This week in SCDigest:
Trip Report: WERC and ISM 2011 Conferences
Supply Chain Graphic of the Week and Supply Chain by the Numbers
New Cartoon Caption Contest Begins This Week!
SC Digest On-Target e-Magazine
New Expert Contributor: Voice Picking: They Gotta Love It!
New Expert Contributor: How Watson Could help Supply Chain Management Operations
This Week In "Distribution Digest"
  Trivia Feedback
Become a Sponsor
SCDigest Home Page
  Newsletter Archives                  Can't View In E-mail? May 19, 2011 - Supply Chain Newsletter

Featured Sponsor: IHS

Just one counterfeit incident poses risks ranging from catastrophic brand damage to potential loss of life. Your supply chain is under attack and may already be infiltrated.

Receive a complimentary Counterfeit Risk Assessment/BOM Analysis from IHS. Click here.


Supply Chain Risk Management: Separating Meaningful Indicators from Background Noise

Using a New Information Tool From
Dow Jones to Increase its Visibility to Sources Of Supply Chain and Supplier Risk

Featuring Dr. William Killingsworth of MIT,
Ezra Duong-Van of Dow Jones
and Dirk Martin of Safety-Kleen

Tuesday, May 24, 2011


Vendor Compliance 101: It's about Supply Chain Excellence, not Chargebacks

Part 2: Best Practices in
Vendor Compliance Optimization

Featuring Gough Grubbs, SVP of Distribution & Logistics for Stage Stores,
Tim Divic, DC Manager for Stage Stores,
Greg Holder, CEO of Compliance Networks

Wednesday, May 25, 2011


WESCO Drives Continuous Distribution Center (DC) Improvement with Hands-Free Wearable Terminals

From Traditional Handheld and Truck-Mount Radio Frequency (RF) Terminals to a New Generation of "Wearable" Mobile Wireless Devices

Featuring Larry Mosier, VP of Distribution Centers & Transportation at WESCO, Mike Rusnak, Distribution Center Manager at WESCO, Mark Wheeler, Director of Supply Chain Solutions at Motorola Solutions

Wednesday, June 15, 2011


Harry & David Moves from Best-of-Breed WMS to SAP Extended Warehouse Management

This Week's Supply Chain News Bites
Supply Chain Graphic of the Week: Rising Labor Costs in China

This Week's Supply Chain by the Numbers for May 20, 2011 - WERC & ISM Edition:

Kimberly Clark Co-Locates Co-Packers; On-Time Shipping Performance; Supply Management must be Hot; 11% in 13 Minutes


Receive a Complimentary Counterfeit Risk Assessment/BOM Analysis from IHS. Click here.



May 18, 2011 Contest

See The Full-Sized Cartoon and

Send In Your Entry Today!



Weekly On-Target Newsletter
May 19, 2010 Edition

New Cartoon, Drayage Bill Risk, WERC/ISM Videos, China Wage Surge and more


By Scott J. Yetter

Voxware, Inc.

Voice Picking: They Gotta Love It!


By Karen Butner
Global Supply Chain Management Leader

IBM Institute for Business Value

How Watson Could Help
Supply Chain Management Operations

Trip Report: WERC and ISM 2011 Conferences


Well, it was a busy conference week, as I attended the Warehouse Education and Resources Council (WERC) and Institute for Supply Management (ISM) conferences, both in Orlando, missing as a result both the SAP (also in Orlando) and RedPrairie user conferences due to the conflicts. In general, right or wrong, I will go to an association event over a vendor event, though there is no doubt that most association events are getting more and more commercial each year as they search for cash...

I try to regularly attend the WERC event, but had only been to the ISM conference once before and that was some time ago. I can say both conferences were very worthwhile, and share a sort of admirable attendee "commitment" to the respective disciplines of distribution center management and supply management/procurement that is different than most such professional organizations.

Thousands of you have seen my video reviews of each conference, but if you would like to view them they can be found here: WERC Video Review, ISM Video Review. I am also offering some highlights here.



"Kemp made the great point that while many companies consider the two dimensions of impact and likelihood in analyzing supply chain risk, a third dimension is needed - velocity."


Send us your
feedback here

One of the things that WERC does well is a set of roundtable meetings where pre-registered attendees usually numbering 15 or discuss a particular issue. I decided to go to an afternoon roundtable session on crossdocking in the DC. It was actually a repeat session from the morning, both of which were "sold out" based on pre-registration, but I managed to get a seat anyways as there were a few no shows, and conveniently the gate keeper taking names stepped away for a few minutes. (Yes, I snuck in.).

