Supply & Demand Chain Executive June 2018

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100 GREAT SUPPLY CHAIN PROJECTS This year’s Supply & Demand Chain Executive (SDCE) 100 highlights supply chain solution and service providers that are working with small, medium and large enterprises to transform their supply chains and deliver value to the bottom line. These leaders are helping their customers meet the challenges of the new normal— and laying the framework for successful supply chain transformation.

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June 2018 | Volume 19 | Issue 3

CONTENTS FEATURE

08

08 AI’s Predictive Insights Will Drive Greater Cost Savings

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Companies are looking to artificial intelligence as the pressure to create a more agile supply chain while driving down costs heats up.

14 Driving Toward the Path of Success

Innovative ideas and solutions to guide industry leaders in maximum efficiency, profitability and more.

24

24 Spend’s Role in Industry 4.0

With businesses that are ready to listen, Industry 4.0 will offer massive insights about the supply chain and its demand-side to provide new benchmarks for efficiency and value.

28 CSR in an

Interconnected World

As the world continues to become more connected, companies are starting to realize the benefits they receive from becoming more socially responsible.

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SDCEXEC.COM Defining and Driving Innovation in an Invisible Industry

www.sdcexec.com/21007436

Maker Finds Success

Mass customization and warehouse design services contribute to a winning strategy for Combilift and its customers, who are looking for alternatives to traditional design and manufacturing practices.

SPECIAL REPORTS

39 THE INTERNET OF THINGS Sensing the Supply Chain

While barcodes and QR codes are still widely used as sensors in the supply chain, it’s the need for analytics and predictive data that’s driving an evolution in sensor technology and usage.

36 PROCUREMENT A Road Map to Success

With the right strategy in place, procurement can add business value in ways we’ve yet to see.

42 BLOCKCHAIN Obstacles for Blockchain Adoption

Blockchain is here and meaningful applications using this revolutionary technology are on their way.

Exclusive online features and solutions for successful supply chain operations

Supply Chain Orchestration Can Mitigate Trade War Disruption www.sdcexec.com/21008262

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32 Global Forklift

Automation: The Key to the Labor Shortage Problem

www.sdcexec.com/21008296

EXECUTIVE FOCUS

44 T RANSPORTATION Values Lies in 3PL

The Amazon Effect, technology, the internet and consumer expectations are driving collaboration between shippers and 3PLs.

46 WAREHOUSING

California’s Industrial RealEstate Market Stays Hot

E-commerce, cannabis and strong activity at gateway ports drive continued growth.

48 SOFTWARE &

TECH Analytics: Changing the Speed of Supply Chain Analytics are the key to transforming data into actionable insights that accelerate your business forward.

50 PROFESSIONAL

DEVELOPMENT Does E-learning Really Work?

Companies are looking toward eLearning as a necessary training tool, but does it actually work?

COLUMNS

04 EXECUTIVE MEMO 22 MADE IN AMERICA 51 WORK HARD,

PLAY HARD

SDCExec.com | June 2018 | SUPPLY & DEMAND CHAIN EXECUTIVE

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EXECUTIVE MEMO

By John R. Yuva, Editor jyuva@ACBusinessMedia.com

FIND YOUR MUSE with SDCE 100 Our SDCE 100 award recipients represent the leading innovators in supply chain.

H

ere we are in June, with technology. “Emerging technologies half of 2018 already in the such as artificial intelligence and books. In our third issue machine learning promise to help of the year, we have an companies improve data classification and eclectic mix of articles. Everything from recognition, yielding a new understanding supply chain sensor usage to corporate of relationships between disparate sets social responsibility trends to what makes of data and helping organizations make a successful procurement faster, more profitable business AS MORE strategy encompass our pages. decisions. A sizeable percentage ORGANIZATIONS of procurement organizations Our coverage also extends to California’s industrial real- EMBRACE THE DIGITAL are now piloting emerging TRANSFORMATION technologies.” estate market and an Irelandbased forklift manufacturer However, The Hackett THAT’S OCCURRING, that takes design and Group says the promise of ENTIRE SUPPLY manufacturing to new levels.

CHAINS CAN REAP that innovation requires It’s also that time of year for THE BENEFITS OF organizations to have the our SDCE 100, a spotlight on WHAT EMERGING appropriate talent and resources the industry’s most successful TECHNOLOGIES CAN to leverage the technology. and transformative projects.

“Last year, procurement PROVIDE. This month’s cover story on leaders told us that digital artificial intelligence (AI) provides an intransformation was a priority, but most depth look at the possibilities technology simply didn’t have the strategy and can bring to supply chain operations. resources in place to move forward,” Whether it’s streamlining processes, says Chris Sawchuk, The Hackett improving transparency or building Group Principal & Global Procurement analytical capabilities, AI is about bringing Advisory Practice Leader. “This year, that critical data to the forefront, creating gap has closed significantly. Momentum visibility to what was once invisible. is growing. More organizations are IBM’s Jeanette Barlow, vice president planning for digital transformation and strategy and offering management, supply more are in a position to do something chain solutions, IBM Watson Customer about it. But a significant number of Engagement, says, “The emerging companies have not gotten there yet, and technology is meant to provide users with digital transformation has the potential answers, options and solutions, which the to be such a game changer that these user can then use to make the best possible procurement organizations are at risk.” decision and take action.”

As more organizations embrace the According to The Hackett Group’s digital transformation that’s occurring, latest Key Issues Study, The CPO Agenda: entire supply chains can reap the benefits of Expanding Procurement’s Influence what emerging technologies can provide.

Through Change and Innovation, 31 Happy reading! percent of organizations are piloting cognitive computing/artificial intelligence 4

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2018 | SDCExec.com

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Published by AC Business Media Inc. 201 N. Main Street, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com

www.SDCExec.com PRINT AND DIGITAL STAFF GROUP PUBLISHER Jolene Gulley ASSOCIATE PUBLISHER Judy Welp EDITORIAL DIRECTOR Lara L. Sowinski EDITOR John R. Yuva ASSISTANT EDITOR Amy Wunderlin WEB AND COPY EDITOR Mackenna Moralez CONTRIBUTING EDITOR Barry Hochfelder SENIOR PRODUCTION MANAGER Cindy Rusch ART DIRECTOR Kayla Brown AUDIENCE DEVELOPMENT DIRECTOR Wendy Chady AUDIENCE DEVELOPMENT MANAGER Angela Franks ADVERTISING SALES (800) 538-5544 JOLENE GULLEY, jgulley@ACBusinessMedia.com SHEILA SPINCK, sspinck@ACBusinessMedia.com EDITORIAL ADVISORY BOARD LORA CECERE, Founder and CEO, Supply Chain Insights TIM FEEMSTER, President, Foremost Quality Logistics JOHN M. HILL, Director, St. Onge Company, and Board of Governors, Material Handling Industry of America RORY KING, Analytic and Big Data Advisor, SAS Institute KAREN MASTER, Vice President of Communications, SAP Ariba WILLIAM L. MICHELS, CEO, Aripart Consulting JULIE MURPHREE, Founding Editor, Supply & Demand Chain Executive ANDREW K. REESE, Senior Portfolio Marketing Manager, IHS, and Former Editor, Supply & Demand Chain Executive BOB RUDZKI, President, Greybeard Advisors CHRIS SAWCHUK, Global Managing Director and Procurement Advisory Practice Leader, The Hackett Group RAJ SHARMA, CEO, Censeo Consulting Group KATE VITASEK, Founder, Supply Chain Visions 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 JOLENE GULLEY, jgulley@ACBusinessMedia.com AC BUSINESS MEDIA INC. CHAIRMAN Anil Narang PRESIDENT AND CEO Carl Wistreich CFO JoAnn Breuchel DIGITAL OPERATIONS MANAGER Nick Raether DIGITAL SALES MANAGER Monique Terrazas Published and copyrighted 2018 by AC Business Media Inc. 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 five times a year: March, May, June, September and December by AC Business Media Inc., 201 N. Main Street, 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. Return undeliverable Canadian addresses to: Supply & Demand Chain Executive, P.O. Box 25542, London, ON N6C 6B2.

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June 2018 / Volume 19 / Issue 3

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Smart has a new home – your warehouse.

On the outside, a smart warehouse looks like any other building. On the inside, autonomous vehicles, drones, sensors, and wearables are creating a more intelligent supply chain that has 100% real-time visibility, complete flexibility, and lower operating costs. At Ryder, we’re using these technologies to build smart warehouses that drive value, meet customer demands, and improve efficiency. Consumers are getting smarter. It’s time your warehouse does too. Discover how outsourcing with Ryder can improve your total supply chain performance at ryder.com/smartwarehouse.

Ryder and the Ryder logo are registered trademarks of Ryder System, Inc. Copyright ©2018 Ryder System, Inc. Ever better is a trademark of Ryder System, Inc.

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CHAIN REACTIONS

Google Speeds Up AI Training with Cloud TPUs Google customers can now use Cloud TPUs on the Cloud Machine Learning Engine (ML Engine) in beta to speed up the training of machine learning models. The Cloud ML Engine allows businesses to train and deploy machine learning models on datasets of various types and sizes using TensorFlow, Tech Republic reports.

In a blog post, Google said that the, “ML Engine handles the infrastructure, compute resources and job scheduling on your behalf, allowing you to focus on data and modeling.”

NEWS FROM ACROSS THE DIGITAL SUPPLY CHAIN

MANUFACTURERS MAY TAP BLOCKCHAIN FOR 3-D PRINTING Blockchain may soon have the capability to certify and trace 3D-printed parts through supply chains, The Wall Street Journal reports.

At the Consensus 2018 conference, panelists discussed how blockchain could create a data source that identifies 3D-printed parts, even narrowing down which machine made them, the technician who worked with them and the conditions under which they were produced. According to The Wall Street Journal, various firms throughout the supply chain would be able to utilize that data to ensure that parts were manufactured properly and quickly identify the source of any defects.

Currently, large firms have been experimenting with blockchain. The technology could potentially help trace the source of recalled food and other safety scenarios.

SHIPPING PALLETS TO BE SMARTER, SAFER AND STRONGER

Wooden shipping pallets have a habit of causing trouble within the supply chain. The wood can hold bacteria, can crack and has no potential of survival if there were to ever be a fire.

The maker of a new high-tech pallet thinks it might have the answer to wood pallet woes, however. Jeffrey Owen, CEO of Lightning Technologies, created an indestructible, lightweight, hygienic and fire-retardant pallet that contains an embedded tracking chip. The Lightning pallet is still made of wood, but it has a polymer coating that makes it durable and easy to sanitize, Forbes reports. The embedded chip records the pallet’s journey in real time and tracks the temperature, humidity, accidents and whereabouts.

Creating a more durable pallet with tracking technology isn’t a new idea.

What makes Lightning unqiue is it has rolled several innovations into one.

According to Forbes, Lightning Technologies so far has $87 million in pallet orders before achieving mass production. The main challenge the pallet manufacturer now faces is being able to produce the product fast enough. Owen expects to ramp up production this summer.

FEDEX SEES BLOCKCHAIN AS A ‘GAME CHANGER’ FedEx chief executive Frederick Smith said at the Consensus 2018 conference that the company is confident that blockchain has implications in supply chain, transportation and logistics, making it a big deal. He went on to say that blockchain has the potential to make information available to all parties for the first time ever.

The company is working to develop technology that would allow it to monitor shipments that are beyond its own tracking systems. According to The Wall Street Journal, FedEx keeps detailed records of custody using its own databases and internal systems. Having a distributed ledger that is shared across the industry would allow the company to track freight when it moves to different parts of the supply chain that it doesn’t own.

So far, FedEx’s blockchain technology has been built on Ethereum and Hyperledger platforms. The company aims to be agnostic when deciding which ledger technologies to use.

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INFRATAB EXPANDS PERISHABLE TRACK AND TRACE CAPABILITIES WITH FOUR NEW IOT SENSOR PATENTS

SAP Targets Agriculture With New Blockchain Initiative SAP announced that it’s expanding its work with blockchain into the supply chain space.

The company is looking to apply blockchain technology to agricultural supply chains by way of its Farm to Consumer Initiative.

SAP will integrate the technology into its global track and trace technology to act as an additional layer to core processes. Blockchain will allow companies to trace the origins of food products, enter requests and offerings and authenticate and execute transactions. So far, companies like Johnsonville, Naturipe Farms and Maple Leaf have signed on to work as additional collaborators on the project.

Infratab has added U.S. and European wireless Internet of Things (IoT) sensor patents to its worldwide intellectual property portfolio of radio frequency sensors, software, analytics and cloud solutions.

The new patents cover radio frequency IoT tag architecture; in-tag sensor operating environment application software; condition metrics for real-time assessment; and actions related to the condition of an object and the methods for setting up, calculating, reporting, storing, analyzing and using sensor data by trading partners in the supply chain and by those concerned with quantifying and monetizing condition.

Infratab’s Freshtime radio frequency sensor tags, middleware, and cloud software and analytics monitor and track goods for trading partners who make, store, transport, sell, service and use perishables. The radio frequency adds the what, where and when of tracking perishables.

5G KEY TO IOT The rollout of a fifth-generation (5G) wireless network is not just important for mobile phones anymore, but is seen as a key part of IoT advancement.

Emerging IoT applications such as low-power, wide area connections are forecast to grow at a more than 200 percent annual rate through 2021. Industry tracker IHS Markit predicts that 5G-based connections will help build machine-to-machine connections as well as new IoT platforms and services.

According to Enterprise Tech, IHS operators are taking advantage of recent upgrades to current 4G LTE connections as they tackle IoT applications.

Comcast is expanding machine-to-machine networks for use cases such as asset tracking and utility metering.

Meanwhile, AT&T and Verizon have launched a nationwide LTE-Machine IoT network and have been steadily shifting from network connectivity to other platforms and services. Enterprise Tech reports that the parent companies of T-Mobile (Deutsche Telecom) and Sprint (Softbank) have also focused on new IoT services that are based on 5G wireless networks.

As IoT applications remain critical to deploy, IHS Markit predicts that 5G networks will help support applications that require high reliability, strong security, and availability in areas like autonomous vehicles and automation equipment.

RANSOMWARE INCREASES ATTACKS ON SUPPLY CHAIN

According to the new NTT Security 2018 Global Threat Intelligence Report released last week by Dimension Data, ransomware has increased its attacks aimed at supply chains within the last year. The study showed 10 percent of global ransomware attacks were targeted against the business and professional services industry.

However, finance and technology remain the most targeted industries by ransomware and account for 70 percent of all attacks in the Americas, PYMNTS reports. The report found that ransomware-related incident responses at financial institutions dropped from 22 percent to 5 percent last year, though.

The report showed that supply chains have become a key target for ransomware attacks. Attackers are attempting to reach trade secrets and intellectual property that fill the supply chains.

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FEATURE

By Amy Wunderlin

AI’S PREDICTIVE INSIGHTS WILL

DRIVE GREATER COST SAVINGS

Companies are looking to artificial intelligence as the pressure to create a more agile supply chain while driving down costs heats up.

A

lack of visibility across the supply chain, coupled with unprecedented levels of data, is increasingly leading companies to artificial intelligence (AI)-backed solutions.

AI has the ability to streamline supply chain and logistics functions, while at the same time drive down costs. In fact, the technology is already delivering a competitive advantage for early adopters by cutting shipping times and costs.

In the report, Artificial Intelligence in Logistics: A collaborative report by DHL and IBM on implications and use cases for the logistics industry, DHL and IBM cite various real-world examples of the ROI companies can achieve with these technologies and how they can positively impact the bottom line.

They include: ❯❯ Transitioning away from legacy ERP systems to advanced analytics, increased automation, and hardware and software robotics and mobile computing ❯❯ Taking operations from reactive to proactive and planning from forecast to prediction ❯❯ Shifting processes from manual to autonomous and services from standardized to personalized.

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The report also notes that AI technologies can use things like advanced image recognition to track the condition of shipments and assets, bring endto-end autonomy to transportation and predict fluctuations in global shipment volumes before they occur.

