Archives for May 2016

Why do we solve the same problems time after time?

By Steve Simmerman | 05/19/2016 | 9:40 AM

Some very exciting technology and supply chain news this week. I firmly believe that these innovative products and strategies are only the beginning of what we will see in the supply chain in the very near future.  Why not use this technology to help address the endless supply chain challenges that we have been addressing with traditional technology and approaches?  Driverless trucks?  Virtual digital assistants?  3D printing across the supply chain?  All awesome possibilities.  Here's a quick recap and I'd encourage you to read more about these news items.....

At the google I/O developers conference, they announced Google Home (think competitor to Amazon Echo).  Google Home is powered by Google Assistant a digital assistant. Google also introduced Allo a new messaging service.  They also announced Duo, a new digital chat service. Are the days of Allo and Duo assisted supply chain apps around the corner? I think the possibilities are endless and just take some thinking about things differently.  All of this is backed up by Google's bet on Artificial Intelligence (AI) and the notion that a virtual digital assistant is ever present and will help consumers (and why not business people) guide their day in real time.  Why do I have to go to my WMS to login, punch up some queries or dashboards when I can just use Allo.  And oh, by the way, if you don't like Allo why not try Alexa or Siri?  As I discussed with many people at the Annual WERC Conference, I believe we are on the cusp of some truly disruptive supply chain applications that will leverage these technologies.

Driverless trucks you say??  A bunch of google technologists and engineers have broken off to form Otto and are well on the way to delivering driverless trucks...sure there will be regulatory and safety issues, but the economics behind this innovation make a lot of sense...perhaps this is just the beginning to addressing the driver shortage and other costs tied to our massive transportation network.  As one article said, 'there used to be elevator operators in every elevator'...

  Otto Driverless Truck

Lastly, UPS announced that it's partnered with SAP to usher in the next century of the supply chain. Yes, it's early and still needs to be proven out, but it's a very innovative approach to disrupting the technology and using existing infrastructure to address real supply chain needs.

All great stuff and all just announced this week....the rate of innovation in supply chain is tremendous and the future looks very bright from my perspective.  I'm interested to hear how your organizations are looking at innovations like these and how they can be applied to your supply chain and overall business needs....let us know!

5% Unemployment = More Leverage for Temp Workers

By Steve Simmerman | 05/04/2016 | 4:03 PM

On the people front in supply chain, the pressures surrounding labor are continuing to mount. With California and New York already enacting $15/hour minimum wage laws and with unemployment hovering at 5% ("perfect employment" according to some economists), companies are starting to see much more pressure on wages and programs designed to attract and retain quality workers.

An article in USA Today talks about the pressure for higher wages, better benefits and even union organizing activities by temporary, part time workers. In speaking with customers around the country, it's not uncommon to hear turnover figures of 25%, 35%, and sometime much, much higher. In addition to that, I often hear about candidate hiring ratios of 6:1 or 8:1—that is only 1 out of 6, or one out of 8, temporary workers actually stay on as employees. The cost of recruiting, hiring, and training can be a huge drain, and these costs often are understated. In addition, productivity takes a huge hit when you consider all of the supervisory time spent on-boarding and training all these temps. The article concludes that many companies are starting to rethink their temporary-worker strategies in favor of going back to full time employees.

We've all heard the stories of a tight labor market, aging population, and more. As these pressures continue to build, we'll see if we reach a tipping point where the cost of having a more well-rounded full-time employee strategy outweighs the pain and costs of constant temporary-worker turnover, lower productivity, and all of the associated costs. Let us know what you see in your operation and in what direction you see the labor strategy heading.

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 Steve Simmerman

Steve Simmerman

Steve Simmerman is a Senior Director with JDA. Simmerman has more than 25 years of experience in the supply chain industry including software, consulting and material handling. He has focused his efforts on working with clients to achieve high performance supply chain results through partnerships and creative solutions. He is a member of CSCMP, WERC, and MHIA and is a regular contributor to several industry publications and events. Simmerman holds his undergraduate and MBA degrees from The University of Notre Dame.


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