Tag Archive: sustainability

The Global Logistics Landscape

February 15th, 2019

In the past two weeks, I attended the CSCMP State of Logistics event, am preparing for the Future of Supply Chain & Logistics reception event as part of the leadership team and have debriefed with LMA Associate, Elizabeth Warren who attended the State of the L.A. Port and the State of Long Beach Port events. To summarize, I’ll borrow from the Port of L.A.: “Busier, safer, greener”.

Still number 1 and 2 in the U.S., the ports of Los Angeles and Long Beach increased volume last year to 9.5 million TEUs (twenty-foot equivalent units) and 8.1 million TEUs respectively.  With the threat of tariffs, there was a surge of imports around the holidays, creating record-breaking days in both locations and the second busiest month in history at Long Beach.

Significant progress has been made in terms of air emissions. From 2005 to 2017, diesel particulate matter has decreased by 88%; nitrogen oxide has decreased by 56%; sulfur oxide decreased by 97%; and greenhouse gas by 18%. In terms of targets, there is a goal to reduce greenhouse gasses by 40% in 2030 and 80% in 2050. Certainly, California leads the way when it comes to green and sustainability.

Logistics is around 7.7% of GDP or $965 billion. It has increased around 20% since 2006 yet decreased as a percentage of GDP by 30%. In comparison to other countries, we are far lower with Japan the closest around 11% and China the furthest around 18%. E-commerce is increasing around 15% per year, and it carries high supply chain costs around 25-30% of e-commerce sales.

All modes of transportation were up (airfreight, rail, trucking)! With that said, trucking is 76% of transportation spend and is the 100 pound gorilla. Rates have been on the rise, capacity is tight and shippers have to be more proactive. There are lots of technologies being explored but no near-term, viable solutions to resolve the issues. Again, similar to the ports, there are countless conversations about sustainability.

What Should We Consider and/or What Impacts Could Arise?

Global logistics is relevant to GDP and to every business that produces, distributes and sells products. Whether an aerospace manufacturer with multiple outside service steps all requiring transportation or Walmart, requiring a supply chain sourced both locally and from afar as well as grocery delivery on the customer side, without logistics, business will cease.

In today’s Amazon-impacted marketplace where quick turnaround, short lead times and frequent order changes are the norm, re-thinking your manufacturing and extended supply chain footprint is becoming a necessity. Whether re-evaluating make vs. buy decisions, re-configuring sales channel structures or revising inventory fulfillment practices, logistics is one component that can no longer be an afterthought.  

In our view, those clients with a resilient supply chain will thrive in this new normal business environment.

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.



Drucker Supply Chain Forum Executives Share What They Look for in Supply Chain Professionals

April 11th, 2017

What are executives looking for in supply chain professionals? That was the topic of the panel I participated in at the Drucker Supply Chain Forum with executives from the Walt Disney Company, Source Intelligence, Intelligent Audit and CSCMP. So, what is the consensus?

1. Broad knowledge– Supply chains are global and more complex in today’s world. Thus, a broad and diverse set of skills is required to be successful in the field. If you have the opportunity to try a new area you wouldn’t have requested, give it a shot. You might just enjoy it. Worst case, you’ll have built skills that will come in handy as you move forward in the supply chain profession.

2. Technology– There is no doubt about it. Supply chain and technology skills must go hand-in-hand. If you aren’t keeping up with what’s needed to be effective in the current environment while also looking ahead, you’ll be left in the dust. Artificial intelligence is gaining momentum. Cloud computing is the norm. Collaborating across your supply chain is becoming commonplace. Are you on top of these topics?

3. Communication & presentation skills– Unfortunately, no matter how smart your solutions and ideas, none will proceed if you cannot present them effectively. And, that is just one aspect. Consider how to collaborate across your supply chain without these skills. Not feasible.

4. Risk– Your supply chain cannot be effective without thinking about the impact of risk. There are countless types of risk around us – cyber, natural disasters, financial, political etc. Have you at least considered the most impactful and likely risks?

5. Sustainability – This topic continues to gain steam and popularity. Are you thinking about how to turn sustainability into a win-win-win?   

 

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Trends: Are You Looking for What’s Coming?

March 28th, 2016

My most successful clients are constantly searching for what’s around the next corner. You cannot become complacent! Unfortunately, while you are resting on the sidelines, your competition will pass you by. Instead, be vigilant about looking for what is coming around the next corner and spotting trends.

A Supply Chain In a State of Flux

In supply chain, the world is constantly changing. Strikes occur. Storms, hurricanes, tornadoes, and the like are very hard to predict. Natural disasters strike. Political unrest is significant. Costs evolve, especially in comparison to one another. Imagine how complex things get with currency fluctuations! Countries struggle – just look at what’s been going on in China. Oil and gas prices can have a great impact. Just look at products and countries dependent on the oil industry. The products cost less to produce but the countries and companies with significant oil exports are struggling. And the list goes on…

There are also strategic changes taking place. Amazon has created quite the stir with immediate deliveries and a membership model. This has created havoc in the distribution industry as e-commerce has become a necessity which also drives completely different warehousing and fulfillment operations to maintain efficiency. The green and sustainability movement has created many new requirements as well. How about water? Talk about a hot topic in California!

APICS-IE Event to Examine Supply Chain Trends

APICS, APICS-IE, Symposium, trends, supply chain trendsWhat is next on the horizon?  To be successful, you must keep up!  Join APICS Inland Empire for our executive panel and networking symposium on “Emerging Supply Chain Trends” at Eagle Glen golf club in Corona on April 30th.  We welcome members and non-members alike.  You’ll walk away with new ideas from top executives and supply chain gurus.  RSVP before it sells out.