For example, CEVA Logistics’ AI-powered supply chain is now 90 percent faster since adopting IBM’s cloud and AI solution dubbed Watson. CEVA solved the lack of visibility in its supply chain by putting its business documents in an electronic data interchange (EDI) format.

This update has had a significant impact on the performance of its supply chain, including zero downtime and no interruption to data flows, even at peak shopping times.

While IBM is now helping clients like CEVA achieve greater cost savings through an AIempowered solution, Watson was initially created to improve IBM’s own supply chain.

“A shortage of hard drives created an unexpected distribution in our ability to serve clients,” explains Jeanette Barlow, vice president strategy and offering management, supply chain solutions, IBM Watson Customer Engagement. “Having these shortages was not an acceptable thing. It [Watson]

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MAKING BETTER DECISIONS

started out as what we call the transparent supply chain initiative here at IBM. They began with just, ‘let’s have transparency.’ And part of that was creating the technology and the ability to bring that sort of operation center or dashboard up. Then they began to look at, ‘we now can start to see; how can we start to augment what we’re looking at with external data, with patterns that Watson recognizes as a guide for action when we do have disruptions?”

The key to Watson, Barlow adds, is its performance as a learning platform.

“How do we democratize that data that might typically sit with a few key, battle-hardened supply chain professionals?” she asks.

Ultimately, IBM’s AI solution is focused on alerting the user of possible supply disruptions, followed by what the downstream and upstream impact would be. Barlow says Watson has allowed IBM to drive an 18 percent reduction in inventory levels and reduce late orders, while expediting shipment orders by 75 percent, saving millions on inventory and reduced freight. But more importantly, she adds, IBM was able to give a better quality of service, with disruptions management and incident response plummeting from 18 days to hours to now minutes.

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According to Geoff Webb, vice president of product marketing at PROS, a cloud software company, he is seeing increased pressure for companies and their supply chains to be more agile—whether it’s quicker responses to the market, supplier demands or customer behavior.

“There is more of an acceleration and a drive toward agility that is driven by a need to be more responsive,” he adds. “All of that is based on an ability to process a huge amount of information and then apply a deep analytic skill set to it, where you can present advice, guidance and a capacity to offer real insight to the business itself.”

Thus, organizations are now realizing they need to start driving investment in their supply chain in ways they had not previously thought of. That’s where the benefits of AI come into play.

According to IBM’s Barlow, AI is a “visibility recommendation platform…not an executive engine.” Meaning, the emerging technology is meant to provide users with answers, options and solutions, which the user can then use to make the best possible decision and take action.

Companies must use the insights gleaned from their AI-enabled solution to push execution and invoke a change.

Barlow says you will go back to your core execution engines, such as ERP, to do that.

She adds that AI’s greatest benefit may be in its “ability to adjust the execution across the supply chain in a far timelier manner, so that you are able to meet or exceed your client’s expectations.

“You can have all the agility in the world if you carried enough extra inventory, but no one can afford to do that, right? So, [AI’s greatest benefit is] that ability to adjust to either changes in demand or changes in supply more quickly so that your commitment to the client is consistently met,” she says. [AI helps you] spot those disruptions and the possible implications, make recommendations and help you make better decisions more quickly.”

THE EMERGING TECHNOLOGY IS MEANT TO PROVIDE USERS WITH ANSWERS, OPTIONS AND SOLUTIONS, WHICH THE USER CAN THEN USE TO MAKE THE BEST POSSIBLE DECISION AND TAKE ACTION.

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FEATURE Advances in artificial intelligence (AI) are impacting industries across the supply chain. To examine attitudes toward AI, researchers at the Brookings Institution last month undertook an online national survey of 1,535 adult internet users. Responses were weighted using gender, age and region to match the demographics of the national internet population as estimated by the U.S. Census Bureau’s Current Population Survey.

1. H ow positive are you about artificial intelligence?

14%

very don’t positive know or no 27% answer somewhat 23% positive not very positive

36%

7. Do you think artificial intelligence represents a:

don’t know or no answer

somewhat optimistic

12%

42%

regulate artificial intelligence

don’t know or no answer

17%

not regulate artificial intelligence

9. W hich one is the leading country when it comes to artificial intelligence?

37%

19%

21%

don’t know or no answer

Japan

United States

12%

15%

don’t know or no answer

13%

4%

South Korea 4% Russia 2% Europe

(order was randomized)

have no effect on jobs

10. In 10 years, which one will be the leading country when it comes to artificial intelligence?

5. Do you expect artificial intelligence to:

34%

5%

increase personal 12% privacy have no effect on personal privacy

21%

20%

United States

China

35%

don’t know or no answer (order was randomized)

10

China

35%

create jobs

don’t know or no answer

8. Do you think government officials should:

41%

4. Do you expect artificial intelligence to:

reduce personal privacy

24%

no threat to human beings

very don’t know worried or no answer 27% somewhat 34% worried not very worried

49%

32%

threat to human beings

44%

3. How worried are you about artificial intelligence?

reduce jobs

13%

harder

not very optimistic

38%

easier

don’t know or no answer

12% very 32% optimistic don’t know 29% or no answer

27%

34%

53%

2. How optimistic are you about artificial intelligence?

27%

6. Do you expect artificial intelligence to make your dayto-day life:

14% Japan

3% Europe 3% South Korea 4% Russia

Webb agrees with Barlow calling AI a “tool” that beyond helping users make better decisions, ultimately can help them understand what questions they should be asking to drive business more effectively.

“The direction we see the technology heading is to augment the decision-making process of people,” Webb says. “The objective is not necessarily to remove the human element, but to enhance the capacity that human beings have…to augment their capacity to run their business by taking [things] off their plate, again, the challenges of managing very large volumes of data and making decisions faster and more effecively.”

For technology company Aera Technology, the augmentation of the decision-making process is at the core of its AI-based solution.

“Our vision is to enable the self-driving supply chain,” says Fred Laluyaux, president and CEO of Aera.

That vision has already become a reality for its Germany-based customer Merck KGaA, which transformed its supply chain with Aera’s AI-enabled technology by consistently predicting supply shortages, spikes in demand and bottlenecks.

Aera’s AI-based solution connects with a business to understand how it works, empowering it to make real-time recommendations, predict outcomes and automate operations. The company’s technology, Laluyaux says, was built on four principles: understand, recommend, predict and act.

IT’S ALL ABOUT THE DATA Not all data is created equal—but that’s where AI excels.

“The capacity to draw meaningful insight from data is where artificial intelligence really shines,” says Webb. “It allows me to look at things I would have missed or across a broader set of data I could not previously process. And do it faster. That ability to deliver real insight, even insight I wasn’t necessarily looking for at first is where AI is going to make the big difference.”

SUPPLY & DEMAND CHAIN EXECUTIVE

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FEATURE Webb continues that the old adage of “garbage in, garbage out” doesn’t necessarily apply to AI. “If you can’t work on good information, you’ll struggle to get good answers from it. However, one of the other nice things that AI is able to do is… kind of grind through lots of data and look for things where you can actually clean and groom data and make it more usable,” he adds. “You can also more quickly spot data that’s not really usable or is bad, as well as bring broader sets of information for analysis, even on a mundane level.”

Indeed, a global survey of more than 2,300 IT and business leaders by MIT Technology Review Insights and Pure Storage found that 86 percent of respondents believe data is key to making better business decisions. However, almost 80 percent had concerns about how to analyze data, specifically naming volume, collection and analysis as challenges.

Respondents also voiced concern over job security; however, those who work more closely with data were consistently more enthusiastic about adopting AI in the business.

But despite concerns, more than 80 percent of IT and business leaders surveyed expect that AI will have a positive impact on their industry, and

almost two-thirds expect to invest in AI solutions in the near future.

CREATING THE RIGHT CULTURE Implementing AI solutions (like many new technologies) ultimately depends on a successful cultural shift.

“In my history with new technologies, some of the early challenges are as much organizational and cultural as they are technological,” notes IBM’s Barlow.

Success with any new technology, she says, is driven by how well it aligns to a business focus.

“What are the business challenges and opportunities for your company that better insights could address or leverage?”

Fundamentally, you need that mental space at an organizational level to bring clarity in solving challenges and opportunities,” Barlow says.

Once you’ve established the gaps you are trying to fill, the clarity around how AI can be used for your particular business becomes clear.

“Organizations need to be very purposeful of, and focused on the business outcome that they’re trying to address. When you have that clarity and alignment between the business lead and the IT

Hype or Hope?

Gartner Says AI Confusion Is Obscuring Its Real Benefits Market hype and growing interest in artificial intelligence (AI) are pushing established software vendors to introduce AI into their product strategy, creating considerable confusion in the process, according to Gartner Inc. Analysts predict that by 2020, AI technologies will be virtually pervasive in almost every new software product and service.

In January 2016, the term “artificial intelligence” was not in the top 100 search terms on gartner.com. By May 2017, however, the term ranked at No.

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7, indicating the popularity of the topic and interest from Gartner clients in understanding how AI can and should be used as part of their digital business strategy. Gartner predicts that by 2020, AI will be a top five investment priority for more than 30 percent of chief information officers (CIO).

“As AI accelerates up the hype cycle, many software providers are looking to stake their claim in the biggest gold rush in recent years,” says Jim Hare, research vice president at Gartner. “AI offers exciting possibilities, but unfortu-

nately, most vendors are focused on the goal of simply building and marketing an AI-based product rather than first identifying needs, potential uses and the business value to customers.”

To successfully exploit the AI opportunity, technology providers need to understand how to respond to three key issues: 1) L ack of differentiation is creating confusion and delaying purchase decisions.

The huge increase in startups and established vendors all claiming to offer AI products without any real differentiation is confusing buyers. More than 1,000 vendors with applications and platforms describe themselves as AI vendors, or say they employ AI in their products.

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FEATURE lead, it becomes far easier for organizations to technology that has yet to have widespread embark on this journey,” Barlow says. adoption,” Webb notes, adding, “Overcoming that, Andrew Lynch, president of Zipline not just the understanding, but the belief and then Logistics, a digitally-enabled, managed the trust, is the requirement that we as a company transportation partner like PROS, where we have a specializing exclusively strong AI background, our in the consumer goods sector, job is to help them make couldn’t agree more. those steps. The good news “Operational/organizational is that there is proof out alignment is the only way there that it works. We have in these really challenging customers that do it, and that transportation environments have been doing it for a long for shippers, BCOs and buyers time.” of transportation to realize any That trust may come easier impactful savings or to avoid than we think, however. A significant service disruptions recent survey by Harvard that can occur with trying to Business Review, which polled meet budgets through tactical 1,770 managers from 14 transactional behavior,” he says. countries and interviewed PROS’ Webb adds to that 37 executives in charge of — HARVARD BUSINESS message. He says in order digital transformation at their for AI to be widely accepted, organizations, found that REVIEW SURVEY people have to know and 78 percent of the surveyed believe that it can solve their problems for them. managers believe they will trust the advice of In other words, users must learn to trust AI. intelligent systems in making business decisions “That is a lot to ask organizations with in the future.

FOUND THAT

78%

OF THE SURVEYED MANAGERS BELIEVE THAT THEY WILL TRUST THE ADVICE OF INTELLIGENT SYSTEMS IN MAKING BUSINESS DECISIONS IN THE FUTURE.

Similar to greenwashing, in which companies exaggerate the environmental-friendliness of their products or practices for business benefit, many technology vendors are now “AI washing” by applying the AI label a little too indiscriminately, according to Gartner. This widespread use of “AI washing” is already having real consequences for investment in the technology.

2) P roven, less complex machine-learning capabilities can address many end-user needs.

To build trust with end-user organizations vendors should focus on building a collection of case studies with quantifiable results achieved using AI.

3) O rganizations lack the skills to evaluate, build and deploy AI solutions.

Advancements in AI, such as deep learning, are getting a lot of buzz but are obfuscating the value of more straightforward, proven approaches.

Gartner recommends that vendors use the simplest approach that can do the job over cutting-edge AI techniques.

More than half the respondents to Gartner’s 2017 AI development strategies survey indicated that the lack of necessary staff skills was the top challenge to adopting AI in their organization.

“Use the term ‘AI’ wisely in your sales and marketing materials,” Hare says.

“Be clear what differentiates your AI offering and what problem it solves.”

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The survey found organizations are currently seeking AI solutions that can improve decision-making and process automation. If they had a choice, most organizations would prefer to buy embedded or packaged AI solutions rather than trying to build a custom solution.

“Software vendors need to focus on offering solutions to business problems rather than just cutting-edge technology,” adds Hare. “Highlight how your AI solution helps address the skills shortage and how it can deliver value faster than trying to build a custom AI solution in-house.”

www.SDCExec.com | June 2018 | SUPPLY & DEMAND CHAIN EXECUTIVE

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SDCE 100 » 2018

By Editorial Staff, Supply & Demand Chain Executive

FEATURED PROJECTS

ENABLER: 3GTMS — www.3gtms.com CUSTOMER: Dynamic Logistix PROJECT GOAL: Implement a best-of-breed TMS that provides mid-market customers with a comprehensive solution to address the complete orderto-settlement lifecycle SOLUTIONS: TMS BUSINESS IMPACT: Dynamic Logistix found

success by digitizing its spreadsheets. By using a 3Gtms web-based shared environment, the company is able to pinpoint savings opportunities in areas that had no visibility before. The company can now analyze data and know exactly where to negotiate with carriers to save money.

ENABLER: AGISTIX — www.agistix.com CUSTOMER: Top 10 Utility Company PROJECT GOAL: Create a single platform for global supply chain visibility, execution, and freight audit and payment SOLUTIONS: Robust suite of REST APIs, web services, EDI integration and automation BUSINESS IMPACT: As the project continues to evolve, the company saw savings greater than 22 percent.

ENABLER: AFS TECHNOLOGIES — dms.afsi.com

ENABLER: ALOM — www.alom.com

CUSTOMER: Watsonville Coast Produce

CUSTOMER: Home Genetic DNA Testing Company

PROJECT GOAL: Implement an ERP system with

tools to help expand their business in the future

SOLUTIONS: AFS ERP BUSINESS IMPACT: Watsonville now has the ability

to construct more creative commission structures to help motivate its sales staff. The company saw an increase in robust commissions, invoicing and credit management 14

functionality. The capabilities within AFS ERP allowed the company to set up commissions, which improved the time for invoicing and made credit management easier.

PROJECT GOAL: Scale inventory management and order fulfillment capacity to meet projected year-overyear order volume increases SOLUTIONS: Proprietary, infinitely scalable order routing and fulfillment management solution based on SKU customization, inventory position and end-user location

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DRIVING TOWARD THE PATH OF SUPPLY CHAIN SUCCESS There are many challenges companies face when trying to manage their supply chain capabilities. It is crucial for a company to continue to pursue, develop and implement best practices that leverage well-organized projects that are relevant to strategic objectives. The outcome of these projects provide further insight into the innovation and opportunity for improved operations within supply chains.

The 2018 Supply & Demand Chain Executive 100 shines the spotlight on the industry’s most successful and transforming projects that deliver value to enterprises across a range of supply chain functions. The projects featured in this award’s program offer a forward-looking perspective for the industry on new opportunities designed to drive operational success.

BUSINESS IMPACT: ALOM helped the customer exceed four-times its year-over-year growth forecast and enable continued exponential fulfillment capacity. The supply chain delivered record revenue for the client and set groundwork for continued future growth. This helped the customer establish itself as a leader in the home DNA/health test kit industry.

into new suppliers and endpoints while developing creative transportation solutions to meet its high service standards.

ENABLER: AMERICAN GLOBAL LOGISTICS — www.americangloballogistics.com

PROJECT GOAL: Identify gaps in existing processes and optimize the supply chain network

CUSTOMER: Bassett Furniture

SOLUTIONS: Arkieva Demand Planner, Arkieva Inventory Planner, Arkieva Supply Planner (Optimization) and S&OP Dashboards

PROJECT GOAL: Source materials from suppliers around the globe with cloud-based technology and trim costs, while ensuring prompt movement of goods SOLUTIONS: American Global Logistics’ combination of proprietary technology, logistics services and hands -on support BUSINESS IMPACT: American Global Logistics worked closely with Basset Furniture’s distribution centers and domestic trucking operations to minimize accessorial fees and shipping delays. With AGL, Bassett earned cargo-owner status, helping it gain better prices on ocean freight. As the company’s sole customs broker, AGL helps ensure customs compliance and timeliness while keeping the company updated on best practices.

