Gilmore Says:

The problem with Wal-Mart’s approach is that it made no distinction – wave and after wave of RFID mandates (sort of) to companies which saw only cost and no real idea why they were doing it outside of the mandate, and where the financial sense was highly questionable on its face.  What do you say? Send us your comments here

It was another great year for SCDigest. We are expanding in many directions, and enjoying readership, web traffic, and financial growth. Thanks to all of you for being part of it!

In these weekly First Thoughts columns, we covered a lot of ground this year.

Unquestionably, our biggest story was the two-part “Unplugged” interview we had with Procter & Gamble’s Dick Cantwell on RFID (you’ll find a link to the full transcript in the right-hand column).

We had a number of people tell us it was the best piece they have ever seen on RFID. As most know I have been short term cynical on RFID in the consumer goods to retail supply chain, though very positive in other areas and long term in retail, when cost and performance improve.

Cantwell passionately argued for the value prop right now – and certainly scored a few points.

I believe the reality is something of a hybrid, and supported by subsequent events. Cantwell noted, for example, that P&G had some products for which it believed RFID could drive immediate value (e.g., promotional displays), some for which the ROI was emerging, and some where it was a challenge to find.

The problem with Wal-Mart’s approach is that it made no distinction – wave and after wave of RFID mandates (sort of) to companies which saw only cost and no real idea why they were doing it outside of the mandate, and where the financial sense was highly questionable on its face. There – I said it.

What’s happened of late, of course, is that Wal-Mart is changing direction, focusing on using RFID to drive in-store execution for promotions and selectively targeting products/categories/applications where it hopes to demonstrate value to all sides. Why it took this long to get here is a mystery, and I’ll only note that if you look at what we’ve said all along versus the hype machines, I believe you can see who had the better perspective.

We also had a great debate on Supply Chain Best Practices – trying to answer the question of whether they really exist, given the uniqueness of each company’s strategies and environment. We received feedback from many consultants and practitioners, and there were strong opinions on all sides of this issue (see this week’s feedback section below for some of the best).

Actually, I haven’t offered my complete perspective on this yet, and have been thinking about it a lot. More early 2008.

Another piece we got started and haven’t yet found room for part two was on optimization versus simulation in supply chain software applications. There is a growing trend towards using simulation in planning to get a better feel for how things might work out, driven in part by the increased focus on risk reduction. We’ll get to part 2 of this shortly.

Speaking of supply chain software, the past few years have been generally good times for software providers, and we noted the key factors in why companies were making aggressive investments in new technology. A few weeks later, Investors Business Daily noted the same thing. Coincidence? We think not. But through 2007 at least, many of you were upgrading old systems and adding new capabilities.

We also had fun with “self-organizing logistics systems,” a theory which Dr. John Bartholdi of Georgia Tech and others have deployed to significantly and almost too easily improve the productivity of order picking lines, as well as some manufacturing work centers. If you aren’t familiar with Bucket Brigades, as I was not, we encourage you to take a look.

Our list of the top 10 Supply Chain Megatrends was also well received. I have given presentations on this topic at a number of conferences, and we’re going to use 2008 to drill down into each trend in more detail.

In July, I did a review and comment on the book Dragons at Your Door: How Chinese Cost Innovation is Disrupting Global Competition. If you are a manufacturing company, I highly encourage you to read my review or even better the book. The sobering message for Western manufacturers: Chinese companies are far different from competitors from low labor cost countries in the past – and they are coming after your business with relentless precision.

My piece on The Two Paths for DC Automation also generated a ton of feedback. The thesis – at a high level, a variety of forces will cause distribution operations to either automate highly or have very little automation. The middle ground will get squeezed. Many agreed – many others did not.

And if you missed it last week, our annual No Blah, Blah, Blah issue featured what we considered the best presentations on supply chain and logistics for 2007.

From a Supply Chain Digest perspective, we launched a new web site in March, but as these things go there will be a whole new one I hope the first week of January. It is simply awesome, and I know you will enjoy it. We have so many resources available – please visit often.

We’ve had great response to our weekly Supply Chain by the Numbers and Supply Chain Graphic of the Week features added this year. You’ll find this week’s selections on the right, as always.

A few months back, we added a new publication, SCDigest On-Target, which offers feature stories across seven subject categories, from Distribution to Manufacturing to Procurement, each week. The idea was to offer a breadth of coverage across the wide range of interests of our 36,000 readers, and frankly to find another outlet for all the great content we create. We have had good feedback on that too.

We also began The Supply Chain Digest Letter, our hardcopy publication (electronic also available) that takes a single issue and explores it in-depth. We did six in 2007, including the issue on Warehouse Management Systems mailing now (still time to subscribe for that). There will be one each month in 2007.

And as we have announced, starting probably in February we are launching yet another hard copy newsletter, CSCO (Chief Supply Chain Officer) Insights, to be edited by Gene Tyndall., Due to the ever growing costs of mailing, the hard copy subscription will be limited to supply chain and logistics executives, but the electronic copy will be available to all.

Not bad for a relatively small team! We welcome your input on how we can do better. I did a lot of speaking this year, including participating in the internal supply chain/logistics meetings of a number of large companies. Look forward to more of that in 2008.

Any reaction to our list of the most popular SCDigest stories of 2007? How can we improve to better meet your needs? Let us know at the feedback button below.

Let us know your thoughts at the feedback link below.