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Supply Chain 2015 - How Am I Doing?
Supply Chain Graphic of the Week and Supply Chain by the Numbers
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  Newsletter Archives                Can't View In E-mail? August 25, 2011 - Supply Chain Newsletter

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Understanding How Technology Improves the S&OP Process

A Step by Step Review of the S&OP Process and how Technology and Decision-Support Tools Improve Decision-Making at Each Phase

Tuesday, August 30, 2011


Building Next Generation Supply Chains for Discrete Manufacturers

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Wednesday, August 31, 2011


Supply Chains in Motion: Driving Adaptability, Flexibility and Visibility

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Next Generation Supply Chain Planning - It's Here

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Featuring Joe Shamir, CEO, ToolsGroup and Andrew Lewis, Head of Global Supply Chain Planning at RS Components

Wednesday, September 21, 2011

This Week's Supply Chain News Bites
Supply Chain Graphic of the Week: Technology for Managing Network Inventories

This Week's Supply Chain by the Numbers for August 26, 2011:

  • Green Energy Jobs Lacking
  • China Overtakes US in PCs
  • Freight Tonnage Slow Growth for a Decade
  • Goods News for Capital Goods Spending


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August 17, 2010 Edition

Last Chance Cartoon, DC Users Love Wearables, Top SCM Schools Debate
and more

Holste's Blog: Conveyor Industry Sales Channels - Additional Content & Prospective from Industry Leaders
Top Story: DC Associates Say Wearable Wireless Terminals Offer Big Productivity and Ergonomic Gains
Top Story: Factors to Consider when Choosing Between Manufacturers and Systems Integrators for Conveyor System Projects
Top Story: Understanding Conveyor Industry Sales Channels Ecosystem and its Impact on Vendor Selection

Supply Chain 2015 - How Am I Doing?

In late 2009, based on a presentation I had done for a conference, I came out with a list of 10 fairly specific predictions for what I thought would happen in the supply chain by 2015. Have subsequently given versions of this presentation a number of times.

As I said then, it is easy to give vague predictions about the future, and very safe to say we are going to get more integrated, more collaborative, more optimized, etc. We will. But getting beyond that level of prediction gets a lot harder, and just as tricky is timing. This stuff is going to happen eventually - but when?

So I put myself out on something of an analytic limb with these 10 predictions about things that would happen by the end of 2015, which were:


"Technology is not the challenge now, but what data is needed for better decisions. True dashboards are the next logical direction after scorecard work becomes largely done. "


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1. A majority of companies will have reconfigured their supply chain networks: Many companies have supply chain networks developed for a different era. Fuel prices, green SCM concerns, virtualization and more will lead many to fundamentally rethink those networks over the next few years.

2. Supply chain planning and execution will start to blur: A topic we covered in detail in a major report, the need for response based on market demand and other factors is outstripping current planning cycles. Tactical and even some operational planning become completely intertwined with execution, causing changes in organizational structures, processes and technology.

3. We see substantial drops in overall inventory levels: Inventory levels have remained flat for many years now. But the lessons of this recession - that maybe we can get by with less combined with supply chain simplification programs and new technology - really will drive step change drops in inventory levels by 2015.

4. Web-based supply chain software comes to dominate the landscape: I haven’t completely been on this bandwagon until recently, but by 2015, this is how it is going to be - which has many major implications. More confident of this than about any other prediction on the list. Once this becomes the lead approach for almost all vendors, the shift will happen rapidly.

5. Green drives transportation collaboration: The logic of transportation collaboration and the financial benefits haven’t done it. The capacity crunch of 2005-06 almost did, but then that went away. Green will finally do the trick, and we will see much more cross company load-linking and even sharing of capacity between competitors. But does this commoditize logistics?

6. Visibility to everything, all the time: The technology is really here now to have it, and despite RFID’s current lack of direction, it will become very commonplace by 2015. Understanding what to do with this information is the real challenge.

7. Common deployment of real-time performance management: Scorecards are rear-view looking; dashboards help you make decisions right now. A few companies have already developed these kinds of capabilities; they will be widely deployed by 2015.

