by MPO website
You’ve likely heard it said countless times: Ask 100 people to define supply chain Control Towers and you’ll get 100 different answers. With a wide array of Control Tower solutions on the market, each with their own capabilities and differentiators, it can be challenging to decide which is the right fit and how to sell it internally. There are also many ways to implement a solution, so even after purchase, your strategic work has only begun.
Inspired by a recent conversation between principal Nucleus Research analyst, Andrew MacMillen and Alkimius founder and CEO, Mauro Gonzalez, here are some frequently asked questions we encounter on the topic, as echoed in some of their discussions.
1. What are supply chain Control Towers?
Nucleus defines Control Tower solutions as software which extends the view of an organization’s operation for supply chain planning and execution purposes. While there are a number of competing definitions, at the heart of it, Control Tower solutions aim to centralize data and visibility to maximize efficiency, coordination, and collaboration. What sets solutions apart is typically the scope, breadth, and depth of the offer:
What data is being centralized (Planning? Execution? Both?)
Across which areas of the supply chain will you gain visibility? (Upstream? Downstream? Reverse? All of the above?)
What degree of control will you have over the insights you see? (Will you have to log in to another system to act or will you be able to do so from directly within the app?)
Control Tower solutions are meant to help businesses better manage their data – such as information about stock and order and distribution requirements – in order to improve the flow of products through the supply chain and meet targets, like delivery schedules and service levels. The more a solution connects this disparate information into a single view – converging both planning and execution, as well as all order and flow types – and enables in-app actionability, the greater a business’ ability to drive process improvement, cost reductions, and on-time and in-full (OTIF) delivery.
2. What kind of ROI does a digital Control Tower typically drive?
Results will certainly vary by business need, size, and complexity. The move to digitize operations will help any organization to automate and resolve repetitive tasks in a valuable, time- and cost-saving way. That said, companies running large and complex operations have the most to gain from implementing a Control Tower technology, especially one that’s part of an orchestration platform which can integrate their entire end-to-end supply chain ecosystem.
When managing a sizeable, global network, there’s tremendous advantage in having real-time decision-making and advanced problem-solving across all material vendors and logistics service providers. Visibility and control over all orders, inventory, and transport allows organizations to really track and trace and optimize every cost detail from start to finish and stay flexible and agile during disruption.
According to Mauro Gonzalez, founder and CEO of Alkimius Group: “The Innovation and Transformation Platform,” there are both measurable and immeasurable benefits to implementing a supply chain Control Tower. In Mauro’s experience, just from implementing the technology, businesses will save 4-6% in manpower optimization and 3-7% in operational costs from centralization and digitization. From there, businesses can save anywhere from 5-10% in transport opportunities and an additional 3-5% in efficiencies across inventory, warehousing, distribution, and other parts of the supply chain. Depending on the organization’s maturity and complexity, the numbers could be higher or lower.
Beyond these measurable savings, a holistic Control Tower solution helps companies manage risks and get closer to their customers – a priority for any successful business model. Improvements in management and communication, as well as data mining and integration, open up new possibilities for companies to really analyze their performance against customer experience and satisfaction. For example, by better answering questions like: What does the customer really want? And how can I anticipate their needs?
3. How can you ensure a successful software implementation?
No two companies are alike, and everyone begins the process at different stages of maturity. There can also be disparities in maturity across different areas within a company. Some will try to run before they can walk, zipping from zero to 100 and expecting everything to be seamlessly integrated and coordinated. But doing so can easily jeopardize operations. It’s important to understand that these transformations are a journey.
Indeed, based on conversations with customers, Nucleus Research analyst Andrew MacMillen revealed that the most common source of failure is project scope. That’s why Alkimius Group always conducts a preassessment for its customers first. Only after everyone has a clear idea of the starting point – or how they define ‘business as usual’ – and where they plan to go from there, can they begin building a roadmap that coordinates the tremendous organizational shift with other projects, priorities, and objectives.
The same is true for the greater multi-party network; companies must establish trust and buy-in. “If your partners aren’t on board with your vision, the solution you choose – no matter how robust – will ultimately fail,” says supply chain expert, Bryce Boothby. “As you define your priorities, also use this process as an opportunity to consult your network about how your needs align.”
In his recent article, MPO VP of Solutions Implementation, Gerry Daalhuisen, points out: “A successful implementation is also about connecting different worlds.” The Control Tower solution will be part of a greater multi-party ecosystem, so a good software provider will set up scoping sessions and workshops to grasp all the different business requirements and processes involved.
Once integration is complete and the platform is boosting efficiency and collaboration, businesses can focus on velocity and continuously improving how they leverage the platform, adding their “could haves” and “would haves” to their implementation roadmap.