AGL’s 4PL approach allows Bassett to gain transparency

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ENABLER: ARKIEVA — www.arkieva.com CUSTOMER: Leading Manufacturer of Corrugated

HDPE Pipe

BUSINESS IMPACT: The company improved the collaborative planning process based on different scenarios of supply, demand and production capabilities in the short and long term. It also optimized inventory levels across different plants and improved customer satisfaction while presenting huge cost savings.

ENABLER: BLUJAY SOLUTIONS — www.blujaysolutions.com CUSTOMER: Cooke Aquaculture PROJECT GOAL: Supply chain planning, execution and visibility across global business units utilizing SaaS technology integrated with ERP SDCExec.com | June 2018 | SUPPLY & DEMAND CHAIN EXECUTIVE

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SDCE 100 » 2018 SOLUTIONS: BluJay Solutions’ Transportation Management for Shippers technology, BluJay Solutions’ Professional Services for implementation BUSINESS IMPACT: Cooke Aquaculture saw improved carrier management due to enhanced visibility to invoice charges; improved oversight resulted in corrected invoice structure; expanded carrier base resulted in rate savings. Its streamlined processes freed up personnel for more value-add activities and oversight that did not previously exist.

ENABLER: B-STOCK — www.bstock.com CUSTOMER: Fortune 500 Home Improvement Retailer PROJECT GOAL: Branded B2B marketplace for returned, excess and other liquidation inventory SOLUTIONS: B-Stock’s Enterprise PaaS, Auction Strategy, Demand Generation BUSINESS IMPACT: B-Stock launched a branded private B2B liquidation marketplace for the home improvement retailer. Within days of launching its marketplace, the retailer had nearly 1,000 registered buyers competing for truckload-size quantities of its returned and overstock appliances. Ongoing demand generation campaigns have since continued to drive qualified buyers to the marketplace, with up to 300 new buyers registering each month. One of the key drivers of new buyer registrations was adjusting lot size to match buyer demand. In order to do so, B-Stock recommended breaking the lots down so more buyers were able to participate, generating an immediate impact on recovery.

ENABLER: CLOUDLEAF INC. — www.cloudleaf.com CUSTOMER: Big Pharma Company PROJECT GOAL: Manage FDA regulatory compliance and reduce losses due to inefficient tracking, visibility and condition monitoring for life-saving drugs and raw materials

SOLUTIONS: IoT, Industrial IoT BUSINESS IMPACT: Cloudleaf continues to help transform supply chain visibility and optimization by solving visibility problems and capturing real-time data from operations using cloud and machine-learning devices. With its technology, the big pharma company was able to increase savings by $6 million per month.

ENABLER: COMMAND ALKON — www.commandalkon.com CUSTOMER: Wayne Davis Concrete 16

PROJECT GOAL: Manage daily replenishment plans for ready-mix concrete producer to reduce out of stocks SOLUTIONS: Command Alkon supplyCONNECT BUSINESS IMPACT: Wayne Davis Concrete managers quickly saw the value of visibility once supplyCONNECT was in place. The real-time supply and demand information provided by the software virtually eliminated stockouts. Time that was previously spent manually handling raw material replenishment was now focused on ensuring customers’ deliveries, improving costs by eliminating expensive wait times at plants, efficiently lowering on-hand inventory and allowing them the ability to proactively plan their material sourcing. The company also saw time reduction in gathering inventory information from plants. SupplyCONNECT provides Wayne Davis live inventory levels in one place, helping build confidence within the company. Wayne Davis also saw lower costs due to more efficient use of inventory.

With the solution, material demand was automatically tracked and plants were able to prioritize based on material needs. Additionally, the company saw servicing high-production pours with a single tanker. With the visibility into the material demand, Wayne Davis can now accurately determine if they can wait on a delivery being made from the source that is farther away, but at a lower cost. Knowing when their plants will actually need the material allows for more cost-effective decision-making.

ENABLER: DEMAND MANAGEMENT INC. — www.demandsolutions.com CUSTOMER: TenCate Protective Fabrics PROJECT GOAL: Improve the efficiency of the forecasting process by moving away from basing forecasts on sales estimates SOLUTIONS: Demand Solutions DSX BUSINESS IMPACT: TenCate Protective Fabrics saw immediate benefits from implementing Demand Solutions DSX. The company was able to reduce eight man-hours per month with the ability of sales representatives to key forecasts directly into the system.

Tencate saw better analytics with the ability to marry forecast data to other data for use in Analytical reporting.

Operations and sales also benefitted from the use of the new technology. The hardstock was reduced by $4 million over an 18-month period and forecast accuracy increased 15 percent.

ENABLER: ELEMICA — www.elemica.com CUSTOMER: Leading Consumer Product Company

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62%

of online shoppers say FREE shipping is very important when making a purchase.

Worried about offering your customers free shipping? Don’t be. At Saddle Creek, we’re able to help control shipping costs through economies of scale, advanced technology and optimal network configuration. And with our strategic locations nationwide, reach 70% of US customers in 2 days via ground – 99% with multiple DCs. That leaves you free to tackle your next challenge.

sclogistics.com/fulfillment | 888-878-1177 *Source: NRF 2017 Consumer Survey

WAREHOUSING • OMNICHANNEL FULFILLMENT • TRANSPORTATION

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SDCE 100 » 2018 PROJECT GOAL: Better manage inventory replenishment system with railcars that transport raw materials across global border SOLUTIONS: Elemica Digital Supply Network for process manufacturers, Elemica Vendor Managed Inventory BUSINESS IMPACT: Future process improvements were made to drive significant enhanced benefits for the customer, including the ability to move from five to seven receiving days per week across several operation scenarios without changing safety stock. The company saw nearly 25-percent reduction in inventory onhand, 33-75 percent reduction in use of safety stock, 40-60 percent reduction in incidents where stock levels exceed the two-times safety stock level.

ENABLER: FASCOR INC. — www.fascor.com CUSTOMER: Bryan Equipment Sales PROJECT GOAL: Automate warehouse and shipping operations, improve order accuracy and through-put efficiency, while maintaining world-class service levels despite record growth SOLUTIONS: Fascor WMS and Fascor TMS BUSINESS IMPACT: Bryan Equipment Sales partnered with FASCOR to deliver on their goals in a timely and cost-effective manner.

Since implementing FASCOR’s WMS and TMS solutions, it has shipped over 5 million power tools and parts, decreasing error rates by 88 percent. Bryan’s productivity has increased by 68 percent with a slight addition in warehouse man hours. The entire team now has the capability to monitor inventory and warehouse activity in real time using FASCOR’s WebTools performance dashboards, creating crucial visibility that was much needed throughout their end-to-end operations to continuously achieve their goals.

ENABLER: JOHN GALT SOLUTIONS — www.johngalt.com CUSTOMER: Rug Doctor PROJECT GOAL: Improve supply chain network and over-all profitability through better understanding of customer demand at the store level SOLUTIONS: Atlas Planning Suite BUSINESS IMPACT: After originally facing difficulties when routing service technicians to their stores, the Rug Doctor now uses Atlas to set routing plans based on real-time demand. The company now sees a decrease in expenses in logistical resources and over time, and has improved customer-service levels while increasing profitability.

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ENABLER: KUEBIX — www.kuebix.com CUSTOMER: Manufacturer of retail and industrial scales, slicers, weigh price labeling equipment, check weighers and software products PROJECT GOAL: Gain control, visibility and lower costs in transportation processes using a TMS SOLUTIONS: Kuebix TMS BUSINESS IMPACT: The customer has seen tremendous savings across the board since going live with Kuebix in 2017. One of the biggest standout savings is the reduction in the cost-perpound for shipments. Before Kuebix TMS, cost-per-pound was $.50, but since being implemented, the cost has dropped to $.10 per pound. Since implementing the system, the company has spent $200,000 in shipping costs in the last four months, averaging nearly $50,000 a month. Prior to this, overall shipping costs were $73,000 a month. The company is primed to save over $1 million annually in transportation costs using the Kuebix system.

ENABLER: LOGILITY — www.logility.com CUSTOMER: Textile Company PROJECT GOAL: Implement an integrated planning solution to increase visibility and manage working capital to profitably grow the business and create a single, feasible plan SOLUTIONS: Logility Voyager Solutions BUSINESS IMPACT: A global provider of fabricbased solutions for the awning, marine, furniture, protective, military and geo-synthetics industries, realized significant benefits across the organization following its implementation of Logility Voyager Solutions. The company now operates on a single plan to facilitate its Sales and Operations Planning process.

Forecast Accuracy measured by MAPE decreased from 42 percent to now less than 19 percent, while the company’s sales volume increased with no increase in overall inventory. Additionally, the company saw on-time deliveries improve.

Today, the supply chain team is able to quickly provide the sales organization with a detailed statistical forecast at multiple hierarchical levels. This allows them to develop an accurate starting position for the annual business planning process. In addition, the company has

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2018 SDCE 100 a monthly standard workflow that helps streamline its supply chain operations.

ENABLER: LOGISTYX TECHNOLOGIES — www.logistyx.com CUSTOMER: Service Lighting/LightBulbs.com PROJECT GOAL: Increase Lightbulbs.com’s order fulfillment efficiency by streamlining shipment processes through automating rate shopping and minimize processing the “touches” required to complete a shipment SOLUTIONS USED: Logistyx Ship-IT multi-carrier

shipping software, Rice Lake iDim 3D Dimensioning system and two Size-IT handheld dimensioners

BUSINESS IMPACT: By implementing Logistyx shipping software, integrated with the dimensioners to automatically capture and upload package measurements for carrier rate calculation, Service Lighting eliminated multiple steps in shipment processing and gained a five-times increase in productivity—all while reducing its number of shipping stations by 66 percent. The company was also able to reallocate employees to other areas in the warehouse that needed help. With the new Logistyx solution, LightBulbs.com was able to scale up to meet peak shipping volumes that doubled year-over-year sales without adding staff.

ENABLER: MONDCLOUD INC. — www.mondcloud.com CUSTOMER: School Specialty PROJECT GOAL: Improve supply chain agility by reducing vendor and customer on-boarding time and cost, along with increased visibility SOLUTIONS: AS2 server, FTP server, EDI

management, Partner on boarding, Perfect Order Dashboard, Business Activity Monitoring, Real-time monitoring and alters, multi-tenant secure cloud solution

BUSINESS IMPACT: School Specialty was able to successfully move to mondCloud services without any disruptions to existing business. As a result, partner on-boarding timeframes decreased from three to four months to just three weeks and B2B errors were significantly reduced. The company was able to monitor end-to-end supply chain transactions through the real-time monitoring dashboard system and saw improved operation efficiency. School Specialty was able to accomplish all projected goals and deadlines, and achieve an ROI of 50-percent reduction in B2B spending.Customers are also planning to on-board another 150 paper-based vendors in 2018.

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ENABLER: PROSHIP INC — www.proshipinc.com CUSTOMER: A Catalog/E-commerce

Distributor

PROJECT GOAL: Reduce labor and shipping costs due to remote distribution center location SOLUTIONS: CVP Automated Packing Solution and ProShip Multi-Carrier Shipping Software BUSINESS IMPACT: In order to meet the e-commerce distributor’s goal of decreased labor and more automation throughout its warehouse, the company turned to the CVP Automated Packing Solution which builds, fills, folds and labels parcels in one seamless process and creates a custom-fit parcel in seconds. Because the CVP Automated Packing Solution only requires one operator, it has reduced the company’s labor costs. Since implementing the solution in 2016, the e-commerce distributor has met its goals of decreasing labor and shipping costs.

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SDCExec.com | June 2018 | SUPPLY & DEMAND CHAIN EXECUTIVE

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SDCE 100 » 2018 ENABLER: PROTOLABS — www.protolabs.com CUSTOMER: HP Inc. PROJECT GOAL: Reduce design cycle time and produce prototypes and low-volume bridge production in materials that will be used in the final product for nextgeneration inkjet printers and cartridges SOLUTIONS: Digital Manufacturing - front end

automation, design for manufacturability software, expedited delivery and injection molding

BUSINESS IMPACT: Dramatically reduced design

cycle time from a standard of six-to-eight weeks to just 15 days or less using Protolabs. The faster, more streamlined process helped HP stay at the top of the world’s highly competitive printer market.

ENABLER: REZ-1 — www.rez1.com CUSTOMER: CSX Corporation PROJECT GOAL: Create an analytical tool to visualize complex intermodal rail freight transportation and ultimately increase container utilization SOLUTIONS: A custom, interactive dashboard built for the REZ-1 Asset Management BUSINESS IMPACT: REZ-1 provided CSX Corporation with a dynamic, flexible data visualization tool that guides fleet utilization decisions and provides CSX customers improved availability to CSX containers.

CSX uses the intelligence tool to view and analyze segments by load type and identify the least and most efficient load cycle segments. With the business intelligence tool, fleet utilization is higher than before and reports have positively affected the bottom line by providing analytics to visualize their complex freight transportation system and manage the pieces with a holistic view.

ENABLER: SADDLE CREEK LOGISTICS SERVICES — www.sclogistics.com CUSTOMER: Graduation Source PROJECT GOAL: Improve order accuracy, delivery times and inventory visibility SOLUTIONS: WMS, bi-directional application programming interfaces, web portals and customized reporting.

BUSINESS IMPACT: With Saddle Creek’s technology, Graduation Source was able to achieve its goal 50 percent faster. Overall inventory accuracy and visibility 20

have increased significantly, and as a result, Graduation Source has been able to reduce on-hand inventory levels and reduce monthly freight spend.

ENABLER: SILVON SOFTWARE INC. — www.silvon.com CUSTOMER: Global Producer of Dairy Products PROJECT GOAL: Provide better supply chain visibility and forecasting capabilities SOLUTIONS: Silvon’s Stratum applications for sales analysis, inventory performance management and statistical forecasting BUSINESS IMPACT: Since utilizing

Silvon’s Stratum analytics and forecasting engine, the dairy producer’s forecast accuracy improved by 8 percent to 98 percent. The producer has been able to decrease operating expenses that had previously resulted from inaccurate forecasting methods and reduce spoiled product or product facing expiration to its goal of .25 percent of gross sales. With the tools provided to them by Silvon, the company’s sales team spends less time forecasting and more time strategically selling. In addition, everyone enterprisewide now has the ability to find the root cause of any issues that may occur across its supply chain.

ENABLER: TRANSPOREON GROUP AMERICAS — www.transporeon.com CUSTOMER: A Global Steel Wire Manufacturer PROJECT GOAL: To align strategic sourcing and executional transportation management across its North American operations SOLUTIONS: Transporeon shipment execution, Transporeon Best Carrier, Transporeon No-Touch Order, Transporeon Dock Scheduling BUSINESS IMPACT: The global steel wire manufacturer was able to receive substantial results from implementing TMS. Results include: reduction in carrier payment processing efforts with quicker issue resolution, the ability to independently validate tenders assigned to lowest-cost provider in an audit-proof system, utilize an “appointment only” model ensure time slots are set up to match shipping capacity, create control transportation for incoming freight and have a significant reduction in transportation spend.

