Global Supply Chain Solutions Covering Procurement, Risk, the IoT and More
JUNE 2020
EMERGING TECHNOLOGIES
How automation, robotics and software solutions keep product moving.
2020
MENTORSHIP IN THE SUPPLY CHAIN
How to invest in your existing workforce.
RESILIENT
SUPPLY CHAINS
This year’s SDCE 100 projects deliver innovation, maximum efficiency and improved operations within the supply chain.
Fresh new content daily at www.SDCEXEC.COM
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19th Annual
2020
1 0 0 G R E AT SUPPLY CHAIN PROJECTS This year’s Supply & Demand Chain Executive SDCE 100 highlights supply chain solution and service providers working with small, medium and large enterprises to transform their supply chains and deliver value to the bottom line. These leaders help their customers meet the challenges of the New Normal, while laying the framework for successful supply chain transformation.
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Global Supply Chain Solutions Covering Procurement, Risk, the IoT and More
JUNE 2020
EMERGING TECHNOLOGIES
How automation, robotics and software solutions keep product moving.
2020
MENTORSHIP IN THE SUPPLY CHAIN
How to invest in your existing workforce.
RESILIENT
SUPPLY CHAINS
This year’s SDCE 100 projects deliver innovation, maximum efficiency and improved operations within the supply chain.
Fresh new content daily at www.SDCEXEC.COM
SDC0620_01_Cover.indd 1
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We’re engineering your competitive edge. B A S T I A N S O L U T I O N S , A T O Y O T A A D V A N C E D L O G I S T I C S C O M P A N Y, I S A T R U S T E D S U P P LY C H A I N I N T E G R A T I O N P A R T N E R C O M M I T T E D T O P R O V I D I N G C L I E N T S A C O M P E T I T I V E A D VA N TA G E B Y DESIGNING AND DELIVERING WORLD-CLASS DISTRIBUTION AND PRODUCTION SOLUTIONS.
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June 2020 | Volume 21 | Issue 2
CONTENTS XX
FEATURES
SPECIAL REPORTS
08
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COVER STORY A Smart Supply Chain is an Efficient One
Discover how emerging technologies help streamline businesses.
08 14
AWARD SDCE 100
Here’s how innovation and improved operations transform today’s supply chains for tomorrow.
EMERGING TECHNOLOGIES How Automation Helps Supply Chains Manage Productivity to Sustain E-Commerce Growth
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Honeywell suggests companies partner with an experienced provider of sortation technologies.
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PROCUREMENT The Empowered Role of Procurement in a New Reality
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SAP Procurement Solutions says businesses need to be able to shift at a moment’s notice.
EXECUTIVE FOCUS
28
2020
TRANSPORTATION Three Ways 3PLs Can Address Transportation Challenges DHL unveils services 3PLs provide to meet transportation needs.
SOFTWARE & TECH Predictive Modeling for Transportation Fleet Executives Fleet Advantage unveils how transportation fleets leverage advanced business intelligence.
SOFTWARE & TECH Supply Chain Analytics Planning for Pandemic Recovery
COLUMNS
04 06
37
SDCEXEC.COM
Biggins Lacy Shapiro & Co. discuss how to approach site selection of a U.S. facility.
Logistyx Technologies shares how prescriptive analytics helps guide decision-making.
22
16
WAREHOUSING ‘Reshoring’ in the Age of a Global Pandemic
EXECUTIVE MEMO CHAIN REACTIONS MADE IN AMERICA WORK HARD, PLAY HARD
Exclusive online features and solutions for successful supply chain operations
Supply & Demand Chain Executive Celebrates 20-Year Anniversary
www.sdcexec.com/20-year-anniversary
Learn. Innovate. News. Supply & Demand Chain Knowledge. The L.I.N.K. to Executive Launches Supply Global Supply Chain Intelligence Chain Network Virtual Summit www.sdcexec.com/podcast
www.sdcexec.com/scn-summit
www.SDCExec.com | June 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE
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EXECUTIVE MEMO By Marina Mayer Editor-in-Chief mmayer@ACBusinessMedia.com
SUPPLY & DEMAND CHAIN EXECUTIVE
S
TURNS 20!
upply & Demand Chain Executive (SDCE) marks its 20-year anniversary this year. And, boy do we have the content, coverage, news and information to celebrate! For starters, SDCE introduced the new Women in Supply Chain award, which will publish in our September 2020 issue. This award honors female supply chain leaders and executives whose accomplishments set a foundation for women in all levels of a company’s supply chain network. From trucking/3PL to software development to procurement and professional development, be sure to nominate that special lady deserving of some recognition for her hard work and achievements. Here’s a rundown of the 20-year anniversary coverage in store for the remainder of the year. Pros to Know “Where Are They Now?” Every Monday online, we revisit previous Pros to Know winners to reinterview and learn what they’ve been up to since last receiving this award, as well as discuss how the industry has changed, what they’ve learned and advice for incoming supply chain professionals. E-Commerce’s Impact on the Supply Chain. Discover the impact e-commerce has had on the supply chain in the last 20 years in e-commerce/retail, pharmaceuticals, automotive and more The Next 20 Years in Supply Chain. Check out this forecast of the future with 4
regards to “phygital” landscape trends, retail brick-and-mortar vs. online and back again. Find out what some of the top IoT, robotics and big data companies are doing to automate for the future. And, find market research stats and studies that outline where the industry is headed over the next 20 years. Your Career Over the Next 20 Years. Learn from other readers on how their jobs have changed in the last 20 years. This Day in History. From the first package shipment to the industry’s first software solution, follow this guideline through time. L.I.N.K. Education. SDCE editors interview students, young professionals, veterans and professors of the supply chain to discuss how the industry has changed in terms of recruiting, training and more. Also, check out L.I.N.K., our newly revamped podcast channel. Follow us on Facebook at www. facebook.com/sdcexec to tune into our Facebook Live discussions every Wednesday at 11 a.m. CST. And, register for our new SCN Summit, www.sdcexec.com/scn-summit. Twenty looks good on a publication that continues to evolve alongside the industry. Be sure to check out SDCExec.com for continued coverage.
Published by AC Business Media 201 N. Main Street, 5th Floor, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com
www.SDCExec.com PRINT AND DIGITAL STAFF GROUP PUBLISHER Jason DeSarle SALES ASSOCIATE Brian Hines EDITORINCHIEF Marina Mayer ASSOCIATE EDITOR Brielle Jaekel WEB EDITOR Mackenna Moralez SENIOR PRODUCTION MANAGER Cindy Rusch ART DIRECTOR Willard Kill AUDIENCE DEVELOPMENT MANAGER Angela Franks ADVERTISING SALES (800) 538-5544 JASON DeSARLE jdesarle@ACBusinessMedia.com BRIAN HINES bhines@ACBusinessMedia.com CIRCULATION & SUBSCRIPTIONS P.O. Box 3605, Northbrook, IL 60065-3605 (877) 201-3915, Fax: (847) 291-4816 Email: circ.sdcexec@omeda.com LIST RENTAL Jeff Moriarty, Infogroup (518) 339-4511 Email: jeff.moriarty@infogroup.com REPRINT SERVICES BRIAN HINES, (647)296-5014 bhines@ACBusinessMedia.com AC BUSINESS MEDIA CHIEF EXECUTIVE OFFICER Barry Lovette CHIEF FINANCIAL OFFICER JoAnn Breuchel CHIEF DIGITAL OFFICER Kris Heineman CHIEF REVENUE OFFICER Amy Schwandt VP AUDIENCE DEVELOPMENT Ronda Hughes DIRECTOR OF DIGITAL OPERATIONS & IT Nick Raether DIRECTOR OF DIGITAL STRATEGY Joel Franke GROUP CONTENT DIRECTOR Jon Minnick Published and copyrighted 2020 by AC Business Media All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher. Supply & Demand Chain Executive [USPS #024-012 and ISSN 1548-3142 (print) and ISSN 1948-5654 (online)] is published four times a year: March, June, September and December by AC Business Media, 201 N. Main Street, 5th Floor, Fort Atkinson, WI 53538. POSTMASTER: Please send all changes of address to Supply & Demand Chain Executive, P.O. Box 3605, Northbrook, IL 60065-3605. Printed in the USA. SUBSCRIPTION POLICY: Individual subscriptions are available without charge in the United States, Canada and Mexico to qualified individuals. Publisher reserves right to reject nonqualified subscribers. One-year subscription to nonqualified individuals: U.S., $30; Canada and Mexico, $50; and $75 for all other countries (payable in U.S. funds, drawn from U.S. bank). Single copies available (prepaid only) for $10 each. The information presented in this edition of Supply & Demand Chain Executive is believed to be accurate. The publisher cannot assume responsibility for the validity of claims or performances of items appearing in editorial presentations or advertisements in the publication. June 2020 / Volume 21 / Issue 2
SUPPLY & DEMAND CHAIN EXECUTIVE | June 2020 | www.SDCExec.com
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SUPPLY CHAIN NETWORK SUMMIT
is the premier virtual event educating logistics professionals on the critical issues impacting – and driving – the global supply chain and logistics industry
REGISTER FOR THE JUNE 30TH EVENT 10 AM CST: ONLINE GROCERY AMID COVID-19 With increase in online ordering and expansion of categories, how do supply chains evolve to meet the new needs? Deborah Weinswig, Founder and CEO of Coresight Research looks at current vulnerabilities in the supply chain and how online grocery can evolve to new consumer demand.
12 PM CST: THE VISIBLE, CONNECTED AND OPTIMALLY UTILIZED WAREHOUSE Modern warehouse operations are evolving rapidly to keep pace. Disparate labor shortages, blind spots in inventory and management of returns are common challenges. Mark Wheeler, Director of Supply Chain Solutions at Zebra Technologies, addresses these challenges and those prompted by the COVID-19 pandemic to share insights on how “systems of reality” can help prepare and protect supply chain operations from the unknown.
2 PM CST: THE IMPORTANCE OF SUPPLY CHAIN RESILIENCY Neil Coole, Director, Food and Retail Supply Chain Director at BSI Americas, discusses supply chain resiliency, including examples of best practice from business continuity to ensure that organizations throughout the supply chain can anticipate future impacts, prepare for disruptions and remain agile and responsive to future challenges.
4 PM CST: RETURNING TO WORK? HERE’S HOW TO PREP YOUR FACILITIES POST-PANDEMIC Bhrugu Pange, Managing Director of AArete, will discuss the tactical and digital requirements, safety measures, protocols, operational shifts, worker preparedness, attitudinal shifts and preparation of the physical spaces needed to help ensure worker safety in the workplace after a return from lockdown, focusing specifically on distribution warehouses, shipping centers and manufacturing plants.