4. How can a supply chain Control Tower help you innovate?
Control Tower technology is creating tremendous opportunities to reshape business models. End-to-end data integration and visibility on a single platform helps businesses anticipate their customers’ wants and needs and expand their offerings to broaden choice, improve convenience, and establish differentiation. Whether that means rethinking how they’re producing, stocking, or operating their supply chains, businesses can become more strategic and customer-centric.
By improving efficiencies and enabling automation and dynamic networking, businesses can also do more for the environment through sustainability initiatives. Moreover, when Control Tower technology spans returns management, companies can offer customers a greater value-add and engage in the circular economy.
Businesses can also innovate their approach to supply chain resilience and risk management. Real-time insight across the supply chain and in-app actionability helps leaders see their operations against the bigger picture and implement strategic and timely changes that continue providing the highest service levels and flawless customer experiences despite political, environmental, or economic shifts.
A full-size, cashierless Amazon grocery store_
Amazon is installing its automated checkout technology inside an under-construction Amazon Fresh location in Ballard, permitting documents and ongoing renovations visible from the sidewalk suggest.
The Ballard store could be the largest cashierless Amazon location yet, as well as the first full-size Amazon Fresh store with what the company calls its “Just Walk Out” tech. Amazon Fresh is the company’s line of midpriced markets, aimed at competing with grocery giants like Safeway and Kroger, which owns QFC.
Permits submitted last year for renovations to the former Ballard New Seasons Market at 951 N.W. Ballard Way describe ceiling-mounted racks designed to hold a vast array of cameras. The documents also describe enlarging the site’s existing computer server room. And a row of automated sliding gates at the store entrance is visible through several small holes in the paint covering the windows.
Those features are similar to the infrastructure installed in Amazon’s nearly 30 smaller Amazon Go stores worldwide.
Amazon declined to respond to questions. The contractor, Abbott Construction, did not immediately respond to questions. The architect, BRR, referred questions to its client on the project — whose name it did not disclose.
However, an envelope left leaning against the window of the Ballard grocery store is addressed to Amazon Fresh at that location.
And an electrical permit filed last summer suggests the grocery store is envisioned as an Amazon Fresh. That permit referred to the site as “Amazon MAC8,” a naming convention in line with how Amazon refers to other Fresh stores. Amazon operates 11 Fresh stores, with plans to open nearly 30 more, Bloomberg reported last month.
Amazon unveiled its cashierless technology to the public in 2018, at a pocket-size Amazon Go convenience store on the ground floor of a building in its South Lake Union campus.
Customers enter the store by swiping their credit card or an Amazon app at the automated gates. Sensors in shelves detect when customers have removed items and a huge network of cameras keeps track of what’s in customers’ carts or baskets. When they’re ready to leave, customers don’t stop at a cashier to pay: They just walk out. Software sends them a digital bill for what they’ve removed from the store.
When the company began designing the concept behind Amazon Go, its engineers envisioned using the technology in large, big-box grocery stores. But technical hurdles have kept Go stores relatively small — so far.
The first Amazon Go store was a tiny 1,800 square feet; today, the Seattle area’s largest — in Overlake — is 18,000 square feet.
At 25,000 square feet, the Ballard location would trump them all. Similar permitting plans filed for a store in Connecticut suggest Amazon is building an even larger automated grocery store there, on a 34,000-square-foot site.
Amazon has said its cashierless technology is aimed at enhancing the customer experience, not slashing grocery jobs. And it’s had big hiring campaigns at its two other soon-to-open Amazon Fresh locations around the area, in Bellevue’s Factoria Mall and at Seattle’s 23rd Avenue and Jackson Street.
Still, the expansion of the cashierless technology will likely mean Amazon — which has big ambitions to upend the grocery sector — doesn’t need to hire as many employees at locations where the devices are used. Other grocers, too, could cut labor costs by purchasing the technology from Amazon, which began marketing it to third-party retailers last year. Airport convenience store Hudson began installing the cashierless tech at some locations in January.
Light disinfection technology works in various healthcare environments_
by Juganu website
Juganu, an Israeli startup, has developed a smart indoor light technology to fight against COVID-19.
The company’s J. Protect technology offers the potential to protect pharmaceutical professionals in laboratories and other settings against the novel coronavirus and other pathogens.
The company has recently begun several pilot programs with leading health institutions after clinically validating its potential to fight pathogens at the Bar-Ilan University Faculty of Medicine in Israel.
UVC light, in particular, has received significant attention this year, given its potential to sanitize a variety of indoor environments. The light spectrum, however, can potentially cause skin burns and eye injuries, according to the FDA.
Juganu sidesteps this problem by using longer wavelength UVA light, which has the lowest energy amount among UV rays. There is “no risk for people under this light,” said Eran Ben-Shmuel, co-founder and CEO of Juganu. “But UVA radiation manages to penetrate the outer shell of viruses and bacteria and destroy them.”
The UVA light can inactivate airborne viruses after eight hours of exposure. By contrast, the UVC mode can disinfect a room in a matter of minutes.
