Where is the Toilet Paper?

April 6th, 2020

I started receiving calls after the lockdown with the key question on reporters’ minds, “Where is the Toilet Paper?”. Thus, I thought I’d share a few conversations with you. First, I was on Rip City Sports Radio about just this topic. It was a lot of fun! I love the fact that we talked about toilet paper on sports radio!

Next, I was on Supply Chain Chats on the supply chain implications of coronavirus. Of course, we talked about toilet paper as well, and we went into more detail about the supply chain impacts and potential lasting effects.

Last but not least, toilet paper is also of keen interest in written news. I was quoted by the Santa Clarita Valley Signal on “Restocking shelves amid the novel coronavirus” and I’m thrilled to be quoted in a positive article related to toilet paper by Courthouse News Service, “Texas Grocery Chain Does a Bang-Up Job Against Coronavirus“.  Did you ever think we’d have so many conversations about toilet paper?One Tip to Implement This Week:

I’m in the process of putting together a whitepaper / e-book on successfully navigating the manufacturing and supply chain impacts of coronavirus, and so stay tuned. With that said, all the conversation about toilet paper brings up the significant impact of spikes in demand on the supply chain. We have been schooled for quite some time to think about lean philosophies. If you took that literally, you would be out of toilet paper almost immediately as supply shortages arose due to the spike in demand.

Thus, my first tip is to remember common sense. Don’t take any concept literally or 100%. It doesn’t matter if it is good or bad, anything in extreme is likely to have gaps. Instead, listen to the experts and apply common sense for your situation, your team, your family etc.  As my brother said, I guess this is when his hoarding tendencies come in handy! But, of course, hoarding in general creates a new set of problems.

Stay safe and healthy. We continue to post coronavirus resources, write blog articles on navigating coronavirus as well as “beyond lockdown” strategies, and we are sponsoring APICS Inland Empire‘s “Navigating Through Volatility” webinar series. Join us and learn more here. As an executive director of SAC, we are also hosting a “Thriving Through Ambiguity” webinar series with a nominal fee for non-SAC members. Let us know if you have topics you’d like addressed. We would love your feedback.



JIT Might Not Be What it is Cracked Up to Be?!

April 2nd, 2020

Just-in-time might not be what it is cracked up to be! Certainly, the coronavirus impacts should give us reason to question this rule at face value. Are you running so tight that you only have one bin, pallet or small supermarket to keep your facility running? If so, the question extends to your end-to-end supply chain.

Let’s assume you are a critical manufacturer struggling to produce key items during this coronavirus pandemic. Your suppliers should not be on lockdown since they support a critical infrastructure business; however, that doesn’t mean you’ll be fine. There are many considerations to review:

  1. Source of supply: Are your suppliers located in Asia and unable to staff during the peak of the coronavirus? Do you know what type of delays you’ll experience? Do your suppliers have contingency plans?
  2. Your suppliers’ suppliers: Even if you have a good handle on your suppliers, do you know the status of your suppliers’ suppliers? In an interconnected supply chain, we are only as strong as our weakest link. Who is your weakest link?
  3. Your transportation infrastructure: Even if your suppliers have product, can it get to you? Within what timeframe?
  4. Backups: No matter how well you’ve planned, the question is whether you have backups for critical materials/ ingredients that will ramp up rapidly as needed. Hopefully your supply chain is diversified geographically.
  5. Your customers: Are you in lockstep with your customers so that you are proactively managing demand or are peaks and valleys a surprise? Of course, the coronavirus was unexpected but the degree you fully understand your customers will determine your reaction time to changes in demand.
  6. Positioning of inventory: Do you have critical inventory positioned throughout your end-to-end supply chain?
  7. Your digital supply chain: Are you able to see into your extended supply chain? It could provide quite a benefit at this point.
  8. Additive manufacturing & robotics: Are you able to keep running with less people, socially distanced people and/or print on demand?

Using JIT (or any concept for that matter) without taking a 360 degree view is a bad idea! The cousin of JIT is lean manufacturing. I gained the attention of Wiley by writing that lean is just uncommon common sense (which of course simplifies it in order to make a point), but perhaps it is something to think more about. Have you put all these trendy concepts through a common sense filter? How about a risk filter? Let’s hope so! Otherwise you can be in a critical business and still not producing and running customers out of stock.

