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We don’t hold the key to the next great supply chain innovation. Everybody does.

By Contributing Author | 08/13/2018 | 7:56 AM

By Kevin Heath, Senior Vice President and Chief Procurement Officer at Georgia-Pacific

 

Technology has had more impact on supply chain-related operations during the last 10 years than it has in nearly a century. The supply chain is evolving, spurred by data collected in our warehouses and factories through the Internet of Things, giving us deeper insights into the most detailed processes.

With technology, we can drive maximum efficiency in nearly all elements of manufacturing and fulfillment.  But to fully realize its potential – to find solutions to tomorrow’s problems today – we need to collaborate. 

The world’s supply chain requires radical reinvention, but we have a tendency to only look for solutions within our own teams. This approach worked when robotics and automated guided vehicles were still on the drawing board – a change to warehouse operations years down the road. That doesn’t work anymore.

Now, the supply chain is expected to organize, track and deliver goods faster than ever and with more accuracy, but often with fewer resources. The Fourth Industrial Revolution hums along, and if we don’t adapt to it, we’ll be left behind. We can’t do it alone. The tools to create our next great supply chain innovations are already here, they’re just dispersed throughout our industries.

Consider these three benefits of working together to address supply chain challenges:

1. Gaining a point of view outside your sector

The similarities between the behind-the-scenes operations of an airline and a restaurant might not be apparent at first. However, logistics play a key role in putting a plane on the runway and a chicken sandwich on your table.

Georgia-Pacific manages one of the nation’s largest supply chains, moving paper, pulp and building materials through an extensive network of manufacturing operations, warehouses and re-load facilities before they reach the store shelves.

An airline, a restaurant and a pulp and paper company have the same goal – deliver a better customer experience faster and cheaper – which lends itself to a collaborative effort. When companies across industries partner to address a supply chain challenge, they can get insights they wouldn’t typically get from internal work teams. One company might have mastered augmented reality in inventory picking, while another has successfully employed robotics for packing. When we share these ideas without fear of losing a competitive advantage, we drive a more efficient supply chain.

2. Condensing time-to-market

Using the ‘silo’ approach – assigning our own work teams to solve our individual supply chain challenges – could eventually result in ideas that positively impact our supply chain operations. However, market demands are forcing us to step up the pace. Warehouses and factories need answers now, not five years from now. We need innovations that can move past the conceptual phase and become publicly accessible quicker.

By taking a collaborative approach, we can prove that two heads are better than one. If one partner has already figured out how to address a development roadblock, we can move through the ideation process faster, effectively determine what’s not feasible and focus our efforts on solutions that could be deployed in a much shorter time frame. 

3. Getting everyone involved

Teamwork has always been a crucial ingredient at successful companies. As workplace structures become less rigid – and as a new generation of supply chain professionals who are accustomed to working collaboratively rises through the ranks – encouraging team problem-solving can better prepare your organization for addressing tomorrow’s challenges.

When we come together across industries to develop new innovations, we set an example for teamwork. Such projects also give team members a chance to collaborate and network with their peers – from established companies and start-ups –as well as an opportunity to see how their contributions power the solution. It’s an opportunity to change company culture for the better.

The future of supply chain is now

Supply chain management is increasingly important in today’s businesses, but it’s also increasingly complicated. It’s time to lay to rest the idea we’re best served by going it alone. Collaboration on supply chain products across industries can lead to solutions we never would have considered, and it can bring those products to life faster.

So, leave your silos and start looking for the people and places that can help you think differently about your supply chain challenges.  You might find solutions where you’d least expect them. 

 

Kevin HeathKevin Heath joined the Georgia-Pacific leadership team in 2017 with his promotion to SVP, Chief Procurement Officer. Before that, he spent 12 years as Vice President of Strategic Sourcing & Procurement, Capital and MRO for the company. Prior to that, Kevin worked in several GP operations and held various roles including Engineering & Maintenance Business Leader. Kevin received his bachelor’s degree in Power Engineering Technology from Maine Maritime Academy, and his Master in Business Administration from the University of Washington.

How IoT Devices and Smart Sensors Are Helping Enable a New Era of Food Security

By Contributing Author | 08/10/2018 | 6:35 AM

By Mike Allen, Channel Manager – Eastern and Midwestern Regions at Advantech

 

The FAO states that one-third of all food produced each year is wasted. Lost or spoiled in subsequent stages throughout the supply chain—from storage to packing to transport and beyond—roughly 1.3 billion tons of food never reaches consumers.

Precise and constant refrigeration temperatures are critical when ensuring the safe delivery of perishable products such as produce, dairy and meat, as well as medicines. And while spoilage alone is an urgent problem in the global supply chain,insufficient temperature control can lead to more than waste; it can also create the perfect environment for the kinds of pathogens and micro-organisms that threaten public health, particularly when tainted products go undetected and are consumed by the general population. The CDC reports that foodborne illnesses affect 48 million people and result in some 120,000 hospitalizations and 3,000 deaths, with a total cost to the U.S. estimated at $77.7 billion annually,according to a new study calculated by Ohio State University consumer science professor Robert Scharff and published in the Journal of Food Protection.