TO REGISTER VISIT: www.sdcexec.com/scn-summit
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CHAIN REACTIONS
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NEWS FROM ACROSS THE DIGITAL SUPPLY CHAIN
nt
IBM & RED HAT
y
LAUNCH NEW EDGE COMPUTING SOLUTIONS FOR 5G
IBM announced new services and solutions backed by a broad ecosystem of partners to help enterprises and telecommunications companies speed their transition to edge computing in the 5G era. This effort combines IBM’s experience and expertise in multi-cloud environments with Red Hat’s open source technology, which became part of IBM last year. “In today’s uncertain environment, our clients are looking to differentiate themselves by creating more innovative, responsive user experiences that are adaptive and continuously available—from the data center all the way out to the edge,” says Denis Kennelly, general manager, IBM Hybrid Cloud. “IBM is helping clients unlock the full potential of edge computing and 5G with hybrid multicloud offerings that bring together Red Hat OpenShift and our industry expertise to address enterprise needs in a way no other company can.”
l
Ps
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’re
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RESEARCH FINDS COST TRANSPARENCY TO INCREASE SALES 20% Businesses don’t typically disclose information to consumers on how much it costs to produce a product. However, new research in the INFORMS journal Marketing Science provides evidence that doing so can increase consumers’ purchase interest by more than 20%. The study, “Lifting the Veil: The Benefits of Cost Transparency,” conducted by Bhavya Mohan of the University of San Francisco and Ryan Buell and Leslie John of Harvard Business School, found that cost transparency can increase sales, but only when done voluntarily. The study also found that cost transparency increases purchase interest even when prices are unexpectedly low or high. Cost transparency conveys more sensitive information to consumers than operational transparency alone by referring to the disclosure of the costs to produce a good or provide a service. It can be risky, though, because it makes the business vulnerable to experiencing negative consequences such as consumer ire or supplier price increases.
DIGITATE LAUNCHES IGNIO COGNITIVE PROCUREMENT,
USES AI TO MONITOR PURCHASE TRANSACTIONS Digitate released ignio Cognitive Procurement to help enterprises make smarter purchase decisions and take action faster. Global organizations with large and diverse procurement needs can receive superior outcomes by minimizing the number of purchase transactions that result in sub-optimal spend, non-compliance and processing fallouts. Traditionally, procurement organizations have tried to
6
address this with tighter controls and regulations, which adversely impact the overall cycle time. ignio Cognitive Procurement leverages artificial intelligence and machine learning to bring speed and scale to this process, enabling enterprises to deeply understand procurement behavior, monitor purchase transactions in the background and intervene when needed.
SUPPLY & DEMAND CHAIN EXECUTIVE | June 2020 | www.SDCExec.com
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BE RECOGNIZED FOR YOUR ACHIEVEMENTS
Each year, Supply & Demand Chain Executive recognizes individual and corporate leaders in the global supply chain. Plan now to enter your company, executive or a cutting-edge client or vendor in one of these industry-leading recognition programs.
2020
omen
in SUPPLY CHAIN
13 th Annual
WOMEN IN THE SUPPLY CHAIN
GREEN SUPPLY CHAIN AWARDS
Honoring female supply chain leaders and executives whose accomplishments, mentorship and examples set a foundation for women in all levels of a company.
Recognizing companies that implement green practices as a core function of their supply chain operations.
NOMINATIONS 7/10/20
NOMINATION DEADLINE: 9 /1 1 /2 0
Winners announced in the September 2020 issue.
Winners announced in the December 2020 issue
Award results, information and nominations posted on: WWW.SDCEXEC.COM/AWARDS Nomination dates and issues may change. Consult the call-for-entries email and nomination survey for confirmation.
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COVER STORY
By Brielle Jaekel
A SMART SUPPLY CHAIN
IS AN EFFICIENT ONE There are many emerging technologies that claim to help companies in the supply chain, but what’s best for each company depends on the operation and technology in question. 8
T
he Coronavirus disease (COVID-19) pandemic has brought to light many gaps in the supply chain. But, as the supply chain struggles to maintain business as usual, many companies turn to technology for help. While the virus has stalled exploration and testing of emerging technology and innovation, it has also pushed supply chain companies to introduce technology where they would not have in the past to help keep their businesses moving during the pandemic. “The supply chain is reeling from the effects of the COVID-19 pandemic, which has impacted the exploration of technology,” says Melanie Nuce, senior vice president of corporate development at GS1 US. “While a lot of innovation projects have been put on hold during these economically challenging
times, we believe emerging technology will continue to be explored to solve persistent supply chain challenges. In many ways, the COVID-19 pandemic has brought existing visibility and data quality issues to the surface and many companies are more committed to finding a way to address them.” Large-scale technology launches can take up to seven years. But, smaller scale activations that launch quickly help increase demand and keep employees safe. “Many of the supply chain industry’s least desirable common practices are being replaced or circumvented with technology, but it’s almost too late for those that haven’t yet started planning for these transitions considering how long they can take,” says Ken Fleming, president of Logistyx. “With global retail holding companies mapping out five-to
SUPPLY & DEMAND CHAIN EXECUTIVE | June 2020 | www.SDCExec.com
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GS1
Some tech providers are even expanding their offerings to help companies operate remotely. For instance, Augury released new capabilities in its software that is already used to manage the health and operations of machinery, but now creates a more robust diagnosis with added feedback and remote views of history and health support from experts. The idea is to better manage the machines off-site. Those who have automation and technological services already enabled throughout their businesses could have had a potentially easier time dealing with the pandemic crisis and social distancing between employees. Some larger warehouses are so
seven-year transition plans and some of the most established U.S. retailers requiring as much as three years or more each time they update their warehouse management system, it’s easy to understand why organizations that haven’t already launched these initiatives would hesitate to go to such lengths to embrace new technologies become more efficient and better serve customers.” Companies that have employees working remotely are able to do so by utilizing remote tools to handle their everyday tasks. This has caused businesses to deploy a variety of paperless tools and software to handle processes outside of their offices or locations.
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advanced in terms of automation that areas are off limits to human personnel, which means during a pandemic, operations in that area of the warehouse can continue. “Big warehouses are almost 100% robotic and automated,” continues Fleming. “People only intervene when problems happen, a box gets stuck, something gets jammed, etc. In these fully automated warehouses, nobody is picking products off shelves or packing boxes; on-site personnel manage maintenance, engineering and related tasks. “On the other end of the spectrum, in smaller warehouses that still rely on a lot of manual human intervention, technologies that speed up these manual processes continue to gain steam and market share. Scanner gloves, for example, from a wide range of manufacturers help warehouse workers scan products while they pick them from the shelves to save time, and this is just one example. Across the board, these ‘human assist’ technologies keep getting better and more advanced,” adds Fleming.
SMART SUPPLY CHAIN The supply chain as a whole leans toward smart manufacturing, where most of the supply chain process is managed with systems embedded into the Internet of Things (IoT). “Smart manufacturing is automating and optimizing the flow of production, procurement and logistics,” says Klas Orsvärn, founder of Tacton. “This makes it attractive to move production closer to the market. It also makes it possible to produce customized products
www.SDCExec.com | June 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE
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COVER STORY efficiently, to compete on value and protect margins.” Today, a variety of containers and pallets are now equipped with smart technology that can help increase visibility and reduce error during the logistics process. For instance, RM2 has launched a pallet design named BLOCKPal made of composite material with extreme durability and enabled for radio-frequency identification (RFID). Impinj also features solutions that show real-time movement of goods in and out of the warehouse and dock doors, location tracking for individual items inside the warehouse and automated verification that makes sure each carton is packed with the correct item and is placed on the correct pallet. However, while coffee makers, washing machines, vehicles and other consumer appliances and electronics have been a part of the IoT world for a while now, logistics products have
only just begun to become “smart.” “Some of the most exciting technologies emerging in the supply 10
chain industry today are the sensors technologies that extend the IoT beyond devices to connect more things to the Internet,” says Gaylene Meyer, vice president of global marketing and communications at Impinj. “By ‘things’ I mean containers, pallets, boxes—things that, until recently, were not included in IoT.” But, as the supply chain gets smarter, many warehouse workers worry about job security and whether a robot will replace them. The debate in this area remains strong, as some emerging technologies help augment an employee’s job and make it easier, while others can replace the worker all together. Those that are helping their employees see the benefits of these emerging technologies and use these processes in tandem with skilled staff members will see a more stable future. When these systems become integrated with IoT, companies can gain a significant amount of data to make their businesses better in the future such as better predicting demand, reducing common pain points and projecting best practices. As the sensors on the IoT solutions pick up the data, artificial GS1 intelligence (AI) can process this data for better decision making. For instance, Tacton’s Design
Automation can configure optimal solutions in a company’s operation process based on sensor data to create a more streamlined operation.
AI MAKES SENSE OF YOUR DATA One of the most talked about facets of emerging technologies is AI, which features a wide range of abilities. “In the short term, AI has been more frequently used for telling software and computer systems what to look for and what to do,” says Fleming. “But, in the future, AI’s role will be to better make sense of data. “Currently, supply chain AI consists of developers programming business rules, telling computers what to look for and what action to take when it encounters those situations, but as AI migrates to machine learning, it will begin to think for itself. As machine learning becomes more advanced, technologies will increasingly be able to make note of repetitive situations and past experiences to start learning and making recommendations on its own. Technology like this has already deployed on a wide scale in other industries, and it has the potential to rapidly automate and improve a wide range of supply chain processes,” says Fleming. In the supply chain, there is a major issue that can hinder the process of machine learning. So much of the sector is managed by different companies working together, but each company uses their own preferred technology and not everything is compatible, prohibiting the ability to grab and make sense of useful data. A few tech companies in the supply chain such as GS1 focus on the ability to work with many different solutions, but this is not the case throughout the entire supply chain.
SUPPLY & DEMAND CHAIN EXECUTIVE | June 2020 | www.SDCExec.com
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COVER STORY “In a more general sense, the pain points associated with technology implementation largely hinge on a company’s data sharing capabilities,” says Nuce. “For example, Organization A is supplying carrots to Organization B’s store using blockchain platforms offered by their respective technology providers. Can the data from Organization A’s system be easily accepted by Organization B’s system? Globally unique item identification is the core basis for a common language for the exchange of information. The use of GS1 Standards for identification and data sharing ultimately breaks down the barriers created by proprietary data sharing, both within organizations and externally.” Soon, the issue of data sharing might be recitified. “There’s a lack of consistency,” says Albert Lee, chief technology officer at Odyssey Logistics & Technology Data. “EDI/APA connections, customization and system requirements vary across shippers, carriers and 3PLs, making it difficult to take advantage of all the available technology. Very few have the integrated connections to make everything run seamlessly. Fortunately, many are getting closer. Leaders have to ask themselves whether their current systems are too limited. Can they become more integrated? Can they connect with the available people and resources to handle customization?” If partners can tap into that stream of data from the various points of business, AI will become even more useful. “The near future will see a mad grab of data elements wherever they may be,” says Jeremy Hudson, director of consulting services at Open Sky Group. “Great AI requires significant data from multiple streams. I think we continue to see software companies look for opportunities to harvest and mine data to provide more advanced metrics and decision-making tools. I think that we’ll see more IoT devices assist in this effort, and ultimately contribute to better decision making throughout the supply chain. The supply chain’s biggest need now is not new solutions, it is tools to make better decisions. Many of the supply chain pain points we see are due to bad
Open Sky Group
decisions and misguidance, which leads to downstream volume constraints and waste.” It is no doubt that data is extremely helpful in this sector, but its usefulness is only as good as its quality. “Both the quality and value of data inputs are critical to the effectiveness of an AI system,” says Meyer. “When we refer to the quality of data, we mean the accuracy, fidelity and specificity of that data. You must be confident data reflects reality, metrics are repeatable and the data is complete— reflecting all there is to measure. In addition, the data must provide value, not noise. It must be understandable and actionable.”
