Logility Supply Chain Management Blog

Seco Tools: Cutting Edge Supply Chain Strategy Takes Shape

Mon, 29 Apr 2013 09:15:00 GMT

For more than 80 years, Seco Tools has delivered a diverse portfolio of tools and services around the world. Best known for milling cutters for the general machining industry, the pressure the company faces to maintain high service levels continually grows. To complicate matters, they must be able to provide the right consumable product at the right time to customers on all four corners of the globe.

Seco Tools manufactures cutting tools made of steel, tungsten carbide and cobalt. The tools are based on industry standards which allows each customer to select their supplier. If a tool cannot be supplied when it is needed it is very easy for the customer to secure a new supplier. The burden is now on Seco Tools to deliver any of its 50,000 SKUs anywhere in the world within 24 – 48 hours.

Historically, customers held their own inventory. They kept a supply of products on hand at every site. This became an expensive proposition for the industry, which gave way to placing the responsibility (and cost) back on the manufacturer to hold inventory and deliver it when needed. At first manufacturers held stock in-country. This created a vast and costly distribution network for manufacturers such as Seco Tools. As competition increased and margins thinned, manufacturers had to turn to a more streamlined distribution approach that would still ensure quick delivery of each item.

As part of this shift, Seco Tools now operates four distribution centers around the world (Netherlands, Troy, MI US, Singapore, and Shanghai). From these four locations the company serves approximately 60 countries. The key is the ability for Seco Tools to provide the same level of service through fewer distribution points.

Supply Chain Planning Overhaul
Three years ago Seco Tools investigated solutions for stock optimization. During this process, the company realized it needed more than stock optimization—it required a complete supply chain planning overhaul. According to Lars Liljeqvist, VP Logistics, Purchasing and Quality, Seco Tools, “We saw an opportunity to improve our stock availability and lower our inventory value at the same time. We also realized this would be more than a software implementation. In order to succeed, we needed to change our processes and way of working.”

Seco Tools required new software to support the new processes and they started to evaluate potential partners. Many of the vendors only offered software. Seco Tools recognized they also needed help with their process change. “Logility was unique. The team met with us and started to discuss how we could improve—the supply chain processes and organization. We walked through the process and covered both the tangible and intangible benefits. Then we talked about how software could help enable this transformation,” Lars continued.

Moving Forward
Previously the company’s forecasting operated at a very high level (for example the product/family). To be truly efficient, Seco Tools needed to forecast at the item level by stock location to help its 12 production facilities better plan their manufacturing requirements. “We must make sure we produce and stock only what we need,” Lars commented.

Seco Tools recently completed the first phase of its implementation of its new processes and Logility Voyager Solutions. Within the first week, a couple of days in fact, the team noticed a drastic improvement in visibility across the global business which will help further improve forecast accuracy.
“We have a target to achieve a 97% net stock availability and we can already see with Logility we will be able to achieve this number,” Lars said. Seco Tools is also aiming to reduce inventory up to 20% thanks to the greater forecast accuracy. In a competitive industry manufacturing precisely machined tools, a reduction like this can add up quickly.

Lars continued, “The implementation was on time and the visibility we now have gives us new understanding. We’re asking questions we never would have thought to consider before Logility. The combination of an excellent supply chain team, improved processes and new software has shown us just how much potential there is for improvement. It is quite remarkable.”

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Inventory Optimization Maturity Curve: A Walkthrough

Thu, 25 Apr 2013 08:44:02 GMT

As I talk to customers and practitioners from all corners of the supply chain world, I find that Inventory Optimization has different meanings between companies, departments and even people within the same organization. It is described as everything from simple inventory management techniques all the way to advanced multi-echelon inventory optimization.

Recently I presented at a local APICS event on the Inventory Optimization Maturity Curve. In the presentation I took the audience on a quick guided tour through the different levels of inventory optimization and what we mean by each, from the tactical deployment of safety stocks for SKUs to the strategic use of inventory analytics in driving the sales and operations planning (S&OP) process.

To provide a useful context around this, we can determine where we are on the maturity scale and initiate the process to move up.

At its simplest level, many organizations start by applying science to inventory with a single item, single location safety stock calculation to define how much inventory is needed to cover demand, lead times and ordering frequency for a given level of service. Most companies start this inventory journey either through spreadsheets or by using the simple safety stock modeling capabilities of an ERP system.