Think I caused moderator Mike DelBovo of 3PL Saddle Creek Corp. (who did a fine job, BTW) a bit of heartburn when I mentioned upfront that I thought crossdocking outside of retail was largely a myth. I came out of the session with that opinion largely intact, though recognizing that a lot depends on how you define crossdocking. For example, one definition says cross docking includes "pool distribution," where a manufacturer sends goods to a local DC (usually 3PL run) where goods are moved directly to local delivery trucks, as well as merge-in-transit. An expanded definition increases the use of the technique.

I meant specifically cases where non-retailers are "opportunistically" cross docking to reduce handling costs, but this is very hard to do, for reasons ranging from FIFO issues to the challenge of marrying received product with stored items for an order. Retailers have it comparatively easy because of the approach where anything ordered or pushed can go on a truck using a "door per store" model is the norm, and obviates the challenges manufacturers have.

But the session was interesting. Companies want to understand how to make this work. One large consumer health care company receives offshored goods at specific DCs based on where the origin is (Asia, Brazil, Europe, etc.) and sends the receipts on to other DCs in the network. But the barrier to crossdocking those inbounds is that its existing WMS just doesn't do this well - the WMS wants the goods to be in a "pickable" location before it can allocate the goods to the DC "orders." The company can make the inbound receiving location pickable and then turn it off again, but that is a pain.

Somewhat surprising to me, system issues were highlighted as a big barrier to crossdocking. Another company said the way its ERP system worked, goods received one day simply could not be allocated for orders until the following day. So the best it could hope for is to have received goods sit in staging/temporary storage overnight.

Not exactly crossdocking, but a wine/spirits distributor has closed down several local small DCs by using "dismountable containers." That is, it now picks specific local delivery routes at its main DCs into containers that are put on special trucks (four to a truck). Those containers are then simply dropped in a parking lot, where they stand on "legs" until pick-up by the route drivers again using specialized equipment for that day's deliveries. Very innovative, but the high costs of the equipment means the approach can only be used for the highest volumes areas.

At the ISM conference, "supplier risk management" was not surprisingly a key theme, with a full track worth of presentations that seemed to be very well attended.

I went to a great presentation that included respected supply management elder statesmen Robert Kemp and Dave Nelson, but highlighted by a great presentation from Goodrich's Susan Modeland (who ironically, through no fault of her own, saw her presentation go down for awhile).

Kemp made the great point that while many companies consider the two dimensions of impact and likelihood in analyzing supply chain risk, a third dimension is needed - velocity. In other words, is the risk likely to be slow to have an impact on the company (say currency swings) or rapid (say a disaster at a single source factory).

Modeland asked how many attendees had really done a good job at identifying all their important supply chain risks, and very few attendees raised their hands. Goodrich hadn't either until a few years ago, but even more impressively has built some world class tools to manage supply chain risk.

That includes a real-time dashboard that gives executives a continuous view of the risk landscape, from sourced components that may be subject to high commodity or currency price swings to the status and reliance on key suppliers (when is the agreement up, and what are the risks in the upcoming negotiations).

Even more impressive is Goodrich's risk "register," in which the supply management organization monitors the global landscape looking for emerging risks at specific suppliers and from sources such as political and macro-economic developments, natural disasters and many more. Goodrich analyzes the emerging developments and filters them using various criteria, ultimately reporting consistently to senior management on those that matter, along with mitigation strategies suggestions. Think very few companies have taken it this far. (Presentation of the year candidate for sure.)

Ok, almost out of space, but will do a few more highlights. May be a part 2 on this, since I saw lots of good stuff.


  • Session on slotting optimization was packed - think this is an area where companies correctly believe there is a lot of opportunity for improvement.
  • Kimberly Clark has found great success with its "supply chain network of the future" carving out 25-50 thousand square feet of space for co-packing operations right in its DCs, versus the separate contract operations it and most CPG companies have used in the past. That according to Bill Lindeke, a director of distribution operations at KCC. This change eliminates much transportation costs out, and reduces inventory 1-3 days. KCC is using its traditional 3PL partners to do this, most of which had little experience to start. It has been a success, but there are many questions for both sides to get this right.


  • Advanced Micro Devices' Whitney Taylor did an excellent presentation on use of on-line auctionS. I was struck by the fact that probably 90% of the 100 or so attendees were using reverse auctions already - the key is gaining real critical mass. Absolutely key, Taylor made clear, is having a solid strategy on using on-line auctions generally and for each specific procurement "event."
  • Rodney Glass of HID (the former Hughes (as in Howard) Identification Systems) did a great job providing insight on supplier involvement in new product development. A key point: getting to good is not too hard; getting to great is much more difficult. My takeaway: this is almost exclusively a people/culture issue; the benefits can be great, and investment to get there is low.
  • Tyco's Shelley Stewart won the prestigious J. Shipman award. See my interview with Stewart in the ISM video.