With a sharp focus on sustainability, governments, researchers, retailers and enterprises are committed to improving processes by setting higher standards, increasing regulations and developing new technologies to reduce waste—and help the UN achieve a goal of “Zero Hunger” by 2030. In addition to new innovations being tested, such as the use of compressed natural gas in cold chain system tractors and the swapping of Freon for ammonia as a storage refrigerant, the implementation of advanced sensor technology is surging ahead in the cold chain system. Particularly with the U.S. Food and Drug Administration's (FDA) Food Safety Modernization Act (FSMA), which regulates the sanitary transport of food, shippers and carriers, smart sensors hold great promise to reduce food spoilage and mitigate losses while increasing profitability for all stakeholders.

Pharmaceutical and consumer goods companies, which face the significant challenge ofdifferent temperature requirements and disparate optimal ranges for multiple products, are increasingly utilizing sensors and Internet of Things (IoT) technology not only to monitor temperatures in cold chain in real time, but also to assist in tracking shipments and detecting equipment and vehicle malfunctions, among other things. In fact, in a 2017 survey from Deloitte and MHI, supply chain industry leaders identified sensors as one technology enabling an “always-on supply chain.” Of the 900 respondents, 43 percent indicated their companies relied on sensor technologies embedded in devices to track in-transit cargo location, monitor carrier performance, identify vulnerabilities for theft or tampering and monitor shipment temperature, shock and vibration.

The research firm Gartner predicts 20 billion IoT devices will be in use by 2020, with mass adoption of sensors encouraged not only by the proliferation of these devices, but also several other significant factors including a sharp drop in price, low barrier to entry, ease of implementation and capabilities expanding to enable longer battery life, greater durability and more data storage. All of which reduce the financial risk for implementation while providing greater supply chain visibility. In addition, enterprises are developing more feature-rich sensors. Recognizing that stability is key to food security, cost-effective, end-to-end solutions in each sector of the supply chain—from port to warehouse to trucking to retail delivery—have been designed to support the entire cold chain ecosystem. From in-vehicle computing boxes for logistics and fleet management to hand-held temperature readers and hand-held computers with long-range scanners that can be used with powered vehicle mount cradles, IoT devices and smart sensors are enabling a new era of cold chain intelligence. With a complete spectrum of embedded computing platforms and abundant domain know-how available, enterprises can do more than just ensure proper temperatures are maintained for the duration of food and perishables transport. They have the capacity to optimize and modernize warehouse design and retail monitoring—from remote locations as well as on premises—while ensuring that every product moves from the point of production to the point of purchase efficiently and with its integrity intact.

Better visibility across every inch and mile of the supply chain has the potential to drive growth for businesses while contributing to a healthier planet. Whether a company takes incremental steps toward digitization or moves full steam ahead to achieve a competitive advantage, the ultimate goal is to ensure a seamless supply chain process, with reliable insight into personnel, fleet, product and storage, as well as access to impeccable and accurate environmental control to ensure the highest quality. As the supply chain, cold storage and distribution industry moves into the future, and the market segments that rely on cold chain services become increasingly diverse and geographically spread, new technologies that strengthen every link will continue to emerge. With an economic potential of the global cold chain market alone predicted to reach $234.49 billion in 2020, stability is a necessity to achieving success—and ensuring the wellbeing of nine billion human beings.

 

Mike AllenMike Allen brings over 25 years of direct sales, sales management and channel management experience in the automated identification and data collection industry. He understands the technology and hardware capabilities and more importantly, how to address the pain points of various industries and vertical applications. He has experience in various industry sectors including transportation/logistics, automotive, oil and gas, utilities, manufacturing, warehousing/distribution, consumer goods and retail. Mike began his career in the Automated Information and Data Capture (AIDC) space managing key accounts and growing specific geographic territories for various manufacturers and providers of automated data capture equipment and solutions. Before joining Advantech, Mike worked with a provider of mobile device analytics to OEM’s and to managed services providers. Prior to that he worked with a global consulting and systems integration company where he was the lead for mobile data collection and strategy for major engagements globally.

Improving the Retail Supply Chain With Reusables

By Contributing Author | 08/08/2018 | 6:59 AM

By Ray Robins, national account manager, ORBIS

ORBIS blog
 

Are you tirelessly working to find a solution to optimize your retail supply chain? If so, you’re not alone. Retailers everywhere are searching for the best ways to serve consumers faster, safer and more cost-effectively. And as new solutions are considered, packaging shouldn’t be overlooked.

The rise of e-commerce and retail omnichannel is changing how retailers are approaching and thinking about consumer satisfaction. Fulfillment centers are now open 24/7, order demands are evolving with omnichannel, and errors and lag time are less tolerated. To help solve these challenges, supply chains are introducing automation.

In fact, many new fulfillment centers are almost completely automated to accommodate late hours, reduce errors, meet order quantity and introduce new capabilities. With added automation, supply chains need standardized packaging that delivers repeatable performance. For many retailers, this is the missing link to an efficient and effective retail supply chain.

Reusable, standardized packaging — such as totes, bulk containers and pallets — can work directly with automated systems in three key ways to better move and pick products:

1. Pick orders efficiently

Supply chain totes add unimaginable value to automated systems for their versatility and functionality. There are a wide range of reusable totes — attached lid, nest-only, stack-and-nest, and those that include dividers or feature hopper fronts — that align with different automated systems.

