Supply & Demand Chain Executive June 2016

SPECIAL REPORT: CPOS IDENTIFY PROCUREMENT’S TOP CHALLENGES

JUNE 2016

RAIL PICKS UP STEAM

Rail and intermodal make infrastructure investments and efficiency improvements

3PLS DRIVE INDUSTRY CHANGE

Third-party logistics navigates through continuous change, rigorous regulations and greater customer demands

CHART YOUR COURSE The 2016 Supply & Demand Chain Executive 100 will help you innovate and problemsolve your way to supply chain success

Fresh new content daily at SDCEXEC.COM

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100 GREAT SUPPLY CHAIN PROJECTS This year’s Supply & Demand Chain

Executive (SDCE) 100 highlights supply chain solution and service providers that are working with small, medium and

large enterprises to transform their supply

chains and deliver value to the bottom line.

These leaders are helping their customers

meet the challenges of the new normal— and providing a blueprint for successful supply chain transformation.

TM

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June 2016 | Volume 17 | Issue 3

CONTENTS FEATURE

20 3PL STATE OF

EXECUTIVE FOCUS

CHART YOUR COURSE TO SUPPLY CHAIN SUCCESS

The 2016 Supply & Demand Chain Executive 100 charts a course that overflows with innovation and solutions to mimic to maximize efficiency, profitability and more.

ON THE COVER

THE INDUSTRY 3PLs Driving Industry Change

34 T RANSPORTATION Rail Picks Up Steam

Rail and intermodal are supporting the supply chain with investments.

3PLs must move in the direction of industry trends to navigate continuous change.

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36 WAREHOUSING The Case for Warehouse Automation

SPECIAL REPORTS

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Warehouse automation solutions improve operational speed and productivity.

26 THE INTERNET OF THINGS Climbing the IoT Mountain

Photo Credit: Cynthia Y. McCann

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The IoT ascent requires manufacturers to take a stepped approach to implementation.

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28 PROCUREMENT Shake Off the Caveman Mentality

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There’s no room for a Neanderthal approach to procurement.

32 TRADE

FINANCE EXIM Bank Looks to Prove its Worth

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The U.S. ExportImport Bank is keen on showcasing its value to big and small firms alike.

& TECH ERP Offerings Become More Versatile

Cloud and SaaS ERP deliver faster and easier access for enterprise customers.

42 PROFESSIONAL DEVELOPMENT Education These colleges and universities offer supply chain degrees.

COLUMNS

04 EXECUTIVE MEMO 24 MADE IN AMERICA 44 WORK HARD,

PLAY HARD

Exclusive online features and solutions for successful supply chain operations

Leveraging Business-toBusiness E- and M-Commerce as Competitive Differentiators

Five Tenets to Ease the Journey Your Product Return Policy of Rising Procurement Relevance Can Determine Global and Global Complexities E-Commerce Success

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38 SOFTWARE

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EXECUTIVE MEMO

By Ronnie Garrett, Editor rgarrett@ACBusinessMedia.com

TACKLING THE TALENT SHORTAGE What are you doing to get the right kinds of talent in the right place, at the right time?

I

t doesn’t matter whom we are mentoring and online training talking to about the supply chain, courses to mentor and grow when we ask these professionals supply chain workers from what keeps them up at night, their within. answer is typically a shortage of skilled Other companies, such as labor and the talent gap.

Ryder System Inc., employ Several factors contribute to this: recruiters across the country to drum up ❯❯ There is a lack of emerging talent. talent, and partner with programs designed Supply chains and manufacturing to get military veterans and women into companies have increased in the field. Others, such as Penske Logistics, complexity and size, but the have found great success in ramping workforce hasn’t grown at the same up advertising efforts to boost brand rate. In fact, some sources state awareness and in increasing their social the rate of openings to the pool of media recruiting efforts. workers to choose from may actually Colleges have also increased their supply be six to one. Baby boomers are chain programs, so much so, that in this retiring and new workers are not By being proactive, as opposed to always choosing reactive, you may become the company supply chain as a career. everyone wants to work for, instead of ❯❯ A talent gap exists. the one making due with less.

Seasoned baby boomers are being replaced by less knowledgeable and issue, we’ve included a comprehensive experienced workers, who often lack list of these programs in our Professional the necessary skillsets to work in Development department on Page 42. such a complex field.

These programs not only are a good ❯❯ The supply chain is increasingly place to find new hires, but they also complex. Customer demands and offer excellent opportunities to build the needs are escalating, especially in skillsets of existing employees. order fulfillment and omnichannel The talent shortage may be a real threat retailing. The supply chain is now to your operation. But by being proactive, global. This increased complexity as opposed to reactive, you may become requires workers with greater the company everyone wants to work for, technical skills. instead of the one making due with less.

Some companies are addressing the problem by providing in-house training, 4

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Published by AC Business Media Inc. 201 N. Main Street, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com

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June 2016 / Volume 17 / Issue 3

6/17/16 9:40 AM

BUILD PARTNERSHIPS THAT GO BEYOND JUST PURCHASES.

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You can’t seize the moment when you’re focused on the day-to-day. SAP Ariba simplifies the routine demands of procurement and lets you collaborate live with suppliers.

So you can partner on innovations that keep your company moving forward in a fast-changing economy.

Visit ariba.com

© 2016 SAP SE. All rights reserved.

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SDCE 100

By Editorial Staff, Supply & Demand Chain Executive

The 2016 Supply & Demand Chain Executive 100 charts a course that overflows with innovation and solutions to mimic to maximize efficiency, profitability and more.

What differentiates a successful business from a failing or flailing business? The foresight to eke out what other organizations are doing to succeed, then extrapolating and implementing what applies to your company, chasing metrics to justify and improve these projects, and repeat. That is why Supply & Demand Chain Executive (SDCE) compiles this annual list of the best 100 supply chain transformations and projects. You just never know when a competitor, or even an entirely unrelated company, may have the same kind of lowhanging fruit to pluck.

These projects can serve as a prospective template for supply chain executives seeking opportunities to drive transformation in their own organizations. From distribution to demand planning, these innovations depict how supply chain and service providers can partner with you to take your business from ordinary to extraordinary.

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FEATURED PROJECTS ENABLER: AFN LLC (WWW.LOADAFN.COM) CUSTOMER: Ocean Spray Cranberries Inc. PROJECT GOAL: Improve on-time delivery, eliminate

chargebacks, and improve acceptance and service levels SOLUTIONS: Proprietary solutions used by AFN BUSINESS IMPACT: Ocean Spray awarded freight to carriers through a waterfall process, with acceptance expectations of approximately 60 percent for primary carriers and 25 percent for non-primary. Through the Greenlock freight process, drop trailer capabilities and familiarity with end-retailer requirements, AFN improved Ocean Spray’s acceptance levels, reduced last-minute rescheduling and achieved close to a 100 percent on-time range for end-of-month deliveries.

INDUSTRIAL REAL ESTATE THAT MAKES CENTS FOR YOUR SUPPLY CHAIN!

ENABLER: ALOM (WWW.ALOM.COM) CUSTOMER: Biotechnology company PROJECT GOAL: Expand product availability from

e-commerce only to a retail channel SOLUTIONS: Electronic data integration (EDI), Automated Clearing House (ACH) processing and serial shipping container code (SSCC) tracking BUSINESS IMPACT: ALOM engineered an order management process integrating retailer EDI systems to receive orders by ALOM and feed them to the client for visibility, removing latency through direct connectivity via ALOM-developed EDI and ACH system integration processes. ALOM’s SSCC label barcode process tracks the serial number of each package.

ENABLER: AVATA (WWW.AVATA.COM) CUSTOMER: Chicken of the Sea International PROJECT GOAL: Measure the effectiveness of trade spend SOLUTIONS: Oracle Demantra Predictive Trade Planning, and Deduction and Settlement Management BUSINESS IMPACT: Chicken of the Sea wanted a streamlined process and tool to plan, review and approve promotions, and improve sales forecasting and settlements management. The company now has visibility into planned, accrued and actual spend. And, a foundation is in place for sophisticated trade spend optimization.

CenterPoint reduces your logistics expenses, creating a better bottom line.

ENABLER: AVERCAST LLC (WWW.AVERCAST.COM) CUSTOMER: Global automotive parts supplier PROJECT GOAL: Improve forecast accuracy, increase

inventory turns, reduce stock-outs and trim inventory levels SOLUTIONS: Avercast Business Forecasting and Supply Planning BUSINESS IMPACT: The supplier sought an enterprise-

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SDCE 100 level global forecasting and demand planning platform. Avercast raised forecast accuracy up to 92 percent, resulting in inventory reductions, increased inventory turns, elimination of expedited shipments, better customer service and curtailed stock-outs.

report of vessels carrying Triumph shipments that experience a schedule change of over 24 hours.

ENABLER: B-STOCK SOLUTIONS (WWW.BSTOCK.COM) CUSTOMER: Fortune 500 home improvement retailer PROJECT GOAL: Help recover higher prices for

lifecycle solutions company PROJECT GOAL: Ensure all SCM employees are certified with the relevant skills and training required to execute the company’s overall strategy SOLUTIONS: INsight, Celestica’s learning management system; Google Forms; the Analyze, Design, Develop, Implement and Evaluate (ADDIE) process; and the Kirkpatrick Three-Level Training Evaluation Process BUSINESS IMPACT: The company recognized the need to unlock the potential of its talent, and embarked upon a project to ensure that all SCM employees were trained and certified in their roles.

Employees completed more than 35,000 courses, which drove an increase in buyer efficiency by 10 percent per annum and planner efficiency by 20 percent per annum. The project impacted 2,300 employees, and improved and standardized SCM business processes for all learning pathways.

customer-returned and excess inventory SOLUTIONS: B-Stock’s B2B Enterprise Solution BUSINESS IMPACT: B-Stock developed a private online auction marketplace, connecting the retailer’s returned and excess merchandise to qualified buyers with no middleman. By removing layers of supply chain and creating buyer competition, the retailer increased recovery rates by more than 20 percent across product categories.

“NOT ONLY ARE WE CARRYING LESS STOCK, BUT WE HAVE THE VISIBILITY TO BE ABLE TO ALLOCATE THE RIGHT INVENTORY TO THE RIGHT WAREHOUSES … NOW WE CAN PROACTIVELY MANAGE INVENTORY ACROSS WAREHOUSES AND BETTER SERVE OUR CUSTOMERS.” NÉVINE BOUZAKHM, A. R. MEDICOM

ENABLER: BROWZ LLC (WWW.BROWZ.COM) CUSTOMER: BROWZ PROJECT GOAL: Simplify motor

carrier evaluation within supply chain SOLUTIONS: Browser-based motor carrier verification software BUSINESS IMPACT: SURE Carrier enables customers to monitor key CSA BASICs metrics on their entire population of carriers. SURE Carrier pulls FMCSA/DOT data together, making it easy to track and trend the safety and performance of motor carriers in your supply chain. SURE Carrier provides a detailed view of the performance of current carriers, as well as added data to validate new carriers.

ENABLER: CARGOSMART LIMITED (WWW.CARGOSMART.COM) CUSTOMER: Triumph Express Service Canada Inc. PROJECT GOAL: Increase visibility to accurate sailing schedule data to elevate customer service SOLUTIONS: Private Label Sailing Schedule and Schedule Delay Alert BUSINESS IMPACT: Triumph found it timeconsuming to find current sailing schedules. The client implemented a Private Label Sailing Schedule application that provides it and its customers visibility into the latest consolidated schedules.

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ENABLER: CELESTICA INC. (WWW.CELESTICA.COM) CUSTOMER: Multinational end-to-end product

ENABLER: CLX LOGISTICS LLC (WWW.CLXLOGISTICS.COM) CUSTOMER: Fortune Global 500 company PROJECT GOAL: Manage logistics activity in and

out of Asia, and freight audit and settlement SOLUTIONS: Kewill TMS BUSINESS IMPACT: This shipper now uses a software-as-a-service (SaaS)-based TMS for planning, execution and settlement of its shipments.

Implementing the Kewill SaaS global TMS allowed the client to have a common process and technology for all of its markets. The shipper is seeing an ROI of 8 to 12 percent on its efforts.

ENABLER: CORPORATE UNITED (WWW.CORPORATEUNITED.COM) CUSTOMER: Ace Hardware Corporation PROJECT GOAL: Reduce operational costs and

indirect spend for its independent retailers SOLUTIONS: Corporate United group purchasing organization (GPO) BUSINESS IMPACT: Ace Hardware decided to use a GPO to decrease operational costs and bring pre-negotiated programs to its stores. It worked with Corporate United to determine which GPO categories would be best for initial rollout.

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Corporate United completed assessments on six categories, and in each case, savings estimates were between 9 and 22 percent.

ENABLER: DEMAND MANAGEMENT INC. (WWW.DEMANDSOLUTIONS.COM) CUSTOMER: A. R. Medicom Inc. PROJECT GOAL: Improve the demand planning

and procurement processes and system SOLUTIONS: Demand Solutions Forecast Management and Requirements Planning BUSINESS IMPACT: Demand Solutions improved A. R. Medicom’s forecast mix accuracy by 10 percent in Canada and 16 percent in the U.S., reduced total inventory by $3.5 million, decreased backorder units by 54 percent and boosted fill rates by 30 percent.

ENABLER: ECMARKET INC. (WWW.CONEXIOM.COM) CUSTOMER: CAPP/USA PROJECT GOAL: Accelerate invoice processing speeds and maximize early payment incentives

SOLUTIONS: Conexiom Account Payables (AP) Invoice Automation

BUSINESS IMPACT: Automation can reduce

invoice processing costs by as much as 80 percent.

CAPP/USA now quickly processes invoices, while avoiding errors, delays and lost invoices.