In my experience today many companies are at this ‘rules of thumb phase’. If this describes your situation, don’t feel bad, you should be excited because you have a big opportunity. Don’t be scared by the prospect of optimization – because there are some simple things you can do to gather that low hanging fruit.

The next level of maturity is to set a statistical safety stock systematically for all item locations as part of the tactical planning process, and to introduce some more advanced considerations like supply and demand uncertainty and time-phasing of the safety stock. Here we model the supply chain from raw materials through work in process and out into the distribution channels to the customer. Uncertainty can be propagated up and down the chain, understanding the interdependencies of each node in the supply chain.

This approach requires complex non-linear math that provides a degree of inventory optimization you cannot get from single tier solutions. It provides great strategic information that allows you to understand analytically the causes of inventory, target strategic improvement initiatives that maximize performance, and truly approach ‘best in class’ in inventory optimization.

The next level in the maturity curve is MEIO – multi-echelon inventory optimization. Single node or tier inventory optimization is great – but it doesn’t help with the greater challenge – optimizing inventory across a supply chain network. Having multiple tiers in your supply chain typically causes more inventory to be held. There is typically double buffering for the same uncertainty and no real idea of how inventory decisions in one tier impact the cost and service of the overall supply chain. This is where the concept of multi-echelon inventory optimization comes into play.

Remember, optimization is not just about reducing inventory, it is about getting the correct inventory to support your service goals – the optimal mix of inventory.

To learn more we created a podcast from this APICS presentation, “The Inventory Optimization Maturity Curve.” (registration may be required)

By Chris Russell, vice president, Logility
Read more by Chris.

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Demand Forecasting: The Unfair Competitive Advantage

Tue, 23 Apr 2013 09:15:00 GMT

Here’s a common “what’s wrong with this picture?” scenario: in many supply chain organizations, sub-SKU forecasting (the task of translating high-level forecasts into specific quantities by size, color, configuration, region, etc.) falls on the shoulders of the sourcing and supply functions, rather than the demand planners. Why? The simple answer—it has always been this way. Does that make it right?

Supply planners and sourcing groups have less exposure to the market demand yet are expected to fully understand what is going on. Taking the burden of ad hoc SKU-level forecasting off their shoulders would help them focus on improved procurement decisions and meeting vendor minimums more cost-efficiently.

Demand Planning: A High-Level Activity

Aggregating provides accuracy. For example, it is easier to forecast how many SUVs will be sold in North America this year versus how many white LX models with a sunroof will be sold in Miami over Memorial Day weekend. Product attributes such as finish, style, color, size, speed, trim level, and configuration complicate forecasting at granular levels.

Without doubt, product family-level forecasts that are accurate enough for monthly sales and operations planning (S&OP) meetings can be significantly skewed at the SKU/location level. However, if one disaggregates through proportional profiling (or as Supply Chain Digest’s Dan Gilmore called it Sub-SKU forecasting in this video), demand planners can use historical sales figures to deepen their forecasts to the sub-SKU level—three, four, or more attribute levels (e.g. model / capability level / feature configuration). Now forecasters can work at a level of aggregation that matches their business requirements, while allocating the forecast accurately across product attributes and options before submitting to the supply side.

This accurate fine-grained demand plan provides the supply-side team vital insights that lead to smarter decisions.

So we officially have a new “unfair” competitive advantage: granular forecasting early in the supply cycle as part of up-front demand planning—the early bird gets the worm! Translating demand plans into sourcing, supply, and production plans sooner sets important aspects in place before all product decisions have been made, vendors have been selected, or the forecast is complete. Production schedules and capacity planning can get underway with enough lead time to create smoother and more efficient production runs.

It is time to take the sub-SKU forecast burden off of the supply team.

Related Information

White Paper: Reaping the Rewards of Sub-SKU Forecasting
Dan Gilmore Video: Supply Chain Digest’s Cool New Product of the Month
Video Mini-Brief: Introduction to Proportional Profile Planning

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S&OP Research Study Needs YOU!

Fri, 19 Apr 2013 13:22:25 GMT

Ever wonder where analyst data comes from? The best research requires input from supply chain experts like you!

Get your voice heard and share your insights on how Sales and Operations Planning (S&OP) is conducted at your company. Lora Cecere, founder of Supply Chain Insights, has kicked off research for the report, "How S&OP Drives Agility."

