Tag Archive: business

What do UPS, Shamrock Foods, Amazon & a 3PL Have in Common?

March 14th, 2019

In touring multiple facilities, ranging from package shipments to cold storage food service delivery to the e-commerce behemoth to 3PL organizations, it despite the conversations that take place about labor costs and other daily concerns, the #1 concern across the board is transportation costs. The numbers support this sentiment. According to CSCMP, transportation costs are 65% of total logistics spend.

Logically, it also makes good sense. No matter your business, materials, parts sub-assemblies and/or products need to arrive at your facility. Often, especially in industries such as aerospace, the parts make multiple trips around the area (unless you are unlucky enough to require sourcing outside of your local area) for outside processing services such as anodizing and painting. Lastly, every work-in-process part or finished good must go to the next stop along the way to the customer such as a final assembly customer, your distribution center, your customer’s distribution center or the end customer. That makes for quite a lot of transportation, often involving multiple modes of transport from air freight to ocean freight to rail to trucking.

Given these alarming statistics about transportation costs, the question becomes: What can we do to proactively manage these costs as well as reduce the impact on the environment? After listening to several experts on these tours and experts from Georgia Tech, APICS (learn more about the critical importance of logistics in our APICS-IE CLTD, certified in logistics, transportation and distribution certificate program) and CSCMP SoCal (at the state of the industry event), a few ideas emerged.

  1. Collaborate with strange bedfellows:As recently published in an I’ve Been Thinking article, collaborating with strange bedfellows can achieve 1+1+1 = 25 minimally. In terms of transportation, there is no doubt maximizing the space used in your truck, container or plane is vital. Why not collaborate with another business to increase your utilization?
  2. Take the holistic or systems view: It is quite challenging to see the forest for the trees as the old slogan goes. We have all been there! I have worked with clients for extended periods of time and found myself with this same issue.  So, I have to deliberately shake it up to maintain the systems or bird’s-eye view. For example, don’t worry about saving a few pennies on a non-essential element of your transportation infrastructure when you are missing the key point that your mix of modes of operation or something like that is costing you millions.
  1. Utilize technology that focuses on the critical transportation factors: In every case (at every tour, event and in every conversation), leveraging technology where it makes sense came up. Certainly, artificial intelligence is the new craze since it has the potential to transform entire industries including logistics. However, robotics are being considered even in industries such as 3PL where they never were previously due to the nature of managing different customers and products. Of course, IoT is prevalent in the world of logistics and transportation as well as topics such as alternative fuels and automation. And what about the basics of a solid ERP system and TMS (transportation management system)? Don’t panic over the horror stories. Contact us if you want to overcome them.
  1. Be customer friendly:Interesting how often being customer friendly arises, no matter the industry or size company (small family owned to private equity backed to large complex organizations).  With rising truck rates and a shortage of drivers, if you aren’t a preferred shipper, you might just be out of luck no matter how much you spend. What does it take to be a preferred shipper? It depends on your business, carriers, locations and more. However, it starts by thinking about what is important to your carrier (not you). Are they looking for flexibility? A quick turnaround time? Fast payment? Good treatment for their drivers?

Since transportation costs are, at minimum, 65% of your total logistics spend, it requires further thought. With the vast amount of technology options available, the best approach is to start with your foundation (your ERP system) and ensure it is stable. Once you have a scalable base, find the ‘right’ technology for your situation to maximize the value of your logistics infrastructure. However, remember the 80/20 goes back to people. What are you doing to develop strategic partnerships and to ensure you are customer friendly and a preferred shipper? Given the impact, don’t leave this to chance or make assumptions. We all like to think we are preferred but what can we do to take it an extra step further?

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

Systems Pragmatist

 The Sheer Relevance & Impact of Transportation (a Billion Here, a Billion There)The Resilient Supply Chain: Should We Invest in Technology?

 



The Stock Market, The Economy & How They Do Not Align

February 12th, 2019

Key research groups are starting to talk about their predictions for the economy, and everyone is interested. It feels like everyone is waiting for the other shoe to drop. After all, we have been in an expansion mode far longer than is typical and there is plenty of volatility and uncertainty in global trade, the U.S. Shutdown and more. Last week, I heard a research expert from City National Bank and did an informal poll of trusted advisors (CPAs, attorneys, consultants, commercial bankers etc.). The bottom line = continued growth.