ENABLER: ELEMICA (WWW.ELEMICA.COM) CUSTOMER: BASF PROJECT GOAL: Automate the end-to-end

purchase-to-pay (P2P) process SOLUTIONS: Elemica Supply Chain Operating Network and Supplier Collaboration Portal BUSINESS IMPACT: BASF needed an automated end-to-end P2P process for about 5,000 direct material suppliers. Elemica deployed a tool to automate supplier contact, track supplier open rates and campaign performance, and provide selftraining tools and purchase order (PO) flow. BASF was able to onboard 100 suppliers in 90 days.

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 220 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. © 2016 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

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SDCE 100 ENABLER: FORTNA INC. (WWW.FORTNA.COM) CUSTOMER: Ulta Beauty PROJECT GOAL: Add capacity to support

e-commerce and store growth, and enable faster replenishment and omnichannel capabilities SOLUTIONS: Manhattan WMoS, Lightning Pick light-driven put walls and FortnaWCS BUSINESS IMPACT: Ulta Beauty’s transformation included: the design, implementation and support of two omnichannel greenfield DCs; a new forecasting, replenishment and allocation system, as well as a new WMS and WCS; and the retrofitting of e-commerce capabilities into an existing DC. The company improved delivery cycle time to stores by more than 50 percent and boosted inventory accuracy, while reducing out-of-stocks.

“HAVING THIS INSIGHT INTO WHAT OUR COSTS ARE WHEN PURCHASING DOMESTICALLY VERSUS INTERNATIONALLY AND HOW EACH SOURCING VARIABLE WILL AFFECT OUR OVERALL COST STRUCTURE IS IMPERATIVE FOR NAVIGATING TODAY’S PROCUREMENT LANDSCAPE.” SUPPLY CHAIN PLANNER AT ONE OF AMERICA’S LARGEST PRIVATE COMPANIES

ENABLER: GLOBAL4PL SUPPLY CHAIN SERVICES (WWW.GLOBAL-4PL.COM) CUSTOMER: Forbes Global 2000 telecommunications manufacturer

PROJECT GOAL: Deliver product in a window

ranging from two hours to next day, to two to five days SOLUTIONS: Importer and exporter of record (IOR/EOR) services, and PO/Horizon Global Trade Management software BUSINESS IMPACT: Global4PL provided a network of legal entities and depots in each country.

PO/Horizon Global Trade Management software produced the documentation to manage the import/ export process into 76 countries, all of which have a different Harmonized Tariff Schedule, and import and export requirements. Global4PL lowered the global reverse logistics program from two weeks from order to customer to less than four days.

ENABLER: INTELLIGRATED (WWW.INTELLIGRATED.COM) CUSTOMER: MERRILL CORPORATION PROJECT GOAL: Minimize order fulfillment

errors and increase overall throughput SOLUTIONS: Intelligrated voice solution BUSINESS IMPACT: Merrill sought a reliable and automated method of order fulfillment. The Intelligrated voice solution reduced errors by 65 percent and raised accuracy from 99.73 to 99.90 10

percent. Implementing voice also enabled Merrill to increase throughput by 45 percent and reduce staffing requirements.

ENABLER: INTESOURCE, A PROACTIS COMPANY (WWW.INTESOURCE.COM) CUSTOMER: One of America’s largest companies PROJECT GOAL: Extend buying expertise and

capabilities for direct and indirect spend SOLUTIONS: E-sourcing and managed sourcing BUSINESS IMPACT: Intesource saved the company more than $115.5 million and executed 642 sourcing projects. Intesource’s expertise in sourcing non-traditional, time-consuming and complex categories played a key role in value-generation activities. Savings numbers from individual sourcing projects include 30.9 percent on construction and remodeling, and 30.2 percent on floor care.

ENABLER: JOHN GALT SOLUTIONS INC. (WWW.JOHNGALT.COM) CUSTOMER: Reddy Ice PROJECT GOAL: Implement a forecasting and

order generation tool for a daily delivery schedule SOLUTIONS: Atlas Planning Suite, regression analysis and distribution requirements planning BUSINESS IMPACT: John Galt developed a self-learning algorithm, which optimizes forecasts according to the latest data, to accurately forecast daily deliveries, so Reddy Ice can plan imminent production and deliveries without manual intervention. Atlas Planning Suite combined point-of-sale data with external data to compute the forecast, resulting in a 50 percent reduction in call-in orders and a 20 percent increase in sales.

ENABLER: KEYSIGHT TECHNOLOGIES (WWW.KEYSIGHT.COM) CUSTOMER: Keysight Technologies PROJECT GOAL: Transform the end-to-end

worldwide logistics ecosystem to become efficient SOLUTIONS: Lean methodologies and tools BUSINESS IMPACT: Worldwide cross-functional teams conducted waste walks through the logistics network and warehouse footprint. Over 20 global projects were completed with logistics partners, resulting in major transformations across Keysight’s global end-to-end logistics ecosystem. The outcome was better delivery quality metrics, a cost savings of $1.7 million, a 50 percent reduction in lead time and an inventory shrinkage of $3 million.

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ENABLER: LEANLOGISTICS INC. (WWW.LEANLOGISTICS.COM) CUSTOMER: Large direct-to-store milk provider PROJECT GOAL: Centralize transportation

management and provide full visibility SOLUTIONS: LeanLogistics LeanTMS and Managed Transportation Services BUSINESS IMPACT: The project brought the client’s facilities onto a centralized system. The client can now obtain an end-to-end analysis of its dynamic supply chain and review cost impacts from a range of levers. It decreased accessorial charges by up to 8 percent and increased cost savings through visibility into round-trip opportunities.

ENABLER: LIBRESTREAM TECHNOLOGIES INC. (WWW.LIBRESTREAM.COM) CUSTOMER: Global appliance manufacturer PROJECT GOAL: Accelerate speed to market,

improve uptime and reduce field service costs SOLUTIONS: Librestream’s Onsight video collaboration and diagnostic platform

BUSINESS IMPACT: By engaging in live Onsight

video collaboration sessions, teams were able to diagnose issues with new parts and set up new production lines. Onsight became part of the design, quality and supply chain workflow, helping to accelerate new product introduction cycles by 10 to 20 percent, improve production uptime by 5 to 10 percent and save direct field-testing costs.

ENABLER: LOGISTICS PLUS INC. (WWW.LOGISTICSPLUS.NET) CUSTOMER: A German large pipe manufacturer PROJECT GOAL: Determine an efficient port and

ground transportation to import and deliver pipe SOLUTIONS: Import and port negotiation skills, and domestic ground transportation capabilities BUSINESS IMPACT: Logistics Plus worked with the Port of Monroe to negotiate and broker its first big cargo shipment in 50+ years. The port director readied the port with local rigging and handling resources. Logistics Plus then arranged a larger shipment to be delivered to the Ashtabula County

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. © 2016 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

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SDCE 100 Port Authority. All 2,500 pipes were successfully delivered and transported to final destinations.

ENABLER: OMNITRACS LLC (WWW.OMNITRACS.COM) CUSTOMER: Palmer-Donavin Mfg. Co. PROJECT GOAL: Improve delivery efficiency, asset

utilization and customer service SOLUTIONS: Omnitracs Roadnet BUSINESS IMPACT: Palmer-Donavin adopted the Omnitracs Roadnet daily routing tool to help find the balance between route efficiency and customer service with real-time data and fleet-wide visibility.

Omnitracs Roadnet addresses high order volumes, rising fuel costs, changing traffic conditions, and managing drivers and vehicles.

“PRIOR TO OMNITRACS ROADNET, OUR COMPANY EXPERIENCED SERIOUS LOGISTICS CHALLENGES THAT DETRACTED FROM OUR CUSTOMER SERVICE GOALS AND OUR BOTTOM LINE …

WE ARE NOW PASSING $200 MILLION IN SALES AND IT PUT US ON A PATH TO REACH OUR 20/20 VISION OF REACHING $300 MILLION IN SALES.” RONALD CALHOUN, PALMER-DONAVIN MFG. CO.

ENABLER: PALADIN ASSOCIATES INC. (WWW. PALADINASSOCIATESINC.COM) CUSTOMER: World leader in nutrition

and additives for animal feed PROJECT GOAL: Reduce U.S. distribution and transportation costs, and delivery times from offshore factories BUSINESS IMPACT: This project included analyzing current distribution and transportation costs, and determining alternative distribution strategies and warehouse locations. Paladin recommended a significant change and the client moved its key U.S. warehouse from Des Moines, Iowa to Savannah, Georgia. Actual confirmed savings totaled over 25 percent of prior total warehousing and transportation costs, and reduced the delivery time by eight days.

ENABLER: PURIDIOM (WWW.PURIDIOM.COM) CUSTOMER: Blue Cross & Blue

Shield of Rhode Island PROJECT GOAL: Increase supplier risk management capabilities within Puridiom SOLUTIONS: Integration with Dun & Bradstreet (DnB) and WatchDOG Pro BUSINESS IMPACT: Real-time data integration from DnB provided the client with access to risk assessment, diversity and Data Universal Numbering System information. WatchDOG Pro provides real-time data on suppliers. Puridiom’s link provides reporting and auditing capabilities.

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ENABLER: QUINTIQ (WWW.QUINTIQ.COM) CUSTOMER: Fairmount Santrol PROJECT GOAL: Optimize planning and scheduling SOLUTIONS: Quintiq platform BUSINESS IMPACT: The Quintiq platform

optimizes sourcing and production processes through the management of production and transportation assets. A 100 percent fit helps the company properly manage key route and capacity constraints to reduce landed costs and lost production time.

ENABLER: SADDLE CREEK LOGISTICS SERVICES (WWW.SCLOGISTICS.COM) CUSTOMER: Subscription beauty products company PROJECT GOAL: Customize order fulfillment and small parcel freight management SOLUTIONS: Softeon inventory management system; WMS; and automated conveyors, scanners and label applicators BUSINESS IMPACT: Saddle Creek handles beauty product orders for millions of subscribers each month, assembling as many as 60 custom bag configurations and fulfilling e-commerce orders from the client’s website. The third-party logistics provider increased orders by more than 1,000 percent, and sped the handling of component and finished goods inventory.

ENABLER: SAP FIELDGLASS (WWW.FIELDGLASS.COM) CUSTOMER: Navistar Inc. PROJECT GOAL: Expand recruitment team’s focus

to include contingent workers SOLUTIONS: SAP Fieldglass Vendor Management System (VMS) and Bartech Managed Services Provider (MSP) BUSINESS IMPACT: The Navistar team used the SAP Fieldglass VMS as though it was a staffing supplier and the Bartech MSP handled payrolling.

Navistar reduced its cost per hire by nearly 50 percent without sacrificing worker quality; saved 8 to 13 percent per worker by decoupling contingent worker recruiting and payrolling; reduced cost per hire when converting contractors into full-time positions; and slashed vendors with whom to negotiate, contract, audit, etc.

ENABLER: SOLVOYO (WWW.SOLVOYO.COM) CUSTOMER: DeFacto PROJECT GOAL: Increase demand forecasting accuracy and on-shelf availability

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SDCE 100 2016 SOLUTIONS: Demand forecasting, multi-echelon

inventory optimization, store-to-store transfer and replenishment planning, and exception-based parameter setting and planning BUSINESS IMPACT: Solvoyo delivered a cloud-based, automated and centralized SaaS replenishment planning system, so DeFacto now makes replenishment, allocation and store-to-store transfer decisions automatically. This created a net savings of $1.2 million and led to a 23 percent reduction in stock-outs.

ENABLER: TRANSPLACE (WWW.TRANSPLACE.COM) CUSTOMER: Consumer packaged goods company PROJECT GOAL: Deploy DCs to optimize

warehousing and transportation costs SOLUTIONS: Transplace Scenario Pro Technology and LLamasoft Supply Chain Guru BUSINESS IMPACT: The client wanted to streamline the network to improve service, reduce costs and enhance the roles of existing DCs to allow

more efficient shipment consolidation. A thorough rate structure supporting various costs was created and modeled.

ENABLER: TRANSPORTATION INSIGHT (WWW.TRANSPORTATIONINSIGHT.COM) CUSTOMER: Power equipment parts manufacturer PROJECT GOAL: Maintain leadership and growth,

while providing world-class customer service and same-day shipping SOLUTIONS: Transportation Insight Enterprise Logistics, Insight TMS, Co-managed Logistics Partnership, Insight Fusion and Extended LEAN BUSINESS IMPACT: The manufacturer maintains operations control, while the enabler manages carrier contracts, audits freight invoices, delivers reporting and assists in improvement initiatives. The partnership reduced less-than-truckload logistics costs by 24 percent, truckload costs by 8.2 percent and parcel shipments costs by 20.2 percent, and curtailed manufacturing lead times by 60 percent.

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 • Nationwide Container Drayage from most major rails and ports • 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. © 2016 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved.

