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September 22, 2016 - Supply Chain Flagship Newsletter

This Week in SCDigest

bullet Supply Chain Software in the Cloud and Other Key Trends 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 Winners bullet Trivia      bullet Feedback
bullet New Expert Column bullet New Videocast and New On Demand Videocast
  Download New eBook:
Learn how Software can Help Consumer Goods Companies Move Into the Private Brand Market and Further Maximize Profitability
first thought


Supply Chain Graphic of the Week
US Manufacturing Growth is Simply Flat


Amazon's Assault on the Apparel Market

Truckload and Intermodal Rates Continue to Fall
XPO Logistics Facing Multiple Union Drives
Telsa Car Hacked on Highway


Learn how Retailers can Implement Technology to Help Manage the Entire Product Life Cycle and Global Supply Chain


Innovation in 3PL Capabilities: Perspectives from Shippers and Providers

What Do Shippers Expect from 3PLs in Terms of Innovation? How Are 3PLs Responding?

We would appreciate you taking this brief survey, with separate paths for shippers and 3PLs. In the near future, we will send all respondents a copy of the survey results aggregated across all respondents. We know you will find it valuable.


Week of August 22, 2016 Contest

See Who Took Home the Prize!

Holste's Blog: Growing Economy Drives Investment In Automation Projects

Weekly On-Target Newsletter:
September 21, 2016 Edition

Last Chance Cartoon, RFID Framework, Goods2Person, Ecom Losses and more

The "-abilities" of Global Trade Management: Overcoming FTA Admissibility Hurdles

by J. Anthony Hardenburgh
VP, Global Trade Content
Amber Road

How Do Key Market Trends Impact Your Demand Planning?
by Bill Macdonald
Executive Vice President, International Sales
Demand Solutions, Inc.


Supply Chain Software Trends and Opportunities 2016 Benchmark Report 

From the Search for Greater Agility to the Coming Era of Cloud Software, Where are Companies Headed?

Prefer to view the results instead? Watch the on-demand version of the Videocast summarizing the survey results:


Which city is not on the general rotation of host cities for the CSCMP annual conference: Chicago, Dallas, Philadelphia, San Antonio, Denver, San Diego?

Answer Found at the
Bottom of the Page

Supply Chain Software in the Cloud and Other Key Trends

Is supply chain software deployments in the Cloud about set to take off?

I believe - and have believed - the answer to that is Yes.

This change will have huge ramifications for both supply chain software users and providers, undoubtedly changing the software vendor landscape in the end, and opening up whole new ways in how supply chain software will be delivered and consumed. 


I've just scratched the surface of the interesting data in the excellent report. Take a look. Is Cloud-based supply chain software simply where it is all headed?


Send us your
Feedback here

For all the discussion about Cloud-based software, following somewhat related concepts such as Software as a Service (SaaS) and "on-demand" software before that, the reality is we are early in the journey towards the coming age of Cloud software.

Currently, Cloud-based software represents a small percentage of total deployments, but that number will change dramatically over the next three to five years.

In 2012, I predicted that by the end of 2015, Cloud-based deployments would be the majority of new supply chain software implementations. That prediction may have been a little off in terms of timing, but not in direction, as Cloud momentum continues to build.

Already there is significant traction in areas such as Transportation Management Systems (TMS), Global Trade Management (GTM) solutions, and supply chain visibility, but progressing along nicely in every category of supply chain software as well.

Cloud, however, is not the only trend that will create an inflection point in supply chain software. So too will advanced analytics, and relatedly the concept of "machine learning."

Advanced analytics, in some but not all cases connected to "big data," offers new approaches to supply chain decision support, potentially upending, for example, traditional methods use for forecasting, and ushering in a supply chain world where companies will increasingly be able to predict potential problems or opportunities before they occur.

Machine learning is just what it sounds like, the ability of the software to learn from its successes and past errors - in areas such as forecasting - and improve its approach to drive continuous improvement. 

The reality is that in many ways the move towards Cloud will be an enabler of advanced analytics, as it allows data to flow from more sources.

After many years of steady but somewhat incremental progress in supply chain software capabilities and paradigms, these two trends - Cloud-based solutions and advanced analytics - promise to truly shift the status quo in exciting, if not yet fully understood, ways.

So with that as a backdrop, SCDigest recently conducted a survey and subsequent report on supply chain software issues and opportunities, with a special focus supply chain software in the Cloud. The full report is very good - you can download it here: Supply Chain Software Trends and Opportunities Benchmark Report 2016.

Here are some highlights.

As we often do in these surveys, we started by asking respondents to rate their company's level of maturity in both supply chain processes and technology.