These reusable plastic totes are primarily used to pick online orders in fulfillment centers. Totes compatible with dividers, for example, are seeing an increase in usage. The use of dividers allows there to be multiple SKUs maintained in a single tote, increasing density within the network. 

Because each automated system is different, a one-size-fits-all approach is outdated. Totes should reflect the specific requirements of each system for a fully optimized supply chain. A supplier with custom capabilities can design, engineer and manufacturer reusable packaging that meets the precise needs of an automated system, including dimensions, materials and features.

2.Keep systems moving

As convenient as automated systems are, shutdowns are possible when met with unideal conditions. However, plastic reusable packaging features consistent dimensions and a smooth structure to fit properly with equipment, unlike warped and inconsistent packaging. It also is free from dust that can cause glitches and slowdowns once accumulated on equipment. Additionally, the sleek exterior allows automated label readers to easily decipher codes.

3. Minimize product loss

While moving along the supply chain, packaging can face harsh conditions. Clashes with other packaging and unpredicted equipment interactions are possible. Plastic reusable packaging is manufactured for more durable product protection, keeping goods safe. Also, some reusable plastic packaging suppliers offer identification options, so packaging can be tracked and accounted for at all times.

The good news is that reusable packaging’s benefits pertain to all parts of the supply chain. Picking, fulfilling, distributing and merchandising all require efficient processes. Like automation, mobile options can help move product faster and safer at retail. Innovative distribution pallets, for example, efficiently cube out in trucks, can be moved to the retail aisle without down-stacking — and with fewer touches — and help with omnichannel orders.

Retailers today are striving to be efficient and consumer-experience role models. Material handling decisions are important to achieving those goals throughout the retail supply chain, so don’t let packaging slow you down. Find the best solution for your automated system with a supplier that can help by answering questions and solving challenges along the way.

Is a Tightened Labor Market Driving Up Your Operational Costs? Consider Exploring Warehouse Incentive Programs to Increase Retention

By Contributing Author | 07/18/2018 | 6:02 AM

By Tom Stretar, Vice President and Labor Management Practice Leader, enVista

 

The speed of today’s supply chains, coupled with macro behaviors, are causing organizations to seriously consider incentive compensation as part of their overall associate compensation strategies. The Bureau of Labor Statistics recently reported that warehousing jobs experienced year-over-year uptick in the number of quits, making it one of the top industries having to cope and plan for unemployment. Just last year, there were 25,000 more quits in the industry itself [1], and some companies are even having to retrain 50 plus percent of their workforce to lessen the amount of quits.

We are seeing three key contributing issues to this trend.

Companies in large metropolitan cities are appearing in the lower percentiles of wage rates.

Bigger metropolitan areas and some of the tightest labor markets, such as Seattle, San Francisco and Minneapolis, are currently building in mandatory minimum wage increases to payroll, with amounts being adjusted based on employee headcount. These much-anticipated improvements in incomes are expected to take effect by 2022 and 2024.

By raising wages, cities are hoping to attract employees, because let’s face it, with an unemployment level that is the lowest it’s been in many years, it’s hard to motivate people to look for work other than presenting a decent number attached to the dollar sign.

The Amazon effect is causing a need for flexible workforces, including temporary and seasonal associates.

The Amazon effect is comprised of two parts. Yes, it offers employment opportunities, but at what cost? Amazon has long been known for its ability to attract employees from some of today’s largest and longest-standing retail operations.

As one of the few retailers that can afford to cut overhead costs, offer savings to customers, operate same day shipping all while decreasing profit margins, it’s a recipe for traditional retail disruption.  

Traditional retailers can’t afford to keep up with Amazon’s operations and what it’s able to pay and promise its employees in wages and growth potential. This is exactly what contributes to the key stakeholder’s decision to either cut hours and reduce payroll or even completely close the doors on brick-and-mortar and other online retail operations all together, giving into the “Amazon effect.”

Increase in omnichannel operations

Increased omni-channel capabilities mean increased complexity and activity. The window of order orchestration is getting shorter and shorter to meet customer expectations and provide the positive buying experiences customers expect. Combined with holiday shipping and continued e-commerce growth, the increase in need for labor programs will continue to be a strategic issue that logistics and human capital professionals will need to address as part of the recruitment, retention, and compensation programs of the future to compete.

In conclusion, whether you’re finding or retaining warehouse workers, the costs add up from departure costs, to additional advertising and recruiting and new training once onboard. Make it easier on your entire workforce and consider a warehouse incentive program. The programs have been proven to be a popular option for improving productivity and retention by as much at 15 to 30 percent, with labor expense ranging from 20 to 70 percent of a company’s operational costs [2], every company should avoid absorbing those costs by any means necessary.

 

Tom Stretar_headshotTom Stretar is Vice President and Labor Management Practice Leader at enVista, bringing more than 20 years of supply chain consulting experience in marketing, sales and implementation of complex supply chain improvement programs. Tom joined the enVista team in June 2009, following more than 16 years of service at JDA (formerly RedPrairie Corporation). During Tom’s career, he has personally developed or managed the delivery of more than 250 labor performance management programs across North America and Australia and is Green Belt certified in Lean Six Sigma. 