UVA light is present in sunlight and, in sufficient doses, can cause skin cancer. But the amount of UVA Juganu’s technology produces is significantly less than what safety regulations allow.The lighting has received an exemption from the FDA and is registered with the Environmental Protection Agency in 48 states.
Juganu’s J. Protect technology, which can integrate with traditional LED lighting, can also use UVC lighting when rooms are unoccupied. That is, its UVA light offers continuous disinfection while UVC light can kick in to accelerate disinfection after occupants have left a room.
Founded in 2011, the company has raised $18 million in a Series C funding round led by Comcast Ventures. In addition to targeting healthcare, Juganu plans on marketing the technology to schools, hotels, restaurants, airports, retail locations and other businesses.
What Does Control Look Like in the Era of Disruption?
by MPO website
There’s a lot of talk about supply chain resiliency, but what does that really mean in a practical sense?
While the pandemic is an extreme and unprecedented example, disruption has many faces – from daily exceptions to lasting and impactful events, like tariffs and natural disasters.
The first and most practical step all businesses must take to bolster their supply chain resiliency is to invest in a Control Tower and Visibility solution. Yet options vary widely, and few have the necessary capabilities to identify all the cost ant constraints within the supply chain.
Few deliver the control needed to coordinate and execute across a supply chain network during the most uncertain and vulnerable times.
Connecting at Different Stages of Digital Maturity
In the age of the multi-enterprise business network, you’re only as strong as your weakest link. And while you can’t expect all of your partners to be fully equipped with the latest and greatest advanced technologies, you can invest in supply chain software that connects with and speaks to systems at various stages of digital maturity. Remember: while you may be able to afford minor delays and errors in good times, limited visibility and latency cause significant impact upon impact during disruption.
💡Tip to Regain Control: Choose a Control Tower platform that lets you execute across a multi-party network with automated flows and support for different customers and business units. To achieve this, the technology should sit on top of any and all legacy systems to grab the information it needs – where and when it needs it – enabling a single, real-time view into what’s happening up and down the entire supply chain.
The Ability to Act on the Data You Have
The saying goes: “knowledge is power.” Practically speaking, knowledge is only half the battle. Information is only as good as what you can do with it; during disruption, time is of the essence. Once you receive a timely alert that something has happened, how quickly can you use that knowledge to your advantage? Once you know that a manufacturer or distribution center is no longer a viable option, how effectively can you onboard new partners and switch flows? The new paradigm is “knowledge is power when executed upon,” and as near to real-time as possible with automated workflows.
💡Tip to Regain Control: Look for configurability in a Control Tower and Visibility solution, as well as in-app management capabilities. Configurability is your greatest resource to boosting flexibility and delivering quick time to value: It allows you to continuously rewrite the rules, updating or adding additional flows in minutes to adapt to new conditions, requirements, and constraints.
A Control Tower that’s part of a unified platform and has an integration layer will give you the flexibility to diversify your network and partner dynamically. Easily add and set up new partners with real-time visibility and control, with the ability to seamlessly switch between them as needed.
Meanwhile, in-app control ensures you never have to log in and out of multiple systems, which wastes precious time. Whether you have to split a shipment, pick inventory in-transit, or reroute an order, your Control Tower should let you act on the visibility it provides, offering options for a resolution in a few clicks.
Command Over Finances
As it is, businesses struggle to meet high demands on thin margins. During times of disruption, margins only get thinner and customer experience is one of your greatest differentiators. Revenues tend to drop during times of crisis (the pandemic being no exception), leading to a circular loop: To save on costs, companies hold off on investing in technology that enables strategic recovery. Without the technology, revenues are harder to recover, making it more difficult to invest in the very tools that would help recover them.
💡Tip to Regain Control: Make cost visibility a key driver of your digital transformation. A Control Tower with deep and robust cost control capabilities, will help you dissect your supply chain down to the most granular elements. Visibility into your total cost picture and cost structures enables you to pinpoint avoidable charges and discrepancies within contract agreements.
To think of Control Towers only in terms of supply chain visibility is short-sighted. Access to information is a first step in a far more complex and strategic journey. Supply chain resiliency means being able to act on your data with agility. It also means having the flexibility to adapt with nuance – to fit to the specifications of each unique challenge. Not all disruptions are alike; technology is best when neutral and configurable and gives its users maximal control and flexibility to react to a very dynamic marketplace.
The CFO Cybersecurity Risk Checklist_
by gartner.com website
CFOs should recognize a new type of financial risk management related to cybersecurity risk as many finance activities are now conducted remotely.
CFOs often perceive cybersecurity to be the responsibility of IT, but as more finance processes run remotely, CFOs need to develop security measures specifically for the finance function and not rely solely on the organization’s blanket security protocols to safeguard financial data.