CLOUD OPERATIONS HELP BUSINESSES MANAGE MACHINES REMOTELY.
FOLLOWING THE SHIPMENT One of the favored aspects of a smart supply chain is the ability to see real-time information on a shipment’s status and whereabouts. Visibility is a key factor in logistics, as companies have now become accustomed to knowing greater details about their shipments. Technologies such as RAIN RFID, GPS trackers and blockchain software have brought more visibility into the supply chain to help logistics partners better serve their customers. For example, GS1’s RFID EPC technology fits a variety of logistics hardware such as rail-freight wagons with sensors that interact with fixed readers at various points in a shipment’s journey. This allows companies to track shipments as well as the condition of the mode of transportation like the health of the truck or rail.
COLLABORATION IS KEY WITH TECHNOLOGY IN THE SUPPLY CHAIN.
www.SDCExec.com | June 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE
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COVER STORY These systems, sensors and data can significantly reduce the number of mistakes associated with human error that happen on site during the transportation of goods. Eliminating these errors can help logistics companies on their bottom line as well as keep customers happy. As these sensors such as RAIN RFID collect data from the individual boxes or pallets, it connects with the larger supply chain management systems to create a holistic view of the operation, monitoring to create the correct quantities at the correct location at the appropriate time. This also allows managers to see the more common pain points in an operation and eliminate them. “Stand on a loading dock of a busy distribution center and you’ll see dozens of trucks pulling up to dozens of dock doors with thousands of boxes traversing the facility floor,” adds Meyer. “Even if this facility is running with 98% accuracy, the cost of errors adds up every hour, every day. And, the hard cost of each error is only part of the problem. Disappointed customers will choose a different supplier they can rely on in this competitive world. “According to a study by the University of Auburn, RAIN RFID raises inbound shipment accuracy from suppliers from 31% to 99.9%. This accuracy translates into better visibility, leading to a better customer experience,” says Meyer. Another technology key in visibility 12
is blockchain, which can integrate with the IoT services that help move shipments and records in a secure and understandable way. The healthcare sector seems to get a leg up in this area. “Blockchain is reinvigorating the conversation around improved data sharing, and increasingly companies are engaging more broadly with their trading partners to share accountability for the visibility of products across supply chains,” says Nuce. “The food and healthcare industries have the highest concentration of pilot programs under way right now, as recall responsiveness and product traceability are key to meeting the requirements of FDA regulations.”
ROBOTICS TAKEOVER While sensors gain information from pallets and shipments and AI sorts the data, some technology even moves itself. One of the most futuristic aspects of the supply chain is robotics, of which many are equipped with AI themselves, allowing them to operate without a human worker. The ideal environment in which a person and a robot work in tandem is one where robotics handle repetitive tasks like continuously retrieving and moving items throughout the warehouse, specific jobs carrying out
commands. Human workers are suited for assessing situations and making intelligent decisions on what commands to give the robots. “Companies are using mobile robots to replace tedious, mindless jobs, Odyssey while at the same time augmenting those jobs with roles that are more stimulating,” says Lior Elazary, co-founder and CEO, inVia Robotics. “What the proliferation of automation allows for is for people and robots to do what they do best.” Some robotics in place operate the same way an autonomous vehicle does, with the ability to move around the warehouse with awareness to their environment, without having to be manually controlled. For example, inVia’s robotics system includes AI-enabled robots that move throughout a warehouse on their own and can be monitored through remote software. The idea here is to reduce unnecessary travel throughout the facility, thus wasting time and energy of the workers. Another key technology is automated guided vehicles (AGVs), which use sensors and cameras to move around the warehouse just like driverless cars. There are also automated storage and retrieval systems that can find, retrieve and put away items, goods-to-person technologies that grab and deliver individual SKUs to human workers, autonomous mobile robots (AMRs) that can operate on their own and robotic arms that help with pack-and-pick. Go to https://www.sdcexec. com/21133671 to read more.
SUPPLY & DEMAND CHAIN EXECUTIVE | June 2020 | www.SDCExec.com
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2020 Educational Webinar Series
STAY ON TOP OF THE LATEST TRENDS AND BEST PRACTICES OF THE ENTIRE GLOBAL SUPPLY CHAIN.
September 23
Implement the Next Wave of Industry 4.0 A company’s supply chain is its competitive advantage in the marketplace. Adopting an Industry 4.0 approach to supply chain processes and efficiencies through digital transformation is more imperative than ever before. How critical is Industry 4.0 to your business? Consider that between 2019 and 2024, the Industry 4.0 market is expected to grow from $71.7 billion in 2019 to $156.6 billion by 2024, according to ResearchAndMarkets. Learn how to implement the next stage of Industry 4.0 for greater supply chain outcomes.
October 14
Warehouse Automation Warehouse automation continues to transform the supply chain and logistics industry. From forecasting and inventory refill to visibility and end-to-end traceability, today’s warehouse solutions are designed to improve the way company track and trace product. But, how else do these solutions optimize the warehouse? Discover how warehouse automation helps boost companies to the next level.
December 2
The Future of Supply Chains / Executive Outlook
s
Automation, robotics and Internet of Things remain hot topics going into 2021. But, how do things like a global pandemic transform the way these trends are implemented? What are companies doing differently to mitigate risks and better protect their people, product and planet? This industry outlook details what the future supply chain looks like, and how cutting-edge technologies help companies better prepare for what’s to come.
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AWARDS
By Mackenna Moralez
RESILIENCY
IS A MUST WHEN IT COMES TO
SUPPLY CHAIN
PROJECTS
W
hen it comes to supply chain projects, resiliency is a must-have component. “I think my favorite part about the supply chain is that there’s always a challenge to overcome,” I said to someone I interviewed for an upcoming L.I.N.K. podcast. This industry, as 2020 has proven to us, is not for the faint of heart. To say that the first half of 2020 has been “one for the history books” would be an understatement.Puerto Rico experienced shattering earthquakes, the United States senate began the impeachment trial of President Donald Trump and the world lost basketball legend Kobe Bryant in a helicopter crash– and that was just in January. But, the world was still optimistic. Jason Schenker, president of Prestige Economics, explains that unemployment was at an all-time-low, the economy was good and the country had good credit. And, then the Coronavirus disease (COVID-19) pandemic happened. It was like the world shut down overnight. Countries like 14
Spain, China and Italy ordered a lockdown, barring citizens to leave their homes. Meanwhile, nearly the entire United States was placed on “stay-at-home” orders. “Right now, we fear with Coronavirus that no matter how fast or how cheap they produce it, they don’t want it. People aren’t willing to go get it,” says Schenker.“We might see a lot of retail stores never come back. We might see e-commerce become more important even more rapidly—we just don’t know. While the COVID-19 pandemic may be the biggest challenge the industry has ever had to overcome, each company has continually proven their resiliency by implementing new solutions and best practices in all links of the supply chain. But, that’s what supply chains do best—they overcome challenges without fully breaking. The 2020 SDCE100 award focuses on the industry’s most successful and transformative projects over the last year. These collaborations have delivered value to enterprises across a range of supply chain functions, offering a forward-looking perspective as new opportunities—and
c h
new struggles—arise. It is essential that a company continue to pursue, develop and implement best practices that leverage well-organized projects relevant to strategic objectives. The outcome of these featured SDCE 100 projects provide further insight into the innovation and improved operations within supply chains.
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VENDOR: 3PL Central LLC CUSTOMER: Brilliant Fulfillment PROJECT GOAL: Boost operational efficiency, integrate with third-party shopping carts and have real-time visibility of inventory. SOLUTIONS: 3PL Warehouse Manager WMS BUSINESS IMPACT: After implementing 3PL Central’s warehouse management solution, Brilliant Fulfillment’s order volume grew by 175% in the first year, with complete visibility of real-time warehouse operations data. Meanwhile, Brilliant offers value-added services such as e-commerce connectivity, EDI capabilities, kitting and assembly, triple-checked quality control, real-time inventory, real-time tracking and reports that helped triple revenue in 5 years.
VENDOR: Agistix CUSTOMER: Biomarin PROJECT GOAL: Gain global supply chain visibility and execution to streamline order-to-cash processing
SOLUTIONS: Agistix platform BUSINESS IMPACT: By implementing Agistix’s platform, Biomarin’s global supply chain team has been armed with the ability to use a single place to monitor, manage and measure carrier performance across all modes. This includes centralized shipment activity and documentation to meet global compliance requirements, auditing invoices and helping forecast spend based on what’s delivered and not invoiced.
VENDOR: Bastian Solutions CUSTOMER: Biomedical Company PROJECT GOAL: Provide an integrated picking and storage solution that will enable this
biomedical company to increase order accuracy and efficiency within their unique temperature requirements.
SOLUTIONS: OPEX perfect Pick HD, Bastian Solutions conveyor, Kardex VLM, Hytrol Conveyor, Intralox sortation, Wildeck VRC BUSINESS IMPACT: The biomedical company previously used a carousel system that slowed pick rates. Customers can now sustain 20% yearover-year growth. This provides the biomedical company with increased operational efficiency in order to reduce labor headcount from 36 associates to 16. VENDOR: DW Morgan Co. CUSTOMER: Electronics Manufacturer PROJECT GOAL: Integration and synchronization of multi-party title transfer statuses to automate revenue recognition and optimize financial compliance and auditability. SOLUTIONS: ChronosCloud BUSINESS IMPACT: Results have outperformed initial objectives and provided a platform to further supply chain visibility, analytics and digitization. The company saw overall reduction in cost exceed 15% compared to the previous model, including the client’s reduced human resource requirements. The system also enhances visibility across all supply chain partners. VENDOR: Elemica CUSTOMER: Global manufacturer of mined materials and compounded chemicals PROJECT GOAL: Automate transportation execution and gain visibility into logistics activity for ocean, land and rail lanes. SOLUTIONS: Elemica Network, Quick Link Email – MOVE, Trace – Logistics Visibility, Elemica SEE www.SDCExec.com | June 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE
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AWARDS BUSINESS IMPACT: Elemica connected 16 logistics providers by EDI and over 200 by Quick Link Email, which automates shipment confirmations into its ERP solution. The client also implemented Elemica’s SEE product, providing a single place to gain visibility. As a result, the client saw improved customer experience, better working capital management, faster receipt of demand signals, increased market share and revenue and lower cost to serve. VENDOR: Flock Freight
VENDOR: Logistics Plus Inc.
CUSTOMER: Greenshield Organic
CUSTOMER: Fortune 500 Global Retailer
PROJECT GOAL: Reduce greenhouse emissions through pooling technology.
PROJECT GOAL: Provide warehousing and fulfillment of warranty parts from Asian suppliers to North American consumers.
SOLUTIONS: FlockDirect BUSINESS IMPACT: Flock Freight has helped ensure that Greenshield Organic’s shipments remain 100% damage free, enabling the company to meet strict delivery appointments with its weekend transit options and on-time delivery guarantee. This allows Greenshield Organic to avoid hefty fines and fees while keeping its customers happy. By using FlockDirect, the company has eliminated fuel emissions by 40%, positively impacting its overall carbon footprint.
