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21st Century Supply Chain

1,221 posts
by Dr. Madhav Durbha

LogiPharma 18


In early April I attended the LogiPharma Europe 2018 conference in Montreux, Switzerland, an event that attracted more than 800 attendees, including practitioners and executives from pharma and medical device industries, along with software vendors and many service providers.


Here are some key takeaways from a content-rich, fun and exciting pharma supply chain conference.


1. Patient-centric networks are reshaping pharma supply chains

In a thought provoking presentation, Philippe Francois, global head of supply chain for Novartis, observed that while pharma companies have been talking about patient centricity for years, a typical pharma supply chain links the Active Pharma Ingredient (API) to manufacturing, distribution, retail/pharmacy, and finally to patient—with the patient always at the end of the chain!


Francois talked about how cell and gene therapies are personalizing medicine, putting individual patients at the center of the supply network. Francois discussed the specific example of CAR-T cell therapy for certain types of cancers wherein immune cells harvested from a patient are reengineered at a production facility, and are then reinjected into the patient so the reprogrammed cells fight cancer. In this instance, the supply chain begins and ends with a specific patient, providing an extreme example of personalized medicine. Given that the cells involved are living, they have very short lifespans and must be shipped in tightly managed, cryogenic conditions in a timely manner. From the moment the cells are harvested, downstream visibility is extremely important with no margin of error.


Interestingly, just a day before the LogiPharma conference, Novartis announced the acquisition of AveXis, a gene therapy company for US$8.7B. While this announcement brings some very exciting opportunities for Novartis, it ups the ante in terms of the required supply chain competence. Francois said such advances in personalized medicine are forcing pharma companies to think differently. Also, reimbursements in such treatments are linked to outcomes, truly placing the patient at the center.


2. Lessons from Amazon for pharma companies in enabling patient centricity

Philippe Hemard, former VP of Logistics Europe for Amazon, discussed what pharma companies need to learn from Amazon:


  1. As life expectancy grows, there will be more patients with mobility issues. Delivering the product in the most convenient way—when and where they need it—will be a differentiator.
  2. Patients will need to enjoy the benefits of same-day delivery, something Amazon has clearly demonstrated is feasible in the non-pharma space.
  3. Excellence in operations driven by end-to-end visibility into inventory levels will be important. Amazon manages millions of SKUs with such visibility, which is something pharma distribution networks must quickly aspire to.
  4. Bring cost and affordability to patients by reducing the costs of delivery.

Of course, all of this is easier said than done. Amazon has the scale to manage the distribution in a cost-effective manner. It will be interesting to see how pharma rises to the challenge, especially with Amazon’s entry into the space looming on the horizon.


3. Concurrent planning breaking down silos

In a very compelling presentation, Brian Thornley of Merck spoke of his organization’s journey from siloed, node-to-node planning to concurrent planning. To highlight his point, Thornley shared this example: The API was manufactured in China, granulation was performed in Puerto Rico, and then packaging was performed in Netherlands. In his previous reality, planners were very focused on these individual steps but not for the end-to-end flow.


Now, with concurrent planning, planners not only have end-to-end visibility of the product flow plans but also can simulate a variety of scenarios. For example, what if sales were to increase by 20 percent, or what if a piece of equipment goes offline? Do I have the system-wide ability to support the demand in such situation and still manage my assets and inventory effectively? Planners can now quickly assess impacts and evaluate options based on such scenarios.


4. Taming supply chain planning complexity through automation

Niall Kennedy of Gilead Sciences spoke about how an integrated supply chain transformation program is helping his company keep pace with the growth in the business. Some of Gilead’s drugs contain up to four APIs, with each API having several variants. This results in significant planning complexity that must consider regulatory compliance regarding where the lots are made and where the lots are eligible to be sold based on genealogy.


Planners once carried the burden of this complexity in their heads as previous planning systems could not account for regulatory constraints. This resulted in plans that were not feasible to execute. Today, Gilead leverages Kinaxis RapidResponse® to integrate its regulatory database with supply chain planning. With this, the full level pegging of demands to the supply in various stages in their master production schedule honors regulatory rules, making the plans realistic and feasible. This makes for a powerful pharmaceutical supply chain management story!