"Develop policies and guidelines that identify the areas in finance processes most vulnerable to attack"
A recent Gartner CFO Survey found that nearly 3 out of 4 CFOs intended to shift at least 5% of their previously on-site staff to permanently remote roles post-COVID-19. Many finance processes are already running remotely, and they incorporate some of the most sensitive data within an organization, including customer and supplier financial data.
“CFOs should neither ignore these fresh vulnerabilities nor go it alone,” says Alexander Bant, Practice Vice President, Gartner. “CFOs especially need to collaborate with both IT and risk managers to make sure new cybersecurity risks stemming from the adoption of remote work don’t outpace the policies designed to protect vulnerable data.”
Common cybersecurity risks for finance
When collaborating with IT security and risk teams, CFOs should prioritize the financial data and systems that are most critical to the business to ensure that those processes are protected. The most common threats to guard against include:
Phishing attacks: Methods to trick employees into giving up sensitive financial information, typically by email, but variations also include voice phone calls and SMS messages.
Malware: The general term used to describe any malicious software, file or program that is intended to harm/disrupt a computer.
Data leakage: This threat arises from the use of multiple devices and internet connections such as laptops, mobiles, tablets, PCs (personal computers) or home WiFi to access databases.
A cross-functional approach will also help CFOs with accurate scenario planning, as they can discuss all possible cybersecurity risks with these expert teams.
Cybersecurity checklist for CFOs
Alkimius recommends a simple three-step framework to prioritize the key objectives of a comprehensive cybersecurity strategy to safeguard finance processes and data.
Step 1: Realize
Develop policies and guidelines that identify the areas in finance processes most vulnerable to attack or the areas most likely to be intriguing to criminals. The main objective is to minimize the possibility of a successful cyberattack.
A sample mitigation tactic would be to identify key financial data assets and software applications (e.g., cloud finance solutions) and their relative vulnerability.
Step 2: Respond
Clarify the plan of action by highlighting roles and responsibilities in the case of a successful breach of financial data. Highlight the quickest possible resolution(s) when the organization faces a cyberattack.
A plan objective might be to designate a point of contact to whom all finance employees can report any cyberattack instances and a “first responder” in finance, e.g., the chief accounting officer, to analyze the exact financial impact of the attack.
Step 3: Review
Set governance policies that encourage regular check-ins on the health of the cybersecurity measures in place for finance processes to make sure the organization remains prepared for evolving threats to its financial data and for new workplace realities.
One plan objective might be to create a cross-functional team from finance, IT and risk/audit that submits regular reports on the state of financial data security.
Walmart’s Massive Investment In A Supply Chain Transformation_
by forbes website
Walmart has been very open about what it takes to better compete with Amazon Following their fourth quarter results, top executives talked about their supply chain and omnichannel strategy at a high level. Bruce Biggs, an executive vice president at Walmart, summarized the investments by saying the retailer is spending on increased fulfillment capacity, supply chain, automation, and technology. This new infrastructure will allow the retailer to expand ecommerce assortment while reducing both shipping time and cost. Walmart is making investments in warehouse automation in distribution centers to deliver aisle and department-ready pallets to stores. Walmart is also investing pickup and delivery capacity.
On March 21st, David Guggina - the senior vice president supply chain, product, and engineering - filled in more detail on the specifics of their supply chain journey while speaking at Blue Yonder’s virtual Icon user conference. Blue Yonder is a leading provider of supply chain software solutions including several solutions that will be mentioned in this article - demand management, inventory optimization, replenishment, warehouse management, warehouse control systems, yard management, and transportation management.
Walmart’s fiscal 2021 ended on January 31st. With $555 billion in sales, the world’s largest retailer grew by 6.8%. Walmart’s operating income was $22.5 billion, 4.1% of sales.
Amazon is smaller. Amazon’s fiscal year ended on December 31st. The company had $341 billion in retail revenues. Amazon is less profitable. Retail operations had an operating income of $9.4 billion, just 2.8% of sales. But with 38% year over year growth, they are growing much faster than Walmart. If this continues, it will not be too many years before Amazon is the world’s largest retailer.
Around the world, ecommerce is growing much faster than in-store sales. Walmart knows this. Brick and mortar retailers that do not have a strategy to grow sales based on an omnichannel strategy are going out of business with an increasing frequency. Walmart has been working to pivot to omnichannel for several years to help speed growth. For Walmart, “omnichannel” is defined as a customer-centric experience that seamlessly integrates ecommerce and retail stores into an offering that saves time for consumer.
Walmart’s U.S. ecommerce sales contributed approximately 5.4% of comparable sales last year. Walmart defines ecommerce sales as those that originate online but which be fulfilled by either dedicated ecommerce fulfillment sites or by leveraging their stores. The store omnichannel services include pickup at store, ship from store, and digital pharmacy fulfillment options. The company has 7,300 pickup and 5,200 delivery locations globally.
