Today’s supply chains are more complex than ever before. This complexity arises from several factors, some that have existed throughout time and some that are unique to this era. From extreme weather to a global health crisis – today’s market is perpetually subject to volatility. This is only compounded by shifting consumer expectations and demands, with one-day delivery and personalized offers becoming the norm for many suppliers.

Technological advances make it easier for suppliers to satisfy this shifting demand but can also be challenging for those who struggle to keep up with the times. The key to success in this digital era? An understanding of the systems, methodologies, and concepts that are connected to on-demand order fulfillment, near-instant delivery, and increased demand.

A CPIM education provides a framework and tools for synchronizing, optimizing, and continuously improving an organization’s end-to-end supply chain. It is a key prerequisite to embarking on an enterprise resource planning (ERP) system implementation.

With a CPIM education, supply chain professionals master Lean, Six Sigma, Theory of Constraints, and project management concepts. They also study many components of the Manufacturing Planning and Control hierarchy of demand and supply planning and execution, all combined to provide enhanced visibility and control. CPIM stresses the value of a consistent use of terms, as defined by APICS, the global standard for the entire Supply Chain Body of Knowledge. The certification is a key to individual and enterprise success through excellence in supply chain management.

A few weeks ago, on my way to the kitchen, the TV was on national news and this popped, “…only a third of American workers are engaged”. Here we go again. This put me on reflection mode. I am aware of the reasons many workers are not engaged, e.g., they are not valued, inadequate human resources, poor data and systems, dysfunctional organizations, etc. One of these I know well—lack of proper training. As a supply chain professional for over two decades, I have seen my fair share and then some.

Too often companies place people into supply chain roles without training and thrown into a costly haphazard learn-as-you-go system. Most likely the individual did well in a certain area in the past so it is then assumed that he or she will do well again. And so, it goes…if all you have is a hammer, treat everything as if it were a nail. When I pivoted my career from chemical engineering to supply chain, I knew it was comparatively simpler and somewhat more intuitive. I also knew I had to learn the right way to apply it. Just because a business discipline appears to be simpler or about the same as the one you experienced, does not mean you can walk in and be successfully engaged and productive. This is true whether you are a manager or an individual contributor. Supply chain is dynamic and quite often moves very fast. Therefore, you need to know what you are doing, with confidence. Mistakes can be expensive and irrecoverable—lost or dejected suppliers, excessive and or obsolete inventory, missed opportunities, expensive contracts put in place, etc. Almost everyone knows that supply chain operations directly affect the enterprise finances—cost of goods sold, working capital, and cash flow to mention a few metrics. Without proper training, supply chain can be intimidating which in turn contributes to the problem.

Proper training and knowledge bring the confidence that promotes successful engagement. A bonus—efficient teams can then be formed hence enhancing the overall organizational engagement level. There are no short cuts here. Enterprises must properly train their employees to unlock their full potential and help them attain the confidence that follows. 

I’ll leave you with a popular bit of humor circulating the Internet. A CEO tells the CFO to budget for employee training. CFO: What happens if we spend the money and they leave? CEO: What happens if we don’t and they stay?

Ramon A. Diaz, MBA, PMP, CPIM, CSCP

Reference: Click here

As I finish instructing my current inventory management class, I was reflecting on the various remarks given by the students throughout the course— one stood out. An experienced plant manager was retaking CPIM because his certification had lapsed years ago. During the first session when we do introductions, the individual made this emphatic comment— “Going through the CPIM certification classes will give you X-Ray vision!” I could not help but to chuckle. I always tell students that supply chain touches everything and everything touches supply chain followed by, if there is a factory meeting going on, you probably need to be there. Yet, his remark summarized it much better.