Don’t Be Afraid of S&OP: Four Simple Steps to Jumpstart your S&OP Process

Thu, 28 Mar 2013 11:21:32 GMT

The 70% Enigma
I recently read a roundup of all the research Gartner Group has published around sales and operations planning. I’m struck by the fact the research points to 70% of companies are at a maturity level of 2 or lower even after 30 years of S&OP chest beating by the supply chain industry.

Tales from the Trenches: On the Road to Supply Chain Success

Fri, 22 Mar 2013 09:21:15 GMT

If you're reading this, chances are you've either lived through a supply chain solution implementation project, you're considering one, or perhaps you've lived through a less-than-successful project and are simply curious.

The Next Generation Supply Chain Leader

Wed, 06 Feb 2013 11:40:29 GMT

Can young, smart, driven supply chain students and their professors teach us anything about the future of supply chain?

Recently I went to the MIT Media Lab Building for an event co-hosted by the local chapter of CSCMP and MIT Center for Transportation and Logistics.

There were two things going on. The first was a MIT Supply Chain Student Poster Session and Networking Night. Two big rooms were lined with the logistics projects from graduate students of MIT’s Logistics programs. The students themselves were on hand to explain their projects, interact and answer questions.

ChainLink Research: Caribou Coffee’s Supply Chain Story

Mon, 04 Feb 2013 11:30:16 GMT

Ann Grackin and Bill McBeath of ChainLink Research recently published an article on Caribou Coffee’s supply chain. They spoke with Karen Francois, senior director of strategic sourcing at Caribou, to learn about the coffee retailer’s supply chain challenges and how the company reshaped its processes and turned to technology to help enable its success.

Supply Chain Congratulations in Order!

Wed, 19 Dec 2012 15:31:14 GMT

The supply chain and software industries have several high-profile awards and distinctions. We, along with our customers, have been fortunate to win many over the years. There is another award program that is very special to us, our SAILS Award.

5 Management Tips from the Mountain Bike

Wed, 12 Dec 2012 08:30:05 GMT

A few years back I started supplementing my penchant for marathons and triathlons with mountain bike riding. A mountain bike is a specially designed bicycle that you take out into the wild to traverse all sorts of rugged and crazy terrain.

I’m only an amateur, at best, but like every new endeavor it’s fun to learn something new and it’s fun to draw parallels to different disciplines.

Ask the Expert: Supply Chain Innovation – Don’t Chase the Shiny Object

Mon, 12 Nov 2012 15:18:52 GMT

Innovation is a term we hear often, especially in the world of software development. But what does it mean? What should it mean? I looked up the word innovation and found something odd. I found the word novelty next to innovation. With the pace of change today I believe many people are confusing the next shiny object or fad (novelty) with innovation. Instead we should focus on innovation that drives differentiation. In terms of the supply chain, innovation can drive rapid product development and build a competitive edge.

Aftermarket Parts and Service – Break Away from Convention

Thu, 25 Oct 2012 14:37:34 GMT

According to Gartner, the typical company provides support services and parts for an average of more than seven years after an initial product sale. In the U.S. alone, consumers and businesses spend more than $700 billion per year on spare parts and services. Additionally, the aftermarket parts and service industry has profit margins as much as 10 times those for initial product sales, and post-sale service is key to securing customer loyalty, fostering the company brand, and maintaining competitive differentiation.

Supply Chain Gamification – Socially Intense and Highly Collaborative Wins the Game

Thu, 18 Oct 2012 14:07:32 GMT

When I was working with finite scheduling systems in the 90’s I was struck by how “video game-like” some of the systems were. Unscheduled work orders fell from the sky, were grabbed by the planner, manipulated, and fit into the open slots of the production schedule. It reminded me of Space Invaders or Tetris. The elements were all there. The urgent work orders came in, planners frantically manipulated them into the schedule trying heroically not to violate constraints (lose points) and achieve the most efficient output (high score).

How many items should a planner plan?

Fri, 05 Oct 2012 08:49:07 GMT

This sounds a bit like the old tongue twister ‘how much wood could a woodchuck chuck if a woodchuck could chuck wood?’ And, while it also sounds like an easy question to answer it turns out to be ‘one of those questions’ where the answer can be quite complicated.

Over the years I’ve had this question put to me many times in one form or another. I have two responses – a quick, easy answer and a longer, nuanced answer that dives into the complexity behind the question.

