Archive for the ‘Reporting & Analytics’ Category

Are you Multi-Tasking or Asleep at the Wheel? A Lesson from Home Depot

January 23rd, 2011

So I just finished reading an interesting article in Business Week entitled “Home Depot‘s Fix-It Lady“. The article was from the magazine’s JAN 17-23, 2011 issue and was sub-titled “Chief Financial Officer Carol Tome has a shot at CEO, if she can solve the retailer’s technology problems”. Of course the mention of technology and a brand like Home Depot piqued my interest so I read on. Less than five paragraphs in and I was stopped in my tracks by what was either a blatant editorial misrepresentation or a serious case of rationalization by the Home Depot execs. And by a case of serious rationalization I mean the kind where you break you’re New Year’s Diet Resolution with a Peanut Buster Parfait from Dairy Queen on the assumption that the delectable desert does have milk as an ingredient…and everybody knows milk is a good source of calcium, right?

Well, in Home Depot’s case the article premised that Home Depot was so focused on new store openings through the first decade of the 21st century that they lowered their focus on technology in the stores and their overall operations. Because of this they are now doing what amounts to a “tech catch-up” with Carol Tome leading the charge. Here’s the thing….I have to call some serious BS on this one. Why? Simpy put, you can’t be a publicly traded company with a $60 billion market value and somehow wake up in 2008 and decide that the Internet and technology may be a good idea to explore. It’s embarrassing.

The reality, if I must speculate, is that the executive team at the very top was out-of-touch with the operational environment that the store managers and staff were dealing with. Unfortunately, in today’s market it is not enough just to have operations that can execute effectively. In Home Depot’s case they were executing in the early 2000′s, they were growing revenues and expanding their store footprint. However, the tragedy was they WERE NOT doing this WHILE also improving their technology.

For supply chain companies the lesson to be learned from Home Depot’s story is you have to develop an operating environment in your company that assumes technology is a key enabling tool to facilitate achievement of more revenue, higher profits, and delighted customers.

In the supply chain arena a key reason for ensuring your technological initiatives are a basic part of your operational plans include:

1) Heightened Expectations from Customers – The great thing about technology is that we can now be connected almost anywhere. The bad news for logistics entities is that this era of instant access has altered what your customers want. The 60-year old procurement guy who is nearing retirement will be replaced by a 25 year old. And guess what happens. The 25 year old has grown up with iPods, iPads, Twitter, Facebook and a bad case of ADD. His questions, view and approach will baffle the provider organizations that haven’t caught up.

2) Dwindling Resources – Not to sound ominous but the reality is natural resources like oil and their by-products are not infinite. This limited quantity coupled with a rapidly increasing populous that is entering the middle class creates some staggering calculus. The result of this environment is that companies should always be in a fight internally to understand how they can push initiatives that reduce waste and protect valuable resources. Ultimately this translates right back to the bottom line.

So the moral of the story is simple – Don’t Rationalize. Figure out a way to drive your operational plans while also improving the basic infrastructure of your operation. After all, isn’t that why executives get paid… in the middle-management world its called “multi-tasking“.

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Posted in 3PL Insights, Cost Efficiencies, Process Improvement, Reporting & Analytics, Strategy, Supply Chain Technology, Supply Chain Thoughts

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Supply Chain Leaders Need to Catch up with Today’s Technologies

December 22nd, 2010

Technology, A Key Tool for Your Supply Chain

“Four-who?…Oh FourSquare you say? What’s that – a new coffee shop?”

Go inside your supply chain department and start talking with the folks that make up your broader team and I suspect the above is the type of conversations you’ll end up having with many of your peers and leaders when it comes to new technologies.  I will say right off the bat – I don’t think anyone is a bad logistician or supply chain operator if they don’t know who FourSquare is or how to Tweet. The broader point to be made is that today’s supply chain organizations need to make sure they are keeping up with a broad spectrum of technologies that could mean big changes for their companies and their supply chains.

I think the supply chain, in particular, suffers more than most organizations when it comes to technology awareness because often times the supply chain leaders are those that got their start as operators. Whether they did their time in the supply chain fulfilling positions like warehouse managers, planners, or on the transport side, many of today’s supply chain execs are all people who have come up through the heavy-duty ranks of operations. As most of us operators known, I started on commercial vessels sailing the ocean-blue (see below pic), the operational setting is a spartan one where you often times make do with what you have. This make do with what you have is great for the income statement but not so great for ensuring you’re always one step ahead of your competitors. In the last twenty years, the supply chain has undergone a radical transformation. The advent of MRP and then WMS and TMS systems has created dramatic efficiency in just about every nook and cranny of the supply chain.