Going through the course, I realized that APICS certifications classes are like a mini MBA. The sessions cover many aspects of management such as: operations, sourcing strategy, planning, logistics, manufacturing, supply chain as it relates to the financial statements, lean, analytical techniques and even dealing with people. It enables individuals to see around the corners and anticipate problems as well as to exploit opportunities well in advanced. As we moved along the coursework, the students were able to identify problems and root causes they were experiencing in their workplace. A few became eager to turns things around immediately. I advised them to slow down, take on a small project, collect solid data and present the data in an organized and convincing manner by using well-devised graphs and statistical analysis tools covered in our coursework. More importantly, I reminded them that we all work with people and we need to gain them over for change to take effect; use a change management and communication approach. Besides, if you do not have good data, all you have is an opinion. With our tight employment situation, enabling the organization with the right knowledge and training is critical to perform or even outperform the competition whichever the situation might be. This is even more so with the current pandemic situation.

From the instructor’s perspective, I am always thrilled to see the empowerment that comes from knowledge. This fuels my energies and pushes me to go beyond by providing additional material to enhance the sessions and ensure students have a good start. We were a bit behind on the syllabus, but it was fine. We all had fun learning. 

Ramon A. Diaz, MBA, PMP, CPIM, CSCP

Published on March 12, 2020

Reference: Click here

Original Post: SCMR.com

By: Brian Braodhurst

Traditionally, many of the efforts with initiating a shipment have been concentrated to a finite number of locations (i.e. shipments originated at the shippers’ facilities). In the parcel industry, this often means a dense delivery location, as opposed to a dense pickup location for outbound shipments.

Reverse Logistics requires that shipment creation to be available at all potential customer locations

• This requires everything from technology enabled shipment label creation, to customer instructions for shipping a package
• In addition, shippers need to decide if they want to collect payment for the return shipment, and decide how to collect that payment if they elect to charge the customer for return shipping

As the e-commerce industry expands into more markets, returns are increasing at a rapid pace and therefore making reverse logistics a primary focus area for parcel shippers.

To expand on that, outbound shipments are typically tied to revenue and shipping is an acceptable cost of doing business.  However return shipments are often less time sensitive and at most indirectly tied to revenue, thereby making them a very cost-sensitive part of the supply chain.

Done correctly, reverse logistics can enhance the customer experience and drive brand loyalty.

Additional Market Information

• When managing small parcel costs, you, as the retailer, need to not only worry about delivery to the end customer but also any potential returns. According to CBRE, returns of items bought online could be as much as $32 billion in 2017.
• UPS deemed January 3, as its National Returns Day, with expectations of 1.4 million packages returned, an 8% annual gain and a new record for the fifth straight year.
• Items returned in-store cost as little as $3 for a retailer to process and are often available for resale within a day, but items shipped back to a distribution center or to a 3PL can cost twice as much to process and take at least four days before they’re available for resale, according to AlixPartners. That’s if the returns aren’t damaged or opened, in which case they might be written off as a loss.
• Data from U.S. Census Bureau and National Retail Federation show that the return rate is about 8% for the entire retail sector, although the percentage rises to between 13% and 30% for e-commerce sales. The difference: shoppers can inspect, sample or try an item at the store before buying it.
• To encourage in-store returns, FedEx teams with Walgreens to bring discarded items back to more than 7,500 convenience stores nationwide. This past September, Amazon Inc. joined with Kohl’s to accept returns at 82 stores in Los Angeles and Chicago. In November, Wal-Mart Stores Inc. began “Mobile Express Returns” at about 4,700 stores nationwide. Shoppers initiate the return on the Wal-Mart app, then scan a QR code at a express station in the store and leave the item.
• “Speed and efficiency in processing e-commerce returns, with an eye toward preserving as much value of the merchandise as possible, often separates the top-performing retailers from the not-so-successful ones in the weeks after Christmas,” CBRE’s Egan said.
• Returns cost retailers $260 billion in 2015, according to the NRF. Retailers can ease the expense if they can convince customers to return web-purchased items to stores in person. On average, returns to stores cost companies half as much as returns to distribution centers, and allow retailers to get the items back on shelves faster, according to research from AlixPartners, a consulting firm.

By Christon Valdivieso CSCP, SSBBP on SCMR.com

 

It is no secret that over the past several years the American economy continues to strengthen. As a result, the unemployment rate has steadily declined and more Americans are finding work or growing into better positions. By all accounts this is good for both people and business. However, as the economy grows, and the American workforce continues to rise through the hierarchy, they perpetuate an insidious condition that is sabotaging the modern business landscape.