5. Pharma supply chain projects are moving from linear to agile

Several presenters commented that their organizations are moving away from linear-style project management to a culture of experimentation. Hussain Mooraj of Deloitte said it well with the “think big, start small, scale fast” approach that he sees more and more companies taking. This observation matches what I am seeing in pharma companies and in other industries I work with. The days of massive implementations with questionable payoff are numbered. We’re tackling more and more projects in smaller chunks, with pay-as-you-go models. Clould-based offerings are enabling such consumption models. The rise of cloud-based technologies is evidenced by the number of software vendors, 3PL and 4PL companies in attendance at the event who were there speaking to the virtues of cloud.


6. Smart devices enable digital supply chains

Simon Orchard of Pfizer spoke of the pilot projects his team is working on in the field of GPS-enabled temperature sensing to monitor cold chain logistics. Orchard also discussed a pilot that leverages drones for inventory cycle counting in warehouses. Instead of conducting labor intensive cycle counts once or twice a year, Orchard described how Pfizer uses drones to perform cycle counts overnight to significantly improve inventory accuracy and reduce labor costs. Several vendors at the event showcased a variety of IoT devices, most of which provided temperature and location monitoring and logging such information in the cloud.


Of course, a pharma supply chain conference is not complete without talking about Blockchain. However, it is clear the presenters on the topic had more questions than answers. Supply chains for personalized medicine need to operate with 100 percent precision, and in my view Blockchain could very well prove to be useful in such contexts. The high revenue opportunity associated with personalized medicine (with therapies costing hundreds of thousands of dollars!) can help justify the investment in the Blockchain technology.


This pharma supply chain conference was both energizing and thought provoking. LogiPharma Europe 2018 was a great opportunity to reconnect with several customers and business partners, while establishing new connections, which will no doubt prove long lasting.


Automotive industry spotlight


Originally posted by Dr. Madhav Durbha at

by Alexa Cheater

The solution to supply chain issues in the automotive industry

Don’t put your supply chain profits and productivity at risk. New technologies, emerging and shifting markets, disconnected regional processes, increasing volumes and added customer demands—these are just a few of the speed bumps automotive supply chains are facing. And not addressing all that mounting complexity could be putting your supply chain profits and productivity at risk.


But shining the headlights on these potential issues isn’t enough to solve them. To keep your automotive supply chain on the road to success, you’ll need to realign, consolidate and coordinate supply chain planning across all tiers and regions in your network, including suppliers. And that means connecting data, processes and people into a single supply chain planning platform—one that utilizes concurrent planning.


No more wasting time chasing down disparate data, struggling to harmonize regional and global processes or trying to get your worldwide workforce to collaborate. With concurrent planning, you can plan expected performance, monitor progress and respond when changes happen. That will help drive down costs, improve efficiency and better prepare you to stay competitive in an increasingly demanding landscape.


By facing complexity head-on, you can achieve:


  • Higher customer satisfaction levels – With improved demand forecasting, you’ll be better equipped to understand which cars with which options customers in each region want.
  • Lower inventory costs – Better supply and demand alignment means you’ll have less capital tied up in inventory, since you won’t be holding the wrong parts in the wrong locations.
  • Greater revenue and market share – With properly balanced supply and demand, you’ll have enough of the right products to meet customer requests—something your competitors could still be struggling with if they haven’t overcome complexity.

Interested in learning more about overcoming complexity in your automotive supply chain?


Download our industry spotlight to see how concurrent planning can help you steer clear of speed bumps and fuel your supply chain profits.


Download Automotive Industry Spotlight


The post Is global complexity driving your automotive supply chain to the edge? appeared first on The 21st Century Supply Chain.


Automotive industry spotlight


Originally posted by Alexa Cheater at

by Bill DuBois

Top 10 signs you’ve been working in supply chain too long


Boomers, millennial leadership and supply chain management jokes. Is it time for the older generation to move on?

