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October 15, 2015 - Supply Chain Flagship Newsletter

This Week in SCDigest

bullet Trip Report: CSCMP Conference 2015 Part 2 bullet SC Digest On-Target e-Magazine
bullet Supply Chain Graphic & by the Numbers for the Week bullet Holste's Blog/Distribution Digest
bullet New Cartoon Caption Contest Begins bullet Trivia      bullet Feedback
bullet New Supply Chain by Design and Expert Insight bullet Videocasts and On Demand Videocasts


Download this Ebook to learn the top eight reasons supply chain analysts say they prefer supply chain modeling software to spreadsheet-based solutions

first thought


Supply Chain Graphic of the Week
The Global Economy, Especially Developing Countries, Continues to Wobble

Time for Consolidation, Maersk Line CEO Says
Can American Apparel Keep Made in USA Model?
Interesting Senate Ploy to Fund Highway Bill
BNSF Almost Done with Ambitious Parallel Track Effort



October 13, 2015 Contest

See The Full-Sized Cartoon and Send In Your Entry Today!

Holste's Blog: Understanding Sorting System Technology


Weekly On-Target Newsletter:
October 13, 2015 Edition

New Cartoon, Can Retailer Stay Made in US? Rails After Truck Freight and more

CSCMP Report: Five Supply Chain Design Lessons from Benjamin Moore and How One is Used by Amazon in their 1-hour Delivery Service

by Dr. Michael Watson

WMS Myth Number 2 - Fast Path Implementations are Always a Good Thing

by Mark Fralick



Townhall Meeting! The State of Retail-Vendor Relationships 2015

Results from SCDigest's New Benchmark Study of Retailers and Their Suppliers - and SCDigest's New Index to Measure the State of the Relationships

Featuring Interactive Event Format - Live Expert Panel and Audience Questions

Featuring Greg Holder,CEO, Compliance Networks, Kim Zablocky, President,

RVCF (Retail Vendor Compliance Federation), Victor Engesser, Retail Executive Advisor, RVCF and SCDigest's Dan Gilmore


What size ships (number of TEU) will the expanded Panama Canal support when it opens sometime in 2016?

Answer Found at the
Bottom of the Page

Trip Report: CSCMP Conference 2015 Part 2

Two weeks ago, as usual I offered my summary of and commentary on the Council of Supply Chain Management Professionals' (CSCMP) 2015 annual conference, where I joined some 2900 other practitioners, academics and solutions providers of all stripes for several days in San Diego. (See Trip Report: CSCMP Conference 2015).

Last week in our OnTarget newsletter, we also summarized which companies participated in presentations and panel discussions this year and over the combined 2014-15 events. It's interesting to see, and I encourage you to review the lists - you can't have a conference without a sizable number of companies stepping up to the plate like that. (See What Companies Contributed to CSCMP 2015?).



"Hallmark doesn't expect the 18 metrics to ever be all green in a month, because the supply chain is about managing trade-offs."


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In my first column on CSCMP 2015, I mostly took a look at the conference as a whole, and summarized keynote presentations. As promised then, I am back this week with summaries of several of the breakout sessions.

There were three 75 minute breakouts both Monday and Tuesday, and then a choice of three 90 minute "mega-sessions" Wednesday before closing ceremonies. On the first two days, breakouts were organized along 16 tracks, down from 20 in 2014. Whether that is good or not is purely a matter of taste. There were clearly far too many tracks (30+) not that many years ago. But I would much prefer a return back to four 60 or even 45 minute sessions each day.

As your trusted reporter, I attended a session in all three times available both Monday and Tuesday, and a mega-session on Wednesday, keeping my dance card full. Here are my favorites from what I saw.

I always try to get into a least one session in the supply chain innovation awards track, where six companies/organizations vie for the top and runner-up spots presented on the last day of the conference.

I saw two this year, including an excellent presentation from George Soleas of the Liquor Control Board of Ontario (LCBO) , which has developed an intriguing system for palletizing cases of beer, wine and spirits before they are sent to retail stores, using existing material handling system technologies (but with some proprietary software).

Building pallets of beer is hard work and expensive. At a Toronto area DC, LCBO previously had operated 28 palletization lines that required two operators each, who of course make their own decisions about how to build a pallet, with much moving of cases around during the process. The results are often far from excellent pallets - unstable construction, lots of air space, etc.

