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February 9, 2012 - Supply Chain Newsletter
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This Week In SCDigest

bullet MODEX 2012 Full Review and Comment bullet SC Digest On-Target e-Magazine
bullet Supply Chain Graphic of the Week and Supply Chain by the Numbers bullet This Week In "Distribution Digest"
bullet Cartoon Caption Contest Continues This Week! bullet Trivia
bullet White Papers Available For Download bullet Feedback

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MODEX 2012 Full Review and Comment

Materials Handling Editor Cliff Holste and I spent a very busy couple of days at the new MODEX show at the World Congress Center in Atlanta this week.

This event from the Material Handling Industry of America (MHIA) basically replaces the North American Material Handling show that for the past decade or more had been held in Cleveland and prior to that Detroit. As such, it is in a sense considered the "off year" show from the larger ProMat event from MHIA held in odd-numbered years in Chicago. MHIA would prefer for potential attendees not to think of it that way, but the reality is in general the ProMat show is larger and the exhibitors use bigger, larger displays with more equipment at ProMat, if for no other reason than spending that kind of big money every year is just too expensive.


GILMORE SAYS:

"Cliff and I spoke with several medium-sized firms that were at MODEX with specific interest in automating (in various forms) their DCs."

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The Cleveland show frankly had just gotten a sort of "tired" feeling in recent years, and as MHIA rightly noted was pulling from a regional basis from much the same Midwest market as ProMat (these are national shows, of course, but any event pulls heavily from the surrounding region).

So, MODEX in Atlanta was born, and it was a good move. The show floor was larger than in Cleveland, with something like 550 exhibitors. Though the crowd was light on Monday, the day after one of the most hyped Super Bowls in history, it picked up quite nicely on Tuesday, and the show had a good "buzz" to that day. It's hard to describe what that means exactly, but for show veterans like Cliff and I let's just say you know it when you feel it.

It is MHIA's goal to make MODEX into more of a supply chain show, which I guess we will say is a work in progress, as a couple of MHIA officials privately acknowledged to me. It was a fine show, but felt like a usual MHIA type event, without any change yet to more of a overall "supply chain" theme. I will note, to be clear, that includes many software exhibitors, most heavily in WMS and related supply chain execution areas. Also, to help expand the show, MHIA opened up the exhibits this year to non-MHIA members for the first time. I was told that about 160 of the booths were filled with non-MHIA members, and this will really open up the potential for future MODEX shows.

We offered extensive video coverage and comment on MODEX earlier in the week, and you can of course still see our Day 1 and Day 2 reviews, as well as a handy page that has the different topics and interesting solutions we covered as individual clips, so you can just view those that are of most interest to you - think it is worth taking a look.

As opposed to the past few MHIA shows, clear themes didn't really jump out so much to us this year, but after two long days on the show floor, a couple of things did in the end stand out.

First is just that our real sense from hardware and software vendors is that overall, things are pretty good. After a dismal 2009 and not so great 2010, 2011 was strong for many, and most vendors we spoke with seemed generally bullish about their sales "pipelines" and prospects for 2012. As just one of several examples, material handling systems company Intelligrated is building new manufacturing and headquarters space to handle its growing volumes.

The drivers of this growth: (1) as we've reported on many times, the clear focus by many companies on getting back to strong top line and unit volume growth without adding back the headcount and fixed costs they had before the recession; (2) the pressures of e-commerce not only for traditional retailers but virtually every other type of company, especially those not used to "eaches" picking; (3) an aging workforce demographic in distribution; (4) low, low interest rates; and (5) growing interest in "mid-market" type companies that typically did not much invest in automation in the past.

This last point, in fact, is its own mini-theme. Material handling automation, and to a lesser extent advanced distribution software, have traditionally not been in high demand from mid-market (say sales under $1 billion) companies. It was viewed as too expensive and too risky. But now, the same distribution pressures facing larger companies (including e-commerce) are hitting mid-sized companies too, while the equipment and especially total cost of ownership of many of these systems are coming down. That simply opens up the market to more and more companies. Cliff and I spoke with several medium-sized firms that were at MODEX with specific interest in automating (in various forms) their DCs.

The message out of all of this: while I am certainly no shill for the automation industry, if your company has been "hunkered down" since the recession, still worried about the direction of the economy (who isn't?), etc., it may be worth popping your heads up to see what some investment might do for you, because your competitors may just be moving ahead without you. I probably saw a few of them at the show.

Automated Case Picking (ACP) remained a strong theme, and Cliff and I were just blown away at the number of yet new solution providers (e.g., System Logistics, others) that we weren't familiar with until this week. The hottest action is clearly in the beverage industry, where there are now a high number of proven, working solutions, but food and grocery is not that far behind in terms of interest, as well as some nibbling and more by other sectors. More on all that very soon in our 2012 ACP Report.

We covered more than a dozen new or almost new solutions at the show that really caught our eye. Everyone of them is on the Day 1 or Day 2 videos, or can be found on the individual clips pages. I do not have room for them all here, but will highlight a few - I encourage you also to sample the individual clips. A select few of those include:

The DC simulation software from CreateaSoft: the product has been around for awhile, but was new to me, and was heavily refreshed a couple of years ago. The problem in this space has just been that it always took just too long and was too hard to build the simulation. CreateaSoft says it has solved a lot of those problems by the new way it does DC physical and process modeling, taking the time down to just 1-3 weeks. Just as interesting is the new ways the simulations are being used. Before, simulation was mostly built to test out concepts for a new DC and heavy automation. Here, examples were shown of the tool being used to test say the impact of moving to task interleaving, or understand right now why this morning throughput numbers in the DC were down today.