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SDCE 100

WW4SIGHT Supply Chain Group, www.go4sight.com WWAgistix Inc., www.agistix.com WWAmazing Print Corp., www.amazingprint.com WWArena Solutions Inc., www.arenasolutions.com WWAvendra LLC, www.avendra.com WWBastian Solutions Inc., www.bastiansolutions.com WWBasware, www.basware.com WWBlue Ridge Solutions Inc., www.blueridgeglobal.com

WWC3 Solutions, www.c3solutions.com WWCargo Chief, www.cargochief.com WWCaseStack, ww2.casestack.com WWCBX Software, www.cbxsoftware.com WWCenseo Consulting Group, www.censeoconsulting.com

WWChainalytics LLC, www.chainalytics.com WWClearMetal Inc., www.clearmetal.com WWClearpath Robotics Inc., www.ottomotors.com WWCloud Logistics, www.gocloudlogistics.com WWDigital Lumens Inc., www.digitallumens.com WWDMW&H Inc., www.dmwandh.com WWE2open, www.e2open.com WWeLynxx Solutions, www.elynxx.com WWEpicor Software Corporation, www.epicor.com WWFreightview, www.freightview.com WWGatewit, www.gatewit.com WWGEP Worldwide, www.smartbygep.com WWGreybeard Advisors LLC, www.greybeardadvisors.com

WWHAVI Global Solutions, www.havigs.com WWHermes NexTec, www.hermesworld.com/us WWInternational Business Systems, www.ibs.net WWINSIGHT Inc., www.insightoutsmart.com WWIntegration Point, www.integrationpoint.com WWIntelligrated, www.intelligrated.com WWInternational Asset Systems (IAS), www.interasset.com

WWInvata Intralogistics, www.invata.com WWJDA Software Group Inc., www.jda.com

WWJump Technologies Inc., www.jumptech.com WWJVKellyGroup Inc., www.jvkg.com WWKewill Inc., www.kewill.com WWKinaxis, www.kinaxis.com WWLLamasoft Inc., www.llamasoft.com WWLogility, www.logility.com WWNeoGrid, www.neogrid.com/en WWNetSuite, www.netsuite.com WWNext Level Purchasing Association,

WWOnProcess Technology Inc., www.onprocess.com WWOptoro, www.optoro.com WWOptricity, www.optricity.com WWParagon Software Systems Inc.,

wellness manufacturer PROJECT GOAL: Identify product diversion and fraud in the global distribution chain SOLUTIONS: VFT Solutions Straw Site Technology and VLA Analytics Software BUSINESS IMPACT: The manufacturer found its export-only product being sold in the U.S. in brick-and-mortar retail stores and online at reduced rates. VFT set up a straw site to appear as an import/ export company to pose as potential resellers. The straw company approached the international distributors of that product with the intention to determine which may violate agreements. The manufacturer identified and sealed a leak in its distribution chain that was causing export-only products to re-enter the United States.

WWPINC Solutions, www.pincsolutions.com WWProcurePort, www.procureport.com WWPurolator International,

ENABLER: VIZIENT INC. (WWW.VIZIENTINC.COM) CUSTOMER: INTEGRIS Health PROJECT GOAL: Transform supply

www.nextlevelpurchasing.com

WWNew Generation Computing Inc., www.ngcsoftware.com

WWNipendo, www.nipendo.com WWNPI LLC, www.npifinancial.com WWOnDemand Resources, www.ondemandresources.com

www.paragontruckrouting.com

www.purolatorinternational.com

WWRedwood Logistics, www.redwoodlogistics.com WWResilinc, www.resilinc.com WWriskmethods Inc., www.riskmethods.net/en WWRiverwood Solutions, www.rwsops.com WWShipXpress Inc., www.shipxpress.com WWSmithers Pira, www.smitherspira.com WWSpend Management Experts, www.spendmgmt.com

WWSynergy Ltd., www.snapfulfil.com WWTMC, a division of C.H. Robinson Worldwide, www.mytmc.com

WWToolsGroup, www.toolsgroup.com/en WWTransporeon, www.transporeon.com/us WWUNEX Manufacturing Inc., www.unex.com WWYale Materials Handling Corporation, www.yale.com/north-america/en-us

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ENABLER: VFT SOLUTIONS INC. (WWW.VFT-SOLUTIONS.COM) CUSTOMER: Major medical and

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

chain operations to sustain $15 million in savings realized from Vizient cost reductions SOLUTIONS: Supply chain operations transformation BUSINESS IMPACT: Vizient aligned INTEGRIS Health facilities under a single supply chain operations structure. Process improvements reduced PO processing errors to 2.8 percent, increased contract-line validation by almost half, slashed contract price exceptions by about 60 percent, improved warehouse replenishment effectiveness, increased electronic invoicing by 400 percent and more.

By Sergio Retamal

ADVERTORIAL

Importer/Exporter of Record Services:

DIRECT DELIVERY DOOR TO DOOR GLOBALLY

An importer/exporter of record administrates import/export activities, such as coordinating all activities in alignment with specific compliance regulations, and requirements of the product and source/destination country rules.

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he paradigm shift to cloud computing is creating a demand for global logistics support. For example, when a Fortune 5000 purchases a security appliance for global use, it expects to interface with one entity—the appliance manufacturer—not a number of different value-added resellers (VARs) that are region-dependent. The security appliance company must then be able to fulfill this order around the globe, oftentimes shipping not to a Fortune 5000’s facility, but to a co-location data center. This shift in customer practices creates a perfect storm that requires an economical way to deliver product globally without channel support. Enter the importer/exporter of record (IOR/EOR).

Companies providing IOR/EOR services have been around for many years An IOR/EOR acts as an agent to administrate import/export activities, such as coordinating all activities in alignment with specific compliance regulations, and requirements of the product and source/destination country rules. The IOR/EOR has a physical presence and business relationships in the destination country.

Its ability to perform these services comes with a side benefit that is characteristic of the IOR/EOR’s DNA. The IOR/EOR carries only the overhead to provide the services that are specific to product fulfillment. Therefore, the IOR/EOR support model can result in s15 to 30 percent in avings over a channel sales model. The IOR/EOR can also provide in-country services that are associated with leasing activities that a channel partner may or may

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not do on an original equipment manufacturer’s (OEM) behalf.

Is this transition to the cloud and changes in an OEM’s revenue model the death knell for channel sales? Of course not. Distributors and resellers have a solid value proposition, but it doesn’t extend to all sales opportunities. To remain competitive, OEMs must use all options available to meet customer demands.

OEMs can embrace this challenge by offering a two-tiered sales approach. When an international opportunity is region-specific, the channel is well-equipped to support it. However, when an opportunity has either a subscription-based revenue model attached to it, or the opportunity requires global logistics support, or the competitive environment demands a discount level that the channel cannot support—the perfect storm—direct to customer via an IOR/EOR is the answer.

ABOUT THE AUTHOR

“This shift in customer practices creates a perfect storm that requires an economical way to deliver product globally without channel support. Enter the importer/ exporter of record (IOR/EOR).”

SERGIO RETAMAL, PRESIDENT AND CEO, GLOBAL4PL SUPPLY CHAIN SERVICES

SERGIO RETAMAL is the president and CEO of Global4PL Supply Chain Services, a leading supply chain solutions provider that specializes in helping high-tech companies penetrate new regional markets, optimize their supply chain delivery models and demonstrate total supply chain costs lower than the competition.

The company delivers—with quick payback—innovative, softwarebacked solutions to its global customer base. For more information, please email info@global-4pl.com or visit www.global-4pl.com.

SDCExec.com | June 2016 | SUPPLY & DEMAND CHAIN EXECUTIVE

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ADVERTORIAL

By Tony Harris

The Case for

DIGITIZING THE DIRECT MATERIALS

Supply Chain Moving procurement beyond real time

T

oday’s consumers want products with the latest innovations customized to their needs. And they want them now.

Procurement plays an important role in bringing these products to market quickly. But it isn’t an easy task.

All too often, procurement is asked to obtain cost details of the components within a bill of material (BOM) only after engineering has decided upon the final product design. And upon digging in, they find that the design is too expensive and send the engineers back to the drawing board.

This not only causes frustration, but delays in bringing the product to market.

DISCOVER & FOLLOW

Learn More about Digital Procurement

INNOVATIONS ARE CHANGING THE GAME

www.ariba.com/ solutions/how-we-help/ supply-chain

In an ideal world, procurement would be involved in the design process from the outset. This way, they could advise on a variety of factors that not only impact the final product cost, but quality, supply availability, product component rationalization and product innovation.

The reality is, many organizations are hamstrung by disconnected and manual processes that make such collaboration difficult. But they don’t need to be.

Explore Some Case Studies www.ariba.com/ customers Follow Tony Harris on LinkedIn www.linkedin.com/in/ tonyharris1 16

A new breed of solutions to digitize the direct materials supply chain is fast emerging. And they are changing the game when it comes to sourcing direct materials, fueling a more simple, open and smart way to manage the entire process from end to end.

COLLABORATION HUBS IN THE CLOUD Leveraging the convenience and agility of the cloud and connectivity of business networks, such solutions link the systems, information, people and processes procurement needs to source the right materials from the right suppliers at the right time with greater simplicity, efficiency and speed than ever.

For instance, by integrating product lifecycle management (PLM) solutions and procurement systems, they can automate the process of sending BOMs created in PLM directly to the sourcing solution, ensuring that all the component cost, supply availability and supplier information procurement needs to accurately plan, forecast and buy is available to them.

They can also serve as a collaboration hub for the many interactions that need to take place throughout this process both internally and with external suppliers, such as managing iterations with product design and engineering, along with subsequent changes to BOM structure.

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CASE STUDY: National DCP Transforms Direct Materials Sourcing with SAP Ariba CONTRACTS STRAIGHT FROM ERP Once a final product design has been determined, the sourcing team can use collaborative negotiation functionality to award contracts to selected suppliers. And of critical importance, they can ensure that these contracts find their way to the enterprise resource planning (ERP) system, along with all of their associated master data. Why is this so critical?

Because the process of buying direct materials is typically driven from the ERP system as part of materials requirements planning (MRP). MRP determines the quantity of a given product that is going to be built and, in turn, the quantity of components or inputs that go into the production process. Sometimes these components or inputs come from existing stock, but invariably, a purchase order (PO) needs to be raised to buy the components from the relevant supplier at the contracted price.

By integrating the contract from the sourcing process with ERP, procurement can create an accurate source of supply record to ensure that POs are raised with the right suppliers at the right prices.

These POs then can be automatically sent, directly from the ERP system, to suppliers who can access them in their own ERP systems as sales orders, and quickly and easily send order confirmations, advance ship notices and invoices free from the errors that often result from manual processes.

The net-net of this digitization? Aside from the savings, efficiencies and compliance that procurement is expected to deliver, it can speed the delivery of new products. And in today’s fastmoving world where real time is no longer enough, this could be the difference between being today’s must-have item and yesterday’s news.

Find out how SAP Ariba can help you simplify your supply chain at: www.ariba.com/solutions/how-we-help/supply-chain

ABOUT THE AUTHOR TONY HARRIS is global vice president and general manager, Direct Procurement Solutions, SAP Ariba. He has over 20 years of experience across both finance and IT, and spent the last 12 years focused on the procurement solutions sector. In his current role, Harris is responsible for the strategy, go to market and commercial success of SAP Ariba solutions for the direct spend category. He was named a Pro to Know in 2013 by Supply & Demand Chain Executive.

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The supply chain management company leverages cloud-based applications to fuel an efficient digital process that increases productivity and lowers sustainable costs.

Transformation can be defined in many ways. But for National DCP (NDCP), it means one thing: driving innovation on a massive scale across systems and processes to deliver tangible results. With the help of SAP Ariba, the $2 billion supply chain management company serving the franchisees of Dunkin’ Donuts, is doing just this. Leveraging SAP Ariba’s market-leading cloud-based applications alongside its SAP ERP system, NDCP is fueling an efficient digital process for sourcing direct materials that is transforming its operations, and improving both its top and bottom lines.

“When it comes to direct materials, procurement isn’t just about buying things at the best prices, but collaborating in new, more efficient ways that create value,” says Darrell Riekena, chief information officer/chief operating officer at NDCP. “Doing this this requires best-in-class solutions that go beyond simply automating tasks to connect stakeholders and systems across functions, divisions and geographies.”

NDCP is no stranger to forging such connections. The cooperative was formed in 2012 through the merger of five operating companies, each with their own technologies and ways of operating. To achieve its business goals, NDCP knew it would need to standardize things. So it launched Project Freshstart, a comprehensive, digital transformation initiative that involved changing every system and process that supported its business.

“This was an unprecedented amount of change,” Riekena recalls. “But it was the fastest way to accelerate our business.”

To enact this change with as little disruption as possible, NDCP turned to the cloud. And with support from its partner Deloitte Consulting LLP, the company began implementing solutions from SAP Ariba alongside its SAP ERP system. The result? Seamless integration of its operations to source product, transact orders, and manage inventory and financials.

“Direct materials procurement isn’t a series of discrete tasks, but a connected process that involves tight integration of people, information and processes,” says Tony Harris, general manager, Direct Procurement Solutions, SAP Ariba. “As innovative organizations like NDCP recognize, the only way to effectively manage this process is through end-to-end, network-based solutions that are enterprise strong, yet consumer simple, and power new ways of thinking and operating that create an advantage.”

SAP Ariba provides a simple, smart and open way to drive an efficient digital supply chain, connecting all systems, processes and spend through a powerful global platform—the Ariba Network. Using the cloud-based applications and services delivered on the network, companies can simplify collaboration with their trading partners, make smarter business decisions and extend their collaborations across the entire source-to-pay process.

To learn more about SAP Ariba’s offerings and the transformation it is driving, visit www.ariba.com SDCExec.com | June 2016 | SUPPLY & DEMAND CHAIN EXECUTIVE

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ADVERTORIAL

By Rick Turek

Next-Generation Navigation:

WHEN BIG DATA DRIVES INNOVATION, DRIVERS WIN The biggest challenge for truck navigation systems on the market today?

Keeping data current.

G

one are the days of folded paper roadmaps and cross-country atlases. When we need to get from Point A to Point B, we look to our smartphones or global positioning system (GPS) navigation devices. At the touch of a button, we have clear routes that show traffic slowdowns, road construction, and alternate routes to help us avoid tolls and accidents. But, when your business is built on the road, your GPS navigation system has to stand up to challenges that most consumer products don’t face.

The biggest challenge for truck navigation systems on the market today? Keeping data current. That means navigation systems should be using roads that really do exist, including new roads that have just opened up— and road names must be accurate to keep drivers from getting lost. It can cost a fleet of 1,000 trucks between $240,000 and $500,000 per year to keep the data current. Due to the significant cost, most navigation data sets are between one and two years out of date. As you can imagine, the older the dataset is, the greater the opportunity for a negative driver experience.

IT CAN COST A FLEET OF 1,000 TRUCKS BETWEEN $240,000 AND $500,000 PER YEAR TO KEEP THE DATA CURRENT.