I believe the best has yet to be seen and the next ten years of innovation in the supply chain is really going to be incredible. We are just now starting to scratch the surface of various technologies that could all have a significant effect on supply chain costs. Some of these technologies include things such as:

This is certainly good news for all of us. I think the rational majority is clear-headed about the inevitability of higher fuel prices and rising shipping costs associated with higher security standards and governmental regulation.

The message is a simple one for all of us supply chain operators.  Get comfortable with technology and be equally adept at innovating as you are at driving margins and making that operation hum.

About the Author, Douglas Ingram

That's me! This particular ship was a Trans-Atlantic vessel that carrier heated asphalt at 300 degrees.

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Posted in Business Intelligence, Cost Efficiencies, Reporting & Analytics, Software as a Service (SaaS), Supply Chain Technology, Supply Chain Thoughts

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Geolocation Integration the Next Frontier for Supply Chain Entities

November 5th, 2010
Geolocation_in_the_Supply_Chain

Geolocation_in_the_Supply_Chain

As the old saying goes, “change is a coming”. These winds of change are multi-variant and are carrying a wonderfully potent mixture of geolocation, analytics, and SaaS to today’s businesses. In fact, the supply chain stands to be one of the biggest benefactors of this sweeping change.

For many years, supply chain practitioners have discussed and envisioned a future whereby geolocation data could be seamlessly linked with order execution, warehouse management systems (WMS) and or transporation management systems (TMS).  The benefits of being able to assemble this location data in real-time for the supply chain and effectively disseminate out to enterprise decision support systems and business users includes:

  1. Better Planning – understanding inventory flows at a pallet or case level and being able to understand the velocity of movement, in transit product and the position of inventory could have significant impact for corporate planners trying to appropriately allocate manufacturing capability, purchasing decisions and procurement of input materials.
  2. Optimization of Network - today the supply chain network of companies large and small is constantly in flux.  Things such as seasonality, promotions, rain fall, weather, fuel costs and other variables can significantly alter product flows from traditional patterns.  This constant flux makes it difficult for supply chain tacticians to understand their operating environment in real time.  What typically happens in today’s world is that supply chain leadership is always looking at a dated snapshot of the network and resulting product flows.  If supply chain tacticians had the ability to visually understand their environment in real time then the possibilities become quite endless and very interesting.
  3. Audit Precision & Compliance Initiatives – Another benefit of maintaining geolocation data that may not be so obvious is the financial benefit that could be realized.  In transportation, a common variable used in calculation of costs for over the road type movements is mileage.  With geolocation capability tied to various gates in a shipment’s lifecycle such as order confirmed, pick confirmed, in-transit, and POD, a procurement team could use time stamp data correlated with latitutde and longitude information to deduce actual mileage transited, cost estimates, route traveled, and velocity at various checkpoints.  With the same geolocation information described companies could reference rules and ensure compliance with either internal policies or insurance mandates.  An example of this could be the idea that a tractor-trailer cannot exceed some average speed.i>
  4. Green Initiatives – As green initiatives continue to take over old-school industries geolocation data can help  supply chain departments to gather the critical intelligence they need to undertake carbon footprint measurements and other green related initiatives.  Other capabilities provided by having precise location information
  5. Customer Service – An excellent use for geolocation data could include the ability to more accurately measure transit times from frequented origins to destinations.  For example, consider the case where a large distribution facility in a metro area restocks materials to numerous homes, stores or smaller warehouses in the state.  By maintaining geolocation data the distribution facility could more accurately assess transit times to each end destination, by time, by day, etc.
  6. New Service Offerings & Market Differentiation – The market for transportation services and third party logistics services continues to grow and become more competitive each year.  With geolocation capabilities transportation entities can offer new services to their customers and help differentiate their offerings from a sea of competitors and look-alikes.
  7. Safety – As the recent bomb incidents on board UPS planes indicated, we live in an increasingly dangerous world where cargo operations are being used as a mask for potentially nefarious activities by terrorists and wrong-doers.  Geolocation and its integration into asset management systems, inventory control and transport management could help provide corporations with clear visibility into key personnel, assets and product flows at all times.

So the question beyond what benefits will geolocation bring is one of how does it become a reality, what are the steps and what may be some of the most present obstacles today.

To usher in the type of benefits that can be realized from geolocation organizations need to have a few basic building blocks in place.

