Supply & Demand Chain Executive March 2015 by Supply+Demand Chain/Food Logistics

BONUS PULLOUT: Global Enabled Supply & Demand Chain Map, Version 29 March 2015

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Global Solutions for Supply Chain ROI

Shifting Gears:

The Road Ahead for Automakers p.38

Finding Opportunities in Reverse Logistics p.32

Visionaries Meet Pro to Know of the Year Keith Nash of Lennox Industries and the other creative supply chain professionals who get the job done Page 8

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Table of Contents March 2015

Volume 16

Issue 1

Inside

8 Cover Story

6 Executive Memo Triage for Container Ships

Shifting Gears: The Road Ahead for Automakers

West Coast ports have a lot of work ahead now that the strike is settled

A record year of recalls requires better supplier visibility, an efficient reverse supply chain and a commitment to quality

By Barry Hochfelder

26 Best Practice

The 15th Annual Pros to Know

Collaborate for ROI

Meet the visionary supply chain pros we’re proud to honor this year

By Anil Kodali

There are eight requirements for a successful supply chain collaboration implementation

28 Best Practice

By Editorial Staff, Supply & Demand Chain Executive

Bad Things Can Happen to a Good Company

Supply chain is in constant flux. It twists and turns, and evolves seemingly on a daily basis. To keep up with that movement takes thought, vision and action. End-users and consumers demand on-time service or they’ll go elsewhere. It takes an efficient supply chain to meet those demands. Each year, the staff of Supply & Demand Chain Executive sifts through hundreds of entries to find the best and brightest in supply chain: The Supply & Demand Chain Executive Pros to Know.

When it comes to managing third parties, you can never outsource the liability or the risk in your supply chain By Carrie Mantey

31 Best Practice Service as a Strategy Think service, think profit By Nitin Ahuja

32 Best Practice National Returns Day

Fortna Inc.

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Version 29

Following Page 26 Global Supply Chain Map 29.0

4 Supply & Demand Chain Executive March 2015

38 Industry Focus

34 Global Focus Reshoring and Total Cost of Ownership Positive trends at home bring back manufacturing jobs as the rush to offshore slows By Harry Moser and Millar Kelley

By Keri Dawson

41 Case Study Going Paperless Gain efficiency and save money with automation By Alyssa Kadansky

42 Best Practice Regional Parcel Carriers: The Right Choice for Your Business? There are pros, cons and questions to ask when considering this option By Paul Steiner

48 Industry Focus Getting a Handle on Global Transportation Spend Can Drive Growth Gain efficiency and save money with automation By Ajesh Kapoor

50 Professional Development Lessons from a Pin Factory What the Scottish Enlightenment can teach small to medium-sized companies about economies of scale By Amanda Menking

Special Green Award Advertorial Section

PITT OHIO............................. 44 Xerox.................................. 46

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1-800-765-7242 / www.saia.com

March 2015 • Volume 16 • Issue 1

executive memo

Triage for Container Ships West Coast ports have a lot of work ahead now that the strike is settled

ith the West Coast port strike finally settled, a lot of experienced logistics professionals will be put to the test. For inspiration, they can look to the guys who planned Operation Overlord, the D-Day invasion of June 6, 1944. By June 11, Operation Bolero—the logistics function of the invasion— included 326,547 troops, 54,186 vehicles and 104,428 tons of supplies on the five beaches of Normandy, most of it delivered by some of the 6,939 sea-going vessels involved. By the end of June, over 289,827 tons of supplies were offloaded for allied use. And all of that was done under the most hostile conditions imaginable. So while the task of handling the billion-dollar backlog of cargo at the 29 Pacific ports is daunting, at least the fate of the free world isn’t hanging in the balance. I’m not trying to diminish what’s going on here. It’s important to the world’s economy, even to its health as pharmaceuticals and medical devices pile up on docks. Gene Seroka, executive director of the Port of Los Angeles, was quoted as saying it will be around three months “to return to a sense of normalcy.” The Wall Street Journal cited some industry analysts as saying it could take two to six months to get the U.S. supply chain back on track. Meanwhile, dozens and dozens of ships with thousands and thousands of containers are lining up. According to the Associated Press, the ships waiting for dock space in Los Angeles and

Barry Hochfelder

Editor Supply & Demand Chain Executive

barry.hochfelder@sdcexec.com 6 Supply & Demand Chain Executive March 2015

Long Beach alone would stretch for 579 miles. There are smaller, but still significant, backups in San Francisco, Puget Sound, Oakland and others. The logistics pros on the job will have to prioritize products, especially perishables such as produce and pharmaceuticals—kind of a triage for container ships. As I said before, it’s daunting. But I’m confident they can pull it off. When you read our annual Pros to Know feature that begins on Page 8, you’ll see the word logistics pop up quite often, but we all know there’s a lot more to supply chain. Take a look at the diverse careers of our Pro to Know of the Year, Keith Nash, vice president supply chain logistics at Lennox Industries, and the three runners-up: Celeste Aarons-Jenkins, vice president of demand planning, Tiffany’s & Co., David Medlin, senior director of distribution systems, Target Corp., and John P. Willi, vice president of corporate supply chain management, NYU Langone Medical Center. They’re in four different verticals with different—and demanding—customer bases, yet all with pain points that take innovation and creativity to solve. How they and the more than 200 other supply chain professionals we honor in this issue do it is worth noting, sharing and learning from. Please don’t neglect the other informative articles in the magazine. You never know when the light bulb will go on and you’ll say, “Hey, that’ll work for us!” It may be supply chain collaboration, third-party logistics, reverse logistics, reshoring, the automotive supply chain, warehouse automation or a guide to using regional carriers. It’s all here and more. Enjoy. ■

Global Solutions for Supply Chain ROI

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Print and Digital Staff Publisher Jolene Gulley Editor Barry Hochfelder Associate Editor Carrie Mantey Assistant Editor Eric Sacharski Art Director Kayla Brown Ad Production Manager Cindy Rusch Sr. Audience Development Manager Wendy Chady Audience Development Manager Tammy Steller Advertising Sales (800) 538-5544 Jolene Gulley, jgulley@ACBusinessMedia.com Stephanie Papp, spapp@ACBusinessMedia.com Editorial Advisory Board Lora Cecere, Founder and CEO, Supply Chain Insights Tim Feemster, President, Foremost Quality Logistics John M. Hill, Board of Governors, Material Handing Industry of America William L. Michels, CEO, Aripart Consulting Julie Murphree, Founding Editor, Supply & Demand Chain Executive Andrew K. Reese, Former Editor, Supply & Demand Chain Executive Bob Rudzki, President, Greybeard Advisors Raj Sharma, CEO, Censeo Consulting Group Kate Vitasek, Founder, Supply Chain Visions Circulation & Subscriptions P.O. Box 3605, Northbrook, IL 60065-3605 (877) 201-3915, Fax: (800) 543-5055 Email: circ.sdcexec@omeda.com List Rental Elizabeth Jackson, Merit Direct LLC (847) 492-1350, ext. 18, Fax: (847) 492-0085 Email: ejackson@meritdirect.com Reprint Services Nick Iademarco, Wright’s Media (877) 652-5295, ext. 102 niademarco@wrightsmedia.com AC Business Media Inc. Chairman Anil Narang President and CEO Carl Wistreich Executive Vice President Kris Flitcroft CFO JoAnn Breuchel VP Content Greg Udelhofen VP Marketing Debbie George Digital Operations Manager Nick Raether Digital Sales Manager Monique Terrazas Published and copyrighted 2015 by AC Business Media Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher. Supply & Demand Chain Executive [USPS #024-012 and ISSN 1548-3142 (print) and ISSN 1948-5654 (online)] is published five times a year: March, May, June, September and December by AC Business Media Inc., 201 N. Main Street, Fort Atkinson, WI 53538. Periodicals postage paid at Fort Atkinson, Wisconsin and additional entry offices. POSTMASTER: Please send all changes of address to Supply & Demand Chain Executive, P.O. Box 3605, Northbrook, IL 60065-3605. Printed in the USA. SUBSCRIPTION POLICY: Individual subscriptions are available without charge in the United States, Canada and Mexico to qualified individuals. Publisher reserves right to reject nonqualified subscribers. Oneyear subscription to nonqualified individuals: U.S., $30; Canada and Mexico, $50; and $75 for all other countries (payable in U.S. funds, drawn from U.S. bank). Single copies available (prepaid only) for $10 each. Return undeliverable Canadian addresses to: Supply & Demand Chain Executive, P.O. Box 25542, London, ON N6C 6B2. The information presented in this edition of Supply & Demand Chain Executive is believed to be accurate. The publisher cannot assume responsibility for the validity of claims or p erformances of items appearing in editorial presentations or advertisements in the publication.

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2015 Pros To Know

Supply Chain Visionaries By Editorial Staff, Supply & Demand Chain Executive

Led by Pro to Know of the Year Keith Nash, these men and women have what it takes to get the job done

upply chain is in constant flux. It twists and turns, and evolves seemingly on a daily basis. To keep up with that movement takes thought, vision and action. End-users and consumers demand on-time service or they’ll go elsewhere. It takes an efficient supply chain to meet those demands. Each year, the staff of Supply & Demand Chain Executive sifts through hundreds of entries to find the best and brightest in supply chain: The Supply & Demand Chain Executive Pros to Know. Once those executives are selected, the job gets even tougher as we must anoint our Pro to Know of the Year. The committee first narrowed the field to four exceptional supply chain practitioners, then, at last, we named our winner: Keith Nash, Vice President of Supply Chain Logistics for Lennox Residential Heating and Cooling. The worthy finalists are Celeste Aarons-Jenkins, Vice President, Demand Planning, Tiffany’s & Co., David Medlin, Senior Director, Distribution Systems, Target Corp., and John P. Willi, Vice President, Corporate Supply Chain Management, NYU Langone Medical Center. Lennox Industries provides climate control products for residential and commercial heating, ventilation,

8 Supply & Demand Chain Executive March 2015

Pro to Know of the Year Keith Nash watches HVAC units move around a Lennox warehouse. (Photo courtesy of Lennox Industries)

air conditioning (HVAC) and refrigeration markets around the world. The company’s customers are dealers who work directly with the end-user consumers and install units in their homes. These dealers want to be able to visit their clients’ homes after typical nine-to-five work hours and still guarantee next-day installation. “Lennox is seeing more orders placed later in the day with the same expectation for next-day delivery,” Nash says. “Order cut-off times, which used to be around 3

p.m., now are received as late as 10 p.m. and deliveries are scheduled for as early as 6 a.m. the next morning.” Meeting these decreasing cycle times and increased service levels at a lower cost and working capital is the biggest supply chain challenge that Lennox currently faces. One solution that Nash and his team developed was moving from a national stocking design based on two large warehouses and 65 stores to a hub-and-spoke network with eight regional distribution centers, 20 local

2015 Pros To Know

distribution centers and 160 stores (with plans to reach 215) of which 51 are shipping locations. Lennox used Manhattan Associates’ Warehouse Management System (WMS) and Transportation Management System (TMS) to manage the added complexity that came from that move, which necessitated going from one shipping location to 51, as well as fielding inbound orders from more than 160 internal locations and more than 7,000 external delivery locations. The WMS and TMS software manages that complexity seamlessly, replacing the need for an additional 200 plus workers. Under Nash’s Supply Chain Leadership Management team— Gary Bedard, Corey Larsen, Tim Wismer, Rich Wroclawski, Mark Johnson, Ross Angell, John Ernat, Kathryn Manders, Keith Barnes, John Beckett, Karen Schuller, Von Reynolds and Laura Dahlberg—the move to this hub-and-spoke network enabled Lennox to be geographically closer to its customers, which helps the company cater to shorter order cycles. After implementing Manhattan’s WMS, Lennox saw warehouse productivity increase by 24.5 percent. Logistics as a percent of sales decreased 19.6 percent. Lennox also re-implemented SAP demand planning and forecast software, which helped the company boost on-time delivery rates from below 80 percent to almost 95 percent. In the year to come, Nash and his team will be working with Manhattan Associates to implement customer self-service options as well, which will facilitate order placement and tracking, and be available on mobile devices. Selfservice options will put more power and control in the hands of Lennox’s customers and will streamline processes.

Under Nash’s leadership, Lennox also began investing heavily in employee education, requiring 40 hours of training for non-managers and 60 hours of training for managers. Courses focus on general management and supply chain education. Internal education funding didn’t exist before Nash joined Lennox in 2010, but since then, he helped carve out a six-figure employee education budget. This program is integral in preparing employees to execute the safest, most effective supply chain operations possible, as well as better meet the demands and tight timeframes of their customers. Nash also says he shares this honor with Lennox’s Supply Chain Distribution Operations Leadership Team: Bud Price, Tom Wainwright, Clif Turner, Mike Gleason and Derek Barnhill. Our three finalists also made a difference for their companies. An iconic brand, Tiffany’s & Co., wants to expand its global presence. Celeste Aarons-Jenkins and the Demand Planning team is charged with balancing support for marketing campaigns, Pro to Know of the new product Year Finalist Celeste launches and Aarons-Jenkins strategic corporate initiatives, while accelerating inventory turns and improving service levels. One of the key programs the Demand Planning team initiated this past year was to review the forecasting process to improve accuracy and product availability. Taking a step back, Aarons-Jenkins and her team identified two key areas for improvement: understanding bias and the impact of new product

launches. Reviewing historical data, the team recognized that bias influenced prior forecasts, which led to excess inventory. Additionally, the team identified an opportunity for improvement around new product launches. Traditionally, a demand plan for new product would include only a small amount of cannibalization of other collections. To increase success, the demand planning team created a holistic forecast that now accounts for several variables, including the impact of new product launches on (or in combination with) other business segments. Stakeholders from marketing, design and product development, assortment planning, supply planning, internal manufacturing, the gemstone/diamond division and creative visual merchandising are all involved in the planning process. This collaborative effort will continue to be enhanced as the company moves toward a more formal integrated business planning process. Tiffany’s & Co.’s demand planning team relies on Logility Voyager Solutions to drive its demand forecast, which is translated into its purchase, inventory and replenishment allocation plans. In addition, the team was able to focus on more strategic initiatives to drive additional supply chain opportunities. David Medlin of Target asks, “How should a company balance product, experience, value, personalization, etc.? We know Pro to Know of the Year Finalist our guests expect David Medlin great design and quality products from us, but they also demand great value. But we know that we can’t be all things March 2015 Supply & Demand Chain Executive 9

2015 Pros To Know to all consumers, so we have to prioritize and are focusing our efforts in key categories where we know we can excel and differentiate ourselves. These decisions have huge supply chain ramifications as we think about balancing the capacity cost to carry and ship inventory with the need to fill guest demand as quickly as possible. This requires a thoughtful blend of supply chain insight and supply chain execution.” To provide the customer with a seamless experience means unlocking new fulfillment options in the supply chain, such as pickup in store or ship from store, allowing Target to leverage existing assets in new ways that provide value and enhance guest experience. “We are currently seeing over 10 percent of our digital transactions being picked up in stores and the best part is that nearly a quarter of those guests who come to pick up increase their basket size once

they are in the store. Win, win!” John P. Willi is responsible for $2 billion of spend at New York University Hospitals Center & Medical School. The Supply Chain Management Pro to Know of (SCM) Team the Year Finalist uses value-based John P. Willi management techniques, including gateway pricing, with a total-cost-ofownership focus with strategic suppliers to achieve $3.5 million in annual savings in the orthopedics, CRM and neurosurgery spend area. The SCM Team considers its strategic suppliers as true business partners and integrates product road mapping sessions to drive enterprise-wide solutions. This SCM collaborative style yielded over $19 million in additional annual savings that resulted in an increase in bottom line

contribution margin of 3 percent. To accomplish this, Willi says, the healthcare industry must adopt world-class practices from out of industry. Predictive analytics, and sales and operations planning must be integrated into patient care along with demand planning. “That means an integrated approach with our supply chain is critical in the design and production of improved healthcare. Transparency and trust must be built between practitioners and suppliers in order to optimize results,” Willi says. “Supply chain strategy and corporate strategy are very much aligned. Supply chain leadership must have a seat at the table in the C-suite to convey the value proposition. If your supply chain is not aligned with your corporate mission, you will be set up for failure. You must be focused on one mission and execute on it.” And now, let’s pay tribute to all of our 2015 Pros to Know. ■

2015 PROVIDER PROS TO KNOW Stephanie J. Miles, Senior VP of Commerical Services, Amber Road Miles has a deep understanding of industry best practices and potential risk areas. She also led the formation of best practices for data management through customer forums and industry discussions. She helps customers understand how to best manage a sea of diverse data.