What is the answer? It depends! If you have put thought into your supply chain strategy upfront, considered risks, diversified your supplier base, invested in quality checks and top talent, and treated your employees well, it is likely your version of JIT will prove successful. On the other hand, if you saw JIT as a way to reduce inventory and were short-sighted in looking at your end-to-end supply chain and treating your employees and partners as trusted colleagues, you will likely suffer.

Getting ahead of the curve might be the only avenue to success. Consider creating a resilient supply chain and future-proofing your supply chain. Stay tuned and read more about it, and If you are interested in discussing a supply chain assessment, please contact us.

Did you like this article?  Continue reading on this topic:

Future-Proofing Your Supply Chain

The Strongest Link in Your Supply Chain



SIOP for Revenue Growth & Predictability

January 16th, 2020

We have received quite a few calls lately with the underlying theme of revenue growth and predictability. And, it got us thinking: Doesn’t every executive want revenue predictability and growth? Certainly the successful ones do!

If your revenue is difficult to predict from week-to-week, month-to-month and year-to-year, it might be time to think about how to design and implement a SIOP (sales, inventory and operations planning) process that will deliver these results for your business.

Similar to lean, the SIOP methodology alone is useless. Perhaps worse than useless because it might get your hopes up. On the other hand, if you think through how to design and implement the process so that it “works” in your business and supports your bottom line results, it might put you over that stretch target of revenue growth, profitability, or working capital effectiveness. At a minimum, it will align your resources and bring clarity and predictability to the situation so that you know which levers to push or pull to drive results.

How does SIOP enable revenue predictability?

  1. Demand plan: It starts with a demand plan. Once you align all sorts of disparate inputs to your sales forecast (within your organization, with your customers and supply chain, with the market and with your data and information), you will have the best view of your demand plan feasible.
  2. Supply plan: Since you align your demand plan with your supply plans (staffing, overtime, machinery, equipment, storage, supply base), you are much better equipped to deliver the demand plan with high levels of customer service and profitability.
  3. Metrics: SIOP incorporates the monthly review of key metrics related to demand and supply, so all relevant parties remain aligned on critical data points and progress.
  4. Continuous feedback: Since there are weekly activities with a monthly cadence, as business conditions change, any relevant and noteworthy changes and nuances are naturally incorporated into the plans and visible to all relevant parties.
  5. It’s about people; not data: As the EVP of Operations at Fender Guitar says in our interview below, it is all about the people. Although clients typically worry about syncing up data sources (which has to be a part of the process), the most important part of the process is to align people. Once Sales, Marketing, Business Development, Customers, R&D/New Product Introduction, Operations, Finance, and Suppliers are aligned, suddenly all the data concerns disappear.

As executives are concerned about potential recessions, impacts of global volatility, the Skills Gap and the Amazon Effect, future-proofing their manufacturing operations and extended supply chain is on their mind. SIOP is one way to future-proof your business so that it remains predictable while minimizing risk and maximizing outcomes.

Why not consider a SIOP assessment to fully understand your potential? Following the assessment, conduct a pilot SIOP process to see the what benefits emerge.  The value will become clear. If you’d like assistance to stack the deck in your favor with this process, please contact us.

Did you like this article?  Continue reading on this topic:

SIOP / S&OP and Bottom Line Results

The Strategic Benefit of SIOP



All Roads Lead Back to People

December 30th, 2019

All roads lead back to people. In working with executives from diverse industries of aerospace, building products, healthcare and food & beverage, whether a $10 million dollar family-owned business, a $50 million dollar private-equity backed company or a multi-billion dollar global conglomerate, the most successful have the best people. Little else seems to matter. The best strategies are destroyed by poor leaders, and the most mediocre of plans are wildly successful with the right leaders.

Since many of our clients are manufacturers, and October is manufacturing month, we thought it would be the ideal time to remind you that “all roads go back to leaders”. As much as it is relevant to stay on top of the latest technologies (learn more about artificial intelligence and computer vision in our “Just for Clients Section”) and search for the best practices for your business (such as SIOP (sales, inventory, operations planning) and lean manufacturing), it is even more important to think about your people. In fact, if you have the ‘right’ people, the rest will fall into place.

