Supply & Demand Chain Executive September 2020

Global Supply Chain Solutions Covering Procurement, Risk, the IoT and More

SEPTEMBER 2020

MANAGER VS. LEADER

INDUSTRIAL REVOLUTION 4.0

6 signs you need to make a change

Creating a smarter supply chain with innovation and technology

BLOCKCHAIN IN PHARMA

How standards can improve supply chain safety

2020 SPECIAL ANNIVERSARY COVERAGE

INSIDE

Bindiya Vakil, CEO and founder of Resilinc, is crowned SDCE’s first ever Supply Chain Woman of the Year.

Fresh new content daily at www.SDCEXEC.COM

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PROS TO KNOW 2020CHAIN 2020 WOMEN IN SUPPLY

2020

omen

MEGAN SMITH CEO Symbia Logistics

i SUPPL in SUPPLY LY CHAIN

HANNAH KAIN ADA PALMADOTTIR

President and CEO ALOM

HEATHER MUELLER Chief Operating Officer Breakthrough

PAULA PETERSEN

Business Development Director Controlant

BERNADETTE “BERNIE” VALENCIA

VP Procurement PRIDE Industries

JANET BAYS

Senior IT ManagerApplications and Development Toyota Tsusho Americas, Inc.

VP & General Manager, Guam & Micronesia Matson Navigation Company

JILL HOCHSTETLER Senior Manager, Logistics Operations Jarrett Logistics Systems

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Chief Information Officer DHL Supply Chain, North America

VALERIE HOGE

CHARLENE KELLER Senior Director of Enterprise Accounts Choptank Transport

SALLY MILLER

LYNN CALDWELL Chief Sales Officer Banyan Technology

MARY LAMIE

Executive VP – Multi Modal Enterprises Bi-State Development

Chief Operations Officer DHL Supply Chain North America

9/23/2020 10:58:55 AM

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September 2020 | Volume 21 | Issue 3

CONTENTS 26

FEATURES

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COVER STORY The Fourth Industrial Revolution is the Smart Revolution Here’s how IoT creates smarter supply chains.

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EXECUTIVE FOCUS

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EMERGING TECHNOLOGY Pharma Industry Explores How Blockhain and Standards Can Improve Supply Chain Safety

TRANSPORTATION Supply Chain Automation Innovation Inside the Warehouse and on the Road

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GS1 details how blockchain in a pharma supply chain makes for faster delivery of safe medications.

WAREHOUSING Perfecting the Balancing Act of Inventory Management Area Technology says out-of-balance inventory could now be catastrophic, if not fatal.

SOFTWARE & TECH Supply Chain Cybersecurity— Go Deep, Verify and Avoid the Compliance Trap Exostar details how organizations with sophisticated cybersecurity measures can still be compromised.

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Evaluating and piloting emerging technologies helps streamline applications, says DHL Supply Chain.

SPECIAL REPORTS

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Medius outlines how source-to-pay technology brings new suppliers onboard quickly.

AWARD Women in Supply Chain

This award honors female supply chain leaders and executives whose accomplishments, mentorship and examples set a foundation for women in all levels of a company’s supply chain network.

PROCUREMENT How Next-Gen Source-to-Pay Capabilities Help Organizations Navigate “New Normal”

PROFESSIONAL DEVELOPMENT Are You a Manager or a Leader? 6 Signs You Need to Make a Change Many leaders are still managers who have not yet made the transition to their leadership role, according to a corporate leadership advisor.

COLUMNS 04 06 36

EXECUTIVE MEMO CHAIN REACTIONS MADE IN AMERICA

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*SPECIAL 20YEAR ANNIVERSARY COVERAGE SDCE Celebrates its 20-year Anniversary Here’s a rundown of how we’re celebrating.

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SDCEXEC.COM

Exclusive online features and solutions for successful supply chain operations

Supply & Demand Chain Executive Celebrates 20-Year Anniversary

Learn. Innovate. News.

Knowledge. The L.I.N.K. to Global Supply Chain Intelligence

Supply & Demand Chain Executive Launches Supply Chain Network Virtual Summit

www.sdcexec.com/20-year-anniversary

www.sdcexec.com/podcast

https://www.sdcexec.com/scn-summit

www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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EXECUTIVE MEMO

By Marina Mayer Editor-in-Chief mmayer@ACBusinessMedia.com

Published by AC Business Media 201 N. Main Street, 5th Floor, Fort Atkinson, WI 53538 (800) 538-5544 • www.ACBusinessMedia.com

They’ve overcome obstacles, moved mountains and closed the door on nonbelievers.

They continue to make a difference in the supply chain industry, even amid the Coronavirus disease (COVID-19).

And, I couldn’t be prouder to be a part of this journey with them.

Congratulations to our overall winner, Bindiya Vakil, founder and CEO of Resilinc. (Go to page 16). Vakil looks great on paper, but I had the pleasure of talking with her via our L.I.N.K. Live Facebook Livestream, and she’s even more fascinating “in person.”

Because we now work, live and function in an almost completely digital world, it’s more important than ever that we—women—continue to support each other, embrace each other and lift each other up. Leave the shaming at the door.

Let’s mentor, collaborate, teach, learn and grow together. Let’s cut each other some slack.

And, thank you to the men who nominated the female leaders in their workplace and who continue to support women in general, all while holding the door for us (both literally and figuratively).

So, women, let’s straighten each other’s tiaras and share the seat at the table.

I look forward to seeing what the future holds for the women graced on pages 18-23, in addition to the future female leaders in the making.

Please Let Me Straighten Your

TIARA W

elcome to Supply & Demand Chain Executive’s 20-Year Anniversary issue.

And, let me tell you, this one is special.

That’s because SDCE introduced the new Women in Supply Chain award, honoring female supply chain leaders and executives whose accomplishments set a foundation for women in all levels of a company’s supply chain network.

Here’s what I really loved about this award. We received over 300 nominations. Of those 300, 136 were crowned winners, and of those 136, 26 nominations came from men. That’s a little over 5% of the winners being recognized by their male counterparts.

This is huge.

I’ve been in the B2B publishing world for close to 14 years; in the supply chain and logistics space for eight of those years. I’ve witnessed the industry evolve from me being the only “girl” in the room to now applauding my female industry peers as they get promoted and move up the ranks.

These women are doing it all— they’re innovating, developing, building, learning, educating and mentoring.

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www.SDCExec.com PRINT AND DIGITAL STAFF GROUP PUBLISHER Jason DeSarle SALES ASSOCIATE Brian Hines EDITORINCHIEF Marina Mayer ASSOCIATE EDITOR Brielle Jaekel ASSISTANT EDITOR Mackenna Moralez SENIOR PRODUCTION MANAGER Cindy Rusch ART DIRECTOR Willard Kill AUDIENCE DEVELOPMENT MANAGER Angela Franks ADVERTISING SALES (800) 538-5544 JASON DeSARLE jdesarle@ACBusinessMedia.com BRIAN HINES bhines@ACBusinessMedia.com MELANIE GARCIA mgarcia@ACBusinessMedia.com CIRCULATION & SUBSCRIPTIONS P.O. Box 3605, Northbrook, IL 60065-3605 (877) 201-3915, Fax: (847) 291-4816 Email: circ.sdcexec@omeda.com LIST RENTAL Bart Piccirillo, Sr. Account Manager Infogroup Media Solutions (soon to be Data Axle) Phone: (518) 339 4511, E-mail: bart.piccirillo@infogroup.com REPRINT SERVICES BRIAN HINES, (647)296-5014 bhines@ACBusinessMedia.com AC BUSINESS MEDIA CHIEF EXECUTIVE OFFICER Barry Lovette CHIEF FINANCIAL OFFICER JoAnn Breuchel CHIEF DIGITAL OFFICER Kris Heineman CHIEF REVENUE OFFICER Amy Schwandt VP AUDIENCE DEVELOPMENT Ronda Hughes DIRECTOR OF DIGITAL OPERATIONS & IT Nick Raether DIRECTOR OF DIGITAL STRATEGY Joel Franke GROUP CONTENT DIRECTOR Jon Minnick Published and copyrighted 2020 by AC Business Media All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage or retrieval system, without written permission from the publisher.

Supply & Demand Chain Executive [USPS #024-012 and ISSN 1548-3142 (print) and ISSN 1948-5654 (online)] is published four times a year: April, June, September and December by AC Business Media, 201 N. Main Street, 5th Floor, Fort Atkinson, WI 53538. POSTMASTER: Please send all changes of address to Supply & Demand Chain Executive, P.O. Box 3605, Northbrook, IL 60065-3605. Printed in the USA. SUBSCRIPTION POLICY: Individual subscriptions are available without charge in the United States, Canada and Mexico to qualified individuals. Publisher reserves right to reject nonqualified subscribers. One-year subscription to nonqualified individuals: U.S., $30; Canada and Mexico, $50; and $75 for all other countries (payable in U.S. funds, drawn from U.S. bank). Single copies available (prepaid only) for $10 each.

The information presented in this edition of Supply & Demand Chain Executive is believed to be accurate. The publisher cannot assume responsibility for the validity of claims or performances of items appearing in editorial presentations or advertisements in the publication.

September 2020 / Volume 21 / Issue 3

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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CHAIN REACTIONS

NEWS FROM ACROSS THE DIGITAL SUPPLY CHAIN

SIEMENS AND SAP JOIN FORCES

TO ACCELERATE INDUSTRIAL TRANSFORMATION

AT 18.2% CAGR THROUGH 2027 According to Market Study Report Worldwide, the delivery robot market size accounted for $14.18 billion in 2019 and is expected to reach $54.30 billion by 2027, reaching a growth rate of 18.2% between 2020-2027. The growth is primarily attributed to easy availability of affordable delivery robots and improved return on investment.