 

 

 

 

[1] Economic News Release: Job Openings and Labor Turnover, Bureau of Labor Statistics, DECEMBER 2017 https://www.bls.gov/news.release/jolts.nr0.htm

[2] Economic News Release: Employer Costs for Employee Compensation, Bureau of Labor Statistics, September 2017 https://www.bls.gov/news.release/ecec.nr0.htm

U.S. Infrastructure Needs the Tools of Logistics

By Contributing Author | 07/16/2018 | 6:30 AM

By Dr. John Brown Miller, past professor of civil engineering at MIT, chair of the ABA Section of Public Contract Law, and is an expert on infrastructure procurement.

 

In 1987, Hong Kong burst onto the world’s infrastructure stage with a series of 30-35 year build/operate (life cycle) projects for tunnels, rail, water, and ports. When Hong Kong rejoined China in 1997, much of the colony’s core assets had been rebuilt, with dramatic life cycle cost savings and higher levels of service. Procurement contracts put the risks of producing and operating these facilities on the private sector provider. For many projects in the program, Hong Kong also put revenue risk on the private sector provider (and its lenders and investors).[1] 

The results shattered American infrastructure dogma in three ways:

  • On-time, on-budget results are more likely when private sector capital is at risk;
  • Competitive life-cycle procurement attracts new technologies and methods that produce savings of 30-40%; and
  • Governments should avoid committing massive amounts of funds on large, complex projects without allowing the private sector to independently verify (through competition) that such projects make technical and economic (life-cycle) sense.

Hong Kong ran a Chinese bull through America’s infrastructure shop. The contrasts were stark. Here, publicly funded projects are routinely late and over budget—yet, only taxpayer dollars are at risk. Here, federal policy requires separate, full design before a separate competition for construction—while new technologies and methods are pushed away. In the United States, designers have no contractual obligation to the cost of operation—even though that’s when 90% of life-cycle costs are incurred. The result: Large, complex projects—like California’s High-Speed Rail—are not verified through competition in the private sector. Private sector teams do not independently verify that the large public projects make technical and/or economic sense.

Since Hong Kong’s success, the proper role of American government in public infrastructure is contested. The Life Cycle Cost Influence Curve below summarizes lessons learned from thirty (30) years’ experience with competitive life cycle delivery.[2]

First, early thinking about of Life Cycle Cost and long-term Levels of Service has a profound impact on outcomes. The blue line tracks Level of Influence on Life Cycle Cost over Time. Infrastructure owners have one opportunity, beforeDesign begins, to exert Very High Influenceat a Very Low Cost. The impact of this influence is shown as the difference (35% at the end of the cycle) between the red and green lines that compare High and Low Range Life Cycle Cost. Costs between the red and green lines are Avoidable. These funds need not be spent if the project is properly configured and controlled. Costs below the green line are Unavoidable – and will be spent once construction begins. Then, it is very hard to influence life cycle costs.

 

Dr. Miller chart1

Second, the quality of the Configuration process in the first few months determines the Life Cycle Cost Curve. Poor Configuration will produce Avoidable Costs that are three (3) times the total cost of initial Design and Construction. Pennies spent during Configuration, and nickels spent during design save dollars over the life cycle. There is always room for better design, better equipment, and high-quality materials, once life cycle performance is in view.

Third, the range of outcomes—between good and poor stewardship—is surprising. This is where the tools of Enterprise Risk Management[3](ERM)—“open system logistics”—are urgently needed to help public owners deliver high levels of infrastructure service at low life-cycle cost. In Hong Kong, teams used logistics to plan across the life cycle. Logistics can supply the tools necessary for Owners to use asset condition, as well as revenue and expense history, to properly configure projects. Public owners need new tools to be in position to perform the right activities, at the right time, in the right place, at a competitively verified price.

 

Dr. John Brown Miller HeadshotDr. John B. Miller is a global expert on infrastructure with an eye on efficiency and value. He has a thirty-five year focus on bringing practical business, legislative, and contractual solutions to the world’s burgeoning public infrastructure needs.

He was a reporter on the American Bar Association’s 2007 Model Code for Public Infrastructure Procurement project (MCPIP), which provides “best practices” in procurement to America’s 90,000 state and local governments. The Code is designed to help officials, vendors, and contractors ensure integrity in infrastructure delivery and finance, while helping taxpayers receive real value for money. The competitive principles in the Code have been adopted by many hundreds of state and local jurisdictions. He has consulted for the United Nations on best procurement practices.

Dr. Miller offers a practical combination of good procurement practices with enterprise risk management (ERM) to produce unique opportunities for massive gains in value for money. This combination creates the flexibility governments, vendors, and contractors need to get effective action, at the right time, in the right place, at the right cost – across entire public infrastructure networks.

Dr. Miller was professor of construction management and civil and environmental engineering at MIT, writing two textbooks in the field of infrastructure delivery and finance. He and his clients have been involved in some of the largest public infrastructure projects/networks in the world. He is an elected fellow of the American Bar Association, its Section of Public Contract Law, and the American College of Construction Lawyers, in which he has served in leadership positions. He is a prolific writer in this space, with more than 100 scholarly articles and case studies, and numerous invited presentations in every corner of the world.