The City National Bank expert said that they study about 20 economic indicators, and all are firing on all cylinders. The only one that has consistently shown some potential for hesitation is geopolitical risk –  which isn’t new. As much as the U.S. Shutdown, global trade tensions, Brexit and more has the stock market jittery, it hasn’t impacted the economic forecast. Businesses are growing and the economy is doing well! The hot topics being discussed include asset protection, the talent shortfall, the technology transformation and cyber security risks. There are always lots of details to consider but the common theme is growth. Thus, a key question becomes, are you prepared for scalable, profitable growth?  

One tip to implement this week:

What I’m seeing as a differentiator to success in these strong yet uncertain times is the ability to ‘stay the course’ and be resilient.  With each new emerging news story, I’m seeing the stock market choke and people panic. Unfortunately, this can lead to short-term, erratic changes in executives’ decisions. No one wants to be put into the same position as they were in during the last recession. So, the tendency is to overreact. Yet, the most successful clients provide stability and a platform for scalable growth.

They are willing to make hard decisions, ranging from investing in top talent to systems and technologies (even when their peers are hesitant) to addressing the sacred cow (every business has at least one!) to thinking about how their business model might be evolving and what they might need to change (even when they are currently profitable and seemingly successful).

It might make good sense to take a step back and avoid overreacting to the latest news. Stay aware and on top of trends. Ask questions and consider down-the-line impacts on your business. Instead of getting caught up in the latest drama or fad, put thought into how to build agility into your plans. How can you ensure your navigation system is rock solid and will weather whatever storm occurs next. If there is one constant, it will be continued volatility and uncertainty.

Prepare to be resilient. Check out our new resilient supply chain series and contact us if you’d like to have an assessment of your organization.



What’s Ahead in Technology?

January 30th, 2019

To think about what’s ahead in technology, it is important to put it in perspective with what’s ahead in business.  Read our article, “What’s Ahead in Business?” for details on the key trends impacting business:

  1. Importance of the customer experience
  2. Taking the holistic view has become a “must”
  3. Volatility is the new norm
  4. The coming power of manufacturing and supply chain

What’s ahead in technology lines up with these same themes. In order to achieve scalable, profitable growth, technology is an important enabler. The most relevant technology trends include:

  1. ERP Upgrades – More and more companies are realizing that their system infrastructure must keep up with business requirements and customer expectations. As tough as an ERP upgrade can be, it is one of the only ways to make the leap from manual, labor-intensive processes to providing a superior customer experience efficiently.
  2. E-commerce/ Customer Portals – Amazon. Alibaba. Customer collaboration. Need we say more?
  3. Business Intelligence & Data Analytics – We are overwhelmed by mountains of data. We are so anxious to gather data yet we don’t seem to have the appropriate information at our fingertips when we need it. That’s where data analytics comes into the picture. Beyond that, predictive analytics is gaining steam.
  4. Artificial Intelligence – Even my Mom counts on Alexa! In addition, who wouldn’t want a car that self corrects? Predicting customer patterns and behaviors is becoming more important. AI is set to transform many industries over the next several years.
  5. IoT– Smart factories. Smart homes. Connected devices and machines. According to NEWGENAPPS, 60% of global manufacturers will use analytics data tracked using connected devices to analyze and and optimize processes.
  6. Robotics & Automation – Robots may not be taking over the universe tomorrow morning, but they are working hand-in-hand with people to achieve many benefits – improve safety, increase speed and consistency, improve customer satisfaction, fill capacity shortfalls and and increase productivity.
  7. Autonomous Vehicles – Beyond self-driving cars and trucks, autonomous vehicles are used widely in manufacturing and distribution environments.

Are you thinking about which of these technologies will support your business objectives?  Or which are likely to impact your industry?  Consider technology as a key part of your strategy and plans. If you’d like an expert to evaluate which, if any, of these technologies will be relevant to your business, contact us.

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

Systems Pragmatist

The Resilient Supply Chain: Should We Invest in Technology? 

AI, Robots, IoT, Blockchain, Hike!



What’s Ahead for Business?

January 26th, 2019

Thinking about our clients, colleagues and trade association/ trusted partner contacts from across multiple industries and company sizes, four overarching themes emerge in response to the question, “What’s ahead for business?”.