More on all these soon on the pages of SCDigest.

My quick comments on both conferences - WERC: loved the detailed session descriptions and key slides in the conference program. Why doesn't everyone do this? Suggestion: get a little bolder with part of the program; tackle some tougher/newer topics.

ISM: Impressive size - more than 2000 attendees. Attendees highly committed to the supply management discipline - amazingly so, actually. Suggestion: some sessions more specifically addressing how to manage trade-offs (e.g., auctions versus partnerships, to be overly simplistic).

I will be back for both for sure barring tough schedule conflicts in 2012.

Did you attend wither the WERC or ISM conferences? What were your thoughts? What is your reaction to Gilmore's review and comment? Let us know at the Feedback button below.


Dan Gilmore


Send an Email


View Web/Printable Version of this Page


Holste's Blog:
Can A Poorly Performing Picking & Sorting System Be Saved?

Top Story: WERC 2011 Video Review and Comment
Top Story: Medical Device Maker DJO Global Finds Success with Mobile Robotic Picking System
Top Story: 16th Annual Third Party Logistics Study is Underway

Q: The fist J. Shipman award for excellence in supply management was bestowed by ISM in what year?
A: Found at the Bottom of the Page


We had a lot of Feedback on our piece on Donald Trump saying China is taking the US to the cleaners- most short and sweet, some we couldn't publish, many unsigned, quite a few who asked that we do not use their compay name.

Given all that, a selection of these letters below. None rose to "Feedback of the Week" status.

Feedback on Trump on China


Imposing an import duty would eventually force US consumers to purchase locally manufactured products which "should" result in increased manufacturing jobs. But is 25% enough to make it for more expensive? Ccorporations are still outsourcing jobs to China/Vietnam/India for greater profit margins with total disregard to its social responsibility (i.e employing some locals), because the end product is no cheaper to the consumer than when it was being manufactured in the US.

Consumers need to start boycotting "imported" products, this will eventually drive corporations to return. (No Sale / No Profit). If consumers boycott there is nothing the Government or the Chinese can do (and no trade war....) we manufacture and consume everything internally and I have a feeling most countries will do the same as its not only the US with this problem.

Government can help by forcing manufactures to "show" what / where / how each product is made and let the consumer decide. If one large corporation is boycotted, it will drive prices down and force them for the interim, to reduce profit and return home, the others will follow the minute we start buying American as their profits begin to evaporate.

Max Tenk


Did the Donald think about the US Bond Debt to China? Wonder why the politicians are walking a wide circle around China in terms of momentary rates and trade imbalance? Guess what none of these things happened recently, it’s been building for years (and including the Clinton administration). In short, greed was the culprit now the US is facing some hugh issues that aren’t in favor of hard negotiation skills. Maybe he needs to start practicing his Mandarin!

Jerry E. Durant
Chairman Emeritus
The International Institute for Outsource Management


I totally agree with Mr. Trump. Tariff, why not? Why do US politicians act so surprised when asking why did our jobs go over-sea? US Business leaders make more money shipping jobs outside the US. It’s up to our American Elected Politicians stand up and say let’s take away the incentive to sends jobs over seas and outsourcing; let’s tariff. What’s the alternative, do nothing? Who would complain about our tariffs, other countries that benefit from our loss? To be respected in the world, we should take care of our family, the US, then we would have the strength to help the everyone else.

If Mr. Trump is sincere in his believes, I hope he does run for office. His sound business ideas would resonate and perpetuate for the good of our country. Trump, why not?


Eric Lahoda

This article reminds me that there are only 3 ways for a country to produce wealth - farming, mining, and manufacturing. Everything else is just moving money from one pant pocket to another. Companies talk about "strategic sourcing" too as if they've discovered something new, but it isn't strategic if everybody else is doing it.

John Traynor


The US is not so much being run by stupid people who don't know what they are doing but by stupid people who have to do what they are told by the people who have lent them so much money that the US will never be able to repay. Therefore they are puppets on strings of the ones who control them and control world finance.

Ross Naddei

Megapulse Australia

Q: The fist J. Shipman award for excellence in supply management was bestowed by ISM in what year?
A: Unbelievably, all the way back in 1931. Witht the award this year to Shelley Stewart, there have now been 60 gold medal winners.
Copyrights © SupplyChainDigestTM 2003-2010. All Rights Reserved.
PO Box 714
Springboro, Ohio 45066