8. Distribution centers will take one of two paths: Lean and un-automated (and very flexible), or automated to a level hard to imagine today. Again, something else we have written about in the past. The robots are coming.

9. Supply chains focus turns to emerging markets: This is simply where the growth will be - perhaps explosively so. This will impact product design, pricing, logistics and much more. Those that get it right will have huge corporate advantage - as companies like Procter & Gamble smartly focus on “micro-logistics.”

10. Digitization increases impact on the physical supply chain: A tsunami wave of digitization is happening, dramatically impacting physical supply chains, often in not obvious ways. We all know that itunes is putting CD makers out of business, but that filters down to record stores and even producers of the plastic resins used to make CDs. Think the future is bright for watch and mid-level camera makers when you will have both in your cell phone? I have many more examples. Look forward on how your company - and your career - might be impacted by digitization.

So, how am I doing? I am going to grade myself. Naturally, SCDigest readers can also give me a grade.

1. Re-configured Networks: Kind of a no brainer, in a sense, and happening apace. Gartner in one of its "predicts" for 2011 noted basically the same thing. Many networks will look quite different by 2015 for both current coast and globalization reasons.

2. Blurring of planning and execution: Absolutely happening, and accelerating. Technology is driving it. Factories are being dynamically rescheduled multiple times per day by some companies, as just one example. Operational planning and execution are becoming one. Need to change org structures to truly leverage.

3. Inventory levels will drop: Cautious yes, but data is inconclusive. Not sure if predicted drop in SKU counts will stick (see WalMart's retrenchment). The curve is shifting, but may not be as pronounced as I predicted by 2015.

4. Cloud-based software dominates: A definite yes, in my opinion, and am more convinced than before. It is better in the end for everyone, vendors and users, though whether it works for complex, multi-app optimization is still unclear.

5. Green drives transportation collaboration: Well, it may not be just "Green," but I do think we will finally see a lot more of this by 2015, though perhaps a bit less than I expected. Still, there are signs. Kraft's "collaborative transportation engineering." A pilot program currently under way in the UK for multiple consumer goods companies to ship to retail in one truck. It will happen, and have a profound impact on logistics - and careers.

6. Turbo-visibility: Happening faster than even I expected. More on this soon.

7. Real-time dashboards: Coming on strong too, though some people still confuse dashboards and scorecards. Technology is not the challenge now, but what data is needed for better decisions. True dashboards are the next logical direction after scorecard work becomes largely done.

8. Two paths for DCs: I am a little less sure about the "two-path" aspect as I am about coming new generations of very highly automated DCs. This is happening, with a number of adoptions already and more coming, driven largely by automated case picking (ACP). May take a little longer, but I am convinced it will be fairly commonplace by 2015, at least in terms of new facilities in high cost markets.

9. Supply chain focus on emerging markets: There sure isn't much growth in the US and Europe. Note P&G and WalMart's (separately) aggressive investment and thinking in these areas. Companies are (e.g., Siemens) regularly announcing new product designs for the less wealthy - and even poor - consumer/businesses. Not unrelated to point #1 about reconfigured supply chain networks.

10. Digitization and the supply chain: There is a finite end to this at some point, but we are nowhere near it. Just think, for example, the impact that cell phone payment systems are going to have on many other physical supply chains (credit card makers, POS terminals, check companies, etc.). There are hundreds of these examples. Be looking over the curve as to how it could affect your company and career - often in not immediately apparent ways (e.g., you supply magnetic stripe encoding systems to credit card companies).

So, I gave myself a pretty good score. Timing may be a couple of years off on a few of them. But I am biased. You can let me know your grade.

How do you think Gilmore's predictions for 2015 made in 2009 are holding up? Let us know your thoughts at the Feedback button below.



Dan Gilmore


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Feedback of the Week - On Rethinking  China Part 2

I appreciate reading your articles on China.  Thoughtful, complete and insightful.  And for people familiar with China .... most is "spot-on".