Nathan Pieri, Chief Product Officer, Amber Road His broad set of experience in enterprise software, manufacturing operations, product engineering, trade content and supply chain analysis gives Pieri a deep 10 Supply & Demand Chain Executive March 2015

understanding of the needs of the customer, and how technology can help improve the management and operations of complex global supply chains.

James Marland, VP of Network Growth, Ariba, an SAP Company The supply chain can be a catalyst in a broader “get connected” strategy, according to Marland. “As supply chain proves out the benefits of collaboration with suppliers, the same kind of networks can be used by treasury to manage cash or transmit payments, or by sales to find new customers and increase wallet share from existing customers.”

Gene Averill, President and CEO, Avercast Averill believes web-based forecasting, planning and collaboration tools are crucial in transcending language barriers, time zones and culturespecific challenges. Sharing supply chain data across the end-to-end supply chain allows every trading partner to shorten lead times, and improve customer service levels, inventory turns and the overall bottom line.

Joe Averill, CIO, Avercast One of today’s largest challenges, he says, is harnessing big data for supply chain optimization, particularly point of sale (POS) data. Averill developed

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2015 Pros To Know the capability to load and process hundreds of millions of POS records into a single SQL database and perform analysis in seconds to minutes as opposed to previous industry standards.

Martin Jack, CTO, Barcoding, Inc. For a large equipment rental company, Jack and his team brought together the various vendors that provide different technologies— global positioning systems (GPS), handheld computers, route accounting software, etc.—to create a single integrated solution. The customer experienced more efficient fleet management, improved customer service, minimized verbal communications, increased driver safety, optimized routes and more.

12 Supply & Demand Chain Executive March 2015

Esa Tihila, CEO, Basware Under Tihila’s direction, Basware recently established Basware Financing Services, which delivers new and innovative financing services for buyers and suppliers, combining payment with financing services. These solutions can help businesses automate their financial processes, manage their cash positions more intelligently, build stronger relationships across their supply chains, and ensure they can pay and be paid quickly and efficiently.

Dawn Anderson, Planning Process Manager, Baxter Planning Systems Improving service levels while simultaneously reducing or maintaining inventory cost is the primary challenge in managing

a supply chain. To achieve this, Anderson implements best practices for evaluating analytics that assess the root cause of each service miss in the supply chain. These metrics were instrumental in facilitating the continuous improvement required to maintain high service levels while controlling inventory cost.

Chris Heywood, Lead Planner, Baxter Planning Systems Heywood says that, by understanding the requirements of the service supply chain, companies can implement the tools and processes needed to ensure that parts are available on today’s aggressive service level agreements. This must be done while controlling the total cost of inventory and mitigating the creation of excess or obsolete inventory.

2015 Pros To Know

Lisa Primrose, Director of Client Services, Baxter Planning Systems By working with a large automotive manufacturer to create and align the organization around a common set of metrics, Primrose’s direction around the adoption of best practices enabled the company to achieve a 20 percent improvement in service level while keeping inventory days of supply steady.

Rod Daugherty, VP of Product Strategy, Blue Ridge Daugherty believes supply chain planning and execution must be central to a company’s overall strategy. If done strategically, the broad

14 Supply & Demand Chain Executive March 2015

spectrum of supply chain positively affects both the top and bottom line, starting with the proper forecast and profitable inventory plan through the efficient and cost-saving execution of transportation and inventory distribution.

John Moffitt, VP of Services, Blue Ridge Working with retailers and the Blue Ridge solution set, Moffitt is helping develop and implement solutions that can improve the flexibility of supply chains, and properly forecast where demand is generated and by which customers in order to be sure inventory is deployed in the most effective way.

Greg White, CEO, Blue Ridge To reap the full benefit of supply chain optimization initiatives, White says, companies should involve more than just logistics and supply chain. By understanding consumer activity, analytics create actionable intelligence that can affect the decisionmaking of finance teams, category managers, sales and marketing leaders and, especially, the executive suite. Sharing these insights drives significant results to the bottom line.

Colby Beland, VP of Sales and Marketing, CaseStack Beland was responsible for assembling a team of business development executives who, for the last three years, produced a year-over-year growth of more than 26 percent. They expect to achieve similar or higher results in 2015. Beland gives all the credit to his team and its ability to continually create valuable supply chain solutions for CaseStack’s customers.

Erwin Hermans, VP of Supply Chain Managed Services, Celestica Hermans brought to market a complete managed services business model that delivers the tools to create predictability, reliability, execution and responsiveness across the entire supply chain.

Bill Harrison, President, Demand Solutions Rather than simply focusing on the knowledge and data of your own company, Harrison advises, you can add external input and visibility into all your planning processes. You can help your network react more quickly by sharing data from your customers with supply chain partners.

Ann Drake, CEO, DSC Logistics Under her leadership, the culture of DSC encourages critical thinking and innovation; values creativity, courage and collaboration; promotes leadership among employees of all levels; and provides senior leaders with challenges and opportunities to build and utilize key strengths. She says, “the world is discovering the supply chain—and discovering the value of partnerships and collaboration.”

Jim Monkmeyer, VP of Supply Chain, England Logistics Monkmeyer’s ability to recognize needs and provide viable solutions can be seen in his accomplishments, such as designing and implementing new shipping strategies to reduce cost and improve services at 15 sites at Rockwell International Corp., or managing and redesigning logistics networks of several Fortune 100 manufacturers.

Doug Kahl, VP of Transportation Solutions and Freight Management Sales, enVista Kahl was an integral part of enVista’s recent global expansion. Supply chain success, according to Kahl, is based on the relentless execution of multiple projects, across various divisions or departments, in an orchestrated

manner that is clearly communicated throughout the organization.

Mike Rader, Partner, Supply Chain Solutions Practice, enVista He recently led a multi-channel retailer through its design of a new facility, facility relocation and implementation of a new WMS with new process improvements designed. This created higher inventory visibility and accuracy, increased throughput and order turn, while realizing a 30 to 50 percent growth.

John Stitz, Senior Managing Partner, co-founder, enVista Under Stitz’s leadership, enVista provides services that range from transportation to warehousing to enterprise solutions for manufacturers, distributors and retailers, including Tory Burch, Vera

Bradley, PepsiCo and Nestle Purina. Through his expertise and leadership, Stitz helps clients collectively save millions of dollars in annual transportation savings.

Donna Troy, Executive VP and General Manger, ERP Americas, Epicor Software In leading Epicor’s growing SCM presence in the Americas, Troy’s focus is on strengthening customer and partner relationships for both enterprise and small to medium-size business segments. Leveraging her global experience, Troy is also focusing on expanding the company’s presence and growth in Latin America.

Jeff Sovelove, Director of Implementation, eZCom Software Sovelove says that, to be successful in today’s retail market, supply

When you’re driven by details, the world is a smaller place. Old Dominion simplifies global shipping by doing more than delivering freight. Our focus on premium service means every shipment arrives with one of the lowest claims ratios and one of the best on-time records in the industry. OD Global offers: • Personalized, single point of contact for status on all shipments • Paciﬁc Promise™: service from 24 Asian ports direct to the U.S. • Direct service to or from Canada, Mexico, Puerto Rico, Alaska and Hawaii

For more information, visit odfl.com or call 1-800-432-6335. Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identified herein are the intellectual property of their respective owners. © 2015 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

March 2015 Supply & Demand Chain Executive 15

2015 Pros To Know chain must align with retailers’ ever-increasing focus on omnichannel strategies. He oversees the setup process for all eZCom customers, interfaces with retailers and customers, and directs the development of all new retailer maps, working closely with the eZCom development team.

Marc Austin, Managing Director, EMEA, Fortna Current supply chain challenges include the rise of multi-channel commerce, competing with e-commerce-only companies, and a move to next-day and same-day fulfillment. Austin works with highgrowth companies that need additional distribution capacity, helping them develop and implement strategies

so they can continue to meet their customers’ expectations for quick fulfillment.

capability to connect and collaborate with all of their trading partners in a single social hub.

Russell D. Meller, VP of R&D, Fortna

Tom Beaty, Founder and CEO, Insight Sourcing Group

Meller is a multi-faceted distribution expert with a blend of academic and applied experience from more than 20 years. Specializing in facility logistics with a focus on distribution center design and facility layout, he also has experience in material handling system design, network design, logistics and automated material handling.

Beaty provides his clients with speed to results and deep expertise, which enable them to meet sometimes unrealistic goals, but also save jobs as the companies are able to reduce costs in the procurement of goods and services as opposed to head count reduction.

John A. White III, President, Fortna “Efforts to improve and/or enable supply chain capabilities should be based on a strong business case that provides justification for investment, but also demonstrates that it is aligned with the company’s broader strategy,” White advises. “For example, what is the supply chain doing to help increase revenue, improve service, engage customers/ consumers and provide visibility?”

Sean Feeney, CEO, GT Nexus Feeney’s perspectives are resonating with the analyst community, which is embracing his view that the future is a hyperconnected world in which businesses must have the 16 Supply & Demand Chain Executive March 2015

Brett H. Eiland, Executive VP, Insight Sourcing Group Eiland has an outstanding and consistent track record of partnering with his clients to help solve difficult problems and develop solutions that have a meaningful impact. He works across a variety of industries, including manufacturing, financial services, retail, healthcare and private equity.

Jacob Wojcik, Senior VP, Insight Sourcing Group He developed working relationships with more than 30 private equity firms to foster the role of procurement within their portfolio companies, and is now considered an expert in the application of strategic sourcing and procurement strategies in that environment.

Brian Miller, VP of Services, Intesource Miller leads a team of e-sourcing experts that advise many of North America’s top brands, including Wegmans, Family Dollar, Rite Aid and SpartanNash. Over the past 15 years, he helped Intesource build a base of more than 25,000 trusted suppliers.

Padman Ramankutty, Founder and CEO, Intrigo Systems

Chris Jones, VP of Consulting Services, Junction Solutions

Ramankutty leads the provider of hands-on advisory, implementation and managed services in supply chain. Under his leadership, Intrigo partnered with SAP in the design of its Advance Planning & Optimization (APO) environment in very large implementations.

Jones recently completed a multimillion dollar, two-year CRM project for a leading aviation manufacturer that operated multiple global service centers with disparate CRM systems. His team implemented a central quote-and-order management system based on an enterprise CRM system integrated with the company’s ERP system. The result was higher sales and strong growth.

Ryan Sheehan, CEO, Invata Intralogistics With a background in finance, organizational development and program management, Sheehan’s skill set was built in the design, operations and project engineering side of the business. Capitalizing on his project management and customer support experience, he tries to maintain a focus on meeting client needs.

James V. Kelly, CEO, JVKellyGroup Kelly says, “When designing a dashboard for C-level review, it must be aligned with corporate goals, possibly down to earnings per share. This means the C-level view will be supported by the operations view,

but will translate the operations view into the strategic direction. Too many analysts will provide what they think is required rather than understanding what a CEO/CFO needs.”

Rob Barrett, Managing Director, KPMG Barrett delivered a global demand and spend consolidation solution as part of a $1 billion global cost-saving effort to integrate more than 50 group companies into one operating company. The solution consolidated global operations, enabling a $100 million-plus reduction in operating expense and a 30 percent reduction in inventory, while improving customer service levels with a 70 percent drop in stock-outs.

We’re on time when time is scarce. When you need something shipped immediately, Old Dominion Expedited delivers. Our focus on premium service means every shipment arrives with one of the lowest claims ratios and one of the best on-time records in the industry. OD Expedited offers: • Next-day arrival • Delivery at a guaranteed time • Weekend Promise: guaranteed Friday to Monday delivery

For more information, visit odfl.com or call 1-866-637-7333. Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identified herein are the intellectual property of their respective owners. © 2015 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

March 2015 Supply & Demand Chain Executive 17

2015 Pros To Know

Mike Edenfield, President and CEO, Logility Edenfield leads Logility’s continued investment in R&D to drive innovation and deliver new supply chain capabilities to help customers reduce costs, improve product availability, increase visibility and seize future opportunities. His focus is on delivering solutions customers need to succeed, be competitive and stay ahead of the ever-changing market conditions.

Daniel Clarahan, Solutions Consultant, NeoGrid One of Clarahan’s global OTC clients, had a wealth of information that wasn’t being utilized or shared.

The logistics team was not being consulted in the S&OP process. Clarahan brought logistics and other supply chain management areas into the fold to improve communications. This collaboration resulted in major increases in efficiency and savings.

Michael Williams, Senior Solutions Consultant, NeoGrid Williams implements several different solutions that allow clients to gain the real-time visibility they need to confidently make critical decisions. Ranging from strategic promotions management to store-level inventory management, these solutions provide visibility and add value, all while leveraging the cost benefits of cloudbased architecture.

Aman Mann, CEO and Co-Founder, Procurify Under his leadership, Procurify focused on commercializing its simple cloud e-procurement solution and gained users in more than 50 countries. Procurify is meeting the needs of a constantly growing client base with a user-designed solution focused on bringing back simplicity to the workplace.

18 Supply & Demand Chain Executive March 2015

Pam Lopker, President and Chairman of the Board, QAD Lopker spearheaded an initiative to include quality management applications in QAD’s solution, including supplier performance metrics and a full corrective and preventive action (CAPA) system. Her vision led to the inclusion of rarely available supply chain capabilities such as logistics accounting for including full landed costs of components.

Sanish Mondkar, Executive VP and CTO, Procurement and Business Networks, SAP Mondkar leads a team that is enabling chief procurement officers to effectively become chief collaboration officers by delivering technology innovations that empower them to organize resources and optimize collaboration within the enterprise and across the supply chain to achieve new levels of innovation, efficiency and agility.

Dan Swartwood, VP of Process and Technology, Satellite Logistics Group Swartwood leverages the SCOR model, along with Lean and Six Sigma to help companies increase efficiency and improve customer service levels. Defining supply chains and fine-tuning strategy for eight of its supply chains, he helped one company to identify $13 million in savings opportunities—3 percent of revenue.

Joe Humm, VP of Global Sales Operations, Sparta Systems Humm and his team find that organizations with enterprise-wide quality process solutions in place are driving operational efficiencies across the supply chain. This is measured by fewer quality-related records lying dormant, quality records being managed more efficiently and fewer records being recorded, which, based on the qualitative analysis, means issues are solved at their root.

Tom Mann, President, TrakLok International Cargo theft can cause a major disruption in a company’s supply chain. Mann made cargo security his passion and, as such, developed a solution for cargo theft that is unrivaled in the current marketplace.

For one client, a trucking company, Mann’s solution eliminated $400,000 in theft losses per year.

Troy Ryley, Managing Director, Mexico, Transplace With extensive knowledge in logistics and best practices in the region, Ryley is an integral part of many large corporations’ entry into Mexico. His knowledge and experience south of the border spans the pre-NAFTA period through the implementation of the free-trade agreement.

Eric Lail, VP of Client Services and Continuous Improvement, Transportation Insight An optimized supply chain is a competitive advantage, Lail says. “Once the barriers are removed, a

business can serve its customers with optimal efficiency and grow through its supply chain. With an optimized supply chain, companies can expand their product line, customer base or service areas without having to worry about the associated logistics complexities.”

Scott Nelson, CEO, Trax Technologies Nelson led the creation of a continuous assurance process that identifies, monitors and corrects bad data at the source—before it corrupts downstream audit, expense posting and supply chain performance analytics. He understands that cleaner data is the key to solving the logistics industry’s trillion-dollar problem.

We make a big deal over the tiniest items. Old Dominion’s focus on premium service means every item arrives with one of the lowest claims ratios and one of the best on-time records in the industry. OD Domestic offers: • More than 225 service centers nationwide • Competitive transit times and pricing • Proactive shipping solutions

For more information, visit odfl.com or call 1-800-235-5569. Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identified herein are the intellectual property of their respective owners. © 2015 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

March 2015 Supply & Demand Chain Executive 19

2015 Pros To Know

2015 PRACTIONER PROS TO KNOW

Kevin Hoyle, CEO, B2BGateway.Net Hoyle says key challenges include keeping abreast of the smart economy and the Internet of Things (IoT)—how smart machinery and devices enter the supply chain—and the need to keep costs under control, forming beneficial partnerships with other supply chain application providers to offer customers a complete all-in-one solution.

Steve Schuman, Chief Procurement Officer, dg3

Baxter Planning Systems proudly recognizes its

THREE 2015 Pros to Know, acknowledged for their exceptional service and dedication to our company and clients. DAWN ANDERSON, Planning Manager 10 year Baxter veteran

LISA PRIMROSE, Director Client Services 4 year Baxter veteran

CHRIS HEYWOOD, Lead Planner 3 year Baxter veteran

Baxter’s solutions will forecast demand, optimize target stock levels and integrate with other systems to execute supply, replenishment and repair orders for each part in your service supply chain. Visit our website at www.bybaxter.com to learn how Dawn, Lisa, and Chris have helped our clients, from growing startups to Fortune 500 enterprises, realize real inventory reduction and service level improvement.