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MORE SDCE 100 RECIPIENTS WW4flow, www.4flow.com WW4SIGHT Supply Chain Solutions, www.go4sight.com WW6 River Systems, www.6river.com WWA. Duie Pyle, www.aduiepyle.com WWAFN, www.loadafn.com WWAmazing Print Tech, www.amazingprint.com WWArviem AG, www.arviem.com WWBAM, www.bamwire.com WWBlue Ridge, www.blueridgeglobal.com WWBringg, www.bringg.com WWC3 Solutions, www.c3solutions.com WWCargo Chief, www.cargochief.com WWCBX Software, www.cbxsoftware.com WWChainalytics, www.chainalytics.com WWCimcorp Automation Ltd., www.cimcorp.com WWCleanChain, an ADEC Innovation, www.esg.adec-innovations.com

WWConnXus, www.connxus.com WWConvey, www.getconvey.com WWCorcentric, www.corcentric.com WWCrown Equipment Corporation, www.crown.com WWDeposco Inc., www.deposco.com WWecmarket, creator of Conexiom, www.conexiom.com WWenVista, www.envistacorp.com WWEpicor Software Corporation, www.epicor.com WWEVS LLC, www.evssw.com WWExpertek Systems, www.expertek.com

WWFetch Robotics, www.fetchrobotics.com WWFinVantage Solutions, www.finvantage.com WWGEP, www.gep.com WWGlobal4PL, www.global-4pl.com WWHewlett Packard Enterprise (HPE), www.hpe.com WWHighJump, www.highjump.com WWInmar, www.inmar.com WWInvata Intralogistics, www.invata.com WWIvanti, www.ivanti.com WWJDA Software, www.jda.com WWJVKellyGroup Inc., www.jvkg.com WWLevaData Inc., www.levadata.com WWLiquidity Services, www.liquidityservices.com WWLLamasoft, www.llamasoft.com WWLogistical Labs, www.logisticallabs.com WWNorthern Safety, www.supplypro.com WWNGC Software, www.ngcsoftware.com WWNimbeLink, www.nimbelink.com WWOmnics Inc., www.omnics.io WWOmnify Softwre, www.omnifysoft.com WWOnProcess Technology, www.onprocess.com WWOpen Sky Group, www.openskygroup.com WWOptricity, www.gfs.com/en-us WWOracle, www.oracle.com/index.html WWOrderDynamics, www.orderdynamics.com WWPace Harmon, www.paceharmon.com

WWParagon Softtware Systems, www.paragonrouting.com WWPINC, www.pinc.com WWQAD, www.qad.com WWQuintiq, www.quintiq.com WWRanda Accessories, www.randa.net WWRapidRatings, www.rapidratings.com WWRasilant Technologies Pvt. Ltd., www.rasilant.com WWRoambee Corporation, www.roambee.com WWSAP Ariba, www.ariba.com WWSAP Fieldglass, www.fieldglass.com WWShipHawk, www.shiphawk.com WWSource One Management Services, www.sourceoneinc.com WWSpend Management Experts, www.spendmgmt.com WWSPS Commerce, www.spscommerce.com WWSymphony RetailAI, www.symphonyretailai.com WWSynergy NA Inc. (Snapfulfil), www.snapfulfil.com WWTECSYS Inc., www.tecsys.com WWTEKLYNX International, www.teklynx.com WWThe Raymond Corporation, www.raymondcorp.com WWTradeIX, www.tradeix.com WWTradeshift, www.tradeshift.com WWTransportation Insight, www.transportationinsight.com WWUltraShipTMS, www.ultrashiptms.com WWUNEX Manufacturing, www.unex.com WWVCO LLC, www.vcosystems.com WWWise Systems, www.wisesystems.com

Read The Benefits of Purpose-built Technology For Food Distributors.

AFS ERP Purpose-built for Food Distribution Companies http://dist.afsi.com

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MADE IN AMERICA

By Mackenna Moralez

BRINGING TOYS

BACK TO THE STATES

L

uke Barber wasn’t exactly sure what he was going to do after he graduated from college. With the gloom of the 2008 recession still hovering over the job market, his father, Jim Barber, suggested he play around on a software program he had recently puchased for his new startup, Luke’s Toy Factory.

“He’s a millennial, and they have this ability to look at something on a computer and figure it out,” Jim says.

“I couldn’t figure it out, but I knew he could.”

A few weeks later, Luke designed the company’s first toy—a little red fire engine.

The idea behind Luke’s Toy Factory began long before Luke ever got his hands on the software, however.

Jim first dreamed of reviving American toy manufacturing after a major scandal involving Chinesemade toys shook the industry. In 22

2007, Mattel, the world’s largest toy company, recalled 436,000 die-cast toy cars after it was found they were coated in lead paint. That same year, Mattel also recalled nearly 19 million other Chinese-made toys because their small, powerful magnets could be harmful to children if swallowed.

To Jim, the scandal signaled a toy industry gone awry. It felt like companies were straying away from what they had originally intended to do and what toys are for—to make children happy.

“The toy industry had gotten away from caring about kids to caring more about profits,” Jim says. “I wanted to watch every step of the [manufacturing] process to make sure it was done right.”

With the visison secured, Jim and his business partner jumped right in and secured the machines and software needed. However, his partner left the

Luke’s Toy Factory aims to bring manufacturing back to America, with toys produced with sustainable, safe practices. company once he realized how hard it was to start a business.

Following Luke’s prototype, another father and son team, Mitch and Evan Achiron, joined the business as a graphic designer and social media coordinator.

Luke’s Toy Factory was born.

To initially get their product off the ground, the company created a Kickstarter fundraising campaign with a goal of $15,000.

“It covered getting started, and with toys, there’s a testing regimen that you have to go through,” Jim explains. “The big part is getting people to look at your project. There’s so many people on the platform.”

For Luke’s Toy Factory, transparency has always been important. The company relies heavily on eco-friendly materials to make its toys safe, so allowing donors to see each step of the process was crucial to the campaign.

“It’s a really important way to get attention. Especially with a company like ours that is manufacturing in America and trying to use eco-friendly material,” Jim says.

Each toy is made of 30 percent saw dust and 70 percent plastic. The company found it necessary to partake in sustainable and safe practices during production not only because they felt it was the right thing to do, but because of pressure from the Chinese toy scandal.

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A HIGHER STANDARD

But it was important to the Barbers to use eco-friendly and recycled material in their toys, so the company was prepared for the high standards its toys would be held. Unlike in traditional toy manufacturing where the toy’s colors are often painted on, Luke’s Toy Factory molds the color of the toys into materials free from chemicals such as BPA or phthalates.

Luckily for Luke’s Toy Factory, the production process takes about a month, making it easy to get its product out to consumers. With its products being made up of 30 percent

When the company first incorporated in 2012, Jim made his way to the National Plastic Exposition to learn more about the manufacturing process. With a background in advertising photography, Jim says he didn’t know a lot about what goes on behind the scenes.

“I came into this business knowing absolutely nothing about manufacturing,” he says. “The more I get into manufacturing, the more I learn about what doesn’t work and what does.”

When he arrived at the conference, he learned more about the molding process and determined recycled plastic was the right fit for him. However, some plastic recyclers at the show didn’t want anything to do with him in fear of being sued.

“The toy industry had gotten away from caring about kids to caring more about profits. I wanted to watch every step of the [manufacturing] process to make sure it was done right.” sawdust, it changes how the part works through the heat cycle, meaning that it doesn’t have to heat up or cool down, essentially speeding up the cycle time. The company also prides itself on working with companies close to its headquarters in Connecticut, so that they’re able to drive to get their materials instead of facing hefty shipping costs.

“A lot of the issues that we’ve encountered in doing this project stem from being a toy company.

There’s extra levels of care that have to be taken as a manufacturer,” Jim explains. “To take that back further in the supply chain, there has to be an extra level of care that comes by a materials supplier for the same reason.”

According to the Consumer Product Safety Commission website, “all toys intended for use by children 12 years of age and under must be third-party tested in a Children’s Product Certificate as compliant to the federal toy safety standard enacted

by Congress and to other applicable requirements as well.”

STEM EDUCATION Starting in 2018, Luke’s Toy Factory began marketing its toys toward educators in two different catalogs.

Aimed at children ages 3 to 5 years old, teachers are able to introduce students to basic concepts such as counting and colors. And the response so far has been positive. In the first half of the

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year, the trucks have been implemented in hundreds of classrooms.

“Teachers get it right away,” Jim says. “The way that the toy is built isn’t difficult. There’s no instruction manual, so kids are able to figure it out for themselves.”

Jim describes the toys as a 3D puzzle that become a truck when assembled.

The pieces are specifically designed for small hands, and parts can be mixed and matched. The toys help children develop their fine motor skills and help them learn about what each truck represents. For example, the company

sells a toy recycling truck and a toy fire truck. Educators and parents can help explain to children what roles the trucks perform.

The father and son teams also made the conscious decision to keep their product out of big retail stores, instead favoring mom-and-pop stores across the country. Jim explains that smaller stores are able to set up a better display of the product, and in a chain store, the company would risk knock-off competitors within a year.

Besides the safety benefits, overall it is important to Luke’s Toy Factory that its toys are made in America and are bringing more jobs back to the country.

“Not everyone can be a scientist or a computer engineer. There are plenty of people that just want a day-ends work.

They want to wipe their hands and do a good job. You learn by doing, and you learn by working on the job,” Jim says. “Local manufacturing is going to come back. There’s a revolution in the process.”

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FEATURE

By Ron Summerhill

SPEND MANAGEMENT’S ROLE IN I With businesses that are ready to listen, Industry 4.0 will offer massive insights into the supply chain and its demand-side to provide new benchmarks for efficiency and value.

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ndustry 4.0. The next industrial revolution.

This hyper-connected future is already starting to take shape. With businesses that are ready to listen, Industry 4.0 will offer massive insights into the supply chain and its demand-side to provide new benchmarks for efficiency and value.

Industry 4.0 will differ from the current computerized, networked business environment.

In this sense, it will be smarter. Cyber-physical systems will communicate and cooperate with each other autonomously across the value chain in real time, introducing a new level of end-toend visibility across the entire supply chain. By replacing silos of connectivity, Industry 4.0 will cross both internal and cross-organizational boundaries, automating much of the machine-tomachine interaction.

But this means more than data interoperability.

Ongoing globalization and digitalization has increased the complexity and competition for businesses, ushering in new opportunities to optimize their internal operations. They’re recognizing the strategic value their procurement departments can cultivate beyond primarily transactional functions.

The lines between traditional organizational boundaries start to blur between expanding procurement’s collaboration efforts with other departments, such as research and development (R&D), marketing and IT. For the procurement professional responsible for squeezing the most value out of the supply chain, Industry 4.0 is in some respects a logical outcome of the automation they’ve been progressively deploying for decades. Even so, it represents both a significant change and challenge, according to experts.

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PUSH TO PULL If everything goes according to plan, Industry 4.0 will change the economy from push to pull.

Instead of using forecasts to predict demand, businesses will have access to accurate, real-time data. Every component in the chain will be visible to each other with the advancement of IoT and blockchain technology. Actual demand can become the signal, rather than proxies for demand—the business “forecasts” of today.

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N INDUSTRY 4.0 It all stems from the connectivity of the internet and the immediacy of customer conversations.

Globalization and the streamlining of manufacturing were already well underway before social media flipped the pyramid and empowered the consumer. The speed, volume and velocity of social media gives customers the power to influence their peers, and in turn, wield control over brands.

That isn’t to say that analytics will become obsolete—far from it. Rather, existing inputs like inventory, spend, and manufacturing performance will be joined by IoT and social media data.

Making sense of this cacophony will require machine learning systems to read changes in the demand side and update the upstream manufacturing and supply processes accordingly.

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To be efficient and responsive in such a pull economy, businesses have to attend to these demand signals and react quickly. That means enterprise software, specifically e-procurement platforms, will be at the heart of this engine.

In addition to providing valuable intel on demand, Industry 4.0 will also play a big role in increasing efficiency through the automation of manual activities required to meet this demand. To ensure service-level agreements and pricing are in compliance, smart contracts leveraging blockchain technology will be the logical choice. Smart contracts provide a secure, automated, digital record of goods purchased, sold and delivered, and will be traceable throughout the entire supply chain process.

To this point, the shift from what brands had to sell (push) to what consumers want to buy (pull) has been most apparent in the consumer packaged goods (CPG) industry due to its long and complex supply chains.

www.SDCExec.com | June 2018 | SUPPLY & DEMAND CHAIN EXECUTIVE

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FEATURE “DIGITAL PLATFORMS AND BUSINESS ECOSYSTEMS ARE CREATING NEW MODELS FOR VALUE CREATION, DELIVERY AND COMPETITION IN MANY INDUSTRIES. GOVERNMENT AND BANKING ARE BECOMING MORE OPEN. HEALTHCARE IS MAKING IT EASIER TO SHARE DATA BETWEEN PATIENTS, PROVIDERS AND PAYERS. COMMUNICATIONS SERVICE PROVIDERS ARE TURNING PLATFORMS INTO PRODUCTS AND CHANGING THEIR OPERATING MODELS. MANUFACTURING IS TURNING PRODUCTS INTO SERVICES.” — CAPITALIZING ON YOUR BUSINESS ECOSYSTEMS ECONOMY: A GARTNER TREND INSIGHT REPORT

However, not all sectors see demand ebb and flow with as much volatility as CPG. The governmental, infrastructure and utilities sectors are seemingly less impacted right now. Even here we can expect to see an eventual shift to a pull economy, with a consequent change in procurement processes and roles.

AUTOMATION OBSTACLES The dynamic behind Industry 4.0 promises to take data from a variety of underlying systems and processes (e.g., spend, ERP, supply, inventory and production), and make increasingly automated actions. The impact of these actions would, in turn, update the optimization of the whole, for a virtuous circle that connects the pull side of demand to the supply side of incoming raw materials.

In a procurement setting this might mean triggering an e-auction or e-RFP. This extreme automation is occurring in fits and starts. Why? There are a number of reasons, ranging from technical and organizational to economical. For one thing, the underlying systems still exist in silos, and the necessary interoperability standards are still evolving.

Nevertheless, not all companies or people are ready to have their roles radically changed, but that’s why change management exists. The people 26

and processes of the procurement departments of today will be quite different in 10 years.

Preparing for procurement transformation requires participation from all professional levels.

Corporate leadership needs to be forward-thinking and strategic. Current directors and managers need to watch the technology landscape, in particular, and be open to pilots. New hires should be open minded, curious and willing to be on projects or teams.

The necessary investments in IoT technology also present its own set of obstacles. Consider that in some sectors, such as mining and industrial agriculture, production equipment may be a mile underground or four miles out in the fields. In the steel industry, it’s common to have 100-yearold equipment, and upgrading or retrofitting this infrastructure won’t be easy or cheap.

Rather than jumping the gun on an exhaustive technological renovation, we can expect tests and pilots with humans acting as guardrails. Managerial oversight is still a job best suited for humans, especially when creating a comfortable transition for how much the company or the consumer will tolerate.

Given these arduous challenges, it’s unlikely that Industry 4.0 will appear quickly or uniformly.

For those looking at where to start, the lowhanging fruit will be internal to each organization because optimizing internal processes won’t require a world of standard protocols to get started.

Many businesses have already begun the transformative process. By implementing strategic procurement platforms, which use machine learning to evaluate partners, performance and contracts, they’re already reporting significant impacts on their supply chains. Yes, Industry 4.0 will supercharge this data-informed model, but it won’t drift far from today’s ultimate goal: delivering quality products, on time, at a competitive price.

The components are there. The plan is in place. All we need now is time, money and commitment.

ABOUT THE AUTHOR RON SUMMERHILL is a senior consultant within the ASO product division of JAGGAER and lead member of the Best Practices Center. He has over 20 years of supply chain experience, including roles as a division procurement manager for Coca-Cola Enterprises and purchasing manager for Carpenter Technologies.

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2018 | www.SDCExec.com

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FEATURE

By Larry Bernstein

Defining CSR in an

INTERCONNECTED WORLD As the world continues to become more connected, companies are starting to realize the benefits they receive from becoming more socially responsible.

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early every adult knows that the word “citizenship” and can offer up a reasonable definition. However, what about “corporate citizenship?”

What does it mean to be a good corporate citizen and practice corporate social responsibility (CSR)?

In today’s world, it is no longer acceptable for corporations to simply focus on the bottom line and stock prices. Businesses are now expected to practice CSR and care about the society around them.

Navigating this complex area in a way that both satisfies one’s shareholders and conscious can be demanding. Yet, these challenges and questions are more complex for those involved in the supply chain.

