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October 6, 2016 - Supply Chain Flagship Newsletter

This Week in SCDigest

bullet Trip Report - CSCMP 2016 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 Cartoon Caption Contest Continues bullet Trivia      bullet Feedback
bullet New Expert Column bullet Videocast and New On Demand Videocast
  Download the Complimentary White Paper To Help Reduce Waste,
Improve Productivity and Thrive in Real-Time Retail

first thought


Supply Chain Graphic of the Week
Data Show a Wobbling Global Economy


What Companies Did What at CSCMP 2016?

New Jersey Hiking Diesel Taxes Big Time
Interest in Highly Automated DCs Growing
NRF has Bullish Forecast for 2016 Holiday Spend



Includes the Recent Gartner Report Entitled "Apply the Supply Chain Maturity Model for Better Demand Planning."


Week of September 28, 2016 Contest

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

Holste's Blog: Public Relations Verses Process Improvement

Weekly On-Target Newsletter:
October 5, 2016 Edition

New Cartoon, DC Automation, Dell's Green Innovation, RFID Implants and more

What Goes Into a Good Production Schedule?

by David Pleak
Demand Solutions, Inc.


Day 1 Day 2 Day 3


In the late 1980s and early 1990s, what supply chain initiative was championed by Roger Milliken of Milliken & Company, among others, as a life raft for the US textile and apparel industries?

Answer Found at the
Bottom of the Page

Trip Report - CSCMP 2016 Part 2

OK, I am back as promised after my overall review of the 2016 CSCMP annual conference in Orlando with some highlights of the educational sessions that form the bulk of the conference agenda.

Before I do that, I ran out of room last week to note Dr. Chris Caplice of MIT received the CSCMP Distinguished Service Award, a great honor, and in his wonderfully brief remarks he called for more collaboration between supply chain academics and practitioners. Academics too often are doing research that has little application for real-world problems, while practitioners are too often reluctant to reach out to academic resources to look at new ways to meet their operational challenges, he said.


Most insightful of all, Reade said companies and vendors need to start thinking more holistically about product flow across the DC.


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Also, Mary Long, VP of supply chain at Domino's, will be the CSCMP board chair for the 2016-17 term. For many years very active in CSCMP, Long stressed that a meaningful career in supply chain is really based on service to your team, your company and your professional discipline, and that CSCMP offers numerous ways to contribute to the profession, as she has done in many capacities.

As mentioned last week, there were 16 educational tracks this year, represented in three presentation slots on each of the first two days, for a total of 96 session. In addition, there were three "megasession" panel discussions on the last morning. There were also 16 tracks in 2015, but there were some changes, such as a new integrated supply chain track and one on government and regulations.

As a side note, this year, I believe for the first time, it was required that to be a speaker or panelist that you had to be a CSCMP member. Non-members submitting proposed sessions late last year, for example, were told they and/or their co-presenters would have to join up if they wanted to be considered. A bit of hardball, for sure - we will have to see how this plays out over time.

The best presentation I saw in the three days there was from Piyush Bharkava, a Dell procurement executive, who presented by himself on the company's remarkable development of an innovation culture to support its Sustainability efforts. The session was part of the CSCMP Supply Chain Innovation Award track.

It resonated with me in part because Bhargava admitted he was a bit of a skeptic at first, worried that Dell's famous focus on speed and efficiency in its supply chain would be compromised by swinging the Green pendulum a bit too far. As someone with a similar mindset, I was interested to hear Bhargava say his skepticism is now gone, with the core message here being you really can have a more Sustainable supply chain and lower operating costs.

The process started when company executives realized a few years ago that progress on a series of aggressive Sustainability goals was not occurring fast enough to achieve them by 2020, part of Dell's "Legacy of Good" mission that is championed by founder and CEO Michael Dell.

The only answer, it seemed, was to accelerate the pace of innovation to drive Sustainability faster into just about every facet of Dell's operations, from procurement to manufacturing to logistics.

Key elements, greatly summarized, include a powerful executive steering committee, "crowdsourcing" of ideas, an innovation Olympics for employees, innovation summits with suppliers and more.

The efforts have led to $200 million in lower supply chain costs over the past two years, If Sustainability increases supply chain costs, Bhargava said, the business unit leaders will simply lose interest, worried about seeing their margins erode. Also, 90% of Dell's aggressive Sustainability goals are on track for achievement.

