Category: The Strongest Link in Supply Chain

2019 Predictions from Manufacturing & Logistics Executives

April 22nd, 2019

Economic volatility and uncertainty are the new normal. Instead of lamenting, manufacturers have a unique opportunity. There has never been a better time to stand out from the crowd with a superior customer experience amidst the chaos. 

Not only has the Amazon Effect driven customers to expect customized product and service offerings with rapid response – creating a greater demand for local manufacturing – it has also made innovation a cultural norm. There is a trend towards near-sourcing, vertical integration and agile strategies to proactively address these elevated expectations as well as to meet customers’ insatiable need for last minute changes.

With the rise of e-commerce, increasing transportation costs and global risks, sourcing experts are re-evaluating their global supply chains. Logistics is gaining in relevancy as transportation costs increase, sustainability efforts expand and managing inventory becomes a hot topic as accelerating cash flow becomes more relevant.

Drones, robotics, IOT, artificial Intelligence, big data predictive analytics and additive manufacturing are transforming entire industries while providing the tools to create a customer-centric, resilient supply chain. However, technology alone will achieve nothing. With a differentiated strategy and the right talent, the opportunities are endless. 

We asked business owners and executives for their predictions for 2019. From aerospace and defense to food and beverage to building products, the perspectives may be different, but the outcome is the same: Opportunity Abounds. 

Find out how to navigate disruption and achieve peak performance. Download our free report here.

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Amazon Disrupts Again

April 5th, 2019

According to Bloomberg, Amazon disrupts again. They have abruptly stopped selling products from their wholesalers and are instead encouraging suppliers to sell on their marketplace, transferring the purchasing, storing and shipping of products to the supplier. The marketplace business is already estimated at $250 billion in value which is more than double the online retail business. They also pulled volume from some suppliers less than $10 million annually. If you are in either of these positions, this could be a substantial disruption especially with no notice!

According to the Journal of Commerce, Amazon is also disrupting container shipping with its increased use of its ocean forwarding arm. For example, with its non-vessel-operating common carrier (NVO), Amazon is gaining greater control over its internal supply chain but the key is whether it is thinking about building a supply chain platform.

Amazon isn’t the only disruptor. Are you proactively thinking about navigating disruption?

What Should We Consider and/or What Impacts Could Arise?
Hardly a day goes by without some sort of disruption, natural disaster or other event such as the Boeing 737 Max concerns. There is no way you can be prepared for every potential issue that will arise. With that said, it is remiss not to consider the most likely and relevant risks. Do you have a process to incorporate these into your strategy and execution plans on a frequent basis? Gone are the days of the 5 year strategy, updated once a year. Business is moving at a much quicker speed!

In addition, start looking at how to build an agile and resilient end-to-end supply chain. Start internally. Are your people prepared for the daily, weekly and monthly changes most likely to impact your business? Do they have backup plans? Or will it take a lengthy approval process to get a critical decision made to navigate disruption? Don’t just assume you are covered. Go and find out. If you’d like some tips for managing disruption, take a look at our resilient supply chain series.

 



2019 Predictions Report: What to Expect and Where to Focus

March 26th, 2019

I’m thrilled to launch our 2019 Predictions Report, “Manufacturing & Supply Chain in the New Normal: 2019 Predictions from Manufacturing & Logistics Executives” discussing what to expect and where to focus.

We assembled this based on these types of questions:

  • How do we increase profitability in today’s new normal environment?
  • Do we see growth or recession? Or something in the middle? What should we do?
  • There are so many technology options with the promise to transform entire industries. Should we be pursuing? Which ones?
  • Customers expect quick delivery with changes along the way (even while intransit), excellent on-time-delivery (OTD) results and more. Where should we focus?
  • Trade wars and global sourcing – what to do?!
  • How is it trending in our industry? Are there any hot buttons, like talent?

Discussions with several manufacturing and logistics executives and experts are included in the report. Feel free to pass on this link to colleagues and friends to get a free copy of the report.

With that said, since you are already on our newsletter list, here is a direct link just for our newsletter subscribers.

Thank you to our clients and colleagues who participated with their predictions and advice! Please share your feedback. We would love to gain your insights, concerns etc. We’ll incorporate into our upcoming interview and article series.



Trump Signs Order Prioritizing AI Research

March 18th, 2019

According to the White House, President Trump signed an executive order directing the U.S. Government to prioritize artificial intelligence in its research and development spending. The focus is on ensuring that AI develops in sync with U.S. values and that training for the future workforce is prioritized. This is a culmination of meetings with Google, IBM and Microsoft and reflects the  commitment to focus on leading edge technologies. From an industry point-of-view, this focus is applauded.

