Insights from Ryder Innovate 2014

Talking Logistics

Source: “Sustainability and Green Initiatives in Transportation & Logistics,” Jason Mathers, EDF, Ryder Innovate 2014. Inventory (inventory management policies and practices, optimizing inventory flow). Source: “Advances & Best Practices in Supply Chain Design,” Toby Brzoznowski, LLamasoft, Ryder Innovate 2014. The post Insights from Ryder Innovate 2014 appeared first on Talking Logistics with Adrian Gonzalez.

This Week in Logistics News (August 4-8, 2014)

Talking Logistics

The bodega and building as it appears today (source: Google Maps). HighJump Software announced enhancements to its Retail Inventory and Point of Sale Management software, RETAIL vantage. The post This Week in Logistics News (August 4-8, 2014) appeared first on Talking Logistics with Adrian Gonzalez. At the top of my family tree, the one planted here after my parents arrived from Cuba, youll find a small bodega nestled in the branches.

Your supply chain is costing you money – Reason #6 Not effectively managing inventory.

Kinaxis

Reason #6 Not effectively managing inventory. Unfortunately, all the same kinds of things can happen to your supply chain inventory. Except that your inventory costs millions of dollars. Those of you that manage inventories know how hard it can be to get the quantities just right. If you maintain too little inventory, you have stockouts, line stoppages and unhappy customers. So what strategies are out there to maintain inventories at the “right” level?

10 Commandments of Inventory Management

Supply Chain Opz

Inventory management is one of the most important tasks for supply chain management professionals. However, most inventory control theories are too complicated or too difficult to apply to real world situations. Then, this article will show you 10 simple principles that you can use to streamline your inventory management practices right away. 3) Forecast at the right level Standard inventory management textbooks suggested that forecast be done at a product family level.

Can Your Inventory Control System Support Seasonal Demand?

LeanCor

How can companies calculate the right inventory quantity and send it to the right place at the right time with such seasonality involved? Don’t be fooled by the scary mask – it is possible through rigorous supply chain planning, a sufficient inbound and outbound logistics network, and a supporting inventory control system. Here are 3 tips to help you develop an inventory control system based on flow to the customer: 1. Where will you keep the inventory?

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Getting Down to Brass Tacks: Can We Really Collaborate?

Supply Chain Shaman

Source Wikipedia. Current State of Perpetual Inventory. Replenishment is fueled by an effective perpetual inventory signal. Without a perpetual inventory signal, you will never be able to manage out-of-stocks and promot ions. Today, as shown in figure 2, 57% of retailers have a perpetual inventory signal in the warehouse and 47% have a perpetual inventory signal in the store. Collaborative relationships need a good signal for inventory.

Your supply chain is costing you money – Reason #7 Making decisions based on bad data (supply chain data accuracy)

Kinaxis

Reason #6 Not effectively managing inventory. Having wasted time going to that store, I’d be less inclined to use that store in the future – at least I’d be much less likely to trust their website’s inventory. If the planned lead-time is longer than actual, you get excess inventories. Finally, inaccurate cost information may cause you to make incorrect sourcing decisions. On Hand Inventory quantity/status. by John Westerveld.

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Let the Qs Begin

Supply Chain Shaman

While the performance rankings were based on comparisons of inventory turns, operating margin and Return on Invested Capital (ROIC) for the periods of 2006-2013 and 2009-2013, the concept is that to be a supply chain leader you must outperform and drive improvement. To ensure the management of the complex system, the metrics of operating margin, inventory turns, ROIC, customer service, revenue, and forecast accuracy need to be managed together as a non-linear system.

Your supply chain is costing you money – Reason #5 Not having a supply chain risk management process

Kinaxis

If your demand decreases, you have excess inventory or idle capacity. Mitigating Risk – inventory tracking and dual sourcing are considered to be the most effective risk mitigation strategies. Inventory management Sales and operations planning (S&OP) Supply chain management Supply chain risk management Computer security IBM Japan Manufacturing Risk management Sales and operations planning Supply chain

Q&A on the Supply Chains to Admire

Supply Chain Shaman

Here we share the answers to the questions that we get the most often about this research: What is the source of data? We placed them in the industry that they were the most like, e.g., the primary source of revenue. Nineteen of the 200 companies met the performance criteria of improving operating margin, inventory turns, and ROIC together in concert for the years of 2006-2013 or 2009-2013. There are a lot of misconceptions about inventory.

Misnomer

Supply Chain Shaman

The team was organized around the functional silos of source, make and deliver. I also believed that this company would have the best inventory and customer service. Instead, we found that the companies with the lowest total supply chain cost (a total of source, make and deliver) had average costs in manufacturing and distribution. Today, 60% of sourcing organizations and 45% of manufacturing organizations report through the supply chain organization.”