Shifting preference for flexible delivery systems and rising loading capacity of these robots are stimulating the industry outlook. Furthermore, focus toward improving last-mile delivery in tandem with development of advanced delivery robots favor the market outlook. In November 2019, for instance, MIT introduced a last-mile delivery robot equipped with advanced navigation technology.

Additionally, inclination toward online shopping have resulted in rapid expansion of the e-commerce sector, which in turn, fosters the demand for effective delivery systems across the globe. However, strict regulatory scenario regarding the adoption of delivery robots may act as a restraining factor to the market expansion.

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Siemens and SAP SE announced a new partnership that will leverage their industry expertise and bring together their complementary software solutions to offer the first truly integrated and enhanced solutions for product lifecycle management (PLM), supply chain, service and asset management.

This will enable customers to form a true digital thread integrating all virtual models and simulations of a product or asset with real-time business information, feedback and performance data over the entire lifecycle.

“Digital transformation will be critical for the manufacturing industries to increase productivity, flexibility and accelerate innovation, so companies must come together in new ways to enable the digital enterprise,” says Klaus Helmrich, member of the managing board of Siemens AG and CEO of Siemens Digital Industries. “This exciting collaboration between two industry leaders is about more than just interoperability and interfaces; it is about creating a truly integrated digital thread that unites product and asset lifecycle management with the business that enables customers to optimize production of products.”

This new partnership will help customers break down these siloes, so manufacturers, product design teams and service managers have the information needed to quickly create and manage customer-centric product and service offerings.

GLOBAL DELIVERY ROBOT MARKET TO EXPAND

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GARTNER IDENTIFIES TOP SUPPLY CHAIN TECHNOLOGY TRENDS IN 2020 Gartner Inc. has identified the Top 8 supply chain technology trends in 2020.

These strategic supply chain technology trends have a high potential for positive impact on people, performance and industries. Some are now reaching critical tipping points in capability and maturity.

“The vast majority of organizations have a cautious approach to adopting supply chain applications and technologies,” says Christian Titze, vice president analyst with the Gartner Supply Chain Practice. “Only 21% are willing to consider, and often adopt, early-stage technologies. However, even cautious supply chain leaders must keep an open mind and embrace long-term perpetual change.”

The top supply chain technology trends in 2020 are: • Edge computing and analytics • Hyper-automation • Artificial intelligence • Digital supply chain twins • 5G networks • Continuous intelligence • Immersive experience • Supply chain governance and security

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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SPECIAL ANNIVERSARY COVERAGE

By Marina Mayer

SDCE CELEBRATES

YEAR

ANNIVERSARY!

Supply & Demand Chain Executive celebrates 20 years of quality content with a special anniversary issue.

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moving forward, working with and alongside industry associations, suppliers and manufacturers to share news, updates and expertise on how to navigate and sustain during a pandemic.

We talked blockchain, sustainability, professional development, supply chain security and more. We watched the industry band together to deliver personal protective equipment (PPE), medical supplies and software solutions in newly created channels. I witnessed my own team, including myself, step up to deliver content in innovative ways (think LINK Live, podcasts and more).

Here’s a rundown of some digital Check out the SDCE editors every Wednesday at 11 a.m. CST, components designed to celebrate SDCE’s as they stream live on Facebook to discuss hot-button topics 20 years of quality content and honor the hen the Supply & Demand Chain Executive (SDCE) team started putting together this 20-year Anniversary issue, it was during what can only be dubbed now as the “Old Normal.” Editorial and sales staff sat in a conference room to hash out ideas. Plans included in-person tradeshows and conferences. Even the Supply Chain Network (SCN) Summit was to be a 3-day in-person event.

Fast forward six months later, and this “New Normal” has presented challenges and opportunities never imagined in such a short timeframe.

The Coronavirus disease (COVID-19) pandemic upended the entire supply chain and logistics industry, yet the staff of SDCE continued

impacting the supply chain and logistics industry.

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people, plants and processes that continue to move the supply chain industry forward.

Pros to Know “Where Are They Now?” Here, we revisit previous Pros to Know winners to learn what they’ve been up to since last receiving this award, as well as discuss how the industry has changed, what they’ve learned and advice for incoming supply chain professionals.

E-Commerce’s Impact on the Supply Chain.

Discuss the impact e-commerce has had on the supply chain in the last 20 years in e-commerce/ retail, pharmaceutical, automotive and more.

The Next 20 Years in Supply Chain. Check out this forecast of the future with regards to “phygital” landscape trends, retail brick-and-mortar vs. online and back again. Find out what some of the top IoT, robotics and big data companies are doing to automate for the future.

And, find market research stats and studies that outline where the industry is headed over the next 20 years.

This Day in History.

From the first package shipment to the industry’s first software solution, follow this guideline through time.

L.I.N.K. Educate podcast series. SDCE editors interviewed students, professors and veterans of the supply chain industry to discuss how the supply chain industry has changed in terms of recruiting, training and more.

New Women in Supply Chain award.

This new award honors female supply chain leaders and executives whose accomplishments,

L.I.N.K. Educate consists of interviews with students, professors and veterans of the supply chain industry discussing education, recruiting, training and more.

mentorship and examples set a foundation for women in all levels of a company’s supply chain network. Go to page 16 to check out the winners.

L.I.N.K. Live. SDCE editors stream live on Facebook every Wednesday at 11 a.m. CST with guest experts to discuss hot-button topics impacting the supply chain and logistics industry.

Who knows what the next 20 years will look like. How will the technology look? How will supply chains operate? And, what does all of this mean for the future of our supply chain leaders?

Pandemic or not, this industry is prepared to navigate and overcome any obstacle. And, the SDCE team is ready and able to ride the ride with and alongside industry associations, suppliers and manufacturers.

Go to https://www.sdcexec.com/20-yearanniversary to check it all out.

Congratulations SDCE.

www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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COVER STORY

By Brielle Jaekel

THE FOURTH

to advances in automation and robotics, and while that technology is evolving significantly, the bigger hardware trends are in data capture and analytics,” says Nick Anderson, principal in Kearney’s strategic operations and supply chain management group. “There has been an explosion of Internet of Things technologies and sensors that can capture and process data from customers, suppliers, products, equipment and personnel.

Companies recognize that there is tremendous value in visualizing and analyzing that data and turning it into actionable insights that will enhance the customer experience and boost internal performance.”

This extensive connectivity is changing the warehouse floor as we know it.

“Hardware innovation is transforming the shop floor in the Fourth Industrial Revolution,” says Russell Rasmus, managing director of supply chain and operations, Accenture Strategy.

“Hardware designed for 5G/IoT and connected

INDUSTRIAL REVOLUTION

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a l s T l m d r s c t

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Kearney

he First Industrial Revolution took shape toward the end of the 18th century. Automation began to grow, and goods started to be produced in mass quantities for the first time. From there, the complex, global and digitized retail industry started to evolve. Industrial revolutions such as steam, science and computerization followed and further shaped trade into the global and modern system it is today.

Currently, the industry is on the precipice of what is now called the Fourth Industrial Revolution. A greater form of automation builds, and artificial intelligence (AI) enhances capabilities in the supply chain. Software now touches nearly everything in the manufacturing, warehousing and logistics processes, all the way out to consumer purchasing.

While software controls so much of the supply chain, it would not be possible without the assets it enables. Hardware is the body to the software’s brain, and the Fourth Industrial Revolution has a more technologically advanced classification of equipment in the warehouse and logistics. The key phrase here is the Internet of Things (IoT), as hardware in the supply chain becomes “smart” and real autonomy comes along.

“Many people think the Fourth Industrial Revolution, or Industry 4.0, refers specifically

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everything is enabling greater overall equipment efficiency and productivity. Digital twin and digital thread is enabling production process simulation and testing, further reducing lead times for new products.”

Robotics and drones now join the warehouse and logistics process, turning the actual physical landscape of the supply chain into a futuristic setting imagined previously in science fiction.

This year, the floor of MODEX 2020 looked just like one of those sci-fi novels, where machine and man work hand in hand. Technology companies displayed their latest and greatest warehouse robotics systems, changing the repetitive hardware systems into intelligent and flexible equipment capable of completing tasks almost completely by themselves.

“Robots and drones are becoming a reality with many new applications for pick and pack and delivery,” says Joe Phelan, chief strategy officer at P3. “These solutions are reducing the costs of operations and improving reliability by reducing human error of handling. Data storage along with more efficient use of information in the future via the use of Microsoft’s Power BI will open the way for more real-time information and logistics solutions by ensuring assets and resources are fully utilized and available when needed.”

Some examples of these innovations includes Romark Logistics’ recent integration of drones for automated scans of pallet barcodes at its distribution center, and Coty Cosmetics’ use of Universal Robots and mobile carts for pick and pack at its Maryland factory.

TRANSFORMING THE WAREHOUSE Pick and pack processes, like the Coty Cosmetics example, are more advanced today and will continue to rapidly evolve as more technology enters the floor, much like other processes in the supply chain. Connective hardware, sensors and autonomous equipment push efficiency and increase productiveness. Today, smart shelf technologies are rampant in the warehouse, in addition to these pick-and-pack solutions and automated storage. All of this is integrated with RFID sensors to track real-time inventory data.

The more IoT integrates onto the floor, the more accurate and streamlined the packing

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process becomes, putting pressure on those who do not have these processes in place, as they will fall behind.

In 2018, APQC released a study that showed top performers can ship customer orders 31 hours faster than bottom performers, giving them a competitive advantage that ultimately makes it easier to keep their customers happy, retain existing customers and potentially acquire new ones. In the two years since then, automation has only increased, and since the Coronavirus disease (COVID-19), warehouses eye these processes even more.