The talk is that AI will transform entire industries. There is no doubt that without a focus on advanced technologies and the associated training and workforce efforts, you will be left in the dust, similar to looking for a payphone along the side of the road. Whether in a meeting with CEOs or the consortium for supply chain and advanced manufacturing excellence or at a client focused on increasing demand, AI is a part of the discussion.

I just so happen to be attending a Microsoft Dynamics Day to stay up-to-speed on the latest technologies.  AI has already arisen as a key topic and focus area. Microsoft is building AI into their tools. Here is a press release explaining AI in the recent release of the software. Of course, Microsoft is just an example as every leading edge technology player has at least some level of focus on AI.

What Should We Consider and/or What Impacts Could Arise?
There is no doubt about it. AI will impact every industry in some way, whether directly, through suppliers or customers or in terms of service and cost expectations. I never recommend jumping on a bandwagon blindly. After all, how many companies outsourced when it was “the craze” and now regret that decision because it didn’t make sense when looking at the full picture? Plenty! On the other hand, you must be informed and consider the options and implications for your business.

There are many opportunities to learn about AI and its potential impacts so that you can integrate in your strategy. For example, our APICS Inland Empire chapter‘s upcoming Executive Panel and Networking Symposium will be on the topic, “Manufacturing & Supply Chain Talent Transformation: People or Robots?“. Join us for this education and networking opportunity. However, this is just one option. Ask your CEO group. I see this as a valuable benefit from collaborating with peers! Contact me if you’d like a referral. Attend a trade or industry conference. Read industry magazines and the Wall Street Journal. Pay attention to the news related to your industry, your suppliers, your transportation partners and your customers. Talk with an expert and/or ask your expert to assess your situation and provide recommendations.

In our view, keeping key technologies such as AI top of mind is part of creating a resilient supply chain. Without a doubt, those with a resilient supply chain are far more likely to succeed in these changing times. To learn more about how to create a resilient supply chain to navigate disruption and achieve peak performance, check out our new series or contact us for customized expertise.

 

 

 



Have You Thought about Increasing Demand?

March 8th, 2019

If you are reading our newsletter, I have no doubt you are interested in increasing demand. Whether an owner, executive or key player, increasing demand for your products and services has to be top of mind. Let’s put it this way. No matter the position of my client (typically a CEO, Owner, CFO, General Manager or Board member), he/she is interested in increasing demand.  Consequently, the projects we work on are typically related to increasing demand, either directly or indirectly.

I was on a panel about increasing demand at the Anti-seminar Executive Luncheon. We had interesting discussions about demand from several diverse points-of-view. Thanks to Chase Photography, you can see them as a livestream on Facebook – video 1 and video 2 (about 60 minutes total). In thinking about how to increase demand, a few highlights include:

  1. Observe how your customer uses products and services –An often-overlooked gem is to follow Apple’s lead and observe how your customers are using your products and services and look for ways to enhance their experience. Have you taken a step back lately to look for areas where you can further help your customer?  Do you make working with your company onerous? That’s an obvious one yet commonplace. Imagine if you looked further!
  1. Do you provide a superior customer experience? If you ‘shopped’ your business, would you want to buy from it? Do your customers receive their products and services as ordered and in good quality/ condition? On-time? Quicker than the competition? Do you allow for easy returns? Hopefully you answered yes to each of these. We’ve found that this solely achieves a base level of customer service. Thus, the question becomes, “What are you doing to go over and beyond to make your customer compelled to return to you?”.
  1. Are you referable? First, people buy from people; not companies. Are you people referable? The #1 strategy to increase demand is referrals. No matter whether we are talking about a manufacturer, distributor, transportation partner or service organization, referrals can generate more business than any other method. Just as much as we enjoy buying the latest technology based on the referrals from our friends, the people working at companies also refer. When is the last time you attended an industry event or conferred with local CEOs? You better believe business gets done based on word of mouth.
  1. What can you take over for your customer? We have found that whether the industry is aerospace and defense, food and beverage, building products or healthcare products, there are opportunities to take over tasks for your customer. One common and prevalent one is to figure out what your customer needs at each of their branches/facilities and keep them replenished so that they have the ‘right’ inventory at the ‘right’ place at the ‘right’ time. We see this as gaining relevance.  Distributed inventory is becoming an essential element of the end-to-end supply chain plan as customers expect Amazon-like service and will find someone else if you cannot meet their needs.

When at PaperPak, we won supplier of the year for two years in a row with our #1 healthcare products customer because we implemented vendor managed inventory and were able to maximize their service levels while minimizing their inventory levels (cash tied up throughout their system). It didn’t hurt that we also grew the business by partnering further with them while reducing our costs and inventory levels as well. Have you thought about taking a request from a customer and turning it into increased demand for you?

Our most successful clients are thinking about these types of strategies to increase and manage demand. Why not spend a few minutes to listen to the expert panel and walk away with a few insights? If you’d like an expert to assess your situation to partner with you to achieve these types of results, contact us.

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