20 Supply & Demand Chain Executive March 2015

As the senior executive in charge of $1.2 billion corporate and divisional purchasing and operations, Schuman has overall responsibility for defining and implementing strategic sourcing decisions, and built a worldwide business strategy. He delivered savings in excess of $100 million by developing a strategic methodology and carrying out tactical objectives with win-win purposeful objectives.

Michael Morris, Global Supply Chain Process Leader, Owens Corning In an environment of continuous growth and increasing complexity, Morris created a mature, sustainable platform that enabled the company to work much more efficiently. The turnaround time of global planning changes was reduced from weeks to days, significantly increasing the ability to react to sudden market changes.

Rick Morris, CEO, Thrive Technologies Morris believes that the supply chain must align with a company’s broader strategies. He helps distribution and retail companies improve their supply chain efficiencies by linking key vendors and customers, as well as internally incorporating sales and marketing input (S&OP) into a company’s supply chain plan.

Corcentric makes B2B commerce faster, simpler, and more transparent. We help customers automate and streamline both order-to-cash and procure-to-pay processes.

Dave Lindeen Senior Vice President of Sales Named â&#x20AC;&#x153;Pro to Knowâ&#x20AC;? by Supply & Demand Chain Executive

For more information call (888) 525-7677 or visit corcentric.com.

2015 Pros To Know

OTHER PROVIDER PROS

■■ Chad Rosenberg, American Global Logistics ■■ Blake Shumate, American Global Logistics

■■ Curtis Cote, Censeo Consulting Group

■■ Marrena Anderson, Denali Group

■■ Brian Fischbeck, Censeo Consulting Broup

■■ Lauren Gallagher, Denali Group ■■ T. Grant Dearborn, Denali Group

■■ John DiPalo, Acsis

■■ Steve Chalgren, Arena Solutions

■■ Derrick Moreira, Censeo Consulting Group

■■ Daryl Fullerton, Actian Corp.

■■ Bill Michels, Aripart Consulting

■■ Tom Cisewski, Chainalytics

■■ Jim Phelps, Aegis Strategies

■■ Mike Buseman, Avnet ■■ Marc Kalman, BizSlate

■■ Jonathan Eaton, Chainalytics

■■ Howard Rosenberg, B-Stock Solutions

■■ Ben YoKell, Chainalytics ■■ Derek Rickard, Cimcorp

■■ Steve Lykken, E2open

■■ Hannah Kain, Alom

■■ Kelly Barner, Buyers Meeting Point

■■ Jim Briles, American Global Logistics

■■ Don Pesek, Cass Information Systems

■■ Dan Brunner, Commonwealth Supply Chain Advisors

■■ Brad Delizia, Elemica

■■ Trevor Read, Agistix ■■ Jaymie Forrest, Alexander Prodfoot

■■ Tim Chiu, CBX Software

■■ Ian Hobkirk, Commonwealth Supply Chain Advisors ■■ John Neblett, Commonwealth Supply Chain Advisors ■■ Trey Lyda, Comprehensive Logistics

your supply chain Only Logility Voyager Solutions™ can help you leave the competition behind by getting the right products at the right cost to the right place at the right time.

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22 Supply & Demand Chain Executive March 2015

■■ Steve Olender, Comprehensive Logistics ■■ Kevin V. Cox, ConnectShip ■■ Dave Lindeen, Corecentric

■■ Peter Edlund, DiCentral ■■ Thuy Mai, DiCentral ■■ Brian Savage, DSSI ■■ Geoff Annesley, E2open ■■ Pawan Joshi, E2open ■■ Sanjiv Bhatia, Elemica ■■ Arun Samuga, Elemica ■■ William Gindlesperger, eLynxx Solutions ■■ Gavin Murphy, Entercoms ■■ Rahul Singh, Entercoms ■■ Stacy Kannawin, 4Sight Supply Chain Group ■■ Greg Puckett, 4Sight Supply Chain Group ■■ Zvi Schreiber, Freightos ■■ Kirit Goyal, Gazelle Information Technologies ■■ Santosh Niar, GEP

■■ Ara Arslanian, Corporate United

■■ Tina Vatanka Murphy, GHX

■■ David Clevenger, Corporate United

■■ Sergio Retamal, Global4PL

■■ Andrea Morton, Corporate United

■■ Robert A. Rudzki, Greybeard Advisors

■■ Jeff Silver, Coyote Logistics

■■ Roger Layette, HICX Solutions

■■ Roger Blumberg, Deem

■■ Douglas Markle, HICX Solutions

■■ Patrick Grady, Deem

■■ Grant Watling, HICX Solutions

■■ William Kohnen, Deem

CROSS-BORDER SHIPPING SOLUTIONS FROM THE NORTH AMERICAN 3PL LEADER FOLLOW US

DOWNLOAD THE CROSS-BORDER EXECUTIVE BRIEF

WATCH THE CROSS-BORDER VIDEO

facebook.com/transplace

transplace.com info@transplace.com

twitter.com/transplace

1.888.445.9425

linkedin.com/company/15678

2015 Pros To Know Other Provider Pros (continued)

■■ Jeff Karrenbauer, Insight Inc.

■■ Fabrizio Brasca, JDA Software

■■ Mark Burstein, NGC Software

■■ Dan Radunz, HighJump Software

■■ Jeff McCauley, Integration Point

■■ Anand Medepalli, JDA Software

■■ Brett Schemerhorn, Hyster

■■ Claudio Marques, Integration Point

■■ Adeel Najmi, JDA Software

■■ Charles Dominick, Next Level Purchasing

■■ Tim Conroy, IBS

■■ James Meares, Integration Point

■■ Anne Omrod, John Galt Solutions

■■ John Allen, International Asset Systems

■■ Michael Allinder, Kewell

■■ Nadeem Ellahi, IBS ■■ Matt Smith, icix ■■ Laura Hodges, IHS ■■ Katie Tamblin, IHS ■■ Mark Ulmer, IHS ■■ Martyn Gill, InfinityQS International ■■ Michael Lyle, InfinityQS International ■■ Nick Pellegrino, Inmar

■■ Paul Crinks, International Asset Systems ■■ Brian Hoffmeyer, IQNavigator ■■ Melissa Drew, isoftstone Inc. ■■ Stephen Durston, Jamaica Bearings Group

■■ Celeste Catano, Kewell ■■ Manik Sharma, Kinaxis ■■ Robert Martichenko, LeanCor Supply Chain Group

■■ Melanie Prestridge, Pace Harmon ■■ Craig Wright, Pace Harmon ■■ Matt Yearling, PINC Solutions ■■ Yves Provencher, PIT Group ■■ Thomas Dieringer, Pool4Tool

■■ Jason Nurmi, LeanLogistics

■■ Dan Grant, Prime Advantage

■■ Mike Detampel, LLamasoft

■■ Mike McDonald, Prime Advantage

■■ Neelima Ramaraju, LLamasoft

■■ Sheila O’Sullivan, Prime Advantage

■■ Diego PantojaNavajas, LogFire

■■ Meredith Marshall, Puridom

■■ David Pennino, LogicSource

■■ John Costanzo, Purolator International

■■ Scott Fenwick, Manhattan Associates

■■ Victor Allis, Quintiq

■■ Michael Mulqueen, Manhattan Associates

■■ Rose Kelly-Falls, Rapid Ratings

■■ Russ King, MEBC

■■ Arturo Hinojosa, Reddwerks

■■ David Rhodes, MEBC ■■ Dave Bowen, MM4 ■■ Jill Ivancich, MM4 ■■ Anne M. Kohler, The Mpower Group ■■ Dalip Raheja, The Mpower Group ■■ Joseph K. Gallick, National Lease ■■ Gavin Davidson, NetSuite ■■ Paul Gettings, Network Global Logistics 24 Supply & Demand Chain Executive March 2015

■■ Steve Keegan, Pace Harmon

■■ Alex Ramirez, Reddwerks ■■ Jim Lawton, Rethink Robotics ■■ Heiko Schwartz, Riskmethods ■■ Charles Clark, Rosslyn Analytics ■■ Hugh Cox, Rosslyn Analytics ■■ Jeff Sweetman, Rosslyn Analytics ■■ Cliff Otto, Saddle Creek Logistics

Other Provider Pros (continued) ■■ Mary Zampino, Sourcing Interests Group

■■ Geoff Bastow, UPS

■■ John Haber, Spend Management Experts

■■ Perry F. Rotella, Verisk Analytics

■■ Michael Croasdale, Source One Management Services

■■ Paul Steiner, Spend Management Experts

■■ Dan Labell, Westfalia Technologies

■■ Edward Lewis, Steelwedge Software

■■ Martin Przeworski, Source One Management Services

■■ Paul Hendrikse, W&H Systems

■■ Pervinder Johar, Steelwedge Software

■■ John Dillon, Wynright Corp.

■■ Amanda Bohl, Supply Vision

■■ Randy Marble, Wynright Corp.

■■ Joey Benadretti, SYSPRO USA

■■ Gonzague de Thieulloy, Xchanging Procurement

■■ Ronald D. Southard, SafeSourcing

■■ Sean Riley, Software AG

■■ Ole Nielsen, Scanmarket North America

■■ Brad Carlson, Source One Management Services

■■ Jeremy Becker, SciQuest ■■ Mitchell Weiss, Seegrid Corp. ■■ Aggie Hanczewski, Selectica ■■ Constantine Limberakis, Selectica ■■ Patrick Stakenas, Selectica ■■ James Kandilas, The Shelby Group ■■ Omer Abdullah, The Smart Cube

■■ Dawn Tiura Evans, Sourcing Interests Group ■■ Sarah Holliman, Sourcing Interests Group

OTHER PRACTITIONER AND TEAM PROS TO KNOW ■■ Josh Lankford, Advance Auto Parts

■■ James Gavin McCarthy, Equifax

■■ Sean Smith, Agropur

■■ The Team from ExtenData

■■ The Team from Armada ■■ Jake Barr, BlueWorld Supply Chain Consulting ■■ Nancy Jorgensen, Brunswick ■■ Tom Flies, Cadec Global ■■ Sean Fitzpatrick, Cardinal Health ■■ Jacqueline E. Bailey, Cargill Inc. ■■ Edna Conway, Cisco Systems ■■ Joanna Martinez, Cushman & Wakefield ■■ Louis A. Galczynski, Endo Pharmaceuticals

■■ Ronald Chang, UPS Capital

■■ Robert F. Byrne, Terra Technology ■■ Dennis Groseclose, TransVoyant

CONGRATULATIONS TO OUR 2015 PROS TO KNOW Jake Wojcik

Tom Beaty

Brent Eiland

Senior Vice President

Chief Executive Officer

Executive Vice President

■■ Francois d’Ivernois, LiveSource ■■ William Duty, Momentive Performance Materials ■■ Kunal Thakkar, Newegg ■■ Richard D. Slack, Oildex ■■ Rebecca Karp, Sourcing Synergies ■■ Eric Wilson, Tempur & Sealy

Strategic Sourcing | Procurement Transformation Spend Visibility |

Indirect Consortia | Managed Services|

■■ J. Carlos P. Villasenor, TransProcure Corp. ■■ Pat DeSutter, Yale Materials Handling ■■ Jason East, YP

www.insightsourcing.com | (678) 812-2020 March 2015 Supply & Demand Chain Executive 25

best practices supply chain collaboration

Collaborate for ROI

There are eight requirements for a successful supply chain collaboration implementation By Anil Kodali

Implementing a supply chain collaboration platform can be greatly aided with some simple pre-planning and preparation. In my experience, companies that neglect one or more of these areas often run into (avoidable) challenges as a result. Ensuring these eight requirements are in place can help get you up and running to drive a faster return on investment (ROI).

1. Ensure internal stakeholders are ready. Many mid-market companies still handle a majority of procure-to-pay activities manually, so the change that comes with transitioning to automated processes can be challenging for team members and negatively impact team morale. To prevent this, ensure all stakeholders are on board with the project by getting buy-in from them on the productivity and cost advantages for the organization, as well as the priority for the project relative to other initiatives. If the changes result in a reduction of job duties for a position or group of positions, consider alternate responsibilities for those affected within the organization. And finally, identify any other divisions of the organization that could be affected (positively or negatively), and include them in the discussions early so they can prepare and support the transition.

2. Identify the key functionality and ROI requirements. Once there is buy-in from internal stakeholders, clearly define the projectâ&#x20AC;&#x2122;s specific functional (what it needs to achieve) and ROI (how soon it needs to pay for itself ) requirements. Itâ&#x20AC;&#x2122;s also helpful to segment the requirements into buckets of critical needs and nice-to-haves. It is rare that any out-ofthe-box solution satisfies 100 percent of the requirements list, but the upkeep and maintenance of solution customizations can quickly erode ROI and drive up total cost of ownership. Determine if there are any other needs, such as performance metrics or support for mobile devices.

3. Determine whether your implementation is going to be on premise or software as a service (SaaS). The solutions available on premise or as SaaS vary widely. The information technology (IT) team can help make this selection from a technology standpoint, but if a quick ROI is important, then SaaS is by far the preferred option. Either way, because the IT team needs to be involved, securing buy-in at an early stage is critical. On-premise solutions require IT involvement for the duration of the implementation and throughout the life of the installation. This also includes scoping and deploying any hardware required for the solution (such as new servers). SaaS solutions, on the other hand, have minimal IT support requirements, and are typically focused on setup and maintenance of the required connectivity between your enterprise resource planning system (ERP) and the third-party solution.

4. Research which solutions are available for your ERP. Some ERPs offer their own supplier integration portals. Appropriate study should be made regarding the advantages and disadvantages of using themâ&#x20AC;&#x201D;both in terms of functionality and cost. If you have multiple ERPs, including custom home-grown systems, it would be better to consolidate or use third-party systems that can handle multiple ERPs. 26 Supply & Demand Chain Executive March 2015

best practices supply chain collaboration

5. Find out how your ERP can integrate with third-party solutions. One of the major hurdles in successfully implementing any third-party solution is having the required tools, systems and IT resources to help with the integration. Determining the current tools, systems and IT resources available, and gathering any missing resources are the most time-consuming activities, and should be amply discussed and planned prior to any implementation project. Look for solutions that can integrate using a variety of protocols (XML, EDI, CSV, etc., using HTTPS, SFTP, AS2, etc.). The more options available, the more likely the solution can fit what is already available within the organization. Also, determine if some internal data is present in other third-party applications. If so, integration with those systems may also need to be considered.

6. Put a supplier onboarding strategy in place. Supplier onboarding is absolutely critical to any collaboration project. The final success or failure is directly linked to the number of suppliers who adopt the system. Larger companies have an advantage here as they can often dictate which systems their suppliers use. However, as mid-market and smaller companies often do not have similar leverage, additional planning, communication, favorable terms and support services are often helpful to make the system as easy and appealing to suppliers as possible. Having a plan well in advance and keeping your suppliers updated regularly on the implementation helps to gain their trust.

7. Plan your testing and training schedule for the maximum amount of user preparation before launch. Itâ&#x20AC;&#x2122;s important to establish realistic timing for user training (internal and external) for the new solution. Often times, the solution provider can provide a training and support program. Additional time invested during user acceptance testing and training during the implementation can go a long way to reduce confusion, frustration or reluctance to use the system. The better trained and more confident your users are, the faster they are able to take advantage of the benefits the new platform offers.

8. Set a quick implementation timeline. A better ROI is achieved when the overall costs to implement are low and the implementation is completed quickly. An implementation cycle of less than three to four months (including all data integration) can convince the internal stakeholders and decision influencers that the project can pay for itself sooner rather than later and help to justify a higher priority.

Conclusion All mid-market companies interested in supply chain automation should review the eight requirements above. This pre-planning and preparation can help ensure a smooth and rapid implementation for a third-party supply chain collaboration solution, as well as long-term success. About the Author: Anil Kodali is the vice president of services for TAKE Supply Chain, and leverages more than 18 years of IT experience in the supply chain and life sciences domains. In his role overseeing consulting services and post-sale customer satisfaction, he and his team work closely with customers to support current needs, plan for future supply chain solution requirements, and incorporate customer feedback into the product road map. He holds a BE, EE; a masters in physics; a project management professional certificate; and a Six Sigma Green Belt. March 2015 Supply & Demand Chain Executive 27

best practice third-party outsourcing

Minimizing the Bad Things that Can Happen to a Good Company When it comes to managing third parties, an organization can never outsource the liability or risk in its supply chain By Carrie Mantey

n today’s global economy, thirdparty relationships exist because businesses realize that they may not have the core competency or capacity to do everything themselves. By summoning a third party, organizations can get the muchneeded help to push their products or services to market better, faster and/ or more cost-effectively. However, when they invite a third party into the four figurative walls of their company, there is always inherent risk because they lose some control of their products or processes. They are liable not only for their actions, but also the actions of their third parties. Therefore, it behooves businesses to determine and continuously monitor their third parties’ risk. According to Greg Dickinson, the CEO of Hiperos, “All third parties are outside of the four walls of your company, yet you depend on those third parties to help bring your product or services to market. There’s some research that suggests, depending on your industry, anywhere from 40 to 60 percent of your revenue is dependent upon the execution of these third parties.”