“Warehousing hardware is focused on automation and accuracy of order fulfillment,” Rasmus says. “Hence, hardware is designed for speed and mistake-proofing, picking and staging for delivery. AGVs, minibots, vision analytics, automated material handling [are] getting more digital and connected to each other to deliver speed and accuracy.”

Connectivity in the transportation process came on the scene quicker than in the warehouse because of the use of satellite and GPS tracking.

However, indoor tracking grows and can now provide a precise view of the warehouse and where products are thanks to sensors such as RFID. “Warehousing often requires ‘indoor’ connectivity with triangulation positioning, whereas logistics often require ‘outdoor’ longrange connectivity with GPS positioning,” says Angela Kerr, vice president of product management for SpotSee. “However, the low-end hardware solutions for both warehousing and logistics are converging into battery-less, RFIDenabled sensors driven by the more than 50% annual growth of RFID readers.”

The supply chain process from the warehouse all the way through the logistics and transportation process should be enabled with connectivity, as customers expect a modern relationship with partners, which includes excessive transparency and efficiency. For the warehouse, this means racks, material handling systems, robotics and other handling equipment such as forklifts that are both autonomous and non-autonomous, according to Phelan.

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COVER STORY

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SpotSee

UPGRADING THE FLEET For the logistics process, the Industry 4.0 means a more technologically advanced fleet. This includes driverless delivery vehicles, which may be far away from becoming commonplace, but are absolutely a reality. Geo-location sensor technology is a trend seen throughout fleets today, which helps provide that significant level of transparency and visibility partners are looking for. Customers want to know exactly where their shipments are in real-time.

In addition to this visibility, technology integration into fleets can help with route optimization, assisting drivers in finding the most efficient path, says Anderson.

These aspects and customer demands are important when it comes to hardware, as logistics companies make investments into equipment that have this high level of connectivity. The more equipment can interact with software, the more insights it can provide if accurately integrated with AI. Connected hardware in the logistics process is a significant avenue for customer quality assurance.

If a problem occurs during a shipment, not only can a partner be notified quicker, but it is also simple to track how it occurred.

In addition to dealing with problems, the growth of IoT in logistics significantly helps in the reverse logistics industry, which has experienced in uptick thanks to the increase in e-commerce.

“Logistics, which includes warehousing, will include the customer interface, transportation and delivery solutions, reports and business intelligence and solutions for handling returns otherwise known as reverse logistics,” says Phelan.

“These solutions are mostly aided by the Internet of Things and various hardware solutions.

The common thread for the hardware of both warehouses and the rest of the logistics system is information. Integrating information and making it available real time with full visibility of the most important KPIs and up-to-the-minute reporting and information needed to aid in the decisionmaking process will reduce your costs, improve your quality and improve your overall customer service.”

RFID sensors are a huge part of the supply industry’s move toward the Industry 4.0.

COVID19’S IMPACT The supply chain has slowly adopted these technologies, making the gradual evolution toward the Fourth Industrial Revolution. But, in March, this evolution was upended—more accurately, fast tracked—when COVID-19 hit the United States and stretched the supply chain extremely thin.

Despite a global pandemic, essential goods still needed to be moved. While many companies suffered setbacks, having to immediately move most of their workforce remotely and limiting physical interaction within the warehouses and throughout logistics processes, those with automated and digitized processes in place experienced fewer challenges. The expectation is that many companies in the supply chain will investigate low-touch digitization in the near future and those who already planned to integrate these processes fast tracked them.

“Most Industry 4.0 technologies are ‘low-touch’ by design, and thus are a great fit for a company’s COVID-19 response,” Anderson says. “One category that has gained traction immediately are wearable devices. Wearable geofencing solutions are being implemented to alert employees if they are getting too close to one another, and also track employee movement as a form of contact tracing if an outbreak does occur. Also, wearable augmented reality and video display glasses are being introduced to enable remote maintenance

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and remote site visits, so outsiders do not need to travel to a facility and risk contamination.”

“I would say there is an increased need for resilience, flexibility, agility in the warehouse operations and proactive deflection of risk due to COVID,” adds Alberto Oca, partner, strategic operations transformations at Kearny. “This has led to shippers accelerating allocation of capital specially for deployment of robotics (e.g., AGVs, AMRs, etc.), augmented reality devices (e.g., smart glasses) and bionic enhancements.”

In addition to physical and social distancing, the COVID-19 pandemic also shined a light on the need for manufacturers and companies in the supply chain to be flexible and resilient. This is another area that technologically advanced hardware helps.

“The pandemic continues to fuel innovation across every sector,” Rasmus adds. “CV-19 forced many organizations [to] realize early on the need to be flexible and adapt quickly to crises.

Companies have learned that this rapid response requires flexible and energy efficient hardware to quickly change priorities and fully meet crisis demands, speeding up many organizations’ adoption of digital transformation plans.

“For example, manufacturing assembly lines producing cars changed overnight to producing ventilators. The pandemic has made every company become a health company,” he says.

“This has resulted into demand of flexible manufacturing processes and tools that can help companies change their entire product portfolio to cater to new customer needs. Flexible production lines that can be programmed and tested using digital twin and digital thread are being designed to make the shop floor more agile and flexible.”

Unfortunately, the pandemic continues to rage on, driving the supply chain to adopt new ways of operating during a “New Normal” instead of the temporary time period that many believed would be over within a month or two. As customers continue to try and keep their distance, reducing the number of trips made to brick-and-mortar locations, the need for shipped packages continues to remain in high demand. In addition to the increase of essentials or variety of everyday

product shipments, numerous new products such as testing kits, temperature-monitoring devices, personal protective equipment, sanitization systems and more are constantly being moved in the supply chain.

As the need for these products to be moved continues, so too does the need to social distance as well as the need for extreme efficiency, pushing a greater demand for connectivity, says Kerr.

Likewise, this becomes the New Normal, as greater demand for hardware that can support this connectivity grows.

“Using devices for temperature checks, monitoring movements within an office complex, using all the traditional common use devices without the touch at airports, airlines, hotels, shipping facilities, retail outlets, gas stations—you name it—will increase the demand for supporting hardware, and the overall functionality will enhance as a result of ongoing technological improvements,” Phelan says. “All of these increased uses for hardware will result in quality of life improvement only if aided with having the right information, at the right place, at the right time. ”

DOWNSIDE OF INNOVATION As Industry 4.0 makes a positive impact on the supply chain and the way we do business, it is not without its growing pains, which have only been exacerbated by COVID-19.

“Companies must continually adapt to global supply chain challenges that have only been magnified by the COVID-19 Warehouses today offer significantly more visibility pandemic,” Rasmus through IoT. says. “Those companies that prioritize agile, resilient supply chains will be well-positioned to adapt to these changes in real-time. A recent Accenture survey of 900 companies across the globe showed that only 10% of those surveyed are transforming their supply chains in a way Kearney

y

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COVER STORY not have the internal knowledge or capability to that contributes to customer-centric, purpose-led effectively procure, install, operate and maintain growth. Organizations that aren’t prioritizing the this technology.” customer in their decisions will not see maximum Additionally, Kerr details the costs associated return on investment. A separate but related with implementing these new technologies.

Accenture survey found that 64% of companies While many companies may tend to look at lower were not seeing a boost to revenues from digital cost IoT systems, this may come with its own set investments. As companies continue to invest in of problems. digital technologies across the supply chain, it’s “Low-cost connectivity in the supply chain essential that these investments are maximized is difficult to maintain and may often require across the organization—cross-department more than one technology,” she says. “The collaboration will increase efficiency and deliver environmental robustness of low-cost batteries results on investments made. used in powered devices does not fully meet “Multiple external factors, the demands of the global supply including geo-political situations, natural chain. However, this can be partially solved by using calamities and regulations battery-less RFID and [are] driving sensor technologies.”

“Simplifying complexity in big data by using global supply tools like Power chains,” he BI is useful for says. “Trusted spotting trends supplier in the business networks and proving need to be real-time drillchanged overnight down capabilities for more robust due to these factors with ever analytics,” Phelan The latest industrial revolution growing scarcity of says. “However, the is enabled with smart hardware. resources, talent and organization must be equipped with capable process skills. Intelligent supply Pok Rie from Pexels improvement engineers that can chains also require a different understand the inter-dependencies of all talent pool that is scarce and high in the moving parts in a supply chain or business demand.” process and have a continuous improvement As these new technologies enter the field, many mentality.” companies experience what is known as “shiny COVID-19’s influence on accelerating the object syndrome” and gravitate toward new and Fourth Industrial Revolution will likely be long trending technologies without evaluating if it lasting and hardware will grow its capabilities far will actually benefit their operation or how it will beyond the conveyor systems of the recent past. integrate into their processes.

New processes will fall into place and “We have seen two main challenges companies companies will determine how technology face on their Industry 4.0 journey,” Anderson says. can best fit into their operations for a more “The first is that often technologies are not fit streamlined system. for purpose; companies implement new devices If done right, this next generation of industrial without considering the business problems equipment could dramatically impact the supply they are trying to solve. The second challenge chain for good for years to come. is regarding the skills gap; many companies do 14

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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THE ENVIRONMENT WILL THANK YOU. SO WILL YOUR ACCOUNTANT. People are having more goods delivered, faster, than ever before. Which means your fleet is generating more emissions than ever before. What if you could cut your fleet’s carbon footprint to zero and save money doing it?

www.CleanEnergyFuels.com

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AWARD

By Mackenna Moralez

SUGAR, SPICE AND EVERYTHING NICE 

SHOW THE INDUSTRY WHAT THEY ARE MADE OF

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Supply & Demand Chain Executive introduces the recipients of its first annual Women in Supply Chain award.

hat does it really mean to act “like a lady?” Does it really mean to be feminine and sit back quietly while others take the lead? Women across various industries have been working their femininity by being innovators and thought leaders, and that is no different in the supply chain.