Demand Forecasting Excellence: Foundation for a Highly Efficient Supply Chain

Fri, 28 Sep 2012 15:54:20 GMT

Estimating future demand is one of the most fundamentally valuable, but frustratingly difficult, challenges in supply chain optimization. By “Demand Forecasting,” I mean the effort to increase forecast accuracy and customer service levels through better perceiving, predicting and shaping the full range of factors that determine how well your product portfolio satisfies market needs. No other aspect of supply chain optimization has greater impact on profitability.

Transportation Management Study - Supply Chain Insights

Tue, 18 Sep 2012 17:01:10 GMT

Lora Cecere, founder and CEO of Supply Chain Insights, is taking a deeper look at the role of transportation process maturity in supply chain excellence. As part of this research project, she has developed a brief survey to better understand today’s transportation planning priorities.

Revolutionize Your Forecast Precision Based on Market and Product Attributes

Wed, 12 Sep 2012 08:40:10 GMT

Today’s product portfolios can contain hundreds of thousands SKUs. In some cases a company must manage several million. This is not to say a company will have this many product families. In fact, many of these SKUs are based on product configurations within a product family. For example a style of shoe can have a SKU for each gender, color, size and width. A family of sofas can have individual SKUs for fabric, color, pillows, and legs. A USB memory stick can have variations for memory size, color and indicator light.

Ask the Expert: Three Questions on Inventory Optimization for Sean Willems Ph.D.

Mon, 20 Aug 2012 08:50:12 GMT

Interest in inventory optimization continues to increase as companies seek a more efficient way to reduce excess inventory while maintaining or improving customer service levels. Multi-echelon inventory optimization (MEIO) is also playing a larger role in the sales and operations planning process (S&OP). Recently I sat down with Sean Willems, Ph.D., associate professor of Operations Management at Boston University's School of Management and Chief Scientist at Logility, to get his thoughts on inventory optimization misperceptions, S&OP, and centralized vs. decentralized initiatives.

An Executive Q&A – Challenges of a Private Label Manufacturer

Wed, 15 Aug 2012 09:09:08 GMT

As an alternative to playing the discount game and further eroding margins, many retailers have found tremendous success with private label products. By offering innovative goods at a reasonable cost, retailers have successfully distinguished their brands and helped engender consumer loyalty. This is a sound strategy, but it can easily backfire if the supply chain infrastructure is not in place to support it.

The Challenges of Global S&OP

Mon, 06 Aug 2012 09:12:46 GMT

What do you want to achieve? Where does your company want to be in 12, 18, 24 months? Do you know? If you don’t know where you are headed, any road will take you there. How will you know what success looks like? In today’s uncertain times, a clear vision and strategy of where you need to be is the key to rally the company and propel your business forward; forward into new markets, new geographies and ahead of your competition. Success lies in the ability for your company’s stakeholders to tie your goals, strategy and execution into a single, measurable plan.

Not So Hidden Inventory

Tue, 31 Jul 2012 09:05:11 GMT

Recently, we were asked by the management of a manufacturer to help them assess why inventory levels were so high and trending upward. We went to the manufacturing plant to survey the scene, to see if we could determine the root cause of their inventory problem.

Clue #1: The earnest young materials manager we interviewed stated, “We don’t have any inventory. We only buy and make what our customers order.”

There was a major disconnect here. This gentleman was telling me they had no inventory, but I had a corporate controller with a balance sheet stating in black and white they had too much inventory.

Remembering the Impact of Stephen Covey and The 7 Habits of Highly Successful People

Fri, 20 Jul 2012 09:02:38 GMT

Every generation has its thought leaders. Mine had Stephen Covey and The 7 Habits of Highly Successful People.

Hearing of Stephen’s death this week I looked at my bookcase to see a copy of his seminal work. While I believe I gave the original copy away, his work was so powerful I made the effort to pick up another copy. This is one of the few books that I thought important enough to have its physical presence near me through all the office cleaning campaigns. There are not many works one can say that about.

Supply Chain Automation and Intervention

Thu, 19 Jul 2012 09:05:37 GMT

I recently read an article about a robot that can be controlled by human brain signals. The human, in this case a paralyzed individual, wears a skull cap with electrodes that picks up and amplifies the electronic signals emitted by the brain.

This is difficult, but fairly straight forward. The subject thinks about an action such as moving a finger and the scientists isolate the brain signals associated with the thought process. They write some code which translates the received signals into action commands for the robot. When the subject thinks about moving their finger the robot finger moves.

