Supply Chain by the Numbers for Week of June 7, 2012
US Factories Keep Getting Busier; Mineral Shortage is Coming - in a Long, Long Time; 3M Attacks Cycle Time; How do You Rate in Dock to Stock?
Number of consecutive months that the US factory “new orders” index from the Institute for Supply Management (ISM) has remained above the 50 mark that separates expansion from contraction – impressive That after the May number just released rose to a level of 60.1, showing great strength. The new orders index is a sub-component of the overall Purchasing Managers index, which stayed above 50 in May for the 34th straight month, though the rate of expansion slowed a bit last month, while new orders rose at a faster rate than the previous month.
The number of years for which the earth will have enough minerals (copper, zinc, potash, etc.) to well run its societies, according to Andrew McKenzie in an interview this week. And he ought to know: McKenzie is CEO for non-ferrous metals for mining giant BHP Billiton. The statement came in the context of many who fear the world will soon be depleted of such resources, with Google co-founder Larry page leading a group of investors seeking to find a way to mine asteroids to unlock a new source of key minerals. Caterpillar is said to be working with NASA to develop mining gear that would work in space. We’re thinking they are all a little early…by a few thousand years.
The median number of hours for “dock to stock” time across all the respondents in the recently published annual WERC DC Metrics report, prepared by Dr. Karl Manrodt of Georgia Southern University and Kate Vitasek of Supply Chain Visions. Best in class (top 20%) were able to put away goods from the inbound dock in under two hours, while the lowest quintile reported average dock-to-stock times of more than 18 hours. (The median was 6 hours, but the middle quintile was actually defined as 4-8 hours).
The goal in terms of manufacturing cycle times that industrial giant 3M is trying to take out of its supply chain under a several year-old program to eliminate supply chain “hairballs,” as a recently retired CEO use to call overly complex moves and touches involved in making many 3M products. The answer for many of these supply chain complexities is to create super manufacturing hubs in the US and across the world that have more capabilities to do many steps in the process in just one place. One interesting outcome is that it appears this will mean 3M is bucking the trend and will do more work internally and reduce outsourcing. 3M says it has 18 “high impact” initiatives in this area.