 

[1]Hong Kong’s success renewed interest in much older project delivery and finance practices. My MIT textbook, Principles of Public and Private Infrastructure Delivery, covers America’s 200-year experience with life cycle delivery and the Hong Kong experience in Chapters 3 and 5, respectively.

[2]The Life Cycle Cost Influence Curve is based on our research program at MIT’s Civil Engineering Department between 1995 and 2003. The Curve extends the work of Prof. Boyd Paulsen (on design and construction) by adding Operations, Maintenance, and Repair – to cover the entire Life Cycle.

[3]By ERM, I mean the processes and logic of ISO 31000_2009(EN) Risk management – Principles and guidelines. Risk management includes the coordination of activities that direct and control the effect of uncertainty on complex collections of facilities, equipment, and supplies, involving ongoing operations, multiple people and firms, over long periods of time. ERM is “open-system” logistics (or supply chain management).

The Retail Revolution Starts with a Revolutionized Supply Chain

By Contributing Author | 07/13/2018 | 8:00 AM

By Guy Courtin, VP Industry & Solution Strategy, Infor Retail

 

The industry-wide integration of smart technologies has drastically altered e-commerce. No longer is the online shopping experience limited to Safari or Chrome platforms. Now, AI-enabled products such as Alexa and Siri allow the consumer to browse and purchase goods, hands free. Welcome to the age of voice commerce.

Recent announcements show that voice-driven technology will soon become commonplace in a myriad of industries. Wireless speaker company Sonos recently partnered with Amazon to insert Alexa’s AI capabilities into its product. Apple TV embedded voice commands, via Siri, into its latest remote control capabilities, allowing users to scan Netflix or Hulu’s massive libraries with a simple ask. And the latest versions of cars have included voice recognition capabilities to play, stop, or skip a song, call a friend, and even find a better traffic route. While the market may seem saturated with AI and machine learning-driven products, the trend is just beginning.

Machine learning technologies, and specifically voice-recognition capabilities, have the ability to revolutionize industries. So, how will they alter the retail supply chain?

  • Mastering the game of product placement: A recent article fromHarvard Business Review discusses how voice-commanded digital assistants will affect product marketing, as this smart tech will likely recommend products from its own brand. Go ahead, ask Alexa to order paper plates and disposable cutlery for that upcoming family reunion. Amazon-branded instead of generic products will most likely end up on your doorstep. Similar to when businesses listed their organization’s title with “AAA” to increase visibility in the yellow pages, companies now need to ensure their AI engines work with digital assistants to be top of mind for user orders. As these orders become more complex – moving from “please order me carpet cleaner” to “how do I remove stains from my rug?” – a more strategic AI engine should recognize the ask and still promote its product for purchases. The power of a good AI engine will prove vital in getting better placements, as the role of digital assistants increases in importance for consumer buying behavior.
  • A more intelligent supply chain: The ability of smart technology to connect the dots between a customer’s spoken, open-ended question and an order will jump start the supply chain in new ways. A constant difficulty for supply chain professionals is identifying the point of demand – and this will only get harder as customer questions become less pointed, focusing less on the words themselves and more on the intention behind them. Oftentimes, the easiest point of demand to recognize is the transaction, which can set off the supply chain process. But, AI engines can classify intention as demand, starting the process much earlier. When the consumer asks the above question about rug stains, the supply chain can get started on gathering the potential products he or she may order: stain remover, rug protector, maybe even a new rug! The more that consumers rely on these digital assistants for everyday tasks, the more data the technology can gather – data that can be used to predict future behaviors and identify purchasing patterns.
  • It is all about the context:An enhanced and smart AI engine is especially vital when retailers take into account the context in which consumers purchase their products. Items cannot have simple and bare-bones descriptions as to their ingredients, materials, etc.; the more thorough and detailed the description the AI engine has access to, the better for ensuring each product is matched correctly to the consumer’s needs and past purchases. Consider the previous example for a rug cleaner: has this customer ordered a rug cleaner in the past, and if so, was it an organic solution, or the cheapest product available? Does the consumer need a specific rug solution, which likely would be higher priced? Should they be buying a rug protector in tandem with the cleansing solution, as this is a repeat purchase? Companies must use smart, machine learning technology to engage with the information surrounding the customer’s ask, especially as this sort of contextualized understanding becomes the norm in connecting the consumer with the product.
  • With great information comes great responsibility: Of course, as much as gathering this data benefits the supply chain and the consumer, it also places greater responsibility on companies to guard it. This is exemplified by the fact that the customer subconsciously submits data to the digital assistant, typically within the privacy of their own home. Data issues have been a hot topic lately, as companies such as Equifax and Facebook deal with security breaches of the customer data they have collected. When companies are consistently gathering user data, they are creating an environment easily targeted by outside forces. Companies need to be strategic in how they manage this information, and balance gathering data to contextualize orders with ensuring confidentiality. Once retailers identify the line that cannot be crossed, being transparent with consumers about how information is being used will be key to creating brand loyalty and building trust in the company-customer relationship.

