This Week on SCDigest:
Funny Stories from a Career in Supply Chain
Supply Chain Graphic of the Week and Supply Chain by the Numbers
New Cartoon Caption Contest Begins March 29, 2010
SCDigest On-Target e-Magazine
Expert Insight: Churchill Leadership Series Part 3
Expert Insight: Can Best of Breed WMS Solutions be Lowest Cost of Ownership?
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  Newsletter Archives April 1 , 2010 - Supply Chain Digest Newsletter

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Case Study on Real-Time Asset Tracking in Extremely Tough Environment


Rise of Wearable Wireless Devices in Distribution Center Applications

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Featuring Robert Ulery, Director, Engineering, OHL

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The Evolution of the 21st Century Supply Chain: Balancing Inventory, Workforce and Transportation

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Building a Smarter Supply Chain through Next Generation Optimization

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Grow Sales & Profits through Consumer-Driven Category Management

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This Week's Supply Chain News Bites
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Supply Chain Graphic of the Week: Automated Case Picking Summary Chart

This Week’s Supply Chain by the Numbers for April 1, 2010: Supplier Risk Management Software Rising; Smuckers to Jam Rising Supply Chain Costs; Green Tariffs Coming; Oil Prices Reach 19 Month High


New Cartoon Caption Contest

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Each Week:

Global Supply Chain
Trends and Issues

Expert Insight:

Behavior 3 - Churchill Maintained A Structured Routine That Worked Best For Him

by David K. Schneider


Churchill Leadership Series:

Behavior 3 - Churchill Maintained A Structured Routine That Worked Best For Him

Expert Insight:

Can Best of Breed WMS Solutions be Lowest Cost of Ownership?

by Chad Collins

Can Best of Breed WMS Solutions be Lowest Cost of Ownership?

HolsteHolste's Blog: Achieving a Successful MH System Operation Is More About Selection & Execution Than It Is About Equipment

Top Story: Should You Keep, Replace and Enhance Your Current WMS?
Gilmore: The Challenge of Building a DC Complexity Calculator

Visit Distribution Digest


Reader Question: Does a detailed count of every carton received from suppliers to our manufacturing plant make sense? Can we implement an auditing plan?

See our expert responses

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What do the initials in JB Hunt's name stand for, and what year did he start his trucking company?

Click to find the answer below
Funny Stories from a Career in Supply Chain

It’s Spring break and Easter time here in the US, and I have decided to use that as an occasion to lighten it up a little bit this week.


That’s in part based on the tremendous response we have had to our Supply Chain Cartoon Caption Contest – and some of the feedback we've received related to that. To be honest, we anticipated the cartoons would be popular, as just as a bit of fun, but it seems to be even deeper than that.


We have had a number of emails relative to the cartoons that caught us a bit by surprise. Dozens of you have written saying that this little bit of humor is a weekly treat that helps alleviate if just for a few moments the real stress and pressure that SCM and logistics professionals face daily, given the current overall environment, relentless cost pressures, lean staffing, and other tribulations.


So, continuing that theme, I thought it might be fun to recount some of the funniest supply chain stories I have heard or been involved with over my career. We plan to soon start a special page where others can submit their own humorous or interesting stories as well.


The stories I share below are all these to the best of my memory, which though usually quite good may subject to some error.


Take Cover!


When I was working at McHugh/RedPrairie, I was told of a story that happened not long before I joined the company. We were installing a WMS in the late 1990s at a distribution center of Winchester Corp., the firearms manufacturer. It was a joint implementation between McHugh (RedPrairie’s name at the time) and Price Waterhouse Coopers (now part of IBM Global Services).

Gilmore Says:

"Just to be clear,” the Unilever manager said, “The question is this: Just how much are you going to pay us to teach you how to build this solution so you can eventually sell it to others?"

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I don’t know the exact details, but somehow a pallet of ammunition was placed on the floor rather aggressively by a fork truck, or maybe hit by one passing by. Swear to goodness, a few seconds later, some of the ammo started going off. As Winchester DC associates and the McHugh and PWC on-site consultants started diving for cover, the pallet continued sending bullets off in all directions.