Savoye Retrotech showed a very intriguing new AS/RS systems that rather than using traditional cranes instead employs a high speed shuttle type system to move pallets on the outside and even within the storage structure. Had a case study of a very larger CPG company that is using the technology to load a huge number of trucks per day in one DC with not that many people, and doing so in truck stop sequence order for multi-stop retail deliveries.

Voxware announced its voice software was now available to run on the Android operating system, meaning it could be used on "consumer-ish" cell phones and tablets. But I learned you have to really certify that on each individual manufacturer's equipment - determine what type of device really makes sense in a operations environment. Motorola released a new heavily ruggedized Android tablet that was shown running RedPrairie's WMS software. This will be a very key topic over the next several years.

Out of room. Good show. Rest of the solution reviews on the video pages.

Any reaction to our MODEX review? Were you at the show? What caught your eye? Let us know your thoughts at the Feedback button below.

 

SUPPLY CHAIN NEWS BITES

Supply Chain Graphic of the Week:

Where is Investment in Material Handling Automation?


This Week's Supply Chain by the Numbers for Feb. 9, 2012:

  • GlaxoSmithKline Says Happy (Inventory) Days are Here
  • Freight Spend Keeps Rising
  • More Locomotives on the Way
  • New Technology Shaves Conveyor Widths

CARTOON CAPTION CONTEST CONTINUES THIS WEEK!

January 31, 2012 Contest




See The Full-Sized Cartoon and

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ONTARGET e-MAGAZINE

Weekly On-Target Newsletter:
February 9, 2012 Edition

Heavy Truck Bill Dies, Goldratt Part 2, Fuel Cell Truck Infrastructure and more


Holste's Blog: Walking -- Good Exercise For Personal Fitness, Bad For Distribution Center Productivity

THIS WEEK ON
DISTRIBUTION DIGEST

Top Stories: News: MODEX 2012 Day 1 Video Review and Comment

Top Story: The 10 Myths of Labor Management Systems

Vendor News: Intelligrated and SDI Group USA Launch Material Handling Systems Business Operations in Brazil

Visit Distribution Digest


WHITE PAPERS
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SUPPLY CHAIN TRIVIA

Continuing on the MODEX theme, the increasingly popular concept of Motor-Driven Roller (MDR) conveyor technology, in which the rollers themselves are powered in short sections (versus a long belt-drive), was first invented to solve a problem for what government agency?
Answer Found at the Bottom of the Page


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Tuesday, February 21, 2012

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YOUR FEEDBACK

 
We had several letters this week on our story this week on the death of Dr. Eli Goldratt, father of the Theory of Constraints, in 2011, a story frankly we and lots of others had missed. We publish a few of them below.

Feedback of the Week: On Dr. Eli Goldratt:



 
comma

I, too missed this news - how was it so little noted?

I remember the outstanding interview you did with Dr. Goldratt in 2004 or 2005. I printed out both parts at the time, and still have them in my files someplace. It was an outstanding piece of work.

It is a shame that the Theory of Constraints, while core thinking for its thousands of adherents, still hasn't gained the type of mainstream following that Lean and Six Sigma have achieved. Many, including myself, believe that applying TOC should precede later programs based on Lean and SS for maximum results.

I certainly hope TOC does not fade in the aftermath of his passing, but I fear that it will. Even though Goldratt had indeed ceased to be active at the Institute, he was a frequent conference speaker, and was still viewed as sort of guiding the organization from behind the scenes - whether that is accurate or not.

Now, we'll all know that he is not.

It will be very interesting indeed to see how well TOC maintains its position over the next 10 years.

Andrew Smith
Long Island, NY


comma
 

More on Goldratt:



 
comma

Thanks for catching up on Goldratt. At Niagara University,  we use The Goal as a textbook supplement in the Supply Chain Management courses. It was used in the MBA section when I started teaching 10 years ago,  and we even had training films featuring Eli Goldratt himself.

The students found the films a bit boring and very focused on Goldratt.  As one said “a little bit of him goes a long way”. Still, the value of The Goal is huge and more managers should read the book and use the concept.

A Buffalo area company I do business with provides the accounting support for The Goldratt Institute so I was invited numerous times to attend programs when Goldratt was featured. The timing never seemed to work so I never did get to meet  but now regret that I didn’t make time to do so.

Jack Ampuja
Supply Chain Optimization


comma
 
 
comma

I had the pleasure and great honor of working directly with Dr. Goldratt for the last 4 years of his life.

He is undoubtedly one of the greatest thinkers ever, and Nobel Prize worthy for sure.

He was a beacon to all of us in The TOC consulting firm he founded and in the entire business world.

Amir Davidi
Goldratt Consulting

comma
 
 

SUPPLY CHAIN TRIVIA ANSWER

Q:Continuing on the MODEX theme, the increasingly popular concept of Motor-Driven Roller (MDR) conveyor technology, in which the rollers themselves are powered in short sections (versus a long belt-drive), was first invented to solve a problem for what government agency?

A: The United States Post Office, more than two decades ago, to solve issues related to mail trays push up off the conveyor when they were in accumulation zones.

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