Voice commerce is a critical step for retailers, as they continue to reduce friction for e customers. This road has been traveled before – order online and pick up in store, two-day shipping, and one-click shopping have all proven successful in making life easier for the consumer while increasing brand loyalty. Voice commerce is the obvious next step in the modern retail revolution. But, as we continue to leverage existing and new technologies to improve the shopping experience, we must respect the great power that brands are beginning to harness and ensure that it produces only positive results.   

 

Guy CourtinGuy Courtin is Vice President of Industry & Solution Strategy for Infor Retail and Fashion, a role in which he also drives thought leadership for the team. Guy has more than 15 years of experience in the high-tech industry, with expertise in the supply chain arena. Prior to Infor, he was a vice president and principal analyst at Constellation Research, covering how digital disruption was impacting supply chains. Previously, Guy was vice president of research for SCM World, where he spearheaded coverage of supply chain service providers.

Five Trade Compliance Risks

By Contributing Author | 06/22/2018 | 12:39 PM

By Jeff Flanagan, Senior Solution Consultant, Precision Software

Obstacles are inherent when your business is involved in global trade. At or near the top of the list are international trade regulations, which are complex and dynamic, changing constantly as financial and political landscapes shift around the globe.

Compliance can be a heavy burden — sort of like hitching a few tons of iron ore onto every cross-border shipment your business makes. The worldwide tangle of laws, rules and guidelines is necessary for each country to protect its interests, but even accepting that regulations are inescapable doesn’t make logistics or supply chain management any easier.

With fines, sanctions and the loss of customers among the potential penalties for noncompliance, it’s beneficial to understand the risks associated with international shipping processes. Here are five key areas of risk to consider pertaining to global trade compliance.

1. Denied Party Lists

These are lists of companies, individuals or organizations that other parties cannot conduct business with, as determined by a U.S. agency or foreign government. Such lists exist because doing business with the denied party may be deemed a threat to national security, or the denied party may have a track record of corrupt business practices, etc. To reduce the risk of noncompliance in this area, check that your trading partners — potential and existing — are not on such lists. Be aware that these lists can change frequently, adding to the burden.

2. Documentation

Compliance in other areas can all be for naught if mistakes are made in what can be a voluminous amount of paperwork. Shipping documentation, export declarations and perhaps even product codes must meet the requirements of the country of your shipment’s destination. Being detained by customs won’t serve your bottom line or your reputation well, so do not ignore documentation details.

3. U.S. Authorities

There are certain conditions for which your shipment will be subject to U.S. trade law, regardless of your location. These include any transactions made in U.S. dollars, any transactions involving an individual from the U.S., and any businesses that bank in the U.S. Being in compliance in these circumstances means following U.S. regulations.

4. Hybrid Sanctions

In stark contrast to an outright ban against doing business in or with a specific country is determining whether you can conduct business with an entity in a country subject to hybrid sanctions. Some scope of certain commercial activities may be permitted, while others are not — making compliance a complex undertaking at best.

5. Supply Chains

If you have an international supply chain or customers, your global trading partners also must be in compliance with regulations in the countries where you do business. Their violations could result in penalties for your business even if your business isn’t fully responsible for the wrongdoing.

Compliance grows more challenging as global trading expands. Mitigating risk requires extensive research into worldwide regulations — which can tax your business’s resources — but having export controls in place to meet requirements is essential to avoid fines and penalties that ultimately would exact a higher toll on your business.

Automated international trade compliance software is an option that could save your business time and help you control costs. In part, this type of software uses available data to carry out functions such as screening for denied party list entities, checking documentation requirements for specific countries and other tasks.

 

Jeff Flanagan is Senior Solution Consultant for Precision Software, a trusted leader in global trade and transportation execution. He has been in the supply chain execution industry for 35 years in support, implementation, project management and sales consulting. 

Most ROI Calculators Are A Sham: 3 Red Flags To Look For

By Contributing Author | 06/20/2018 | 6:10 AM

By John Schriefer and Marjorie Loresch, Lucas Systems

Technology buyers should be skeptical of vendor ROI claims. The same goes for online ROI calculators that purport to show how a new solution can pay for itself in the time it takes to read this blog. Skepticism is warranted, but there is real value in tools that can help you realistically estimate how a given technology or solution can impact your operations and improve your financial results.

With that in mind, here are three red flags indicating that a vendor's "ROI calculator" is a sham.

1) Faulty Math

You'd be surprised how many ROI calculators out there equate percentage gains in productivity with percentage decreases in labor costs/requirements – for example, that a 15% increase in productivity results in a 15% reduction in labor costs. That’s just not correct.

Here's a simple way to check the math:

If you insert a 100% productivity gain into an accurate calculator, you should see a 50% decrease in labor costs (NOT a 100% decrease in labor). This makes sense, because essentially you're saying that your team will be able to do twice as much work in the same amount of time. If workers can do twice as much, you need half as many of them. It all adds up.

If you insert a 100% productivity gain into a faulty calculator, it may indicate that you will reduce 100% of your labor costs, which is obviously not right – you’re still going to need some people to pick products. Next, insert more than 100 for your productivity gain and your calculator will suggest that you will need negative labor hours (whatever that is!) to complete the same amount of work. Seems like a sweet deal, but it's literally too good to be true!

The error is less noticeable on smaller percentages, but it's still there, overstating the effect of productivity gains on your labor costs.