VENDOR: Hub Group CUSTOMER: Leading carveout CPG company
PROJECT GOAL: Streamline retail operations, enhance visibility, reduce or eliminate retail supply chain performance penalties and optimize expanded business. SOLUTIONS: Hub CaseStack Retail Supplier Solutions
SOLUTIONS: Cloud-based OMS and WMS, TMS, global trade management system
BUSINESS IMPACT: As consumers call the client’s customer service line requesting a warranty replacement part, the client CSR logs into a web-based interface and orders the part, which allows the OMS to drop orders to the WMS. Warehouse staff will then pick and ship the items within 24-hour service-level agreement and the replacement part is delivered to the consumer with a 5-day period.
Group
BUSINESS IMPACT: Hub Group’s endto-end supply chain solution replaced eight incumbents with 16
a fully streamlined outsource for the client. Hub Group’s extensive network and suite of solutions drove 8.5% in overall cost savings, a cube maximization of 98% of all inbound weight above 44,000 pounds and a 96% on-time and in-full score for all outbounds. By using the company’s technology, the client gained visibility into inventory levels, order tracking and all documentation needed to avoid costly retail fines.
VENDOR: Optricity CUSTOMER: Navistar PROJECT GOAL: Greenfield slotting of 40,000 SKUs into a 296,000-square-foot distribution center with the ability to serve at start-up and increase capacity. SOLUTIONS: OptiSlot DC
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AWARDS BUSINESS IMPACT: This solution enables primary pick location for all items moving into the facility, which contributed to reduced replenishments. Additionally, the slotting strategy implemented addressed the objectives needed for the move and additional slotting goals.
VENDOR: Packaging by Quadient CUSTOMER:
a forklift operator. From the start, participants embraced the virtual reality platform, saying it offered a more engaging and realistic experience before performing on the job site. The students mentioned that watching one another advance through the lessons served as an additional way of learning and set the stage for friendly competition.
Rue Gilt Groupe
PROJECT GOAL: Use automation to create transportation savings and reduce the labor hours dedicated to packaging by creating fit-to-size boxes. SOLUTIONS: CVP Impack with Dual Induction and Multiple Corrugate Mills BUSINESS IMPACT: Rue Gilt
weight and
Groupe made the transition to the CVP Impack without any impact on its operations or its ability to service its e-commerce customers. RGG also experienced tremendous savings in transportation, labor and materials. The CVP eliminates void fill and excess air from each carton, reducing dimensional lowered material costs.
VENDOR: The Raymond Corporation CUSTOMER: Broome- Tioga Workforce New York
PROJECT GOAL: Find and train skilled labor to fill warehouse positions at various community distribution centers. SOLUTIONS: Classroom-based courses, team-building lessons and conducting professional development skills training.
VENDOR: Shipwell CUSTOMER: Meal Kit Company PROJECT GOAL: Scale the supply chain to enable rapid growth for large meal kit company. SOLUTIONS: Cloud-based TMS platform BUSINESS IMPACT: Within the first six months of implementing Shipwell’s platform, the meal kit company achieved a 20-time ROI and decreased annualized shipping costs by $10 million. After the first year, it realized a 75% ROI compared to an anticipated 30% through a decrease in spoilage, lower rates and reduction in loss of goods sold. VENDOR: Vecna Robotics CUSTOMER: Milton CAT PROJECT GOAL: Increase order fulfillment speed, optimize workflows and improve employee safety.
SOLUTIONS: Vecna Robotics RL3600 autonomous lift truck
BUSINESS IMPACT: Vecna Robotics’ RL3600 autonomous lift truck provided Milton CAT an improved shuttling system from parts storage to the shipping area of the distribution center. With no infrastructure changes required, warehouse personnel could call the first autonomous lift truck on demand and see if it’s efficiently fulfilling orders.
BUSINESS IMPACT: The Raymond Virtual Reality Simulator gave participants a better understanding of the skills needed to succeed as
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AWARDS .VENDOR: Velociti Alliance
North America Inc.
CUSTOMER: N/A PROJECT GOAL: Reduce labor cost and increase accuracy of high-demand, short fulfillment cycle items that make up the majority of the customer’s profits.
SOLUTIONS: Velociti CloudLogic, CloudPick and CloudPack
BUSINESS IMPACT: Within three months, the system paid for itself, as the client estimates a savings of over $1 million each year due to system efficiencies. Specifically, batch picking of items up to 20 orders at a time, and earlier visibility of inducted product for immediate order fulfillment has increased order fill rate, thus decreasing lost sales.
VENDOR: VeriShip CUSTOMER: SimpleTire PROJECT GOAL: Manage parcel shipping rates and surcharges, improve carrier contract negotiations and consolidate carrier bill reconciliation and payments. SOLUTIONS: VeriShip Intelligence Platform, VeriShip Parcel Audit, VeriShip Data Bridge BUSINESS IMPACT: Easy-to-understand VeriShip dashboards give SimpleTire views on spend, surcharges and carrier performance. SimpleTire has received thousands in surcharge credits and refunds, automatically itemized and secured through VeriShip. With the dashboards, SimpleTire will recover or avoid more than $1 million in shipping fees over the next two years. Meanwhile, by streamlining the carrier invoices and bill pay process, SimpleTire’s accounting office saves several hours a day.
Right-Sized, Automated Packaging PAYS BACK BIG.
The CVP Impack is a for ecommerce comp shipping costs and in solution creates a cu seconds.
Efficient, hi velocity pac Ease labor concerns
Reduce cor & material
2020
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AWARDS VENDOR: Wesco Distribution CUSTOMER: Wesco Distribution PROJECT GOAL: Value creation for its customers and suppliers, productivity improvement, efficiency and speed of execution, process standardization, digitization and centralization enablement.
SOLUTIONS: UiPath BUSINESS IMPACT: Productivity improvement in hours saved and competition of work that was never done before. Gained execution speed and efficiency, thus impacting both operational and commercial excellence. Risk avoidance and error reduction from process standardization and automation of execution created additional opportunities for centralization.
21CC Education 21CC Education Accelerate on-boarding through gamified mobile learning.
42Q Bloom Energy Streamline and increase discrete manufacturing production capabilities using an AWS-based MES.
6 River Systems Lockheed Martin Corporation Increase productivity, improve warehouse environment and implement order picking processes and technology.
A. Duie Pyle Leading supplier of MRO products Implement engineered integrated solution that blends resources in an efficient and cost-effective manner.
ALOM ALOM Integrate WMS for business intelligence-driven inventory management and demand planning to eliminate backorders.
antuit.ai Largest global CPG bakery Improve order accuracy to minimize waste without lost sales from understocking.
e CVP Impack is a fit-to-size automated packaging solution ecommerce companies challenged by labor constraints, rising pping costs and increasing order volumes. This award winning ution creates a custom-sized boxed for each order every seven conds. Efficient, high velocity packaging
Reduce shipping volume
Ease labor concerns
Reduce freight & DIM weight costs
Reduce corrugate & material costs
Alleviate peak season challenges
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AWARDS APPLIED ACUMEN LIMITED Best Food Logistics
CT Logistics Home Goods Company
FourKites, Inc. Land O’Lakes Inc.
Transform service performance to survive.
Implement supply chain routing analysis technology to maximize lane effectiveness and transportation mode/lane selections.
Unlock unused freight capacity for more efficient operations.
Asia Pulp & Paper (APP) Villa Chicken Provide sustainable and cost-effective packaging solution that maintains quality standards.
Demand Clarity Inc. Princess Auto Ltd
Asian Paints Asian Paints
selling location.
Improve accuracy of its demand forecast.
Avetta Global building solutions company and leading supplier of cement Implement supply chain visiblity system to identify and maximize use of compliant suppliers across business units.
Blume Global OL USA Deliver end-to-end visibility, alerts, reports and analytics to improve customer experience, drive value and grow client base.
Bringg Planzer Implement technology platform to produce further growth and improve shipper, customer, dispatch and driver relationships through digital transformation
CAI International CAI Logistics Prevent significant portion of dry freight container floor repair costs.
CHEP Michigan Sugar Company Help shelf-ready products meet new retail expectations while reducing labor costs and environmental impact.
CMX (ComplianceMetrix) Restaurant Brands International
Transform supply chain to be driven by a forecast of consumer demand by item/store and/or item/
Demand Management, Inc. Fast-growing consumer products company
GEP Leading financial services firm Build agile function for greater savings and improved efficiency.
HighJump Hunt Brothers Pizza/DBH Distributing
Dematic Northern Cooperative Meat Company
Future-proof operation and support organizational growth.
Optimize distribution and dispatch process to address increased demand for Australian red meat
Hyster Company New Belgium Brewing Company
in the Asia market.
dexFreight Freight Broker Enable small freight broker to handle shipments in a logistics marketplace.
DMW&H Conair Build new multichannel facility with automation that will expand to fast growth.
enVista Manufacturer Develop a formal S&OP process and inventory strategy to enable to drive continuous improvement throughout the company.
Esker, Inc. Lam Research Corporation Provide solution for Lam’s customer service center to help manage growing customer base and increased order volumes.
Fictiv HEBI Robotics
ing product quality and food safety.
De-risk supply chain through consolidation via Fictiv’s global manufacturing ecosystem.
Implement digital workflows to remove paper
Fine Tune Flint Group
from business process to improve productivity.
Provide vigilant uniform category management.
Crisp Nounos Creamery
Flexport Flexport
Provide weekly demand forecasting to improve
Provide frontline responders with PPE to fight
production process.
COVID-19 pandemic.
Crown Equipment Corporation Lipari Foods
FocusedBuyer LLC FocusedBuyer
Determine appropriate design, racking and material handling equipment for new warehouse.
Transform business processes and optimize system configuration to eliminate manual activities and operational roadblocks.
Improve alignment of the company’s production with today’s market needs.
Provide single platform for vendor management, product life-cycle management and ensure ongo-
Command Alkon Iowa Department of Transportation
FutureSoft Business Consulting Juffali Automotive Company
Streamline keg line operation with lift trucks moving efficiently in tight spaces.
iGPS Logistics Major beverage producer Launch storage/transportation solution that streamlines supply chain automation, reduces costs, introduces efficiences, enhances sales value proposition and improves sustainability.
InfinityQS® International, Inc. Strategic Materials Standardize quality data collection across 31 recycling plants to enable real-time process performance visibility, immediate issue detection/ correction and cross-plant analysis.
Insight Sourcing Group Footwear, sports and casual apparel company Reduce SG&A expenses.
Intelligent Audit PetCo Optimize omnichannel fulfillment strategy that helps achieve cost-effective next-day ground footprint for all e-commerce orders.
Ivalua Booking.com Transform 16 years of procuurement disconnect into business enablement and business partner service.
Ivanti Wavelink J.J. Keller & Associates Inc. Modernize warehouse environment by replacing legacy Windows-based devices.
Deploy real-time simulation solution that teaches students how to wisely spend money.
Fortna Inc. L.L.Bean Constrained warehouse capacity limited growth.
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AWARDS John Galt Solutions Combe Inc.
Nolan Transportation Group Crate & Barrel
SmartDrive Systems, Inc. Leavitt’s Freight Services
Implement Atlas Planning Platform to support S&OP globally.
