Tag Archives: Business

Supply Chain Complexity and Risk Management

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As part of the Supply Chain Management: Beyond the Horizon research project, faculty and staff from the Eli Broad College of Business at Michigan State University conducted in-depth interviews with a number of organizations to gain insights into the development and implementation of various supply chain strategies, practices, and processes.

The focus was intentionally on the future and on identifying what challenges are driving supply chain decisions in the current environment. The following report summarizes key findings from our investigation of supply chain complexity and risk management obtained during our visit to VF Corporation.

BACKGROUND

VF Corporation is a global branded apparel company that focuses on lifestyle clothing, footwear, and accessories. Since its inception in 1899 as a glove and mitten manufacturer, the firm has grown, diversified, and reinvented itself multiple times. Today, its 30 brands are organized into five coalitions or loose confederations that include outdoor and action sports, jeanswear, imagewear, sportswear, and contemporary brands. The firm has approximately 64,000 employees, sales of $12.4 billion (2015), and a consistent track record of annual sales and earnings growth. The firm is highly diversified across brands, products, distribution channels, and geographies, which provides a strong competitive advantage relative to single- brand competitors.

Because of its focus on lifestyle brands, the firm must remain focused on its consumers and their evolving behaviors and preferences. The firm has four key components in its business strategy:

  1. Lead in innovation (drive new products and new technologies to support evolving consumer needs and tastes)
  2. Connect with consumers (engage consumers in new and meaningful ways)
  3. Serve consumers directly (reach consumers across multiple channels, wherever and whenever they want)
  4. Expand geographically (take advantage of scale to reduce risk and drive competitive advantage)

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Building a Digital Supply Chain Ready for the Future

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With the options that digital technologies provide to develop new business models and new strategies, companies that integrate digital technologies into their supply chain can quickly improve service levels while cutting costs up to 30%.

Complaints from frustrated customers were mounting at a major US retailer.
More than 20% said they could not find the company’s branded products in shops because items were out of stock.

The problem was that efforts to improve service disrupted the company’s low-cost distribution model.

It had the right infrastructure but lacked the digital tools necessary to increase supply chain reliability.

Moving quickly, the leadership team invested in digital tools to obtain real-time data, shorten replenishment cycle times, optimize deliveries and predict future demand.

As data streamed in from stores the minute shoppers purchased goods, the company rapidly restocked hot-selling items to capture sales that it previously had lost.

The shift cut retail cycle times by 20%, to four days, generating a 0.5% increase in sales (see Figure 1 below).

And that was just the first wave of improvement.

Over the next 24 months, the company aims to reduce the time needed to fill store orders to two days, for a 60% total reduction in retail cycle time.

Companies that integrate digital technologies into their supply chain can quickly improve service levels while cutting costs up to 30%.

Just as important are the options that digital technologies provide to develop new business models and new strategies.

For instance, leading-edge companies such as Adidas are deploying 3D printing to move some production closer to customers, offering greater product customization and shorter lead times.

Read more at Building a Digital Supply Chain Ready for the Future

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Blue Print for Success

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Falling demand, tight credit, and unprecedented economic challenges are forcing businesses to look for tools and means of reducing cost, increasing productivity, maintain-even increase customer base, avoiding costly initiatives, and improve quality. The essence of this initiative, Supply Chain Institute, is to address these problems by providing analytics, modeling capability, and execution methods to assist with the resolving of the real life business problems.

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Announcement

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Greetings All,

In response to industry needs in utilization of captured data and through visibility functions, we will start webinars on creating value by using capturing of selected array of data as BI. This is combined with risk and performance analysis to accommodate for optimality in Operational and Strategic optimality.

 

Stay tuned,

Dr. Javad Seyed

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A Case Study on Leveraging Supply Chain Risk Management Solutions to Drive Revenue for a Leading Consumer Packaged Goods Firm

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SpendEdge, a global procurement intelligence advisory firm, has announced the release of their new ‘supply chain risk management study on the consumer packaged goods industry’. A well-known consumer packaged goods company with a considerable number of manufacturing units spread across economies was facing difficulties in identifying the potential opportunities in the market. The CPG sector client wanted to leverage the use of supply chain risk management solutions to achieve a more robust supply chain network. The consumer packaged goods client was also looking at devising an effective risk treatment plan including measures to protect the supply chain.

According to the procurement analysts at SpendEdge, “The CPG industry acts as a foundation for the modern consumer economy as it drives not only huge amounts of money into other businesses like retail and advertising but also generates a massive portion of the gross domestic profits (GDP) for countries across the globe.”

In the consumer packaged goods industry, leading firms are looking at leveraging the use of supply chain risk management solutions, as it helps them integrate several previous or ongoing initiatives, including those for business continuity and supply-chain security. Our supply chain risk management solutions assist clients in the consumer packaged goods market space to align their risk management strategies with supply chain risk exposure.

The supply chain risk management solutions offered by the experts at SpendEdge helped the consumer packaged goods client to monitor the complete process, starting from risk analysis and risk evaluation through risk management and right up to residual risk control. This helped the CPG sector client to achieve productivity and avoid sales losses.

Read more at A Case Study on Leveraging Supply Chain Risk Management Solutions to Drive Revenue for a Leading Consumer Packaged Goods Firm

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Cloud Database for Dummies (Free E-Book)

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Cloud Database for Dummies

Building a Database in the Cloud? E-Book Explains How.

It’s free for download as long as you have a free Oracle account.

Clear and concise, practical, filled with time-saving tips—the reviews are in on Building a Database Cloud for Dummies.