We converted a 1 to 7 scale for both questions, with 1 being the least mature and 7 the most mature, into categories, with a 1 score converted to "very low," 2-3 low, 4 average, 5-6 high, and 7 very high, with the results as presented below.

As is always the case, respondents ranked their level of supply chain process maturity ahead of how they viewed their supply chain technology capabilities, though not dramatically so. For example, 43.1% rated their process capabilities as high, versus 33.4% who felt this way about their supply chain technology.

Similarly, the average score for process maturity was 4.1, just above the mid-point of 4.0, versus 3.7 - below the mid-point - for technology.

Another view is that 26.1% of respondents rated their process capabilities as low or extremely low, versus 31.7% that placed their technology capabilities in the lower scores.

We also asked respondents to rate a list of barriers to supply chain performance, on a similar 1 to 7 scale, with 1 being the least barrier, 7 the most.

As can be seen below, the lack of ability to design/execute end-to-end processes came out on top, with an average score of 4.5, just ahead of overall level of supply chain technology support. A lack of internal collaboration across functions, a barrier that is in a sense similar to challenges with designing end-to-end processes, came in as the third ranked obstacle, with a score of 4.4.

Only "limitations in current supply chain design" fell below the mid-point in our list, and that just barely, with a score of 3.9.

It is interesting to note that respondents saw lack of internal collaboration as a greater barrier to improved performance than they did a lack of external collaboration with trading partners. We were also surprised that "overall skill levels" didn't rank more highly, given all the press of late around a "talent crisis" in supply chain. There were a number interesting comments on this question that you will find in the full report.

Ok, let's turn now to a couple of data points related to the Cloud sub-theme.

We asked for each respondents' general view on deploying supply chain applications in the Cloud. As seen below, more than one-third of respondents said that Cloud will be "the future direction for all/almost all of our supply chain software," a percentage much higher than we would have seen just two years ago.

What's more, another 37.6% indicated Cloud would be the "future direction for some but not all of our supply chain applications."

Just over one quarter of respondents said that Cloud-based software would be adopted for only a small portion of total supply chain applications or not at all - and I bet they will turn out to be wrong.

Those providing Cloud-based supply chain software solutions promote many benefits from this approach. We wanted to see what respondents thought about these potential advantages, rating a series of benefits on our 1 to 7 scale, with 1 the least benefit and 7 the most.

As can be seen in the chart below, faster deployments topped the list, with a very strong average score of 5.4. That was just ahead the directly related benefit of "faster time to value," with a score of 5.3. 

But several other benefits in the list also had strong scores of 5.0 or higher, including ease of upgrades, total cost of ownership, lower IT support costs, and lower upfront costs.  Only offering a "pay as you go" pricing model fell below the 5.0 mark, and even that was still well above the mid-point, with a score of 4.6.

I've just scratched the surface of the interesting data in the excellent report. Take a look. Is Cloud-based supply chain software simply where it is all headed? Again, I say Yes.

What's your reaction to these data points? Do you believe supply chain software in the Cloud will soon dominate? Why or why not? Let us know your thoughts at the Feedback section below.

View Web/Printable Version of this Column

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

September 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.

Thursday, September 29, 2016

New 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 received several short but interesting emails from David Schneider's gust Firsth Thoughts column on "In Supply Chain It Pays to Put it in Writing," which you will find below.

Feedback on Putting It in Writing


After you put it in writing, you should sign it and date it. Take one more look at the document prior to submitting or sending the document, and decide if you would accept the document as complete and on time.

The lesson I learned was that, if you put your name on a document, you are putting your name and reputation on the line. This applies to all documents, spreadsheets, or reports that are generated.

Joe Kirchner, CPIM
Senior Supply Chain Analyst
Ciber, Inc.

Note from David Schneider:


We are pulling from some deep places in the readership. Joe, 40 years ago we didn't call it Supply Chain, it was Physical Distribution, right?

This is a great practice you outline. Consider it a test that you have to put your name on at the top. Are you going to score high?

David K. Schneider


Thanks for a very detailed timeline of events to teach a valuable lesson.

I've learned this myself the hard way, as well as witnessed it carried out even more.

Basically, it's the old summation of "Why is there never any time to do something right the first time, yet there's always time to do it over?"

Jeff Branchick


I agree 100%.  Got to put it in writing !!!!


Todd Basham
Senior Project Specialist – Rollouts and Special Projects
Estes Express Lines



Q: Which city is not on the general rotation of host cities for the CSCMP annual conference: Chicago, Dallas, Philadelphia, San Antonio, Denver, San Diego?

A: Dallas.

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