According to Gartner Inc.’s 2020 Women in Supply Chain Survey among 177 supply chain professionals, 17% of chief supply chain officers (CSCOs) are now women—a 6% increase compared to 2019 and the highest rate since the first edition of the survey in 2016.

“The increase in women executive leaders over the past year is a positive sign, however the survey showed that women don’t consistently make it through the pipeline,” says Dana Stiffler, vice president analyst, Gartner Supply Chain Practice. “Lack of progress is not something the industry can afford at the moment. Supply chain’s role in the COVID-19 pandemic and subsequent recovery is crucial, with lives and livelihoods at stake. This is a pivotal time for many women in mid-level and senior management positions.”

Despite the increase, there is still a noticeable gap between women and men in vice president and director levels.

According to the survey, 63% of respondents have active goals, objectives or initiatives to recruit more women to their business and build pipelines.

However, it could take years to build this activity to strengthen pipelines. This contributes to representation of women in the total supply chain workforce remaining 16

unchanged at 39% year-over-year.

The Wall Street Journal found that men earned 29% more than women in 2017, with the gap widening in C-suite positions. Although there are fewer women working within the field, men who had 15-19 years of experience in the industry earned 48% more than their female counterparts.

Nevertheless, women continue to move the industry forward. That’s part of the reason why Supply & Demand Chain Executive launched its first annual Women in Supply Chain award.

The Women in Supply Chain award honors female supply chain leaders and executives whose accomplishments, mentorship and examples set a foundation for women in all levels of a company’s supply chain network.

SDCE received over 300 nominations, with 136 women gaining recognition. In addition, 5% of winners were nominated by their male counterparts, while 8% of winners were self-nominated. This milestone award has reached women in every single sector of the supply chain, recognizing their outstanding talents and perseverance.

So, what does it really mean to act “like a lady?” The recipients of this award will be able to tell you. It’s about leading with grace, advocating for your team, being a mentor, having a willingness to learn and adapt to changes and more. Because if you fight like a girl, feel like a girl and lead like a girl, then maybe the supply chain field is for you.

Please join SDCE in introducing the first recipients of the Women in Supply Chain Award.

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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BINDIYA VAKIL

NAMED SDCE’S FIRST SUPPLY CHAIN

WOMAN

OF THE YEAR

“

Women can be self-deprecating at times,” says Bindiya Vakil, CEO and founder of Resilinc. “We should believe in ourselves a little more. I know, it’s very hard to do. We are our own worst critic, and we need to be more confident.”

And, if Vakil is anything, she is confident.

Her achievements in the supply chain have crowned her Supply & Demand Chain Executive’s first annual Supply Chain Woman of the Year.

“I’m very humbled and grateful to be selected.

I’m an immigrant and a first-time entrepreneur in this country doing something crazy like starting my own company,” says Vakil. “It’s an amazing recognition for me and for Resilinc, for the work that my team has done to help me get this recognition.”

In her 20-year career, Vakil has helped transform the way that global organizations approach supply chain visibility and risk, serving in numerous sourcing and procurement roles for companies like Cisco, Flextronics and Broadcom before opening Resilinc in 2010.

“I realized that every company in the world that has a product has the same problem of being reactive [when it comes to supply chain disruptions]. If there was a company out there that could help companies map their entire supply chain and monitor their suppliers worldwide, then it could be a much more inexpensive way to achieve supply chain resiliency rather than each company trying to build this type of capability,” explains Vakil.

While building Resilinc, Vakil found her

strength and what she excelled in, which helped her recognize her weaknesses and hire the best people to fill those gaps.

“I think in any role, whether it’s supply chain or as a CEO, what you really need to do is find your strength and then find your weakness. Know your weaknesses and then find the best people to bolster those,” says Vakil. “We have people who join Resilinc because they believe in what we’re doing, they get passionate. You have to be able to bring out that in people.”

Still, there have been challenges that she has had to overcome. When Resilinc started, some people were unwilling to join on because it wasn’t an established company.

However, Vakil believes that there are always reasons to not join a company—you just have to find the most passionate people willing to take the journey with you.

“Gender aside, you’ll find the best people will join because they believe in you and what you’re doing interests and excites them,” she says. “For startups, you really need those people who will be there for the long haul. They are the ones that won’t let any of the normal ups and downs get in the way of rolling up their sleeves and doing what’s needed.”

Today’s companies are more dependent on multiple tiers of suppliers that are across the

Resilinc

www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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AWARD Bindiya Vakil visited the Bloomberg Radio studio to speak on behalf of Resilinc.

world or scattered across the country. Oftentimes, many don’t have visibility into their supplier networks or are still relying on manual processes to track and respond to disruptions. Right now, having technology, data and supplier information readily available the minute a supply chain disruption occurs is crucial to mitigate disruptions.

For example, Resilinc initially picked up the alert on the Coronavirus disease (COVID-19) spread in China on Dec. 28, 2019—months before it was declared a global pandemic. The company then alerted customers on Jan. 4, allowing them to adjust their supply chains as needed.

“We created a pandemic readiness assessment on Jan. 24 and launched it to 1,200 suppliers,” says Vakil. “As [COVID-19] made its way around the world, we were tracking and providing a lot of information to customers about what they could do ahead of time.”

Then, in April, Resilinc partnered with Premier Inc., Intalere and Stanford Health to develop The Exchange at Resilinc, a hospital-to-hospital healthcare platform that eases shortages and imbalances of medical devices and supplies.

“Within three weeks, my team, which was working completely remote, conceptualized, designed, developed, tested and launched The Exchange,” says Vakil. “We were able to leverage all our existing technology platform, all the data security that we have for our standard customer and helped hospitals secure PPE and exchange products with each other.”

Vakil is also very involved in organizations, sitting on the MIT Center for Transportation and Logistics Advisory Board, Arizona State University Department of Defense Med Log Supply Chain Advisory Board and on the founding members board of the Healthcare Transparency Initiative.

In addition, she is one of the founding members of the Global Supply Chain Resiliency Council, which aims to promote supply chain resiliency best practices and knowledge.

“When I started Resilinc 10 years ago, supply chain risk management was not a solution space.

We were educating companies as to why they should have this capability,” explains Vakil. “By having these types of industry advisory groups on

Bindiya Vakil attends the ribbon cutting ceremony of the Resilinc office.

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Resilinc

board, we have been able to bring chief Resilinc procurement officers to help educate other people about their risk program.”

Regardless of someone’s success, though, you will encounter biases—whether they are subconscious or not.

Vakil encourages women in the supply chain to be themselves, to hold their heads up high and maintain passion for what they believe in.

Especially when it comes to launching a new product, idea or company.

“What you need is to have that in inner confidence that tells you every day, ‘No, that person is wrong.’ They may wear a fancy suit or drive an expensive car, but I know my solution works. It’s never easy,” says Vakil. “Be confident in yourself. Don’t apologize all the time. It’s okay to ask for things. In fact, you should ask for things that you want. What’s the worst thing someone’s going to say? ‘No?’ Don’t be afraid of the ‘No.’” “For every yes that I got from an investor, I got 60 nos. I had to pick up Humpty Dumpty, put the pieces back together, put a smile on my face, go to the next pitch,” Vakil continues. “Don’t let the no’s bring you down because they are part of life. Don’t get let them get you disheartened.”

Congratulations Vakil, and the remainder of the Women in Supply Chain winners.

Go to www.sdcexec.com/videos/link-live for the LINK Livestream discussion with Vakil on supply chain risk management, maintaining a resilient supply chain during a pandemic and her advice for future female leaders in the supply chain.

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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AWARD HANNAH KAIN

PRESIDENT AND CEO | ALOM Hannah Kain is a long-time veteran of the supply chain industry.

Her experience as president and CEO of ALOM helped bring the company to another record revenue year in 2019.

Throughout her career, Kain has served on several industry boards and been recognized as one of SDCE’s Pros to Know over the last seven years.

In addition, when the COVID-19 pandemic first hit, Kain led the retooling of production lines to support medical equipment configuration and test kit assembly/distribution to healthcare facilities across the country. Despite the pandemic, Kain helped lead her team to a 100% on-time shipping record in Q2 of 2020. industry survive and thrive.

MARY LAMIE

EXECUTIVE VP OF MULTI MODAL ENTERPRISES BISTATE DEVELOPMENT Mary Lamie has spent the last 30 years advocating for improved infrastructure and the funding required to enhance key elements of the nation’s freight network. Lamie continues to forge partnerships to develop new transportation links between the Midwest and coastal and gulf ports to facilitate the movement of cargo between the United States and overseas destinations. Under her leadership, Bi-State Development’s St. Louis Regional Freightway enterprise received the 2017 Outstanding Local Government Achievements Award for Exemplary Intergovernmental Collaboration by East-West Gateway Council of Governments. Her primary objective is to coordinate with industry and government to enhance and grow the goods traveling through the bi-state St. Louis region.

LYNN CALDWELL

CHIEF SALES OFFICER | BANYAN TECHNOLOGY Over the last 43 years, Lynn Caldwell has served the transportation and logistics industries in various positions ranging from accounting to operations. She is the example of a “Can do, I will succeed” mindset, achieving many accolades along the way. In 2018, Caldwell joined Banyan Technology, helping the company grow its revenue by 30%. In addition, she has helped develop the sales staff to bring new products and open new markets. Always striving to support the industry through education and understanding the broader picture, Caldwell continues to be a leader. The current and recent events of the COVID-19 pandemic have highlighted the need for the supply chain and logistics industries to become more efficient and productive. Because of this, Caldwell remains drive to be a part of the solution set that helps the industry survive and thrive.