The US is where Walmart’s digital transformation is centered. Walmart’s investment in ecommerce, supply chain, and technology in the US was over $11 billion over the last two years. For retailers, remodeling stores and building new stores is usually where most of the capital has historically been spent. At Walmart, their digital transformation – spending on ecommerce and supply chain technologies, combined with new investments in supply chain infrastructure – represented 72% of their strategic capital expenditure in the US for their 2020 and 2021 fiscal years.
Mr. Guggina talked about how Walmart is approaching their supply chain transformation. “For many of our customers, saving time is as important as saving money.” That has led to growth in ecommerce. But Walmart will not abandon their strategy of being a low-cost provider – what the company calls “everyday low prices.” Low prices translate into having a focus on cutting costs; this in turn means having an efficient supply chain.
But there is tension between price leadership and service. In a store, customers have access to 100 to 150,000 stock keeping units (SKUs). But when a consumer goes online, they can access hundreds of millions of items. But there is a challenge around slow selling items. Where should slow movers be held so that orders can be fulfilled both economically and with speed.
Delivering many items ordered online quickly depends upon shorter lead times and the ability to support a variety of fulfillment options such as curbside pickup or ship from store. Distribution centers that traditionally just replenished a given set of stores will be increasingly asked to also fulfill ecommerce orders. Mid-mile and last mile transportation capabilities need to be improved. “That is a steep ask for any supply chain,” Mr. Guggina stated.
This is where Walmart seeks more “precision.” The use of demand management, inventory optimization, and replenishment applications can help this retail behemoth achieve much better inventory placement and fulfillment flexibility. Investing in supply chain applications also, Mr. Guggina asserts, helps them with their “relentless cost focus.”
The pandemic created a challenging year for their supply chain. “I’m glad we had our leadership and strategy in place,” Mr. Guffina said. “The pandemic propelled our omni strategy ahead by 3 to 5 years.” Pick up at store and home deliveries grew quickly because of the pandemic.
So besides forecasting, inventory optimization, and replenishment, how are those billions of dollars being spent in the supply chain area?
Walmart is reducing packaging waste by right sizing packaging; for some products packaging might not be required at all. This initiative requires capturing product dimensions and other product attributes with higher accuracy. The packaging algorithms do not work if this data is not up to date.
In their distribution centers, Walmart is modernizing their warehouse management system (WMS). The system, which will launch later this year, will have better labor planning, as well as providing better inventory control.
Walmart is making extensive investments in warehouse automation. The company has deployed autonomous mobile robots for moving pallets. The retailer is also investing in the use of automation for picking/putting to and from containers. There are large investments in sortation equipment; sortation systems automatically sort products down the correct shute as they move through a warehouse on a conveyor. When it comes to these projects, warehouse control systems are used to interconnect the automation assets – the hardware - with the warehouse management system software.
Investment is being made in a highly automated warehousing solution from Witron surrounding produce. Vegetables and fruits will be able to be delivered more quickly and cheaply as a result.
In transportation, Walmart is engaged in numerous projects. The company is doing a proof of concept to see if trucks can move about autonomously in their yards. The autonomous trucks will need to be integrated to an improved yard management system for this. That will lead to better flow in their yards.
There are experiments with over the road autonomous trucks. There is work being done to improve optimization associated with trucks moving inbound from suppliers to their distribution centers. There is also a project surrounding freight matching and freight pay. Not surprisingly, a command center visibility solution is being developed.
There are also new tools and applications for the cab of a truck. Their 11,000 drivers will have new onboard computers. Last mile will be improved as stores increasingly become a starting point for consumer deliveries.
“We are moving faster than ever, Mr. Guggina said. “We are partnering with Blue Yonder to help to continue to transform our supply chain.” Walmart has been known as a company that developed many of their applications in-house. “The days of buy versus build are over.” Walmart has shifted being a buyer of supply chain software.
Over my 25-year career, I have heard executives from several supply chain software vendors say that Walmart was using their solution in some part of their operations. Unfortunately, they said, they were not allowed to publicly name Walmart as a customer. Having a Walmart executive give the keynote at the Blue Yonder user conference, and publicly name Blue Yonder as a key solution partner, is a noteworthy occurrence.
Why You Need To Effectively Plan Capacity Throughout The Entire Supply Chain_
by forbes website
As vaccine distribution ramps up worldwide, all eyes are on the supply chains transporting and delivering this precious cargo. But as this urgent example of capacity planning has proven, precision is vital. Without an intelligent capacity plan in place, businesses and service providers can’t respond to rapid changes, and they risk losing out on demand.
As the COO of a supply chain management, artificial intelligence software company, I know that creating a capacity-planning strategy is both an art and a science. It requires you to determine the resources needed to meet the demand for products and services. An effective capacity-planning strategy helps plan manufacturing resources and ensure customers’ needs are served promptly.