 



Sustainability – Who Knew That It’s Common Sense?

May 27th, 2014
business sustainability

Liken sustainability to reducing waste, which in turn respects the environment and makes business financial sense.

Sustainability is gaining traction in today’s cutting edge discussions. Whenever a topic pops up in multiple places suddenly, I take notice. I’ve read multiple articles in trade publications and magazines, attended a keynote at an international trade conference devoted to the subject and even read how my alma mater has developed a leading program in sustainability (of course!). So, what’s all the fuss?

Several years ago, when the subject first started coming up in conversations, I wondered how this topic made business financial sense. Then, after a bit more research, I discovered I’d been working sustainability aggressively for many years and just didn’t realize it – in essence, it is common sense!

I thought the University of North Carolina Business magazine defined it best – “Sustainability is about doing what’s best for everyone involved – from shareholders to customers to employees and the community – in a way that respects the environment while ensuring financial returns for the company.” Thus, who wouldn’t want to be sustainable? Given this premise, I thought we’d discuss a few ideas of sustainable strategies a company could consider: 1) Optimize packaging. 2) Reduce waste. 3) Optimize freight.

 1. Optimize packaging. When I was in my role as VP of Operations for a mid-sized manufacturer, we were relentless on sustainability – known to us as packaging optimization. Since we were in the midst of two major initiatives, redesigning our product for a new product launch and redesigning our product as a part of a cost reduction project while maintaining product performance, it made sense to include packaging in the process.

There were countless opportunities in packaging. A few examples include: 1) Compressing the product so that it fit into smaller plastic packages (or more items fit into the package) which then fit into smaller boxes (or more of them fit into the box). 2) Partnering with suppliers to develop new materials or tweak materials so that we could have a thinner material which still met product performance expectations and manufacturing expectations. 3) Taking a cross-functional view of packaging with logistics to optimize the number of boxes on a truckload, minimizing potential damage and optimizing storage and warehousing efficiencies. And the list goes on…. Each of these initiatives helped to improve the bottom line. 

2. Reduce waste. Sounds simple and is the mantra of not only lean, the Toyota Production System and just good common sense but also sustainability. Each dollar of waste reduction = sustainability.

Since there have been mountains of data written on lean, my preference is to “keep it simple” – look for ways to reduce waste in your organization (ranging from reducing scrap on the manufacturing floor to reducing the number of steps required to process an order to reducing inventory levels), and then put plans in place to address the opportunities. It is as simple as that. In my experience, common sense was the 80/20 of reducing waste. Of course, you’ll run into technical issues etc., but there are always ways to resolve if the appropriate people are involved. 

3. Optimize freight. Certainly anything you can do to optimize transportation costs will achieve the desired end result. Therefore, consider some of the following – Can you optimize your routes? Implement milk runs? Utilize pooling? Implement transportation optimization software to improve transportation efficiencies? Combine rail and over-the-road? Consider redesigning your transportation strategies (sourcing study)? Again, there are many options. Improving your transportation processes will likely reduce costs, gas, etc. – and, many times, you can do it with improved customer service!

These are just a few sustainable ideas. They are largely common sense and do not require significant capital/ cash. As you can see, there are countless strategies which will drive the triple bottom line – people, planet and profit. Why not start with one that fits with your company and then tackle them one at a time? It is likely to not only drive results but also create an engaging teamwork environment.

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Emerging Supply Chain Trends

 



Emerging Supply Chain Trends

September 12th, 2013

Stay on top of trends to stand out from the crowd.

Those executives who stay on top of the latest trends and search for patterns and trends in their business are far more successful than their counterparts. In my 20+ years of experience across multiple industries and globally, I’ve seen the value of being on the edge of identifying and leveraging trends.

This is especially valuable if you are able to look across organizations inclusive of types and sizes – if you see something in common, you’re likely to have a gem!

Now the question is how to leverage these trends. Identifying is useless without the ability to put it to good use. So, let’s look at the latest supply chain trends keeping execution in mind:

1. Collaboration: You can no longer be successful if you aren’t focused on how to expand and add depth to your collaboration efforts. Do you partner with suppliers or pound them over the head about price? Do you find ways to collaborate with your customers to get a better handle on demand data? If so, you’ll have superior service and cash flow. S&OP is one vehicle to consider.

2. Innovation: It is no longer acceptable to be an exceptional implementer; instead, you must innovate to stand out in the crowd. How can you elevate customer service while reducing cost and increasing profit? Doing what you used to do better will not cut it! You must innovate.

3. Risk Management: What could be more important in today’s new normal global business environment? Earthquakes. Tsunamis. Political conflicts. Strikes. Currency swings. Are you prepared? How agile is your supply chain? Customers will still expect on-time deliveries of the highest quality!

4. Sustainability: What started as a way to improve the company image and address regulatory concerns is emerging as a competitive advantage. It’s starting to offer profit improvement – the triple bottom line is here to stay. How can we be green “and” increase profits? It doesn’t hurt if you circle back to innovation… You’d be surprised what you can achieve – even areas like packaging can be ripe with opportunity.

5. Big Data: As we are increasingly living in an information overloaded society, we must find ways to sift through the data to find what will matter. How do we glean intelligence from it and translate it into business advantage? It is no longer limited to a techie topic; those who leverage big data to drive results will sustain a competitive advantage.

Assuming you jump on these trends, the only potential roadblock is your people. It is becoming increasingly paramount – and difficult – to find exceptional supply chain talent. Make sure your company stands out in the crowd and values supply chain talent, and you’ll be well on your way to achieving success.

Think about how these trends impact your business. Since my brothers used to be heavily involved in ice hockey, one of my favorite analogies becomes applicable here: How can you skate to where the puck is going instead of skating to where it is?