28 Supply & Demand Chain Executive March 2015

Before sending that formal invitation out to their prospective third party, organizations must first ensure that the third party’s contribution outweighs its risks. Any third party that a company collaborates with can have the unintended consequence of impacting its reputation, regulatory responsibility and revenue—what Dickinson calls the three Rs.

Familiarizing Your Business with Risk Factors “We always say that bad things can happen to good companies,” says Dickinson. While those bad things aren’t necessarily or directly an organization’s fault (geopolitical turmoil, natural disaster, etc.), they can be due to risk factors that perhaps were never considered or could be minimized. Companies are saying that so many problems happened over the last few years that they’re “outside the bounds of that notion of where their risks are,” so now they are getting into the habit of keeping tabs on all of their third parties— vendors, suppliers, affiliates, resellers, distributors, outsourcers, and the list goes on.

Regarding a recent supply chain issue, Dickinson laments, “Chipotle can no longer put pork in 600 of its restaurants because one of its third parties, a pork supplier, was not following the sustainability guidelines for animal wellness. From a financial impact, it’ll be interesting to see what the ramifications are. Nobody is going to remember or care whom that third party is. Some may look at Chipotle and say it did a poor job of managing its third party, and therefore, it is painted with the same brush—cruelty to animals. That all could be prevented with understanding the third party, better management, and signoffs and auditability around what that thirdparty supplier was doing.” First and foremost, organizations must understand that they can’t fix anything that they don’t know is broken. Information is key and there are many questions to be answered, such as: ■■Who are my third parties? ■■What are they doing for me? ■■What level of risk can they subject my organization to? ■■Who in the organization is interfacing with them? ■■Are they given access to customer data? (If so, it is the company’s reputation that suffers most if a data breach occurs.) ■■Are they following a corporate sustainability index, supplier policy, and your code of conduct or way of doing business? ■■What types of due diligence, controls, audits and/or inspections were instituted? ■■Were the principals of the third party vetted? ■■Are they on any anti-business sanction lists published by the U.S. government?

Yesterday’s logistics was mainly about lifting and loading.

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best practice third-party outsourcing ■■Are they subjecting the organization to bribery or corruption risks? Are they based in a location known for high amounts of cybercrime or bribery? Of course, nobody can prevent bad people from doing bad things, but if a business apologizes and can list the 18 or 20 steps that it went through to prevent something catastrophic from happening, its reputation is harmed less because the best effort was made as opposed to the company covering its eyes, or worse, never opening them in the first place. In that case, Dickinson says, “Then you really are to blame and you’re just as bad as the perpetrator.”

Effective and Efficient Management of Your Third Parties Frequently, organizations prefer to begin with understanding the idea of the risk of the project, such as bringing on a new supply chain third party. Then, if the prospects look good, a third-party management company can help the organization progress through the vetting and onboarding process, and then continually perform a lifecycle of managing that third party, which could entail risk and compliance on an annual reporting basis. Regardless, Dickinson advises, “If you’re going to manage something, it’s much better to manage the full lifecycle as opposed to picking and choosing what aspects of that third-party relationship you want to manage.” To start, an organization needs a database or repository to store all of its third-party relationships, records, contracts and statements of work (SOWs), so that the right people can have the proper access to information when it’s an immediate necessity.

30 Supply & Demand Chain Executive March 2015

concern? Let’s pretend that it’s only Once that infrastructure is in place, 20 percent, so out of that number, then a third-party management what level of concern should we have? solution, can help the business And once that is figured out, then automatically manage the aspects you can put the proper due diligence, that are important to it, whether that controls or vetting in place dependent be the risk appetite of the company upon the level of regulatory concern,” or understanding third-party according to Dickinson. “If you segmentation, but most importantly, treated all third parties with the same which kind of risks is the organization level of management, you’d go broke most worried about, whether and never get it done. By being able it be financial liability, business to subset continuity and and segment disaster recovery, Businesses shouldn’t think and tier, you or geopolitical, of third-party management don’t need to operational or software as just a database do the same transactional risks. Once those or platform, but also a book level of due diligence for kinds of risk levels of record that can aid in those that are identified, limiting liability. are high as third-party opposed management to low. That’s how we help our software can help automatically customers to get their arms around establish a series of controls or due all third parties when we say put the diligence processes to manage the right information in front of the right third parties in an effective and person at the right time.” efficient manner. Businesses shouldn’t Another benefit to implementing think of third-party management a third-party management system software as just a database or is to avoid paperwork. Dickinson platform, but also a book of record mentions that Hiperos has a thirdthat can aid in limiting liability. party network (TPN) that allows Why Integrate? organizations to leverage information Some third parties reside only in an that was already collected about their organization’s procurement, supply third parties, so they don’t need to do chain, accounts payable, intellectual it themselves if 50 other companies property (IP) governance, regulatory already did. That way, information compliance or even perhaps is at their fingertips in days as information technology (IT) vendor opposed to months by eradicating management system. By integrating the requirements of reaching out all of them into one platform, a to that third party, collecting the business is already eliminating a information, manually entering it, gap in knowledge. Furthermore, etc. When businesses were using when a company compiles its third paper-based methods, statistics show parties into one database, it can then that it wasn’t unusual to take 90 days segment them quickly to quantify or longer just from the onboarding specific risks. process. These are just some of the For example, “out of the 50,000 ways that good organizations can that we have, which third parties minimize the impact of bad things. ■ could subject us to regulatory

best practices service operations

Service as a Strategy Think service, think profit By Nitin Ahuja

raditionally more of an afterthought than a key business strategy, service operations can contribute up to 70 percent of gross margins for many organizations, often providing a greater rate of return than manufacturing. CEOs who incorporate service as a key component of global corporate strategy can position their organizations to capture greater customer loyalty and exploit untapped sources of future growth. Executives need a fresh look at service, focusing on developing strategic initiatives to address how service is managed and how it can be leveraged to drive revenue. Digging deep into the service supply chain is necessary to understand promises made to customers, those that can be kept, those that leave the company exposed and how to cover the gaps. It is the service supply chain that translates corporate strategy into execution, ultimately satisfying or disappointing customers. Research indicates that loyalty is increasingly driven by the service experience in lieu of the brand: customers buy the experience. Progressive companies are elevating service operations, using it to capture market share and leveraging service events to create positive customer interactions resulting in future product sales. While revenue from new product sales varies, service contracts can provide a consistent touch point and revenue stream. Unlike new product sales, service revenue is less dependent on economic conditions, and often increases during harsh economic

times as customers opt to repair rather than replace products, which can offset thinning margins.

From Planning to Profit

Competing Strategically

Cost-effective service hinges on understanding the actual cost to serve, a complex metric requiring mathematical modeling to predict failure rates, needs for replacement parts and service expertise. Many service organizations struggle to balance customer satisfaction metrics and service level agreement (SLA) requirements against inventory levels and service costs. Effectively operating on a global scale requires proactive and predictive inventory planning. It is impractical to stock replacement parts for every potential situation given carrying and scrap costs for excess or obsolete inventory. Applying predictive models to understand where exposures exist for non-compliance and critical care enables optimized operations to meet service obligations. Agility is imperative. The ability to adapt strategies and processes to changing market conditions requires technology, analytics and execution. Predictive analytics models can predict failures, reduce variability, and enable service operations to plan and respond to the most critical failures.

As service operations grow in importance, the disconnect between the forward and service supply chain begins to diminish. While manufacturing and service currently operate separately and have conflicting objectives, as service operations mature, the logical move is integration. Integration offers a holistic approach in which intelligent choices can be made to cover the entire product lifecycle. The impact on cost and revenue would be monumentalâ&#x20AC;&#x201D;the impact on customer satisfaction, even more so. Technology ranging from selfservice portals to remote devices via the Internet of Things is changing the way service is offered and how customers interact with service organizations. These technologies drive a companyâ&#x20AC;&#x2122;s ability to gravitate toward service as a strategy. In an era in which most businesses want to convert to something as a service, CEOs must recognize that if service is the something, service as a strategy can be the catalyst that drives competitive advantage, growth and profitability. â&#x2013;

About the Author: Nitin Ahuja is the co-founder, chairman and CEO of Dallas-based Entercoms. He has more than 20 years of experience in the technology and enterprise software application industry. Ahuja began his career at Xerox where he led one of the first successful engineering outsourcing projects to India. In 1995, he founded Anavidere Technologies and refined the business model of offshore product development. He then founded ECMi in 2001 to develop solutions for collaboration performance management in supply chains. Ahuja holds a Bachelor of Science degree in mathematics and physics from Pune University, and an MBA from the Institute of Management Development and Research, Pune, India. For more information, please visit www.entercoms.com. March 2015 Supply & Demand Chain Executive 31

best practices reverse logistics

National Returns Day Find unexpected opportunities amidst that pile of customer returns

t isn’t a real holiday and no one can take the day off, but one national carrier designated Jan. 6, 2015 as National Returns Day, reflective of the high volume of e-commerce-generated returns that flood the logistics pipeline during the post-holiday period. By one estimate, as many as 4 million packages were shipped back to retailers during the first week of January. This spike highlights the fact that returns are becoming an integral part of the overall retail experience. But handled correctly, a business’ returns policy can be an effective way to positively connect with consumers and a source of new revenue opportunities. The first thing to understand about consumer returns is that they are inevitable. The National Retail Federation reports that 8.6 percent of total sales are returned, a figure that represents more than $3.1 billion annually. And that figure surges for online fashion retailers, which can expect a returns rate between 20 and 30 percent. A Wall Street Journal report on the high volume of e-commerce returns noted that one consumer ordered 10 pairs of corduroy pants, fully expecting to 32 Supply & Demand Chain Executive March 2015

By John Costanzo return most of them after deciding which color and fit she liked best, from a national retailer’s website. When asked about the costs her athome dressing room strategy would incur for the retailer, the consumer responded: “I feel justified. After all, I am the customer.” This consumer is not alone in her thinking. Research overwhelmingly shows that consumers have very strong expectations about how retailers should structure their returns policies and will not hesitate to abandon a retailer that is perceived as offering anything short of a hasslefree, easy returns experience. For example, one national poll of online shoppers found:

A separate survey found that 85 percent of consumers do not return to a retailer with an inconvenient returns policy. Clearly, power is shifting to the consumer. Smart businesses recognize this and are taking steps toward a customer-focused, efficient returns policy. In the process, many businesses are discovering an interesting fact about product returns: Roughly 80 percent of all product returns are not damaged or defective. Instead, most products are returned because of customer preference issues, ranging from a customer changing his or her mind to a product not fitting correctly to something looking different than it did in a catalog or online to a consumer finding the same product cheaper elsewhere.

65% expect free shipping for their returns 58% want a “no questions asked” policy a return label 53% prefer to have included in the original packaging xpect their debit or credit card to be automatically 47% ecredited once the return is received by the retailer 43% want an easy-to-print label ability to return an 39% want thepurchase online to a store

National Poll for Online Shoppers

best practices reverse logistics

In the old days—going back five or 10 years—retailers would simply write off the entire pile of returns without stopping to realize that any potential value could be salvaged. Today, though, is a different ballgame with product returns finding second lives on secondary markets. Secondary market venues include outlets, discount stores, overstock websites, auctions and flea markets. Secondary market sales skyrocketed in recent years with reverse logistics specialist Greve-Davis estimating that the value of U.S. secondary markets account for 2.28 percent of gross domestic product. Once a business understands the importance of an effective returns management process, the question becomes how to create a plan that meets its specific needs, yet is not cost prohibitive. This is the point when it usually makes sense to call in the cavalry, namely a well-qualified logistics provider with experience and a solid track record in reverse logistics management. The first thing your logistics provider should do is conduct a complete audit of your reverse logistics needs and ascertain the key components of your business’ strategy: ■■What is your expected returns volume? This determines how frequently returns need to be picked up and delivered to your designated returns processing center. ■■How are returns to be processed? Many businesses offload the returns process to their logistics provider who evaluates each return and determines its specific course of action. Non-damaged items may be returned to inventory, for example, while out-of-season

or obsolete items can be sent directly to a secondary outlet. Damaged materials can either be serviced by in-house trained personnel or outsourced to a repair center. Vitally important is that customers are issued replacement items or credits/ refunds in a seamless, expedited manner. ■■What role does technology play? Technology, of course, makes today’s efficient reverse logistics processes possible, but a surprising number of retailers have yet to update their systems. An experienced logistics provider can work around this by using its own system to allow critical customer service functions, including online tracking capability, label generation, use of returns material authorization (RMA) and recordkeeping functionality. Many businesses also fail to realize that cloudbased solutions now make it possible for retailers to take advantage of returns processing systems that were previously costprohibitive. ■■What can you learn from your returns? Businesses that see a spike in returns of a particular product can capture valuable information as a way to address what may be a design flaw or a product characteristic that is a turnoff to customers. Is a new piece of machinery or appliance too hard to operate? Are the instructions too complicated? Or maybe a style of boots isn’t selling because the cut is too narrow. There can be a million reasons why products are returned, but rather than assume those reasons are outliers, a manufacturer would be wise to pay attention

and possibly identify product improvements that could reduce their return rates. ■■Do you expect international returns? A growing number of U.S. businesses have strong e-commerce operations in Canada, for instance, and must be ready to accommodate crossborder returns transactions. This means a trip through U.S./Canadian customs, which requires expertise in regard to all applicable paperwork, duties/ fees and security protocols. Do not underestimate the complexity of the cross-border process, and make certain your logistics provider has the experience and expertise to do the necessary work up front to help you get your products back into the U.S. in a smooth and cost-effective manner. I saw a statistic that the typical consumer returned four gifts during the 2014 holiday season. That figure becomes somewhat disconcerting given that another statistic reveals more than half of all businesses do not have an effective returns strategy in place. Technology, supply chain innovations and secondary markets are creating a new way of thinking about returns management. Any retailer that still needs to embrace the potential within its returns process is missing out on opportunities to connect with consumers and possibly recapture revenue. A well-placed phone call to a qualified logistics provider can start the process of putting these businesses on the right track. ■ About the Author:

John Costanzo is the president of Purolator International.

March 2015 Supply & Demand Chain Executive 33

global focus reshoring

Reshoring and Total Cost of Ownership Positive trends at home bring manufacturing jobs back from overseas as the rush to offshore slows down By Harry Moser and Millar Kelley

eshoring is the most direct solution for many of the hottest supply chain issues. The drastically shortened lead time greatly reduces the complexity of monitoring all levels of a global supply chain and the importance of longer term forecasting. The shorter distance and lead time also dramatically improve inventory turns and lower the risk of supply chain disruption. Increasingly, companies are using the total cost of ownership (TCO) or similar sourcing metrics, and seeing that these benefits are, in many cases, achievable without sacrificing profitability.

The Background of Reshoring Data from the Reshoring Initiative shows that offshoring of U.S. manufacturing is now in balance with reshoring. Since 2003, new offshoring is down by 70 to 80 percent and new reshoring is up by 1,500 percent. The most important accomplishment is that the net loss of more than 100,000 manufacturing jobs each year ended. New reshoring is now balancing new offshoring at about 40,000 manufacturing jobs per year, resulting in the first neutral year of offshoring job loss/gain in the last 20—the bleeding stopped! As of October 2014, about 170,000 manufacturing jobs were brought to the U.S. from offshore (400,000 total jobs when including 34 Supply & Demand Chain Executive March 2015

the manufacturing multiplier effect of approximately 1.4). That job gain is the result of new reshoring—the return of manufacturing work that

balance the trade deficit. The increased use of TCO alone could cut the trade deficit by 25 percent and bring back 1 million manufacturing jobs. This requires educating companies As of October 2014, about 170,000 to use TCO, and is under the control of our manufacturing jobs were brought to society and corporate the U.S. from offshore (400,000 total culture. Detailed, jobs when including the manufacturing objective reporting multiplier effect of approximately 1.4). on reshoring successes is another necessary element to motivate was previously produced offshore— companies to reevaluate offshoring. and foreign direct investment (FDI) in Second, in the longer term, to the manufacturing sector. These trends get the other 75 percent requires represent about 25 percent of the total improved competitiveness with increase in U.S. manufacturing jobs political and societal actions: tax since the low in February 2010[1]. The reform, currency and tariffs, skilled continued challenge is to bring back workforce expansion, etc. All involve another 3 to 4 million manufacturing politics, and most are cultural and jobs that are still offshore. Meeting endemic. Currency and tariffs are this challenge requires that the positive subject to World Trade Organization trends that are already bringing work (WTO) rules and are influenced by back, such as rising costs offshore and other countries’ actions. There must lower energy costs at home, continue. be much more progress on these Additionally, the U.S. can improve fronts in decades to come than there its competitiveness in the following was in the past. manner: Ideally, it is best to do both sets of First, in the short to medium term, actions. We should be enthusiastic use of TCO or similar comprehensive about reshoring as an important metrics—getting companies to element of the manufacturing recognize all of the benefits of renaissance, but not optimistic about local production and adopt a more the renaissance until all companies comprehensive total cost analysis—is are using TCO for their sourcing the most effective action to accelerate decisions and the longer term actions the return of manufacturing and are being implemented.