HEATHER MUELLER

CHIEF OPERATING OFFICER | BREAKTHROUGH Heather Mueller’s career has been focused on creating meaningful client experiences across the entire supply chain. Her efforts have ranged from designing consumerfocused, in-store shopping experiences to the inception and oversight of large shipper conferences. What sets Mueller apart in any role she takes on is her ability to think abstractly about the ever-changing challenges of the supply chain.

She has mastered the balance between data and relationships. Mueller has been a catalyst for Breakthrough’s digital transformation, shifting the focus from operational challenges to an industrywide revolution. www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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AWARD CHARLENE KELLER

SENIOR DIRECTOR OF ENTERPRISE ACCOUNTS CHOPTANK TRANSPORT Charlene Keller has played a positive role in the logistics industry since starting her career at Choptank Transport in 2007. In the years that have followed, she has quickly worked her way up the leader board, earning her the current position of senior director of enterprise accounts. Keller realizes the importance of giving back, though. She is on Choptank’s community involvement committee and donates much of her free time to charities in her area. In addition, she mentors others in the workplace and continues to lead by example.

ADA PALMADOTTIR

BUSINESS DEVELOPMENT DIRECTOR CONTROLANT With more than 20 years of pharmacy, management and technology expertise, Ada Palmadottir was ready to conquer 2020. Her extensive international pharmaceutical experience, specifically in product supply chain, vertical alliance sales and networking has helped her roll out global visibility solutions throughout several companies’ supply chains. In her role as business development director of Controlant, Palmadottir is responsible for ensuring the good manufacturing practice and good distribution practice compliance and validation for the company’s pharmaceutical supply chain customers. She is dedicated to finding the best ways to use supply chain real-time data to mitigate risk and take necessary actions to prevent product damage or loss.

VALERIE HOGE

CHIEF OPERATIONS OFFICER DHL SUPPLY CHAIN NORTH AMERICA As a supply chain executive, Valerie Hoge possesses the unique combination of deep expertise in strategy and data, all while maintaining a passion for coaching and empowering associates to take ownership of their work, making her a standout among her peers. Since joining DHL Supply Chain North America in 1999, Hoge has held several leadership positions overseeing, educating, training and supporting more than 480 sites across North America. In her current role as chief operating officer, Hoge has successfully delivered gross profit growth of more than 15% in 2018, while improving overall efficiency by 7%.

Meanwhile, her leadership at the beginning of the COVID-19 pandemic resulted in overwhelmingly positive feedback from customers, colleagues and board leadership.

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SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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AWARD SALLY MILLER

CHIEF INFORMATION OFFICER DHL SUPPLY CHAIN NORTH AMERICA Sally Miller’s commitment to fostering innovation in the supply chain and her actions to inspire the next generation of female leaders has been at the forefront throughout her career. During this time, she has been focused on tackling challenges with a combination of creativity and strategy, focusing on technologies that will make a difference at every level of the supply chain. In her position as chief information officer at DHL Supply Chain North America, Miller drives innovation across the business, ensuring customers are working with top technologies customized to meet their individual needs. Thanks to her leadership, the company has taken a pioneering role within the contract logistics sector in deploying new technologies. Meanwhile, Miller has made it a goal to develop talent on her team. Due to her efforts, the company saw a decrease in IT department turnover, while her mentorship of high-potential female colleagues resulted in increased leadership development opportunities.

JILL HOCHSTETLER

SENIOR MANAGER, LOGISTICS OPERATIONS JARRETT LOGISTICS SYSTEMS As senior manager of logistics operations for Jarrett Logistics Systems, Jill Hochstetler manages a team of highly qualified professionals overseeing some of the most complex supply chains in the United States. She is a valued mentor for her peers, overseeing the execution of important client goals and initiatives all while managing new client expectations. In less than 10 years at Jarrett, Hochstetler has earned five promotions to reach her current role, demonstrating a passion for the development of herself and her team. She is dedicated to guiding her team toward personal improvement, inside and out of the office. As a result, Hochstetler has promoted over 20 people, including three to a logistics manager role.

BERNADETTE VALENCIA

VICE PRESIDENT AND GENERAL MANAGER, GUAM & MICRONESIA MATSON NAVIGATION COMPANY Bernadette Valencia is vice president and general manager for the Matson Navigation Guam Hub, responsible for managing the shipping of a great majority of goods imported to sustain daily life and maintain the quality of life in the communities. Under Valencia’s leadership, Matson Guam enjoys a majority of the local market share by maintaining a strong reliable network and define on-time service within hours. When the COVID-19 pandemic first began, Valencia gathered her team to embark on a public service campaign to create communitywide awareness. By putting the residents’ well-being and welfare at the forefront, she was able to reassure that shipments would still be scheduled and uninterrupted to the communities they serve. www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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AWARD PAULA PETERSEN

VICE PRESIDENT OF PROCUREMENT PRIDE INDUSTRIES Over the last 30 years, Paula Petersen has had a successful career spanning across different companies. Since joining PRIDE Industries in 2012, Petersen helped develop a procurement department that provided vision and innovation to optimize the entire spectrum of supply chain capabilities.

She has had the privilege of engaging with company leaders and suppliers throughout the globe, gaining respect and perspective for diversity in many forms. Petersen remains focused on making things possible out of situations that were once deemed impossible. She believes that building productive relationships and helping others to do the same is a key component of success.

MEGAN SMITH

CEO SYMBIA LOGISTICS

Under Megan Smith’s guidance, Symbia Logistics became a WBE-certified company. This designation meant that she was able to retain her largest client, protecting all of the jobs of more than 1,000 employees. During this time, she still sees the biggest challenge as encouraging customers to adapt new processes instead of relying on traditional legacy methods. Smith continues to contribute empathy, kindness and generosity to her business and to the industry as a whole.

JANET BAYS

SENIOR IT MANAGER, APPLICATIONS AND DEVELOPMENT TOYOTA TSUSHO AMERICA, INC. TAI Janet Bays was one of Toyota Tsusho America’s first employees, and for 30 years has helped grow TAI’s IT capabilities from homegrown systems to implementation of Tier 1 solutions for WMS. She currently leads all application and development and manages a team of 12. A natural project lead, Bays understands both the business and technical aspects and can speak intelligently to everyone on a project, bridging the gaps between IT, systems, operations and business/finance. She strongly believes in looking ahead and initiating discussions at TAI around AI, blockchain and other transformative technologies to benefit the company’s U.S. and global operations. She sees her role as identifying the IT solutions and platforms that allow Toyota Tsusho to make decisions quickly and confidently for optimal company performance—today and in the future.

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SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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AWARD Additional Women in the Supply Chain Winners Gillan Hawkes

Pauline Potter

Elli Bowen

Terry Onica

Dionne Quiachon

Isabel Fernandez

Ashley Miller

Katherina Lacey

Rossella Lospennato

Laura Hunter

6 River Systems A&R Logistics

Alpha Logistics Services (EPZ) Ltd

Carla Jeffries Americold

Efficio

KC SmartPort

Efficio

Koch Agronomic & Energy Services (Koch Industries)

Karen Smith

enVista

Kontoor Brands, Inc.

Megan Bishop

Andrea Gauntlett

enVista

Linen Holdings (division of Bed Bath & Beyond)

Marisa Brown

J.J. Barnes

Heather Sheehan

Jean Olivieri

Lynn Caldwell

Katerina Koutska Jones

Nancy Hauer

Megan Evert

APQC

AWESOME

Banyan Technology Bastian Solutions

Sheila Dooley

Bastian Solutions

Traci Nichols

Beltrees Consulting

enVista

Fleet Advantage

Emel Meteoglu

Rose Delgado

Jill Donoghue

Linda Dunn

Kelly Porter

Neha Desai Shah

Bumble Bee Seafoods Campbell Soup Company

Jackie Look Celestica

Khavita Khan Celestica

Lori Osterback

Lisa Stowater

Melissa Drew

Jody Sandy

Angie SeWell

Patricia Moser

Tabatha Helm

Laura Schwier

Katya Vladykina

Shelly Simpson

Cisco Systems Inc. Deloitte

DeRoyal

DSC Logistics - Champaign IL Ebco Industries Ltd.

Pacejet, division of 3Gtms

Danavon der Heide

Hilton

Erin VanZeeland Schneider

Ophelia Otto scoutbee

Amber Okoye

SE7EN T3 Solutions

Joanna George

Siemens Healthineers

Melissa Runge

Spend Management Experts

Laurie McGrath

Karen Stainbrook

Anu Saxena

Ronpak, Inc.

Lindsay Olla

Adrienne Palermo P&G

GoodOps

Charlotte Reese

Darcy Douglas

Optricity

P&G

GlobalTranz

REFASHIOND Ventures

Sheila Benny

Jeanne Wiffler

GHX

Lisa Morales-Hellebo

Sarah Rich

P&G

Tina Murphy

Redwood Logistics

Kristen Daihes

Elizabeth Radke

GEP

Nicole White

Sheri Hinish

Optricity

Roopa Gandhi

Railinc

Lisa Catania Opex Analytics, a LLamasoft company

GEP

Joan Smemoe

Kerstin Braun

OneRail

Georgetown University

Quincus

Diane Sullivan Omnichain

Fusion Worldwide

Divya Demato

Cheetah Technologies

Odyssey Logistics & Technology Corporation

FST Logistics

Ashley Thompson Na’ama Moran

Lindsey Shellman

Foot Locker, Inc.