HOW DO TODAY’S GPS SYSTEMS WORK? Today’s trucking navigation systems rely on a few different approaches, and there are pluses and minuses to each.

GPS Navigation Systems with Data Onboard

The great benefit of a GPS system with the data onboard is that the system is always quick to respond to the driver, whether there’s cellular 18

connectivity or not. The downside here are that they come with big data sets, usually two to three gigabytes, and they’re expensive to update.

These systems are also out of date at the time of installation by at least three to six months. And, if you’re a fleet of thousands of trucks, it could take you six months or longer to roll out updates. So, for all intents and purposes, your drivers are using data that’s a year or two out of date.

GPS Navigation Systems with Data Off-Board

The off-board solution means there’s no data, or very little data, on the device itself. The advantage of having the data on the server side only is that it’s easier to keep it current.

The weakness is that the navigation system only works when wireless connectivity is available. And that can be frustrating for a driver who is paid by the mile and feels the pressure of the ticking clock.

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

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Hybrid Navigation Systems with Onboard and Off-Board Data The hybrid solution attempts to take a best of both worlds approach. It attempts to generate routes and geocodes, and performs address and point-of-interest (POI) searches on the server side, so the driver accesses the best data while he or she is connected. But, if the driver is in a poor reception area, the application must fall back to data stored on the device, which typically is of lesser quality and/ or significantly out of date. Further, sometimes the system is very fast and, at other times, it’s very slow, giving an inconsistent experience.

SCALING DATA MANAGEMENT AND DATA PUBLICATION Consider the number of drivers who start a shift at 8 a.m. Monday, fire up their navigation system and request a route—all at the same time. Savvy solutions should scale for peak times of usage.

Few do.

Because Omnitracs keeps its navigation data set on the mobile device while publishing changes to the data over the air, we scale easily and provide a more consistent experience for the driver. But it’s not just about timing of data delivery, it’s also about quality. Not only do we leverage traditionally used data, such as posted speeds and traffic light locations, for our routing, we deliver insight into how a particular road was used during Monday morning rush hour, for instance, or on the weekends and holidays.

statistical models from critical event reports, so we can pinpoint black spots or high accident areas.

In short, we’re more than just turn-by-turn instructions. We’re more than just a navigation client on a mobile device. We are a service that publishes data, with a dedicated geographic information system (GIS) team working on that data. And, as we work with our fleets and drivers, we’ll generate new ideas and continue to evolve our solution benefits with our dedicated Big Data team.

RETAINING DRIVERS BY EMPOWERING DRIVERS A lost driver is a distracted driver and a distracted driver is a dangerous driver. Our goal is to provide drivers with the critical information they need in a meaningful, distraction-free way, so they can keep their eyes on the road—a trucker-friendly road.

What’s more, we give drivers an opportunity to be heard and to improve their navigation experience. Omnitracs is the first company to have a closed-loop feedback mechanism, which brings driver feedback about events, such as road closures and map changes, into the data-editing process. Further, a TripAdvisor-like app allows drivers to rate truck stops, restaurants and hotels as well. Empowering the driver to contribute to the development of his or her technology, and see the contribution come to life plays a landmark role in driver satisfaction, and Omnitracs delivers it.

BUILDING A BETTER GPS NAVIGATION APP WITH BIG DATA Omnitracs’ reemergence as “Innovation. Driven.” is built around Big Data and one of the first benefactors is our trucking navigation system.

We’ve taken all of the position data we’ve collected from 250,000 real-world Omnitracs telematics units over a significant period of time, which translates to tens of billions of data points. From that, we’ve built statistical models that generate an enhanced truck-preferred network. Now, we have a better understanding of where trucks go—and, more importantly, where they go safely—better than anybody else out there. We’re also creating

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ABOUT THE AUTHOR RICK TUREK is the chief navigation scientist at Omnitracs LLC and leads the Navigation Center of Excellence. He is responsible for product vision and development for navigation services across Omnitracs business units. Prior to joining Omnitracs, Turek cofounded Maptuit Corp. and spent 12 years as chief technology officer, leading teams that develop industry-leading navigation solutions for the transportation industry. Following Telogis’ purchase of Maptuit, he led navigation-related product development activities. Turek holds a bachelor’s of science degree in mathematics with a minor in computer science from Towson University and a master’s of science degree in computer science from the University of Colorado.

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FEATURE

By Ronnie Garrett

3PLS DRIVING

INDUSTRY CHANGE

3PLs must move in the direction of industry trends to navigate continuous change, rigorous regulations and greater customer demands.

A “Outsourcing to 3PLs remains robust and there is a lot of great opportunity for business growth.”

MARC ALTHEN, PENSKE LOGISTICS

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uthor John Naisbitt has said, “Trends, like horses, are easier to ride in the direction they are going.” When it comes to the challenges facing third-party logistics (3PL), identifying the trends, then doing what it takes to get your 3PL company moving in the right direction, appears to be the best approach.

The reality is third-party logistics has entered a period of rapid change. Its growth has been tremendous—a trend that’s expected to continue well into the future. Technology and mobile applications are revolutionizing the way things are done. And, within this context, 3PL providers are also navigating through a growing regulatory environment and intense competition for business, all while dealing with a labor shortage and increased customer demands. Add to all of that industry consolidation, emerging and disruptive Uber-like supply chain models, and the continued evolution of omnichannel fulfillment, and it is clear that today’s 3PLs must be at the top of their game to thrive.

“The good news is that these challenges are driving more companies to consider outsourcing transportation and logistics functions,” states J. Steven Sensing, president of global supply chain solutions for Ryder System Inc. Marc Althen, president of Penske Logistics, agrees, “Outsourcing to 3PLs remains robust and there is a lot of great opportunity for business growth.”

It’s safe to say that it is an exciting and challenging time to be a 3PL, and the most successful ones will be those that learn to leverage these changes to their benefit. Supply & Demand

Chain Executive recently spoke to 3PLs across the country to identify their pain points and the solutions they’ve launched to drive industry change and successfully meet the challenges of the increasingly competitive 3PL landscape.

COMPLEXITY DEMANDS COLLABORATION “As the world continues to change faster than ever, our challenge is to change just as fast. Supply chains are only getting more complex, requiring a more collaborative relationship between 3PLs and their customers,” reports John P. Wiehoff, CEO for C.H. Robinson Worldwide Inc. Continued globalization is greatly impacting 3PLs. According to Jeff Suchevits, North America head of the industrial vertical at APL Logistics, most companies’ supply chains now include an element of globalization, either because they manufacture outside the continental United States or they buy from suppliers that do. This, he says, has changed supply and demand chain complexity due to factors that include: border crossings, numerous handoffs, more exposure and increased transit times.

“These challenges are introducing new elements that companies cannot afford to ignore when making supply chain choices and with which they often need supply chain help,” Suchevits says.

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

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Third-party logistics is changing as fast as the goods 3PLs are moving. Penske’s Marc Althen says outsourcing logistics services is growing at twice the rate of the economy.

The growth of omnichannel is also impacting 3PLs, reports Duane Sizemore, senior vice president of marketing and business development at Saddle Creek Logistics Services. He says traditional supply chain models that segment processes and departments will not be effective in this environment. The increasing demand to get products where they need to be “quickly, seamlessly and cost effectively,” he says, means it’s essential that “shippers, 3PLs and other partners establish collaborative relationships to ensure optimal omnichannel distribution.”

“With a shortage of capacity and tighter regulations, collaboration is key between trading partners,” agrees John Simonsen, vice president of corporate development at Yusen Logistics Inc. “It is imperative that shippers share their plans and forecasts with their 3PLs, which enables them to plan for capacity, ensure service levels and minimize supply chain disruptions.”

STAND OUT FROM THE CROWD There are a few things 3PLs can do to differentiate themselves from the competition.

Be a Good Partner. All 3PLs interviewed for this article indicated a need for strong partnerships.

C.H. Robinson, for example, has unique and strong relationships with contract carriers that allow it to optimize outcomes, price competitively and solve challenging logistics issues.

APL Logistics developed a number of technology tools for use in the warehouse to containers, in shipping and in rail. The tools increase sustainability and drive efficiency, as well as foster more collaboration among 3PLs and their partners.

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Althen believes in the importance of becoming trusted advisors, and reports Penske achieves this by identifying and measuring key performance indicators (KPIs), which enables customers to clearly define their requirements up front and manage expectations. “We use our technology platform and face-to-face meetings to keep customers informed, and build continuous improvement programs into all processes,” he says.

Excellent KPI alignment with shippers and partners is necessary from the get-go, according to Suchevits. “It’s our job [as a 3PL] to extract specifics from a company. Ideally, this should be done before a contract is signed; that is the best time for both parties to align goals, and establish a fair and equitable arrangement,” he says.

Sensing adds this is not a one-and-done proposition. “We build in ongoing communication protocols, from regular calls and meetings to quarterly business reviews. This ensures constant communication, and the ability to address issues and opportunities as they arise.”

It also helps to have strong relationships and touchpoints at multiple levels within the organization, adds Simonsen, who also points out “relationships may start with a salesperson, but are carried through to the operational level and go all the way to the senior decision-makers.”

Be an Innovator. Another path to success includes being an industry innovator. To that end, APL Logistics developed a multifunctional, simultaneous global optimization tool— ShipmentOptimizer; created an efficient cars-incontainers solution called AutoDirect; developed a warehouse carbon footprint calculator; introduced a robust supply chain collaboration tool known as ShipMax Alliance; and brought private rail solutions—AutoLinx and IndiaLinx—to India.

Innovation also became easier when APL Logistics decided to specialize in four key vertical markets, rather than be, as Suchevits notes, “all things to all companies. We believe our focus on automotive, retail, consumer goods and industrials allows us to do a far better, stronger and more

“As the world continues to change faster than ever, our challenge is to change just as fast.”

JOHN P. WIEHOFF, C.H. ROBINSON WORLDWIDE INC.

SDCExec.com | June 2016 | SUPPLY & DEMAND CHAIN EXECUTIVE

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FEATURE

state of 3PL by the

numbers focused job of providing relevant efficiency and control costs,” solutions and services.”

Sizemore says.

Ryder also puts its focus on Ryder offers TranSync, a patentkey industries—automotive and pending automated tool that Report having difficulty in industrial, consumer packaged provides customers with dynamic finding or attracting talent goods (CPG), retail, technology transportation planning between and health care. “We have private fleets and third-party developed deep expertise in these carriers. The tool helps customers industries and understand their make better transportation Say the use of 3PL services unique challenges. We are also decisions and save money by contributed to overall very good at sharing best practices analyzing the best combination of logistics cost reductions across industries,” states Sensing. transportation modes at the lowest “Something that has worked total network cost in real time. well in a more mature supply chain environment, such as the RECRUIT THE RIGHT STAFF automotive industry, can actually All of these things are for Offer new and innovative ways to benefit a less developed supply naught, however, if a company lacks improve logistics effectiveness chain, like in health care.” the workers to do the job—a very Be Lean. Lean strategies can real concern in 3PL. help 3PLs eliminate waste and drive “Our industry has a massive efficiencies. Saddle Creek ensures need for a wide range of supply Report successful customer ongoing service excellence by chain talent that’s not being relationships that yield positive results establishing a culture of continuous adequately met through the improvement, and incorporating current pipeline,” says Suchevits.

Source: 2016 Third-Party Logistics Study: lean principals to improve processes The State of Logistics Outsourcing “All signs point to this becoming and drive out costs. This is an area APL Logistics even more of a challenge and ultimately limiting has also looked to for improvements. Suchevits transportation flow.” reports the company’s lean initiatives have “garnered 3PLs have had to be proactive and get creative more than $450 million in documented savings since in recruiting workers. For the truck driver shortage, their inception,” and adds that the company was “Ryder has a network of 50 recruiters across the able to “pass along more than half of those savings United States dedicated to recruiting driver talent,” directly to customers.” he says. “And, we partner with the U.S. Chamber of Commerce Hiring Our Heroes program, as well as TACKLE TECHNOLOGICAL TOOLS Women in Trucking.”

The best solutions leverage technology to process As a result, Ryder has seen its U.S. veteran and deliver orders faster, improve inventory visibility workforce grow by 10 percent and its driver and ensure seamless service across all channels. population grow by 12.5 percent year over year.

Saddle Creek has implemented a new warehouse While Penske also recruits diverse populations, management system (WMS) for omnichannel Althen states it has also “ramped up advertising customers. This advanced technology gives efforts to boost awareness of our overall brand, and customers visibility into current inventory, order we’re leveraging a variety of online and social media management capabilities and integrated platforms recruiting tactics.” to readily share information across channels.

Though 3PLs face an ever-changing landscape, The company has also invested in automated all the 3PLs interviewed here agree there are real fulfillment and material handling solutions opportunities emerging in 3PL. “The market for (pick to light, automated label application/ outsourcing logistics services is growing at two to manifesting, etc.) “We’ve also invested in top-tier three times the rate of growth in the economy,” transportation management solutions, including states Althen. “Those providers who bring scale and a transportation management system (TMS), expertise, plus hands-on execution capabilities, will mobile communications and real-time reporting to be well-positioned to grow.” enhance visibility, improve communication, increase

44% 85% 88% 94%

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64% of shoppers say delivery speed is important when buying online.

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MADE IN AMERICA

By Cynthia Y. McCann

This story begins with a handshake, a hearse and a boot company.

Photos Credited to: Cynthia Y. McCann

R E T S U B T E K ROC e d a m Hand S T O O B M O T CUS

I

n Texas, some of the best business deals are still made on a man’s word and a handshake, and yes, even a little tequila on occasion. One such deal was 24

made in 1989 in El Paso, Texas.

Marty Snortum was a photographer who had a passion for classic, vintagestyle cowboy boots. One night at a local bar, Snortum ran into an

acquaintance who owned a floundering boot company named Rocketbuster Boots, which the man named after his Oldsmobile Rocket 88. Snortum had a 1953 Cadillac hearse at the time,

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MADE IN AMERICA Rocketbuster’s team of highly skilled artisans uphold the art of custom boot making in El Paso, Texas.

which, after a few drinks, became the enticement for this gentleman’s deal.