Improve domestic OTR supply chain with focus on customer service, responsiveness, shipment
Adopt video-based safety program to improve
Kenco Walker Edison
visibility and on-time performance.
NorthFind Management NorthFind Management
New e-commerce multi-channel fulfillment center to be operational in 90 days.
Combine behavioral economics with demand planning best practices to mitigate effects of
LeanCor Supply Chain Group BG Products Inc.
biases and improve forecast accuracy.
Assess key distribution processes and design new distribution center that enables productivity
Novartis Novartis
improvements.
optimization.
Deliver cognitive direct sourcing solution that
Omnics, Inc. Global Shoe Company
achieves business-changing outcomes.
Lineage Logistics Lineage Logistics
Implement automated and intelligent demand planning and forecasting solution company-wide.
Create the cold storage warehouse of the future to maximize storage space, improve speed/efficiency
Onfleet United Supermarkets
and lower costs/energy use.
Logility Bodybuilding.com
Boost delivery efficiency while maintaining stellar
Optimize inventory planning and replenishment, focusing on assortment rationalization and promotion management.
Pace Harmon Global Private Equity Firm
customer experience.
Create and provide sourcing tools for value cre-
Logistical Labs LoadDelivered Logistics
ation to portfolio company investments.
PathGuide Technologies, Inc. Englewood Marketing Group
Allow customers to choose their own rate and carrier when booking shipments.
Integrate WMS and shipping system to add capac-
Lytx Cargo Transporters
ity to fulfillment operations.
PINC The Chemours Company
Implement Lytx’s driver safety program to reduce fraudulent claims, exonerate drivers and improve safety within its fleet.
Reduce costs and automate yard processes..
Plantensive Solutions Group Shearer’s Foods
Material Handling Systems, Inc. UPS
Determine optimal manufacturing footprint and transportation network to serve demand at lowest
Shift from older equipment to fully automated system with new sortation and conveyors.
cost possible.
Mobilogix Enterprise Holdings
RateLinx Fortune 500 Electronics Retailer
Tailor and implement patented telemetry solutions to improve operations and maintenance.
Improve operational inefficiencies, optimize staffing imbalances and achieve accurate delivery
mondCloud, Inc. TURVO Inc.
times with end-to-end visibility.
Redwood Logistics Taylor Farms
Onboard customers that use the Turvo platform.
Newmine Omnichannel retailer of women’s activewear
Loss prevention, increased productivity and visibility and improved trailer management capabilities and carrier partner satisfaction.
Enhance revenue and increase supply chain sustainability through disciplined returns reduction.
Saddle Creek Logistics Services Happy Family Organics
NGC C&A
Provide scalable fulfillment solution to accommodate exponential sales growth.
Implement platform for agile product development and faster speed-to-market.
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Soft Robotics NIBCO Implement pick-and-place automation.
Synergy North America Inc. PetFlow Deploy flexible WMS to handle expansion down the road.
Decrease transportation costs, IBC reduction, increase distilled solvent usage, labor saving improvements, waste solvent sales and tank farm
LevaData IBM
driving skills and protect fleet from legal liability.
ToolsGroup Franke Improve forecast outcomes in multi-echelon environment and support inventory optimization and replenishments in locations without SAP.
Transplace Transplace Provide intelligence to improve transparency, reduce empty miles, cut waiting times and enable efficient end-to-end processes.
UPS - Customer Solutions UPS Customer Solutions Determine cost, service and GHG emissions levels of supply chain scenarios compared to current baseline supply chain.
VAI Hardware and Lumber Track store foot traffic and corresponding sales data to determine peak times and generated sales.
Velociti Alliance North America, Inc. Volociti Alliance North America Inc. Reduce labor cost and icnrease accuracy of high-demand, short fulfillment cycle items.
Verusen Georgia-Pacific Support initiative to reduce working capital, obtain inventory visibility and re-balance MRO inventory through a virtual network.
XPO Logistics, Inc. XPO Logistics Achieve supply chain efficiency by harnessing digital capabilities and data science.
Yale Materials Handling Corporation Goya Foods Decrease product touches and improve storage density using custom high-density racking system.
Z5 Inventory Steward Health Care Reduce cost of medical and surgical supply expiration.
Zebra Technologies Saddle Creek Logistics Services Enable omnichannel operations expansion with cloud-based WMS and integrated Android-based mobile computers.
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MADE IN AMERICA By Mackenna Moralez
DR. BRONNER’S WASHES AWAY UNCERTAINTIES
D
r. Bronner’s has always stood out on the shelves. The company is famously known for its social justice label filled with imagery alluding to Christianity, poetry, sustainability and achieving the impossible dream. The labels even include Dr. Bronner’s life goal—“to keep my health, to do my work, to love, to live, to see it.” Now, over 150 years later, Dr. Bronner’s soap is more popular than ever as consumers have stockpiled essentials such as soap because of the Coronavirus disease (COVID-19) global pandemic. Yet, the business hasn’t compromised on its corporate values, even as demand continues to increase. According to a company statement regarding COVID-19, its hand sanitizer is being produced at 600% its usual rate, and
camps. That’s why it was important to put something good out into the world. Milam explains that Dr. Bronner would stand in Pershing Square in Los Angeles, educating passersby about the soap and his mission, but not many would actually stop to listen to him. So, he put his mission on the label, creating a signature piece. “He took his peace plan and put it on the bottles, so even if they didn’t have cash, he still caught their attention because they were reading it at home in their shower,” Milam says.
2% of all hand sanitizer production is being be donated to at-risk communities. “Dr. Bronner was a real person. His idea—and the family still holds onto it—is constructive capitalism. You should share your profits with the people that help you make them,” explains chief operating officer Michael Milam. “ [Dr. Bronner’s is] a fifth-generation soap company that came out of the guild system in Germany, and this is the third generation of the company in America. Its functionality started in 1948 here [in the United States]. Over the past 15 years, we have grown 11-fold, and manufacturing has always been in Southern California.” The company’s corporate values often align closely with its customers, creating consumer loyalty. Dr. Bronner immigrated from Nazi Germany, losing his parents in the concentration
PUTTING SUSTAINABILITY FIRST
Pexels
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The soap market, especially in the age of COVID-19, is extremely competitive. However, Dr. Bronner’s soaps differ from its competitors in various ways. Milam says that the company’s soaps are in fact “real” soaps, meaning that it’s a salt of a fatty acid. “Back in World War II, all the soaps were like the kinds you can make at home. That is what we still are. It is a vegetable oil reacted with either a potassium hydroxide or sodium hydroxide,” says Milam. “Soaps now are synthetically based or a mix of synthetic and water to have it foam more. Ours are almost fully biodegradable and it does so rather quickly. In addition, our supply chain is very clean, both ethically
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and chemically speaking. You can understand everything that’s on our label.” Dr. Bronner’s takes pride in being sustainable. In 2003, the company became the largest personal care company certified under USDA’s National Organic Program, pioneering 100% post-consumer recycled plastic bottles. In 2014, it committed to becoming a zero-waste company, with an end goal in mind for 2025. Its 2020 All-One! sustainability report details its renewable energy systems, efficient transportation, responsible packaging and sourcing of raw materials from local farmers who use regenerative organic practices that draw down atmospheric carbon. “Most of our inputs are agricultural, and that contributes to our sustainability. We have been engineering a new standard called regenerative organic,” says Milam. “All our sustainability goes through our cost page and the way that we structured our supply chain. It’s organic to get in the door, and then after that we regenerative.” “We think that by 2021, that just by the tonnage of soil that’s being produced, we should be carbon positive,” Milam says.
ACCEPTING AUTOMATION
balm, which require a range of different skillsets and machinery. Still, the company utilizes both automation and human employees in its warehouses. “We use lots of automation, but you still need people to run it. The actual machines that make the soap are fully PLC control equipment. We have five filling lines and we still do a little bit by hand,” Milam says. “We do that because we ship to 22 countries, and there are some things that just aren’t suitable for machines. We have machines of varying speeds and that keeps the quality up while keeping the cost down.” “We bring automation in to improve the quality, improve the workflow and improve employee satisfaction,” says Milam. “Automation allows you to keep your margin.”
MAINTAINING QUALITY
Dr. Bronner’s
One thing that has been made clear during the global pandemic is the need for warehouse automation. The company produces roughly 3,000 gallons of liquid soap in 2.5 hours. However, Dr. Bronner’s has diverse product offerings, including bar soap, shampoos and lip
much of it relies on knowing the ins and outs of the supply chain. Part of the company’s fair-trade supply chain is to increase visability as much as possible. “We can trace our batches back to the farmers, and we also have relationships with them. We know the plants that produce the oil very well,” says Milam. “We’re a modern company, we keep the soap production and the filling under statistical process control. There’s QA on the supply side, just making sure that our processes are good. Then we do a healthy dose of QC to make sure that nothing got by us in there.” Maintaining that quality means continuing to manufacture in the United States because it limits the amount of disruptions the supply chain is exposed to. “When we think about global transport, we always think of it as a utility—you pay the money and it happens and things just show up. But, when things like the West Coast ports slowdown in 2014 happen, you realize that really is on the other side of the world and there are forces that can keep the product from getting there. If you manufacture locally, you’re putting the risk off,” says Milam. Unsplash
Ensuring the quality of its products is crucial to Dr. Bronner’s business, and
○ DR. BRONNER’S SOAP IS KNOWN FOR ITS WORDY LABELS THAT PROMOTE SOCIAL JUSTICE AND PEACE.
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SPECIAL REPORT EMERGING TECHNOLOGY
By Michelle Szylakowski, manager, offering management, conveyor solutions, Honeywell
HOW AUTOMATION HELPS
SUPPLY CHAINS
MANAGE PRODUCTIVITY
TO SUSTAIN E-COMMERCE GROWTH
Selecting a best-fit sortation solution requires considering the unique characteristics of both the operation and available technologies.