Renee Krug

Chainalytics

Novolex

Flexport

LarisaMottaz Celestica

Amy Barnes

Flexport

Jill Kuhlman

B-Stock Solutions

Nigerian Breweries Plc

Olivia Watson

JoAnn Martin Blue Yonder

Nihinlola Latona

Flexport

Jenny Sim

Logility

Miebach Consulting

Janita Brock

Michelle Comerford

Anna Palmer Victoria Ma

FLEXE

Susy Schoneberg

Biggins Lacy Shapiro & Company

LLamasoft, Inc.

Fictiv

Anjana Singh Beroe, Inc.

Neelima Ramaraju

QAD

Parcel Perform

Stenn Group

Supply Chain Revolution, LLC Supplyframe Taulia Inc. Tecsys

Jenna Wagner

TEKLYNX International

Janet Deverso

TradeTrans Corporation

Kathleen Rogers

University of California, Santa Cruz

Emma Leonard

Visible Supply Chain Management

Nina Vellayan Xeeva

Stacy Schlachter

Hy-Vee, Inc.

Penske Logistics

Candy Kline

Hy-Vee, Inc.

Peoples Services, Inc.

Tammy Steinman

i3 Advantage Inc.

Peoples Services, Inc.

ICC Logistics Services, Inc.

Amy Fitzgerald Plug Power

J.B. Hunt

www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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SPECIAL REPORT EMERGING TECHNOLOGY

PHARMA INDUSTRY EXPLORES

HOW BLOCKCHAIN AND STANDARDS CAN IMPROVE SUPPLY CHAIN SAFETY Blockchain may be an effective technology for the pharmaceutical supply chain, promising potential for faster delivery of safe medications and meeting government requirements at the same time.

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lockchain technology is set to transform and secure supply chains for increased, immutable chain of custody and tracking of products as they move through distribution channels.

While the exploration of blockchain has so far been largely focused on the food industry, pharmaceuticals also see tremendous value in blockchain’s ability to securely exchange serialized data from manufacturers all the way to pharmacies.

This vision has been investigated in a number of pilot programs conducted by leading pharmaceutical manufacturers, wholesale distributors and dispensers in collaboration with the U.S. Food and Drug Administration (FDA). FDA’s Drug Supply Chain Security Act (DSCSA) Pilot Project Program is intended to assist drug supply chain stakeholders in developing an electronic, interoperable system that will identify and trace certain prescription drugs as they are distributed within the United States. It also supports an even larger vision set forth in the 2013 act, which focuses on improving supply chain visibility and transparency in the pharmaceutical supply chain.

MEETING REGULATORY REQUIREMENTS Six of the 20 FDA-sponsored DSCSA pilots completed earlier this year focused on determining the usefulness of blockchain for boosting supply chain visibility and product The ability to accurately track pharmaceutical products as they travel throughout the supply chain assures authenticity and prevents acceptance of altered or counterfeit products, helping safeguard patients from dire consequences.

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ownership traceability, as well as identifying a path forward.

All six pilots incorporated GS1 Standards as an essential foundation for improved data sharing, since the standards provide a common language that can be understood by all supply chain partners.

The DSCSA requires pharmaceutical products to be serialized and labeled with specific standardized data to support an interoperable, electronic system for identifying and tracing throughout U.S. distribution. Packages must be marked with a 2D barcode containing unique product identifiers and other regulated data elements applied in a standardized way to facilitate accurate product tracking across the healthcare supply chain. This will also associate the physical product markings with the serialized electronic data exchange that will be required, per DSCSA, on or before Nov. 27, 2023.

The DSCSA blockchain pilots also centered on verifying saleable returns, meaning if a product is returned, the manufacturer and wholesale distributor work together using standards-based systems to verify the product identifiers and the transactional data before it goes back into the supply chain.

BLOCKCHAIN RECORDS ARE PERMANENT This is where blockchain’s immutability comes in. In general, a distributed ledger’s value centers on its capability for validating product authenticity by enabling permanent and unalterable documentation of a product’s legitimacy and chain of custody.

Counterfeit products are a problem for any industry, but in pharmaceuticals, they can lead to unthinkable

S1

US

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Blockchain technology may unlock the key to critical, effective traceability through better data sharing.

consequences.

That’s why confirming the absolute authenticity of a pharmaceutical product is US S1 G a top priority.

Combined with the same GS1 Standards already being implemented to support DSCSA requirements, blockchain technology may unlock the key to critical, effective traceability through better data sharing.

DATA STANDARDS FORTIFY BLOCKCHAIN BENEFITS A GS1 data-sharing standard called Electronic Product Code Information Services (EPCIS) makes blockchain more effective, as it can help partners

transmit key information on a transactional level—the what, where, when and why behind product movement through a supply chain.

EPCIS provides information on business process steps that occur, documents the state of the item and may even be used to capture sensor data.

IMMUTABLE DATA RECORDS PROTECT PATIENTS The ability to accurately track pharmaceutical products as they travel throughout the supply chain assures authenticity and prevents acceptance of altered or counterfeit products, helping safeguard patients from dire consequences.

Blockchain’s main benefits are its neutrality and the permanence of its data recording. Incorrect data cannot be erased from a blockchain.

As with all interoperability improvements, blockchain will depend upon the establishment of highly reliable, accurate data systems that incorporate industry standards, promising potential for faster delivery of safe medications and meeting government requirements at the same time.

It all begins with data quality.

ABOUT THE AUTHOR KRAIG ADAMS vice president, blockchain GS1 US

Automate, anticipate and accelerate growth.

Supply Chain, Connected.

Elemica digitally integrates supplier, customer and logistics data at every step of the supply chain so you can see more and risk less.

Get connected at Elemica.com www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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SPECIAL REPORT PROCUREMENT Source-to-pay technology enables organizations to bring new suppliers onboard quickly and ensure and performance management controls are in place.

SOURCE-TO-PAY CAPABILITIES HELP ORGANIZATIONS NAVIGATE “NEW NORMAL”

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ost companies have separate organizations devoted to procurement and finance, however digital transformation efforts are bringing these departments together to realize the benefits of cohesive source-to-pay strategies.

Source-to-pay integrates the functions of strategic sourcing, the requisition of goods and services and supplier payment via accounts payable. The benefits of this approach—integrated spend management—have proven to be extremely valuable in 2020.

SOURCING STRATEGIES TO MITIGATE GLOBAL TRADE DISRUPTION In response to unprecedented supply and demand chain upheaval, organizations have revamped their supply chains to restore resiliency and stability.

Source-to-pay technology has enabled organizations to execute on these new strategies to bring new suppliers onboard quickly and ensure and performance management controls are in place.

Restoring stability and resiliency in the supply chain requires agility, visibility and control through the consistent application of best practices for supplier performance and risk 26

management. Organizations need to understand the performance of their supplier base, so they can ensure they standardize on the best performing suppliers moving forward.

As the supplier pool changes, new fraud threats emerge. A host of new suppliers and new orders unwittingly subjects companies to greater fraud risk. Accounts payable automation assists with fraud mitigation by helping flag duplicate invoices while assisting with reconciliation by acknowledging inventory receipts via three-way matching. It also ensures consistent controls such as multi-factor authentication, which requires users to verify their identities with at least two types of credentials.

GETTING CRAFTY WITH WORKING CAPITAL Cash flow is a perennial priority for organizations, but research shows that organizations are now placing an even greater emphasis on freeing up cash.

According to a study from The Hackett Group, the 1,000 largest U.S. companies had nearly $1.3 trillion in capital needlessly tied up in receivables, payables and inventory—about 10% of their combined 2019 revenue.

Researchers say companies

are making liquidity and cash flow a top priority. Chief financial officers are focused on cash visibility and driving cross-functional working capital improvement efforts.

They’re implementing digital transformation capabilities to automate collections and payables, working to improve forecasting and seeking to optimize and standardize how they collect from customers, pay suppliers and manage inventory.

A Medius survey shows that many companies have changed supplier payment routines to manage cash flow and supply chain uncertainties in the midst of the Coronavirus disease (COVID-19) outbreak. The data, which compared March through May against the same time period in 2019, showed many companies have changed their payment behavior by either increasing or decreasing days payable outstanding (DPO). This suggests that businesses use the DPO metric to guide decisions on supplier payment procedures to adapt to the specific challenges caused by the pandemic.

Companies experiencing limited cash availability have increased DPO to manage cash flow challenges during the COVID-19 crisis. Conversely, companies

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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SPECIAL REPORT PROCUREMENT with a healthy cash position are paying suppliers early in return for discounts or to mitigate supply chain risk.

One added benefit of adoption of source-to-pay capabilities is that these functions are digitized—the gateway to automation, which in itself can add to the bottom line. Analysis from McKinsey & Company shows 56% of the tasks associated with the source-to-pay process are fully or largely automatable via technology, and that source-topay activities as a whole are well suited for automation.

The analysis found 88% of tasks can be automated in the placing and receiving of orders

and 93% in payment processing.

And, that 47% of vendor selection and negotiation activities are also good candidates for automation.

Using industry benchmarks that suggest that most organizations waste 3-4% of overall external spend on excessive transaction costs, inefficiency and non-compliance, McKinsey estimates that for an organization with an annual spend of $2 billion, eliminating that leakage could add $70 million a year to a company’s coffers.

KEEPING UP WITH NEW WORKFORCE REQUIREMENTS Source-to-pay-enabling

technology is often cloud-based.

Working in the cloud ensures business continuity to keep businesses up and running by safeguarding the data against scenarios that threaten to disrupt operations.

These are unprecedented times, that will require organizations to make the necessary adjustments in their source-to-pay operations.

Fortunately, technology can help organizations be more agile, adaptable and strategic to navigate the “New Normal.”

ABOUT THE AUTHOR SHANNON KREPS vice president of product marketing, Medius.