Just like that, Snortum’s passion for bringing classic cowboy boots back in fashion became a reality. He traded his Cadillac hearse for the Rocketbuster name, two skilled craftspeople and a couple of sewing machines.

Today, Snortum and his wife, Nevena Christi, are the owners of Rocketbuster Handmade Custom Boots. Thanks to them, the art of classic cowboy boot making is alive and well in America.

BOOTS THAT TELL A STORY

she was working on a runway show.

The show needed Rocketbuster-style boots, she met Snortum, and life was never the same.

Christi left the swankiness of New York City for the slower-paced desert town of El Paso. She brought her high energy and New York City flair, along with her fashion knowledge and design skills, to Rocketbuster, and never looked back. On most days, Christi is in her office designing the intricate and outlandish boots that customers are willing to wait months for. No request to tell a story on a pair of boots is ever turned down and it is what makes Rocketbuster Handmade Custom Boots different from other boot makers.

When asked about competition, Christi replies, “We don’t have any competition. We have a sixmonth waiting list. Nobody is doing what we do. Our Owner Nevena Christi is pictured with the customers know we are world’s largest boot, going to make them what according to Guinness they want.”

World Records.

You can’t help but notice the distinct and funky brick warehouse on Anthony Street in downtown El Paso.

It stands alone with Rocketbuster Boots painted above the loading dock and unassuming entrance door.

One step inside, however, and the scene is vibrant and exciting. There are neon signs, pinball machines, giant aliens and other whimsical pieces that make working at Rocketbuster a happy, creative and motivating environment.

The artists and craftspeople are held to a very high standard for creating one-of-a-kind, wildly artistic, handtooled and hand-stitched leather boots.

Rocketbuster produces approximately 400 boots a year. Every pair of boots is created completely by hand, in line with traditional boot-making techniques.

Today, Christi runs Rocketbuster single-handedly. Years ago, Christi, who studied design in Europe, left a successful fashion career working for Nicole Miller in New York City. Fate brought her to El Paso in 1995 when

KEEPING A LOST ART ALIVE El Paso is the boot capital of the world, and home to world-class boot makers like Lucchese, Tony Lama, J.B. Hill, CABOOTS, Mingo, Tres Outlaws and others. All told, about 49 boot makers are located in El Paso, according to the El Paso Regional Economic Development Corporation.

Second- and third-generation boot makers make up this skilled labor force, and use their skills and expertise to create some of the most beautifully handcrafted boots in the world.

At Rocketbuster Handmade Custom Boots, employees are cross-trained to do different jobs. The art of boot making has to be practiced. Yet, it’s an

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art that is finding it difficult to attract new craftspeople.

“El Paso is the boot-making capital of the world as far as cowboy boots. It’s so essentially American,” says Christi.

At the same time, the craft is losing the keepers of the art of boot making, while supplies are dwindling and manufacturers are outsourcing to China.

“We need to keep this in El Paso.

It’s unique to El Paso,” she says.

Today, a lot of traditional cowboy clothing and footwear is manufactured overseas. Cost increases are a primary driver in moving production to low-cost countries. But, there is clearly a demand for quality, handcrafted boots that are made in America, and customers are willing to pay a premium for them.

Rocketbuster boots start at around $900 and can easily reach into the thousands of dollars. Customers ranging from CEOs to politicians to celebrities to everyday people who appreciate high-quality and unique boots do not mind paying more for something so historically grounded in American culture.

How important is it to Rocketbuster, and its customers, that the boots are made in America? Christi says, “It’s absolutely important! Cowboy boots are an essential part of American art. It would be a pity if all that were lost. We are helping keep a tradition alive.”

ABOUT THE AUTHOR CYNTHIA Y. MCCANN is a Los Angeles-based photojournalist whose work has appeared in several B2B supply chain journals, including World Trade WT100 and Food Logistics. Her artwork appeared on the front page of The Los Angeles Times as part of the newspaper’s coverage of the Surfin’ Hermosa art exhibit in 2004.

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SPECIAL REPORT THE INTERNET OF THINGS

By Ronnie Garrett

The ascent to the IoT summit requires manufacturers to think strategically and take a stepped approach to implementation.

CLIMBING

THE IOT MOUNTAIN

A

dding the Internet of Things (IoT) to the manufacturing process is a lot like standing at the foot of Mount Everest, ready to climb the world’s tallest mountain. You know you want to get to the top, but you aren’t really sure how to get there or what obstacles you may encounter along the way.

The good news is manufacturers do not have to implement IoT all at once.

They can take small steps to get to the top—a place where they’re capturing all information from the shop floor and along the supply chain in real time, then turning that data into actionable insights.

Also good is the fact that there are already some successful manufacturing pioneers who paved the IoT highway for others to follow. General Electric Co., for example, employs 10,000+ sensors to measure temperature, humidity, air pressure and production machine data in real time at its

IoT by the

numbers

24%

24%

State they plan to implement IoT technology over an unspecified timeline

Report having no plans to implement IoT technology

1/3

Of U.S. manufacturers report that they currently use IoT

Source: “Building an Internet of Things Manufacturing Ecosystem” PricewaterhouseCoopers LLP

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Durathon battery plants.

The company uses the data it collects to monitor production and adjust processes in real time, and trace battery performance back to specific batches and steps in the manufacturing process.

CONNECTED MANUFACTURING IDC Research Inc. reports in its white paper, “IoT and Digital Transformation: A Tale of Four Industries,” that where the IoT is employed in manufacturing may vary by manufacturer. It predicts companies that own their facilities may be early adopters of the IoT in the plant, while those making products with longer lifecycles may use the IoT in products and services.

The report stresses that the IoT is making its way into products and processes. By leveraging the IoT to create connected products, companies can now offer IoT-enabled services to customers. And, they can employ the IoT on the shop floor to increase efficiency and effectiveness in their operations. “The benefits are many— increased capacity on production lines, easier product customization, and tighter links between supply and demand,” the white paper states.

With the IoT, companies can engage in on-demand manufacturing at a higher level than ever before, states Kevin Lyons, associate professor of professional practice of supply chain

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SPECIAL REPORT THE INTERNET OF THINGS

management at the Rutgers Business School. “In the past, manufacturers produced as much product as they possibly could and, if they didn’t sell everything, then they had piled up inventory. With the IoT, you can pinpoint what production is needed, where and how much in real time.”

With the right amount of the IoT in place and a streamlined supply chain, Lyons says companies can trim costs from the manufacturing process and reinvest that money into other technological advances, which in turn, can save money on the labor side.

Dr. Achim Krüger, vice president of operational excellence solutions at SAP, stresses that, with the IoT, there is “a lot more information available from products or assets that can help manufacturers make optimal decisions.

The IoT is about combining data from the business and the shop floor to make better business decisions.”

❯❯ Are employees using the data optimally?

“It’s not a one size fits all,” Bono stresses. “Every company has different data needs.” One company may seek to reduce its energy costs, while another may want to identify what is leading to a larger than acceptable number of product returns.

machine-to-machine coordination of pieces on the assembly line, so a change in the condition of Component No. 1 triggers a change in the operation of Component No. 2 and so on down the line. Stephenson says, “I refer to this as precision manufacturing and the IoT will allow manufacturers to do that to an extent that was never possible before.”

Getting realtime feedback on manufacturing processes can help companies gain efficiency. Sensors, for example, can identify the greatest consumers of energy in the manufacturing process.

“Manufacturers can then look for ways to be more efficient,” Bono says.

“Maybe they can do those things at different times of the day, when energy costs are lower. Or maybe there is an alternative process that would use less energy.”

Sensor data can also help companies make sound decisions about their supply chains. For example, it may help them determine if they should source a subcomponent or make it themselves.

“You may find it’s more efficient to make subcomponents,” Bono says. “Or maybe you realize the subcomponent you currently make consumes too much energy during the manufacturing process and it’s cheaper to outsource it. With the IoT, you can adjust your supply chain, but you are using hard data to make those decisions.”

Perez takes the use of the IoT in manufacturing a step further and predicts a day when IoT and Big Data merge with 3D printing.

“Companies can use this data to determine which parts they want now, which ones make sense to digitize and 3D print, and where it is most financially feasible,” he says.

“WITH THE IOT, YOU CAN PINPOINT WHAT PRODUCTION IS NEEDED, WHERE AND HOW MUCH IN REAL TIME.” KEVIN LYONS, RUTGERS BUSINESS SCHOOL

W. David Stephenson, owner of Stephenson Strategies, a firm helping companies implement the IoT, believes the assembly line is a good place to start. Here, sensors can provide information about equipment performance, product design and usage patterns to improve processes.

PUTTING IOT DATA TO USE The benefits of the IoT really add up once sensors are in place.

Placing sensors on capital equipment can provide advance warnings of potential problems, so workers can perform predictive maintenance rather than rely on scheduled maintenance. It may also allow companies to schedule maintenance intervals because the data accurately shows when work really needs to be done. These improvements can reduce production downtime due to equipment failures.

“These devices can predict when machines are going to break down, so you can fix them before they break,” according to Gil Perez, senior vice president of digital assets and IoT at SAP. Putting sensors on production equipment may also improve operating efficiency because companies can do

GETTING STARTED Bobby Bono, U.S. industrial manufacturing leader at PricewaterhouseCoopers LLP (PwC), recommends companies ask key questions to set IoT goals, then strategically implement the technology over time. The following questions can help craft an IoT strategy: ❯❯ Did you conceive an IoT ecosystem strategy? ❯❯ Are you considering Internet protocol (IP)-enabled products that can lead to after-sale services? ❯❯ Do workers need retraining to build an IoT strategy? ❯❯ Did you identify what and where data can be collected? ❯❯ Are you squeezing enough meaning out of the data you collect?

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SPECIAL REPORT

By Ronnie Garrett

PROCUREMENT

Shake Off the

CAVEMAN MENTALITY

I

f chief procurement officers (CPOs) were to take a Neanderthal approach to their jobs, it may look something like this: Whack suppliers over the head with clubs to compel them to do what they want, then storm the C-suite and force executives to listen to their ideas.

Unfortunately, caveman mentalities have no place in today’s business world, so CPOs must take a more finessed approach to their duties.

Collectively, individual CPOs’ approaches to business problems may differ, but recent surveys, such as those done by The Hackett Group Inc., Deloitte Consulting LLP and Ardent Partners Ltd., of top procurement officials illustrate that the challenges they face are largely the same: Reducing CPOs who identify partnering with spend, managing risk, the CFO as critical to their mission becoming trusted advisors to the C-suite, fostering innovation, Number of CPOs who improving agility and believe their team lacks the skills filling procurement and capabilities to deliver their procurement strategy offices with the right CPOs stating cost reduction kinds of talent. is their top priority “I see four main issues: Cost, innovation, supply chain disruption and bringing talent to Report procurement lacks a clear procurement,” states digital strategy Tania Seary, founding chairperson of Source: Deloitte Consulting LLP’s 2016 Global Chief Procurement Officer Survey

There’s no room for a Neanderthal approach to procurement.

Surveys identify procurement’s top challenges and indicate a need for CPOs to take a strategic— and finessed— approach.

96%

62% 74% 60% top CPO challenges by the numbers

28

Procurious, an online business network for procurement professionals.

Studies are echoing what Seary is saying. Ardent Partners, a research and advisory firm focused on advancing supply management strategies, processes and technologies, recently surveyed 330 CPOs and other procurement executives. The study found that, while the top challenges facing procurement shift up or down in order from year to year, they tend to include the same handful of issues. Top issues include things like cost containment, talent needs and disruption.

“These issues are all C-suite issues,” Seary states. “There is a direct link between what CPOs are doing and what the C-suite is worried about. As such, there is a lot that can be done and there is a great opportunity for procurement professionals to be a part of it.”

COST CONTAINMENT IS KEY In 2016, Ardent Partners’ survey respondents identified the pressure to find more savings as their top concern.

While this could spell doom and gloom on the business front, since cost containment is directly tied to challenging economic times, Andrew Bartolini, managing partner and chief research officer at Ardent Partners, points out that, in 2009, nine out of 10 CPOs reported finding more savings as their top challenge. Yet, in 2016,

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SPECIAL REPORT PROCUREMENT

just one in three CPOs cited this as their top concern.

Christopher Sawchuk, principal and global procurement advisory practice leader with The Hackett Group, an intellectual property-based strategic consultancy, states Hackett’s 2016 global survey of procurement executives also found the priority shifted back to cost. “The question is why? Certainly, some of it is due to the economic challenges that we’ve seen in some industries. In a revenue-challenged environment, procurement focuses more intently on cost in an effort to enable the companies it supports to maintain their margins.”

However, Sawchuk warns, “We can’t save ourselves to success. There is a diminishing level of return over time.”

That being said, Seary reminds that cost is always going to be a top priority. Strategic purchasing, leveraging technology and sourcing newer (less costly) materials are all ways to contain costs. “It is the biggest value we can bring to a business. We own this space,” she says.

Study, it was identified as procurement’s top objective. In 2016, it remains a key priority for CPOs looking to generate additional value and expand their

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A SEAT AT THE TABLE The studies also reveal a continued need for CPOs to better explain “the value proposition of what they bring to the organization,” Bartolini says.

There is a definite need to elevate the procurement professional to that of a trusted advisor, agrees Sawchuk. He points out that, in 2015, the first year that “elevating the role of procurement to a trusted advisor” appeared in The Hackett Group’s annual Key Issues

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“We can’t save ourselves to success.”

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SPECIAL REPORT PROCUREMENT influence within their organizations.

And that’s a good thing. “The idea of becoming a trusted adviser should not be an end goal in and of itself. It’s an enabler,” Sawchuk says.