Gartner: The Supply Chain is Getting Harder

Tue, 22 May 2012 08:37:03 GMT

What is your moon?

That was the question Michael Uskert, managing vice president, Gartner, asked at the end of the day 1 keynote at Gartner’s 2012 Supply Chain Executive Conference. The opening keynote, which included presentations from Jane Barrett, group vice president, Gartner, and Dana Stiffler, managing vice president, Gartner, connected the United States’ goal of going to the moon with today’s supply chain challenges.

Multi-Echelon Inventory Optimization and Network Design - Differences?

Wed, 09 May 2012 09:15:52 GMT

I find this question comes up a lot as the lines of understanding start to blur the two offerings.

At the heart of this confusion is the network. Any time you want to optimize across an enterprise, whether it is inventory or product flows, you need to represent a logical representation of the supply chain. This creates a structure that math can be applied to. In this way the network structure is the ‘bones’ of the supply chain around which the optimization can be performed.

Do Wholesale Distributors Think in Terms of Supply Chain Optimization?

Wed, 02 May 2012 09:32:41 GMT

Not all wholesale distributors think in terms of supply chain optimization—but they should. Faced with growing costs, demanding customers and paper thin margins (net margin is often under 1%), supply chain management often separates successful distribution companies from those that constantly struggle.

Supply Chain Urgency and Economic Fear, Cycles Really

Wed, 11 Apr 2012 11:15:41 GMT

Why are phrases such as “especially in the current economy” so in vogue in everything from analyst research to white papers and presentations? The phrase has become part of our lexicon, but that baffles me because we’re not just in the ‘current economy’—we are moving forward in an ever-changing, global economy.

On the horns of a dilemma

Tue, 03 Apr 2012 10:36:25 GMT

Sorting out the balance between standardization and quality

User: “Corporate is pushing a non-functional system on us. We’ll have to do more work, our costs will go through the roof and we’ll lose customers…don’t they realize this will be a huge step backward for us? Are they nuts?”
Exec: “These users are being total luddites, digging in their heels and dragging their feet. Don’t they realize the savings in efficiencies this corporate system will bring? It’s like they’re trying to put us out of business. Are they nuts?”

Sound familiar?

Three Rules of Inventory

Fri, 16 Mar 2012 15:36:58 GMT

Bryan Ball, vice president and principal analyst, supply chain management, Aberdeen Group, has outlined three rules to follow in his latest report, “Inventory Optimization - Impact of a Multi-Echelon Approach.” Rule 1: Always have enough. Rule 2: Never have too much. Rule 3: Never let Rule 2 overrule Rule 1

The CFO and the Supply Chain

Fri, 16 Mar 2012 15:10:00 GMT

CFOs strongly believe good supply chain performance is vital to financial success and studies have shown a majority of CFOs believe the supply chain is directly linked to their ability to meet corporate objectives.

For these reasons, the supply chain is a natural focus for CFOs. It determines how cash will flow through the business and where capital will be invested to fuel the company.

Secrets to a Short and Happy Life

Tue, 28 Feb 2012 09:30:29 GMT

If you wake up one day in an industry where 90% of your products’ revenues are generated in the first three months, you don’t have enough historical data to generate an accurate statistical product forecasts, and your global sourcing and manufacturing networks create long lead times with high supply variability…congratulations, you have probably landed in the electronics sector.

Welcome to a business where turning out the next “must have” new product generates excitement and almost half of failures are due to initial misreads of market expectations. According to Gartner, [...]

Supply Chain Management – A 2012 Priority

Wed, 22 Feb 2012 09:03:51 GMT

ChainLink Research and SupplyChainBrain just released “Business Priorities 2012 – Research and Results” which takes a look at where companies will invest in the coming year. The report provides a cautionary, optimistic view of the coming months saying, “Many unsettled issues are still outstanding […]. And yet, our respondents do expect business expansion and intend to invest to make it happen in 2012.”

While the economic climate may be uncertain, many companies realize they have to invest in areas such as supply chain management software to be competitive and profitably grow. [...]

Get Smarter - Inventory Optimization

Fri, 10 Feb 2012 15:27:56 GMT

Your supply chain mission:

Improve service levels to the high 90’s
Increase inventory turns
Decrease obsolescence by 50%

No problem you say out-loud while you quietly ponder the multiple scenarios that might get you there. You could increase inventory to get you to the high 90s. But that will incur more cost. You can decrease inventory to improve turns and obsolescence but then you sacrifice service. Could this supply chain mission be a lose-lose situation?