Implications for Supply Chains Advantages of local developed-country sourcing

Issues

Fast product launches Local clustered suppliers partner and respond faster. Engineering and manufacturing are close enough to innovate more effectively. Supply chain visibility It’s easier to monitor if close by or at least in country. Supply chain risk With fewer countries as sources of single-sourced components, risk is reduced. Lower inventory/better turns Reshoring often reduces inventory by while avoiding stockouts 50 percent while improving availability. Intellectual property (IP) risk It’s much lower in the U.S. and other developed countries. Quality It’s more predictable in developed countries. Regulatory compliance It’s much higher, especially at lower tiers. Shipping disruption at ports It’s completely eliminated. Family values Minimize long trips and late phone calls. Corruption Minimize or eliminate it. Forecasting Minimize impact due to shorter lead times. Corporate sustainability It’s improved due to smaller on-hand and in a recession pipeline inventories. Product mass customization It speeds partnering and delivery.

Implications for Supply Chains Here is a list of important supply chain and related issues, and how each is mitigated by local sourcing, especially in a developed country. These advantages should be enough to motivate companies to reevaluate offshoring to see whether the overhead, risk and strategic benefits of reshoring now offset the typically higher domestic cost of goods sold. As manufacturing returns from offshore, regional/industrial clusters continue to evolve, requiring an ongoing adaptation of supply chains. Knowing how reshoring, FDI and supply chains mutually influence one another can help supply chain professionals set up infrastructure in anticipation and support of a continued trend toward localized manufacturing.

By reshoring, companies can more easily respond to customers’ changing needs, minimize supply chain disruptions, and eliminate the larger production runs and

inventories associated with longdistance offshoring. Shorter supply chains provide the agility needed for mass customization. Localization shortens supply chains and positions manufacturing near engineering and customers, which gives companies better flexibility to respond and customize quickly. Reshoring can be an important part of a lean strategy. W. Edwards Deming wrote, “End the practice of awarding business on the basis of price tag. Instead, minimize total cost.”[2] The impact of offshoring on each of the seven Toyota wastes is described in the table below. When manufacturing is moved next to engineering, companies can improve design, eliminate waste, improve quality and increase productivity, often making a better product more easily and at a lower cost. Increased productivity makes the product easier to reshore by reducing the U.S. manufacturing total cost vs. offshore. Many companies find that, although the production cost is lower offshore, the total cost is higher, making it a good economic decision to reshore manufacturing to the U.S.

Impact of Offshoring on Each of the Seven Toyota Wastes Toyota Wastes

Offshoring Contributes

Overproduction Large batch shipments, filling containers Waiting Uncertain delivery/inconsistent quality, port, customs, shared “awake time” window for discussions Transport 12,000 miles inbound, 6,000 return (boat ½ full) Overprocessing More packing and unpacking, customs paperwork Inventory In transit, cycle, safety stock, uncertain delivery/ quality, less ability to check and count Motion Increased cost over time—repetitive motion injuries or additional labor to compensate Defects Higher than local sources, extra inspection of materials and tolerances, customers unhappy longer March 2015 Supply & Demand Chain Executive 35

global focus reshoring

In order to help companies objectively decide where to manufacture, the not-for-profit Reshoring Initiative offers a free Total Cost of Ownership Estimator™ to calculate the real profit and loss impact of reshoring vs. offshoring. In 2013, the Department of Commerce created the Access Costs Everywhere (ACE) Tool to promote reshoring and greater use of TCO analysis. The most recent addition to ACE is the cost differential frontier (CDF) tool, which allows companies to quantify the potential savings derived from reducing lead times.

Trending Now Currently, the top industries reshoring, by number of jobs, are transportation equipment, electrical

equipment, computer products, and than $136 billion in announced fabricated metal and wood products. capital expenditures driven by the The most commonly cited reasons boom. Much of this investment will for reshoring are lead time, quality, be made in equipment manufactured automation/productivity, rising in the United States. offshore wages, currency variation, Reshoring is not just a U.S. skilled workforce and government phenomenon. The economic benefit incentives. of producing Sixty percent Sixty percent of reshoring is near the of reshoring is consumer coming from China, where coming from is universal, wages are rising at more China, where applying to all wages are rising countries. The than 15 percent a year. at more than reshoring trend 15 percent a year. The Midwest and is beginning and seeing a recent Southeast are the strongest regions for uptick in western Europe, and other reshoring, with South Carolina and regions that saw manufacturing go Michigan leading the pack. offshore in the past. Other factors are helping, too. Replacing imports should become Walmart’s commitment to source more of a focus than expanding an additional $250 billion in U.S. exports. The U.S. trade deficit in products through goods equals about 25 percent of 2022 is having a our manufacturing output—we large impact; this can balance the trade deficit by program could substituting domestic production for add 300,000 U.S. imports. In doing so, we can increase manufacturing U.S. manufacturing employment by jobs. The U.S. 3 to 4 million jobs and overall U.S. shale gas and employment by 6 to 9 million jobs oil boom is due to the manufacturing multiplier also playing effect. a key role. Reducing imports is more cost The American effective than increasing exports Chemistry because U.S. factories are about 30 Council percent more price competitive here additionally than when exporting, for example, identified more to China. ■ About the Author: Harry Moser is the founder and president, and Millar Kelley is a research analyst at the Reshoring Initiative, which provides a broad range of free resources to help companies make better sourcing decisions. Among the resources are the Total Cost of Ownership Estimator, the Reshoring Library, case studies and more. For more information, please email info@reshorenow.org.

[1] There were 11.45 million manufacturing jobs in February 2010. About 12.2 million Americans are now employed in the manufacturing sector. [2] “4th Key Principle for Management,” Out of the Crisis, W. Edwards Deming

36 Supply & Demand Chain Executive March 2015

industry focus automotive

Shifting Gears: The Road Ahead for Automakers By Keri Dawson

A record year of recalls requires better supplier visibility, an efficient reverse supply chain and a commitment to quality

he global automotive industry is competitive with automakers all focused on delivering the highest quality product at the lowest cost possible. Meanwhile, the explosion of third parties across the supply chain, global parts sourcing, and distributed manufacturing and assembly operations are compounding the associated risks, and also inviting greater regulatory oversight. These factors are motivating automakers to rethink and reassess their existing programs with many turning to the enabling role of technology to promote greater cost savings and efficiencies. However, many are quickly discovering that the real value of technology goes far beyond these measures. By establishing a single source of truth 38 Supply & Demand Chain Executive March 2015

with real-time data and visibility internally, as well as across global manufacturing facilities and supplier locations, automakers can harness the information they need to make more confident decisions and achieve better business outcomes.

The Safety Crisis The alarming number of automotive recalls serves as a reminder that there is much work still to be done. From pickups to minivans, year 2014 saw the most recall efforts ever for automakers around the globe. Last year, in the United States alone, automotive manufacturers issued more than 550 recalls for over 52 million vehicles, according to the Associated Press. In other words, last year, one out of every five vehicles on American

roads was the subject of a recall. The previous record, set in 2004, was for 30.8 million recalled automobiles. In 2014, of more than 52 million recalled vehicles, nearly 17 million involved those recalled for potentially defective airbags equipped with inflators built by Japanese supplier Takata. When Takata initially announced the fault in April 2013, only six automakers were involved. However, later admissions revealed that the company had little understanding of which vehicles used the defective inflators, prompting additional recalls. This recall was extended to include 10 automakers, including BMW, Chrysler, Ford, General Motors, Honda, Mazda, Mitsubishi, Nissan, Subaru and Toyota. The National Highway Traffic Safety Administration (NHTSA) has the authority to set vehicle safety standards as well as require manufacturers to recall vehicles that do not meet these standards. While

manufacturers voluntarily initiate panic with a rapid rise in inquiries, what does this look like in practice? As a first step, organizations must many recalls, others are prompted by and support and service requests. establish transparent and robust NHTSA investigations. In the last However, the biggest impact of all is around diminished brand and processes across multiple tiers of their 10 years, manufacturers reportedly suppliers and third-party vendors. reputation, a loss of investor and recalled 83 million vehicles of their The parent organization should have stakeholder trust, and a decrease in own volition, compared with 86 customer loyalty—all of which have a firm grip on its extended supply million initiated by NHTSA actions chain, diligently monitoring suppliers or investigations. and product lifecycles. This allows In theory, the “Last year, one out of every five for quick identification and response recall process is fairly vehicles on American roads was to any issue or failure in the chain. straightforward: The Advanced technologies can help automaker identifies the subject of a recall. The previous organizations automate, simplify and a problem, reports it, record, set in 2004, was for 30.8 streamline related activities to achieve notifies customers and million recalled automobiles.” this level of transparency. halts further production Secondly, once suppliers are visibly until the defect is and transparently mapped, their an adverse impact on future sales. corrected. However, it is actually quality and safety practices, programs A company’s initial recall response, much more complicated. Following and protocols must be the subject strategy and remediation plan set the a recall, there are a series of reverse of far greater oversight. Tightly foundation for successfully managing supply chain activities that must be integrating the supplier community the crisis and restoring trust. In the addressed, which include retrieving a within a strong safety culture can automotive industry, a recall often used and defective product from the includes multiple end customer, and either disposing it vendors that share or fixing it. similar supply Many industry experts suggest chain partners that one of the biggest reasons or vendors, all for automotive recalls is the sheer of which can be technological complexity of vehicles cast into the same today. As automobiles continue to recall spotlight. become more sophisticated, and as This emphasizes more technology-enabled features are introduced, the likelihood of an the need for a automotive recall increases. tightly managed, collaborative and coordinated recall The Impact of a Recall approach and In an industry in which the Labeling is critical when considering a business’s ability to response. end product has the potential to respond to evolving customer and regulatory demands. impact human safety and life, The inability to meet labeling requirements can result in A Culture of automotive recalls present some re-labeling, fines, non-compliance and customer dissatisfaction. Quality and serious repercussions. Attorneys will Find out how Loftware’s Enterprise Labeling Solutions empower Safety likely take legal action against the leading companies to meet the complex and high volume automaker over possible deceptive Taking requirements of today’s global supply chain. claims made to consumers about accountability the safety of their cars. Meanwhile, and responsibility Loftware the True Leader in Enterprise Labeling Solutions www.loftware.com regulatory bodies will focus their for the products For more information contact Loftware @ 1-603-766-3630 x405. attention on understanding whether and services from the automaker or NHTSA failed to your suppliers, address quickly and properly any and ensuring safety complaints. For consumers, a safety and quality Or, go to http://Resources.Loftware.com/SpecialReport to take a look at our Special Report: Enterprise Labeling - A Supply Chain Strategic Imperative recall usually leads to concern and is critical. So,

DOES YOUR LABELING CAUSE YOUR SUPPLY CHAIN PAIN?

March 2015 Supply & Demand Chain Executive 39

industry focus automotive help ensure that all suppliers have common, rigorous quality and safety processes. By leveraging available technology, automotive suppliers can automate related end-to-end processes, spanning quality and safety audits, and supplier surveys and certifications. Additionally, compliance management systems can provide a centralized and integrated approach to ensure adherence not only to internal recallrelated requirements, but external requirements as well.

The Enabling Role of Technology Solutions for corporate governance, risk management and regulatory compliance enable automakers to shift from isolated compliance initiatives and departmental silos of risk-related information, to

fully integrated enterprise-wide governance, risk and compliance (GRC) strategies. Leading automotive companies around the world are adopting a technology-enabled approach to prevent recalls before they happen and create new opportunities for growth. Some benefits include: ■■Accelerated time to market: Using technology, automotive companies can gain realtime visibility into quality management processes, and related key performance metrics help accelerate product development and time to market. ■■Reduced costs: Automotive companies can lower the overall costs of poor quality, production downtimes, product recalls and warranty costs by using technology

solutions that can establish operational efficiency, efficacy and consistency throughout quality processes and programs. ■■Improved product quality: Technology can create a transparent environment in which decisions are based on facts, data and metrics. Issues can also be more proactively identified, tracked and resolved. ■■Ensured compliance: Technology can also help create a more integrated and streamlined approach to ensure compliance with industry standards, regulatory requirements and internal policies. ■■Customer loyalty: With technology, automotive companies can better monitor, track and resolve customerreported product and quality issues in a consistent, systematic and repeatable manner. Creating a technology-driven complaints management program can also help record customer complaints and automatically route them for further internal review, root cause analysis and remediation. The automotive industry supply chain grows increasingly global and complex by the day. By leveraging advanced technology solutions, organizations can achieve more reliability, efficacy and value across their operations, while driving a culture of quality and safety across the supply chain. ■ About the Author: As vice president of industry solutions and advisory services at MetricStream, Keri Dawson is responsible for leading the continued growth of the company’s enterprise solutions and services portfolios. She specifically focuses on emerging market needs in the retail, consumer goods and food industries.

40 Supply & Demand Chain Executive March 2015

case study AP and AR automation

Going Paperless Gain efficiency and save money with automation By Alyssa Kadansky

paper documents are lost forever after filing, the automated process keeps invoices and other documents meticulously organized, always on hand and searchable. Employees can use time more efficiently rather than wasting time with manual data entry.

ew technology is allowing companies to become more streamlined and minimize manual processes, especially in their accounts payable (AP) and accounts receivable (AR) departments. One way these departments are becoming more efficient is by going paperless with a document management system, which helps businesses manage time more effectively, utilize the full functionality of their enterprise resource planning (ERP) solution and improve business processes.

everybody more efficient to prepare for our growth.” AR Automation Leeco searched for a paperless Prior to implementing the paperless document management solution to: ERP, the AR department endured ■■Increase employee efficiency. a multi-step process to manage ■■Simplify AP processes. documents. Once the automated ■■Streamline AR processes. workflow was put into place, it was ■■Increase billing accuracy. not only able to reduce the number of ■■Make the AP process more steps in the process, but also, rather transparent. than sending out multiple emails to ■■Find a scalable solution that clients and customers, it could send could apply to other departments. out one all-inclusive email with all The solution Leeco was looking the content that was previously sent for would allow it web access, as individually. well as the ability The results of the implementation for its information were astounding. Leeco, which “The first rule of any technology used in technology (IT) previously processed around 3,000 a business is that automation applied invoices, was now able to process department to to an efficient operation will magnify manage its own 3,600, a 20 percent increase. system to reduce Additionally, Leeco’s daily received the efficiency. The second is that costs. Additionally, it not invoiced (RNI) report, or accrued automation applied to an inefficient would help eliminate payables, which was previously operation will magnify the inefficiency.” the risk of losing documenting $8 million worth of unpaid materials, was reduced to documents and – Bill Gates misfiling papers, only $1 million. The document Major steel distributor Leeco Steel plus minimize manual data entry and management solution reduced the made the benefits of going paperless curtail the mistakes that come with it. number of incorrectly vouchered in its AP and AR departments receipts, and saved the AP department apparent after integrating a document AP Automation time and improved accuracy. management and workflow solution Leeco chose to automate its If better time management, with its ERP software. Because Leeco AP processes with the intention efficiency, cost savings and experienced significant growth over to expand the solution into other environmental impact appeal to you, the years, its executives decided that, departments and create a more it is time to explore the benefits of a paperless document management rather than adding more staff to the efficient workflow. Leeco’s document solution. ■ AP and AR departments, it would management solution managed all of be more beneficial to streamline its invoices, print and the processes and make them more electronic. Invoices were About the Author: efficient. “A lot happened at the indexed, routed and Alyssa Kadansky is the marketing communications specialist at Metafile Information Systems Inc., end of 2013,” Leeco CFO Mark archived electronically, an independent provider of paperless document Krzmarzick said. “We saw a lot of eliminating the need management applications serving middle-market growth and didn’t want to just add for folders and filing and large businesses. For more information, please visit www.metaviewer.com. more people. We needed to make cabinets. While many March 2015 Supply & Demand Chain Executive 41

best practices regional carriers

Regional Parcel Carriers:

The Right Choice for your Business? There are pros, cons and questions to ask when considering this option By Paul Steiner

o increasing shipping costs have you looking at alternative carrier solutions? While the United States is dominated by FedEx, UPS and the USPS, regional parcel carriers are becoming a popular option for many shippers. Regional parcel carriers serve specific regions within the U.S. Several regional carriers partnered and were able to create a more successful delivery network across the country for the likes of such retailers as Amazon, Avon and Walgreens. Major regional carriers provide coverage of approximately 85 percent of the U.S. While the primary focus was traditionally on businessto-business (B2B) parcels, these regional carriers are moving more into business-to-consumer (B2C) and last-mile delivery to take advantage of e-commerce growth. However, there are pros and cons to consider before deciding to enlist regional carriers.