As I predicted in my Monday video review last week, Dell did indeed win the innovation award, because it was an excellent story - and the Green entry almost always wins.

I am not the biggest fan of panels in general, but saw a good one on Tuesday on the warehouse of the future. It wasn't really all that much about that, but an excellent discussion nonetheless.

Ohio State University's Steve DeNunzio noted that the overall unemployment rate in the popular distribution center area of Columbus, OH was 4%, putting pressure companies to come up with the 20-30,000 DC workers the area needs, depending on the season.

And that before two new Amazon DCs come on-line in the area, requiring another 3000 or so DC workers. DeNunzio says he has recently seen DC job postings topping $18 per hour in the area.

DHL's Adrian Kumar sees a bright future for smart glasses and augmented reality for order picking in the DC, and the company has a number of pilots with clients going on across the globe, including in Columbus (e.g. pick paths visualized, virtual putwalls created through the glasses without physical lights). This is coming, I believe.

Steve Reade of shoe retailer DSW was very insightful, noting that companies need to spend a lot more time on the technology-human interface, as DSW did in its new sortation system a few years ago. It spent considerable effort designing the touch points, and even went to Germany for some advice from experts over there.

One result of that effort and design: the productivity rates for much older employees at these stations are the same as those for much younger workers.

Most insightful of all, Reade said companies and vendors need to start thinking more holistically about product flow across the DC.

We can no longer treat receiving, QA, reserve storage, various pick areas, etc., as sort of operational islands, he said. Flow must be understood and then optimized across all these disparate processing areas, something Reade said that we have only scratched the surface of today.

I will note my good friend and occasional SCDigest contributor Mark Fralick, now of GetUsROI and surely one of the top 5 most knowledgeable WMS experts in the world, more than 10 years ago had an email signature that said something like "Distribution - it's all about the flow."

Is this the next paradigm in DC design and technology?

On Monday, Mark Trusley of Nike, in another nice solo presentation, discussed a supply chain transformation of sorts at the athletic gear giant.

At the core is moving from a more traditional linear supply chain to a more responsive one. That means increased use of regional manufacturing strategies instead of an Asia-centered one, including producing its athletic gear in the US. 

I found very interesting Nike's goal to "win" in key metro markets across the globe as being key to its success. Trusley said the key to that in turn will be the ability to deliver same day in those markets, and perhaps also the ability to replenish its retail partner stores directly, without going through their distribution networks. The message here: ecommerce continues to dramatically change the supply chain landscape.

Nike also wants increased real-time inventory visibility across its retail partner networks - not only for itself, but for its customers. So, a consumer could go to the Nike web site and see what inventory was available right now not only from Nike but from all of its retail partners - that would be quite a paradigm shift indeed.

Interestingly, as it turned to a contract manufacturer here in the US that mostly had been in the electronics space, Nike was worried the company might have a steep a learning curve in this challenging industry. Turns out, Trusley said, the contract manufacturer's deep experience in global supply chains actually taught Nike a thing or two about supplier integration and execution.

I am out of space and am going to milk this for one more column. Next week: Intel on supply chain analytics, an interesting panel on the Uberization of freight, another good panel (all women) on supply chain innovation, and some advice on forecasting slow movers.

Did you go to CSCMP 2016? If not, why not? If yes, what are your thoughts? Any reaction to the educational session summaries this week? Let us know your thoughts at the Feedback button below.

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New October Videocast:

Understanding Demand Signal Repositories in Consumer Goods

All These Years Later, Why is a DSR So Hard to Build? A Path to Rapid Deployment and Lower Costs

In this outstanding broadcast, we'll review the basics of a demand signal repository, how it can drive tremendous benefits by enabling a demand-driven supply chain, and the barriers to achieving these critical capabilities.

Featuring  Dan Gilmore, Jeff Beckett, Founder at Retail Velocity and John Beckett, Founder and President at Retail Velocity and the inventor of the Demand Signal Repository in 1994.