In response, the LCBO began to search for a better way. Rejected early on was a robotic arm type palletizer - it just didn't work, Soleas said in response to my question, though exactly why is not clear. Regardless, in great summary, LCBO developed a system in which cases coming on a conveyor from the picking area are scanned for dimensionality (i.e., L x W x H). They are then moved to a "case buffer" section on which each case is horizontally transferred each to a holding spot on the left or right of the conveyor.

When the buffer is full, sophisticated algorithms virtually construct the pallet, one tier at a time. Cases needed for each tier are released from their temporary storage locations, and fed to a traditional case palletizer which constructs the load - at a rate of like 1300 cartons per hour.

Key of course is the pallet building algorithms, a very sophisticated tool which also included robust simulation capabilities to test the concept initially, even modeling "physics" such as gravity and force in terms of recommended pallet builds and their quality to weed out bad algorithms.

The results have been outstanding. 15 conveyor lines now feed 8 palletizers, and account for 77% of all cases volumes out the door, with more to come. Labor costs have been reduced by $2.2 million annually (providing high ROI), product damage and the number of workplace injuries are way down, and trailer cube utilization they believe is up from 75% to 85% based on denser pallet builds.

LCBO won the award and I am glad - this was true innovation. How as a government organization it will commercialize this system is a big question, as Soleas himself noted.

Also in the innovation track was Jozo Acksteiner of HP, who spoke on the company's approach to "geographic analytics." Traditional network design type projects are hampered by the need to collect huge amounts of data, which is time consuming (months) and expensive, Acksteiner said, and in some cases don't deliver a feasible recommendation after all that work, sending everyone back to the drawing board.

The geographic analytics approach is just what it says - using a much smaller subset of data to map network nodes and flows in a visual way, so that supply chain managers can see their supply chains. Generally supported by a subject matter expert to guide the process plus a more technical person, the approach can often allow supply chain managers to make a decision based on this visualization alone, or at least whittle the problem down to a more manageable set of options for traditional network optimization. Several examples of how HP has used geographic analytic tools (built mostly on fairly simple platforms like Google Earth) were presented, including decisions made about which DCs to consolidate, and what DCs should serve what customers.

I must say the crowd was very interested. It seems overly simple to me, but I may be wrong. There apparently is high demand for this capability, operated as a shared service, from HP supply chain and business managers. I would have liked some details on how the decisions made here really compare with those coming out of true network optimizer. I plan to follow up on this.

Robin Baggs and a colleague from Home Depot did an ultimately strong presentation on how global sourcing can work with transportation to reduce total logistics costs. The presentation just brought home how complex this really is, beginning with product design (can the leaf blower be easily disassembled before shipping to allow use of a lower cube box?), through product packaging decisions , country of origin impacts (affects logistic costs in many ways - e.g., is their enough total volume from a country/region for freight consolidation? What are the local security requirements?), and more. Total landed cost is also very dynamic, not static (changing ocean rates, bunker fuel costs, currency swings, etc.), which companies sometimes forget.

Home Depot now embeds senior transportation managers into the leadership meetings of the global sourcing teams, and logistics analysts into the sourcing operational meetings, supporting a cross functional view of what is optimal.

On Monday , a team from Hallmark, led by Libby Allman, gave a very good presentation on the company's development of a "balanced scorecard" for supply chain. Prior to the effort, Hallmark was very siloed in its approach, with each supply chain function having its own set of metrics, totaling maybe 75-80 in total, and not really driving supply chain efficiencies end to end.

For the effort, Hallmark referenced the SCOR model and its level 1, 2 and 3 metrics and Gartner's hierarchy of supply chain metrics, ultimately sort of blending the two approaches. The highest level metrics - those most closely aligned with company strategy - are service levels at the retail shelf, supply chain cost, and return on assets. The metrics model flows down from there, now comprising 18 total metrics, up from the 15 initially defined.

This scorecard is not really tied to performance reviews - it is instead a way to monitor the health of the supply chain, indicated in a simple red-green mode (no yellow here) for which metrics hit the targets each month and which didn't. If missed, then root cause analysis is performed to determine why (e.g., brought inventory in early to mitigate risks of West Coast port disruptions). Hallmark doesn't expect the 18 metrics to ever be all green in a month, because the supply chain is about managing trade-offs. Functional metrics and goals are now more tightly linked to this overall scorecard. Good stuff.

I am out of space. These were the best four of the six sessions I attended. I may summarize the other two and the mega-session in a few weeks.

Hope you enjoyed the summaries. More details on some of these sessions soon in our OnTarget newsletter.

Any thoughts on these CSCMP breakout session summaries? Did you attend any good breakouts? Let us know your thoughts at the Feedback button (email) or section (web form) below.