Pros of Regional Carriers The most obvious benefits of working with regional carriers are lower costs. Regional parcel carriers tend to offer freight rates that are about 15 to 30 percent less than those offered by national carriers. Typically, there are also a reduced number of surcharges and lower accessorial rates. 42 Supply & Demand Chain Executive March 2015

Determining dimensional (DIM) weight pricing differs as well. Many regional carriers offer a 3-cubic-foot threshold and either a higher DIM weight factor (a mathematical factor for calculating the dimensional weight of a package) such as 194 instead of 166 for ground and 170 instead of 166 for air. Regional carriers frequently offer faster times in transit, and provide services such as same-day delivery, Saturday delivery, and postal options similar to FedEx’s SmartPost, UPS’ SurePost and DHL’s Global Mail. Furthermore, because they operate within specific regions, these carriers can offer later pickup times and an expanded next-day delivery area. In comparison, national carriers have a more complicated network to maneuver, and as a result, pickup times may not be as late and a smaller next-day delivery area is offered. Value-added services such as on-call pickup, signature required options, proof of delivery and three-day delivery attempts are also available.

Cons of Regional Carriers Among the biggest of the drawbacks to regional carriers is the lack of national delivery coverage between regions. Regional carriers such as Eastern Connection and

PITT OHIO are doing a very good job of expanding their coverage through partnerships in which they share networks and tracking information. Another large drawback is shippers’ unfamiliarity with these carriers. In fact, according to PARCEL’s 2013 Regional Carriers survey, 70 percent of shippers were not at all familiar or somewhat familiar with the regional carriers, but 64 percent were open to using them. Another concern is service-level differences among regional carriers. For example, there are varying levels of automation and technology capabilities, such as shipping, tracking and reporting levels. While much of this technology is designed to look like what FedEx and UPS provide, the overall functionality may not be the same. Furthermore, some regional carriers may only offer finalmile delivery. In this instance, there may need to be a drop-shipping plan in place depending on the shipper’s distribution center origins. In terms of contracts, sometimes a contractual volume minimum is required. For those shippers also

best practices regional carriers using FedEx or UPS, there may be a loss of discounts from these two national carriers due to contractual revenue tier or earned discount reductions.

Questions to Consider

Regional carriers have coverage of about 85 percent of the United States. Here are some of them: ■■ Eastern Connection: Offers parcel deliveries to the Northeast, Mid-Atlantic and Midwest regions. The company partners with PITT OHIO to assist with delivery within the Midwest region. ■■ Pitt Ohio: Provides similar parcel services in the Midwest by itself and through a partnership with U.S. Cargo, and partners with Eastern Connection to cover the Mid-Atlantic and Northeast, and U.S. Cargo to assist with coverage. ■■ Spee-Dee Delivery: Provides parcel deliveries throughout the North Central U.S. ■■ OnTrac: Is a growing regional carrier that is expanding along the West Coast, the Western states and Northwest regions. ■■ LSO (Lone Star Overnight): Offers services within the Southwest region. ■■ LaserShip: Delivers parcels along the East Coast. ■■ GSO: Provides deliveries in California, Arizona, Nevada and New Mexico. ■■ Hackbarth: Provides final-mile delivery in the Southeast. ■■ UDS: Provides final-mile delivery in the North Central and Midwest.

Once there’s an understanding of the pros and cons of regional parcel carriers, some of the criteria for shippers to consider include: ■■Are rates negotiable? ■■How much volume can move to regional carriers without losing existing FedEx or UPS discounts? ■■What are the minimum volume requirements for a contract? ■■What are the fuel surcharges? ■■What other surcharges are there? well as increased awareness of delivery to work with, happy to run a ■■Are daily pickups provided or is densities and their effect on rates. rate analysis and provide options, drop shipping needed? This communication helps shippers including easy web-based platforms ■■Are residential deliveries offered? make the best decision for parcel to get started with shipping. ■ ■■How does one ship with the movements. regional carriers? Now that FedEx and UPS ■■Is a multi-carrier shipping About the Author: implemented their annual rate platform required? Paul Steiner is vice president of strategic analysis at Spend increases, changed fuel surcharge One of the best ways to determine Management Experts. He’s indices and expanded DIM weight if a regional carrier is the right choice responsible for managing the pricing by eliminating the ground is to provide the carrier with a sample analysis, audit and reporting operations that allow clients to DIM threshold factor, it may be of shipping data and request rate maximize shipping efficiencies. time to look at alternative solutions. examples. This allows them to create Regional carriers are usually easy a profile and plan. At the same time, making FedEx and UPS aware of these discussions may provide better leverage One break when negotiating rates in your quality supply chain with them. Interestingly, could cost you millions. according to the same survey cited previously, most regional carrier users tend to give less than 5 percent of their business to them. In addition to any Scan For Complimentary negotiated leverage, your bottom line. Take a quality leap forward. Supply Chain eBook improved communications Sparta Systems provides a proven platform that manages may also be available via quality-related risk across the enterprise and supplier networks regional carriers. Such to reduce the costs associated with quality events. communications can include Now is the time to gain control of every aspect of your quality better insight into shipping management processes. characteristics and costs, as Visit us at www.spartasystems.com

By Justine Russo

ore companies are adopting sustainability initiatives to help identify areas in which they can reap savings and help improve the environment. Sustainability is becoming a way for companies to understand the practices that reduce waste, which impacts the bottom line and their environmental footprint. Companies are finding that a sustainability program is a great way to communicate their being a good corporate and community citizen. Looking at a carbon footprint can be one of the most common places to start. Carbon dioxide is considered a greenhouse gas (GHG) emission and comes from energy use. By reducing GHG emissions, contaminants that can affect global warming and other air pollutants are reduced. In addition, through understanding and reducing GHG emissions, a company can also reduce energy use and energy costs. When analyzing GHG emissions, there are three areas to consider:

44 Supply & Demand Chain Executive March 2015

How Your Carrier Can Help You Understand Your Carbon Footprint Scope 1: All direct GHG emissions. Direct GHG emissions come from sources that are owned or controlled by the reporting entity. Scope 1 can include emissions from fossil fuels burned on site, or emissions from entity-owned or entity-leased vehicles.

Scope 2: Indirect GHG emissions. Indirect GHG emissions are a consequence of the activities of the reporting entity, but occur at sources owned or controlled by another entity, such as the consumption of purchased electricity or heat.

Scope 3: Other indirect emissions, such as the extraction and production of purchased materials and fuels, transport-related activities in vehicles not owned or controlled by the reporting entity, and other outsourced activities. Most companies start by analyzing Scope 1 and 2 emissions, as they can be directly controlled by changing processes and using alternative energy sources. But understanding Scope 3 emissions can help companies understand their entire carbon footprint and possibly identify opportunities to optimize the supply chain, which can help save money, improve air quality and reduce worldwide fossil fuel dependency. Carriers that measure their carbon output recognize the impact that the smallest improvement in miles per

gallon (MPG) output or reduction in miles driven can have on fuel usage, and therefore, carbon emissions. The easiest way for a carrier to cut down on carbon emissions is by reducing the number of shipments they handle! However, a sustainable carrier is one that is financially stable and can reduce their overall MPG. Carriers can improve MPG performance by recapitalizing equipment or optimizing equipment, and using alternative fuel hybrid equipment. They can improve their total miles driven by optimizing routing and eliminating break-bulks, which reduces unnecessary miles driven and re-handling. Carriers can also improve their carbon emissions by using biodiesel mixes in their fuel. Shippers that understand which of their carriers are measuring carbon emissions and MPG improvement can be assured that these carriers are looking for ways to reduce fuel consumption. These carriers are investing in their companies, their communities and their future. PITT OHIO is always focused on MPG improvement because it makes good business sense. With the implementation of onboard computers, we can calculate not only MPG per power unit, but also the driversâ&#x20AC;&#x2122; shifting, idling and stopping performance, which directly impact MPG. By implementing training and metrics in regard to driversâ&#x20AC;&#x2122; MPG performance, we saw immediate improvement in MPG. In addition, PITT OHIOâ&#x20AC;&#x2122;s vehicle maintenance group has specific programs to

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recapitalize power equipment, which dashboard that our cross-functional means new vehicles with better MPG Sustainability Steering Committee uses to understand how our carbon performance. output is improving and to identify Our operations team makes sure that the right freight goes on the which projects to focus on next. right vehicle. By leveraging our Once a company is measuring straight trucks and sprinter vans, we its carbon emissions, it should see continued MPG improvement. understand how much of those We are also piloting compressed emissions can be allocated by natural gas (CNG) hybrid tractors and trailer skirts “By measuring and identifying to improve MPG, as well carbon sources, you ensure that as trailer racks to improve your company is not just talking the overall freight efficiency. talk (also known as greenwashing), PITT OHIO’s building maintenance team is also but also walking the walk.” reducing energy and water their customers’ shipments. This usage at our terminal locations. It is still not an exact science, but an achieved measurable carbon savings estimate of the total carbon can be by implementing high-efficiency allocated to each customer by using lighting, using waterless urinals and the same methodologies as freight piloting solar panels. In 2014, we costing systems. By having a general opened our first Leadership in Energy understanding of what the customer is and Environmental Design (LEED) shipping (freight class and/or density), certified terminal facility outside of how often they are shipping, the origin Pittsburgh. Working with Dr. Robert and destination of the shipment and Sroufe and Dr. John Mawhinney the weight of the shipment, the carrier from Duquesne University in can calculate the miles the shipment Pittsburgh, we inventoried carbon traveled and the portion of the carbon emission sources and gathered data output of the vehicle to assign to the on a regular basis to understand our shipper. This can assist shippers in monthly carbon emissions. This understanding their Scope 3 emissions. information is now housed, along If a shipper has a private fleet, a carrier with other sustainability metrics, in a

Air Quality Benefits Improving air quality is not only good for the environment, but it’s also good for our health. “One recent study concluded that global warming pollution emissions from human activities may already be causing 1,000 air pollution– related deaths and 20 to 30 additional cancers annually for each 1 degree Celsius rise in temperature in the United States.” Breathing ozone can trigger chest pain, coughing and throat irritation, and worsen emphysema and asthma. Inhaling particulate pollution can result in respiratory illness, cardiovascular disease (heart disease and strokes) and even death. Ozone exposure may cause harm to the central nervous system, and reproductive and developmental harm. (Source: Ozone Basic Information. U.S. EPA/ Particulate Matter. Basic Information. U.S. EPA)

that measures its own carbon may be able to help it understand how to measure its fleet’s carbon output. A shipper may even decide that the carbon output is difficult to optimize based on its company’s priorities, and may choose to outsource its shipments to a carrier that is measuring and reducing carbon output. Taking waste, such as carbon emissions, out of your operations and supply chain means savings. It also means that a company is interested in being a good corporate and community member. Sustainability is also something that your customers may be looking for, especially as they start measuring their own carbon footprint. By measuring and identifying carbon sources, you ensure that your company is not just talking the talk (also known as greenwashing), but also walking the walk. Potentially one of the largest areas for carbon emissions is in the inbound and outbound movement of components and final products. Shippers that are interested in their carbon footprint can ask their carriers if they have a sustainability program and what it entails, if the carrier is measuring carbon emissions or MPG, or if their carrier is a member of the Environmental Protection Agency’s (EPA’s) SmartWay program. SmartWay also has programs for shippers that manage their own fleets. By partnering with carriers, shippers can learn more about their carbon footprint, the impact their freight has on the environment and the benefit of improving that impact. ■

For more information, please visit www.pittohio.com. March 2015 Supply & Demand Chain Executive 45

Xerox—

Keeping Things Moving in the Office and on the Roads Creating value for customers and the environment with game-changing solutions

erox is the world’s leading enterprise for business process and document management solutions and that’s no longer limited to the office. Xerox is working behind the scenes in areas like customer care and transportation. The company is going deep in several industries, like healthcare and financial services, and broad in important business functions like finance and human resources. Since its founding in 1903, the company’s basic principles have remained the same … to invent ways that make work, and life, a little simpler and sustainable. Figure 1, below, illustrates the span of Xerox business today.

Figure 1

Continuing to Enable the Sustainable Enterprise Since its earliest days, corporate citizenship has been part of the company’s core values. Xerox has been 46 Supply & Demand Chain Executive March 2015

placing sustainable products on the market for decades. Xerox researchers develop technologies that minimize the environmental impact of document systems and business processes, while at the same Figure 2 time improve productivity and reduce costs. The decades of sustainable products and services from Xerox are shown in Figure 2. Xerox was a recipient of Supply & Demand Chain Executive magazine’s 2014 Green Award because of the breadth and depth of sustainability in its operations, products and services. At Xerox, sustainability is integrated into key business processes including purchasing, customer service, product design, manufacturing, logistics and transportation. Xerox was an early adopter of Greenhouse Gas reduction targets. In the early 2000s, the company committed to reduce GHGs across its worldwide operations by 25 percent by 2012. By the end of that year, Xerox exceeded a 30 percent reduction.

Xerox believes that the global demand for energy, and the environmental consequences of products used by enterprises and consumers, has elevated market interest in sustainable solutions. Xerox has a tag line, “Xerox helps you focus on what matters most—your real business.” Diane O’Connor, Vice President Xerox Environment, Health, Safety & Sustainability, builds on this tag line by stating, “Many customers are equally delighted when they understand how our products and services help them reach their respective sustainability goals. Innovation is key to delivering on that promise.” Take for example, the Xerox® Digital Alternatives offering announced in November 2014 that enables customers to eliminate paper and significantly reduce their carbon footprint. But did you know a reduced carbon footprint is also made possible with other Xerox services like those in transportation? Innovation continues to be a core strength of the company, as well as a competitive differentiator.

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The aim is to create value for customers, for shareholders, and for employees by driving innovation and enabling sustainability in key areas. Below are some game-changing solutions from Xerox to overcome the challenges of our everyday life that increase costs, stress levels and result in increasing levels of GHG emissions.

Innovation and Research Transforming Data into Actionable Decisions: Competitive advantage can be achieved by better utilizing available information and real-time data. Today, information resides in an ever increasing universe of servers, repositories and formats. The vast majority of information is unstructured, including text, images, voice and videos. One key research area for Xerox is making sense of unstructured information using natural language processing and semantic analysis. Figure 3 Xerox developed an analytics-based engine that dynamically adjusts parking rates based on driver demand for spaces and availability. It models how people choose parking spaces and the flexibility available to drivers about where, when and for how long they stay. The parking engine is integrated as a module into our new Merge® parking management system, which is a single portal for managing Los Angeles’ meters, pay-bymobile phone, sensors, enforcement and collections. Figure 3 provides screenshots of the information that is displayed with Merge®. Studies from UCLA

indicate that the time averages for a motorist in Los Angeles searching for a parking space ranges from 3.5 to 14 minutes, depending on time of day. This consumes 47,000 gallons of gas and produces 730 tons of carbon dioxide in Los Angeles on an annual basis. With a solution such as Merge®, fuel consumption and emissions of GHG are greatly reduced. Creating Agile Business Processes: Businesses require agility to quickly respond to market changes and new business requirements. To enable greater business process agility, Xerox research strives to simplify, automate and enable business processes on the cloud via flexible platforms that run on robust and scalable infrastructures. Xerox is adapting its expertise in imaging to the area of Computer Vision. The ability to extract and analyze vast amounts of information from videos and images touches areas as diverse as surveillance,

healthcare, education, transportation, environmental sciences and reading written records. In transportation, researchers have developed a highspeed, video-based license plate recognition technology that is 99 percent accurate. It automates highway toll collection and reduces wasteful fuel consumption because the vehicle is no longer idling when paying the toll.