Tuesday, October 25, 2016

New On Demand Videocast:

5 Emerging Technologies that will Change the Future of Distribution

Distribution Productivity has Never Been More Important - Here's How to Take it to the Next Level

In this outstanding Videocast, we will cover the latest in each-picking robotics, co-bots, artificial intelligence, autonomous vehicles, sensors, drones and droids.

Featuring  Dan Gilmore, Roger Counihan, Emerging Technologies Strategist, Fortna and Chad Hallerman, Sr. Director, Solution Design from Fortna.

Available On Demand

On Demand Videocast:

Reducing Order Picking Costs in the DC without Automation

New Solutions to Generate Significant Reductions in Order Picking Costs Whatever the Current Environment, With Little or No Disruption to Current Operations

In this outstanding Videocast, we will detail the wide portfolio of technologies that can be applied today to get your order picking costs headed back in the right direction. The broadcast will include real world cases studies.

Featuring  Dan Gilmore and Ron Kubera, Executive Vice President and Chief Marketing Officer at Lucas Systems.

Available On Demand


We're just featuring this week an interesting email exchange relative to a point made by Thomas Moore of Warehouse Optimization on a recent Supply Chain Newsmakers video, which argued that shippers can have much to gain through a better understanding - load by load - of their carriers' true weight limits.

David Schneider of David K. Schneider & Company took some exception to this notion, as you can see from his email below, and then Moore's interesting response back.


Both are friends of SCDigest - and we would be happy with one more ripost from Schneider!

Feedback on Knowing Carriers' True Weight Limits


The video segment brought this phrase to my mind: "Your performance will vary."

I’m not calling bull s--t on what the fellows from Warehouse Optimizers talked about, but there are practical factors that I think could be wrongly defined as "tribal" knowledge.

Fuel weighs something: Over the road diesel weighs about 7.1 pounds per gallon. So every 100 gallons of fuel on board adds 710 pounds to the GVW of the rig. Many drivers know this, and will wait to fuel until after they have scaled their load if they know that they are close to the 80K limit. Is this "tribal knowledge?" No, as it is something that is taught in many of the driver schools. While a local delivery rig may hold only 45 gallons of fuel in each side tank, it is not unusual to see rigs with 130 gallons on each side, sometimes more.

Driver and driver's gear weigh something: The driver's weight is obvious, but people tend to forget that drivers often live in their tractors - and the belongings can weigh in.

Accessories on the truck: Snow Chains, HazMat kit, skirts, Aero-tails, APU units, again, these all add weight.

Trucking companies do not have high consistency across the fleet. They may specify the same basic model, but the accessories will change the weight of the tractor and the trailer from unit to unit. Metal roof trailer or translucent plastic roof? Hardwood trailer floor or a composite material? E track or logistics track (they are different).

What is getting identified as "tribal: is really a reflection of the variability of vehicle weights based - the complexity of the fleet. If you ask a trucking dispatcher, a driver, or an executive what a truck weighs, they are going to give you the "average" because they recognize that the weight of a truck depends on many factors that are out of control.

David K. Schneider
David K Schneider & Company, LLC

Response from Moore:

This is great! It typifies the response that we often see. The Tribe has a set of assumptions that generate "safe" answers. Here is a very concrete example from companies that shall remain nameless - the total weight that refrigerated trucks can carry:

Company 1 45,000
Company 2 44,000
Company 3 43,500
Company 4 42,000

They all use about the same carrier base!

Data is the key. We took Swift's and JB Hunt's fleets and weighed the various combinations of tractors and trailer a few years back. Yes there was variation and yes we could not take the lightest tractor and the lightest trailer as our standard - but we developed a standard that 95% of the fleet could easily meet.

In another example, it turned out that JBH intermodal had a habit of sending sleepers into the client to drive the 25 miles to the ramp -the client asked them to stop doing that so they could get the extra weight on the loads. Will Cotten's example in the video is real. He ran many loads for, what turns out to be, one of our current clients!

To put this all in perspective, 8 years ago we got about 880,000 records of 5 axle trucks weighed by the DOT. Of those that were clearly weighted out (more than 69K gross) a very large number(81%) had >3000 gross weight available.

Thomas Moorecomma





Q: In the late 1980s and early 1990s, what supply chain initiative was championed by Roger Milliken of Milliken & Company, among others, as a life raft for the US textile and apparel industries?

A: Quick Response, which had mixed results at best.

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