When thinking about people, you should consider several important groups:

  • New hires – Spend more time ensuring you have the ‘right’ person before wasting time and energy on a non-performer! Stop thinking about job descriptions and tasks.  Instead, think about what results you need and whether the person you are interviewing can ‘turn them into a reality’.
  • Your employeesThe most important category is your employees. If your people aren’t involved and interested, how do you expect to create fans of your customers?
  • Your suppliers – Do you consider your suppliers an extension of your team? You should! They can make or break your success.
  • Your customers – Certainly, there is such a thing as choosing the ‘wrong’ customer. Are you just taking any customer that comes your way or are you making sure they are a good fit for your business? Some customers will take you to new heights and others will send you accelerating backwards.
  • Your trusted advisors – Pay attention to who you listen to! Bad advice is far worse than no advice at all. As trusted advisors, we can attest that when our clients find ‘inexpensive advice’.  They come running to us because they tied up people getting nothing accomplished, or worse, the situation has gotten worse! In addition, having the ‘right’ banking, financial and legal advice at the ‘right’ time can prove invaluable.
  • Your trade & professional organizations, alumni groups etc. – The story is very similar to trusted advisors. You can gain invaluable insight and resources if you consider your network an important aspect of your business.

Watch our interview with  Ismael Reyes, Jr. and Cindy Baughman of Ingram Micro, the Manufacturing Council of the Inland Empire’s Innovation Award winners. We talk about the relevance and importance of talent and leadership as well as the dramatic impact it can have on bottom line results. They achieved over a million dollars in savings in process improvements.  And, they consider the key to success to go back to people.

Are you interested in bottom line improvement AND/or developing a superior customer experience? If so, start with your people!

If you are interested in an assessment of how you stand vs. the industry norm and would like recommendations and priorities to drive results, read through our articles for ideas or contact us to discuss further.



Is Demand Planning/ Sales Forecasting Hype or Valuable?

September 9th, 2019

According to Gartner statistics,significant bottom line results can occur with just a 1% improvement in forecast accuracy. In fact, there are staggering improvements in lead time, inventory reduction and margins, so why not at least explore the idea? There are lots of worries expressed by clients and contacts:

  • We cannot predict what our customers will order!
  • Customers don’t even know what they will order! (And, in seeing these ordering patterns, I concur that this is often-times an accurate statement.)
  • Since we are using lean, our lean consultant told us we no longer need forecasts.
  • We are a small company and don’t have resources to focus on forecasting
  • And my favorite, “Why in the world would our significant sales team listen to you?”

I just have one question, if depending on the industry and study, a 1% improvement can lead to a 2.7% to 7% improvement in cash flow and minimally a few percentage points cost improvement in key categories such as freight, wouldn’t you be remiss if you didn’t consider your forecasting process? Of course you would be!

We have yet to run across a client that couldn’t improve the forecast, no matter how daunting the task seemed. Since the outcomes are substantial, it was worth the effort.  And, the effort was typically minimal compared to aligning the people on the forecast.

A few tricks of the trade in driving results with forecasting:

  1. Let your tool (whether Excel or a sophisticated system) do the work for you – From an 80/20 standpoint, there is no doubt that a simple tool will perform far better than even your best person. Develop your base.
  2. Focus on exceptions – On the other hand, your team is best equipped to provide insights and feedback on exceptions. Use their strengths.
  3. Drive results, not blame – Remember, the definition of a forecast is that it will be inaccurate. I’ve yet to run into a client with a perfect forecast. With that said, the three most impressive were across the board – a $100 million dollar facility of a multi-billion dollar aerospace organization with a manually generated forecast, a close to billion dollar consumer products company with a home grown system and smart people, and a rapidly growing <$10 million dollar manufacturer with an Excel-based system with smart, agile and process-oriented people. None of these folks ran around blaming anyone with forecast inaccuracy yet they all outperformed their competitors.

Perhaps it’s time to take a second look at your sales forecasting process. Who is responsible? How does it work? You never know what you’ll discover as you shine a flashlight on the process. If you’d like to discuss forecasting and demand planning further, contact us.

Did you like this article?  Continue reading on this topic:

The UGG Founder, the Amazon Effect in Healthcare and Why Demand is Key
Have you Thought about Increasing Demand??
The Strongest Link in Your Supply Chain
Please take a moment and take our survey!