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DEFINING CSR Although CSR can be defined in many ways, it mainly focuses on business’ behavior that takes into account the world around it while trying to better it in some way. What CSR is and how to be a good corporate citizen can vary depending on the company.

CEO of Transparency One Chris Morrison defines CSR as, “companies taking the initiative to change some fundamental aspect of their business for more sustainable and/or socially responsible practices.”

For some companies, CSR is defined more granularly as it’s baked into their mission.

LaborVoices enables corporations to learn about working conditions in their factories via crowdsourced intelligence from factory workers.

Kohl Gill, CEO of LaborVoices, defines CSR as, “how companies maintain their license to operate in various markets. They make sure they are acting ethically regarding customers, workers, environment and government. Corporations establish CSR goals and codes of conduct for themselves and their key suppliers.”

Similarly, Spoiler Alert views CSR primarily through an environmental and hunger lens.

“We don’t think food waste should be an accepted cost of doing business. While we strive, first and foremost, to create strong economic value for our customers, our company’s mission and vision is squarely rooted in environmental and societal impact,” says CEO Ricky Ashenfelter. “We view CSR as a commitment to using companies scale and competitive advantage to pursue economic growth and sustainability in tandem.”

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GOOD FOR ALL, GOOD FOR BUSINESS While practicing CSR is commendable, and is undoubtedly good for public relations, does it jive with a corporation’s mission to increase profits, raise stock values and act in the interest of shareholders? The answer seems to be yes.

In today’s interconnected world, news and actions of a corporation quickly become part of the public sphere regardless if that is the intent. Customers can speak with their wallets and make purchasing decisions based on their perception of a corporation. Brands and retailers benefit by being good corporate citizens, as consumers consider social responsibility and sustainability issues when making a purchase.

“We see the most successful CSR programs as those that don’t see it as philanthropy, but as value drivers for functions in the business,” Ashenfelter says.

Unilever is an example of a company that practices CSR and has benefited from it, with its Sustainable Living brands having accounted for 70 percent of the company’s turnover growth in 2017.

“Companies are also asking for much more detailed information on a variety of CSR topics than in the past, such as water usage, fair labor practices, cotton sustainability and workers’ rights,” says Morrison. “These practices stem often from the fact that companies are responding to changes in the market, where consumers want to know more about the products they are buying and that products are manufactured in a sustainable and ethical way. In response to this, many businesses are setting aggressive CSR goals that can only be met by identifying, mapping and digitizing their entire supply chains.”

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The public is not the only group who responds to a corporation being a good corporate citizen.

With unemployment in the United States at record lows, the competition for high-level talent is

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FEATURE fierce. While some potential employees are driven solely by salary and other related perks, many also consider a corporation’s mission and its role as a corporate citizen. Recruiting challenges can be eased when a company has good social values.

In addition, some employees are willing to take less pay to work with a company that is a good corporate citizen. Impact may be seen in employee behavior and retention. A motivated seasoned staff should lead to improved economic performance by the corporation.

Every corporation, particularly those engaged in some capacity with the supply chain, work with other companies. Companies with good reputations will discover it’s easier to find businesses to work with. Gill notes that CSR has a heftier impact on institutional customers for suppliers.

“Companies can absolutely impact their suppliers, and suppliers can impact their customers.”

— RICKY ASHENFELTER “Some institutions—universities, governments and large corporations—even require suppliers to make substantial CSR commitments and prove CSR performance in order to be considered for future business,” he explains.

CSR AND THE SUPPLY CHAIN While we may be judged by the company we keep, are we responsible for their actions? Can we even influence the behavior of others?

“Companies can absolutely impact their suppliers, and suppliers can impact their customers.

Take the foodservice industry as an example.

Companies like Compass Group and Sodexo are pioneers when it comes to food waste reduction, and they’ve made public commitments about their environmental stewardship that differentiate them from other operators,” Ashenfelter says. “These commitments surely carry up the value chain, and you now see major distributors offering surplus produce or compostable packaging to meet the demand that starts from their customers.”

According to Morrison, the first step a company should take to impact those in its supply chain is to invest in the time and resources that is needed to identify the supply chains for sustainability and social responsibility risks.

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“Improving the practices of direct suppliers is always a good place to start to start, but leading companies for sustainability are now enforcing policies and best practices through the entire supply chain, down to the raw material where the impact is often the greatest,” Morrison says.

Customers can make an impact by simply asking questions. The right ones can spur suppliers to act, making clear that the customer is concerned and interested in how business is being conducted.

Yet, questions do not always ensure action.

Sometimes, financial muscle can be used to inspire CSR performance.

“Some customers cut off suppliers when they do not follow-through on their CSR commitments.

Even if a company is not the majority buyer from a factory, they can still cause factory owners to reconsider how they do business,” Gill explains.

Engaging with the supplier can also lead to a change in business practices.

“In today’s interconnected world, collaboration between companies and their value chain partners is essential to implementing CSR initiatives.

Collaboration can range from data sharing to coalition building to education,” says Ashenfelter.

“For example, in April 2017, Walmart launched Project Gigaton, which invites its suppliers to commit to GHG emission reductions resulting from operational and supply chain initiatives.

Walmart partnered with NGOs to develop an educational toolkit that highlights the business case for why suppliers should consider joining the initiative.”

As companies continue to determine what being a good corporate citizen means to them, they can examine their own mission and that of their supply chain partners. Practicing CSR can be particularly impactful as it can touch the others in the chain. Guiding other companies so that they are good corporate citizens can be time consuming, and requires education and goal alignment. This investment is worthwhile in many ways including the bottom line.

ABOUT THE AUTHOR LARRY BERNSTEIN is a freelance writer based in North Jersey.

He writes for a number of markets, including business, construction, retail and education. His articles have appeared in such publications as Construction Magazine, RIS News and The Chronicle of Higher Education.

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2018 | SDCExec.com

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FEATURE

By Lara L. Sowinski

GLOBAL FORKLIFT MAKER FINDS

SUCCESS BY BUCKING THE NORM

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oday’s business environment is dominated by disruption, with new technologies, consumer expectations and manufacturing capabilities working in unison to ignite wholesale change across the entire ecosystem—one that is progressively driven more by the consumer and end-user, as opposed to the manufacturer and retailer.

The forklift sector may not come to mind as a hotbed for disruption, yet Ireland’s Combilift has been steadily carving an alternative path to success since it launched in 1998. The founders, Robert Moffett and Martin McVicar, combined their engineering talent to design the world’s first internal combustion engine powered, all wheel drive, multidirectional forklift—and the Combilift was born.

Twenty years later, Combilift is now the largest global manufacturer of multi-directional forklifts and a leader in long load handling solutions. Over 40,000 Combilift forklifts in a variety of purposebuilt designs are used in more than 85 countries. In April, the company opened a new 500,000-squarefoot manufacturing facility in County Monaghan to support its rapid global growth, especially in North America—its fastest growing market.

Members of the media were invited to tour the 32

Photo by Cynthia Y. McCann

Mass customization, innovation and complimentary warehouse design services contribute to a winning strategy for Combilift and its customers, who are looking for alternatives to traditional design and manufacturing practices.

new facility, meet the Combilift team and learn more about the company’s business strategy.

McVicar, managing director of Combilift, credits mass customization for the company’s success.

“Mass customization is the new frontier for both the customer and the manufacturer. Increasingly, customers are expecting products to be tailored to meet their needs. Forklift producers that offer customized products generally produce low volume, but Combilift is setting the benchmark by offering the mass production of tailored products, resulting in a strategic advantage for our customers,” he says.

“Traditional forklift manufacturers focus on highvolume mass production of the same products. We evolve with our clients, producing new products each year.”

A robust research and development team supports Combilift’s mass customization approach.

Innovation is a competitive advantage at the company, and Combilift holds numerous design patents. Engineers work closely with customers to customize products designed for their specific needs. The company even offers complimentary logistics and warehouse design services.

“Our engineers proactively design, plan and produce solutions in collaboration with our

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2018 | SDCExec.com

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customers by offering material flow analysis and 3D animations,” says McVicar. “We work with customers to produce warehouse designs to visualize the capacity potential as well as the optimum flow of materials on their site.”

Combilift holds numerous design patents and also invests 7 percent of its annual revenue in research and development (R&D), which not only enhances its customization capabilities, but also maximizes ROI for its customers.

“The flexibility in our new facility means that we can continue to accommodate any request for a customized material handling solution,” explains McVicar. “We also see ourselves as much more than a forklift manufacturer, and are transforming the transport and logistics sector with our innovative, space-saving products and services.”

Indeed, the new facility actually has much less automation than many other modern

manufacturing facilities. This allows for a lot of flexibility and customization. Currently, it operates four 90-meter moving assembly lines that can produce a finished truck every 15 minutes. The new facility will also allow Combilift to double its output in a single shift across all production lines.

There’s much more that sets Combilift apart.

Mechanically, the company is able to maintain simplicity despite the high degree of customization.

This allows Combilift to use standard and readily available parts and components so the products can be easily maintained and serviced in any part of the world.

“A competent auto mechanic can repair a Combilift,” remarks McVicar.

In addition, the company is loyal to its core suppliers, many of which have been supporting Combilift for the past 10 to 15 years, McVicar says. “We want to stay with the suppliers we know, and we want to grow with our suppliers.”

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FEATURE

By Steven Brandt, ProShip, Inc., Director, Automated Packaging Solutions, NA

THE SECRET 3PLS DON’T WANT YOU TO KNOW… Automating the packaging process and the major gains that come with it.

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verything in the third-party logistics (3PL) industry is accelerating, it is an instant-everything world and companies want parcels packaged and delivered ASAP at the lowest cost possible! As companies search for cost saving opportunities to meet this demand, order packaging is one of the fulfillment processes that continually gets overlooked. In most cases, order picking, put walls and shuttle systems are the only areas analyzed to discover any cost saving opportunities. But in reality, order packaging can be the most manual and labor-intensive part of the formula, leading to higher overall costs. With parcel growth predicted to rise 17 to 28 percent through 2021, 3PL providers must investigate all parts of the order fulfillment design to stay competitive.

A COMPLEX PROBLEM Some argue that robots threaten millions of jobs, but that is not the case within the 3PL sector. The dwindling order fulfillment labor force is facing major

skill shortages, and companies are finding increased competition for warehouse labor and an aging workforce.

This means what was once simply a gap is now a crisis.

Only making this crisis worse, the average parcel shipped is 60 percent air! With some carriers charging users dimensional (DIM) weight of parcels instead of the actual weight (when the DIM weight total is higher), large but lightweight parcels incur unnecessary high shipping costs. To avoid upcharges, shippers must package orders into the smallest possible parcel in order to receive the lowest DIM weight and shipping costs.

Exposing this process to human error isn’t an option anymore, and overcoming these challenges isn’t easy.

E-commerce and 3PL providers can reduce labor and parcel sizes while decreasing use of shipping materials by utilizing innovative packaging solutions.

AN AUTOMATED PACKAGING SOLUTION FOR INCREASED EFFICIENCIES The CVP Automated Packaging Solution by ProShip, Inc. is an in-line autopacker that optimizes all steps of package fulfillment. The solution creates a fit-to-size box around every order and can handle single or multi-item orders. This solution measures, constructs, tapes, weighs, and labels each custom order every seven seconds with only one operator, and will create the perfect parcel and reduce or eliminate the need for void fill materials.

“We are always looking to be at the forefront of automation within the supply chain and are proud to have been the first company in the world to use the CVP,” said Ingram Micro, a multi-billion-dollar 3PL provider of information technology products.

This machine continues to be a proven strategic tool for the third-party logistics industry, including companies like Ingram Micro and CEVA Logistics in Europe, but also supports companies in e-commerce, retail, manufacturing and many other industries world-wide.

LABOR GAINS TO COMBAT THE LABOR CRISIS The CVP Automated Packaging Solution is engineered and proven to alleviate the labor-intensive packaging process. This system saves companies an 34

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average of 88 percent in labor costs and eliminates eight to 15 packing stations. Workflows continue to run smoothly throughout the year and minimize the need for laborers, especially when peak production periods are experienced. The CVP does not take any vacation or sick days, allowing companies to run a lean operation, shorten the packaging process and fully support shipping demand 24/7.

“Automation is crucial to our company as we work with short delivery times. And we have a lot of customers, about 35,000 who we serve with just 26 employees,” said Richard Rensen, owner of The Label Collective Group.

“The CVP allows us to pack parcels much faster.”

REDUCE SHIPPING COSTS TO SAVE THOUSANDS The CVP handles a diverse product mix and reduces the dimensions of every order by building the minimumsized box required. “Packaging is more efficient and cheaper. We don’t need any filler materials to protect the product,” said Rensen. “And as the CVP packs much tighter around the product, we have less damage.”

Additionally, if shipping costs are DIM weight dependent, this innovative technology provides users an average of 45 percent shipping savings. This allows the per unit parcel cost to be significantly lower.

REDUCE CORRUGATE MATERIALS TO ADD TO YOUR COST SAVINGS The CVP consumes only the minimum amount of corrugate required when creating each parcel, saving companies an average of 29 percent in corrugate material. In addition, ProShip does not require a longterm corrugate commodity contract and customers can purchase corrugate directly from suppliers.

Multiple box size inventory is significantly reduced by utilizing one corrugate fan fold width, eliminating over dozens of box inventory SKUs. Pierre Yves Escarpit, director of operations at Cdiscount, France’s leading online retailer with almost four-billion-dollars in sales and over 30 million products available said, “With the CVP, we are now able to completely adjust the size of the parcel to the size of the goods which make up an order. This is a breakthrough and major step forward, not only in relation to our carbon footprint, but also in terms of economic impact.”

carriers, choose the lowest cost, and print carriercomplaint labels for every parcel. There are many additional customization options available, including an Automatic Document Feeding System to insert printed documents in each order, such as invoices, packing slips or return labels.

ProShip offers many service options that are customized to fit every customer’s unique needs, including remote support, daily reporting, on-site services, parts support, product training and software maintenance. ProShip values each customer and our support team makes a personal commitment to deliver the best customer experience in the industry. The company’s number one priority is to ensure customers meet or exceed their production and service levels by providing direct customer support.

A NEW WAY FORWARD The order fulfillment process is the lifeblood for third-party logistics providers and many other industries, and an automated packaging process can change everything, including transforming your packaging function from a cost center to a profit center. The CVP Automated Packaging Solution by Proship, Inc. ensures all steps of the package fulfillment process are optimized and helps you stay ahead of the competition. It is an investment with huge returns.

ProShip is beyond the box, your business should be too. It’s your turn to expand your business potential in today’s challenging market with the CVP Automated Packaging Solution. Contact us now for more information about the CVP solution, the ROI opportunities, or a no charge consultation to see if the CVP Automated Packaging solution can save your business on labor, shipping, and corrugate costs.

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INTEGRATION ADVANTAGES WITH 24/7 SUPPORT The CVP integrates seamlessly with automated shipping software, which will rate shop among your

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SPECIAL REPORT PROCUREMENT

By Amy Wunderlin

A ROAD MAP TO SUCCESS With the right strategy in place, procurement can add business value in ways we’ve yet to see.

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ot having a procurement evaluating any strategy should start strategy is like going on with an honest assessment that asks, a cross-country road trip “Where are we today?” without a map or GPS, “That honest assessment is says Jennifer Ulrich, Source One’s fundamental to say, ‘where do we want associate director and procurement to get to?’” Clark says. transformation practice lead.

Ulrich adds to keep in mind that “There’s a good chance you will get there is no one-size-fits-all approach to where you want to go, eventually, but it managing your procurement function. will likely be a long and laborious trip “Your procurement strategy should with quite a few dead ends,” she adds. be built around several factors that are A solid procurement strategy specific to your organization—from a is a primary building block for financial and geographic standpoint organizations to your industry, that are keen on “YOUR PROCUREMENT STRATEGY your business controlling costs GIVES THE FUNCTION DIRECTION model and even and maintaining different AND A BASE PURPOSE TO BUILD the compliance categories your FROM. WITHOUT THAT END GOAL procurement with internal IN MIND, IT’S DIFFICULT TO and external team determines regulations and CREATE A PATH TO SUCCESS.” the most safeguards. While strategic,” she — JENNIFER ULRICH procurement is says. “The best often seen wearing the compliance hat, approach in my opinion is to use a today with the right strategy in place, blend of different strategies to deliver it can add business value in ways we’ve the most value to the business.” yet to see.