Consumer Goods Technology Releases List of Top Supply Chain Companies

Fri, 10 Feb 2012 14:52:37 GMT

Consumer Goods Technology recently released its 2012 Consumer Goods Technology Reader’s Choice survey results. In Supply Chain Planning, Logility was voted highest in customer experience of all solution providers. This recognition highlights our dedication to developing supply chain software that exceeds expectations and drives tangible results for our customers.

In addition, Logility was named a top supply chain solution provider in both supply chain planning and supply chain execution for the 12th consecutive year.

The article features Lee Dame, vice president of supply chain at CooperVision on his thoughts of Logility. "Logility's robust product functionality and great customer support allows us to effectively manage Cooper Vision’s complex supply chain, improve customer service and become more sophisticated in our supply chain approaches."

Video Podcast: Starting the Inventory Optimization Journey

Tue, 07 Feb 2012 14:16:56 GMT

One of our resident inventory optimization experts, Chris Russell, recently spoke with Greg Novitsky, global supply chain analyst at Celanese about the journey to optimize inventory. In this video podcast, Greg provides a veteran perspective on the multi-echelon inventory optimization (MEIO) journey and how Celanese has been able to reach the top of the MEIO maturity curve and achieve significant benefits.

This video podcast will be particularly interesting to supply chain organizations [...]

Fewer Hunches. More Facts.

Tue, 10 Jan 2012 16:07:33 GMT

Dennis Berman at the Wall Street Journal recently said analytics will change your day-to-day world more than you know. In his article, So, What’s Your Algorithm, he points out that computer systems are now so powerful they can harvest vast stores of data in real-time to make the decisions (or recommendations) for you to act upon. The article provides examples such as analyzing the credit worthiness of tens of millions of homeowners as well as how, by analyzing traffic flows, the system can tell a driver the most efficient route to take on any given day.

How far is this from reality?

Video Podcast: Apparel Supply Chain Challenges – Size XXL

Thu, 05 Jan 2012 15:35:04 GMT

We work with a lot of branded and private label apparel manufacturers and brand owners, and it’s clear there is a misperception about supply chain complexity in these industries. Counter to what many people think, apparel supply chains are complex and demanding with global sourcing, long lead times, short selling seasons, and demand uncertainty. On the market side, it is extremely difficult to forecast changing fashions and fickle consumer tastes. On the supply side, we have hard-to-model constraints, costs, lead times, and vendor (maker) requirements.

MEIO By the Numbers

Fri, 09 Dec 2011 17:00:48 GMT

$20 million, $50 million, $100 million in savings. Up to 30% inventory reduction. These are just some of the amazing results from multi-echelon inventory optimization (MEIO). However, many companies (40% or more in some industries) still rely on ERP or APS for inventory optimization. Add Excel to that and the number...

Video Podcast: Five Core Competencies of Inventory Optimization

Tue, 15 Nov 2011 13:25:14 GMT

In this episode of our Beyond Inventory Optimization video podcast series we dive further into the Inventory Optimization and highlight 5 core competencies that can make or break a company's competitive advantage. This episode also features Dr. David Anderson, former head of the supply chain practice at Accenture.

ERP versus Best-of-Breed?

Thu, 13 Oct 2011 10:02:56 GMT

I recently spoke with a reporter who asked me to discuss the benefits of supply chain software from a best-of-breed provider such as Logility versus from an ERP vendor. The benefits are measurable; however I felt it important he understand the idea of a “fully integrated” system from a single enterprise vendor is just that, an idea.

Supply Chain Disruptions or Minor Inconveniences?

Fri, 07 Oct 2011 16:55:14 GMT

How do you plan for the unimaginable? Can you anticipate and properly plan for once in a lifetime events like last year’s Icelandic volcano, and the earthquake and subsequent tsunami earlier this year in Japan? Probably not.

The Supply Chain Shaman’s Top Five of Top Ten

Fri, 30 Sep 2011 10:04:11 GMT

Ever wondered what questions analysts are asked most often? What your colleagues are burning to know? Altimeter Group’s Lora Cecere posted on her blog Supply Chain Shaman, the top 5 questions she is asked. Lora’s Top Five of the Top Ten post delivers great insight, is concise and provides tangible recommendations.

