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Gaining Clarity on Inventory Effectiveness

Supply Chain Shaman

The impact of complexity on inventory is not quick. To help, today I want to share some of the insights from our recent Inventory Optimization study. Inventory management is a hot issue. Companies invest in project after project, yet inventory levels remain the same. In business there are many drivers of inventory, and the management of inventory levels requires discipline and a cross-functional focus. What Drives Inventory Effectiveness?

Supply Chain Metrics - Gaining Visibility in a Data-rich World

Logility

The second part of Drucker’s quote, “if you can't measure it, you can't improve it,” really brings home the importance of having the right set of metrics. In the field of supply chain management, we have created an abundance of metrics and key performance indicators (KPIs). For the past 30 years I have been involved with multiple efforts to build a set of supply chain metrics and have learned a few things along the way.

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Building a Triple A Supply Chain: Ten Tactics That Work

Supply Chain Shaman

Over the last six years, we studied the connection between business results (growth, operating margin, inventory turns and Return on Invested Capital (ROIC)) and the link to company characteristics. The technology group wanted to implement SAP IBP, and the business leaders were resistant.

Which Metrics Matter? Interview with Philippe Lambotte

Supply Chain Shaman

My journey to understand supply chain Metrics That Matter started three years ago. When I sat down to write the book, Bricks Matter, I believed that companies had used supply chain technologies to reduce operating margin and improve inventory turns. We are currently mapping the progress of all public manufacturing, distribution and retail companies on three factors: Strength: Year-over-year improvement on operating margin and inventory turns for the past six years.

Looking Beyond Red Arrows

Supply Chain Shaman

It is hard work to maintain the status quo in metrics performance. A balanced portfolio of metrics delivers the greatest value. As a result, supply chain leaders focus on unrealistic goals of inventory or costs, they will throw the system out of balance. However, the stories of success are largely project improvements or improvements in vertical supply chain efficiency in manufacturing or transportation. Then identify, if the peer group is making progress.

What’s the ROI Of Transport and Logistics Providers & A TMS?

Cerasis

Much talk about sales, automation and improved processes dominate the conversation when considering outsourcing logistics processes to a transport and logistics providers or using a 3PL-based transportation management system (TMS). Often, the transport and logistics providers' reps claim initial returns may be as high as 25 percent, if not greater. There are many benefits that accompany the use of transport and logistics providers and their TMS systems.

Wanted: Supply Chain Architects!

Supply Chain Shaman

I knew nothing about the world of logistics, inventory management and order optimization. Warehouse Management and Transportation Management were in their infancy. The focus in supply chain groups was not on how to design the operations so that they were more effective; instead it was about the use of best practices to maximize the value of what we had. It should not be functional, with a narrow focus on a singular function like manufacturing or transportation.

Control Towers: If Only There Was A Clear Definition

Supply Chain Shaman

Groups throw-out concepts. While there are many types of visibility (see Figure 1), the most common use case is either sourcing or transportation visibility. The focus is on functional metrics, but are unable to get to overall supply chain metrics. For example, only 29% of manufacturing companies can access total cost data and 31% struggle to see the impact of business decisions on inventory. Groups rally around the concept of real-time.

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Manufacturing Gains From Machine Learning

IQMS

Asset Management, Supply Chain Management, and Inventory Management are the hottest areas of artificial intelligence, machine learning and IoT adoption in manufacturing today. Kearney’s recent study of the future of production find that manufacturers are evaluating how combining emerging technologies including IoT, AI, and machine learning can improve asset tracking accuracy, supply chain visibility, and inventory optimization. PDF, no opt-in) 2017 Honeywell User’s Group.

Supply Chain KPIs You’ll Want Every Morning

Logility

in inventory write-down and 20% drop in stock value. Every company today runs on data – the key to using your data is choosing the right metrics for visibility into your supply chain. Warehousing and transportation costs. Metrics.

What Omnichannel Supply Chain Analytics Should I Know?

Veridian Solutions

Supply chain leaders need to understand the challenges of applying omnichannel analytics, how they enable insight across supply chain functions, such as order fulfillment and inventory management, and how to apply them to achieve the greatest result. As an example, consider analytics covering insights in transportation management. However, transportation management involves hundreds of individual processes. A Guide to the Warehouse Metrics Supply Chain Execs Should Track.

6 Benefits of Applying Useable Data in Logistics For Continuous Improvement

Cerasis

We continue our series on strategic shipping by going into detail of the 10 main areas that shippers can turn to in order to have a strategic logistics and transportation management mindset. Today we will go into detail on using the available data created in the processing of shipments within transportation management and other related logistics management for continuous improvement. . Metrics and KPIs.