Now is the time for e-commerce retailers to sort out their plans for handling the dual challenge of online sales growth and meeting customer expectations for fast, accurate delivery. 24
I
t’s no secret that most Americans are increasingly shopping online. According to U.S. Census Bureau’s recent statistics, e-commerce sales in the fourth quarter of 2019 totaled $158 billion, a 16.7% increase as compared to Q4 2018. In fact, 89% of Americans make purchases online, with one in three doing so every week, according to a Fortune poll. What’s more is, the Coronavirus disease (COVID-19) has changed Americans’ online shopping habits even further—U.S. online sales of consumer packaged goods grew 56% for the one week ending April 18, compared to the same period a year earlier, according to data from Nielsen and Rakuten Intelligence. This translates to high growth rates in e-commerce sales. Simultaneously, competition for consumers’ online dollars continues to intensify, especially as Amazon, Target and Walmart remain locked in a three-way battle to win customers through same-day delivery services. Therefore, all distribution operations must be able to deliver in order to keep up. Forbes reported that 75% of shoppers expect all brands to offer
same-day delivery within the next 12 months. Translation? Having a robust e-commerce supply chain, especially in light of COVID-19, with the ability to support expanding and diverse inventory, error-free fulfillment and fast, free delivery options is no longer optional in the e-commerce world. It’s now essential for success, growth and customer retention. Now is the time for e-commerce retailers to sort out their plans for handling this dual challenge of online sales growth and meeting customer expectations for fast, accurate delivery. To remain competitive, operations must find ways to handle as many individual orders as possible, simultaneously. Fortunately, this is exactly why automated sortation solutions are a vital part of the e-commerce supply chain. Automated sortation solutions consolidate, separate and route individual items and orders to their unique destinations at maximum throughput rates. Although all these systems merge, identify, induct, divert and convey products to specific destinations, finding the best-fit automated sortation solution to deliver the accuracy, efficiency and flexibility necessary to remain
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SPECIAL REPORT
Hon
eyw ell
EMERGING TECHNOLOGY
competitive requires a thorough review of operational requirements and the automated sortation system options available. The evaluation process should include three key steps: 1. Gather key information about the order. To help determine the optimal solution, facility management must know total number of orders handled per day, ratio of multi- to single-line orders and outbound packaging types used and their degree of dimensional consistency (or inconsistency). The wider adoption of smaller, more malleable packaging types (such as envelopes, polybags and bubble mailers) for direct-toconsumer shipments is often the most critical factor in system selection. Implemented in response to the introduction of widespread dimensional weight pricing by carriers, these lighterweight packages cost less to ship, but create additional catch points that increase the chances of sortation conveyor jams or sortation loop recirculation. Their use varies by operation, but modern fulfillment centers should consider the degree to which they currently (or will increasingly) handle a mix of malleable polybags, rigid corrugated cases and flexible bubble mailers. This means deploying a sortation system capable of reliably handling the unique challenges of all packaging types. 2. Determine the intended outcome of the sort. Certain sortation processes facilitate
Getting an automated sortation system up and running fast depends on a variety of factors, some of which can be controlled by the end user and some of which cannot.
more effective order consolidation. This common order fulfillment process drives greater picking efficiency, yet requires a system with a large number of sort destinations in a limited space. This plays to the strengths of loop sortation technology in which individual load carriers receive items from multiple input points. The items continuously recirculate while awaiting other picks required by the same order to arrive prior to pack-out. Depending on the deployed technology, load discharge occurs in a variety of ways: · A bomb bay sorter has carriers with two surface halves that drop open from below. · Tilt-trays tip to one side or the other. · Push-trays are equipped with a mechanism that pushes the load off the surface. · Cross-belt carriers have a short section of motorized belt conveyor oriented perpendicularly to the sorter’s travel direction that propels the item off to the side. The other common sortation application is the routing of order packages to different shipping trailers based on service level agreements or carrier arrangements. This type of workflow transports orders from pack-out to shipping, then diverts the items to different destinations at the outbound dock. To efficiently accommodate a high number of destination locations, outbound sortation usually uses line sorters that travel in a straight line with a single induction point. As directed by an automatic identification technology such as a barcode scanner or imager, items are
pushed, diverted or deflected off the sorter’s path at appropriate points by means of a mechanical arm or other in-line device. Common line sorter technologies include sliding shoe, motor-driven roller transfers and diverts, strip belt transfer, pop-up wheel belt, pop-up wheel strip belt or sweeper sorters. 3. Establish desired throughput rate. With high e-commerce order volumes putting stress on the capacity of existing systems, knowing an operation’s throughput rates at both standard and peak periods is integral. Throughput rates can fuel return on investment calculations, as well as provide room for operations to scale for the future.
STRATEGIES TO GET SORTATION SYSTEMS ONLINE QUICKLY Getting an automated sortation system up and running fast depends on a variety of factors, some of which can be controlled by the end user and some of which cannot. Today’s e-commerce-driven supply chains have little margin (or time) for error. To ensure the successful design and implementation of an innovative sortation package that meets your specific operational goals, partner with an experienced provider who has access to— and experience with— integrating a full lineup of sortation Ho technologies. n ey
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SPECIAL REPORT PROCUREMENT
By Chris Haydon, president of SAP Procurement Solutions
THE
supply chain and procurement business advocated for the need to be prepared for disruption, evangelizing the need for visibility into second- and thirdtier suppliers, honing in on the importance of constantly evaluating risks and how to navigate quick changes in supplier operations. Whether natural disasters, economic instability or global shutdown, there is and has always been a constant need to ensure an efficient supplier risk strategy for whatever disruption is just around the corner. Being risk-averse means always remembering that connections can be disconnected at any moment. Therefore, companies must have the resources and technologies to just as quickly pivot to new sources of supply. This means ensuring constant and accurate visibility into supply chains and business ecosystems to detect potential threats or exposures to all types of spend–direct, indirect, workforce,
EMPOWERED ROLE OF
PROCUREMENT IN A
NEW REALITY
N
o company is immune to disruption. Whether it’s coming from a nimble competitor disrupting your business model, a new technology making an older one obsolete, or a global pandemic sending businesses from startups to Fortune 50s into a tailspin, one thing is clear—disruption has become the new reality. To prepare for disruption, businesses need to be able to shift at a moment’s notice. Agility plus a willingness to change and re-evaluate supply chain and procurement strategies is imperative. Companies’ procurement functions will be in the spotlight to manage complexities and mitigate the risks caused by this new reality. This accelerated pace of change requires the industry to re-think processes, technology and partner relationships to stay focused on driving business outcomes.
MITIGATE SUPPLY CHAIN RISKS Long before the pandemic struck, many professionals in the
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maintenance, repair and services. Technologies such as artificial intelligence (AI), machine learning and predictive analytics can enable this, with real-time monitoring and alerts to potential risk factors before they happen. Once risk is identified, companies can then turn to a network of alternative suppliers to swiftly make decisions and changes before supply chain operations are slowed or impacted. Amidst the current Coronavirus disease (COVID-19) pandemic, many businesses have experienced firsthand the devastation when supply chains are not adequately prepared to adapt. Toilet paper and disinfectant manufacturers have scrambled to keep up with demand. For many companies, they’ve needed to shift from a global sourcing strategy to a local one. When your relationship with a foreign produce supplier wavers, what better time to explore local alternatives just down the street.
AUTOMATE AND ELIMINATE INEFFICIENCIES There’s a popular saying in the business world— innovate or die. While dramatic it may
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be, it’s never been more relevant than it is today. The current business climate has no patience for bureaucratic siloes or processes that slow down operations and decision making. Agility and the willingness to shift business processes on a dime have proven to be more valuable than anyone could have imagined. It takes courage to change. But, its value cannot be undermined, and when disruption hits, those laggards suffer the most harmful effects. To avoid these pitfalls, supply chain and procurement professionals need to automate manual processes, eliminate redundant or unnecessary
barriers and adopt a datadriven mindset. A first step is breaking down siloes to enable a full, holistic view of spend and supplier relationships. Technology helps companies automatically collect data from across all departments in the organization, using AI to identify patterns and derive intelligent insights. As we navigate this pandemic, businesses must be fluid and agile. You can’t operate in crisis mode all the time, but you can adopt this mindset into how you run your business. Then the next time a crisis hits, you can adapt in a more responsive way.
UNLOCK THE POWER OF COMMUNITY INTELLIGENCE Never in our professional lives has it been more critical to not go it alone. We are all connected and dependent on each other’s success—buyers do not succeed without their suppliers and vice versa. We rely on the ecosystems outside our own walls. Supplier relationships and business partnerships mean more now than ever, as does collaboration. We need to increase collaboration with all trading partners, enabling opportunities for meaningful engagements and thoughtful conversations to ensure expectations are aligned. By increasing real-time visibility and collaboration throughout the supply chain, we build off each other’s successes.
Vecna Robotics is the autonomous mobile robot (AMR) company that helps distribution, warehousing, and manufacturing organizations streamline their materials handling and logistics operations.
Pivotal™, our proprietary orchestration engine, integrates with existing warehouse management systems for a coordinated approach that maximizes throughput, operational efficiency, and human and robot collaboration. Our robots are backed with 24/7 US-based live support and proactive monitoring for an industry-leading 99%+ uptime. vecnarobotics.com | 617.444.9263 | team@vecnarobotics.com
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EXECUTIVE FOCUS
TRANSPORTATION
By Jim Monkmeyer, president of transportation, DHL Supply Chain, North America
DRIVING CHANGE: THREE WAYS 3PLS CAN ADDRESS TRANSPORTATION CHALLENGES
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drive down total logistics costs. Lastly, consistent customer service must be delivered by professional and trained drivers that know how to safely handle and deliver your customer’s freight. 2. Transportation management. Transportation management systems (TMS) help companies optimize and control their shipping process and still reduce costs. By outsourcing and centralizing the transportation functions of an operation to a 3PL, shipping needs can be more efficiently and easily matched with the right carriers and routes. 3PLs can manage the entire process, matching shipping needs and volume with network carriers that have the capacity to handle the shipment. Most 3PLs have invested in TMS and other tools that automate and optimize otherwise manual processes, eliminating paper while spreading the technology investment across many shippers. Using a 3PL to handle transportation management also
allows companies to take advantage of the provider’s buying power and ability to quickly scale to meet needs. Look for a 3PL that has a broad network of carriers and the scale and procurement tools to negotiate favorable rates. 3. Lead logistics partner. For those companies looking to revolutionize their supply chain, look for a 3PL who offers a lead logistics partner solution. These providers will take a holistic view of what’s happening with transportation and make broad, informed changes that have big benefits for supply chain performance. This approach allows 3PLs to also bring sophisticated network design, continuous optimization and strategic, long-term planning to the supply chain. For a successful partnership that delivers on measurable, obtainable goals, the logistics provider needs to be a fit for your supply chain operation and provide real value to the business.
DHL
s companies expand or evolve, many find they can no longer go it alone to overcome today’s transportation challenges. It can also be difficult to think beyond today’s shipment and prepare for future market challenges and digitalization. That’s where third-party logistics (3PL) providers can help. 3PLs offer a variety of transportation capabilities and services that provide shippers predictability, capacity and flexibility. But, how do companies choose the right type of 3PL? Here are three transportation services 3PLs can provide: 1. Dedicated fleet. For those companies that have a certain amount of consistency and uniformity in their shipping needs and complexity in their pick-up or delivery requirements, choosing a 3PL that offers dedicated fleet solutions may be essential. These factors include the ability to design the size and scope of the fleet to meet the service and capacity requirements that align with an overall transportation network strategy, perform dynamic route optimization to ensure high levels of customer service and fleet utilization and incorporate backhauls and complementary freight to lower cost. Additionally, the capability to integrate and synchronize fleet operations with other 3PL crossdock or warehouse solutions can
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EXECUTIVE FOCUS
WAREHOUSING
By Michelle Comerford, industrial and supply chain practice leader, Biggins Lacy Shapiro & Co.
Biggins Lacy Shapiro & Co.
Here’s how to approach site selection of a U.S. facility, as businesses move to shore up supply chains.
IN THE AGE OF A GLOBAL PANDEMIC
T
current trade policies and a potential fracturing of export capacity. An effective U.S. site not only minimizes risk, but also reaches customers faster, improves quality control and introduces new products to the market. So, how should a company approach its search for the right U.S. location?
he business disruptions caused by the Coronavirus disease (COVID-19) have certainly left many companies rethinking their supply chain and manufacturing strategies. Given the implications of COVID-19, a familiar solution has resurfaced— the idea of “reshoring,” or bringing manufacturing back to the United
WHEN CONSIDERING LOCAL MATERIALS AND SUPPLIERS TO AUGMENT A NEW OPERATION, THERE ARE VARIOUS RESOURCES AVAILABLE TO HELP IDENTIFY POTENTIAL U.S. PARTNERS.