  • Centralized Data w/ Well Defined Schemas
  • Integration with Key Order Management, Inventory Management and Transportation Systems
  • Modern Applications Frameworks  (SOAP, REST, etc.)
  • Deployment of Applications to Diverse Devices (Web, SmartPhones, iPads)
  • Capability to Assimilate and Make Sense of Data (i.e. Business Intelligence Platforms)

The last point may be one of the more important points to make.  The premise of geolocation by default also means a literal avalanche of data.  In the example that was given above imagine a distribution facility normally has 100 orders a day to local destination points. With geolocation enabled these 100 orders could potentially produce tens of thousands of records with juicy tidbits like latitude, longitude, time, vehicle ID, driver ID, temperature, etc.  Without proper business intelligence platforms this data is somewhat useless.

Geolocation has some awesome capabilities for the supply chain and I am hopeful that with recent announcements and initiatives from government entities and startups alike that the promise of geolocation will soon be supplanted by a more widespread reality and many real-life implementations.

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Posted in Business Intelligence, Event Management, Geolocation, Reporting & Analytics, Sensor Technologies, Smart Phones, Software as a Service (SaaS), Supply Chain Thoughts, Supply Chain Visibility

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In the Cloud We Trust…Supply Chain Moves to SaaS

April 5th, 2010
Supply Chain SaaS

Supply Chain SaaS

Anyone who has been involved in business for any length of time knows that today’s winning formula can quickly turn sour. Certainly, the job of a leader of any organization is to closely monitor the environment in which they compete to “read the tea leaves”.  Reading the tea leaves involves picking up on nearly imperceptible movements in the market, monitoring casual organizational chatter, watching competitors activities, and in general staying plugged in.  Part art and part science, these combined activities require “Sherlock-Holmes-esque” investigative abilities combined with a knack for piecing it all together.

I’ve been pulling the pieces together for a bit in the broader supply chain industry and have been observing some very interesting trends that appear to be converging in a more rapid fashion that most in our industry are accustomed to.  This convergence centers on the adoption of cloud-based solutions (aka Software as a Service (SaaS)) within the supply chain industry to facilitate challenges to common problems.  The reasons for SaaS adoption are numerous and I will spell them out further in the post.  However, let me first point to some of the anecdotal data which starts to draw the first brush strokes of this very interesting picture:

NOTE: In case you have been living under a rock for a few years follow this link to get a better understanding of SaaS.

Anecdotal Data Relating to SaaS & Supply Chain Adoption

  • Trade publications & industry followers, leaders and authors are commenting and talking more frequently about impact of SaaS specifically in the supply chain
  • Major consulting shops are augmenting and setting up departments devoted to advising & helping to roll-out SaaS solutions
  • Major supply chain oriented publications begin displaying larger & more frequent advertisements for SaaS solutions in WMS (Warehouse Management Systems) and TMS (Transportation Management Systems) areas.
  • Traditional software vendors are beginning to release “cloud-based” versions of their standard offerings
  • Emergence of more case studies focused on SaaS type deployments and the resulting efficiencies gained by coalescing processes, data, and analytics

Technologists would look at the above points and most likely reply with a giant…”Duh”…or, “Your point is what exactly?”.  To them I would say this.  For supply chain operators and hard-core logistics guys the migration to the cloud and impact of SaaS is just now starting to be more broadly discussed.  These discussions are being driven because of the economics associated with Saas, economics that I have seen first hard in my business dealings.  Ultimately, some of the big advantages of SaaS for the supply chain industry are:

  • Ease of Roll Out: Instead of getting bogged down with install disks, scripts, instructions for loading, etc. – many of the SaaS tools are as easy as a web link, a user name & password and you’re up and running.  For highly diverse environments like the supply chain this is a definite advantage.
  • Immediate Upgrades: Worried about the latest patches and the most recent version? With SaaS solutions the versioning, patches, etc. becomes transparent to the user.
  • Right-Sized Infrastructure: Another benefit of the SaaS model is that companies can start enjoying the benefits of a system that might otherwise require too much up front capital to deploy.  For example, if the fixed cost of deploying a traditional software package is $100,000, a company might choose to not deploy because the fixed cost hurdle is too extreme to warrant a payback in a reasonable period of time.  However, in the SaaS environment, a company is generally able to get started for a considerably lower fixed fee and then pay a more manageable subscription or transaction fees.
  • Centralization of Data: In today’s environment, data and the resulting insights for an enterprise are critical.  Through SaaS related deployments enterprises are able to start moving their organizations towards a common environment.  In the supply chain world that is full of sub-contractors and third-parties that are located in different geographies with different technical backgrounds the SaaS model becomes a unique tool to help enterprises coalesce operations, processes and data.
  • Process Compliance: In the supply chain adherence to process is critical.  This process adherence becomes very difficult as product moves across the globe and is shuttled from warehouse to carrier to customs entities and back again.  With SaaS oriented modalities, large 3PLs and others can start to orchestrate systems and applications that facilitate compliance to standardized organizational processes.