Seary emphasizes that CPOs must define value and construct metrics around key business issues that align with the goals of the C-suite. “They cannot simply focus on cause and transaction-type metrics: the number of suppliers reduced, the number of contracts renewed. These are not business metrics, they are procurement metrics,” she says.

CPOs should consider developing a balanced scorecard, such as Ardent Partners’ CPO Scorecard, to measure procurement’s performance against metrics that include: ❯❯ Hard financial metrics, such as

savings and cash flow impact. ❯❯ Stakeholder metrics, such as supplier performance and risk, and internal customer feedback. ❯❯ Process and technology metrics that measure procurement efficiency and activity. ❯❯ People and knowledge management metrics, which look at staff competencies, training and retention.

Developing these metrics with the company CFO can help CPOs deliver a broad-based report card that demonstrates how procurement is performing in a range of areas, according to Bartolini. It also helps CPOs put their company’s business into the context of what’s happening in the world and how they can add value to the business moving forward.

“Procurement is the group on the front lines ensuring that the innovative suppliers, the strategic suppliers, the leading suppliers in the market are the ones working with the company,” he says. “If you’re going to be more reliant on your supply chain, you need an organization to manage it more effectively, communicate goals and objectives, and make sure that the supply chain is the right supply chain.”

But there is a disconnect, he warns.

Ardent Partners’ survey found that twothirds of procurement organizations fail to align their objectives with those of the enterprise as a whole. “If it’s not important to the C-suite, it should be significantly less important to the procurement organization,” he says.

Procurious’ Big Ideas Summit supported this finding. CEOs and

CULTIVATING TALENT

to Keep Procurement at the Executive Table

By Brian Umbenhauer & Ryan Flynn

A SEASONED PROCUREMENT EXECUTIVE at a fast-growing American apparel company describes himself as “old enough to be the dad of 98 percent of the people” who work at his company. But when he opens his mouth, everyone listens. Why? Because younger professionals within his company have little practical understanding of how to run a supply chain. Everyone from the CEO down to district and regional managers are finally getting it.

How? He went old school: They learn by doing.

This issue is not new. Deloitte identified a looming talent crisis in its first Global CPO Survey in 2011. Five years later, however, the concern is becoming more real and more immediate. Progress is slow in building core capabilities around talent and there remains a long way to go.

This executive helped create a rotational program that includes procurement for high performers. The bottom line for the company is that procurement is front and center at helping ensure that it has the right products at the right place and at the right time. The rotational program ensures the company has the right talent in place and eases some of the challenges procurement faces internally.

1. ASSESS CURRENT TALENT versus the company’s strategic objectives.

Where are the biggest gaps?

This seasoned CPO is addressing what Deloitte Consulting LLP recently confirmed in its fifth annual 2016 Global Chief Procurement Officer Survey.

Participants in the survey indicated procurement is maturing, but warned they may not have the requisite talent to maintain its position in the organization going forward. In 2014, 57 percent of CPOs responded that their teams did not have the skills or capabilities to deliver their procurement strategy. This year, that number increased to 62 percent.

As the need grows for procurement to get the right mix of talent on their teams to effectively execute more complex strategies, there are several things companies can do right now to help advance the potential of procurement:

2. ESTABLISH A PLAN to mitigate any gaps.

3. UPSKILL TALENT through regular targeted training and mentoring.

4. HIRE FOR AND DEVELOP the right combination of hard and soft skills to enable increased engagement with business teams and suppliers.

5. HIRE NEW TALENT. Procurement is transforming itself into a more strategic function and needs talent where it didn’t exist before.

6. CULTIVATE EXISTING TALENT. Look within the organization (even beyond procurement) for talent that can be mentored and grown into the effective procurement leaders of tomorrow.

BRIAN UMBENHAUER is a principal at Deloitte Consulting LLP, and leader of its global sourcing and procurement practice with 20 years of industry and consulting experience across the supply chain. RYAN FLYNN is a principal with Deloitte Consulting LLP’s sourcing and procurement practice, with more than 14 years of experience helping leading global companies improve their sourcing and procurement efficiency and effectiveness.

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SPECIAL REPORT PROCUREMENT CFOs in attendance reported they wanted to hear how procurement is changing the whole value chain, thinking of new ways of doing business and capturing the benefits of new technologies, Seary reports.

weaving agility into every dimension of their operating model.”

He adds, “There are a lot of things changing and they are going to change with more velocity than we have ever seen before. Our ability to be agile in this environment is a critical capability.”

READY TO MOVE

“If it’s not important to the C-suite, it As companies brace for continued business should be significantly less important uncertainty and to the procurement organization.” increased risk, along with elevated struggles ANDREW BARTOLINI, ARDENT PARTNERS to grow revenue, procurement must ready itself for these Sawchuk recommends the following changes. Here agility is important. to help CPOs improve their agility: “Agility means you have the ability 1. Apply the agility test to your to adapt quickly to environmental own procurement service delivery changes,” says Sawchuk. “Organizations model. Find the gaps and need to ask themselves how they are determine what needs to change.

2. Evaluate your current supply risk

management program for depth, speed and agility.

3. Invest in predictive capabilities; pilot emerging technologies.

4. Work to expand existing supplier networks into interconnected business communities.

Ardent Partners’ CPO Agility Agenda can also help CPOs “operate predictably in the face of uncertainty, complexity and constant change.”

Available at www.ardentpartners. com, this tool helps CPOs assess their organization’s agility strengths and weaknesses in four key areas: organizational structure, procurement strategies, technology and performance.

CPOs can then take action to improve in the areas identified as weaknesses.

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SPECIAL REPORT TRADE FINANCE

By Lara L. Sowinski

EXIM Bank Looks to

PROVE ITS WORTH

Six months after its reauthorization, the U.S. Export-Import Bank is keen on showcasing its value to big and small firms alike.

F

ollowing a lengthy political battle, the Export-Import Bank of the United States (EXIM) failed to win reauthorization from Congress last year, forcing the bank on July 1, 2015 to refrain from approving new authorizations or engaging in business development. It was somewhat shocking, considering that over the bank’s 80-year history, it was reauthorized 18 times with overwhelming bipartisan majorities.

The five-month-plus waiting period before the bank was reauthorized in December (extending its charter until September 2019) was an “ordeal,” conceded EXIM bank chairman and president Fred P. Hochberg in an interview with Reuters.

Lawmakers who spearheaded the move to prevent reauthorization of the bank’s charter claimed the bank was a source of “crony capitalism” and “corporate welfare.” Multinational firms like The Boeing Company and General Electric Co. were frequently cited as companies that benefited from the bank’s export financing services.

Yet, Hochberg said that small businesses are equally important to the bank and he is concentrating on repairing relationships with small businesses that lost trade insurance policies as a result of the failed reauthorization last year. Indeed, a new mandate specifies that small businesses must comprise 25 percent of the bank’s 32

annual loans, loan guarantees and trade insurance—up from the previous threshold of 20 percent.

SMALL IMPORTERS FACE UNIQUE CHALLENGES A recent survey from the Small Business Exporters Association (SBEA) reveals unique challenges faced by small exporters, including financial challenges that organizations like the EXIM bank can address. Here are several exporting takeaways the bank highlighted from that survey:

Receipt of payment in advance is far and above the preferred payment term.

Which of the following methods of payment do you accept from foreign customers? Any business owner can tell you that getting paid up front is preferred, especially when it comes to overseas sales. When that’s not an option, the shorter you can keep open account terms extended, the better. That does not mean those are your best or only options. EXIM export trade credit insurance can broaden your options for how you extend open account terms by insuring your foreign receivables.

For many firms, finding financing for export operations is no harder than domestic operations.

Would you say securing financing for your firm’s exporting operations

is more or less difficult than securing financing for traditional business operations? Many firms assume that exporting is time-intensive and complicated, and finding the right financing options is a big part of that.

However, 61 percent of respondents found that accessing export financing is about the same as domestic financing. While circumstances vary, many inexperienced exporters encounter more difficulty because they don’t know where to go to solve the problem at hand. However, more experienced exporters are more aware of and better able to leverage powerful resources, such as U.S. Export Assistance Centers, trade credit insurance and working capital loan guarantees, and turn to the right resource the first time and find things much easier.

Concern around getting paid is the biggest challenge when selling to foreign customers.

What do you consider the largest challenges to selling your goods and/ or services to foreign customers?

Forty-four percent of exporting respondents cite “worrying about getting paid” as their biggest exporting challenge, which aligns with another takeaway that outlined the general preference of exporters to receive cash in advance. There are, of course, many reasons why this may be, but what EXIM came to realize is many firms that want full payment in advance and worry about getting paid don’t know about the options to mitigate those concerns with trade credit insurance and working capital loan guarantees.

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

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EXECUTIVE FOCUS

{ TRANSPORTATION}

By Mindy Long

RAIL

PICKS UP STEAM

Rail and intermodal are supporting the

supply chain with infrastructure investments and efficiency improvements.

Elizabeth Hill, general director for temperature-controlled intermodal at BNSF Railway Company, says the pressures facing the trucking industry as a result of regulatory activity, such as the mandate requiring electronic logging devices, will continue to grow, creating more opportunities for the rails. The railroads are capitalizing on the market opportunities by investing in infrastructure.

INVESTMENTS AIM TO KEEP RAIL COMPETITIVE

F

rom consumer goods to automobiles and perishable products, an increasing number of shippers are finding that transporting products via North America’s Class I railroads remains a cost-effective method of transport, while rail and intermodal transportation providers say they are supporting the supply chain with faster deliveries, infrastructure improvements and improved tracking capabilities.

At the same time, rail and intermodal providers are seeing an uptick in demand driven by increased regulations within the trucking industry. Paul Esposito, executive vice 34

president of corporate affairs for Railex LLC, a refrigerated third-party logistics provider, says shippers today are in the position to use the best combination of modes to meet their needs.

“They can put basically anything they want to via rail so long as it allows the inventory to be handled in a boxcar manner,” he says.

Rail is gaining market share from trucks, Esposito adds. “The influx of intermodal and intermodal containers is making the conversion from truck to rail happen easier,” he notes, explaining that low diesel prices slowed the move to rail, but that he expects it to come back when fuel rates equalize.

The Association of American Railroads (AAR) states that the U.S. freight railroad system invests $26 billion annually in its network.

“While perhaps out of sight and out of mind to many Americans, U.S. freight railroads play an integral role in supporting the health of the nation’s infrastructure,” says Edward Hamberger, CEO of the AAR. In 2014 and 2015, BNSF made an $11 billion network investment, adding more than 200 miles of double-track, 875 miles of centralized traffic control to help manage rail traffic, 18 new sidings and 25 extended sidings. BNSF also made a $3.5 billion investment on its Northern Corridor route.

BNSF is also completing a new bridge and secondary track in New Mexico, which means that all but four miles of the approximately 2,200-mile

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

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Southern Transcon route connecting the West Coast to major intermodal markets, such as Chicago, Dallas/ Fort Worth and Kansas City, will be double-tracked this year.

Port Panama City in Florida is slated to double its throughput capacity with the development of a new railserviced forest products terminal. The port acquired a 41-acre waterfront tract from WestRock Company for the terminal, which includes a 250,000-square-foot warehouse for wood pulp, linerboard and related goods; a 48-car capacity rail yard; a refurbished 38-foot draft berthing area; and a 10-acre laydown area.

Genesee & Wyoming Inc.’s Bay Line Railroad, which interchanges with CSX Transportation and Norfolk Southern Railway, will service the Panama City Port Authority. Wayne Stubbs, the port’s executive director, says the terminal will position the port to handle sustained volume growth well into the future.

“Exports of paper and wood pellets helped propel the port to a record year in 2015, with more than 2 million tons of cargo moving across our docks,” he says.

Florida East Coast Railway (FECR), a regional rail provider that’s 351-mile system runs along the eastern coast of Florida, worked closely with PortMiami to reintroduce on-port rail service. PortMiami partnered with the railroad, the U.S. Department of Transportation (DOT) and the state of Florida to invest nearly $50 million to connect the port with the railroad’s Hialeah intermodal yard and the national rail system.

Establishing on-dock intermodal rail service opened new markets for the port and for FECR, allowing containers at PortMiami to load directly onto awaiting trains, with

FECR delivering truck-like service in we’re in a good range when it comes certain markets. to rail being much more competitive FECR offers delivery within the for us,” he says, adding that rail allows southeastern U.S. in two days. “Beyond shippers to avoid the hours-of-service Florida, we connect to 70 percent of regulations the trucking industry faces. the U.S. population within four days “The downside is you can’t ship rail to via steel-wheel interchange with two every place.”

Class I railroads in Jacksonville,” says As part of their overall Adam Bridges, senior vice president of improvements, railroads are focusing marketing and strategic planning for on ways to speed transit times, which Florida East Coast Railway. can help draw certain commodities to Charles Penrow III, manager of the rail, Penrow adds.

U.S. logistics and U.S. DOT “Our speed and consistency is especially compliance at critical to our fresh food customers who McCain Foods USA, states the rely on us to help them extend the speed and on-time shelf life of their products.” performance of the railroads increased over ELIZABETH HILL, BNSF RAILWAY the past year as coal and oil shipments decreased.

For example, “It is not necessarily that they’re Union Pacific performing better. It is that they have Railroad created a direct food train less congestion,” he explains. that originates in either California or The AAR reports that coal Idaho, and heads East, shaving days shipments were down 29.6 percent off of transit times. “I think the rails in May 2016 compared to May 2015. are getting smarter in looking at those Other commodities seeing decreases opportunities,” he remarks. were petroleum and petroleum product BNSF’s expedited intermodal loads, which were down 20.3 percent service averages a transit speed of year over year for May, and metallic approximately 800 miles per day. ores were down 12.9 percent over the “Our speed and consistency is same period last year. especially critical to our fresh food Herman Haksteen, CEO of Cryocustomers who rely on us to help them Trans Inc., says a large portion of the extend the shelf life of their products,” transportation industry is interested in says Hill. boxcar rail, which he says is the most BNSF offers the only expedited efficient way to move goods across service to and from Seattle, and also the country. offers expedited service to and from “You have a lot of things that people Chicago and Saint Paul, Minnesota, to think is from the past, but the past the Pacific Northwest, Hill says. is making a pretty strong comeback, ABOUT THE AUTHOR and it is surprising how many large companies have rail in the supply MINDY LONG is a writer specializing in chain,” he says. transportation and logistics. She has been writing professionally for more than 15 years.