States. These efforts are expected to accelerate in the near term, particularly for products destined for the U.S. market. This is especially true as U.S. officials seek to reduce dependence on Chinese supplies, given the virus’ impact on the country,
COMPLEX PROPOSITION To be clear, reshoring is a complex proposition. Traditionally, the business case has been centered around a comparison of manufacturing costs per unit, and with low labor rates found in Asia, it has been difficult to justify U.S. production for some. More
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recently, disruption caused by the virus, along with other factors (e.g., the ability to automate production operations, increasing tariffs on imports and concerns over intellectual property protection) have signaled a change. This complexity has made tools such as the Total Cost of Ownership (TCO) calculator from the Reshoring Initiative a vital part of the discussion. This tool helps companies compare pure manufacturing costs, along with additional factors, resulting in a true total cost of doing business in the United States vs. China (and other countries). It also helps prevent 2030% miscalculations of this equation. In many cases, the results are quite favorable to the United States, particularly for companies that serve the American market. These operations may see a reduction in costs for transportation, utilities and other operational risk factors, and may also see an increase in sales attributed to products with a “Made in the USA” label.
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ACQUIRE THE PROPERTY AND BEGIN DETAILED ENGINEERING AND CONSTRUCTION OF THE FACILITY.
PLANNING THE SITE SELECTION PROCESS Once the decision is made to reshore, how can a company find the right location? Selecting the right location for a U.S. operation is a multifaceted process. It is critical to have step-bystep knowledge of the stakeholders, regulators and other information used in the decision-making process. This helps ensure that nothing is missed that may otherwise cost time and money. Every project is unique, and as such, requires a deliberate, rigorous evaluation that incorporates operating environments and total costs. The location must also meet the company’s current and future needs.
DEFINE THE OPERATION’S SCOPE Before beginning to evaluate location options, it is important to first “define” the proposed operation and its many associated requirements. This allows you to properly evaluate location opportunities against these needs. For a manufacturing plant, the production process and equipment should be planned with a process engineer. Be aware that the U.S. version of the plant will likely be more automated than its foreign counterpart. Define the plant “inputs,” including 30
suppliers, transportation, labor, real estate, utilities and other location factors such as community preferences, accessibility, etc. For example, when considering local materials and suppliers to augment a new operation, there are various resources available to help identify potential U.S. partners. Other industry trade groups also publish online supplier directories searchable by city and state. Then, calculate the project investment and identify the desired timeline to begin operations. Biggins Lacy Shapiro & Co.
THE FINAL STEP IS TO
TAP INTO SITE SELECTION RESOURCES There are many resources available to assist with site selection. Economic development agencies, for instance, operate at the state, local and regional levels and have a responsibility to attract and retain business investment and jobs to their respective communities. They can be excellent initial resources of preliminary information at no cost and are the point of entry for economic development incentives, such as grants, property tax
abatement, corporate income tax reductions and training assistance. Reshoring projects will typically find a particularly warm welcome, as they resonate with the general public’s sense of patriotism. However, be aware that each economic development entity is representing their respective area only and will not necessarily be an objective source of information. A professional site selection consultant, on the other hand, assists companies in formulating a site selection process and executing a strategy through data collection, analysis and field work. Most site selection consultants work closely with economic development agencies and utilize data services and other tools to evaluate available locations and incentives through an established methodology. A site selection consultant engaged by a company will work on behalf of that company’s interest to help guide the search methodology. They work in an objective fashion across jurisdictional
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e
WAREHOUSING
number of jobs created and wage levels for the new jobs.
boundaries, weighing various operational factors in the process. This results in an effective final location decision. The key is to engage these professionals early in the process. They can provide the most value when brought in during the conceptual phase of the project, facilitating a streamlined decisionmaking process and guiding the company through, ultimately saving significant time and money.
PLANNING AND EXECUTION Overall, an efficient site selection process is truly more of a site “elimination� process. Location screening and scoring criteria, beginning with highlevel considerations and then evolving into site-specific considerations, will guide you through a progressively shorter and shorter list of potential locations. If your process is not deliberate, you will become mired in an overabundance of information and conflicting priorities; if not rigorous, your decision may not withstand the test of time and markets. If, however, you achieve both, you will find the optimal location and reap the financial and operational benefits. The final step is to acquire the property and begin detailed engineering and construction of the facility. Keep in mind that many construction timelines may also be 12-18 months or more, depending on the type of operation and the location.
PROJECT FINANCING AND INCENTIVES Prior to the COVID-19 crisis, most states and local communities offered financing and incentives programs, however many of these programs may be affected in the near term by government budget shortfalls resulting from economic shutdowns. Even prior to the crisis, these programs were generally not designed to fund 100% of a project, so each company will need to be prepared with project financing sources, whether through internal means or outside investors. Having a firm understanding of any funding gaps will be important to incentive discussions with the finalist locations in the search process. Other types of incentives programs, including grants, tax credits and abatements may also be available depending on the states and local communities under consideration (and their post-COVID-19 plan). These are typically awarded based on the amount of capital investment,
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LONG-TERM SUCCESS Faced with an unprecedented disruption event like COVID-19, the current climate demands swift action. With a renewed call for U.S. production, the opportunity for new innovative manufacturing processes and rapidly increasing consumer demand, the time is right to consider reshoring operations to the United States. Tapping into resources and engaging the assistance of outside professionals will ensure a well-guided and efficient decision-making process and implementation plan.
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EXECUTIVE FOCUS
SOFTWARE & TECHNOLOGY
By Mike Eisner, vice president of business intelligence and data analytics, Logistyx Technologies
SUPPLY CHAIN ANALYTICS PLANNING FOR
PANDEMIC RECOVERY
A
s the globe responds to the Coronavirus disease (COVID-19) pandemic, for retailers, it has resulted in the largest supply chain disruption so far. For others positioned with decision-making insights and supply chain flexibility to respond geographically across continents, countries and regions, their response to the pandemic has entrenched their brand position of competitive strength and reliability. While the initial news of the pandemic from Wuhan seems a distant memory, it is still an event counted in weeks. Chinese factories and markets closing (and the subsequent South Korean spread) as a response to the virus were clear supply chain indicators requiring timely action. Nowhere was this more obvious than in the retail e-commerce (omnichannel) landscape. Global retailers with strong business intelligence practices leveraging predictive and prescriptive analytics quickly received insights to respond and adapt as geographies and customers were impacted. 32
Getty Images
Prescriptive analytics helps guide organizations’ supply chain decisionmaking. As entire countries and regions close down business activities, omnichannel retailers were forced to respond or face the consequences. A retailer’s ability to make inventory available or shift into viable locations where workers could safely fulfill orders with transportation providers ready to pick up and reliably deliver to end consumers has been critical to their success. Even the rate of adoption of curbside pickup as a buy-onlinepickup-in-store (BOPIS) evolution required thought and planning for retailers, as competing employee resources shift within the changing consumer retail vs. e-commerce model. Otherwise, if retailers were too late or inflexible to respond, they became handcuffed, had inventory shortages and were unable to meet customer requirements. Let’s not forget the variables going into these decisions are changing by the day, just like they will on the back end in recovery.
THE BUILDING BLOCKS WERE THERE It’s no wonder successful retail organizations have strong business intelligence and analytics departments. There are many data points captured for decision-making, and the prevalence of cloud-based supply chain software and applications have enhanced their abilities. If we focus on the e-commerce segment and the movement of goods from point of pick up to end-consumer receipt, the data points for clear decision making
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become more obvious. Typical data points for supply chain transportation analytics include the following: · Historical shipping data – inbound and outbound · Carrier delivery status (visibility/ performance) · Carrier contracts · Carrier invoice data (actual cost) · Warehouse management software (WMS) inventory (location) availability Augmenting this during the pandemic within a retail omnichannel model, one would need to understand distribution point availability, shifting supplier sourcing, employee resourcing and additive order shift planning into e-commerce or BOPIS from buy-instore expectations as stores closed or consumer behavior adjusted to avoid retail locations. To accommodate, retailers use order management and WMS to augment these supply chain data points. Use of these data points in a suitable data storage model allows for business intelligence and prescriptive analytics to support decision-making to properly plan what inventory to have available, where and when to leverage which carrier(s) and delivery option programs to fulfill customer orders and expectations at the least
cost. These capabilities can make even the most demanding situations more manageable. A large U.S. telcommunications company, for example, needed to launch a new handheld mobile device into the U.S. market expected to be delivered the last week of April, leveraging their omnichannel capabilities. Talk about a tall order at the peak of a U.S. pandemic. With the ability to rate shop and execute deliveries with multiple carriers at each location throughout the omnichannel organization, the company called on all of its locations that were still open or available to fulfill allocated orders (less than one-third of their total U.S. retail store locations) and its relatively uncertain workforce. Planning for the effort, the company quickly shifted inventory appropriately to identified valid locations. To execute, it chose among the available carrier options to manage tens of thousands of deliveries. Track-and-trace capabilities provided transparency for customers and visibility for teams to ensure products reached expectant consumers’ hands on time, for the most part. The company’s ability to understand the results of where and when to move inventory to allocate against orders with known delivery lead times and transportation cost impacts prior to distribution and with flexibility to adjust when employee resourcing constraints occurred was vital to this release program.
ACCOUNT FOR THE UNPLANNED
Logistyx Health Check
Managing supply chain performance is difficult during normal times. During the pandemic though, key input variables usually taken for granted have changed. Without the right tools to accommodate these additive impacts from a data perspective,
decision-making insights can become incorrectly biased and useless. To account for this, progressive organizations can use a properly designed data storage model, ETL processing of data obtainment with additive transformation, optimization capabilities and tools to support requirements such as machine learning, artificial intelligence, spatial analysis, etc., with visualization tools to meet their objectives. The pandemic provides perfect examples of unforeseen variables affecting supply chains. Governmentmandated business closures and work stoppages have affected entire countries, regions, cities, suppliers and industries. Airlines adapted by converting passenger seating into cargo holds to offset the increased capacity demand for expedited movements. Lists of countries preventing international carrier movements from certain origins change daily. What’s more is, major carriers have introduced temporary peak surcharges and suspended certain service guarantees to safely manage increased volume. Effective analytics must account for these variables within the broader tool set to predict and prescribe the best course of action to minimize customer impacts and keep costs in check.
TURN TO THE EXPERTS The speed with which retailers had to respond to an evolving supply chain, disrupted retail model and enhanced e-commerce consumer demands during the pandemic forces many retailers to reflect on the systems used to support their business. Implementation of a global, flexible, multiple carrier parcel platform to support consumer fulfillment requirements is critical. The path back to normal will be bumpy; plan for the unexpected.
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EXECUTIVE FOCUS
SOFTWARE & TECHNOLOGY
By John Flynn, CEO, Fleet Advantage
PREDICTIVE MODELING
FOR TRANSPORTATION FLEET EXECUTIVES
O
ne of the most challenging aspects of the supply chain is the ability to look ahead and forecast supply, demand and future transportation needs. The days of making decisions based purely on historical patterns and instincts are well into the past. Data and analytics are now deeply entrenched into the planning and execution phases of any supply chain, and the challenges with the Coronavirus disease (COVID-19) has made this even more critical.
