to produce cross-over models which Mazda will introduce to the North American market, and Toyota plans to produce the Corolla for the North American market. By producing vehicles in the U.S., Mazda aims to build a production structure to further grow in North America, allowing the company to more quickly respond to its customers’ needs depending on the region and model. By further increasing its production capacity in the U.S., Toyota will be better positioned to respond to the growing North American market.

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Supply chain risk management in 2017

BillDuBois

Financial crisis. Check. Environmental catastrophes. Check. What’s next? Is this the year of political disruption?

Supply chain risk managementWorking in supply chain is like starring in a Rocky movie. You keep getting knocked down and you have to keep getting back up.

You don’t need to go back any further than a decade to understand the many challenges supply chains have endured over the years. Interestingly enough, the first episode of Breaking Bad that aired in 2008 reflected what it was like being in supply chain risk management at the time: “Hey, a science teacher is cooking meth, how much worse could it get?”

If you were a fan of the series, you were on the edge of your seat amazed at the plot’s crazy twists and turns. My guess is people who didn’t see the show were the supply chain practitioners too busy trying to ride the storm of the 2008 financial crash.

Supply chains had to deal with squeezing margins and dramatically cut costs, which included significant downsizing. Doing more with less wasn’t an option; it was a necessity. Maybe the one good thing to come out of it was some companies figured out how they could survive with lower inventories. Some suppliers weren’t so lucky. In 2009, I’m sure most we’re thinking, “How much worse could it get?”

Well, it got a lot worse.

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