Sales and Operations Planning Summit

Mon, 19 Sep 2011 11:48:49 GMT

Last week I attended the Sales and Operations Planning Summit in Boston. Attendance was impressive with more than 150 operations, supply chain, manufacturing and finance professionals from a wide range of industries. The conference's two-day, one track format was very popular, serving both companies who are relatively new to sales and operations planning (S&OP)

VMI Today

Thu, 25 Aug 2011 10:32:03 GMT

I can remember the industry abuzz about VMI 10 years ago. Then, it just faded away. The reasons for its fade were quite simple. VMI was widely hyped to dramatically reduce inventories, cut costs and improve efficiency across the supply chain. While it did accomplish these goals some of the time, its key hurdle ...

Multi-Echelon Inventory Optimization Gets Cool

Fri, 12 Aug 2011 14:26:32 GMT

We’ve been in the Multi-Echelon Inventory Optimization (MEIO) business for more than 10 years helping companies such as Procter & Gamble, HP and Stanley Black & Decker gain competitive value through reduced inventory...

The Efficient Frontier Awaits

Thu, 14 Jul 2011 09:20:52 GMT

Whenever you set a goal, your natural inclination is to achieve it; swipe a line through it, and be done. Supply chain management is full of goals such as mounting pressure from the top to get costs down quickly. We tend to grab this bull by the horns with the intent of showing demonstrable results. But, sometimes grabbing the bull may be short-sighted, and to really achieve the goal we might need to first step back.

Innovation’s Impact on the High-Tech Industry

Wed, 25 May 2011 14:43:41 GMT

Just the other week I met with one of our consumer high-tech customers who spoke about the impact of the pace of innovation on their industry. He mentioned how the supply chain organization, particularly aftermarket parts, has changed and how they have had to evolve their forecasting and inventory management practices.

Getting Cloudy?

Wed, 20 Apr 2011 11:19:22 GMT

A recent report, “IT Survey on Cloud Computing, Virtualization, and IT Financial Services," provides new insight into how CIOs and other IT decision-makers at large enterprise organizations are evaluating and implementing cloud technologies, with a focus on the specific financial metrics they use to rationalize their investment.

Connections 2011: Day 1

Wed, 23 Mar 2011 13:16:55 GMT

We are just wrapping up a great first day here in Orlando. It is amazing to see so many customers in one place. Attendance was up nearly 40%. The level of interest highlights the importance of supply chain in the success of a company.

Connections 2011: A Preview

Tue, 15 Mar 2011 13:02:15 GMT

We are officially one week away from the kickoff of Connections 2011, our annual customer conference. Attendance is up more than 40%. And, we have added 25% more sessions. The conference is designed to help attendees navigate their voyage to supply chain success, starting in sunny Orlando.

Three Steps to a Better Supply Chain

Wed, 09 Mar 2011 09:43:23 GMT

Yes, a better supply chain is just three steps away. And, no, I am not going to try to sell you a companion book for $29.95 plus shipping and handling. It is no secret there is increasing pressure from customers, competitors, internal management, and others to create additional efficiency throughout the supply chain. After speaking with

Seeing Around the Corner

Wed, 02 Mar 2011 11:32:01 GMT

Wouldn’t it be great if we could see around the corner, to posses that magical ability to anticipate what’s at the next intersection? On the road, we now have cars that can see around a corner, let you know what is ahead and prepare for any changes in conditions. You, the driver, are no longer

The Politics of S&OP

Wed, 23 Feb 2011 16:17:18 GMT

Recently I conducted an interview with an industry analyst who asked about the evolution from Sales and Operations Planning (S&OP) to Integrated Business Planning (IBP) and how the two are distinguished. Did I hear that correctly? I had to pause for a moment. Integrated Business Planning is not an evolution of Sales and Operations Planning. [...]

S&OP: An Interview with Nari Viswanathan, Aberdeen Group

Wed, 16 Feb 2011 16:23:30 GMT

In case you missed it, I recently spoke with Aberdeen Group’s Nari Viswanathan about the change in S&OP strategy. Here is some of what we discussed. Best-in-class companies clearly differentiate themselves through the use of S&OP The strategic shift is not only in response to the economic upheaval of the last 24+ months but also [...]