In the complex business environment that is supply chain, the benefits of SaaS are very compelling.  A few of the areas / functions where I believe we will start to see increased adoption in the supply chain around SaaS include:

  • Analytics
  • Warehouse Management
  • Rate Audit / Spend Management
  • Transportation Management
  • Order Management
  • Inventory Control

The next 12 months promises to be a wonderful and exciting time as more and more companies migrate key functions to the cloud.  For supply chain entities looking to stay competitive this is one emerging trend that cannot be discounted.

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Posted in Cost Efficiencies, Event Management, Process Improvement, Reporting & Analytics, Software as a Service (SaaS), Supply Chain Thoughts, Supply Chain Visibility

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Comprehensive Analytics a Key Differentiator in the Supply Chain

August 16th, 2009

by: Douglas Ingram

Whether you are 3rd party logistics provider or managing your own in-house fleet of transportation assets, the need for comprehensive analytics has never been more crucial.  Today’s world of transportation, distribution and overall supply chain networks is a complex one  where the traditional lines between customer, partner, supplier, and competitor is sometimes hard to differentiate.  As these vital networks continue to elongate from a geographical standpoint and shrink from a time perspective, the need for comprehensive and more real-time analytics becomes even more important for companies wishing to realize cost savings, improve performance, and increase overall customer satisfaction.

There is an adage which states simply “anything that is measured will improve”.  It is a powerful concept and one that I have seen work in both personal and professional lives.  For example, imagine that you are wishing to shave some pounds and get in better overall fitness.  You decide that you need to take in 1600 calories per day.  You currently don’t keep track of your calorie count but decide that you will track every morsel of food and liquid that touches your mouth.  In your trusty notebook you begin to take detailed notes on everything and magically you realize you have a tendency to snack heavily in the evening and blow through your 1600 calorie goal.  Long example, point is this.  If you set a goal and don’t track your activities towards the goal, the goal itself is always elusive.

This old adage can be a powerful force in your supply chain practice and help your division, group or company achieve even better results than you do today.  In today’s world, most companies have some form of metrics tracking in place.  In the various positions I have held with numerous companies my general experience is that the tracking and measurement falls into 2 general categories:

  1. Abundance of Data – Dearth of Analysis > In this world, the company or group of companies have massive amounts of data through connected databases, enterprise systems, etc.   The challenge is the proper assimilation of the data and drawing meaningful relationships between the various points of information.  This environment is analogous to having a Ferrari with only 2 gears. (i.e. – all the right machinery is present to take you to 200 mph, but its not connected properly)
  2. Stove Pipe City > This environment features data, reporting and insights.  The typical problem in this environment is that the reporting is somewhat one dimensional and doesn’t properly join in the other reporting environments.  The real challenge here is that different constituencies start to draw their own conclusions so that the organization ends up with several “opinions” on the state of the business versus one de-facto, cooperative data-store.

Within each of these general environments the opportunity exists to take your corporate reporting around the supply chain function to loftier heights.  The keys for a successful and comprehensive analytics program in the supply chain starts with these key ingredients:

Supply Chain Dashboard

Supply Chain Dashboard

  • Support – from the executive office to the line manager, the company must have support for the initiative.  A key part of building support is specifically identifying the benefits of a analytics initiative.
  • Vision – a compelling view of analysis and reporting and how it will help accomplish the stated goals.
  • Inputs – ensuring that each part of data that the business needs access to is made available.
  • Accountability - key stakeholders must be accountable for results but also be empowered with varied resources and the proper mandate to achieve the stated results.

With these ingredients and the properly placed momentum any organization can start to leverage data in their businesses into meaningful and actionable insights.

Update: 9/7/2009 > Thanks to Kinaxis (www.kinaxis.com) and their discussion of this article on their Blog titled: “How do you track metrics against your supply chain?” published on September 4, 2009

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Posted in Reporting & Analytics, Supply Chain Visibility

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