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EXECUTIVE FOCUS

TRANSPORTATION

SUPPLY CHAIN

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INNOVATION INSIDE THE WAREHOUSE AND ON THE ROAD Establishing a systematic process for evaluating and piloting emerging technologies is a good first step to streamline and accelerate an application for its customers.

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s supply chains continue to face unprecedented disruptions, shortages and changing consumer demands, many companies are looking to automate as a way to keep products moving. The challenge is identifying those automation technologies that can help create and strengthen the global supply chains of the future.

Establishing a systematic process for evaluating and piloting emerging technologies is a good first step to streamline and accelerate an application for its customers. This allows companies to identify and provide insight on emerging technologies that have the greatest potential to accelerate the digitalization of the supply chain.

AUTOMATION INSIDE THE WAREHOUSE One of the biggest advances inside the warehouse is the move away from inflexible and capitalintensive mechanized automation systems to more flexible autonomous guided vehicles (AGVs) and autonomous mobile robots (AMRs).

AGVs are already wellestablished in the warehouse and will continue to play a key role in enabling greater productivity.

Available in a variety of sizes and configurations, they can be an economic alternative to conveyors or forklifts for products moving repetitively over fixed routes, such as transporting raw materials to production lines or finished goods from packaging to shipping.

Forklifts also now entail automation capabilities that allow them to work in either autonomous or manual mode.

This provides the flexibility for the truck to work as an AGV when performing repetitive tasks or as a traditional forklift operated by a driver when required.

A newer development is the emergence of robot-assisted picking, which has quickly become a valuable tool for warehouse operators supporting e-commerce or omnichannel fulfillment. As more warehouses have been forced to accommodate smaller order sizes

A newer development is the emergence of robot-assisted picking, which has quickly become a valuable tool for warehouse operators supporting e-commerce or omnichannel fulfillment.

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and more each picking, manual picking processes have been stretched to the limit.

AMRs, available in a variety of configurations, work with pickers to reduce travel times and increase operator productivity.

Robotic palletizing and depalletizing systems provide similar benefits in working with cases or cartons. They bring greater speed and reliability to the heavily physical task of palletizing or de-palletizing while enabling the ability to build pallets for efficient in-store replenishment.

Robotics will become increasingly important to warehouse operations, and in some industries, will be essential to delivering the speed and accuracy customers expect.

DH rica L Su pply Chain, North Ame

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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AUTOMATION OUTSIDE THE WAREHOUSE Venturing beyond the warehouse, autonomous driving is also quickly gaining traction. It is most easily achieved in closed, private environments where processes are clearly defined and controlled.

Semi-trucks controlled entirely by artificial intelligence (AI) may still be a few years away, but companies managing large vehicle fleets need to be aware of the advances in technology and the impact they might have.

Autonomous and semiautonomous delivery vehicles are also being tested to determine their viability for use in shuttle and same-day customer deliveries.

Mileage efficiency is also being tested on longer runs from major markets to other operations across the country.

Another area outside the warehouse are autonomous electric yard trucks, which use radar, camaras, ultrasonic sensors and LiDAR to move trailers to and from dock doors and yard locations. They could provide an ideal solution for executing all types of yard logistics, including maneuvering and repositioning transport items such as pallets and swap bodies.

Platooning is also gaining interest. This is where a humandriven vehicle leads the way while a convoy of autonomous vehicles

trail behind. The front vehicle acts as a command center, determining the direction and speed of travel.

The small distance between the vehicles reduces drag, which can cut down fuel consumption by up to 10%. It is also expected to bring down traffic jams by one-third.

It is important that your company researches to identify which technologies best fit your operations. The key is to move forward to ensure you realize the full value of these solutions.

ABOUT THE AUTHOR SALLY MILLER chief information officer DHL Supply Chain, North America

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EXECUTIVE FOCUS

WAREHOUSING

PERFECTING THE BALANCING ACT OF

INVENTORY

I

Out-ofbalance inventory that might have amounted to a minor stumble back in the 20th century could now be catastrophic, if not fatal.

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nventory management is fundamentally a balancing act.

Organizations are constantly balancing achieving profitable service levels against the cost of holding inventory, while facing the headwinds of variable demand. Trying to optimize one traditionally meant negatively impacting another.

That’s been the case for decades, but much has changed.

Years ago, supply chain dynamics were far simpler. If you lost your balance and stocked too much or too little inventory, markets were more forgiving. A fall was rarely fatal.

Today, inventory management is like walking a high-wire tightrope in a hurricane. Supply chain professionals are buffeted by gale-force winds of global complexity, rising customer expectations, vast volumes of fast-changing data and fierce competition from digital native companies. And, now the Coronavirus disease (COVID-19) crisis has only raised the stakes.

Out-of-balance inventory that might have amounted to a minor

MANAGEMENT stumble back in the 20th century could now be catastrophic, if not fatal. And, we’re already seeing the fallout in consumers hoarding in the face of perceived scarcity and companies in financial peril from uncertain projected recovery.

OUTDATED TOOLS A fundamental problem underscores the inventory dilemma. Supply chain professionals are trying to solve modern inventory challenges with yesteryear’s tools, largely based on analytic models that aren’t well suited to the complex multiechelon supply chains of today.

An analytic model is basically a mathematical equation that helps managers generate rules based on parameters (demand, lead time, output, various costs, etc.) to optimize inventory.

Analytic models are mostly on historical data and are geared to solve known problems—not adapt to unknown problems and inevitable disruptions as they occur. The result can be inaccurate models that introduce additional problems and require workarounds.

While analytic models are most prevalent, simulation and heuristic-intuitive models offer alternatives that are more flexible and better suited to fast-moving multi-echelon supply chains.

Tools based on simulation

models give managers the ability to input a range of potential constraints (as well as historical data) to forecast options for inventory management.

BREAKING THE BONDS OF LIMITING INVENTORY MODELING Despite their utility, models based on analytics, simulations and heuristics have suffered from limitations that weaken their effectiveness.

Unlocking data. The data available to inventory management tools has been typically incomplete, outdated and of questionable quality.

Supply chain teams were not set up to pull information from the dozens or hundreds of software applications that run a global supply chain—systems for enterprise resource planning

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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(ERP), procurement, production, warehouse management, materials requirement planning (MRP), logistics and more.

But, a recent revolution from cognitive automation has pushed intelligence into the data layer to self-discover and ingest needed data. Supply chain teams and their IT counterparts are relieved of the burden of months-long data integration projects. And, this intelligence translates into pre-aggregated and cleansed data that becomes available to a new cognitive processing layer.

Making simulation smart and adaptive. None of the existing tools or models can account for the full range of potential business scenarios. When the unexpected happens, supply chain professionals are forced to scramble to devise a solution.

But, simulation is now being combined with decision digitization, which means simulations can be incorporated in more variations, with more context and at a faster speed. A It’s time to explore moving from people doing the work with the help of machines, to machines doing the work under the guidance of people.

Aera Technology

cognitive layer can simultaneously evaluate scenarios against business goals and quickly come back with optimized solutions, essentially creating continuous inventory balancing.

Unleashing people potential.

The time and cost of resources needed to utilize legacy tools has been high. Worse, it’s difficult to find and retain qualified professionals eager to take on labor-intensive manual work. And, if an expert who devised a certain mission-critical model leaves the company, that knowledge disappears as well.

Cognitive automation has introduced a very different dynamic for leading organizations.

With thousands of daily decisions being evaluated by a cognitive layer, people suddenly have the time to do what humans do well—finding new and innovative ways to satisfy the customer.

People can focus on the strategic management of extremely complex and ever-changing data and supply chain ecosystems, guiding machines to move toward new outcomes.

COGNITIVE AUTOMATION FOR INVENTORY OPTIMIZATION Cognitive automation changes the game. The technology brings together Internet-scale compute power, real-time data aggregation and artificial intelligence and machine learning (AI/ML) to optimize inventory at speed and scale not humanly possible. Here’s how it works:

Cognitive automation starts with thousands of daily Google-like data crawls across enterprise applications to create a single top-level layer of virtualized data. There, the data is indexed, cleansed, normalized and enriched. For the first time, the enterprise has the real-time end-to-end visibility for inventory optimization.

Then, sophisticated AI/ML algorithms analyze the data for anomalies, risks and opportunities.

AI offers recommendations on optimal actions that teams can follow to optimize inventory, or it can be authorized to take action autonomously. It’s able to learn over time and assess the quality of inventory decisions made, driving continuous improvement.

Cognitive automation also gives teams the flexibility to utilize more effective simulation and heuristic models to identify and address disruptions quickly and decisively.

Cognitive automation is in use today at leading global enterprises to solve unexpected challenges faster, forecast more accurately, generate millions of dollars in bottom-line payback and better manage inventory and other aspects of the end-to-end supply chain.

ABOUT THE AUTHOR NAVEEN KUMAR customer engagement director Aera Technology

www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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EXECUTIVE FOCUS

SOFTWARE & TECH

SUPPLY CHAIN

CYBERSECURITY GO DEEP, VERIFY AND AVOID THE COMPLIANCE TRAP Even organizations with sophisticated cybersecurity processes, teams and tools can be inadvertently compromised by a supply chain partner victimized by a successful cyber-attack.

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hird-party cyber risk affects every business in every industry, everywhere. Literally (and virtually) every company lies within range of bad actors who launch attacks every day. Supply chain interconnectivity puts every participant at risk. That said, adversaries search for the weakest link in the chain, establish a beachhead and use it to achieve their objectives.

Even organizations with sophisticated cybersecurity processes, teams and tools can be inadvertently compromised by a supply chain partner victimized by a successful cyber-attack.