Throwing Down the Gauntlet

Supply Chain Shaman

In Figure 1, I share a composite orbit chart of progress of Cisco Systems, Intel, Samsung and Flextronics on the Effective Frontier at the intersection of inventory turns and operating margin for 2006-2012. However, no company in this chart is on a linear path towards improving both margin and inventory turns. This is the clear articulation of when and how to make, source, and deliver for the community.

Steel Fabrication and General Manufacturing Tips and Tricks for 2015

Cerasis

Still in all most fabricators have seen steel sales rise and customer demands and inventory requirements increase over the past several years. The source pointed to several trends that are encouraging the adoption of TMS, including better control of data, more comprehensive analysis and the need to support omni-channel supply chains.

“Storage Wars” Rescues Supply Chain Ignominy

Kinaxis

The end to end network required real time technology, from a single data source that could “ know sooner and act faster ”. Inventory management Supply chain management AMR Research Boston Craigslist Do it yourself Enterprise resource planning (ERP) ERP Garage Toolbox by CJ Wehlage. Take a good long look at this picture. That’s my ignominy. That’s my garage.

26 Best Practices in Lean Warehousing

LeanCor

Warehouse strategy is driven by inventory strategy. Quality at the Source. Many people may think the term “lean warehousing” is an oxymoron. Let’s face it, most lean purists believe that all transportation and warehousing functions are pure waste. Many organizations see logistics functions as a way to gain competitive advantage and bring value to the customer.

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Dreaming of Clouds, Lakes and Streams

Supply Chain Shaman

Nine out of ten companies are not making progress at the intersection of inventory turns and operating margins. The second company reads market data through syndicated sources. Join us in our research study on Big Data and join us at our Global Summit in Scottsdale, AZ on September 10-11, 2014. It is morning in Chicago. I crave coffee. The sun shines brightly out the window, but the noisy city is quiet.

Reflections on Hard Hats and Safety Shoes…

Supply Chain Shaman

As I work with teams to envision the new tomorrow, I find fewer people know the basic concepts of manufacturing planning–cycle inventories, freeze duration, slush period, bottlenecks and constraints. And, the service supply chain can be redesigned to have less inventory and more uptime. The time to service the equipment would be in hours versus days and the amount of inventory to provide the service would be greatly reduced.

The Next Great Disruption Coming to Supply Chains

Kinaxis

I watched a TED Talk video by Philip Evans, from Boston Consulting Group and shuddered to think that all our traditional fulfillment and inventory models can be drastically transformed by the “consumer”. Sure, we’re concerned, and in some cases stocking more inventory at local distribution centers. Then, they go to the retail store, scan the barcode to check inventory, price, and promotions in their 10 mile radius.

Time for a Mea Culpa?

Supply Chain Shaman

On the 2nd of April, I sat before a board discussing how a company could exceed expectations in the delivery of Return on Invested Capital (ROIC) and superior operating margins and fail at the delivery of customer service and inventory. Because he had reduced his buffers—both inventory and manufacturing—and had built a push-based supply chain using a forecasted demand signal, he was failing in many markets. An Orbit Chart of Customer Service (Case Fill) Versus Inventory Turns.

Use these management strategies to build a great supply chain…

The Network Effect

To leverage cross functional measurement improvements, perhaps pull together a chat session to discuss inventory positions and show the various departments the effects their decisions are having on quarterly cash flows and customer service levels, without becoming negative and turning the conversation adversarial based on the usual “lack of visibility” issues.

Experts Discuss How to Streamline Global Supply Chain

Supply Chain Opz

Whether you''re a manufacturing company in China, a sourcing agent in London or a world''s leading company in Silicon Valley, we''re all in a global supply chain networks. Reducing lead times from suppliers can help turn inventory faster, freeing up cash and ultimately satisfying customers. This increases flexibility and translates into less overall inventory since it is not in the wrong place.

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Expert Explains How to Improve Supply Chain Efficiency

Supply Chain Opz

By reducing lead times due to shorter delivery routes, inventory and waste in the system can be reduced without sacrificing service levels. Better detection of demand trends, and active control of demand variation by promotions and advertising bears the potential to curb variability at its source. Adulterated baby formulas, pet foods, medications or toys can be hugely costly to companies, while their sources can be difficult to trace.

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Your supply chain is costing you money – Reason #10 Failure to adequately train your supply chain planning staff

Kinaxis

Reason #6 Not effectively managing inventory. A bad decision can result in missed orders, significant inventory, or scrapped materials. They do their jobs moving inventory from here to there, opening orders that the system says should be opened, cancelling orders that the system says should be cancelled, yet never questioning why or whether it makes sense. By doing this, they could potentially save the company millions of dollars in excess inventory.