Building on 75 Years of Innovation The core of the Xerox story is based on the premise that we live in an age where technology is producing transformative change, enabling businesses big and small to accomplish more than could have been dreamed possible decades ago. Xerox believes it’s in a strong position to capitalize on market opportunities and deliver on our commitment to create value for all our stakeholders. Xerox points to its Services business as a beacon for its path forward; its Document Technology business as the fuel that allows growth; its culture of innovation that permits big thinking; commitment to delivering earnings expansion; and managing cash in a way that’s building value for you for years to come. Chester Carlson was on to something 75 years ago. And today, Xerox employees continue to believe their purpose is to simplify how work gets done. Quoting Xerox CEO Ursula Burns, “When we do just that in smart, innovative ways, we’ll help the world work a little better … for the next 75 years.” ■

For more information, please visit www.xerox.com March 2015 Supply & Demand Chain Executive 47

industry focus transportation

Getting a Handle on Global Transportation Spend Can Drive Growth in 2015 By Ajesh Kapoor

Transportation spend is the second highest supply chain cost (and the highest indirect cost) businesses face, second only to the direct cost of goods. Margins are decreasing everywhere as supply chains expand and twist in complicated and expensive ways around the globe. Demand is more volatile than ever, and we cannot rely only on traditional sales and marketing efforts to maintain growth. Today’s leaders are looking to supply chain expertise as a means to differentiate offerings and enhance customer experiences. This paradigm shift is driving supply chains to become more agile, responsive and risk-proof. Despite transportation spend being such a huge cost factor, there is limited effort to reduce it, primarily because, in most organizations, it gets distributed across multiple silos. Organizations look to transportation management systems (TMSs) to address transportation spend within these silos. A TMS automates transportation processes and tries to find the most cost-effective ways to transport goods from one location to another. But traditional TMS technology imposes limits on how much cost we can take out and does not even begin to address supply chain agility and responsiveness. A traditional TMS operates in silos inside individual organizational boundaries or geographic regions. The technology model renders it incapable of cutting across divisions, whether internal (between sourcing, transportation operations and accounts payable), regional (between states, countries or blocs) or external (between suppliers, logistics providers and carriers). 48 Supply & Demand Chain Executive March 2015

Traditional TMSs create pockets of savings, but don’t reduce costs across the entire supply chain. Silos create conflicts of interest between parties, and costly blind spots in which goods are invisible and out of direct control: Sourcing optimizes for reliability, while finance focuses on cost. It’s practically impossible to adjust to any sudden events like a natural disaster, political turmoil or a demand change. However, two shifts are changing global transportation management: 1. Supply chains are becoming increasingly complex, relying on partners and data beyond the four walls of the enterprise. 2. The definition of global transportation management is expanding beyond traditional TMSs.

Creating a Common Foundation for the Agile Supply Chain When companies expand, they often work with new suppliers, serve new regions and sell to a more diverse set of customers. New customers have different needs and expectations, and

expansion usually results in a more diverse and complex technology footprint. The result is a complex supply chain tasked with keeping up with the unpredictable surpluses, shortages and demand volatility inherent in today’s global markets. How do you maintain control in such overwhelming market conditions? The strongest supply chains are the ones that are most agile. The ability to make quick adjustments based on fluctuations in supply and demand can help avoid disruptions, maintain profitability and set a manufacturer apart from the competition. Companies today need a foundation for connecting different parts of their supply chains.

Using Communities to Bridge Partitions Enterprises require structures to address functional needs, take advantage of different skill sets, expand geographically or grow into multiple product lines. This evolution creates natural partitions

within an enterprise to function efficiently. As organizations grow, these structures grow in complexity and partitions lead to barriers restricting information flow across an enterprise. This impacts procurement, warehouse management, transportation management, demand planning, inventory planning, supply planning and more. Transportation management may be partitioned by geography, business unit, mode or the part of the supply chain it addresses. Multi-enterprise business processes add another dimension to this structure. For example, a company’s supply chain extends into other organizations for its strategic, operational and information needs. In fact, today’s supply chain draws close to 80 percent of its information from outside the enterprise. These supply chain partners—suppliers, manufacturers, logistics service providers, transportation carriers, financial institutions—play different roles in the global supply chain. They have different interests and partitions, and are more likely to create barriers. All the same, they need to share information and collaborate to build a successful supply chain.

Customer Experience from a Global View of Supply Chain Customer experience was not always a focus, but is considered a competitive differentiator today, though there are different interpretations of it. A manufacturer associated it with all the items on an assembly line reliably showing up together. A retailer thought about it in terms of the shelf being stocked, or a customer getting a package delivered on time and in good condition. This definition, and customer expectations, expanded substantially over the past few years. It starts with

the ordering process when a customer expects a reliable projection of when the product is going to be delivered, along with options for changing the delivery schedule. Customers also expect to receive updates at every stage, whether the estimates change or not. A big part of customer experience, and the most commonly overlooked, is our ability to manage exceptions. Keeping the schedule is as important as communicating with the customer. The fulfillment process in today’s omni-channel supply chain is complex, and goes all the way from the storefront to the distribution center and back through the supply chain. Fulfilling an order can take from 5 to 15 handoffs. Exceeding customer expectations requires every part of the supply chain, irrespective of the group and its role, to operate the same way and on a common platform.

Managing All Domestic and International Transport Together Today’s transportation management systems are specialized and largely geographically limited, mostly managing land-based transportation within North America or western Europe. Other geographies, as well as international transportation, are not the focus of transportation managers or TMS applications. There is general agreement on the need to address these gaps to enable agile and responsive supply chains. Various enterprises, logistics service providers and industry analysts envision a single ubiquitous logistics network in which an organization can plug in once, and access all of its partners and data. Many TMS providers advise to focus on domestic first, but what does that mean? Transportation operations in North America, western Europe, South America and Asia-Pacific

have very different requirements. Most applications focus on domestic U.S. geography, while a smaller number addresses western European operations with some limitations. They are operating in silos. Even when they address the functional requirements of other geographies, they stay too expensive to justify an implementation in a silo. These gaps highlight the need for a single view, connecting all domestic and international transportation through a common foundation.

Redefining TMS Key to this broader global approach to TMS is establishing an end-to-end supply chain layer that all existing applications can plug into. This delivers a single platform for sharing data, regardless of region or mode. The data is integrated, and each executive can use data in the required format. Most importantly, different messages from partners, and supply updates from carriers or suppliers are captured. Anything happening in the supply chain that impacts a customer shipment resides inside that layer. This is true end-to-end visibility through a supply chain control tower. The difference in this approach is that companies don’t have to build, standardize or replace applications and partners. TMS in a cloud-based layer brings together all supply chain applications and partners, and integrates the data flow to empower all users. Barriers that existed around international and domestic transportation fade, silos are dissolved and a global TMS takes shape. ■ About the Author: Ajesh Kapoor is the vice president of transportation management solutions at GT Nexus.

March 2015 Supply & Demand Chain Executive 49

professional development economies of scale

Lessons from a Pin Factory What the Scottish Enlightenment can teach small- to medium-sized companies about economies of scale By Amanda Menking

n a world in which even small to mid-sized manufacturers use robots, lasers and cutting-edge computing to make their products, it may seem surprising that they could still learn something valuable from a pin manufacturer that operated nearly two and a half centuries ago. But they definitely can. These days, one doesn’t have to be an enormous company to benefit from economies of scale. In 1776, the western world was recovering from the Seven Years’ War. Britain was emerging as a global power, gaining control of the seas and tightening control of the American colonies. Scotland, though still largely devoted to agriculture and defined by economic inequality, invested heavily in the tobacco trade in Virginia and, consequently, was enjoying new wealth while ushering in an age of progress known as the Scottish Enlightenment.

David Hume, a Scottish philosopher, historian, diplomat and essayist, was a leading figure in the Scottish Enlightenment—influencing thinkers such as William James, Immanuel Kant, John Locke and his contemporary Adam Smith. In Hume’s definitive work, A Treatise of Human Nature, he explores how the sciences, arts, religion and philosophy are all dependent upon the “science of man,” arguing that desire—rather than reason—guides human behavior. Hume introduced a radical kind of empiricism, proposing that humans do not have innate ideas, but rather attain knowledge and understanding only through experience. Adam Smith, like Hume, believed that human nature is largely shaped by experience; however, Smith emphasized the importance of social interactions and self-interest. Smith is often referred to as the “father of free markets,” but is much more accurately

the “father of economics.” In one of the most well-known and often quoted sections of The Wealth of Nations, Smith describes a pin factory: One man draws out the wire; another straights it; a third cuts it; a fourth points it; a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations; to put it on is a peculiar business; to whiten the pins is another; it is even a trade by itself to put them into the paper; and the important business of making a pin is, in this manner, divided into about eighteen distinct operations, which, in some manufactories, are all performed by distinct hands, though in others the same man will sometimes perform two or three of them. I have seen a small manufactory of this kind, where 10 men only were employed, and where some of them consequently performed two or three distinct operations. But though they were very poor, and therefore but indifferently Results Through Applied Intelligence® accommodated with the necessary machinery, they Industries JVKellyGroup, Inc. provides cost reduction and risk mitigation solutions for JVKellyGroup has worked could, when they exerted some of the world’s largest organizations. By offering an integrated set of with some of the world’s largest organizations across multiple themselves, make among them analytics, sourcing services and technology, JVKellyGroup helps ensure that industries including: a company’s spend is effectively analyzed, sourced, managed, and monitored. » Financial Services about 12 pounds of pins in » Pharmaceuticals a day. […] But if they had Why JVKellyGroup, Inc.? » Manufacturing Clients benefit from the expertise of years of experience our consultants have in actual sourcing » Automotive all wrought separately and roles including former CPOs, VPs of Procurement and Sourcing, Buyers, Analysts and Sourcing » Business Information Technology Developers. » Government/Public Sector independently, and without » Retail Our services will help decrease sourcing cycle time, increase potential savings capture due to any of them having been expertise in commodity areas as well as improve supplier relationships and mitigate supplier risk. educated to this peculiar Experience business, they certainly could With a team of professionals, averaging more than 15 years of hands-on, industry experience, our projects provide practical solutions and quantifiable benefits. JVKellyGroup has led engagements not each of them have made across a diverse range of industry verticals and worked with virtually every category of indirect spend. twenty, perhaps not one pin in a day […]. CONTACT US TODAY! phone: 631-427-2888

email: info@jvkg.com

web: www.jvkg.com

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FOR THE SDCE 100 AWARDS

Is your company doing award-worthy work? Then enter the Supply & Demand Chain Executive 100 Great Supply Chain Projects competition. The SDCE 100 spotlights and honors successful and innovative transformation projects that deliver bottom-line value to small, medium and large enterprises across the range of supply chain functions and issues that this industryâ&#x20AC;&#x2122;s professionals face today. Winners will be announced on SDCExec.com and in the SDCE June 2015 issue.

ENTER YOUR PROJECT AT SDCExec.com/awards Nomination Deadline: April 10, 2015

professional development economies of scale Here Smith introduces division of labor and explains how a pin factory—even a small one—might produce more pins than a single man can simply by relying upon the specialization of skills and a cumulative process of discrete tasks. Perhaps remarkably, Smith’s observations about a pin factory in 1776 directly influence how we think about and conduct business today. In fact, the ideas of mass production and economies of scale—things we often take for granted—were borne more than 200 years ago out of The Wealth of Nations. Prior to mass production, items were made to order. Craftspeople met customers’ needs, wants and desires upon demand; they did not create products with the hopes of selling them at a later date. But Smith’s writings, coupled with early experimentation with interchangeable parts by gunsmiths like Honoré Blanc and Eli Whitney, quickly shifted paradigms, giving rise to assembly lines, the employment of both highly skilled and relatively unskilled laborers, and reduced costs. Automated machines replaced handmade, hand-powered tools and new fuel sources, such as steam and coal, revolutionized our understanding of power. As mass production spread, manufacturers rather than customers began to shape the market. Large factories mastered economies of scale, sourcing materials at lower costs, and buying and producing in bulk. Industry quickly overtook agriculture, and by the early 20th century, though the Industrial Revolution began in Britain, the United States—long free of British control—was the world’s leading industrial nation. Today, however, we live in an information—rather than an industrial—age. As Eric Schnurer writes, “In the industrial era, 52 Supply & Demand Chain Executive March 2015

society learned that economies of scale produce the most efficient outcomes. But what we learned in the information age is that individualized solutions are more effective and often cheaper, too.” While many large

however, have the capability to predict aggregate usage for all components across all products automatically. As a result, companies can order these common parts in bulk, secure in the knowledge that they didn’t order too many “In the industrial era, society learned that and that economies of scale produce the most efficient they can’t be caught outcomes. But what we learned in the short. The information age is that individualized solutions savings from applying are more effective and often cheaper, too.” this kind — Eric Schnurer of insight manufacturers continue to benefit can really add up, turning pennies from economies of scale, small to into dollars and, for some companies, medium-sized companies are learning turning dollars into millions. that the information age presents While Hume believed that people them with a unique advantage to learn only from experience, Voltaire leverage both product and process asked, “Is there anyone so wise as to data so that they can offer their learn by the experience of others?” customers effective, individualized Smaller companies can learn from solutions at reduced costs. What they Smith’s story of the pin factory by may not realize is that they, too, can remembering the importance of leverage economies of scale by making making both process and product visible existing information. data visible across the organization. Companies of all sizes know the We are often quick to recognize total, aggregated costs of the most when employees and teams start to expensive components they use, work in silos, but we may be slower but they may not pay attention to to recognize when we unintentionally common, inexpensive parts—such tucked our resources away. Modern as plastics, capacitors, resistors and cloud-based PLM systems can help screws (perhaps even pins)—that are surface even the least expensive essential to almost all of the products and most common component they make. It isn’t easy to calculate and usage automatically so that small predict usage of low-cost components, to medium-sized companies can and it’s certainly not worth assigning enjoy the same costs savings as larger valuable resources to manually account companies, and focus their time for usage. Therefore, individual product and attention on continued product teams often order just the parts they innovation rather than picking up need for themselves. Modern product dropped pins. ■ lifecycle management (PLM) systems, About the Author: Amanda Menking works in product marketing at Arena Solutions and is a third-year PhD student at the University of Washington Information School. She’s currently exploring gendered labor in online spaces. Menking is also a Wikimedia Foundation Individual Engagement Grant recipient and is researching the gender gap in the English language Wikipedia. Prior to starting her PhD, she taught high school in both Washington State and Namibia, taught community college in Texas, and worked in software for almost five years.

Here are a few of this yearâ&#x20AC;&#x2122;s supply chain leaders . . . Jake Barr

Steve Lykken

CEO BlueWorld Supply Chain Consulting

Vice President of Customer Solutions E2open, Inc.

Erwin Hermans

Jim Monkmeyer

Vice President Supply Chain Managed Services, Celestica

Dave Lindeen

Senior Vice President of Sales Corcentric

For more Pros, turn to Page 8.

Vice President, Supply Chain England Logistics

Donna Troy

Executive Vice President and General Manager, ERP Americas Epicor Software

Gene Averill

Bill Harrison

Jeff Sovelove

President Demand Solutions

Director of Implementation eZCom Software

Joe Averill

Steven L. Schuman

Peter Edlund

President and CEO Avercast

CIO Avercast

Kevin Hoyle

CEO/Managing Director B2BGateway.Net

Martin Jack

Chief Technology Officer Barcoding, Inc.

Esa TihilĂ¤ CEO Basware

Chief Procurement Officer DG3 North America

Executive Vice President of Product Marketing DiCentral

Thuy Mai CEO DiCentral

Geoff Annesley

General Manager, Semiconductor E2open, Inc.

Pawan Joshi

Vice President, Strategy E2open, Inc.

Robert H. Barrett

Advisory Managing Director KPMG

Pam Lopker

President and Chairman of the Board QAD

Cliff Otto

CEO Saddle Creek Logistics Services

Lennox Supply Chain Distribution Operations Leadership Team

Dan Swartwood

Lennox Supply Chain Leadership Team

Joey Benadretti

Vice President, Process and Technology Satellite Logistics Group (SLG)

President SYSPRO USA

Mike Edenfield

Rick Morris

President and CEO Logility

CEO Thrive Technologies Inc.

Sergio Retamal

Daniel Clarahan

President and CEO Global4PL Supply Chain Management

Senior Solutions Consultant NeoGrid

Tom Mann

Brian Miller

Michael Williams

Vice President of Services Intesource

Senior Solutions Consultant NeoGrid

Padman Ramankutty

Michael Morris

CEO Intrigo Systems

Global Supply Chain Process Leader Owens Corning

Ryan Sheehan

Aman Mann

CEO Invata Intralogistics, Inc.

Chris Jones

Vice President, Consulting Services Junction Solutions

CEO and Co-Founder Procurify.com

Meredith Marshall

Procurement Implementation Manager Puridiom

President TrakLok

Troy Ryley

Managing Director, Mexico Transplace

Eric Lail

Vice President, Client Services Transportation Insight

Scott Nelson

Founder and CEO Trax Technologies

Index of Advertisers

Amber Road, Inc.. . . . . . . . . . . . . . . . . . . . . 7

companies. CaseStack provides sustainable logistics, including transportation and warehousing solutions that eliminate systemic waste and optimize supply chain performance.