Criminals can use legitimate credentials stolen from a trusted partner to access the systems of a more mature organization upstream from the point of entry. Once on the inside, they can inject malicious software that affects critical systems or steal sensitive data or intellectual property that can be shared with competitors to create counterfeit or similar products that neutralize market advantage and drain revenue. When criminals target an otherwise healthy organization downstream from the point of

entry, an efficiently functioning end-to-end supply chain slows or grinds to a halt.

In other words, the scope of a cybersecurity initiative should extend beyond enterprise boundaries. An original equipment manufacturer needs visibility into the cybersecurity hygiene of its first-tier suppliers, those suppliers’ suppliers and so on throughout the chain.

Above and beyond visibility, a manufacturer would be wellserved to verify the accuracy of what it sees and what its suppliers report about their cyber health.

But, what makes for strong cybersecurity? Too often, companies fall into the trap of equating security with compliance. They believe that by complying with a recognized standard, that they magically have become secure. Unfortunately, they have settled for a false sense of security because compliance and security are not one and the same.

Organizations will find compliance is an insufficient measure of security because compliance only requires “checking a box.” Those looking through a compliance lens may be tempted to choose the lowest-cost solution to fulfill a

security requirement, regardless of that solution’s performance or sufficiency.

Relying on a compliance lens quite possibly compromises security, rather than enhances it. Use of a risk lens represents a better approach. Although risk cannot be eliminated completely, this lens drives businesses to evaluate policies and solutions relative to their efficacy.

For example, in response to the ongoing loss of vital controlled unclassified information (CUI) by its supply chain, the U.S. Department of Defense (DoD) implemented a regulation in late 2017 requiring any organization handling or storing CUI to comply with the 110 cybersecurity controls identified in Special Publication 800-171 issued by the National Institute of Standards and Technology (NIST 800-171).

The goal of a cybersecurity endeavor should not be compliance. Companies realize effective cybersecurity only when their mission becomes risk mitigation. They must swap the compliance model for a maturity model, which extends the compliance model and addresses its shortcomings. A maturity model examines not only if an organization meets a standard’s requirements, but also how well.

A company’s best protection comes when it obtains visibility into the cyber hygiene of participants at all tiers.

ABOUT THE AUTHOR STUART ITKIN vice president, marketing and product management Exostar

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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EXECUTIVE FOCUS

PROFESSIONAL DEVELOPMENT

ARE YOU A MANAGER OR A LEADER?

SIGNS YOU NEED TO MAKE A CHANGE

In reality, many leaders are still managers who have not yet made the transition to their leadership role.

T

he word “leader” always reminds me of the word “parent.”

Just because you have a child, you are deemed a parent, but it doesn’t mean that you are a good one. It’s the same with the word “leader.” People are assigned the title of leader, but it doesn’t calibrate how good they are in that position.

In reality, many leaders are still managers who have not yet made the transition to their leadership role. Here is a list of six signs to watch out for when leaning into leadership.

1. YOU FOLLOW A SET OF INSTRUCTIONS FROM YOUR BOSS If your role is to deliver on a set of targets issued by your boss, then you are still just a manager—even if you have a fancy leadership title. Without a bigger picture personal vision of the future and a motivated followership, you are not performing a true leadership role.

2. YOU RELY ON YOUR POSITION TO GET THINGS ACCOMPLISHED Does your team deliver on 34

instructions because they are inspired by you or because they just want to keep their job and their boss happy? A real leader will have real followership, which means people choose to work for him/her because they feel inspired and empowered by their passion and purpose.

3. YOU ARE BUSY ORGANIZING, MANAGING AND CONTROLLING The first reaction in any leadership role is to get busy organizing, managing and controlling instead of rising above the issues and focusing on changing or sustaining the strategic direction and longerterm market success. Managers have a day-to-day emphasis on how things are and are concerned with exercising tight control over resources.

4. YOU BECOME OVERWHELMED WITH TOO MANY PRIORITIES For leaders, strategic direction is the priority. For managers, the tasks are the priority and are often overwhelmed with “too many” priorities. If everything is a priority, then nothing is a priority.

5. YOU ARE GUIDED BY SHORT-TERM TARGETS VS. LONG-TERM VISION It is that constant push and pull from serving the long-term vision to hitting your quarterly targets that should make your leadership role exciting, commercial and relevant, but that juxtaposition brings its own jeopardy on whether you tend to lean into managing or leading.

6. YOU WAIT FOR PERMISSION TO LEAD Managers wait to be told what to do. As a leader, you should never wait for permission or the right role title to chart a course forward.

Empower yourself to step up and start making really great decisions about future outcomes and galvanize others to follow in order to achieve the results you desire.

You can be the creator and shaper of events.

Then, and only then, have you truly made the leap from manager to leader ABOUT THE AUTHOR NIAMH O’KEEFFE corporate leadership advisor & author

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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MADE IN AMERICA

By Mackenna Moralez

TYING THE KNOT

Alaska Rug Company

WITH ALASKA RUG COMPANY

W

hen the Coronavirus disease (COVID-19) pandemic put a majority of the United States on lockdown, one of the most patriotic things a consumer could do at that time was shop small and shop local.

Since March, consumers have made a dramatic shift to online shopping.

According to a Ware2Go survey in May, 88% of respondents reported their shopping habits had changed due to the pandemic. For example, 87% of respondents are shopping online, and 64% state they have replaced traditional weekly shopping trips with online ordering.

As for Alaska Rug Company, the “shop local” mindset is appreciated, as the small business continues to manufacture its products in the United States.

“The company started when my husband, Robert, and I decided to quit 36

smoking in the winter of 2010. We needed something to keep our hands busy to break the habit and started knot tying. We own and reside at the Port Bailey Cannery, and with that, we inherited lots of old fishing gear, rope and line, so we had lots of raw materials to use for our knot tying,” says Alaska Rug Company owner, Anita Shane. “I have always loved rugs and thought it would be a great way to re-purpose and recycle the retired fishing gear on the property. After the first year, we started making so many other items and mostly because Etsy customers requested various items.

Once we made something, I took pictures and it became part of our product line. Now we carry so many items made with rope.”

Traditionally, rugs are made from wool, silk or cotton. However, in the 20th century, synthetic fibers like polypropylene, nylon or polyester have often been used as they are less

expensive. Shane explains that while the main material for their rugs is rope, materials can change depending on how much time the line was in the sea and how much wear it has seen.

“We make custom rugs within a two- to eight-week time period. We differ from other rug companies in that we use mostly recycled fishing line unless otherwise requested, to braid and knot our rugs,” Shane explains. “Our rugs are virtually indestructible, resistant to mold, mildew, salt water and sun, so [you] really get your money’s worth while doing your part in recycling. All our products are tagged with Made in Alaska cloth tag as well as Alaska Rug Company cloth tag.”

Getting the rope for the products was easier than expected, Shane explains. She is connected with local organizations that help remove marine debris from beaches and recycles the derelict fishing gear.

SUPPLY & DEMAND CHAIN EXECUTIVE | September 2020 | www.SDCExec.com

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Rug Company

Alaska Rug Company

In addition, word spread quickly within the fishing community that the company was repurposing old line, so various fishermen got in touch to pass off their materials to save money.

“We advertise on local Facebook groups and work with companies, like NetYourProblem.com, that connects fishermen and communities with recyclers of all kinds,” says Shane. “We also had quite a bit of old gear on site, which we have used about 80% of over the last nine years. When we go to the town of Kodiak to get supplies and groceries, we will swing by the landfill and pick out of the fishing gear area what we can get that hasn’t been buried.”

In order to make a rug, the rope must be cleaned, which can be done through the rain. Shane explains that to get the rope thoroughly spotless, she flips the coils every week. She then goes through to assure that all hooks and ganions are removed and stretched out.

“We normally coil into 200-foot sections and then stack in [our] warehouse,” says Shane. “If it still needs [to be] cleaned out, we will tie it off to dock and let the ocean do a lot of the work, as the tide comes in and out twice a day. We then will sit coil on dock to dry in sun or bring it to the house and dry by the fire if its material that is needed for an order.”

As it is only Shane and her husband making the products, they make sustainability a priority. She explains that they only use paper bags on site as packaging materials, and the company itself is solely an onlinebased company.

Since starting in 2010, approximately 700 miles worth of raw

Alaska Rug Company has procured rope from fisherman to make their products.

When first starting out, Alaska Rug Company utilized social media to find materials to make their rugs.

materials have bypassed oceans and landfills.

“I think sustainability is becoming more important for all companies, across all industries because it improves brand image and gives competitive advantage,” says Shane.

“I love that more people care about that environment and the impact we have on it, so I am proud to own an eco-friendly company.”

Alaska Rug Company does offer customization to its products. The company offers dying, spray painting or even purchasing new ropes for their customers.

“Each item does vary, so I try my best to be clear on all my sites and listings that the item received might be slightly different from one pictured.

We assure that the rope is all cleaned thoroughly and will not use damaged line with online sales. Within Alaska stores, the line that has markings on it such as rust from where a hook laid on it in tub sells the best,” Shane explains.

Now more than ever though, it is important to shop for products that are manufactured in the United States,

Alaska Rug Company’s workspace.

as it is crucial to help maintain the economy.

Shane explains that shopping local can also help reduce transportation costs and lower the company’s overall carbon footprint.

“Manufacturing in the United States supports American families and the future of our country. In the big picture, we are so small, but when we do purchase items needed such as cleats, rope and nails for our signs, we buy from American-based companies and it’s something that has become more important to me in the last few years.”

www.SDCExec.com | September 2020 | SUPPLY & DEMAND CHAIN EXECUTIVE

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It doesn‘t matter if the products are picked into totes or cartons, onto trays, pallets, or roll containers, or other dispatch units. All warehouse solutions – whether highly automated, semi-automated, or manual – are modular and based on standardized system components.

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