Archives for March 2010

Readers are interested in Logistics Education

By Herb Shields | 03/30/2010 | 11:46 AM

I had a very interesting question come to me from Vladi Neuschlova in Slovakia in response to my post regarding the development of the future logistics workforce.  Her question was how to describe the importance of logistics to people who do not work in the field.  I can suggest two examples that almost everyone can understand:

·     First, logistics is important to all people in their daily lives.  It is the logistics and supply chain process that bring raw materials from fields, mines, or out of the earth and converts them to the products that we all want – food, clothing, medicines, etc.  The logistics process moves all the raw materials from the source to the factories, and finally to the stores, markets, and homes where all of us as consumers use the products in our everyday lives.  In the USA, logistics costs represent about 10% of GDP, another indicator of its importance to the over-all economy.

·     Second, logistics is the process we use to bring aid to people in areas that have been affected by a natural disaster.  Unfortunately we have had 2 recent examples – the earthquakes that affected Haiti and Chile.  People with logistics experience plan and execute the movement of relief supplies, the arrival of doctors and medical supplies, and the materials needed most urgently to restore all of the infrastructure impacted by a natural disaster.  Logistics providers – airlines, ocean shippers, trucking companies, etc.-  help get the people and products to the areas in need.

Another request came to me from Keith Griffith, head of the Education Department of the Economic Development and Workforce Board of Stanislaus County, California.  His organization is working on curriculum development for the local school system.  It is interesting how many different consultants have been asked to work on syllabus writing, curriculum development, teacher’s aid materials, etc.  The State of Illinois sponsored the writing of several logistics teaching modules intended for freshman level high school students. I am more than happy to share any materials that I have.  The Council of Supply Chain Management Professionals has several DVD’s, and other material available that introduces the subject of supply chain and logistics to students for career planning purposes.  www.cscmp.org

If any of my readers has other comments and suggestions regarding the very important topic of logistics education, I welcome your input.

So What Were Three DC Velocity Bloggers Doing in Scranton Pennsylvania?

By Herb Shields | 03/17/2010 | 7:55 AM


Imagine how interesting it must have been to have representatives from both retailers and marketing companies sitting together for a whole day discussing the state of the economy and how it is impacting supply chains in the consumer goods area.


Kane is Able, a Scranton headquartered third party logistics company invited about dozen people to participate in a Supply Chain Think Tank with its executives.  Chris Kane, DC Velocity blogger on Distribution, Jack Ampuja on Supply Chain Optimization, and me on Consumer Goods all participated.  (Full disclosure, this was a Kane sponsored event intended to provide some useful input for Kane’s strategic planning.)


We covered topics from the projected growth in the global economy to what is happening on the store shelves of your local grocery.


The consensus view on the economy is clearly recovery, but slower than many would like to see.  John Metzger of Penn State’s Center for Supply Chain Research showed us some information that confirmed the impressive growth in market share for warehouse clubs and concerning trends for traditional department store and grocery chains.  Another related topic was the amount of debt that is now affecting the ability of the federal and state governments to deliver basic services.  Average base salaries and benefits are now higher for the average government employee versus the average worker in the private sector.  Whatever your political views, this is a challenge as we move forward.


Lee Stucky, retired Senior VP and Chief Administrative Officer of Wal-Mart International spoke eloquently about the three C’s that drive Wal Mart’s supply chain focus -  Communication, Collaboration, and the Customer. 


Sustainability is a high priority for all of the marketers who were represented.  Issues such as reducing the amount of water used in products and to make products as well as continuing efforts to reduce packaging, energy use, etc. need to remain on your radar.  Most publications including DC Velocity address sustainability in almost every issue.


Another energy-related subject that impacts everyone’s supply chain is the cost of oil, our discussions centered around the possibility of $100 a barrel oil sometime during 2010.  Efforts to reduce the amount of empty trailers on the road, fuel consumption, etc. need to stay high on everyone’s list to avoid the price breaking the current record $147 high.


Lastly, something for everyone in consumer goods to think about:  Kevin Smith, retired CVS Supply Chain VP, reported on research that shows that 86% of CPG consumer purchase decisions are made by the customer at home.  This is probably driven at least in part by the recessionary impact on impulse buying versus what is “on the list”.  However shoppers are likely to go on line in the search for low prices, deals, and coupons before they leave to shop.

The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.

About Herb Shields

Herb Shields

Herb Shields has run Chicago-based HCS Consulting since 2000, helping clients across multiple industries and in higher education improve their supply chain strategy and execution. Shields has more than 30 years as an operations executive for capital equipment, automotive, electrical machinery and consumer products companies. As vice president of materials management at consumer goods company Helene Curtis, Shields led the supply chain organization that helped Helene Curtis win "Vendor of the Year" awards from Wal-Mart Stores and Target Corp. Shields has a B.S. degree in Electrical Engineering from Clarkson University and did graduate work in business at Bowling Green State University.


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