2) Overly Broad Savings Assumptions

Unfortunately, many ROI calculators suggest productivity or accuracy improvements without giving you a way to assess the range of benefits you would see in your operation. In some cases, they hard-code an expected outcome (e.g., future accuracy rate) into the calculator, assuming the result will be the same across all processes and operations.

In other cases, the calculator may give a wide range of possible improvement (e.g., 10-100% picking productivity gains) without providing context for what would cause you to fall on the high or low end of that range, or how exactly the technology will help you achieve those improvements.

A useful calculator will provide some guidance for you to estimate your improvements and allow you to adjust the input to the calculator to reflect your situation.

At the end of the day, a simple calculator will not be able to provide a detailed, operation-specific improvement estimate. That requires a much deeper dive into your process and current state. But some calculators do provide a good starting point for understanding where your gains will come from and how to make reasonable estimates of potential improvements.

3) Calculating ROI Without Cost

The definition of Return on Investment (ROI) is the amount of the return or net benefit of an investment relative to the investment cost. Although cost is a necessary input to a true ROI calculation, many vendors' "ROI calculators" don't mention cost at all.

It’s not uncommon for providers of complex technology solutions not to include solution costs on their website, so it’s not surprising that many so-called ROI calculators fail to include solution cost. But it’s simply misleading to call a calculator without cost inputs an ROI Calculator. Without cost, what you are really calculating is potential benefit or savings – assuming the math is right and you can adjust the inputs based on your circumstances.

A Final Word

Estimating benefits is a key step in making the case for any new technology investment, so tools that can help you do that have real value. Simple online savings calculators can get you started, especially if they illuminate specific ways a given solution or technology will impact your results. Armed with credible savings estimates, you can make a decision whether or not to move forward with a given solution or vendor.

But beware of vendor “ROI Calculators” that don’t really calculate ROI, use faulty math to project savings, or are based on unsupported savings assumptions. Vendors that make these obvious errors aren’t really helping you build a business case. And they are reinforcing the notion that buyers should take all vendors’ savings and ROI claims with a very large grain of salt.

Batteries with Thin Plate Pure Lead (TPPL) Technology Make Fast and Opportunity Charging Even More Cost-Effective

By Contributing Author | 06/18/2018 | 6:00 AM

By Harold Vanasse, Senior Director, Motive Power Marketing Americas, EnerSys

With more and more material handling operations switching to electric lift truck fleets, the adoption of fast charging and opportunity charging battery systems is growing. Industry consensus says that despite limitations like shorter battery life and weekly equalization requirements, fast and opportunity charging can help multi-shift operations save time and money.

However, industry consensus hasn’t kept up with advances in lead acid battery design. Batteries featuring Thin Plate Pure Lead (TPPL) technology are making fast and opportunity charging systems even moreefficient and cost-effective. To understand why, consider the differences between conventional charging, fast charging and opportunity charging:

Conventional Charging

Charging a lift truck battery overnight – including eight hours of charging and eight hours of rest – is known as conventional charging. Ideal for single-shift operations, conventional charging charges the battery at a 16-18% rate of charge over the first four to five hours, then tapers off until the battery reaches a 100% State of Charge (SOC).

When conventional charging is used in multi-shift facilities, it can be expensive and maintenance-intensive, as it requires one battery per shift, per vehicle, plus battery change-outs  and weekly equalization charges.

Fast Charging

As the name implies, fast charging is muchfaster than conventional charging – batteries can be charged in as little as two to four hours. To enable this speed, fast charging replenishes the battery at a 50% rate of charge the entire time. Unlike conventional charging, fast charging keeps the battery at a maximum of 85% SOC, but it still requires a weekly equalization charge to take the battery to 100%.

This option is best for three-shift operations, as it eliminates the need for extra batteries and battery swaps in between shifts, not to mention battery changing rooms. It does shorten conventional lead acid battery life, so new batteries will have to be purchased more often.

Opportunity Charging

Opportunity charging is just that – the ability to charge the battery during breaks, lunch, between shifts or whenever there is an opportunity. This method charges the battery at a 25% rate of charge and maxes out at an 85% SOC. As with conventional and fast charging, opportunity charging requires a weekly equalization charge.

Opportunity charging delivers many of the same benefits as fast charging, but it is best suited for two-shift operations in which the battery can make it through the second shift with short charges during lift truck downtime.

TPPL battery technology

Lead acid batteries with TPPL technology make the benefits of fast and opportunity charging even more beneficial. A TPPL battery can be charged at rates of up to 100%, with no risk of damage from overheating. The ability to fast charge at such a high rate can eliminate battery change-outs even for some three-shift operations. And unlike the shortened battery life that results from fast charging a conventional lead acid battery, a fast charged TPPL battery will actually last up to three years longer – with no watering requirements or weekly equalization charges. The result is a fast and opportunity charging solution that’s more reliable and cost-effective than ever.  

 

 

Harold Vanasse is Senior Director of Marketing, Motive Power Americas for EnerSys, the global leader in stored energy solutions for industrial applications. While serving in a variety of roles over the past 20+ years, Vanasse has been influential in bringing innovative solutions to the material handling industry.