 

 

  1. The Customer Experience: It doesn’t matter whether we are talking about manufacturing, logistics, healthcare or services, the customer experience is of paramount importance. This is quite different from customer service! The customer experience relates to how the customer feels after interactions with you and your firm. Whether you achieved perfect OTIF (on-time-in-full) or not, if the customer doesn’t want to do business with you, you haven’t achieved a superior customer experience. What will you do to up the ante?
  2. The Holistic View: Although this is a common thread in our client conversations, it isn’t commonplace. Having a Holistic View has become a “must” as the global marketplace is more interconnected than ever before; systems and technology are more connected with everyday interactions; and, the customer and profit go hand-in-hand. Clients who address a singular topic such as running a kaizen instead of looking at the holistic view of what will dramatically improve their business performance will be left in the dust. Are you looking at what your executives or board are asking about or are you taking a step back to look at your business from the holistic view?
  3. Volatility is the New Norm: The stock markets and business performance are becoming less and less related to one another.  Yet, both are volatile. There is uncertainty in global trade, government shutdowns, the impact of artificial intelligence and robots, natural disasters like the California fires, what the disruptors such as Netflix and Uber will do next and much more. Are you thinking about how to create a resilient end-to-end supply chain?
  4. The Coming Power of Manufacturing and Supply Chain:No matter your industry, you better pay attention! For example, according to a Healthcare Finance article, by 2020, supply chain expenses will eclipse labor as the new number one cost in healthcare. Also, according to a Chairman at the City of Hope, the cure for several types of cancer is within reach but will be cost prohibitive unless manufacturers figure out how to produce in volume and less expensively. Certainly, Amazon is turning the world upside down, creating an entirely new relevance to the art of maximizing service, inventory and margins simultaneously. Re-shoring is on the rise, additive manufacturing is uniquely positioned to transform industries (customized, immediate products on demand) and bringing the customer closer to the source is a recipe for success. Do you still see manufacturing as outsourced to China or as a force?

Our most successful clients will be thinking about these trends to integrate into their strategy, their customer conversations and their employee and partner plans. Are you positioned to take advantage of the opportunities and avoid the risks? If you would like an expert to assess your situation, contact us.

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

Do You Have an Eye to the Future?

Disruption, Innovation, Global Trends & the APICS-IE Symposium 

 



What’s Ahead for People?

January 23rd, 2019

People make a business thrive. That’s why even the most technical of companies like Google value people.  In our experience, people are the #1 asset of any organization. Hands down, we can help any organization with good people quicker and to a FAR larger degree than an organization with very few good people.

In thinking about what’s ahead for people, there are many transitions and trends to be aware of:

 

  1. Baby Boomers  – As baby boomers retire, they will be harder to replace than what appears at first glance. Typically speaking, they aren’t up-to-speed on the latest technology.  They might have old fashioned ideas but they know “what works”. Don’t be too quick to hurry the process along. Instead, value their knowledge and find a way to transition it for a win-win.
  2. The Skills Gap – It is hard not to have a skills gap when technologies change daily. Jobs are being automated and new jobs are being created with entirely new skill requirements. The world is becoming more complex and global and customers expect more for less. Are you prioritizing the retention of your top talent? Is your company attractive to top talent?
  3. Diversity– We are not believers in mandates and regulations but we have found diversity to propel success. Are you actively attracting people who do NOT think like you? That’s a tough one (after all, don’t we all prefer people who agree with us?), but it is important if you want your team and organization to thrive.
  4. Spark an Innovative Culture – With the high demands of customers, bard members and the like, solid leadership is no longer enough. Sparking innovation has become a “must” for success.
  5. Back to the Leadership Basics – There is no coincidence that every successful client has a strong leader. Whereas long-term struggling clients and contacts (as struggling leaders rarely hire consultants) have weak leaders. Being a strong leader is “hard work” and requires courage. What are you doing to build your leadership bench strength?

The core tenets of successful people do not change. The requirements and challenges we face continue to expand. Yet, the route to success is clear. We choose to see this fact with hope as it does not require rocket science to become a good leader.  We’ve seen plenty of examples of mediocre leaders who transform into exceptional leaders through mentoring, coaching and experience.

Did you like this article? Continue reading on this topic: Profit Through People 

Global Consultants and the Value of Diversity 

Do You See Your People as Assets or Expenses?