 

There is a foundational belief that the customer is always right, and it constrains modern leaders because it prevents them from saying “No”. Saying “No” to a customer is difficult.

 

Fear of losing the customer or an opportunity usually drives leaders to acquiesce. Luckily, the internal customer—our employees and business partners—is the main group that needs to be told “No”. How often, for example, does your IT team find legacy hardware at employees’ desk because someone wanted to keep their old set-up? Similarly, how many organizations find themselves with various ERP or business intelligence tools because a small sub-set of the team has an attachment to a particular system? The reluctance to say “No” kills efficiency and creates waste, yet managers go it daily.  

 

Read Full Article 

Zebra Technologies Corporation, today revealed the results of its 2017 Global Shopper Study, the 10th annual survey analyzing shopper satisfaction and retail technology trends.

The body of research revealed that while 44 percent of surveyed shoppers are still not satisfied with staff availability and customer service, overall shopper satisfaction has significantly improved since the study’s inception a decade ago.

While four in 10 shoppers surveyed in Zebra’s tenth annual retail survey cited being better connected to consumer information than store associates, more than half believe store associates armed with the latest technology improve the overall shopping experience.

Read Full Article Here

From: SupplyChain247

 

DHL Supply Chain successfully completed its global augmented reality pilots and is expanding its "Vision Picking" solution in more warehouses around the globe, establishing a new standard in order picking for the industry.

 

The smart glasses provide visual displays of order picking instructions along with information on where items are located and where they need to be placed on a cart, freeing pickers' hands of paper instructions and allowing them to work more efficiently and comfortably.

 

The international trials have shown an average improvement of productivity by 15 percent and higher accuracy rates. The user-friendly and intuitive solution has also halved onboarding and training times.

Markus Voss, Chief Information Officer & Chief Operating Officer, DHL Supply Chain says;

 

"Digitalization is not just a vision or program for us at DHL Supply Chain, it's a reality for us and our customers, and is adding value to our operations on the ground. Customers have been very happy about the productivity gains and are equally excited about using innovative technology at their warehouses."

 

 

After having completed a pilot program across the U.S., Mainland Europe, and the UK throughout different industries such as technology, retail, and consumer, DHL has now established the Vision Picking solution for the long run.

 

The technology has matured to become a standard, replicable solution for customers, allowing faster and easier implementation in their operations, helping them to benefit from productivity gains with increased speed of operations and better picking accuracy.

 

Employees have been enthusiastic about being able to use state-of-the-art technology and are pleased with how light the smart glasses are, and how much more comfortable the process is now with hands-free picking.

"We are very satisfied and happy that the pilot phase went so well and that we can now say augmented reality technology is one of our standard offerings at DHL Supply Chain," Voss adds.

 

"As one of the first logistics companies using the technology, we have truly established a new way of order picking in the industry."

DHL has been working alongside three partners in the pilot phase. Ubimax provided the augmented reality software xPick, whereas the recently announced Glass Enterprise Edition and Vuzix M100 and M300 glasses were used as hardware.

 

Further proofs of concept running in Asia and Australia with other partners show similar promising benefits.

 

Following the success of its Vision Picking program, DHL is looking into additional applications for augmented and virtual reality such as training, maintenance, dimension calculations and more. 

By: Muddassir Ahmed 

 

As most of us know, finance is an important function to any organisation as the company has to know how viable its balance sheet and profit and loss (P&L) statement is. The head of this function generally titled as Finance Manager is amongst the key supply chain stakeholders in my opinion.

 

Generally finance managers are responsible for business activities like budgeting and sales forecasting, accounting, reporting, bookkeeping, audits, payables and receivables, pay employees wages and salaries, prepare and plan internal financial information and prepare for never ending audits!

