Archive for July, 2009

Hyper Hyping Technology

July 17, 2009

In a recent AMR Research article on Business Week, Kevin O’Marah states “As businesses prepare for a new normal of hyper-volatility, the limits of the Japanese-inspired, low-tech, Lean philosophy are starting to show”. He goes on to use the latest AMR research on Supply Chain Risk to support his premise that the increasing level of supply chain complexity and risk requires an increase in the use of supply chain technology. This doesn’t surprise me coming from a technology industry guru, the answer to everything is always more complex technology.

However, his survey results don’t really support the idea that simpler (Kanban) is not better, the companies surveyed seemed to realize this year that the most successful supply chain risk mitagation strategies were closer collaboration with your suppliers, clear communication of expectations to your suppliers, and having a backup plan. The more things change, the more they stay the same, technology is a tool that can be leveraged to execute business more efficiently, but it cannot replace strong realtionships and clear communication in mitigating supply chain risk. In most cases, simpler is better…

Supply Chain Risk: Kanban Won’t Cut It

Posted by: Rachael King on July 16

Today, Kevin O’Marah, chief strategy officer for Boston-based advisory firm AMR Research, is guest blogging. Here’s his post:

Somali pirates, oil prices on a roller coaster, and poison peanuts are typical of the new reality for global supply chains in these crazy, turbulent times. As businesses prepare for a new normal of hyper-volatility, the limits of the Japanese-inspired, low-tech, Lean philosophy are starting to show. The global supply chain in 2009 is a lot more than just a factory and a loading dock – today’s system of plants, distribution centers and retail outlets works more like a worldwide telecoms network than an assembly line. Add a hefty dose of supply chain risk to the mix and a tech-free Lean gospel just can’t hack it anymore.


Success with Supply Chain Technology

July 13, 2009

A recent article from AMR Research defends SCM technology. Supply Chain Technology itself is not the issue, the issue driving success or failure is well summed in the excerpt “When technology–not surprisingly–doesn’t solve the organizational and process problems, it gets blamed for the organizational shortcomings”. SCM technology is a tool, it is used to execute organizational strategy, if that strategy is not well formed or the processes that are supposed to support it are not aligned properly, the technology does little more than automate the same problems that existed without it. Successful SCM technology implementations start with well aligned strategies and supporting processes, without this foundation the technology will be sure to fail…

Defending SCM Technology: It’s Not the Answer, but a Damn Good One

AMR Research | July 01, 2009

Master Your Future

July 3, 2009

Are you a ‘master’ of your supply chain. If you are, a recent Accenture survey says you have “achieved 10 percent greater forecasting accuracy than their counterparts did; that service management masters attained 33 percent better turns on “spares” inventories, and that masters of sourcing and procurement delivered 2.5 times more value for every dollar they spent on procurement than companies that haven’t achieved ‘masters’ status did.”

supply chain master: a definition

New research into high-performing supply chains looks at what sets the best apart from the rest …

By Mark B. Solomon, Senior Editor
From the July 2009 issue

Rational Decisions

July 3, 2009

Retailers and wholesalers have made significant inventory adjustments over the past 18 months in response to declining sales. This restructuring has impacted the manufacturing sector hard as they lose not only the reduction in sales, but the associated downward adjustment in inventory levels as well. The question is whether an uptick in sales will be accompanied by an associated increase in stocking levels, leading to an exagerated uptick in manufacturing requirements. If optimization techniques are properly applied, then we should expect to see some increase in stocking levels as consumer demand increases, just as we have seen stocking levels decline with decreases in consumer demand. This makes the task of managing manufacturing resources all the more critical during these periods of drastic demand swings…

SUPPLY CHAIN STANDARD: Rationalised and Optimal

July 1, 2009 — The current recession has seen massive destocking by retailers – is this the new norm or will the shelves fill up again come the upturn?

Lean Supply Chain

July 1, 2009

As you look for ways to reduce working capital and improve your cash position, don’t forget to look outside your own organization at your suppliers and customers. Optimizing inventory levels within your own company involves making inventory provisions to cover execution deviations that occur outside of your control. In many cases, your suppliers and/or customers are duplicating those provisions in their own inventory optimization strategies. Working closely with your supply chain partners to share information can yield significant reductions in total supply chain inventories.

Supply Chain Management: Invest in Your Suppliers

By Scott A. Heintzelman

Lean manufacturing is a term that has gained great exposure during the last 10 years. If you know about Lean, you’ve probably heard about reducing waste of all kinds on factory floors through improved processing efficiencies. What you may not know is that Lean philosophy can be applied to other parts of your operations as well as Supply Chain Management.