Here is a provocative comment: distribution operations in the U.S. will morph into two extremes when it comes to automation. One group will invest in highly automated systems to get rid of the costs and headaches of DC labor; another group will, in large measure, eschew automation altogether, and use more manual systems for their flexibility and in some cases better results. The mid-level approaches – moderate levels of automation – will see their “market share” decline.
September 30, 2007
The Global Supply Chain Leaders Group (GSCLG) is Calling for Nominations for the 2007 Chief Supply Chain Officer Award
The Global Supply Chain Leaders Group (GSCLG) serves leaders of supply chain management in business, government, and other organizations, on a worldwide basis. The mission of the Group is to respond to the unique needs of leaders who are increasingly responsible for the profitable growth and health of their respective organizations.
Sri Lanka’s Hayleys conglomerate Thursday announced a new brand for its supply chain management business saying it wanted to expand in the Asia-Pacific market and had opened new offices in India and the USA.
The group’s cargo logistics services will now be sold under the ‘Civaro’ brand which will bring together companies in the logistics cluster of subsidiary Hayleys Advantis, the holding company for the group’s transportation business, a company statement said.
Wachovia Bank, N.A., today announced the launch of TradeXchange, a secure, Web-based messaging platform designed to provide greater visibility throughout the financial supply chain from purchase order delivery through invoice settlement.
“As one of the first banks in the world to initiate letters of credit over the Internet, we continue to focus on innovation and technology — particularly relating to the evolution of the financial supply chain,” said Steven Nichols, managing director and head of Global Trade Services in Wachovia’s Global Financial Institutions and Trade Services division. “Buyers, sellers and their banks must navigate an increasingly complex international trade environment, including new challenges created by the movement to open account transactions. TradeXchange will facilitate this process by providing critical supply chain tools in a fully collaborative and real-time environment.”
Supply Chain Digest’s Dan Gilmore recently spoke with Gaurang Pandya of i2 on several themes related to S&OP.
Gilmore: It is often said that “most companies do S&OP, but few do it well.” Is that an accurate summation of current conditions?
Pandya: I think so. The definition and understanding of the S&OP process varies across almost all companies. For some, it is merely a sales forecasting process, for others it is a more tactical process of making sure that demand is met. More often than not, neither considers the implications the tactical decisions will have on the overall business targets. There are varying levels of maturity and very few companies would qualify for what we see as the top 2 levels, which are “consumer driven-demand synchronization” and “consistent profitability.”
Solely focusing on traditional approaches to cash management can limit a treasurer’s ability to manage working capital in a holistic way. One of the keys to effectively managing working capital is to apply a strategic approach to all operational areas of a business . In other words, treasurers can better manage working capital by looking into functions beyond finance.
The supply chain is one place that treasurers can look to gain more visibility into operational working capital. Understanding a company’s supply chain processes and how decisions within the supply chain are made can give treasurers the information they need to profoundly affect working capital.
In the never ending debate about ERP versus best-of-breed solutions, and the value of enterprise software generally, a recent article in MIT’s Sloan Management Review casts more doubt about the idea of a single enterprise system to manage the supply chain.
The problem is complexity. The greater the scope of a single dominant system, the greater the complexity of stitching the entire system together across multiple processes.
Lego is one of the most iconic brands not only in the toy category, but in consumer products generally. So much so that its connectable construction blocks were named “toy of the 20th century” by Fortune magazine.
But that didn’t guarantee financial success. In fact, in a very interesting case study in the Strategy + Business magazine from consulting company Booz Allen, it turns out supply chain complexity and dated processes almost killed the company earlier this decade – and that a subsequent supply chain transformation helped turn the company and the bottom line around.
Several dozen supply chain practitioners, from across the globe have developed definitions for a number of supply chain metrics based on real-world experience. The project was sponsored by APQC, an internationally recognized resource for process and performance improvement that will now enable supply chain executives to improve manufacturing and logistical processes and performance within their organizations.
Dr. Ed Marien is currently president of Marien & Associates in Lodi, WI, and emeritus professor at the University of Wisconsin and director of its Supply Chain Logistics Management program. He has done a substantial amount of research and writing on a variety of purchasing and strategic sourcing strategies. He discussed his insight and perspective on the concept of “Supplier-Price-Cost Management” in this interview with Supply Chain Digest. Part 1 is available at: Understanding Supplier Price-Cost Management in Sourcing
Supply Chain Digest: How do the concepts we talked about last time – such as understanding the difference between purchase price and actual cost, relate to strategic sourcing programs?
Marien: What you begin to do is to look at procurement decisions through a couple of specific filters.