One rail car can hold three-and-ahalf truckloads, Penrow says. “Typically,

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EXECUTIVE FOCUS

{ WAREHOUSING}

By Carrie Mantey

The Case for

WAREHOUSE AUTOMATION

T

here are myriad warehouse automation solutions on the market today. There are also several levels of automation—from semi-automated to fully automated and everything in between. The important question, then, is what kind of automation system to select based on the goals you are trying to achieve.

“There’s no one size fits all in warehousing; everything has to be thought about in the context of what problem you’re trying to solve. It really depends on how big the facility is, how you want to balance operating expense against capital expense, what your buy-ins are and how big a company you are,” according to Bruce Welty, co-founder of Locus Robotics.

GOODS TO PERSON, AND AUTOMATED STORAGE AND RETRIEVAL SYSTEMS More warehouses and distribution centers (DCs) are seeking goods-to36

Photo credit: Witron

From goodsto-person technologies to mobile autonomous robots, warehouse automation solutions improve operational speed and productivity. person (GTP) technologies when considering automation. The GTP concept is simple. Instead of workers traveling to the items to be picked, the items are brought to the worker.

According to Nathan Busch, associate consulting engineer at Bastian Solutions Inc., “The throughput rates of GTP systems are typically quite a bit higher than traditional manual operations. This allows companies to reduce their overall operating and order fulfillment costs, while improving throughputs and service levels.”

There are a few different types of GTP systems. Busch elaborates, “At the highest level, automated storage and retrieval systems (ASRS) are examples of GTP technologies because rail-guided cranes traverse storage aisles and levels to store and retrieve materials from pick-up and drop-off points. These pick-up and drop-off points interface with other materialhandling equipment that eventually bring the materials to the point of use.”

There are also shuttle-based systems, which are ultra-capacitor or battery powered, in the GTP mix. Shuttles traverse each level of each aisle, and each level has at least one shuttle to handle loads. Busch continues, “Another even more modern shuttle system is one that utilizes lifts at the ends of the storage aisles. The shuttles still traverse the length of the storage aisles, but this type of system allows for the shuttles to travel to other levels within a given aisle. This creates flexibility by allowing access to all inventory within a given aisle, as well as flexibility when determining investment costs for throughput versus the quantity of shuttles required.”

PICK-TO-LIGHT SYSTEMS Pick-to-light warehouse automation uses lights above racks or bins to direct pickers where to pick. The user simply scans a barcode on a picking container. Then a light above the rack or bin illuminates with the picking

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

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WAREHOUSING

quantity, and the user picks the items for the order, corroborating the pick by pressing the light.

Adam Kline, director of product management at Manhattan Associates, thinks, “Put to light tends to be a nice way to ratchet up picking capabilities, especially in an e-commerce environment, to be able to meet peak season demand. I think that a lot of the automation trends that we’re seeing are due to that peak and seasonal demand.

Ratcheting up and being able to grow your fulfillment capacity by six, seven times, and sometimes, all the way up to 20 times average demand” during the peak season is crucial.

travel to an inventory location. Then a light on the robot illuminates to indicate that a worker patrolling the zone needs to pick an item from the indicated location in a specific quantity.

The warehouse worker picks the item, then scans it with the robot’s scanner, and drops the item in the bin. The robot then travels to the next spot for the next pick.

Welty says, “The workers monitor their zones, looking for the robots’ signals and respond to the requests.

The collaboration between robot and worker dramatically improves efficiency. The associate completes the pick faster and is thereby able to complete more pick requests.

With our robots, workers are able to pick faster and more productively than with traditional Photo credit: Witron manual picking.”

MOBILE APP PICKING When it comes to picking, Kline sees a lot of potential growth in equipping end users with a more modern, mobile experience. Rather than having DC workers wield a large, difficult-to-use RF scanner, he envisions them using a smartphone or tablet equipped with a mobile app for picking. The app elucidates instructions so that it’s easy to walk the user through his or her job functions. The app that Manhattan Associates produces even “offers a view of the item that’s expected to be picked so that temporary workers [who may not be familiar with the inventory] can ensure they’re picking the right item.”

WAREHOUSE AUTOMATION BENEFITS “Warehouse automation solutions help optimize operations and efficiencies by performing redundant tasks that are typically performed by operators in a manual operation,” Busch says. “Automation helps by removing waste from an operator’s typical work, which may include waiting, travel time and motion. When implemented correctly, automation allows operators to focus on the tasks that require human intervention and leaves the other tasks to the equipment.

Typical ASRS and GTP systems have higher throughputs than traditional or manual operations because of the waste that is removed, reducing operating

MOBILE AUTONOMOUS ROBOTS Locus Robotics offers mobile autonomous robots that can go anywhere in the warehouse. The robots

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and order fulfillment costs, while increasing throughput capacities.”

When compared to a manual warehouse in which workers operate off of paper instructions, yet must log their productivity in a system to keep track of inventory movement, Kline says, “The leap from a manual process to a warehouse management system in which everything is typically driven based off of barcode scans, real time or voice-enabled flows is massive—especially from a productivity perspective. Because the system is constantly feeding you the next bit of work, you never have to go back to your supervisor to get your next pick list, for example. You’re not wasting that travel time. It’s generally increasing the speed at which you can fulfill orders, which ultimately makes for happier customers.”

Another advantage of implementing warehouse automation is that it reduces a warehouse’s dependency on labor, especially in the face of the everincreasing talent shortage. Another factor is that many young workers have a disillusioned view of the warehouse as being a generally unattractive place to work. Automation may help reverse this trend because, the more automation a warehouse employs, the more employees are needed to operate and maintain the equipment as opposed to suffering through the repetitive bending and lifting in a traditional manual warehouse.

Additionally, Norman Leonhardt, director of business development at Witron, notes that, in some countries, “regulations are very strict, limiting, for instance, the amount of weight that each worker can lift every day. In the end, automation actually seems like an easier solution because regulations are pushing toward automation.”

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EXECUTIVE FOCUS

{ SOFTWARE & TECH}

By Elliot Maras

ERP OFFERINGS BECOME MORE VERSATILE, Expand User Choices

O

Cloud and SaaS ERP deliver faster and easier access for enterprise customers.

38

ne of the most difficult decisions supply chain organizations face is investing in enterprise resource planning (ERP) software, be it the company’s initial foray into this area or the need to replace an existing system. With a plethora of systems available, and the capabilities unleashed by cloud ERP and softwareas-a-service (SaaS) ERP, the decision of what system to invest in becomes extremely complicated.

Yet, given the rapid pace of change that most organizations face in their own business environments, choosing the right ERP can be the most important decision they ever face.

Evaluating ERP needs requires a committed leadership that understands the organization’s long-term goals.

Organizations often focus on immediate needs only to eventually consider a new solution in the face of changing market conditions, new regulations, and geographic or product expansions. To prevent this, they need scalable solutions that support future growth and new technology.

The Hershey Company, a global confectionery and snacks manufacturer, fully understands the value of making the right ERP choice. The company witnessed consistent market share growth thanks to its ability to derive insights from data, according to John P. Bilbrey, chairman, president and CEO. The company recently signed on

to implement SAP’s S/4HANA ERP platform to help its employees move from being reporters of data to using data for active decision support in real time.

When asked what area of the business gained the most from his enterprise connectivity vision, Bilbrey’s answer was the supply chain. Improved visibility allowed the company to avoid 20 million pounds of otherwise wasted corrugated cardboard in shipping and merchandising. And the organization is looking forward to even more endto-end visibility into the supply chain as the ERP initiative progresses.

KEY ERP TRENDS One trend is that of two-tier ERP, defined as the practice of running two ERP systems at once—one larger system at the corporate level, and one smaller system at the plant, division or subsidiary level. Two-tier ERP systems make sense when an organization has an existing ERP system, but operates satellite operations that require unique functionality for local markets. The larger system can create difficulty in operations and not address

IMPROVED VISIBILITY ALLOWED THE COMPANY TO AVOID 20 MILLION POUNDS OF OTHERWISE WASTED CORRUGATED CARDBOARD IN SHIPPING AND MERCHANDISING. — JOHN P. BILBREY, THE HERSHEY COMPANY

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

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SOFTWARE & TECH

local variances, such as regulatory issues. In such a case, the satellite office uses a smaller cloud ERP. The two-tier solution also proves popular for organizations that acquire other operations with their own ERP systems.

“In a two-tier deployment scenario, an organization running a legacy on-premises ERP system for its administrative work may not give it the pace and flexibility required for its operational units, such as plant operations, sales and service, and subsidiaries,” says Umran Hasan, senior marketing manager at Microsoft.

“In such cases, it can deploy a cloud solution like Microsoft Dynamics AX and integrate it with its on-premises administrative ERP system.”

Kevin Beasley, chief information officer at ERP provider VAI, says the

two-tier option often makes sense when an acquisition occurs. Integrating the two companies’ data can take years.

In 2013, Shaw Industries Group Inc., a carpet manufacturer with more than $4 billion in annual revenue, deployed NetSuite cloud ERP to run a manufacturing plant in China and 10 international subsidiaries. One factor was the need for a rapid installation. “[The cloud ERP] enabled it to get up and running more quickly and agilely,” says Ranga Bodla, wholesale distribution industry lead at NetSuite.

“Shaw Industries has an Oracle onpremises ERP at its main headquarters in the United States,” says Bodla. He says it did not make sense to move the main ERP to China. The China-based operation also required dual language capability.

A second trend is to limit the amount of customization a customer has to make to an ERP system.

CYCLE TIME OF DELIVERY Customization TO STORES adds cost and the need for additional support. The more 50 PERCENT! customization, the greater the chance When Ulta Beauty needed to increase network for disintegration capacity to support projected store and within the ecommerce growth, they turned to Fortna. organization.

ERP providers address this issue Store-ready shipments enable faster shelf through upgrades, stocking in stores, freeing up associates partnering with to spend more time assisting guests. other providers Chief Supply Chain Officer, Ulta Beauty and acquiring ERP providers that bring functionalities for 100 GREAT SUPPLY specific types of CHAIN PROJECTS customers.

“The entire

d e v o r i m pby more than

“

40

”

Epicor’s Costing Workbench helps users maintain and view costing by part type and cost type, and access this information throughout the system.

A feature called Engineering Workbench allows Epicor users to build a visual view of a new bill of materials, accessing similar structures and revision levels.

game in our market is to deliver solutions that support most customers’ business processes out of the box, which reduces the demand on in-house IT staff for customization, integrations and overall software maintenance costs,” says Jean Huy, Sage’s vice president of global product marketing.

ERP providers are meeting this need by specializing to support industryspecific best practices as part of the core ERP workflow.

He says there are service partners that help customers complement their solution with add-on software that can be more effective than developing company-specific ERP customizations.

Such services customized on-premises ERP systems for years.

Companies such as Kern Inc. configure workflow systems in the cloud so customers don’t have to invest in software for applications specific to their own company. Kern cloud application services provide a subscription service that manages tasks that are not supported by ERP software.

Industry-specific ERP software

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is also emerging as a way to reduce customization. Vertical ERP is most prevalent in industries with regulatory requirements such as food. In manufacturing, verticals are prevalent in which the level of difference between standard industrial classification (SIC) codes is extensive, such as pharmaceuticals.

A SECOND TREND IS TO LIMIT THE AMOUNT OF CUSTOMIZATION A CUSTOMER HAS TO MAKE TO AN ERP SYSTEM.

REAL-TIME VISIBILITY ADDRESSES CHANGE UFP Technologies Inc., a producer of custom-engineered components, products and specialty packaging, changed ERP software four years ago to manage planning and manufacturing functions, says Keith Cote, plant manager and director of IT. The company uses Epicor ERP for quoting and estimating, order management, procurement, planning and front-end business functions.

In selecting a new ERP, UFP worked with a consultant who gathered specific requirements. They narrowed 12 candidates down to two, then gave the two candidates sample scenarios to address. The smoothness of the integration was a key consideration in UFP’s ultimate selection.

There were multiple plants to share information, view inventory and other information across the enterprise, and this information had to be consolidated at the corporate level, Cote says. UFP has to manage repeat business and new business simultaneously.

UFP used an on-premises version of Epicor ERP, although it is available in the cloud. The on-premises offering was the dominant offering at the time.

One of the biggest challenges customers face is learning about all the new ERP capabilities, says VAI’s Beasley. “ERP evolved quite a bit over the past many years,” he says.

Customers are tasked with breaking old habits to utilize new features that can help them.

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EXECUTIVE FOCUS

{ PROFESSIONAL DEVELOPMENT}

By Editorial Staff, Supply & Demand Chain Executive

Whether it’s a university or college you’re looking to poach fro

EDUCATION: A Step Up in

With the skilled labor shortage ubiquitous throughout the United States, supply chain teams need to be proactive about recruiting, training and education. Below is a listing of supply chain educators from which you can recruit, or improve current employees’ training and education.