Fortna Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . 16

Amber Road is a leading provider of cloud-based global trade management solutions. We automate import and export processes to enable goods to flow across international borders in the most efficient, compliant and profitable way.

Corcentric. . . . . . . . . . . . . . . . . . . . . . . . . . 21

GT Nexus

www.amberroad.com Fariba Ahdoot • 703-342-5877 solutions@amberroad.com

Ariba, an SAP company. . . . . . . . . . . . . . 11 www.ariba.com Karen Master • 412-297-8177 • karen.master@sap.com

Ariba—an SAP company—is the world’s business commerce network. Ariba combines industry-leading cloud-based applications with the world’s largest web-based trading community to help companies discover and collaborate with a global network of partners.

Baxter Planning Systems. . . . . . . . . . . . . 20 www.bybaxter.com Phillip Kennedy • 512-323-5959 • info@bybaxter.com

Baxter Planning Systems provides inventory planning software and services that help improve customer service and reduce costs. See why Fortune 500 enterprises and growing startups like Carestream Health, Kawasaki, NetApp, Nutanix and Palo Alto Networks rely on Baxter: Visit www.bybaxter.com.

Blue Ridge . . . . . . . . . . . . . . . . . . . . . . . . . 12 www.blueridgeinventory.com Patrick Ford • 404-988-9286 patrick.ford@blueridgeinventory.com

The Blue Ridge Supply Chain Planning Cloud transforms the bottom line of retailers, distributors and manufacturers with powerfully precise forecasting, planning and optimization technology, built from the ground up to maximize efficiency and effectiveness.

C.H. Robinson. . . . . . . . . . . . . . . . . . . . . . . . 2 www.chrobinson.com 800-323-7587 • solutions@chrobinson.com C.H. Robinson helps companies simplify their global supply

chains and understand their landed costs. To help build smarter, more competitive supply chains, skilled supply chain engineers and logistics professionals combine a deep knowledge of market conditions, practical experience and proven processes.

CaseStack. . . . . . . . . . . . . . . . . . . . . . . . . . 13 www.casestack.com Business Development Team • 855-638-3500 consolidation@casestack.com

CaseStack is a leading supply chain services provider that leverages collaborative retailer consolidation programs and cloud-based technology for consumer packaged goods (CPG)

www.corcentric.com Mike Ruhl • 856-382-4741 • mruhl@corcentric.com

Corcentric makes business-to-business (B2B) commerce faster, simpler and more transparent by helping customers automate and streamline both order-to-cash and procure-topay processes. Call Corcentric for a comprehensive, end-toend solution for maximum efficiency and savings.

Demand Solutions. . . . . . . . . . . . . . . . . . . 24 www.demandsolutions.com Paige Lape • 314-991-7120 plape@demandsolutions.com

DSC Logistics. . . . . . . . . . . . . . . . . . . . . . . 29 www.dsclogistics.com Jennifer Nix • 847-390-6800 customersolutions@dsclogistics.com

DSC Logistics is a leader in transforming logistics and supply chain management into a critical business strategy based on collaborative partnerships, innovative thinking and high-performance operations. DSC achieves the business goals of Fortune 500 and other dynamic companies by designing, integrating, managing and adapting customized supply chain solutions.

E2open, Inc.

www.fortna.com Kate Baar • 770-475-0991, ext. 1201 • katebaar@fortna.com www.gtnexus.com Mark Mirsky • 510-808-2222 • information@gtnexus.com

GT Nexus provides the cloud-based collaboration platform that leaders in nearly every sector rely on to automate hundreds of supply chain processes on a global scale, across entire trade communities.

Insight Sourcing Group . . . . . . . . . . . . . . 25

www.insightsourcing.com Josh Stancil • 770-628-0030 • jstancil@insightsourcing.com

JVKellyGroup, Inc.. . . . . . . . . . . . . . . . . . . 50 www.jvkg.com Aldo Forlini • 631-427-2888, ext. 40 • aforlini@jvkg.com

Loftware . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 www.loftware.com Jessica Seeley Plourde • 603-570-4663 jseeley@loftware.com

Logility, Inc. . . . . . . . . . . . . . . . . . . . . . . . . 22 www.logility.com Lee White • 800-762-5207 • info@logility.com

MMI (Shanghai) Co., Ltd.. . . . . . . . . . . . . . 3

www.e2open.com 650-645-6500 • e2open_us@e2open.com

www.mmi-shanghai.com/en/ +86 21 2020 5500 • info@mmi-shanghai.com

Emirates SkyCargo. . . . . . . . . . . . . . . . . . 54

NeoGrid

From Emirates SkyCargo’s location at the crossroads of Europe, Africa and Asia—you can reach more than one and a half billion customers in less than eight hours with multiple destinations and a young, wide-bodied fleet.

Old Dominion Freight Line, Inc. . 15, 17, 19

www.skycargo.com

Entercoms, Inc.

www.entercoms.com Rosalind Bell • 469-533-1875 • contact@entercoms.com Entercoms drives rapid time-to-value and lasting impact to the performance of service operations by optimizing aftermarket and service supply chains through analytics and operations expertise powered by a proprietary technology platform. Learn more at www.entercoms.com.

enVista. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 www.envistacorp.com 877-684-7700 • info@envistacorp.com

www.neogrid.com Yvette Quintanar • 888-709-0018 • info@neogrid.com

Reed Exposition. . . . . . . . . . . . . . . . . . . . . 53 www.lscexpo.com

Saia, Inc.. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

www.saia.com Jeannie Jump • 770-232-4069 • jjump@saia.com Saia, Inc. offers a range of less-than-truckload, non-asset truckload and logistic services through three service groups, the primary of which operates 147 terminals in 34 states, and is home to the industry-exclusive Customer Service Indicators and Xtreme Guarantee.

SAP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

www.sap.com Emily Rakowski • 202-386-1102 • emily.rakowski@sap.com As market leader in enterprise application software, SAP helps companies of all sizes and industries run better. SAP applications and services enable more than 282,000 customers to operate profitably, adapt continuously and grow sustainably. www.sig.org Sarah Holliman • 510-379-4707 • sholliman@sig.org

Sparta Systems, Inc.. . . . . . . . . . . . . . . . . 43 www.spartasystems.com Adam Berman • 609-807-5100 adam.berman@spartasystems.com

Transplace . . . . . . . . . . . . . . . . . . . . . . . . . 23

www.transplace.com Jennifer Cortez • 972-731-4525 jennifer.cortez@transplace.com Transplace is a non-asset, North America-based provider offering manufacturers, retailers, and chemical and consumer packaged goods companies the optimal blend of logistics technology and transportation management services.

Trax Technologies, Inc. . . . . . . . . . . . . . . 14

Old Dominion Freight Line is a leading less-than-truckload (LTL) carrier with more than 225 service centers nationwide. Contact Old Dominion for a quote at www.odfl.com or 800-235-5569.

www.traxtech.com Joshua Molina • 480-556-8700 inforequest@traxtech.com

PITT OHIO. . . . . . . . . . . . . . . . . . . . . . . . . . 44

Warehousing Education and Research Council (WERC). . . . . . . . . . . . 37

Port Logistics Group. . . . . . . . . . . . . . . . . 36 www.portlogisticsgroup.com Jeff Wolpov, CCO • 973-249-1230, ext. 1171 info@portlogisticsgroup.com

Global Solutions for Supply Chain ROI

Sourcing Interests Group (SIG). . . . . . . . 40

www.odfl.com 800-235-5569 • customer.service@odfl.com

works.pittohio.com 800-366-7488

The Global Enabled Supply and Demand Chain Map A map with the solutions and services that will give your supply chains a competitive edge

www.werc.org

Xerox Corp.. . . . . . . . . . . . . . . . . . . . . . . . . 46 www.xerox.com 262-784-8726

Version 29.0

Procurement (Direct, Indirect & Services)

Global Solutions for Supply Chain ROI

The Global Enabled Supply and Demand Chain Map

Version 29.0 (This map replaces Version 28. 0 from the September 2014 issue)

• Benchmarking & Metrics • Content Management • Contingent & Temporary Labor Services Management • Enterprise Supplier Collaboration • Employee Business Services Management [including Travel & Entertainment (T&E)] • Financial Fraud (NEW) • Group Purchasing Organizations & Solutions • Hedging Strategies • Marketplaces • Negotiations & Contract Management

• New Laws & Regulations (NEW) • Product Cost Management • Purchase Order & Requisition Management • Supplier Enablement & Supplier Information Management • Supplier Performance Measurement & Monitoring • Supplier Relationship Management & Supplier Development • Supplier Risk Management • Sustainable & Green Supply Management • Value-Focused Supply Management

• • •

• Internal/External Portals • Network Infrastructure Enterprise Data Management & Data Synchronization • Regulatory & Customer Mandate Compliance, Governance Issues • Security • Solutions Portfolio Management: On-premises/ Cloud-based/Software-as-a-service (SaaS)/ On-demand/Hosted Applications (ASP) • Warehouse Management Systems (WMS) (NEW) • Wireless Applications & Devices

Supply Chain Integration & Technology Infrastructure Enablers Amber Road, Inc. Ariba, an SAP company Baxter Planning Systems C.H. Robinson CaseStack Corcentric

Demand Solutions DSC Logistics E2open, Inc. Fortna Inc. GT Nexus Loftware

NeoGrid Port Logistics Group SAP Sparta Systems, Inc. Transplace Trax Technologies, Inc.

GT Nexus Insight Sourcing Group JVKellyGroup Inc. SAP Sourcing Interests Group (SIG) Sparta Systems, Inc. Transplace Trax Technologies, Inc.

• Benchmarking & Metrics • Capacity Planning • Demand Planning & Forecasting • Demand Sensing & Shaping • eRFI/eRFP • Merchandise Planning • Network Analysis & Optimization • New Laws & Regulations (NEW) • Order & Demand Management

• • • • •

utsourced Manufacturing O Predictive Analytics Promotional Planning Quote-to-order Automation Sales & Operations Planning (S&OP)/Sales, Inventory & Operations Planning (SIOP) • Supply & Demand Chain Network Design • Supply Chain & Production Planning • Supply Chain Coordination & Event Management

Sourcing Enablers Amber Road, Inc. Ariba, an SAP company C.H. Robinson Demand Solutions DSC Logistics E2open, Inc. GT Nexus Insight Sourcing Group

JVKellyGroup Inc. Logility, Inc. NeoGrid SAP Sourcing Interests Group (SIG) Sparta Systems, Inc. Transplace

Supply Chain Integration & Technology Infrastructure

Order/Demand Capture

Collaborative Design Design for Supply Chain Design for Sustainability & Environment New Laws & Regulations (NEW) New Product Introduction Outsourced Design Services Product Data Management Product Portfolio Management Request for Information Reverse Logistics Sustainable Packaging

Product Lifecycle Management Enablers Baxter Planning Systems DSC Logistics E2open, Inc. JVKellyGroup Inc. Logility, Inc. SAP Trax Technologies, Inc.

•

Logistics

g na

Order/Demand Capture Enablers

Product Lifecycle Management

• •

Customer Relationship Management

u od

e Lif

Service

e em

Education

E2open, Inc. Fortna Inc. GT Nexus Logility, Inc. NeoGrid SAP

Benchmarking & Metrics CO2 Tracking & Management Customized Build & Assemble Cyber Security (NEW) Dashboards Distribution Planning & Distribution Requirements Planning Energy/Sustainability Assessment Financial Fraud (NEW) Global Trade Management Inventory Management & Optimization Lean Six Sigma Logistics Resource Management Manufacturing Execution Systems Material Handling Equipment & Services Modeling Simulation Order Management Inputs (from Order/Demand Management Pie) Outsourcing Services

Service Supply Chain • Service Analytics, Planning & Optimization • Service Financial Management

Payment

• Reverse Supply Chain & Logistics & Returns Management • Route Accounting & Management & Direct Store Delivery Solutions • Order & Delivery Management • Service Parts Logistics & Service Supply Chain Planning • Simultaneous Outbound & Inbound Management • Supply Chain Event Management • Supply Chain Execution • Supply Chain Security • Transportation Management & Optimization • Vendor-managed Inventory (VMI) • Voice-driven Solutions • Warehouse Control Systems • Warehouse Management Services & Systems • Workforce Management • Workforce Training

Amber Road, Inc. Baxter Planning Systems Blue Ridge C.H. Robinson CaseStack Demand Solutions DSC Logistics E2open, Inc. Fortna Inc. GT Nexus Loftware Logility, Inc. NeoGrid Old Dominion Freight Line, Inc. PITT OHIO Port Logistics Group Saia, Inc. SAP Transplace Trax Technologies, Inc.

• Service Operations across Aftermarket Service Supply Chain Areas: Asset Management, Spare Parts, Service Enablers Field Services, Warranty, Service Baxter Planning Management, Repairs & Returns Systems

Entercoms, Inc.

Payment • Collaborative Cash Flow Management • e-Credit • Electronic Bill Presentment & e-Invoicing • Electronic Funds Transfer & All Forms of e-Payment • e-Money • Financial Fraud (NEW)

• Financial Supply Chain Management • Financial Transaction Management (All Request-to-check Processes) • Freight Audit & Payment Services • Global Trade Finance • Letters of Credit • PayPal • Purchasing Cards • Spend Data Management

Payment Enablers Ariba, an SAP company Corcentric GT Nexus Logility, Inc. NeoGrid SAP Trax Technologies, Inc.

Decision Support Circles Consulting Customer Relationship Management

• • • • • • • • • • •

e cl

• • • •

Fulfillment

Sourcing

Baxter Planning Systems Blue Ridge CaseStack C.H. Robinson Demand Solutions DSC Logistics

• • • •

Procurement

ing

• Automatic Identification & Data Capture (RFID & Voice) • B2B Connectivity Standards & Integration Planning • Contingency Planning • Cyber Security (NEW) • Electronic Data Interchange (EDI) • Enterprise Asset Management (EAM) • Enterprise Application Integration (EAI) • Enterprise Resource Planning (ERP) • Hardware Options • Import/Export Compliance Management

Procurement Enablers Amber Road, Inc. Ariba, an SAP company Blue Ridge CaseStack Corcentric Demand Solutions DSC Logistics E2open, Inc.

sult

(Lean Manufacturing, MRP, Just-in-time, Just-in-sequence Planning, Collaborative Production Management)

• • • • • •

Con

• • • • • • •

Order/Demand Capture

Supply Chain Integration & Technology Infrastructure

Fulfillment/Logistics

Sourcing

• Performance • Spend Analytics, Product Cost Auctions Management & Supply Category Management Strategy Commodity Team & Supplier • Sustainable & Green Supply Collaboration Management Compliance • Supplier Relationship Management Content Management • Tail Spend Management Financial Fraud (NEW) • Total Cost of Ownership/ Governance Best Value Market Analytics • New Laws & Regulations (NEW) Trading Exchanges (Public & Private) Outsourced Manufacturing/ • Total Cost Analysis Offshore-Nearshore-Onshore Strategies

Fulfillment/Logistics Enablers

• Channel Management & Customer Analytics • Contest Management • Field Service & Service Parts Logistics • Mobile Sales Solutions • Reverse Logistics & Material &/or Merchandise Returns

• Sales Force Automation • Trade Promotion Management • Warranty Chain Management

Customer Relationship Management Enablers Baxter Planning Systems C.H. Robinson DSC Logistics NeoGrid SAP Sparta Systems, Inc. Trax Technologies, Inc.

Continuing Education Units (CEUs) • • • •

Accreditation Associations Certification Universities

Continuing Education Units Enablers Sourcing Interests Group (SIG)

Consulting Enablers Ariba, an SAP company Baxter Planning Systems C.H. Robinson DSC Logistics enVista Fortna Inc. Insight Sourcing Group SAP Transplace

• Benchmarking & Metrics • Business Process & Performance Management; & Revenue, Price & Profit Management Automation • Dashboards • Information Sharing & Analysis; Knowledge Management & Enterprise Business Intelligence; & Six Sigma, Quality & Lean Six Sigma • Inter-enterprise & Cross-functional Collaboration; Change Management; Staffing & Incentive Management; Supply Chain Skills Management & Education; & Professional Development • Market Intelligence/Analytics • Regulatory & Customer Mandate Compliance; Governance Issues; Supply Change Risk Management; & Supply Chain Relationship Management • Research, Advisory & Consulting

Decision Support Circles Enablers Amber Road, Inc. Ariba, an SAP company Blue Ridge C.H. Robinson Demand Solutions DSC Logistics E2open, Inc. GT Nexus NeoGrid SAP Sourcing Interests Group (SIG) Sparta Systems, Inc. Trax Technologies, Inc.