As the reality of Covid-19 has hit the world’s supply chains, many companies and healthcare providers have realized just how vulnerable we are to capacity-planning problems. It’s no longer OK to deliver “just in time” or to have “just enough.” Commodities — from toilet paper to vaccines — are up against extreme conditions and in high demand, and manufacturers must overcome these planning challenges to keep production flowing.
The challenge of data: Capacity planners need to get their hands on a lot of diverse information to achieve maximum accuracy. If data inputs are outdated or in the wrong formats, planning will go awry. Furthermore, because manufacturing processes have often relied on siloed data systems to plan production capacity, helpful analysis can be hard to come by. Disparate, unconnected systems and their data formats must be manually reconciled (unless you're using AI to automate the most tedious processes).
The challenge of complexity: Planners use complex formulas and legacy calculations to determine a final capacity plan that is unique to their organization. Manual spreadsheets are often used to accommodate all this complexity, but if there are errors made during the data entry process, the entire plan is affected, and knock-on effects permeate throughout. Moreover, capacity planning typically occurs at multiple levels and horizons in manufacturing, and each level requires data and time that increases your risk of making a mistake.
The challenge of communication: Capacity planning involves many moving, disconnected parts, so communication gaps are likely and can pose a great risk to the plan’s integrity.
Leveraging AI In Capacity Planning
Capacity planning can never be perfect. After all, no one could’ve predicted the chaos that Covid-19 would bring upon manufacturing chains in 2020. But there are strategies you can practice to get more accurate demand insights, boost sales margins through better customer service, reduce capital locked up in inventory and enhance your competitive advantage.
Demand-sensing tools, for example, can create near-term forecasts that show current market trends and apply those to plan capacity based on your own actual data and not merely simulated datasets. (Full disclosure: My company provides demand-sensing solutions.) Real-time insights, automation techniques, AI and machine learning algorithms can help turn your streams of data into clear decision-making.
Here are four ways you can use demand sensing to create capacity plans:
1. Optimize operating costs: You can consider using real-time demand sensing to help you budget and cut operating costs where you need to so you don’t waste money and resources on contingency.
2. Get accurate fleet positioning: Logistics managers often face the challenge of how to adequately use their transport potential, so you can also use demand sensing to create fleet position plans. Using real-time analytics, you can get a clear picture of what kind of fleet would be most useful in the coming hours, days, weeks or months, based on your data.
3. Manage carriers to their optimum capacity: While demand sensing repositions fleets more accurately, it can also help monitor and manage fleet loads against capacity commitments and reveal existing gaps where daily needs overwhelm the total committed capacity. This helps managers address, solve or avoid potential challenges with carriers that cannot meet load commitments.
4. Absorb demand shocks. Short-term demand sensing capabilities can help logistics companies better respond to immediate demand fluctuations. This gives them the power to streamline capacity and operational plans and save on the day-to-day cash reserves that end up impacting their bottom line.
However, when leveraging this tech, it's important to keep a few best practices in mind, including:
Start small and scale. Avoid the common trap of taking on a major multiyear, all-encompassing digital transformation or industry 4.0 projects with one-off consultants. When aiming to improve your operations and the supply chain, I've found it is better to crawl, walk and then run.
After all, you wouldn't manually service a jet engine at 36,000 feet. The same is true when applying advanced technology to your existing data systems that support your daily business units. Start with a few small pilots with vendors that address specific challenges you are looking to overcome in the near term. Those that are successful with a positive return on investment can then be scaled up across your enterprise to capture greater economies of scale and returns.
Leverage your own people. After all, they're already domain experts who know your business. If you're incorporating demand-sensing tools or other AI solutions, empower them with targeted training on how to leverage your data. That way, they're not crunching numbers like a super-computer but elevating those best AI recommendations for implementation to achieve better business results.
Overcoming capacity-planning challenges has never been more important. With global supply chains becoming more complex, logistics companies need to empower themselves to make quick yet accurate decisions with confidence so they can serve customers — even when supply chains are turned upside down.
3 Ways a Control Tower Can Help You Recover Revenues & Resilience_
by mpo website
Supply chains have never been more exposed to uncertainty and disruption. Businesses are turning to Control Towers to secure the visibility they need to stay better informed, connected, and resilient as revenues drop and many supply chain partnerships become less viable.
However, while Control Towers certainly offer greater efficiency and agility, many practitioners and buyers don’t realize just how much they vary in their breadth and depth.
Here we’ll explore three unexpected ways that Control Towers can offer incredible flexibility and financial returns.
1. Blending Planning & Execution to Boost Order Optimization
The supply chain is a complex ecosystem of diverse parties managing multiple order types, shipments, and inventory in multiple locations against various cost factors. Planning an order requires insight into real-time processes and flows to facilitate the smartest, most cost-effective use of all available resources. The same is true for execution – especially when operations don’t go as planned. Timely access to all options and opportunities minimizes latency, impact, and loss.