View Web/Printable Version of this Column

October Videocast:

Making Supply Chain Business Intelligence Pay Off for Mid-Market Companies

New Technology Options and BI Use Cases Delivering Competitive Advantage and ROI

Includes demystifying supply chain BI, the keys to deployment success, key trends such as the move beyond scorecards to dashboards, and how new BI offerings are enabling cost-effective, easier to implement BI solutions to mid-market and even many larger companies

Featuring Donna Fritz of TAKE Supply Chain,Tom Dadmun, former head of supply chain for high tech manufacturer Adtran and SCDigest's Dan Gilmore

Wednesday, Oct. 28, 2015

Wednesday's Videocast:

Innovations in Supply Chain Design

How Smart Companies are Finding New Ways to Reduce Costs and Improve Performance

Includes a Number of Real World Case Studies about how Leading Companies are Putting these new Applications to Work

Toby Brzoznowski, Exec Vice President at LLamasoft, Dr. Michael Watson, Partner Opex Analytics Lead Author, Supply Chain Network Design and Dan Gilmore, Editor, SCDigest

Wednesday, Oct. 21, 2015

On-Demand Videocast:

The Six Uses Cases for Distributed Order Management Systems

Distributed Order
Management is Rising!

From Omnichannel Fulfillment to Enterprise Order Hub, We Detail the Six Use Cases for DOM - New Insight Only from SCDigest!

Featuring Dinesh Dongre, VP Product Strategy, Softeon and SCDigest's Dan Gilmore.

Available On Demand


We received some decent feedback on both our daily video coverage of CSCMP 2015 and our request for ideas to improve the conference. You will find a selection below.

Feedback of the Week on SCDigest's CSCMP Coverage


I am a proponent of conferences like these for many reasons. I think it is short sighted to rule them out as being frivolous, or just a vacation. Alas, I wasn’t able to attend this one mostly because I am Canadian, which means expensive long distance travel, and a 30% currency conversion on top. Sadly that makes one of the best available conferences also the most expensive.

That being said, I just want to thank Dan and SCD for the daily video highlights and subsequent print articles. I watched them the minute they arrived and will read everything I can about the conference and its content. Great job on coverage for those of us who are interested.

Steve Hogg, P.Log. CCLP
Director, Supply Chain Services
Fraser Direct Logistics

  More on CSCMP Coverage  

I don't know how Dan gets it done, but these daily video summaries are excellent!


Keep it up!


Dawn Herring
Richmond, VA

  Feedback on Ideas to Improve CSCMP Conference  

I think the conference was great with respect to structure, organization, logistics.

My comments for you to consider given Dan's participation on the organizing committee for 2016 (which is in and of itself great news):

1. The conference is WAY too expensive.

a. Particularly for small business people like me
b. What can be done to cut costs? (e.g. I don't need motivational speaker on Wednesday.)
c. I think if the price dropped attendance would rise. My hypothesis is based on conversations with people who would consider going if price were lower

2. Content

a. I liked the structure along the 4-5 conceptual pillars
b. Lots of recycled material and "updates" from previous years, but I guess that is fair and to be expected
c. Too many consultants and vendors presenting (sometimes even solo, which is not acceptable)

3. Attendance by non-US logisticians

a. Disappointingly low
b. Could be a truly global conference
c. Obstacles:

i. Price. (Idea: a discount for attendees from outside the US?)
ii. Content. Too US-focused.
iii. CSCMP leadership and staff have no sensitivity whatsoever for non-American perspectives. Either for the needs of the individual professional to the needs of non-US RTs.

Erik Markeset


My feedback on CSCMP:

- The selection process for the awards favors those who have the resources to get themselves elected. Why not make this a vote among the members? Never heard of the Leancor CEO, although his acceptance videos were great.

- The keynotes are not all that relevant - there should be more by industry experts, maybe in smaller format

- The track chairs seem to be the same people every year - the topics this year were particularly boring as well as the content (the ones I went to)

- I found the panels hard to follow - maybe they should be in smaller setting where it is easier to interact.

- I agree with your comment on having 4 hour long sessions instead of 3 for 1.5 hours


- To bringing in more people:

1) Reduce the cost of attendance - I would send more people if it were cheaper and had more learning content

2) Convenient location - Midwest

3) Provide more ways to interact - small topic related meetings where you can have a meaningful discussion

Name withheld by request



Q: What size ships (number of TEU) will the expanded Panama Canal support when it opens sometime in 2016?

A: Approximately 13,000, up from just 5000 currently, but still well below the current largest megaships with almost 20,000 TEU capacities.

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