Why the supply chain should be more social

The Network Effect

Or a personal health situation arises like a batch of peanut butter becoming contaminated with salmonella or children’s toys being contaminated with lead paint, where the regulators have difficulty identifying the source of the problem several tiers upstream in the supply chain. It is increasingly common to find that the company whose brand name is on a product never actually takes inventory of the item before it is sold to a customer.

Supply Chain Planning

LeanCor

When a dealership opens its doors, it knows inventory will be more tightly controlled on the corporate level than its competition. The manufacturer needs to make sure it has enough finished goods inventory to act as a buffer in order to level its flow, or, increase outbound shipments. Additionally, quality at the source and error-proofing are necessary in effective process development. Balancing the People, Processes, and Purpose of Supply Chain Planning.

Noob Guide to Supply Chain Management Definition

Supply Chain Opz

Real world example is that a "new boss" ask you to cut cost by 10%, improve service level by 15%, double inventory turns and so on. Focus your time and energy to create long-term relationship with suppliers of key products and items with limited source of supply because these are people who can make or break your supply chain. What is the definition of supply chain management? Despite the popularity of this concept, there are considerable confusions among the practitioners.

Why “Distributed Order Management” is a top retail trend and why you should care

The Network Effect

The best way to achieve this is to provide a single, global view of all inventory available in order to intelligently source the line item components of that order, ensuring that the business can meet both current and future customer demand while optimizing inventory, logistics, and asset utilization. This of course limits inventory visibility as well as the options companies have in fulfilling their items.

The Science of Sustainable Supply Chains (Guest Post by Dara O’Rourke, UC Berkeley)

SCM Research

However, the speed and dynamism of modern supply chains creates challenges for incorporating sustainability data into sourcing decisions. 2014). My guest post today comes from Dara O’Rourke. In his recent Science article, The Science of Sustainable Supply Chains, Dara argues that the field of supply chain management needs to significantly improve and integrate sustainability measurement systems and decision-support tools.

Elephant in the Room: Thoughts on Metrics That Matter in Semiconductor and Hard Disk Drives

Kinaxis

With China already a source for semiconductor raw materials and the China/India end consumer market growing, there will be pressure to supply chips and hard drives to local China/India OEM’s first. Understanding inventory planning will take on a new dynamic. On the downside, it appears that these industries are struggling with inventory issues. The research shows the cash-to-cash cycle has increased, as have days of inventory, and inventory turns are on the decline.

All Signs Point to Mexico Playing a Greater Role in Supply Chains

Talking Logistics

The recently-published 2015 Third Party Logistics Study includes a special section on Mexico, and 40 percent of the study respondents said “they have already moved some of their operations to Mexico, citing reduced freight transportation time and closer proximity to sources as the most important factors as the primary drivers of the change.” They also saw inventory cost reductions of 12% compared to 9% globally and order fill rates move to 77% from 68%.

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What the Analysts Are Saying About…A&D Supply Chains

Kinaxis

Think about those design, sourcing and delivery challenges. A supply chain based so heavily on external sources is susceptible to more risk than catching a flight on time out of Newark. Interestingly, to help address the issue of ensuring materials are available when needed; the research indicates that A&D companies have “developed some of the most advanced sourcing techniques and practices.” by Bill DuBois.

Healthcare Logistics

LeanCor

The large number of distribution centers caused difficulty in providing good SKU coverage without creating inventory bloat. LeanCor used total cost models, Greenfield analysis, and inventory frequency analysis. Improved service levels with overall inventory reduction. The future state model not only yielded a network with higher inventory turns and lower cost per cube in transportation, but also a favorable shipment schedule for the supply base.

How the cloud and counterfeiting are affecting the pharmaceutical supply chain

The Network Effect

These capabilities can also work to reduce inventory by providing data on inventory from downstream supply chain partners, which can be leveraged to model demand and regulate drug supply. Producers of both innovative products and generics are being confronted with a growing number of counterfeits which are deliberately and fraudulently mislabeled with respect to identity and/or source.

How to boost relationships between shippers and 3PLs

DELMIA Quintiq

The manufacturer would benefit from lower inventory levels, while the 3PL operator could gain a better profit margin for being responsive and reacting “on demand”. To share a great success story: One of our customers from the metals industry who used our planning and optimization software was able to reduce inventory of raw materials by 35%, reflecting savings of double-digit millions.

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Push vs. Pull in your supply chain…what’s the difference?

The Network Effect

They also lead to other problems like high carrying costs, discounting, disposals, missed sales, weak customer loyalty, shortages, high debt loads, inventory disposals, emergency shipments, rescheduled production and attenuated profits. Only immediate customer requirements are drawn from the protective inventories upstream. The result is an automated inventory policy driven by actual pull requirements at the granular level. Loren Kerns (Flickr).