 

However, nowadays they are require doing more to involve in innovation initiatives, helping create vision and strategy and get involved in employee engagement initiatives. In my opinion it is important that supply chain folk have a good understanding of finance. And how this function can contribute to the success of the jobs we are in. This will ensure that the business can effectively manage the money we are saving as supply chain and procurement individuals, else we are spending in various commodities.

 

So if you need slightly better chance of succeeding at your business goals and mission here are 5 good reasons why your finance manager is amongst your key supply chain stakeholders:

 

1.   Finance can help you to show impact on bottom line

As supply chain professionals we are always involve in cost reduction, inventory management, sales forecasting, supply management and many other activities which impact companies’ bottom line. If you are good friends with finance they can help you present the numbers in user friendly  way, that highlight the saving you are making and making a solid impact to bottom line. The can also help you show solid audit trail of these savings.

 

If you are driving any E&O and Inventory reduction initiatives they can help you create provisions for dead inventory, identify cost elements which impact most or even stock accuracy! These are just one of the very few examples why finance colleagues are one of your key supply chain stakeholders and how they can help you showing impact to bottom line.

 

2.   They can help you in your budgeting and profit planning

 

All supply chain and procurement managers have to submit or give their input annual budgeting and profit planning. In the early days of my Supply Chain Manager role, I found this task daunting, to the extent that I often questioned my manager with why exactly was I having to do this? You can guess the answer!

Your finance manager can help you with the process and provide your right guidance on how you can work through the input data, how you can sanity check your output and give you comparatives to validate your data.

 

For example entries like direct labor in warehouse, employee salaries, office suppliers, training and travelling budgets, Inventory budget, capital expenditure are typical items you have to deal with when you’ve been ask to put your annual budget! If you know them all great, if you don’t then you might want to tell your finance colleagues they are one of very important supply chain stakeholders!

 

3.   They can help you fit in with business culture

 

When you are new in a company or someone new in the job it is important to understand the culture of the business. Considering supply chain and procurement are mostly viewed as cost center, adding little value apart from year-on-year saving. As these diminish, supply chain folks are forced to critically understand the wider business. Your finance leader can help you understand wider business and culture to learn what else is important.

 

4.   You can make them look good!

 

Yes, we can also make finance guys look good. Not just our friends, in sales, customer service or marketing. For example, one of the task finance managers has to provide most accurse sales forecast for next year. So if you are running a well-oiled Sales & Operations Planning process you can provide sales forecast date for next 12-18 months which can be the most reliable input to profit planning.

 

Furthermore, in most businesses finance folks are responsible to providing forecast of inventory, cash flow, profit and loss all these financial aspects where we as supply chain professionals as massive impact (link to point 1 above). If we can provide reliable data which help them forecast these financial schedule with increased reliability and in turn we can make them looks good. What is in it for us as supply chain team? As they say in English…

 

            “You scratch my back and I’ll scratch yours”   

      

5.   Finance can help you priorities strategically.

 

In my experience most supply chain jobs are very operational and tactical in nature. Someone is wrong somewhere every day.  The only day when something is not wrong, it is either or Christmas Eve, Christmas Day or New Year’s Day! This makes our job very ‘reactive’ and ‘tactical’.

 

It is not all about avoid price increase, increased performance, service levels, and implications of risk. We ought to be responsible for giving input to strategic direction to business. So in all the day to day chaos around us, a day with finance guys off site just to discuss strategic topic can do wonder!

 

Conclusion:

 

There are many other reasons why finance managers and their teams are amongst your supply chain stakeholders which could be very specific to your business. I have only tried to mention a view based on my experience.

 

We as supply chain and procurement professionals should be seen as promoting integration with other functions and ingrain themselves into stakeholder communities, acting as advisers and internal consultants, and generate outside the box ideas. 

