SEARCH searchBY TOPIC
right_division Green SCM Distribution
Bookmark us
sitemap
SCDigest Logo
First Thoughts
  By Dan Gilmore - Editor-in-Chief  
     
   
  May 24, 2013  
     
 

Trip Report: Gartner Supply Chain Executive Conference

 
 


I am freshly back from a couple of days at the 2013 Gartner Supply Chain Executive conference in Scottsdale, AZ, heading back before day 3 so that the wall of work that always awaits me back at the office after such excursions did not get impossibly high. I would also like to say thanks to the many people there who came up and introduced themselves to me - the most ever, I believe. I really enjoy that, with many in fact thanking us for the video and written summaries we do for these types of events.

It was a good conference, though certainly changed a bit since the last time I was there, which was prior to Gartner acquiring AMR Research in 2010. AMR was the originator of this event a number of years before that.

Gartner has a huge conference business overall, and has basically adopted its overall model to this supply chain event. That has led to growth in attendees - some 1100 this year - and frankly a bit more commercialism, including a trade show type area and breakout sessions paid for by sponsors, elements that weren't there under AMR. But all told this conference is evolving into a major event status from the somewhat more "boutique" feel under AMR.

Gilmore Says:

The bottom line, Phillips said, is that not only is there an imperative to sync the digital and physical worlds, but that the supply chain is extending further down, past the store level, in many ways.


Click Here to See
Reader Feedback

There were no real overall themes here, so I am going to jump right into keynote and breakout session highlights.

I was actually not expecting much from the Day 1 keynote by John Phillips, SVP of Customer Supply Chain and Logistics for PepsiCo. The titled indicated it was about social media and I assumed mobility and other topics that I have heard repeated times and which frankly often don't seem too connected to the supply chain.

I was wrong. Phillips did an excellent job of detailing a number of developments on the "digital" side of business and why connecting that digital world to the physical supply chain world is going to be increasingly important, pointing out many developments on the digital side I wasn't aware of.

Case in point: Pepsi now has a social media command center that monitors developments in this world closely, especially after new product introductions. This is a new age form of "demand sensing," and allows Pepsi to rapidly adjust forecasts and marketing plans based on trends seen in these social channels.

Virtual store technology is coming, Phillips showed, in which consumers can walk the aisles of local stores and put items they want in their shopping carts. This is a much different experience from the un-visual approach of on-line grocery shopping to date, and I think could transform the industry. There are the same type of opportunities for in-store promotions, end caps, etc. as in a real store. In Japan, there is such a system right in its subway system, where a shopper leaving the city can do this sort of virtual shopping and then have the groceries ready for pick up when she arrives home.

In the UK, a company has developed a secure home delivery system, basically a sliding drawer into which a delivery person would place dry goods, slide the drawer back in and then locking it. There was much more.

Phillips spoke of the challenges of maintaining data integrity across all this, something I have pondered myself many times, but I had not considered the packaging aspects. If I see an image or order from a virtual store that uses one packaging configuration, am I a little leery if the item I received looks different? This could be a huge challenge - packaging consistency and synchronization with the digital world.

The bottom line, Phillips said, is that not only is there an imperative to sync the digital and physical worlds, but that the supply chain is extending further down, past the store level, in many ways.

Does any of this apply to companies outside consumer goods to retail? I think so - more soon.

Intel manufacturing executive Robert Bruck gave a convincing presentation on the need for deep supplier collaboration, at least in Intel's case. The technology giant simply cannot meet its supply chain and product goals without suppliers moving a long down the same path at the same pace.

It has a supply chain engineering team that works with vendors across and down its tiers to make sure that happens, including companies it has no direct relationship with. But those companies may need to make improvements on their own to support say a goal to reduce production cycle time by 50%, which the company has achieved since 2009.

To get there, Intel also makes long term commitments to suppliers relative to relationships and volumes, and has over 130 joint ventures with suppliers (i.e., Intel has invested money) to drive innovation. Very different mindset than most companies.

L'Oreal's VP of corporate supply chain Barry Stewart and colleague Bin Zheng gave an interesting presentation on another form of supplier collaboration, but what intrigued me at the outset was how L'Oreal thinks about its supply chain. Its three-step model is: Plant -> Market -> Customer. Under Customer are processes such as demand planning, order-to cash-cycle, and trade services. Under Market are areas such as S&OP, and distribution requirements planning. Very interesting way to organize supply chain thinking.

After laboring under very manual processes for interaction with suppliers, L'Oreal a couple of years ago adopted a new collaborative platform (E2Open) that automated many of the existing steps, but more importantly allows L'Oreal and its 700+ vendors to share and see demand and supply response capability in real-time. It has cut days out of the cycle, and enabled L'Oreal's supply chain to respond much faster as data comes in relative to new product introduction. This is the type of integration and blurring of planning and execution we have been writing about for the past three years.

I was pleased to see Colgate-Palmolive and supply chain exec Mark Vollrath speak on Colgate's multi-year journey to standardizing manufacturing processes across the globe. That's because of all the major consumer packaged goods companies, I would say Colgate is the most reticent about what it is doing in its supply chain, which was sometimes taken as meaning that they weren't doing much.

The benefits of such standardization seem obvious today, but I liked Vollrath's observation now that when the manufacturing teams get together, personnel from different plants get together to solve a challenge, etc., they are now all speaking the same language, and referencing the same KPIs, greatly improving effectiveness.

Gartner analyst Simon Jacobson used the good analogy that it used to be each plant was sort of its own universe, whereas now the global supply chain is the center of the universe, with plants orbiting around that as satellites. If you haven't vigorous started this process yet, please do so with urgency.

Troy Roesslein of Sears Home Services - repair services and parts for appliances and such - gave a nice presentation that put some meat on the supply chain visibility bones. Until the past few years, Sears really had little visibility to inventory across its multi-tiered supply chain, which includes master DCs, regional DCs, repair centers, the vans of 7600 field service techs and more.

Sears has largely solved that now (still in progress) with a set of new tools (Softeon) that provide real-time, multi-level visibility right down to treating the vans as mobile warehouses. Total network inventory levels have dropped significantly as a result. Key to getting the field techs to buy in: having big part of total compensation be on the percent of calls completed in the initial visit. That made the techs realize importance of having the right parts on their trucks. The new system also has very interesting logic as to how parts that need moved or returned flow back through the network (reverse crossdocks).

Ok, I am out of room. Much more at the event, some of which is covered in our video review, others that we will write as case study articles in coming weeks.

Any reaction to Gilmore's sumart of the Gartner conference? Were you there? What are your thoughts? Let us know your thoughts at the Feedback button (email) or section (web form) below.

 
 
     

Recent Feedback

 

No Feedback on this article yet

 



Supply Chain Digest Home | Contact Us | Advertise With Us | Sitemap | Privacy Policy
© 2006-2014 Supply Chain Digest - All Rights Reserved
.