For Clark, the best strategy should “Your procurement strategy gives the be rooted “in a deep understanding function direction and a base purpose of how things are today.” That’s why to build from. Without that end goal an honest and objective assessment in mind, it’s difficult to create a path to of how procurement is performing success,” says Ulrich. within an organization is essential to What that path will look like is up understanding where a company is to you. strong and where gaps may exist.

A solid assessment of your company AN HONEST ASSESSMENT versus top performance in your sector According to Wayne Clark, vice can also help you set specific goals. president of global delivery at GEP, For example, after completing a while implementing processes for self-assessment, a consumer packaged a procurement strategy will vary goods company GEP works with was significantly depending on the able to set very explicit goals, which company itself, its sector and its included being top quartile in terms maturity level, the first step in reof performance metrics for their direct

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SPECIAL REPORT PROCUREMENT

materials because it’s such a large part of their cost model. But on the indirect costs, which is highly complex at their firm, they decided they were content in matching their competitors due to the added cost and investment required to really improve that area of their business.

“That level of focus helps to build the roadmap that gets you there,” Clark adds.

A VISION OF FUTURE STATE Determining procurement’s strength and weaknesses within an organization and then setting specific goals is the next step in defining a vision for the future state of the department.

“Number one should be to find your vision,” says Marcell Volmer, SAP Ariba’s chief digital officer. “What do you want to do, and what is the role you want to play as a procurement function? Number two, you should have a strategy in place with defined steps and objectives. Number three is to execute on that, and measure the outcome.”

In Volmer’s previous role of chief procurement People & Overall officer (CPO) at SAP, he Capabilities oversaw an organizational procurement transformation. Today, he helps other companies do the same. He says in defining a vision, companies must be open and honest, asking questions such as, “What is really the value I can contribute in the future? And what is the strategy to executing on that?”

“It’s definitely important that you think about the future and where you really can generate value for your organization,” Volmer adds.

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GEP’s Clark notes that a good procurement strategy ultimately sets the vision and the goals.

“A strategy is really defined to say, ‘What are our core priorities, and what approach are we going to take to get there?’ It’s as much about defining what we are going to do and how we’re going to do it well. It’s also got to do with resource allocation, asking, ‘What are we perhaps not going to do?’” he concludes.

THE ROAD MAP

in procurement, you definitely have a beautiful spot where you can do that.”

Volmer adds that your re-evaluated procurement strategy should impact three main priorities: supply chain innovations, risk management and sustainability.

Executing on a procurement strategy won’t happen overnight, however.

Clark says the road map to getting there could be a three- to five-year plan made up of a series of projects.

“It’s not boiling the ocean and trying to redo the 150 sub-processes within the source-to-pay world. It’s about understanding which of those 150 processes has the biggest impact on getting us to that future state vision,” he adds.

If you haven’t started to re-evaluate your procurement strategy, Volmer says you are already too late.

“It’s a little bit controversial, but some think procurement will last forever; I doubt that. If they are not changing, it will not last forever, is my personal opinion,” he warns. “A lot of CPOs might think, ‘I can sit Performance and wait.’ I tell them, ‘No you can’t.’ & Results Because everybody needs to think about how to impact the future business model and how to create impact. And

“THERE’S A COUPLE OF DIMENSIONS TO PROCUREMENT STRATEGY. THERE’S THE TECHNOLOGY AND THE DIGITAL TRANSFORMATION SIDE… BUT THERE’S ALSO THE PEOPLE AND OVERALL CAPABILITIES COMPONENT OF A STRATEGY. AND THERE’S A DIMENSION AROUND Technology THE PERFORMANCE & Digital Transformation AND THE RESULTS.” — WAYNE CLARK

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SPECIAL REPORT PROCUREMENT The road map will also have multiple issues, which include having standard fundamental component of the workstreams, Clark says, comprised of processes in place, the best talent procurement strategy,” Clark says. your people, your processes, and now handling those processes, and the right “Historically, we would normally today more than ever, your technology. metrics and reporting to demonstrate look at the end-to-end procurement “There’s a couple of dimensions operational efficiency. These processes and think about how to procurement strategy. There’s topics come before the technology. technology can better enable certain the technology and the digital Procurement should be enabled by steps as a tool that’ll help manage the transformation side…but there’s also technology, not reliant on it.” workflow, capture information, make the people and overall capabilities Clark agrees, explaining results things simpler and automate steps. But component of a strategy. And there’s have also been a top priority for that ship has largely sailed. a dimension around the performance procurement—how to deliver better “Now we have new technologies and the results,” Clark says. “Among value to the organization, primarily in that not just automate processes but looking at the digital strategy, the the form of savings and more strategic can help challenge and rethink the people strategy, and the performance support to the lines of business—and very nature of what procurement and results component of the strategy, for most CPOs that is still true. activities are. We moved away from, I would also add data as part of ‘do I have tools to support that digital piece. With a data each step of the process?’ to “WE MOVED AWAY FROM, ‘DO I HAVE TOOLS saying, ‘are there tools that can strategy, those become the real components. And they need TO SUPPORT EACH STEP OF THE PROCESS?’ TO help me rethink my model to be addressed holistically not SAYING, ‘ARE THERE TOOLS THAT CAN HELP completely?’” he adds. one at a time.”

This means the technology ME RETHINK MY MODEL COMPLETELY?’” Source One’s Ulrich also component of procurement must — WAYNE CLARK notes it is important to track move away from a tool strategy the success of your strategy or and toward a data strategy. strategies to see what works best for “The value that procurement creates “A data strategy wouldn’t have been your business. doesn’t really change with these emerging a particularly prominent component to “Set up metrics and KPIs from the technologies. It just creates some a procurement strategy five to six years beginning of instituting a strategy,” opportunities or some risks,” he adds. ago, but now it’s sort of a backbone she says. “With the right metric But nonetheless, the role of element,” Clark adds. methodology in place, you can quickly procurement has changed and will “Procurement has really matured determine what works from a strategic continue to do so. Now is the time to as a corporate function to be almost standpoint and what does not, so that re-evaluate your strategy to include the unrecognizably different than it was 15 you can course-correct as needed with impacts of the digital supply chain. years ago,” he continues. “We’re seeing more agility.”

“It is time now to change and think clients reach out to us that are on the about the future, and [procurement] very low ends of maturity saying, ‘Hey, DIGITAL STRATEGY is in a unique position where it can we’re just waking up to the possibilities It’s hard to talk strategy without define its own future,” Volmer notes. here. We know we’ve been focusing on mentioning technology. While Ulrich “You might not have the chance in five other aspects of our business, but we’re acknowledges that the looming era of or 10 years. So better do it now, and ready to think about how we can take digitalization is probably the biggest start early.” procurement and reach a mid-quartile topic in procurement at the moment, And because there is almost no or third-quartile level of performance.’ she says many procurement executives distinction between a procurement “And we have clients that are already are just starting to understand that strategy or a digital strategy, Clark performing; they’re best in class in technology is something they need to says you must think of them as one their peer group, and they are reaching start thinking about. integrated set of questions, asking out saying, ‘Help us understand how “It’s a major component that is being “how can procurement deliver higher these new technologies may create built into long-term procurement value? And how is technology going either opportunity or risk for us, and strategies,” she says. “This one point to enable that in new ways that weren’t more importantly, help us understand is actually driving organizations to even imaginable just a few years ago?” how we can leverage them to maintain think about some of the other big “Technology is absolutely a our leadership position.’”

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SPECIAL REPORT

By John R. Yuva

Sensing

THE INTERNET OF THINGS

THE SUPPLY CHAIN While barcodes and QR codes are still widely used as sensors in the supply chain, it’s the need for analytics and predictive data that’s driving an evolution in sensor technology and usage.

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s a truckload of fruits and vegetables heads down an interstate, a vehicle blows a tire causing sudden braking with debris damaging the reefer’s generator. Nearly 200 miles away, a warehouse supervisor receives data notification from inside the reefer that severe shock and vibration occurred and that the internal temperature is slowly dropping.

Because of sensors throughout the reefer trailer and within the pallets of perishables, the 3PL was able to inspect and transfer the cargo while preserving 80 percent of the load.

This is the power of sensors in the supply chain.

They can provide full transparency of assets from raw material to lastmile delivery and beyond. According to The 2018 MHI Annual Industry Report, released by MHI and Deloitte Consulting LLP, 56 percent of survey respondents believe sensors and automatic identification technologies have the potential to disrupt or create competitive advantage. Additionally, 90 percent of respondents believe sensors and automatic identification are technologies expected to impact supply chains over the next 10-year period.

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ROLE OF SENSORS Those impacts can range from inventory management efficiencies to asset security, to operational effectiveness, to automated technology enhancements. What do companies want to achieve with sensors? That depends on whether the goal is to gather or capture data.

Sameer Agrawal, general manager of IoT at Honeywell Safety and Productivity Solutions, says gathering data includes tracking such things as temperature, shocks, humidity and the like. People continue to push the envelope on data gathering because the sensing technology elements are much more affordable. “Consider a shipment of blueberries where it’s not only temperature that’s critical, but shock and tilt as well,” he says. “With Internet of Things (IoT) advanced technologies, combinational sensors are available that can provide a second or third order of magnitude.”

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“THE ADVANTAGES BEGIN WITH THE EFFICIENCY OF AUTOMATIC DATA COLLECTION, BUT THE RIPPLE OF DOWNSTREAM CONSUMPTION OF THAT DATA IS FAR GREATER THAN THE EFFICIENCIES UPFRONT." — PAUL BABOIAN

Data capture takes things steps further by processing sensing information in formats that allow for decision-making and risk mitigation.

Paul Baboian, enterprise IoT/RFID solutions manager for Barcoding Inc., says companies are in the infancy stage of using sensors within the supply chain that are more local to the material loads— providing data-rich information at every supply chain segment in near time to real time. What makes this possible, says Baboian, is the advancement and convergence of technologies, such as the cloud, blockchain and cellular data.

“Business applications consuming sensing data provide more accurate, more timely information about material move transactions,” explains Baboian. “The advantages begin with the efficiency of automatic data collection, but the ripple of downstream consumption of that data is far greater than the efficiencies upfront. We’re one of many that build customized dashboards to quickly gain information about shipments and where they are in the supply chain. Whether it’s pallets or parts, the dashboards can be integrated into a warehouse management system or inventory control application to leverage new, enhanced sensor data for greater supply chain visibility.”

RFID AND NFC SENSORS There are several types of sensors that provide both data gathering and capture capabilities. One of the most common is radio-frequency identification (RFID). With a decrease in the cost of ownership and installation, use of RFID can be found in myriad environments, particularly within logistics. Another type of sensor is near field communication (NFC), a 40

technology that has its own advantages in a warehouse or similar environment.

RFID: Mainstream utilization of RFID occurred several years ago when Walmart and the Department of Defense announced RFID projects and mandates.

Baboian says RFID has become more plug-and-play since then, with greater sensitivity built into RFID tags and antennas.

There are now specialty-use tags and antennas for many different use cases.

“Regardless of the company or supply chain, the business case must exist for RFID to be effective,” says Baboian. “Large Fortune companies are not the only benefactors. There are small business enterprises undertaking high-value logistics initiatives that leverage RFID technology. The ROI is there due to compliance requirements where chain of custody or track and trace visibility is enhanced.”

One industry where the business case is proving profitable is retail. Dean Frew, chief technology officer and senior vice president of RFID solutions for SML Group, a RFID solution provider for retailers, says RFID provides the ability for two things that existing barcodes do not. “First, it provides rapid non-line-of-sight data capture. And second, it provides the ability to monitor at the item level.

Both are transformational in supply chains and in stores,” says Frew.

He estimates that the market is only approximately 9 percent penetrated with significant room for growth.

RFID adoption is growing at a rate of more than 30 percent a year in the retail apparel space, with the main focus being management of inventory in stores. Over the next 10 years,

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Frew anticipates the market to grow where there are more than 30 billion items per year using RFID tags in the apparel and footwear market to improve inventory accuracy.

“Currently, inventory accuracy for retailers is somewhere between 65 percent and 75 percent at the SKU level, illustrating a significant opportunity for improvement. RFID tags and readers are becoming more sensitive every year and we can expect this to continue,” says Frew. “As well, we’ll begin seeing RFID-enabled robots roaming the stores performing stock counts become more prevalent in 2019-2020.”

Just as in retail stores, factories and distribution centers are wrought with poor inventory accuracy at the SKU level, adds Frew. This causes simultaneous stockouts and bloated inventories; costing enterprises billions of dollars every year. “As more retailers adopt RFID in their stores, we’ll see more and more usage of RFID in factories and distribution centers to improve accuracy around processes like receiving, picking, packing and shipping,” he says.

“We are already seeing this trend play out with some brand owners.”

NFC: Similar to RFID is NFC—with a few exceptions. The reader technology for NFC is now cellular phoneenabled. Thus, an application on a mobile phone can scan NFC tags rather than relying on specific (and expensive) reader hardware. Where NFC falls short of RFID is its scanning range and data-tag collection.

NFC requires a reader at close range (20 centimeters) with the associated goods to obtain a data reading, while RFID readers can scan a truckload of tags instantly (within several meters).

Agrawal says NFC is regarded as another data capture mechanism.

Whether it’s NFC, RFID, Bluetooth, Zigbee or Wi-Fi, all are different mechanisms capturing the sensing elements at the source and communicating them to an aggregator that transmits the data to the cloud or local processor to initiate decisionmaking.

“NFC is much more efficient than manually capturing the data, but the reader must be in close proximity to read the tags—a potential challenge from a supply chain standpoint,” says Agrawal. “Also, the use of any and all cellphones as an NFC reader is not ubiquitous. While Android devices are more open, iPhones offer limited access to NFC features. The kiss of death of any sensing application is the need for specialized pieces of equipment.

The more ubiquitous the readers and technology are, the better the value that’s created and the decisions being made for the sensing performed.”

IOT SENSORS Both RFID and NFC sensors are well-integrated into many supply chain operations.

With the advent of IoT, however, the possibilities for sensing technology have only just emerged.

With the push toward Bluetooth and other data capture technology, expectations are rising for what is achievable, says Agrawal. ❯❯ The use of consumer electronics and cellular technology for data capture should drive costs down on the sensing side. ❯❯ There exists automated capture of data which streamlines the process by eliminating steps such as locating data loggers in shipments and requiring a

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computer for data access. ❯❯ With the onset of the cloud, companies can achieve targeted dissemination of information where actions are performed “in time” during a shipment journey rather than interpreted postmortem.

Honeywell and Intel partnered on an IoT-sensor initiative focusing on four critical issues impacting shipments—damage, spoilage, theft and contract non-compliance. The two companies created a combination sensor tag that signals light detection, vibration, shock, temperature, tilt, humidity and presence. The lowcost, disposable sensor tag can be used in multiple environments and different supply chains, while relying on standard consumer technologies, such as Bluetooth and Zigbee, for data collection and transfer to a centralized cloud environment.

“We wanted to create a path of least resistance where the cost is manageable. By using large-scale consumer electronics technologies combined with combination sensors, you can begin performing different levels of analytics,” says Agrawal.

“Those analytics not only provide a picture of what just occurred and how to respond, but what is about to happen and how to avoid those events from transpiring.”

The ultimate goal of using sensing technology is to provide the right information to the right person at the right time. Otherwise, it will always be a postmortem evaluation of the data rather than using it in real-time to prevent problems. Agrawal says companies should continue forging ahead to say even before a problem occurs, how do we make it more predictive? “The requirements are becoming mature where a threshold doesn’t need to be crossed,” he says.

“The trends will start driving the action.”