It must have been quite a sight. It didn’t last too long, and fortunately no one was hurt. I was told that after it was over and it was clear no one was hit, almost everyone in the DC started just cracking up.


My question always was: did anyone at Winchester grab a rifle out of a pick face and start firing back in self-defense?


JB Hunts’ Personal Auto-Vision


I heard this one from a former sales executive for truckload shipping giant JB Hunt.


In the early 1990s (I think), the legendary trucking leader JB Hunt himself somehow got into his brain an idea that he was sure was going to be a breakthrough approach for shipping cars from factories to auto dealers. He was no longer CEO but was still chairman of the company he started.


I have no ideas what it was, but apparently the concept captivated Hunt's interests for some number of months.


That led him to want to meet with auto dealers to describe and sell the concept, hoping to build some grass roots support he could take to the OEMs. The story I heard involved a visit to Florida, but there may have been other trips.


The local sale rep was told the big chief was coming - quite an honor - and that not surprisingly he wanted the rep to set up some sales calls in the area.


Ah, but not with regular shippers – with auto dealers! The rep tried, but the dealers had no interest. In fact, most had never even heard of the man.


“C’mon, this is the JB Hunt. He’s a living legend!” my contact said he exhorted the rep. “They have to see him. You’ll get fired if you can’t set some calls up.”


A few appointments were eventually made with reluctant dealer GMs, but whatever the idea was, it gained little momentum, and Hunt eventually dropped it altogether. The rep said he was never so happy to see a company executive leave town. Whether JB Hunt went to his grave in 2006 still believing in the concept I do not know.


Unilever Knew How to Buy Software


In the early 2000s, I and others were pitching Unilever NA on some supply chain software. It involved supply chain visibility and QA/recall management across the supply chain network. Quite cool.


We had some of the basic building blocks, but by no means a full blown solution, or – more importantly - the full operational knowledge we needed to build the solution out. We spent the better part of an afternoon discussing and white boarding key requirements for this new system with a 3-4 person team from Unilever.


That team was led by a wonderfully funny and smart middle manager who had been at the company for at least 20 years. As we wrapped up the day, soon to leave for a group dinner at Carlucci’s Italian restaurant in western Chicago, that manager said something like: “Ok, I think we have a basic framework here, but the big remaining issue is going to be about price.”


Yes, we said excitedly, that will be a key, but we certainly will work with you to keep it reasonable, or whatever mumbo jumbo supply chain software vendors say in such a situation. Internally, our team is all thinking “Here comes a really big sale.” The “buying signals” were obvious, as they say.


“Just to be clear,” the Unilever manager said, “The question is this: Just how much are you going to pay us to teach you how to build this solution so you can eventually sell it to others?”


We all laughed - but got the message. We eventually secured a pretty good sale, but the point had been effectively made – and Unilever paid a lot less than it might have. 


Dan Steps in it at LL Bean


I was an industry analyst for awhile, and in the late 1990s was asked to fly to Maine to give a presentation to managers at catalog giant at LL Bean, which was just starting to get supply chain religion.


Somehow, the discussion turned to benchmarking, and I said something like “You need to consider benchmarking all kinds of companies, not just in your industry, just as I know many types of companies from many industries have come here to see how you pick orders at extremely high velocity at Lands End.”


Lands End, of course, being LL Bean’s arch competitor.


I immediately corrected myself, and made some modestly funny joke out of it at my own expense. They seemed to forgive me. Sort of. But not really.


Don't FedEx It


As a quick sort of parallel, in the 1990s the company I was with needed to get a proposal to the United States Post Office for bar code data collection systems. Last minute as usual, we got the document done in the nick of time, and gave it to the mail department to send overnight express delivery.


Alas, they naturally and logically sent it via FedEx. Our sales rep told us the USPS decision makers were not happy with that decision. To the surprise of no one, we did not get the business...


I have quite a few more such stories, but am out of space. Will share some other ones during another lighter news week later this year.