HISTORICAL PATTERNS FORECAST FUTURE DECISIONS Predictive data leverages science and analytical trends to create algorithms and formulas that combine economic insights along with data mining trends to arrive at a forecasted output scrutinized for more accurate logistics planning. When making critical business decisions, predictive modeling can be extremely beneficial in helping fleet executives leverage past and present data. Today, organizations use predictive modeling to help forecast what Fleet Advantage calls the TIPPINGPOINT (the point at which it makes more financial sense to replace an aging trucking with newer, more efficient models) by looking into the future and selecting specific dates to gain visibility into the future life-cycle performance and replacement economics of each truck. Fleets can analyze any number
of criteria, including truck make, model and type, as well as utilization characteristics such as usage location and fuel metrics. This critical insight helps predict the savings over the next 1-3 years and shows where unit replacements would present operational cost savings over the predicted time allotment during that time span.
HOW TO LEVERAGE DATA The closing of retail outlets and increased demand for e-commerce means that supply chain routes and typical business patterns have shifted. As a result, transportation fleets must leverage truck utilization data, load percent capacity, driver wellness and other KPIs to monitor the efficiency and optimization of each unit. While it’s important to take an “all-hands-on-deck” approach to help deliver goods and items promptly, fleets need to keep an eye on truck utilization to maintain the right lifecycle management of each unit in the long term. Additionally, it is essential to have advanced data feed capabilities that upload in real-time compared with backward-looking data that only looks at the previous month’s data to manage mileage, miles per gallon, idle time, routing and driver hours.
KEEPING BUDGETS IN LINE The ability to arrive at more accurate business outcomes helps create more targeted budget scenarios. Predictive modeling allows transportation fleets to create future business insights with a significant degree of accuracy. With the help of sophisticated data analytics tools and modeling, these firms can now use past and current project utilization data to reliably forecast budget trends milliseconds, days, or years into the future.
INCREASING DECISION ACCURACY Data and analytics have enabled organizations to streamline their businesses and create efficiencies never before realized. What’s more is, this advanced level of business intelligence helps organizations navigate through unprecedented circumstances such as what is being felt with COVID-19. Companies with transportation fleets that leverage predictive modeling technology will increase their bottomline efficiencies even further and amplify their competitive advantage post-pandemic.
Fleet Advantage
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EXECUTIVE FOCUS
PROFESSIONAL DEVELOPMENT
By Tisha Danehl, vice president of Ajilon
HOW TO ADVANCE YOUR SUPPLY CHAIN THROUGH
MENTORSHIP When people think of a mentorship program, they often think of one-on-one mentoring, but that’s not the only option available.
U
ntil a few years ago, supply chain jobs were filled by employees who had effectively worked their way up through the company, from the warehouse floor to a supervisory or management role, and who unexpectedly found themselves in one of the most important positions within their organizations. Today, the environment is much different. Universities and colleges have enhanced their supply chain and logistics degree programs to help shape the next generation of managerial talent for this industry. Organizations have expanded their certification programs and employers have come to understand the true value of having an end-to-end supply chain that functions. While finding and retaining top talent is essential to every supply chain, when it comes to investing in their existing workforce, many organizations
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fall short. That’s why companies must look within their organization to identify potential leaders and further develop their skills. One of the most effective ways to do this is by offering a mentorship program. Cost effective and easy to structure around your business’ needs, mentorship programs offer a great opportunity to train employees today for the jobs needed tomorrow. They also offer unexpected benefits to both mentees and mentors, such as workplace satisfaction.
HOW TO ESTABLISH A MENTORSHIP PROGRAM FOR THE SUPPLY CHAIN INDUSTRY Before starting a mentorship program, there are a few planning steps to take:
1. Establish program objective and guidelines It’s important to establish the main goals of the mentorship program, so you can structure it around the organization’s most important objectives. For example, a program focused on employee retention will look different than one centered around leadership training. Once goals are established, it’s also important to establish
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guidelines and expectations of both mentors and mentees. Outlining time and commitment, meeting cadences and processes can help avoid confusion among employees while ensuring needs are met.
2. Pick a program format When people think of a mentorship program, they often think of one-onone mentoring, but that’s not the only option available. One-on-one is the most common form of mentorship programs and offers the potential to develop a deeper trust and working relationship between participants, with the mentor and mentee often becoming career-long confidants. However, the idea of team-based mentorship groups has recently gained popularity. While one-on-one mentorship helps to further develop one relationship, group mentorship fosters the spirit of collaboration and brainstorming among a group of employees. The group format lessens the demand needed from mentors and allows workers to still invest in mentorship, while also pursuing their own projects. With the recent influx in remote workers, companies now have an opportunity to leverage this newfound flexibility to develop a remote mentorship program and maintain workplace culture in a time of social distancing. The elimination of physical offices offers companies the opportunity to consider online mentoring programs where they can match employees with mentors who might not have been based in the same office location.
3. Test the waters Be sure to conduct research to determine which model is the best fit for your employees and organization. 36
Facilitate internal surveys to determine what the needs are and if employees would be interested in a formalized mentorship program. Companies may find it helpful to first run a few mentorship test pilots before expanding the program across the workforce to see which format is most effective. For one-on-one mentorships, it’s sensible to start out informally and decide whether the other’s style and approach of mentoring matches with yours before taking them on as a longer-term mentee/mentor.
4. Measure results There are many ways to measure results. You’re going to want a method that most accurately reflects the initial objectives and goals of the program. For instance, if the goal is to increase employee morale or workplace culture, verbal feedback might provide higher quality feedback than a 5-question survey. Similarly, if the objective of the mentorship program is on-the-job learning of a particular technology or skill, using a software system to track progress might give a clearer sense of results.
RECRUITING FUTURE WORKFORCE Engaging with the next generation of workers is easier than ever before. Nowadays, supply chain and logistics positions exist in nearly every industry, across the globe—from jobs at small firms all the way up to Fortune 500 companies. Companies can take advantage of the field’s recent growth by partnering with universities that have the type of supply chain degree programs that align best with their entry-level job requirements, company values and culture. Establish
rapport with potential new hires by having members of your team attend university job fairs and maintain relationships with their alma mater’s career centers and use the time to highlight opportunities for mentorship and career development. This generation of graduates is more concerned about career trajectory than past generations. Among the Gen Z and Millennial workers age 18-24, a CNBC/ SurveyMonkey Workplace Happiness Survey reports nearly a quarter (24%) of respondents say having opportunities to advance is the most important factor in their overall happiness at work.
BENEFITS FOR ALL Mentorship programs benefit all those involved, not just the mentee. Of course, the mentee is being offered the attractive opportunity to learn and further develop their skills at no cost to them. But, this also helps the organization boost employee morale and get their employees to think about their long-term career with the company. According to respondents of the same survey, 71% of employees with a mentor say their company provides them with excellent or good opportunities to advance their career, while just 47% of those without a mentor say the same. Programs like these also serve as a platform for companies to invest in the future of their organization, offering the mentor the opportunity to learn through teaching and hone their management skills, so that they can progress to manage a larger team. It’s also a great way to get honest feedback from employees about leadership’s strong points and shortcomings as part of performance review systems.
SUPPLY & DEMAND CHAIN EXECUTIVE | June 2020 | www.SDCExec.com
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WORK HARD, By Mackenna Moralez
READY, SET, GO
HOW DRAG RACING RELATES TO THE SUPPLY CHAIN
S “
tart your engines,” is a phrase that has made many hearts drum with anticipation. But, for supply chain veteran John Conte, it signals the start of a new drag race. Conte first started drag racing when he was just 17 years old, when car culture thrived in the Philadelphia/ South Jersey region. He explains that whenever he saw someone driving a BMW, Audi or Porsche, he would walk over and introduce himself to the driver and ask questions about the particular vehicle. “I was always interested in cars that were low, loud and fast,” he says. “I loved how someone could take a modest car and make it faster than a traditionally more expensive vehicle. The competitive nature of the sport hooked me, but it’s all about continuous improvement and being better than you were the last time.” He credits the sport for helping him become a hard worker and appreciate what he has. In addition, it inspired him to work harder to achieve these goals. “When I would talk to the owners, I was able to hear stories of both success and failure, and how they bounced back from setbacks,” says Conte. “I have carried those stories with me throughout my life.” Despite what some may think about drag racing, it allowed Conte to be
innovative early on. When he first started the sport as a teenager, parts were expensive, so he learned how to make other parts work within the car and network with other drivers to procure materials in a more costeffective manner. He explains that barter and trading are key tools in the process, helping him gain skills that he would later use in the supply chain and logistics industry. “From the parts side of things, it relates heavily to supply chain and logistics. Parts are ordered mostly just in time. This means the part is needed now and could be vital to the completion of a project or to get a vehicle repaired,” Conte says. “Reverse logistics also plays a big role because the broken part will need to be returned for remanufacturing processes. Procurement and strategic sourcing are applied to make sure the best price is achieved, and data and analytics are utilized to make decisions and changes to optimize the vehicle and driver setup.
Think about a telematics device, but instead of being used for route optimization, it’s optimizing for performance.” Just like the supply chain, drag race calls for continuous improvement and education. He suggests researching the different types of cars, races and events in addition to just observing in the stands. Conte also explains how what works for one vehicle may not work for another, so you have to learn the car to completely understand its technology and track. “I am still learning. Technology changes so rapidly that each car and part are very different. For the basics, it took me one summer, but you need to practice often to get your rhythm down,” says Conte. “It’s an evolution, and you have to be willing to change with the technology or you will be left in the dust.”
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www.SDCExec.com | June 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE
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It takes more than sound technology and know how to plan and realize the best logistics systems.
For every task, the right solution WITRON‘s storage systems offer a cost-efficient and ergonomic solution for every application across all industries regardless of the branch, whether it is handling large-volume or small-volume articles, whether the article range is small, broad, or inhomogeneous, whether maximum dynamics is required, or a continuous work process is needed. It doesn‘t matter if the products are picked into totes or cartons, onto trays, pallets, or roll containers, or other dispatch units. All warehouse solutions – whether highly automated, semi-automated, or manual – are modular and based on standardized system components.
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About WITRON Since 1971, WITRON Integrated Logistics designs, realizes and operates customized logistics and material flow systems that generate sustainable competitive advantages for its clients. WITRON has all the decisive key elements of a successful project under one roof: logistics design, information and control technology, mechanics design and production, as well as functional responsibility as general contractor for logistics. The WITRON Corporate Group has 3,100 employees worldwide. WITRON’s annual revenue in 2017 amounted to 635 million USD. Aside from it’s headquarters in Parkstein, Germany, WITRON has offices in Arlington Heights, Illinois (USA), Toronto (Canada), Venray (The Netherlands), Stoke-on-Trent (UK), Madrid (Spain), Strasbourg (France), and Singapore. WITRON Integrated Logistics, Inc. 3721 Ventura Drive Arlington Heights, IL 60004 Phone: +1 847-385-6000 info@witron.com
www.witron.com
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Find all facts and features about our logistics systems under www.witron.com
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