By: Muddassir Ahmed

 

In a JIT supply chain, reliable suppliers will reduce supply uncertainty and make the supply chain more effective, therefore supplier selection is crucial. However, Purchasing in JIT environment is different and therefore it requires a slightly different mindset for selecting suppliers who can survive in JIT Supply Chain long term. Researchers¹ suggested that the selection and evaluation of supplier’s ability to delivery in JIT Supply Chain should be based upon the following factors:

 

JIT Supply Chain- Quantitative & Qualitative Supplier Selection Factors

1.      Delivery of a Quality Product

2.     Delivery On-Time.

3.     Frequent Deliveries.

4.     Delivery in Small Quantities.

5.     Delivery of Exact Quantities.

6.     Supplier’s Management Policy and Philosophy

7.     A Willingness and Openness to Share Data and Information

8.     Attitude towards Partnership

9.     Willingness to Undertake Continuous Improvement

10.   Desire to Develop New Products

11.   Ease of Communication at All Levels

 

Hall (1983) suggested capacity and willingness to improve as additional criteria to the above list.

Carr and Truesdale (1992) stated that Nissan’s supplier selection team visits supplier factories frequently. They evaluate delivery reliability similar to those above. They evaluate products from design and development through to the manufacturing processes.

 

The Nissan team also looked at planning, operation, tidiness, appearance of workshop, working situation and professionalism. For professionalism they looked at engineering management attitude, the number of engineers employed, how they are structured, their technical capability and their influence within the organisation. Supplier’s location and market size is of less importance to Nissan.

 

Aleo (1992) described the supplier selection procedures of Kodak. A selection team is formed by Kodak consisting of multi-discipline specialists. They developed a suitable decision matrix for the particular product under the evaluation. The suppliers are ranked numerically according to their ability to meet Kodak’s programmed needs.

The selection process started with a review of current documentation pertaining to their suppliers. A comparison of supplier capabilities is then recorded in the decision matrix. The team review all historical data, quality, delivery and inspection procedures. Kodak maintained an open communication with its suppliers in the area of quality improvement and advised suppliers who failed to achieve the expected quality standards. A follow-up inspection is undertaken to ensure that the agreed changes have been carried out.

 

Southey (1993) described the current practices of supplier appraisal as more encompassing than before. The appraisal can be divided into two areas namely quantitative and qualitative. Quantitative includes location, financial position, facilities and capacities, technical capability and standards of quality, whereas Qualitative consists of items 6-11 in list above.

 

Southey (1993) also suggested other general evaluation criteria when there are numerous suppliers, for example, comparison with the level and quality of similar suppliers, supplier’s relationship with competitors, supplier’s track record and potential for future improvements to sustain JIT Supply Chain.

 

In JIT Supply Chain, ‘Lean supply’ requires additional supplier selection criteria. Particularly in the sense of sourcing parts close to the points of manufacture so as to keep logistic cost to a minimum. The supplier must be ready to provide a service ‘locally’ wherever the manufacturer requires it in the world. As lean production develops globally, manufacturers tend to find local suppliers prepared to compete to improve leanness.

 

Summary:

There has been huge amount of research done to identify suitable supplier selection criteria. The above mentioned 11 quantitative and qualitative factors are just one aspect which has been identified with keeping JIT Supply Chain only in mind.

Original Post on APICS.org

 

Apparel supply chains used to be known for producing high-fashion designs with slow response times. Designers and retailers forecast demand a year in advance and tailored their releases by season. As consumer trends have swung toward demanding low prices and fast response times, the apparel industry has shifted dramatically. Today, many businesses are trying to satisfy consumers who expect the products they want to be available right now. And for the most part, companies are succeeding in this endeavor.

This newest phase of the apparel supply chain life cycle is called fast fashion, which recognizes attempts to provide the latest styles quickly and at low prices. Because prices are so low, consumers are less concerned about how long the product will last. Instead, they are willing to make impulse buys and continuously purchase new items to keep up with the latest trends. Companies therefore are shortening the length of the fashion cycle and integrating sustainable innovation into the core product design and manufacturing process (Amed et al. 2016). The companies most cited as being in the forefront of fast fashion are Inditex, parent of Zara; H&M; Forever 21; and Primark. A study by Bloomberg Businessweek reports that Zara grew sales by 240 percent and H&M sales jumped 180 percent between 2004 and 2015 (Baker 2016). By comparison, Gap, which has a more traditional fashion supply chain, experienced level sales during the same period.