This Week in Logistics News (March 4-8, 2019)

Talking Logistics

Back in July 2017, I interviewed Bennett Adelson, the former CEO of MacroPoint (which was later acquired by Descartes Systems Group, a Talking Logistics sponsor) about OTIF and how it is driving demand for visibility solutions. More stringent customer delivery requirements is certainly one factor, with On-Time In-Full (OTIF) becoming a more critical metric. Simply put, OTIF spells OPPORTUNITY for transportation technology providers.

What is the FMSCA’s Unified Registration System (URS) And What is the Impact on Transportation & Logistics Management?

Cerasis

Effective transportation management can be a hassle. Transportation managers must keep up with the ship dates of inventory, where inventory is currently located in the transportation process, what insurance information is being used and appropriated for each shipment, and many more factors. Let's take a look at what this rule does, why it’s going into a fact, how it will affect the existing fleets, and its implications for the future of transportation.

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This Week in Logistics News (May 13-17, 2013)

Talking Logistics

Chainalytics Creates New Metrics for Demand Planning Consortium. Descartes’ GLN, route planning and transportation management solutions and deep domain expertise can help our retail, distribution and manufacturing customers in managing their global and local inbound logistics and delivery operations.”. . This Week in News Chainalytics cloud computing container shipping Descartes Systems Group HighJump Software Maersk NetSuite UPS

BASF: A Story of a Supply Chain Leader

Supply Chain Shaman

He is an industrial engineer with a diploma in transportation and logistics from the University of Applied Sciences in Bremerhaven. Over the period of 2009-2015 only 88% of companies made improvement on the “Supply Chain Metrics That Matter.” (The The Supply Chain Metrics That Matter are a portfolio of metrics which correlate to higher market capitalization. The composite of metrics includes growth, operating margin, inventory turns and Return on Invested Capital.)

The 5 Benefits of Hybrid SaaS TMS

Cerasis

New, innovative technology platforms have greatly sped the expansion and evolution of transportation as well as logistic solutions. The transportation management system, or often referred to as TMS, is a great example of how this technology is being used to create a more interconnected space both digitally and physically. The transportation feature functionalities can be compared to what many recognize as on premise solutions. Technology TMS Transportation

Tell Me Why

Supply Chain Shaman

Amazon’s because of their breath in physical and digital supply chain, innovation in material handling, transportation, etc and their vision completely disrupting the industry. As a result, tor most companies, the goals are unclear and the financial metrics are not well-understood. It is a study of peer groups. They do not have a peer group for comparison. We do not include them in the analysis because there is no peer group comparison.

How Machine Learning Is Redefining Supply Chain Management

IQMS

Key factors influencing inventory levels, supplier quality, demand forecasting, procure-to-pay, order-to-cash, production planning, transportation management and more are becoming known for the first time. Source: Machine Learning & AI in Transport and Logistics, Frank Salliau & Sven Verstrepen Logistics Meets Innovation Vlerick Brussels – Nov. The Hackett Group, Analytics: Laying the Foundation for Supply Chain Digital Transformation (PDF, 10 pp.,

Integrated Planning: Is It Rubbish? Be Careful What You Ask For….

Supply Chain Shaman

I find most companies are good at pockets of planning–demand planning, supply planning, transportation planning, material planning or plant scheduling, but the flows are not connected. Each are good at localized planning within a focused area of demand, supply, network design, transportation planning, material sourcing or finite scheduling. Few implementations of planning connect to procurement and transportation.

2020 Requires Big Wings and Feet

Supply Chain Shaman

The discussions are with groups of executives—often ex-management consultants. Granular data by volume is a must to be able to manage replenishment, network design, and inventory targets. Companies that directly connect financial data to supply chain data without creating a feasible plan at an item/location level rate themselves significantly lower on S&OP effectiveness creating higher costs, levels of inventory and order short shipments. It has been awhile.

Business Strategies to Recover After the Coronavirus

Vinculum

Is your organization facing a shortage of essential supplies and inventory prompted by panic buying and stocking up of consumers? The post Business Strategies to Recover After the Coronavirus appeared first on Vinculum Group.

Top 5 Roadblocks to Effective Inbound Logistics Management

Cerasis

A Peerless Research Group (PRG) report indicated that up to 44 percent of supply chain entities do not actively have plans in pursuing or using a transportation management system (TMS), such as the Cerasis Rater. Approximately 54 percent of companies actively run metrics on inbound freight, but these metrics may be lacking. In other words, the term, “metrics,” can be deceiving. Inventory levels may soar or fail to meet customer demand, and profits become losses.

Why Segmentation and Profitability Go Hand in Hand

Supply Chain Nation

The conference format and size were just right to allow comfortable sharing of ideas and lessons learned about various topics from S&OP and supply chain planning, to inventory optimization and transportation. It was the general consensus of the group that there is value to be delivered from supply chain segmentation. It is critical to align the whole organization on the right metrics, otherwise the segmentation will fall apart.