I've been in China off-and-on for the last 8 years.  For the last 6 months, I've been on-site in Shanghai, Jinnan, Taishan, Ningbo, Changhouz, and Minhang Technical Development Zone.  Over this time, I've gained a tremendous appreciation for the Chinese culture and behaviours.  For sure, China is large with diversity of thought.  Yet, in most instances,  China is of one mind.  They, and each of it's citizens, are bend on improvement.  Young family seek the means to make money, and accumulate wealth to send their child to the best schools.  People work in all hours of day-and-night to simple make a few extra RMB.  Businesses look for ways to use their income on the best projects and to develop their employees and young managers.  Governments work to enable businesses to prosper via straight-forward and rapidly implemented policies to incentivise local growth consistent with a national 5 year plan.    

As you routinely observe, the growth here is phenomenal.  In all matters of industry and government.  That is not to say China does not have problems.  Issues consistent with other countries such as pollution, safety, worker rights, women rights, taxes, economic disparity, social equality, corruption, etc. are all challenges.  Yet, China seems better positioned to meet these challenges.  Why, because change is pervasive throughout the country and has been for centuries.  

In my view the key difference in China is leadership.  I'll qualify my following comments.  As a general rule, the quality of leadership from local to national levels is exceptional.  There may be out-liers, but in general, Chinese leaders take their responsibilities very serious.  They look for steady progress to the future rather than "the big bang" theory.  They are focused on their particular business, rather than the business of others communities, or nations.  They are thorough in their approach to problems and challenges.  They are quick to accept responsibility for their actions, rather than deflect consequences to others.  In short, the Chinese leaders in business and government is very pragmatic.  They are intolerant of poor performance.  Perhaps if our political and business leaders were more intolerant, America would have fewer failed business, fewer incompetent legislators and a sustained GPD greater the3 %.

In summary, China will continue to grow, prosper, and likely remain inwardly focused on infrastructure, social well being, technology innovation and education.  They will likely spread their form of social responsibility worldwide.  Whether in medicine, finance, technology, business practices, governance, and leadership, the Chinese are changing at lightning speed.  I have no doubt, the western world will learn more over the next 25 years.    As China emerges on the world scene, I see a better place.

Steven D. Abbott


More on Rethinking China:


This goes to the heart of my main point in your January 2011 “Guru Predictions” piece (First Thoughts, Jan. 21).  The U.S. needs to provide a combination of incentives and legislation to repatriate some of the work which has been sent to China and other locals over the past decade.  The biggest concern of the U.S. voters is not the war in the Gulf or whether government went too far in the bailouts, but rather the need to get a job, a roof over their heads, and to put food on the table. 


I do agree with Mr. Fung’s statements that over time there will be a balancing caused by risings in China, but changes over 5 years are not going to produce U.S. jobs in 2011-12.  Nor will they help the current administration get re-elected.



Steve Murray

Principal Consultant and Chief Researcher

Supply Chain Visions



I say that it’s about time OUR pundits start shouting from the mountaintops how the U.S. is moving to reclaim/rescue its status as the world’s #1 economy.




McLain Oppy
Supply Chain Consultant
The Open Sky Group, LLC


I believe we all recognize that developed countries have ridden the wave of prosperity on the backs of developing nations. As we become one world we will inevitably see a leveling of wages, opportunities, etc. My hope is that we can raise the level for everyone while not drowning ourselves.


Jamie Elder


I think your arguments can be summarized in one phrase - “Sour Loser”. Supply chain is but a tool in the hands of the investor – the corporate giants who in their greed for more money and global market share have been sacrificing US jobs for the sake of corporate gain and all in the name of efficiency and globalization. Wasn’t it obvious when entire factories in the US were being closed and people laid off?


After enjoying low prices for almost 2 decades, I believe it is very unfair and selfish on your part to say that the west paid the money for Chinese growth as you have failed to recognize the humungous efforts put in by the Chinese workers who toiled in miserable conditions to enable consumers in the West to continue to buy goods at extremely cheap prices. Fact of the matter is that the Chinese earned their growth through hard labor and intelligent use of resources just like any other nation.


Yonus A. Siddiqui

Vice President Projects

e2e Supply Chain Management (Pvt.) Ltd.

Karachi, Pakistan.

Q: ERP giant SAP was started in 1972 by a handful of engineers from what other tech leader?
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