It’s interesting to think about early apparel supply chains and how far this industry has come. Hundreds of years ago, materials were sourced from local shepherds, designs were simple, and clothing was created for function instead of fashion and often handed down from generation to generation. Improving economic conditions helped that industry grow from a local to a regional one, encompassing consumers in neighboring communities or within the same country. Materials started being sourced from larger ranchers, and designers focused on high-fashion dresses that were modeled in exclusive fashion shows and sold as unique pieces to the rich and famous. To make the designs available to the public, regional manufacturers created imitation items. This also lured consumers into retail establishments, creating a more formalized business process. Still, most participants in this supply chain were within the same region, so response time was not a critical issue.

Designers soon found that there was a huge market in clothing and began to develop their own brands. Styles were scheduled to fit the seasons, so designers and retailers had to plan a year in advance. The apparel usually was sold through department stores, although a few designers established their own retail outlets. However, as more brands flooded the market, apparel companies learned that they needed to keep their prices low in order to stay competitive. As a result, supply chains expanded as companies outsourced to countries with lower labor costs, especially China.

In addition to competing on price, retailers found that response time became a competitive advantage. Those trying to operate on the four-season schedule had difficulty forecasting types and amounts of individual styles, sizes, colors and brands. Consequently, these businesses usually ended up with excess inventory that had to be sold at even lower prices or eventually scrapped. This gave rise to the fast-fashion model, which focuses on more-frequent releases of low-cost apparel throughout the year that deliver on consumer product interests. However, this shift stretched supply chains even further as apparel companies worked to keep up with the new requirements of quickly changing styles, continued lower costs and faster deliveries while juggling emerging environmental and working-conditions concerns. Zara, for instance, hires local and regional suppliers to fulfill time-sensitive orders and uses remote, low-cost suppliers for its evergreen products (Kowsmann 2016).

 

Fast fashion also has integrated the roles of design and manufacturing. Designers have to not only create the items but also consider how they can be manufactured and how these processes will affect the supply chain (Khan, Christopher and Creazza 2012). Again, Zara is the generally acknowledged leader in responding to design changes. Its designers work with the company’s production and logistics teams to review daily data feeds from retail stores. This feedback, along with comments from customers, store managers and country directors, help the design team decide what products to make (Baker 2016).

 

Supply chain implications

What does all of this mean for supply chain managers? First, there is increased pressure to establish and maintain supply chains that can deliver quality, low-cost goods quickly and efficiently. At the same time, they must be agile enough to change as market conditions change. Successful supply chains must be tightly integrated in order to be transparent to all participants, from the various tiers of suppliers to consumers. This level of integration demands a level of collaboration not found in many of today’s supply chains. It requires

• systems and processes linked together to enable complete and rapid flow of information
• policies and procedures that are clearly issued, understood and followed
• consistent and fair transactions
• technology that is appropriately matched to the functions being performed
• a clearly recognized leader — whether a retailer, a manufacturer, a third-party logistics professional or even a broker who coordinates all of the steps in the supply chain
• the ability to ensure the flow of goods while maintaining the smooth transitions among supply chain members. 

In addition, the use of low-cost labor and the short life cycles of products have created corporate social responsibility challenges for supply chain professionals. As buyers discover the working conditions in some supplier organizations, this increases awareness about employee pay and safety. Concerned consumers expect companies to source from suppliers that support workers’ rights while offering low-cost products.

Similarly, supply chain managers must consider the end of their products’ life cycles. The flood of clothes being sold is overwhelming the reverse supply chain. About 10.5 million tons of clothes end up in American landfills each year because resale shops can only handle about 20 percent of the clothes being discarded (Bain 2015). This creates environmental waste that eventually will have to be addressed.

Fast fashion still is an emerging model in the apparel industry, but it quickly is becoming a concern for department stores and other large retailers, which are rapidly losing apparel consumers to these fast-fashion leaders. To be most effective in the future, apparel companies must consider both the market demand and the supply chain. This will enable the industry to keep up with consumer style preferences, appropriate response times and price points, and social and environmental implications created by an evolving market.