This quick-reference guide, organized into six short chapters and supplemented with helpful illustrations, provides a clear overview of the cloud and step-by-step instructions on deploying database as a service. Download the complimentary e-book today and learn how to:

  • Build a vision and business case for the cloud
  • Operate and deploy a database in the private cloud
  • Maximize success, with a list of the top 10 things to consider when starting

Cloud Database

Cloud database allow businesses to drive down costs while increasing business agility and IT performance. See for yourself how to save money, simplify management, and improve resource efficiency with a database cloud.

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How to Measure Supply Chain Performance

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The appropriate metrics to manage and measure the success of a company’s operation vary significantly by industry, by individual company, and by the scale of the business. What does not vary, however, is the universal need of all companies to employ a well-structured, hierarchical framework to organize and manage their metrics.

The absence of a cohesive framework to house metrics greatly increases the likelihood that a company’s performance measurement system (PMS) will provide inadequate management support, and that resources will be wasted developing duplicative, unaligned and even conflicting metrics.

There are a number of well-known models and frameworks for operations, logistics and supply chain management. Two of the most prominent are the SCOR model and the Balanced Scorecard, and the interested reader is referred to these.

Figure 1 depicts an integrated hierarchical supply chain performance measurement system. The framework contains three levels (the strategic, tactical and operational), and within each level, it has both external and internal measures. In this PMS framework, it is the scale of an operation or activity that a particular metric monitors which determines its place in the hierarchy.

Figure 2 provides additional insight on how this hierarchical PMS framework works, displaying sample external and internal metrics for a distribution organization at each level of the hierarchy. The external metrics measure outputs and/or services that flow across the supply chain and evaluate some aspect of serving the customer. The internal metrics have an “inward” focus; and as shown in Figure 2, they evaluate how efficiently the overall distribution organization and each of its sub-functions operates.

Read more at How to Measure Supply Chain Performance

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Risk, BI, Performance Management in the Context of Supply and Demand Chain Management

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Risk, BI, Performance Management

Greetings;Due to overwhelming demand from colleagues, customers, and market, we will start a new lecture series on Risk, BI, Performance Management, in the context of Supply and Demand Chain. These articles will appear as lecture series as well as the Latest News on this web site. Your participation and contribution is very welcomed and appreciated. We will try to address the said topics from Analytical Approach as well as Management points of view. I look forward to your input, contribution, and comments.Best Regards,Javad Seyed, Ph.D.javad@supplychaininstitute.com

Making sure it’s business as usual, whatever the weather

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The UK was recently subjected to an extreme cold spell that saw widespread disruption across the UK. Dozens of rail services and flights were delayed or cancelled, thousands of schools were closed, a raft of homes were left without power in certain parts of the country and many people struggled to get to work in the snowy and icy conditions.

This short spell of disruption would have come at a cost to the UK economy, but in reality we should be thankful we’re not subjected to the extremes of weather that can impact other parts of the world. Anyone remember the scenes we saw on our TVs in the wake of Hurricane Irma in the Caribbean and Florida? In addition to the devastation caused to thousands of families’ homes, businesses were left in turmoil too. Florida, for example saw the price of its diesel soar and shipping and trucking capacity was severely limited in the region. It is estimated that the economic cost of the storm which has caused significant damage to homes, businesses and crops could be as much as £227bn.

The knock on effect of the storm’s impact is still being felt, especially for any businesses with suppliers based in the storm-damaged regions. This event highlights the increasing risks businesses face when they have a supply base in a region that could be affected by adverse weather or other environmental factors such as earthquakes, or volcanic eruptions.

No matter where in the world your critical supply base is located it is essential that businesses ask their suppliers the right questions from the start of their relationship. Even with non-business critical purchasing activity, adopting a proactive approach to on-boarding/supplier evaluation and supplier contracting means that you can assess your suppliers and ask questions about disaster recovery, insurances, and best practice around handling large scale environmental events from the outset. Sounds obvious, but it’s very easy to overlook this line of questioning, especially if purchasing is being done on a decentralised basis.

Read more at Making sure it’s business as usual, whatever the weather

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Four Steps to Building a Global Chain Risk Management Platform

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Be proactive – and significantly reduce global supply chain risks, discover the 4 steps to building a global supply chain risk management platform in a white paper from Avetta.

A global marketplace presents a complex set of challenges, especially when attempting to maintain a safe and sustainable working environment for your employees, contractors, and suppliers.

A minor detail, if left unresolved on the front end, can explode into a financial or operational disaster.

But the implementation of a world-class risk mitigation solution can save time, money, and even lives.

It’s critical to have the plans, resources, and technology in place that verify credentials, measure financial stability, and encourage sustainable business practices.

A proven supply chain risk management partner can ensure that your program is configured efficiently, intuitively, and effectively.

Save your business from negative impacts to its revenue and reputation by taking the right steps to minimize global supply chain risks.

In this white paper from Avetta, you’ll learn the keys to successfully managing your supply chain, protecting it against avoidable situations, and recovering from unforeseen disasters.

Find out how to better equip your business to prevent:

  1. Incidents caused by under-qualified or untrustworthy contractors or suppliers
  2. Injury to employees, contractors, suppliers – and the obligation of medical expenses associated with them
  3. Direct costs such as damaged goods and materials, machinery repair, and insurance deductibles
  4. Indirect costs including revenue loss from brand damage, employee and supplier down time, production delays, and fines

Read more at Four Steps to Building a Global Chain Risk Management Platform

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