Most enterprise systems, such as ERP, WMS and TMS, typically focus on planning or execution, but rarely both. The ideal Control Tower, then, is one that bridges the gap by providing a holistic view of all inventory, in-transit stock, replenishment plans, and all order, shipment, and flow types (inbound, outbound, aftermarket).
Also, data is only as good as what you can do with it. A robust supply chain Control Tower will be configurable and able to apply smart business rules to the information it gathers. To quickly adapt to changes and disruptions, choose a Control Tower that lets you easily and continuously configure operational parameters and constraints. The Control Tower should then leverage that data to plan the most optimal flow paths to fulfill each order, by determining the best partner options, use of resources, and routes.
To streamline the execution of these plans, a digital Control Tower can automate these decisions and then offer real-time status updates to monitor progress at every stage of fulfillment. When exceptions arise, the supply chain Control Tower should offer new and updated intelligence on the best ways to respond, for instance, by reevaluating paths, flows, costs, and available parties.
In-app exceptions management is another highly overlooked, but tremendous way to save on costs. Splitting or consolidating orders as needed with a click of a button can save exponentially on unnecessary expedites among other things.
2. Converging Order & Logistics Management for Greater Flexibility
Control Towers that only cover logistics and transportation limit decision-making. These solutions calculate the cheapest and fastest way to ship an item from a determined location (i.e. a distribution center) to its destination (i.e. to a store). Unfortunately, these are just a few parameters in a far more complex reality.
For comprehensive visibility, a Control Tower must capture a wide range of data (structured and unstructured) from diverse sources (enterprise and network systems, telematics devices, IoT, social media, etc.).
A Control Tower that has real-time insight into all ongoing orders, flows, business network options, and criteria and constraints will factor in the greater supply chain complexity and let businesses know whether it’s more ideal to ship from a different location (let’s say one that has better stock) or even split the order and have it ship from multiple locations.
Logistics and transportation-focused systems tend to limit themselves in only a few modes or order and flow types. An order-centric platform doesn’t impose such formal restrictions, and so can accommodate more complexity and versatility through unlimited mode and partnering possibilities.
3. Uncovering Previously Hidden Costs
Most companies manage supply chain segments and logistics spend separately, often using a variety of static enterprise systems and/or spreadsheets, which are disjointed by nature. When this happens, logistics, procurement, and finance teams end up operating blindly of one another and incur uncontrollable and unmanageable logistics costs.
The right Control Tower can provide extraordinary insight into how companies view and control spend. If you want to get a true cost-to-serve picture, you’ll need a holistic supply chain Control Tower that documents an order’s journey from start to finish in great detail, including every leg, mode, service order, and all tariffs, contracts, and prices encountered.
Through the intelligent blending of order planning and execution, a holistic Control Tower will automatically capture the full breadth and depth of all types of costs – handling, customs, duties, storage, transport, and so on – to arrive at a total landed cost.
Modeling landed costs and tracking these costs on a continuous basis can provide financial returns that were unimaginable otherwise. And, as an added benefit of capturing all cost types, your Control Tower will be able to standardize all invoice processes, like invoice matching. Such digitized and automated process standardization eliminates errors and discrepancies and provides holistic cost visibility and control to your logistics, procurement, and finance teams.
If you manage a complex, global supply chain with high dependency, a large, growing network, and increasing customer service demand, you need a Control Tower that is built to manage supply chain orchestration. A unified platform that converges order and logistics management and spans the end-to-end multi-enterprise business network – beyond transportation – will offer you the greatest levels of flexibility and agility. Because to really boost profits and lower costs, you need technology that will help you partner intelligently and dynamically and in a way that benefits all partnerships and activities simultaneously.
Supply chains are turning to green solutions for the future_
by supplychaindigital website
Climate change has become a constant threat to our world and economy, that businesses are now trying to come up with solutions to help in the mission to become greener. Scope 3 emissions, which are the result of indirect emissions that occur in a company’s value chain, have come into the spotlight as shippers set sustainability goals. The extended supply chain is often the largest contributor to emissions yet the toughest scope to tackle.
A recent 2020 report from CPD explored the state of environmental risks in supply chains and what approaches businesses are taking to mitigate them. It found that just "37 per cent of suppliers are taking action and engaging with their own suppliers, down from 39 per cent in 2019."
CDP also estimated that more than 1,000 companies are now working to reduce scope 3 emissions, and 94 per cent of companies with science-based targets include details on how they'll accomplish it.
FedEx plans to convert its entire parcel pickup and delivery fleet to "zero-emission electric vehicles" by 2040, the carrier announced. FedEx CEO Fred Smith said the decision was based on the increasing economic viability of sustainable solutions and concern about carbon pollution.
"Our customers are increasingly focused on this issue. They want to do business with transportation providers that are environmentally responsible," Smith said. "But we also — as a commercial enterprise — have to produce for our shareowners."