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SPECIAL REPORT

By Eric Rempel

BLOCKCHAIN

OBSTACLES REMAIN FOR BLOCKCHAIN ADOPTION

in Supply Chain

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lockchain is here, and meaningful applications using this revolutionary technology are on

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VISIBILITY

their way.

In simplified terms, blockchain is a decentralized leger to which events and data can only be appended. Blockchain can dramatically improve data security, provide business-to-business (B2B) transparency, and most importantly, trust.

Like all things new and shiny, blockchain’s potential as a transformative technology seems limitless. Through the lens of a technical maturity perspective, blockchain technology as a whole has moved past the peak of inflated expectations, as displayed in the Gartner Hype Curve Model (to the right). Depending on your perspective, it’s likely headed down the trough of disillusionment, or perhaps inching its way up the slope of enlightenment.

Proven blockchain technologies, such as Bitcoin, demonstrate that the slope of enlightenment and plateau of productivity are not too far away for the masses. However, between now and the point of time where people will seek to use the technology, there are still numerous challenges to face. Three top challenges include uniformity, adoption and scale.

The right balance of uniformity, adoption and scale is the driving force behind usage industry-wide.

PEAK OF INFLATED EXPECTATIONS

PLATEAU OF PRODUCTIVITY SLOPE OF ENLIGHTENMENT

TROUGH OF DISILLUSIONMENT TECHNOLOGY TRIGGER MATURITY

UNIFORMITY Uniformity brings a sense of calm, and not simply for developers. It brings a greater significance to businesses and its leadership. Standards allow those communicating with each other to understand and interpret meaning from a message or transaction. Even without blockchain as a consideration, uniformity is a massive challenge for all businesses today. What is a bill of lading? What goes in the document?

How is the document structured? Do I need to reply to the sender or just accept the data and move on? These are all enterprise integration questions that need resolution before blockchain solutions can be widely adopted. Much

According to Gartner, the Hype Curve Model provides a conceptual representation of five stages of a technology’s maturation.

like people, systems have to speak with one another using a library of words they’re programmed to understand.

Agreeing to a common, uniform language is the central step toward integrating blockchain with the supply chain industry.

ADOPTION Adoption, unlike uniformity, is a product of critical mass. Anyone can define a “standard,” yet for a standard to have real business value, others need to use the same standard. In a

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business world where IT resources are solutions, coupled with new and easyBlockchain adoption requires millions backlogged, value will be the primary to-use business intelligence systems, of enterprises to be digitally ready to force driving adoption. organizations are evolving faster than transact in real time.

The next challenge with adoption ever. Adopting these technologies and is simply integrating B2B transactions architecture patterns will not only SCALE via the blockchain. Currently, solve data management and movement Scale, unlike uniformity and challenges with B2B transactions are problems for digital businesses, but also adoption, presents new, unseen plentiful without even considering prepare them to interact with new and challenges for blockchain use in the blockchain. promising blockchain applications for supply chain. Questions like, “How Integrating business systems, supply chain. large will the ledger need to be?” whether on-premise or cloud based, is But what about the rest of us—the and “How will businesses run these a necessity for growth, but the cost and majority of organizations that lack transactions cost-effectively?” are on effort to manage and implement digital the internal IT skills to pull off digital the minds of many bright developers, business transformation is not for the transformation? Consulting firms are but the answer remains somewhat faint of heart. In order to effectively certainly an option, but full digital obscured. Partially because of the participate in a blockchain ecosystem, transformation without internal lack of uniformity and adoption, but members will need to have fine-grain sponsorship and leadership can easily mostly because of two main metrics: control over transaction transmission, end up becoming a requirement and transactions per second and cost per validation, security, translation, funding nightmare. transaction. Clearinghouses that enrichment and more. Businesses process a transaction and then will also need to have expertise compute the chain on your behalf With the exception of some in sending and receiving reallater are one solution, but they pharma and closed-loop food time transactions from its various can be hacked, and the third business systems. would need to be highly supply chains, blockchain doesn’t party So, how do businesses prepare trusted. Another emerging for the blockchain in supply solution are sidechains, which provide significant ROI yet. chain revolution? The answer, break down the transaction counter-intuitively, is to focus on There is an alternative in the into smaller and easier-to-compute systems integration rather than middle where organizations can transactions where a master blockchain focusing on blockchain at all. fast-forward digital transformation branches to smaller chains representing Again, it’s difficult for a business via specialized integration platforms. detailed data. However, this solution to make a case for anything without You may currently know them as value just kicks the can down the road, as relatively fast return on investment. added networks (VAN). For decades, sidechains need to be computed at With the exception of some pharma VANs have been a trusted partner least twice, therefore facing the same and closed-loop food supply chains, for B2B connectivity with electronic long-term challenge. blockchain doesn’t provide significant document interchange (EDI). Today, Until quantum computers are ROI yet. Therefore, its important to organizations providing these services commonplace, the scale challenge go back-to-basics and prepare your via platform-as-a-service (PaaS) might be solved by a computing or business for the digital revolution techniques are doing the same thing, algorithmic breakthrough. More already underway. Businesses are but for more complex business process likely, a good balance of uniformity already adopting new enterprise transactions rather than for just EDI and adoption will drive the right integration patterns, which enable documents. technical architecture for the next killer customer self-service, new revenue Adoption of blockchain applications blockchain app for supply chain. channels, visibility across business for supply chain does not just require ABOUT THE AUTHOR systems and the ability to see your the application itself to be meaningful entire business’ health in real time. (important for the business), powerful ERIC REMPEL is the chief innovation officer at Redwood Logistics.

Add powerful data warehouse (disruptive) and valuable (good ROI).

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EXECUTIVE FOCUS

{ TRANSPORTATION}

By Barry Hochfelder

INCREASED VALUE LIES IN THE EVOLVING 3PL The Amazon Effect, technology, the internet and consumer expectations are driving collaboration between shippers and 3PLs.

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he advent of technology, along with pressures from the globe’s largest online retailer, has forced 3PLs and 4PLs to stand up, take notice and change.

A report released by Penske, the 22nd annual Third-Party Logistics Study, touches on this, pointing out the need for 3PLs to provide new and innovative ways to improve logistics effectiveness.

Time-sensitive deliveries, the study says, along with lean inventories and shorter product lifecycles, are placing greater demands on the supply chain.

“Shippers have greater expectations of what they want their logistics providers to accomplish, and the proper alignment of those expectations is the key to guaranteeing success between both parties,” the study notes.

It’s not uncommon for industry professionals to talk about the “Amazon Effect” and how the e-commerce giant has forced everyone to change, says Paul Thompson, founder and chairman of Transportation Insight.

“It’s gone just beyond e-commerce,” he says, “because the pace at which Amazon is accomplishing e-commerce 44

is even putting [other] e-commerce companies on their toes. Today, in this consumer-driven environment, we simply can’t imagine not getting an answer to a question. If there’s something you want to know, you go to Safari or Explorer or Google, and the engines are so strong you expect to have that answer.

“In transportation services,” he adds, “a lot of companies do not have the technology tools to provide real-time information as it needs to be for visibility: Where’s my product?

Tracking, tracing, what should something cost? What is the transit date? Has it been delivered?”

Now, Thompson says, even manufacturers and distributors are trying to go directly to customers.

“Everybody is thinking about how to create and get their piece of the pie, but there’s a technology gap for them to be able to do that,” he adds.

Greater availability of data and the ability to make real-time decisions are driving both shippers and 3PLs toward more meaningful partnerships, which is leading to innovative solutions that can provide a competitive advantage for shippers. But, says Joe Carlier, senior vice president for global sales at Penske, it’s pretty complex.

“You have to factor in everything,” he says. “The driver shortage, capacity shortage, carriers going out of business. Then the cost conversation is compounded because people want more for less. A lot of customers budget incorrectly.”

The full impact of the electronic driver log (EDL) mandate still hasn’t been felt, Carlier adds. “What percentage of shippers are impacted?

I read one report that said 25 percent [of smaller companies] will face bankruptcy. I read another that said it’s over-estimated and won’t be more than

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TRANSPORTATION

5 percent. We don’t know yet. It will take until August.”

relevant. Conversations surrounding supply chain have made their way into the boardroom, and an effective supply chain can be a key differentiator between businesses in all sectors.

Many companies around the country who before considered themselves a manufacturer or a distributor agree supply chain management has not necessarily been a core competency, Thompson says, adding, “But in the

While the company, Thompson says, manages more than a billion dollars in freight, he adds “it is very difficult for a CHANGING SERVICES shipper to manage the data associated 3PLs and 4PLs exist to take on with parcel because it is very, very the role of intermediary in the order complex. fulfillment process, says Michael “We are getting hired by megaNotarangeli, executive vice president retailers now to come in and help of logistics at Maine Pointe, a global, them manage what is today a small implementation-focused supply chain portion of their total freight portfolio, and operations consultancy. but the fastest growing piece. Change “Service providers exist on a is coming. Some of the biggest continuum,” he points out. “Some “Firms can outsource execution, companies in the country that focused on flawless execution in have never gotten outside their but accountability remains with the own supply chain transportation the storage and pick, pack and ship arena, and others focused on shipper. A 3PL or 4PL is an extension departments are having to solve value-added services that extend problems and opportunities of of the firm and sits between the e-commerce. It is transforming the capability of the shipper toward the buyer end of the the market,” he says. company and its customers.” supply chain. Innovative providers Again, relationships are vital.

— MICHAEL NOTARANGELI actively seek to create value for “Reasonable sharing of the client in the distribution center to future, it has to be, so you are seeing business information can allow the maximize flexibility and keep inventory many companies trying to reinvent provider to adjust their offering at optimum levels.” themselves to have that Walmart-like, or create new capabilities to meet These services, Notarangeli adds, Amazon-like platform for information changing requirements,” Notarangeli range from basic to sophisticated, such management and customer says. as late-state customization of products, management.”

As well as being practical, assembly, configuration of electronic The Penske study, and many industry collaboration is achievable, the Penske language and documentation services, experts, say partnerships and collaboration study points out. and customized packaging. are key to making it all work.

“In today’s supply chains, Technology, at least for the big guys, Notarangeli agrees, saying successfully information flows rapidly, and there are is viable for building and expanding, managing 3PL and 4PL services require collaboration opportunities available Thompson says. collaboration, communication, wellthroughout the planning, forecasting “The irony of it is that most defined goals and expectations, and and execution phases,” the study’s companies have pretty good operating agreed upon governance. authors say. “The real-time exchange systems, and they have pretty good “Firms can outsource execution,” of data allows companies to make warehouse management systems, he says. “But accountability remains decisions earlier, which can minimize but they don’t have transportation with the shipper. A 3PL or 4PL is an the ripple effect of supply chain management systems, and they don’t extension of the firm and sits between disruptions. By providing increased have integrations across the motor the company and its customers. With visibility, 3PLs have an opportunity to carriers,” he says. the proper working relationship, a 3PL, provide greater value.”

4PL partner can provide a competitive ABOUT THE AUTHOR SUPPLY CHAIN’S ROLE advantage in the marketplace.”

BARRY HOCHFELDER is a freelance According to the Penske study, Transportation Insight recently met journalist who has covered a variety “the growth of e-commerce, increased with a large Fortune 100 retailer to discuss of industries in his career, including consumer demands and the speed the parcel segment and answer questions supply chain. He also served as the former editor of Supply and Demand Chain Executive. at which new technologies enter the such as, “Are shipments on time? Are any Hochfelder is based in Arlington Heights, Illinois. market makes the supply chain more lost, damaged? What’s our cost?”

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EXECUTIVE FOCUS

{ WAREHOUSING}

By Lara L. Sowinski

CALIFORNIA’S INDUSTRIAL REAL ESTATE MARKET

STAYS HOT

I

E-commerce, cannabis and strong activity at gateway ports drive continued growth.

by the numbers Industrial Real Estate

ndustrial real estate across the United States, and California in particular, is enjoying a boom. According to online real estate trading platform Ten-X, vacancy rates in the sector hit a record low 7.3 percent in 2017, down from 8.1 percent in 2016, and this year’s industrial vacancy rates are on track to hit another all-time low.

Metro markets in California, including Los Angeles, San Jose and San Francisco, are especially poised for investment, says Tex-X, thanks to strong demand from cloud computing and legalized cannabis industries, while e-commerce growth continues to spur industrial real estate demand throughout the Golden State and across the country, in general.

Jud Clements, executive managing director with Cushman & Wakefield’s capital markets group, agrees, noting in a recent article that “the most significant trend driving industrial demand continues to be the U.S. industrial markets got off to a positive start in 2018, according to JLL’s latest Industrial Outlook report. There are THREE KEY TRENDS TO WATCH, says the global commercial real estate services firm:

After a stellar fourth quarter, with nearly 81.7 million square feet of total net absorption — the best fourth quarter historically—in Q1 net absorption came back to healthy and stable levels, closing the quarter with 48.9 million square feet.

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This is in response to an increased leasing demand of smaller to midsized spaces and the lack of available buildable land for mega-box warehouses (over 1 million square feet).

proliferation of e-commerce retail.

“Amazon, which generated a whopping $113 billion in revenue last year, is by far the market leader.

Walmart ($23.5 billion in revenue) continues to pour capital into its e-commerce presence, as do online retailers like Wayfair ($5 billion in revenue), which have no brick-andmortar locations,” he says.

ROBUST PORT ACTIVITY A CONTRIBUTOR Activity at key gateway ports in California, such as L.A.-Long Beach and Oakland, are also contributing to tightness in the industrial real estate market.

In her U.S. Ports Update, YearEnd 2017, Tina Arambulo, part of Cushman & Wakefield’s U.S. industrial In Q1 2018, the industrial vacancy dropped by 20 basis points to 4.8 percent. Overall vacancy levels have been cut in half since the beginning of 2010, when it peaked at 10.2 percent in the first quarter of 2010.

At the same time, JLL notes that the lowest vacancy across the country is in Los Angeles (1.4 percent), followed by Orange County (California) and Seattle, both tied at 2.4 percent.

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WAREHOUSING

chalked up the busiest year in the port’s 90-year history, she adds, handling 2.42 million TEU in 2017 and surpassing the previous record of 2.39 million TEU set in 2014.

Commercial real estate brokerage Lee & Associates states that rental rates for older industrial buildings are even closing in on rates offered for newer properties in the region because tenants are looking to secure space now amid expectations that the economy will continue expanding over the next few years.

Even though older industrial buildings tend to be smaller with lower ceiling heights and typically have less room to maneuver trucks, these properties are getting multiple offers, notes the brokerage firm. Last year alone, prices jumped from an average of about $130 per square foot to over $215 per square foot.

research practice group, states that: “Port of entry markets in the United States remain one of the key drivers in the industrial market. As imports have risen steadily over the last few years in many of the ports across the country, the appetite for nearby industrial space has been robust. A huge driver of demand, imports increased 7.6 percent in 2017 and represented 63 percent of the total loaded cargo volume in 2017 for the top 13 ports in the U.S. The National Retail Federation is predicting imports will be up 4.9 percent in the first half of 2018.”

Moreover, she notes, in 2017, West Coast Ports accounted for 52 percent of loaded imports at the top 13 U.S. ports.

“The ports of Los Angeles and Long Beach will remain fairly entrenched as the top ports in the country, and 2017 was a record-setting year with a combined total of 16.9 million TEU, up 8 percent from 2016. Much of that traffic flows to the Los Angeles Basin, one of the hottest industrial markets in the country. The Inland Empire posted the highest leasing activity in the U.S. with 42.6 million square feet, followed

by Greater Los Angeles with 34 million square feet,” Arambulo says.

For its part, the Port of Oakland

“THE MOST SIGNIFICANT TREND DRIVING INDUSTRIAL DEMAND CONTINUES TO BE E-COMMERCE.” — JUD CLEMENTS

NEW PROJECTS FOR L.A.-LONG BEACH Major real estate related expansion projects at the ports of L.A.-Long Beach are an indicator of the strong growth in trade at the twin ports and resulting demand for warehousing and distribution centers (DC) in the region.