BACHELOR’S DEGREES IN SUPPLY CHAIN

WWUNIVERSITY OF CENTRAL OKLAHOMA:

WWARIZONA STATE UNIVERSITY: Tempe,

WWMARQUETTE UNIVERSITY: Milwaukee,

WWUNIVERSITY OF HOUSTON: Houston, Texas;

WWASHFORD UNIVERSITY: San Diego, California;

WWMIAMI UNIVERSITY: Oxford, Ohio;

WWUNIVERSITY OF HOUSTON–DOWNTOWN:

WWASHLAND UNIVERSITY: Ashland, Ohio;

WWMICHIGAN STATE UNIVERSITY: East Lansing,

WWUNIVERSITY OF INDIANAPOLIS: Indianapolis,

WWAUBURN UNIVERSITY: Auburn, Alabama;

WWMISSOURI STATE UNIVERSITY: Springfield,

WWUNIVERSITY OF KANSAS: Lawrence, Kansas;

WWBELLEVUE UNIVERSITY: Bellevue, Nebraska;

WWNORTH CAROLINA A&T STATE UNIVERSITY:

WWUNIVERSITY OF MEMPHIS: Memphis,

Arizona; www.wpcarey.asu.edu www.ashford.edu/online www.ashland.edu www.auburn.edu

www.bellevue.edu/degrees WWBOISE STATE UNIVERSITY: Boise, Idaho; http://cobe.boisestate.edu WWCALIFORNIA STATE UNIVERSITY– LONG BEACH: Long Beach, California; http://web.csulb.edu/colleges/cba WWCLARKSON UNIVERSITY: Potsdam, New York; www.clarkson.edu WWCLAYTON STATE UNIVERSITY: Morrow, Georgia; http://business.clayton.edu WWCLEVELAND STATE UNIVERSITY: Cleveland, Ohio; http://csuohio.edu/business/osm WWDREXEL UNIVERSITY: Philadelphia, Pennsylvania; www.lebow.drexel.edu WWDUQUESNE UNIVERSITY: Pittsburgh, Pennsylvania; www.duq.edu/academics/ schools/business WWEASTERN MICHIGAN UNIVERSITY: Ypsilanti, Michigan; www.emich.edu/cob WWELMHURST COLLEGE: Elmhurst, Illinois; www.elmhurst.edu WWHOWARD UNIVERSITY: Washington, D.C.; www2.howard.edu WWINDIANA STATE UNIVERSITY: Terre Haute, Indiana; www.indstate.edu/business WWINDIANA UNIVERSITY–BLOOMINGTON: Bloomington, Indiana; www.iub.edu WWIOWA STATE UNIVERSITY: Ames, Iowa; www.business.iastate.edu WWLEHIGH UNIVERSITY: Bethlehem, Pennsylvania; www.lehigh.edu

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Wisconsin; www.marquette.edu/supplychain www.fsb.muohio.edu

Michigan; www.broad.msu.edu

Missouri; www.business.missouristate.edu

Greensboro, North Carolina; www.ncat.edu WWNORTHEASTERN STATE UNIVERSITY: Tahlequah, Oklahoma; www.cbt.nsuok.edu WWOLD DOMINION UNIVERSITY: Norfolk, Virginia; www.odu.edu/bpa WWPENNSYLVANIA STATE UNIVERSITY: University Park, Pennsylvania; www.smeal.psu.edu/sc WWRIDER UNIVERSITY: Lawrenceville, New Jersey; www.rider.edu/academics/collegesschools/college-business-administration WWSHIPPENSBURG UNIVERSITY: Shippensburg, Pennsylvania; www.ship.edu/business WWSOUTHEASTERN LOUISIANA UNIVERSITY: Hammond, Louisiana; www.southeastern.edu WWSTATE UNIVERSITY OF NEW YORK– PLATTSBURGH: Plattsburgh, New York; http://web.plattsburgh.edu/academics/gscm WWSYRACUSE UNIVERSITY: Syracuse, New York; www.whitman.syr.edu WWTEXAS A&M UNIVERSITY: College Station, Texas; http://mays.tamu.edu WWTUSKEGEE UNIVERSITY: Tuskegee, Alabama; www.tuskegee.edu/academics/colleges/cbis.aspx WWUNIVERSITY AT BUFFALO: Buffalo, New York; www.mgt.buffalo.edu WWUNIVERSITY OF AKRON: Akron, Ohio; www.uakron.edu/cba WWUNIVERSITY OF ALASKA–ANCHORAGE: Anchorage, Alaska; www.uaa.alaska.edu/cbpp WWUNIVERSITY OF ARKANSAS: Fayetteville, Arkansas; www.uark.edu

Edmond, Oklahoma; www.busn.uco.edu/isom www.bauer.uh.edu

Houston, Texas; www.uhd.edu Indiana; www.uindy.edu www.business.ku.edu

Tennessee; www.memphis.edu

WWUNIVERSITY OF MINNESOTA: Minneapolis, Minnesota; www.csom.umn.edu

WWUNIVERSITY OF NORTH CAROLINA–

GREENSBORO: Greensboro, North Carolina; http://bae.uncg.edu/isscm WWUNIVERSITY OF NORTH TEXAS: Denton, Texas; www.coba.unt.edu/mgmt WWUNIVERSITY OF OKLAHOMA: Norman, Oklahoma; http://price.ou.edu WWUNIVERSITY OF TENNESSEE: Knoxville, Tennessee; www.haslam.utk.edu WWUNIVERSITY OF TEXAS–AUSTIN: Austin, Texas; www.mccombs.utexas.edu WWUNIVERSITY OF TEXAS–EL PASO: El Paso, Texas; www.business.utep.edu WWUNIVERSITY OF TOLEDO: Toledo, Ohio; www.utoledo.edu/business WWUNIVERSITY OF WISCONSIN–MILWAUKEE: Milwaukee, Wisconsin; www.uwm.edu WWUNIVERSITY OF WISCONSIN–STOUT: Menomonie, Wisconsin; www.uwstout.edu WWUNIVERSITY OF WISCONSIN– WHITEWATER: Whitewater, Wisconsin; www.uww.edu/cobe WWWASHINGTON UNIVERSITY IN ST. LOUIS: St. Louis, Missouri; www.olin.wustl.edu WWWAYNE STATE UNIVERSITY: Detroit, Michigan; www.business.wayne.edu WWWESTERN WASHINGTON UNIVERSITY: Bellingham, Washington; www.cbe.wwu.edu/dsci/ WWWESTERN ILLINOIS UNIVERSITY: Macomb, Illinois; www.wiu.edu

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PROFESSIONAL DEVELOPMENT

ch from, or an advanced degree to boost your career, it’s all here.

p in Supply Chain MASTER’S DEGREES IN SUPPLY CHAIN WWAMERICAN GRADUATE UNIVERSITY: Covina,

WWGEORGIA INSTITUTE OF TECHNOLOGY:

California; www.agu.edu WWARIZONA STATE UNIVERSITY: Tempe, Arizona; www.wpcarey.asu.edu WWAUBURN UNIVERSITY: Auburn, Alabama; www.auburn.edu WWCALIFORNIA STATE UNIVERSITY–LONG BEACH: Long Beach, California; http://web.csulb.edu/colleges/cba/ WWCAPELLA UNIVERSITY: Minneapolis, Minnesota; www.capella.edu WWCASE WESTERN RESERVE UNIVERSITY: Cleveland, Ohio; www.weatherhead.case.edu WWCLARKSON UNIVERSITY: Potsdam, New York; www.clarkson.edu WWCLAYTON STATE UNIVERSITY: Morrow, Georgia; http://business.clayton.edu WWELMHURST COLLEGE: Elmhurst, Illinois; www.elmhurst.edu WWEMBRY-RIDDLE AERONAUTICAL UNIVERSITY: Daytona Beach, Florida; www.worldwide.erau.edu WWFLORIDA A&M UNIVERSITY: Tallahassee, Florida; www.famu.edu WWFONTBONNE UNIVERSITY: St. Louis, Missouri; www.fontbonne.edu WWGEORGIA COLLEGE: Milledgeville, Georgia; www.gcsu.edu

Atlanta, Georgia; www.gatech.edu WWINDIANA UNIVERSITY–BLOOMINGTON: Bloomington, Indiana; www.iub.edu WWLEHIGH UNIVERSITY: Bethlehem, Pennsylvania; www.lehigh.edu WWLOUISIANA STATE UNIVERSITY: Baton Rouge, Louisiana; www.bus.lsu.edu WWLOYOLA UNIVERSITY CHICAGO: Chicago, Illinois; www.luc.edu WWMICHIGAN STATE UNIVERSITY: East Lansing, Michigan; www.broad.msu.edu WWNORTH CAROLINA A&T STATE UNIVERSITY: Greensboro, North Carolina; www.ncat.edu WWNOVA SOUTHEASTERN UNIVERSITY: Fort Lauderdale, Florida; www.huizenga.nova.edu WWOLD DOMINION UNIVERSITY: Norfolk, Virginia; www.odu.edu/bpa WWPENNSYLVANIA STATE UNIVERSITY: University Park, Pennsylvania; www.smeal.psu.edu/sc WWPORTLAND STATE UNIVERSITY: Portland, Oregon; www.sba.pdx.edu WWSOUTHERN NEW HAMPSHIRE UNIVERSITY: Manchester, New Hampshire; www.snhu.edu WWSYRACUSE UNIVERSITY: Syracuse, New York; www.whitman.syr.edu

WWTEXAS CHRISTIAN UNIVERSITY: Fort Worth, Texas; www.neeley.tcu.edu

WWTOWSON UNIVERSITY: Towson, Maryland; www.towson.edu

WWUNIVERSITY AT BUFFALO: Buffalo, New York; www.mgt.buffalo.edu

WWUNIVERSITY OF ALASKA–ANCHORAGE:

Anchorage, Alaska; www.uaa.alaska.edu/cbpp

WWUNIVERSITY OF MARYLAND–COLLEGE

PARK: College Park, Maryland; www.rhsmith.umd.edu WWUNIVERSITY OF MICHIGAN: Ann Arbor, Michigan; www.michiganross.umich.edu WWUNIVERSITY OF SAN DIEGO: San Diego, California; www.sandiego.edu/scmi WWUNIVERSITY OF TEXAS–DALLAS: Richardson, Texas; http://som.utdallas.edu WWUNIVERSITY OF WISCONSIN–PLATTEVILLE: Platteville, Wisconsin; www.uwplatt.edu WWUNIVERSITY OF WISCONSIN–STOUT: Menomonie, Wisconsin; www.uwstout.edu WWUNIVERSITY OF WISCONSIN– WHITEWATER: Whitewater, Wisconsin; www.uww.edu/cobe WWWASHINGTON UNIVERSITY IN ST. LOUIS: St. Louis, Missouri; www.olin.wustl.edu WWWRIGHT STATE UNIVERSITY: Dayton, Ohio; www.wright.edu/business

ADVERTISER INDEX ADVERTISER.......PAGE NUMBER Association for Operations Management (APICS)........45 www.apics.org CenterPoint Properties....... 7 www.centerpoint.com Demand Management Inc.........................................29 www.demandsolutions.com

Fortna Inc............................40 www.fortna.com Global4PL Supply Chain Services....................15 www.global-4pl.com KPMG LLP............................39 www.kpmg.com LeanLogistics Inc...............41 www.leanlogistics.com

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Numerex Corp....................31 www.numerex.com Old Dominion Freight Line Inc..................... 9, 11, 13 www.odfl.com Omnitracs..................... 18, 19 www.omnitracs.com Quintiq................................... 2 www.quintiq.com

Saddle Creek Logistics Services...............23 www.sclogistics.com SAP Ariba................. 5, 16, 17 www.ariba.com

SDCExec.com | June 2016 | SUPPLY & DEMAND CHAIN EXECUTIVE

43

6/20/16 9:28 AM

WORK HARD,

By Ronnie Garrett

HORSES AND HAY D

uring her tenure as a high-ranking communications executive at global companies that included Nestle, BristolMyers Squibb and Revlon Inc., MarieClaude Stockl was no stranger to stress.

This self-described “horse-crazy girl” says she found her stress relief amidst the smell of horses and hay.

Eventually, she and husband Larry Stockl, a former American Express executive, relocated from Manhattan to a country home in Hudson, New York, where for the next 10 years, she juggled demanding work as a coaching consultant for clients, such as Procter & Gamble and Merck, with country life.

But in 2005, she jumped out of the corporate world and landed at the barn full time. Marie-Claude combined her work with corporations and her love of horses to found The Horse Institute, and offer training for corporate execs and their teams to build coping skills in the workplace.

44

Supply chain execs trot toward better leadership skills at The Horse Institute.

“I see the stresses go up and up [in the corporate world] every decade,” she says. “Today, it’s 24/7. You always have to be connected. But, I never see someone pull out a smartphone when they are working with horses.”

In a world where constant deadlines, financial concerns, risk management and increased customer demands are a way of life, it’s imperative for supply chain executives to find positive outlets for stress. Here, guided interaction with horses can help them develop their emotional intelligence quotients, which can better equip them to handle stress on the job. “Equine-assisted learning can be a major force for positive change in the workplace,” says Marie-Claude.

At The Horse Institute, participants are asked to do six 20-minute activities during their day at the barn. They debrief after each one and discuss how to apply what they learned on the job.

One activity asks participants to round up a team of horses representing their “new hires.” Teams of two are asked to greet the horses, put a halter on one of them and lead the horse back to “headquarters. “Every time we do this, corporate execs take it as a competition,” she says. “But this isn’t a competition, it’s about communication.”

She says the exercise typically “leads

Teams learn to communicate and work together to solve problems involving their equine employees.

to a conversation about breaking down siloes and working as a team,” in today’s fragmented corporate world.

Participants also learn to value honest interactions. “Horses know when participants say one thing, but their body language screams another, and they will walk away,” she says. “These exercises help leaders think about how they communicate—verbally and nonverbally.”

The day wraps up with each participant writing action plans based on what they discovered about themselves. And, for some, the day leads to a new lifestyle amidst the smell of horses and hay. Marie-Claude recalls how one executive was initially afraid of the institute’s four-legged teachers. “By the end of the day, she was the person the horses took to the most. Today, she owns a horse of her own.”

SUPPLY & DEMAND CHAIN EXECUTIVE | June 2016 | SDCExec.com

SDC0616_44-46_WorkHard RG CM.indd 44

6/17/16 11:28 AM

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