Add Color to Make Your Warehouse Labels Stand Out and Be More Effective

By Contributing Author | 06/15/2018 | 6:00 AM

By Meegan Johnston, ID Label

It's no surprise to warehouse managers that barcode labels improve tracking, reduce errors, lower costs, aid in inventory management and boost worker productivity. But perhaps you haven't considered what role a label's design and color play in these outcomes.

In fact, in a warehouse environment, the use of color can play a significant role in a label's effectiveness.  

First, the right use of color makes a label stand out so it's easier for workers to see from a distance. In addition, an integrated system of colored barcode labels aids in improving processes for slotting, picking and overall inventory management.

ID Label 1

Colored Warehouse Labels and Multilevel Racking

The true benefits of colored barcode labels are most apparent in warehouses with large, multilevel rack systems.

For many ID Label customers, we design a uniform system of colored barcode labels to mark and identify tiers consistently throughout a warehouse or across a network of distribution centers. For instance, level 1 might be black, level 2 blue, level 3 green and so on.

This is highly effective when it's integrated into your WMS or inventory management software. It helps reduce put and pick errors and improves operational efficiencies.

This approach can be used on both horizontal and vertical warehouse labels.

Multicolor Production Capabilities

Today’s advanced digital inkjet presses can produce multicolor barcode images of astounding quality and durability.

ID Label’s presses feature integrated ultraviolet LED curing, laminating and die-cutting for printing high-quality, extremely durable, sequentially numbered and completely finished barcode labels in a single pass.

Bottom line: You don't have to operate a million-square-foot warehouse to reap the benefits of a colored labeling inventory system.

Meegan JohnstonMeegan Johnston is an ID Label business development manager.

A Closer Look at How Amazon’s Warehouse Wearables Will Change Data Capture

By Contributing Author | 06/13/2018 | 6:00 AM

By Don White, VP of Enterprise Solutions, Snapfulfil

Recently, supply chain tech experts have been abuzz with news that Amazon would change the way we measure warehouse performance. The eCommerce giant secured two patents for its warehouse wearables – armbands that track employee movement and direct the picking process sans barcodes.

Reactions to the concept were generally positive, even as some commentators suggested the new tech might face resistance from those who see it as an invasion of workers’ privacy. The pros for employees far outweigh the cons, however. More information about resource performance is always valuable in fine-tuning warehouse processes and inventory management, and these wearables could save employees time and effort as they move through the warehouse.

Here are a few ways Amazon’s wearables could help managers drive efficiency and conserve resources – and how they signal the future of warehouse operations:

A new (short)wave of technology

The technology required to manage the supply chain isn’t cheap – take, for instance, the more expensive internet speeds required to maintain smart warehouse equipment. Amazon’s wearables relieve some of this burden by remaining independent of Wi-Fi, leaving much needed bandwidth available. Instead, ultra-sonic and shortwave technologies drive the haptic feedback feature (the buzzing of a bracelet when close to the intended inventory item to be picked, for instance).

Don’t be in two places at once

Warehouse management technology can track item location and provide the data necessary for employees to reorganize inventory layout. Most solutions can only provide static product location, however, and fail to account for relative spatial tracking of slots, inventory and the labor resource’s hands – requiring significant monetary and resource investment that often gets overlooked.

Because Amazon’s wearables could track employees’ locations relative to each other and the items they’re picking, this technology could be the beginning of cutting-edge warehouse labor management. The possibilities are endless – from heat maps (associated with activity in a location over time) to comparative routing and de-conflicting associated with managing labor and locations and order fulfillment to disallow two resources from needing access to the same location at the same time, or in re-routing a person to avoid a forklift path.

Taking measurement to a granular level

WMS technology, until now, has focused on learned capabilities – how we can improve the speed at which staff moves through the aisles or efficiency during putaway processes.

With Amazon’s wearables, we’ll be able to measure something much deeper – intrinsic capabilities. Time and motion studies have been evaluating the impact of movement on efficiency for quite some time. Researchers will now have the discrete detail of observation

and measure that will lead to improved performance: ranges of acuity in hand/eye coordination and even dexterity can now be correlated to measures in individual performance.

Thinking about warehouse improvement sooner rather than later

Even though the possibilities for Amazon’s newest technology are endless, there are a few bugs to work out. Amazon has yet to disclose how soon their employees might wear this new technology – so it could be a few years before Amazon’s creation significantly impacts the supply chain.

While we’re waiting to see how Amazon’s next-level tech develops, warehouses can take steps now to prepare for increased demands on the supply chain. Warehouse management systems provide greater visibility into the numbers behind your most complex tasks – making it easier to adjust non-efficient processes.

Bottom line: There’s quite a bit to be excited about with Amazon’s latest innovation. But don’t forget – your operations demand efficiency now.

Don WhiteDon White has more than 15 years’ experience implementing and managing solutions for the supply chain. He currently serves as Vice President of Enterprise Solutions at Snapfulfil North America.

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 One-Off Sound-Off

Welcome to "One-Off Sound-Off," a blog page devoted to guest commentary on all things supply chain. This is a space where industry leaders can share their opinions and expertise with the logistics and supply chain community. If you have an article or commentary you'd like to share, please consider sending a guest blog proposal to feedback@dcvelocity.com.



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