In March, a subsidiary of Australiabased financial services firm Macquarie reached a deal with the Harbor Performance Enhancement Center (HPEC), a public-private partnership, to provide funds for the $130 million development of a 5.5-million-squarefoot container-staging hub on Terminal Island at the Port of Los Angeles.

According to HPEC, the publicprivate project will be built on 110 acres, which is currently fallow. When complete, the project will take 3,500 truckloads per day from nearby container

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terminals to the HPEC staging area, improving flow, reducing emissions and enhancing the efficiency of imported containers passing through the 14 marine terminals at the L.A.-Long Beach port complex, a complex that supports 42 percent of all U.S. imports.

Alex Cherin, executive director of California Trucking Association’s Intermodal Conference, notes that the hub will allow “the trucking community and its customers [to] have one start-stop location to pick up and drop off containers, distributing to regional hubs around-the-clock.

“This is one of the most important projects in the nation and will be a real game changer,” Cherin adds.

The project will follow the hub and spoke distribution model perfected by logistics companies such as Federal Express, UPS and Yellow Freight, explains HPEC. Meanwhile, the Port of Long Beach has green-lighted the construction of an $820 million, 171-acre rail yard project that will likely break ground in 2020.

“As cargo continues to grow, having this infrastructure in place will help us move more of that cargo by rail,” says Heather Tomley, the port’s director of environmental planning, in an interview with Long Beach’s Press-Telegram.

“Without this project, this cargo would have to go by truck.”

Tomley estimates that one rail trip from the port to the future rail yard could replace more than 700 truck trips.

Once underway, port officials estimate the rail yard project will take seven years to complete.

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EXECUTIVE FOCUS

{ SOFTWARE & TECH}

By Karin Bursa

ANALYTICS:

Changing the Speed of Supply Chain Analytics are the key to transforming data into actionable insights that accelerate your business forward.

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very interaction we have today consumes and/or creates data. When you search online you highlight which products and services interest you. Weather patterns provide indicators that can impact transportation, crop harvests and buying intentions. Social media interactions help drive sentiment and create or crush demand. There is a wealth of structured and unstructured data available to tap into.

Enterprise systems also produce a gold mine of valuable data. Many of these solutions can help visualize this data based on normal, cadenced-based schedules (think of spreadsheets or offthe-shelf business intelligence tools).

However, today’s global businesses are moving faster. Organizations need to support better decision-making with improved insights and at a moment’s notice, going well beyond simple visualizations. The key is transforming this data into actionable insights—and analytics is the instrument to make this a reality.

THE FIVE STAGES OF ANALYTICS There are five commonly used forms of analytics. While difficulty (attainment) increases as you incorporate each type into your process, so too do the benefits.

1) DESCRIPTIVE ANALYTICS focus on what happened. For many organizations, descriptive analytics are likely the first type that come to 48

mind and include dashboards, alerts and report visualizations.

2) DIAGNOSTIC ANALYTICS help you understand why it happened.

Think of this as root-cause analysis and planner-initiated what-if analysis.

3) PREDICTIVE ANALYTICS become more interesting as you start to focus on what could happen. Predictive analytics are able to evaluate multiple scenarios for a business and leverage machine-learning capabilities to determine the best course of action.

4) PRESCRIPTIVE ANALYTICS help answer the question, “what should I do?” They can consider a wide variety of attributes and business conditions to quickly help you determine the right steps for your business.

5) COGNITIVE ANALYTICS harness the power of machine learning and artificial intelligence (AI) to help you gain insight into new patterns, new data sources, risks and opportunities you’re not yet thinking about.

The goal for any organization should be to expand analytics capabilities across this spectrum of opportunity.

Leveraging a portfolio of techniques can help you gain new insights to support more complex decisionmaking, gain confidence in the decision quality and accelerate the pace your business is able to move forward.

DON’T STOP AT VISUALIZATIONS While a picture can paint a thousand words, analytics go way beyond visualizations. Pretty graphs and charts

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SOFTWARE & TECH

are part of it, but the real value comes from leveraging algorithmic planning, machine learning and AI to drive more automation, mitigate risk and harness new opportunities. Advanced analytics are about gaining new insights to run the businesses more effectively.

This includes serving customers better, boosting revenues and improving margins. To do so you must be able to quickly analyze a lot of data and serve it in a way that is meaningful to its intended audience.

Supply chain executives must trust in the data, the business capability model (digital twin) and the scenarios generated, along with their ability to execute and measure the success of the plan. Your supply chain system should

firms developing multiple maturity spectrums and publishing numerous reports. Many of these reports, however, do not incorporate time.

Analytics should collapse the timeline by accelerating your decision-making process. This acceleration requires advanced capabilities like machine learning to churn through huge data resources very quickly and efficiently in order to evaluate multiple scenarios.

As you collapse time, and the systems become smarter and results start to show the value in predictive and prescriptive analytics, business confidence will rise.

For example, let’s look at a global consumer goods (CG) company and how it was able to utilize several types

simple: “Does it make sense for the business to switch suppliers? Does the lower per unit cost translate into lower total costs for our business and deliver equal or greater service levels and quality?”

In the past, a question like this would have taken the CG company two to three weeks to model and evaluate. And after long hours of spreadsheet-based analysis, the choice would ultimately still be a coin flip (or wrapped with several caveats).

However, through advanced analytics, the company quickly leveraged its data to evaluate hundreds of scenarios.

In a matter of just a few hours, the team developed a plan that gave the business decision-makers the insight needed to make a selection. And the comprehensive quality of the analysis gave the business team a high-degree of confidence in its recommendation.

Interestingly, based on anlaysis, the decision was made to stay with its current supplier in Mexico.

TAKE ACTION

incorporate advanced analytics that will quickly perform the heavy lifting, visualization and analysis needed to ensure your plans are aligned with stated business goals.

of analytics to evaluate an opportunity.

One of the company’s trusted suppliers proposed expanding its current relationship to extend to additional component product lines. The proposal would change the manufacturing location from its current position in Mexico to China, while also reducing the cost per unit. The question posed to the supply chain organization was

BUILD YOUR OWN TIME MACHINE Analytics are a hot topic in supply chain, with industry research

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Advanced analytics provide a wealth of information that can help steer a company in the right direction. Today’s supply chain analytics help teams arrive at the right answer faster. The speed at which data can be harnessed and analyzed provides an advantage of opportunities to mitigate risks and stay ahead of the changing expectations of customers. The supply chain just got smarter. Are you ready?

ABOUT THE AUTHOR KARIN BURSA is the executive vice president of Logility. With more than 25 years of experience in the development, support and marketing of enterprise software solutions, Bursa is able to provide provoking perspectives, including market-shaping events, end-user perspectives and technical reviews.

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EXECUTIVE FOCUS

{ PROFESSIONAL DEVELOPMENT}

By Bill Michels

DOES E-LEARNING REALLY WORK? Companies are looking toward e-learning as a necessary training tool, but does it actually work?

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ow effective is e-learning in the development of your team? Many organizations praise e-learning as the ultimate solution to development because it’s sustainable and extremely cost effective. A lot of money gets invested in developing e-learning for clients in industries like entertainment, aerospace, energy, home appliance and pharmaceutical, with all having experienced similar results.

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When built and used correctly, e-learning can be a powerful tool for companies. However, companies tend to choose packages that don’t suit them, resulting in less-thansatisfactory results and limited impact on the organization. Often times, professionals look to utilize e-learning as a way of cutting training expenses for procurement teams. While unfortunate, it isn’t uncommon. Some skill sets need to be delivered in a classroom setting,

and courses like negotiation and cost analysis require that the student try different approaches in a laboratory.

That is not to say that gamification and artificial intelligence won’t be a long-term solution for interactive negotiation training, just not today.

Many companies also buy e-learning licenses for students, but when the annual licenses begin to expire, companies often seek licensure extensions so that employees who were busy during the year can cram

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PROFESSIONAL DEVELOPMENT

prior to the class, they were denied CHOOSING THE RIGHT entry to the class. In the program, PLATFORM students were assigned a cost and While considering an e-learning value improvement project and given solution, know that it needs to be six months to complete the project. interactive, flexible, personalized and Upon completion, employees received customized. When selecting e-learning company credit for the development for your company, it is critical that the course to meet their development supplier is agile and flexible in enabling objectives. customization of the learning to meet A BLENDED The company your learning objectives.

While considering an embraced the new APPROACH A reporting process that follows A good example of tools and processes students’ progression through the e-learning solution, an e-learning approach and embedded the e-learning program also needs to be know that it needs to learning, resulting that is proven to work included in the package. It’s essential is a blended learning in a return on that the modules are being taken, be interactive, flexible, and development investment of $40 progress is being made and the progress personalized and program for highfor every $1 spent is following the right sequence. potential employees. in the training Most importantly, the entire customized.

After creating a highprogram. organization must embrace the new potential team, one processes and concepts. Nothing is chief procurement officer commissioned NOT ALL E-LEARNING IS EQUAL more demotivating than learning new a custom e-learning program for all Not all e-learning packages are skills and returning to an environment others across the company, with the goal the same, though. Some e-learning that inhibits the use of new knowledge. of having the high-potential team serve packages consist There is no as mentors to those engaged. At the end of an eight-hour substitute for a A reporting process of the program, it was clear that though PowerPoint course blended learning employees became aware of the new with no narration. that follows students’ program to tools, many needed a refresher course Even the best student develop your progression through afterward. A mini-clinic program was cannot take a large team. If you are then adopted to reinforce the e-learning dose of annotated e-learning the e-learning program using process.

PowerPoint slides. correctly, it can be Another example of e-learning These poorly needs to be included in a powerful tool to done right is a global conglomerate constructed modules move your team the package. manufacturing organization that created increase the risk of strategically. If it is a process that could classify as “world students leaving and just a way to check class.” Its procurement and learning and never returning to complete them. off the training box and save money on development teams worked together to Other providers design the packages travel, you are wasting everyone’s time assess competency gaps that needed to to be generic and fail to relate to and the company’s money. be closed. Upon review, the team then students. For example, one technology created a custom e-learning package company purchased an e-learning ABOUT THE AUTHOR aimed at tactical and fundamental tools program that failed to work with BILL MICHELS is the vice president that were necessary for students to start the company’s firewalls, creating an of operations at America for the the class. environment where limited students Chartered Institute of Procurement Following the e-learning module, were able to access the program, and and Supply Chain (CIPS). He previously served as CEO and founder of Aripart participants were invited to attend a others were left to fend for themselves.

Consulting, president of ISM Services, and CEO of three-day strategic thinking classroom The e-learning experience can be ADR North America. In addition, Michels has held training program. If participants failed lonely, and students can leave feeling senior procurement and supply chain positions in the to complete the e-learning program isolated. manufacturing, paper and food industries. the packages to meet personal and corporate training objectives. This leads to poor retention. It would be more worthwhile for companies to save their money until they develop a review process that assures employees are meeting program goals and a sequence and schedule of modules.

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WORK HARD,

By Amy Wunderlin

TH E A R T O F

dynamics of the room, and speaking only when she was confident that it would add something. Afterward her boss called and told her they wished she would have spoken up more.

“I was mindful because I knew there were some challenges and I was the new kid on the block and hadn’t earned the right to speak up,” Kwan explains, adding about a month later, thanks to he trajectory of Tifenn teacher training class, Kwan’s that early mindfulness, her department Dano Kwan’s career and whole world shifted, with a new started seeing positive changes. She her mastery of yoga is no job opportunity at SAP Ariba. “I says she then finally was able to explain coincidence, she insists. literally got my new job just after I to her boss why she had been so Recently promoted to chief marketing graduated as a teacher, and there’s no reserved initially. officer at SAP Ariba, Kwan’s career coincidences in life,” she adds.

“I explained that I can be quiet and with the company started shortly after Since joining SAP Ariba, Kwan has observe, and that’s the way I am; I’m she embraced the ancient art. also carried the lessons she’s learned quite mindful. And right now it’s paying Kwan’s wife, who is a yoga instructor, from yoga into the workplace. The off, and I’m asking you to trust me. She first introduced her to the never again questioned practice as an outlet for her “When people don’t know how to collaborate, my ability to get things Type A personality. done. And that’s because of it’s really hard. Acquiring soft skills and having an mindfulness,” Kwan says.

“I was so stressed, not loving myself so much.

“If you want to get ability to listen and emphasize with people and I looked good, but it things done, you don’t respect their point of view is really important.” have to be anything else doesn’t mean that I looked ­— TIFENN DANO KWAN healthy,” she explains. but yourself. You have to “I hated yoga at first because I was biggest lessons learned she says are fundamentally believe in yourself even an extreme sports girl. I needed the resiliency, kindness, self-love and, when the boss calls you out,” she adds. adrenaline to really keep going.” (Kwan maybe most importantly, mindfulness.

Yoga has also impacted Kwan’s still surfs, rides motorbikes and skis.)

Mindfulness is something Kwan has leadership style.

But as it turns out, what Kwan really carried with her since As she has excelled in her career needed was self-love. day one. In her first and taken on more responsibilities, “When you’re doing yoga, it limits big meeting after becoming accountable for more people, the modifications of the mind, so it’s joining SAP Ariba, Kwan says it has become increasingly like meditation. If you practice yoga she kept very quiet, important to listen. She credits yoga for on a regular basis, it actually calms observing the this breakthrough. the mind, so you stop thinking about body language everything and you start connecting and the with your true self,” she explains.

That inner connection has guided her well, and as Kwan progressed in the practice, she says she began to see the world differently. “I was much more grounded, mindful. And it had a complete impact on my life and my career.”

Shortly after completing a yoga

Mindfulness SAP Ariba’s Tifenn Dano Kwan uses lessons learned in yoga on the job.

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2018 Educational Webinar Series DETAILS & REGISTRATION: S D C E X E C . C O M / W E B I N A R S T I M E : 1: 00 P M E T / N O O N C T / 11:00 A M MT / 10:00 A M P T

AT T E N D F O R F R E E T H A N K S T O O U R S P O N S O R S

ON-DEMAND WEBINARS

SDCEXEC.COM/ WEBINARS Available now!

September 26

August 15

Risk II _________________ Expert panelists discuss how to evaluate visibility across borders and multiple suppliers to predict and respond to risk, the ability to collect/ exchange information throughout the supply chain and how to choose/ implement the right tools/metrics for a comprehensive risk mitigation program.

The Internet of Things II _________________ The IoT is part of the overall digital transformation underway across global supply chains. While the promises are plentiful, so too are the perils.

Join industry experts for a candid conversation on how to get the most out of the IoT while avoiding the pitfalls.

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October 24

Predictive Analytics II _________________ Predictive analytics, combined with Prescriptive analytics, offer powerful supply chain management information for manufacturers, retailers and logistics providers. An expert panel offers insight into how organizations can leverage these tools, including how to evaluate various and competing solutions to make the right investment.

The Internet of Things I Warehouse Automation Sponsored by:

Risk Mitigation I Sponsored by:

November 14

Blockchain for Supply Chain _________________

Blockchain is a highly promising technology for supply chain.

It can reduce risk and improve end-to-end visibility, streamline documentation and cargo flow and provide unprecedented accuracy and security. Join our expert panel in a roundtable discussion on blockchain technology that is sure to generate actionable take-aways.

Sponsored by:

December 11

Executive Outlook for Supply Chain 2019 _________________ SDCE’s annual Executive Outlook educational webinar brings together industry executives for a roundtable discussion of the top-level trends and developments taking shape in the supply chain sector and what that means for the year ahead.

Procurement Trends I Sponsored by:

Predictive Analytics Sponsored by:

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To become an expert panel sponsor, contact Jolene Gulley | 480-413-0354 | jgulley@ACBusinessMedia.com

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Dates are subject to change.

6/13/18 2:19 PM

M OST S E E

A shipping container.

WE SEE

A team of behind-thescenes experts optimizing a flexible, customized supply chain so products can be imported and exported seamlessly and delivered to customers faster.

LET OUR EXPERTS BUILD A STREAMLINED SUPPLY CHAIN FOR YOU. Visit SCSPA.com/SupplyChainAuthority for information.

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