Sorry, I’m Not Sure: Supply Chain and Logistics Predictions for 2018

Talking Logistics

If they actually follow through on their promise and oil prices continue to rise next year, how will transportation, inventory, and sourcing policy decisions change in response? And since so many aspects of supply chain management affect both customer experience and financial metrics, supply chain innovation efforts need to take these factors into consideration too. Kenco Group (a Talking Logistics sponsor) is a great example. Source: Evan, Flikr. “I

Taking the Hill

Supply Chain Shaman

This week, at Supply Chain Insights LLC, we published our 11th report in the series titled Supply Chain Metrics That Matter. Financial ratios allow us to analyze performance across the peer group (large against small companies) and across currencies. We also look for companies that have out-performed their peer groups. When companies look at singular metrics (labor costs or inventory), they have moved backwards. Aligning metrics matters.

How Supply Chain Will be Affected by Hurricane Harvey

Material Handling & Logistics

The Institute for Supply Management conducted a special survey that asked members to assess how Harvey might impact six key business metrics and whether they may be impacted by shortages of input materials due to Harvey. "Our The manufacturing PMI and non-manufacturing NMI summarize supply managers’ reports as to how their organizations fared in the past month with regard to a set of key business metrics. Employment was the only metric in the third group of least impacted metrics.

New Bookends: The Tale of Supply Chain Global Leaders in Consumer Products

Supply Chain Shaman

In Figure 1, performance better than average for the peer group is highlighted in light green. Overall Results on the Supply Chain Metrics That Matter. Overall, in the industry, there is more forward momentum in consumer products sector than the food/beverage peer groups. These giants drove slight improvements in operating margin, inventory turns and Return on Invested Capital (ROIC) despite a slowing economy. They cannot be grouped together. Definition.

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Reflections on Integrated Supply Chain Planning

Supply Chain Shaman

This is unlike many studies that are fielded to B2B panel groups where the identity of the respondents cannot be ascertained.). The SAP and Oracle analyst relations groups are big machines. This week, I am finishing two reports: Sales and Operations Planning, and Inventory Optimization. However, when you ask each group for a definition of “integrated” the definitions are different. Here are the links to the studies: Inventory Management.

Misnomer

Supply Chain Shaman

It was my first time working with this group. The group laughed. ” The group was quiet as we discussed the fact in the traditional organization that functional silos are not designed to work together. I believed that we would find a company with the lowest distribution costs (warehousing and transportation), and the lowest manufacturing costs, and this would result in the best overall cost structure. Misnomer (n): A wrong name. The misuse of a term or name.

How Can We Heal the Global Supply Chain?

Supply Chain Shaman

The combination of technology along with the advancements in transportation made it possible. The winners drive improvement while posting financial results in the Supply Chain Metrics That Matter ahead of the peer group. In the analysis, we study 33 industry peer groups across more than three hundred public companies. Greater margin performance than the industry average for the peer group for the period of 2006-2015. Inventory Turns.

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Let the Qs Begin

Supply Chain Shaman

This report, Supply Chains to Admire , compares the progress of 200 companies within their respective peer groups on both performance and improvement. 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. Aligned Metrics.

Unilever and Colgate: Two Bookends?

Supply Chain Shaman

One story that stands out for me is the race for supply chain excellence within the CPG peer group. Overall, as shown in table 1, the CPG group composed of Church & Dwight, Clorox, Colgate, Kimberly Clark, Procter & Gamble, Reckitt Benckiser and Unilever, is facing slower growth. If the definition is the balancing of costs and inventory, the winner is Colgate. When I compare these two companies to their peer group, I see two bookends.

Demand-Driven Transformation at Shell

Supply Chain Shaman

Completed in 2012, the ERP project forced the company to standardize organizational design, roles, and metrics. They saw a steady drop in inventory and reduced working capital by about 50% over the period of 2011-2015. Impact of Demand Sensing on Inventory Levels. Over this period of 2013-2014 Shell made good progress on inventory, but faced unprecedented supply price volatility. Nick formed a broad cross-functional coalition and empowered the group to drive change.

[WHITE PAPER] 4 Strategic Considerations when Considering Offshoring Parts of your Supply Chain

Cerasis

While they may save money on unskilled labor and by achieving economies of scale, they ultimately will pay more because of longer lead times, increased inventories, the need for more management resources for planning and logistics, and constraints on their ability to respond quickly to changing demand. In this new white paper from The Rodon Group, they’ll examine three strategic areas to include in your supplier selection process: Cost, Scheduling, and Compliance.