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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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ERP Selection: Why It Has Become a Strategic Priority

April 18th, 2019

In today’s Amazonian environment, customers expect rapid delivery, over and beyond from cradle to grave, collaborative service, 24/7 accessibility and last-minute changes. Executives are realizing they must upgrade their technology infrastructure to meet and exceed these customer expectations while driving bottom line improvement.

Your ERP decision will be one of the most significant investments your company will undertake, and these projects are wrought with risk. 80% fail to achieve the expected results yet waiting “too long” can put you out of business.

Selecting an ERP System is a Strategic Priority
Because of the significant customer and bottom-line benefit and steep, unintended consequences associated with these projects, the most successful clients realize they must be a strategic priority. By no means should the decision by relegated to a technical expert or project manager. Involve your best and brightest on the team and ensure your executive team is on top of preparation, progress and the inevitable pitfalls – beginning with preparation:

  • Understand business processes: Start by understanding what occurs on a day-to-day basis. One of the top failure points is to assume that people can make the leap from current processes to what every ERP provider claims to be “best practices” on day 1 with no roadmap.
  • Gain strategic and cross-functional input – Since all systems will perform the basics well, success will boil down to what drives your strategy and supports your cross-functional and cross-organization collaboration.
  • Identify critical requirements – Countless hours wasted on typical business requirements (which all systems generally cover); instead, focus 80% of your attention on the requirements unique to your business, industry, and company. Think customer differentiation & profit drivers.
  • Prepare data and be realistic evaluating your process disciplines – No matter how well you prepare, your system will only be as good as your data and process disciplines.
  •  Dedicate appropriate resources – Be an exception. Supplement your resources, bring on appropriate expertise early on and be willing to invest in what will ensure success and mitigate your risk.

5 Critical Factors in Selecting ERP Software

As complicated as most companies seem to make it, the critical factors in software selection boil down to a select few:

  1. Your business objectives – Don’t worry about everything required in every module to run your business. Instead, take a step back and focus on what you need to meet your grow and profit plans.
  2. Cloud or not?  It depends. Dig into the details. Develop your own spreadsheets with paybacks. Consider your technical resources, adeptness with topics like cyber security and the latest technology, and your ability to navigate disruption and risk.
  3. Understand your culture – What are your cultural norms when it comes to change? Do your employees have an entrepreneurial spirit or do they require strict procedures? These answers will be integral to aligning culture and technology.
  4. Think about design upfront – Not thinking through down-the-line implications will derail the best of projects. Incorporate design and a holistic systems-view upfront.
  5. Ballpark estimates and ranges – Get a ballpark upfront, and never accept the first estimate. It’s typically too low! Worse yet, two suppliers that should be within 10% of one another can be 100% different. Ensure you are comparing apples to apples, and remember implementation, not software, is the 80-pound gorilla of ERP success.

ERP is a tough topic! Clients worry they are “too small” or it will be “too expensive”, and in the interim, the competition passes them by since having the technology that supports a superior customer experience without breaking the bank is a “must”, no matter your size or industry. With that said, we have seen clients ready to “throw out” a perfectly suitable ERP system as they think it is the system, not the process or people that is the issue when it isn’t.

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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The Talent Transformation: People or Robots?

April 14th, 2019

automationNo matter the industry and geography, the topic of “People vs. Robots” is a hot topic!

Certainly, manufacturing has been focused on technology and automation for quite some time to navigate the path to thrive in the modern environment of high costs, regulations, and elevated customer demands.

The Manufacturing and Technology Expo in Pittsburgh is going back to the theme of the 1939 World’s Fair, “The World of Tomorrow”. The Manufacturing sector has seen positive job growth not seen in 79 years. As Industry Week says, “We don’t have smoking robots but we have ones that perform lung surgery.”

Our APICS Inland Empire Chapter is hosting an executive panel and networking symposium on just this topic, “The Talent Transformation: People or Robots?” on April 13th at Harvey Mudd. We have an intriguing panel of executives and experts to discuss automation, robots, IoT, AI and much more. How do we co-exist successfully? Join us to learn more and probe further.

In logistics circles, there is quite a bit of worry and opportunity. According to a University of Redlands study, most large metropolitan areas are subject to losing 55% of their current jobs due to automation. In Inland Southern CA, that number expands to 62%. However, it depends on your thought process. UPS automated a section of their facility that reduced the number of people they needed by 100 yet they ended up hiring as they absorbed additional volume. Additionally, it depends on whether you are furthering your education and skills. We find proactive employees and employers in our Association for Supply Chain Management (ASCM)’s APICS certification classes who want to learn and grow.

For Inland Southern California, we have a particularly unique opportunity or challenge, depending on how you want to look at it. According to a Brookings study, we must focus on advancing the capabilities and competitiveness of local firms in opportunity-rich manufacturing and logistics industries. What an opportunity for us to leverage technology hand-in-hand with talent to THRIVE.

If you are interested in discussing whether your organization is prepared to leverage these opportunities and what priorities should emerge, contact us. We are experts and would love to see the U.S., California and the Inland Empire take advantage of this tremendous opportunity to enable scalable, profitable growth.

Find out how to navigate disruption and achieve peak performance.

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The Talent Transformation: People or Robots?

April 10th, 2019

The hot topic in manufacturing, supply chain, healthcare and other industries is the war on talent. No client believes he has enough “high-skilled” resources yet most also feel challenged in finding resources regardless of skill level.

On the other hand, there are statistics and studies showing that there is a talent transformation underway. According to a university of Redlands study, Most large metropolitan areas are subject to losing 55% of their current jobs due to automation. In Inland Southern CA, that number expands to 62%. Thus, what are we doing to get ahead of these trends?

I am the president of the Association for Supply Chain Management (ASCM)’s APICS Inland Empire chapter, and we are hosting an executive panel and networking symposium on this hot topic. We have a powerful lineup of panelists to discuss and debate the talent transformation and the impact of technology and automation.

  • Paul Granillo – CEO of the Inland Empire Economic Partnership (IEEP)
  • Cindy Elliott – Global Go-to-Market Strategy Manufacturing and Supply Chain, ESRI
  • Jerry Hsiung – Robotics expert, Carnegie Mellon & Harvey Mudd
  • Jermaine Waltemeyer – Recruiter/ Practice Lead, Aerotek

Lastly, we will be adding a manufacturing/ supply chain executive to the panel as well. Seats are going quickly. Learn more and register here.

One tip to implement this week: 

Certainly, if you are interested in getting ahead of the curve in manufacturing, supply chain, healthcare and more in terms of technology and talent, join us at our symposium. It is bound to give you a few ideas!

In addition, join us at APICS-IE for our webinars, tours and programs as we will be talking about this topic and seeing it in action. For example, we will be scheduling a webinar on the digital transformation as well as tours of facilities at various stages of automation. There are also other groups that focus on these topics. For example, the Manufacturing Council of the Inland Empire (MCIE) has its annual summit in February, and the IEEP hosts the Supply Chain Summit which will be on April 26th.

Additionally, of course, there are tons of on-line resources such as the National Association of Manufacturers. And, one key to success is to expand your network so that you have resources and connections that can support your growth and advancement. Think about connecting with a colleague and start a conversation.

 



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.