The Changing Face of Vendor Managed Inventory

Wed, 09 Feb 2011 11:51:34 GMT

VMI is back. While many have spoken of its demise, lately I have found myself engaged with customers, press and analysts about its resurgence. I also have an article set to appear in the Journal of Business Forecasting as well as a whitepaper on the topic, What You Need to Know About the New Collaborative

Escaping the Cold

Wed, 02 Feb 2011 10:42:00 GMT

The weather, even here in Atlanta, has been crazy and the thought of Spring and its warmer temperatures makes me long for my childhood home in South Florida. Just the other week we saw upwards of 7 inches of snow here, which closed the city for four days! Many of you have dealt with several

A Few good SKUs

Tue, 16 Nov 2010 11:54:36 GMT

Walmart Wammy Teaches a Lesson in SKU Rationalization To rationalize or not to rationalize: that is the question. According to CFO.com, Walmart thought it had the right answer by cutting back “vast numbers of underperforming stock-keeping units” in 2009. In the stores, customers saw a narrower range of products and more private-label products, so…they shopped

So You think You Can Replenish?

Wed, 03 Nov 2010 11:57:10 GMT

How to excel at the Replenishment Shuffle One of the most profitable moves a supply chain team can make is optimizing replenishment in a multi-tiered distribution network (manufacturer to DC, DC to Retailer, etc.). I have found many companies miss the boat with a single-echelon approach that simply replenishes the warehouse or the DC separately. [...]

The Inventory Optimization Spreadsheet Gap

Thu, 28 Oct 2010 12:37:49 GMT

Consumer Goods companies appear to be “tool-challenged” when it comes to inventory optimization (IO). At least that is what they think based on a recent survey conducted by Consumer Goods Technology, “Inventory Optimization—Delivering more than just Inventory Reduction.” Four statistics pulled from this report deliver a clear message regarding the industry’s need for better inventory

A Q&A with Stanley Black & Decker and Boston University on Inventory Optimization

Tue, 26 Oct 2010 10:47:48 GMT

Inventory optimization (IO) has become an increasingly important topic of late as companies try to balance inventory (amount, location, etc.) with erratic demand and supply variability. Following the inventory slashing practices during the global financial crisis, many were left unable to respond quickly and cost-effectively to a rise in demand, leaving these companies at a

Network Design and MEIO: the Next Buddy Movie?

Wed, 22 Sep 2010 11:18:24 GMT

Ruggedly independent, yes, but they know they can rely on each other, too. Butch Cassidy was all brains and vision, while Sundance had good looks and the fast draw. Luke was innocent and highly intuitive, while Han was rakish and resourceful. The classic buddy movie is based on a perfect synergy of two very distinct

Collaboration – Are we there yet?

Wed, 15 Sep 2010 12:00:27 GMT

For more than a decade, the idea of a close working relationship between trading partners has been one of the Holy Grails of the supply chain. Information moving seamlessly…everyone knows what the other is doing…bottlenecks removed…a Utopia of sorts. But, are we there yet? IndustryWeek recently highlighted a new book, The New Supply Chain Agenda

Going Lean? Don’t Leave Money on the Table

Wed, 08 Sep 2010 12:04:46 GMT

The prophets of lean manufacturing methods usually scorn planning systems. ERP and Advanced Planning Systems (APS) systems stochastically propagate a combination of hard demand and forecasts through the supply chain. Demand signals are ignored and individual inventory buffers are based on lead times and lot size requirements throughout the supply chain. Often, this leads to

Reflective Thinking: Complexity

Wed, 01 Sep 2010 11:25:21 GMT

com-plex-i-ty [kuhm-plek-si-tee] -noun, the state or quality of being complex; intricacy Source: Dictionary.com As today’s networks grow and interaction with partners across the world becomes the norm, it is your ability to identify complexity and then develop a strategy to manage it that can make or break your competitiveness. Managing complexity is almost like looking

Expert Interview: Inventory Optimization

Wed, 25 Aug 2010 13:18:15 GMT

Inventory Optimization (IO) is a loosely used term in the industry. You’ll see it used to describe tactical inventory management, warehouse operations and strategic network assessments as well as used to describe single stage as well as multi-echelon environments. Inventory optimization is so much more and impacts the supply chain at all levels. Recently

S&OP: Are You Prepared?

Tue, 17 Aug 2010 12:08:57 GMT

Sales and operations planning (S&OP) is a process designed to unite all key constituents across the enterprise to a single goal. Senior level executives responsible for sales, marketing, materials/procurement, manufacturing, transportation, supply chain, and finance (to name a few) meet to consider the needs and constraints of each of their respective areas in light of