Ok, not exactly Comedy Central stuff I’ll admit, but maybe this is the best you can get in supply chain. Hope you enjoyed – and maybe you have something even better. Would especially like some funny boss stories


Anonymity promised as required.

Any reaction to Gilmore's stories? Have you heard or experienced any funny or really interesting supply chain related stories in your career? Let us know your thoughts at the Feedback button below.


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We decided to run several distribution focused articles this week, starting with our article on How to Measure Inventory Accuracy. That led to our Feedback of the Week from Brian Butler of Procter & Gamble, who offers P&G's approach. Kate Vitasek also ways in with some good thoughts, as usual.

We also publish a few of the many letters we received praising Walgreens for its disabled worker program in its DCs.

All can be found below.

Feedback of the Week: On Measuring Inventory Accuracy:

I believe that focusing on only one measure is dangerous. We focus on several:

  • IRA = cycle counting by location (sampling, zero tolerance)
  • SAP/WMS reconciliation = % of SKUs / material records matching (zero tolerance) in ERP system and
  • Receiving Report Accuracy – audits of receipts for quantity/lot/location
  • Picking accuracy – audits of output
  • Inventory Variations = $ value difference (Total $ and % of total inventory)
  • Net Cases  lost by subcategory -  gains plus losses in physical cases / cases shipped for subcategories stired during the month (3PLs pay for net losses)

Brian S. Butler

Global Physical Distribution Operations Manager

Procter & Gamble

More On Measuring Inventory Accuracy:

In some respects calculating inventory accuracy becomes a variation of one of your favorite (and mine) laws - the “50% Rule”.  Nobody responsible for inventory wants to report poor accuracy, so they will come up with some means of counting and comparing which yields the result they are looking for.  That may be more reliable when an unbiased third party such as the accounting department or an auditing firm verifies the results, but the dynamics of stock movement would dictate that the auditor be present during the count, rather than doing random audits as is the practice.

Some folks take the position that when you have a goal of maintaining a lean inventory, and run a DC which has a high volume of movement, there will be a higher percent of variance (and lower accuracy %) reported because the volumes will induce a higher error count against a lower inventory level.  This is absolutely correct, and it is a penalty everyone who leans out their inventory pays.  If the level of unit count error stays the same, but the average inventory level is cut in half due to improved planning and management, the accuracy rate will take a hit.

In the case of a 3PL who is managing inventory for a client this can seriously impact fees where the SLA / Contract mandates a given accuracy %.  The answer – increase the stock level to bury the error count.

At one point we looked at coming up with a formula that included inventory turnover in the accuracy calculation.  We thought that if we could come up with a fixed “ideal turns ratio”, we could create a kind of level playing field benchmark by adjusting the calculated accuracy to reflect a standard turnover level.  The thinking/debate got complex and we pretty much decided that practitioners would likely still play with the numbers to get the desired results.

Yes, this is the most basic of questions, but the answer it turns out is not so basic.  At least not when the spin doctors get involved.

Kate Vitasek


Supply Chain Visions


On Walgreens' Disabled Worker Program:

As a parent of a disabled person I can only express admiration for what Walgreens and Randy Lewis are doing for this community. I know that my autistic son has the capacity to perform at multiple jobs if he were given the opportunity to try, and I can only wish that more companies in our country were as open minded as Walgreens is.

Arturo Hinojosa

Reddwerks Corporation

I think it is great that a company with this kind of economic power is throwing some weight behind helping persons with disabilities.  Recent stories in the mainstream media have not been overly positive for Walmart.  A program like this, if it is sincere, can go along way towards changing people's perception of Walmart.  I would really like to see this program be successful.  If Walmart can make this work effectively, then they can send a message to small and medium size companies that hiring disabled workers can be done without comprising the bottom line.

Richard Sesek, Ph.D., MPH, CSP, CPE

Assistant Professor

Auburn University Department of Industrial & Systems Engineering


What do the initials in JB Hunt's name stand for, and what year did he start the trucking company?


His real name was Johnnie Bryant Hunt, and he started the trucking company in 1966 with five trucks and seven trailers.