DPDgroup has announced its commitment to deliver 225 of the largest European cities with zero- and low-emission delivery means. By 2025 DPDgroup will reduce its last-mile carbon footprint in the cities targeted, decreasing its CO2 emissions by 89 per cent and pollutants by 80 per cent compared to 2020. In regards to CO2 emissions per parcel, there has been a -14 per cent reduction (vs. 2013) and by 2025 it will be -30 per cent.
From ocean, to air, to road, to rail, carries across the supply chain are investing in green technologies and different ways to help reduce emissions and increase sustainability.
Last year, the International Maritime Organization's sulfur regulations came into force, referred to as IMO 2020, they limited the sulfur emissions from ships to 0.5 per cent mass by mass, down from 3.5 per cent.
Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, a world leader in shipping and logistics, announced earlier this year that he would dedicate six liquefied natural gas (LNG) powered containerships to the U.S. market as part of the Group’s ongoing efforts to improve air quality and drive forward the energy transition of the shipping industry.
The stats that CMA CGM shares on LNG are positive: 99 per cent less in sulfur dioxide, a 91 per cent drop in particulate matter emissions, 92 per cent less nitrogen oxide emissions, and 20 per cent less CO2 than traditional fuels, according to the carrier.
Emissions from aviation are a significant contributor to climate change, and one way to reduce this is by using sustainable aviation fuels.
British Airways’ owner has become the first European airline group to commit to powering 10 per cent of its flights with sustainable jet fuel by 2030. International Airlines Group (IAG) said it will buy a million tonnes of sustainable aviation fuel every year, enabling it to cut its annual carbon emissions by two million tonnes by the end of the decade.
The company also announced it is the world’s first airline group to extend its net-zero commitment to its supply chain.
Route optimisation is the process of determining the most cost-efficient route and can be very beneficial to trucking and delivery companies. It can help with providing reliable ETAs and improve customer satisfaction. Well-planned routes mean drivers spend less time driving, which reduces fuel costs and wear and tear on vehicles and can also increase both times on-site and the number of stops a driver can make in a day. Optimal route management can help improve operational costs too.
The trucking industry is aware that the supply chain is moving towards a more sustainable future, which means alternatives for diesel trucks will come into play. Battery-electric vehicles, fuel-cell-electric vehicles, and vehicles that run on renewable fuels are perhaps the most talked-about alternatives.
Long-distance trains could run on battery power for the first time in the UK, Hitachi Rail announced.
The company said Great Western Railway services between London Paddington and Penzance, Cornwall, could be powered by a combination of batteries, electricity, and diesel. Using battery power at the route's non-electrified stations will reduce fuel consumption by more than 20 per cent, improve air quality and reduce noise levels.
Testing is expected to begin in 2022 and Hitachi Rail hopes a full-battery powered intercity train could be developed by the late 2040s.
Data will be key for stronger supply chains in 2021_
by supplychaindigital website
Barclaycard Payments' Anna Porra shares insight on how leveraging data analytics can help businesses avoid pitfalls in the procurement payments process.
Corporations of all sizes rely on suppliers to provide specialist products and services. 2020 was a year of huge change, with many smaller businesses either reducing trading or having to stop production at times due to restrictions throughout the pandemic.
To ensure business continuity, many companies have had to rapidly rethink their supply chains and how they source different products and services. As we look to the rest of 2021, one way businesses can get ahead is by understanding the importance of effective data analytics in improving the resilience of their supply chain and, ultimately, the profitability of their business.
Modern data analytics platforms can provide procurement departments with a comprehensive picture of their supply chain, helping them understand who their suppliers are; where they are located; how important are they to the business; how at risk they are and, most importantly, what the business can do to help and secure them within their supply chain.
"Insufficient data and clunky supplier payments processes mean that businesses of all sizes are losing money and putting their supply chains at risk"
Data analytics can help improve businesses’ payments processes, which can play a pivotal role in the survival of many smaller suppliers. Even before the pandemic, the FSB estimated that 50,000 small firms went out of business each year because of late payments. Further research also suggests 62% of small businesses have experienced an increase in late payments as a result of Covid-19, meaning many more are feeling the pinch. Paying suppliers on time and with their preferred method of payment, can improve working practices and allow businesses to take advantage of any savings available.
At Barclaycard Payments we have a service that combines accounts payable data points with third-party data , to help customers develop the right payment solutions for different suppliers – thanks to proprietary logic and algorithms, and an automated decision engine.
Barclaycard Payment Intelligence (BPI) helps businesses catalogue their suppliers based on the number and value of transactions as well as their size, location and industry, and whether or not early payment is likely to generate savings. For companies with thousands of suppliers on their books – big and small – this can offer a significant time and cost saving for key decision makers.
Insufficient data and clunky supplier payments processes mean that businesses of all sizes are losing money and putting their supply chains at risk. By embracing the latest technology and data analytics, companies can maintain vital supplier relationships, futureproof their operations and ultimately support smaller businesses through difficult times.