It’s no secret supply chain talent has been top of mind for many executives for some time. Research firm Gartner even has it listed as a hot topic for its Supply Chain Executive Conference in Phoenix, May 14–17.


There are a couple of reasons for this. The first is the aging population. A number of reports from the American Association of Retired Persons (AARP) and Pew Research Center state 10,000 baby boomers are retiring every day. It’s easy to speculate there would be some supply chain talent retiring. The question is: How do you replace the knowledge gap created by those retirements?


Secondly, there are more millennials entering the supply chain workforce. While millennials are often given a bad rap for being hypersensitive, they certainly bring another level of leadership to supply chain management.


Is it time for us boomers to make way for millennial leadership? If you have any doubts, check out this list of the top 10 signs you’ve been in supply chain too long.


Top 10 signs you’ve been in supply chain too long:

  1. The mission statement at your first inventory management job was, “If they can build it, we can store it.”
  2. When you first started your career, your supply chain started at the front door and ended at the back door.
  3. You know all your planners’ names… and the names of their children… and grandchildren.
  4. The early days of capacity planning consisted of calling Joe in operations to see if his team could produce a few more units.
  5. The young gun on your planning team only has 15 years of experience.
  6. Your first mentor was Henry Ford.
  7. Globalization used to mean ordering Chinese for the office lunch.
  8. When you asked your demand planner about the forecast, he or she would give you the chance of rain.
  9. You have a new boss—a millennial—who also happens to be best friends with your children.
  10. You don’t find this or any other supply chain top 10 list amusing.

Supply chain management jokes aside, we hope to see all supply chain millennials and millennials-at-heart at the Kinaxis booth at the Gartner Executive Supply Chain Conference.


Stop by and say hello!


The post Top 10 signs you’ve been working in supply chain too long appeared first on The 21st Century Supply Chain.


Automotive industry spotlight


Originally posted by Bill DuBois at

by Alexa Cheater

Artificial Intelligence in Supply Chain Management – KinaxisFaster, smarter, more profitable supply chain decisions

Transitioning from hype to reality, artificial intelligence (AI) is gaining momentum across industries thanks to an explosion in computing power and storage, the emergence of IoT (Internet of Things) and big data, and algorithmic advances. While there have been numerous examples of how AI can boost profits in supply chain execution—most notably in the form of autonomous vehicles and smart robotics—the benefits related to supply chain planning have largely been ignored.


But that’s starting to change as future-focused executives see the potential to improve profitability and productivity by making faster, smarter supply chain planning decisions. The first step in achieving those benefits is understanding AI and the other technologies associated with it, and where they can help improve your supply chain planning initiatives.


Emerging technologies and how they relate to supply chain planning

People often use AI as a catch-all term for any kind of technology that involves smart machines. And while many of those fields do fall under the AI umbrella, it’s still important to know some of the key differences between the terminology. Here are three simple definitions of AI and related technologies, plus how they apply to supply chain planning.


1. Artificial intelligence

The ability of a machine to perform human-like functions such as perceiving, reasoning, learning, interacting with the environment, problem solving and exercising creativity to form plans, make decisions and achieve goals.


Use in supply chain planning:


  • Amplify the value of your existing processes and people with machine-assisted planning, which can help you bridge the knowledge gap between experienced and inexperienced planners, and gain real-time recommendations based on historical and current data analysis.
  • Improve your supply chain visibility and risk insight by using AI to track and predict possible supply chain disruptions based on inputs and correlations across multiple data sources, including weather forecasts, news and even social media.

2. Machine learning

A subset of AI, machine learning is a method of data analysis where machines use algorithms to detect patterns, learn to make predictions and make recommendations by finding hidden insights in your data without being explicitly programmed where to look.


Use in supply chain planning:


  • Unlock new sources of revenue savings by implementing a self-healing supply chain that can continuously observe, monitor and correct out-of-tolerance lead times for all related products based on historical data and slope.
  • Increase customer service levels with more accurate demand behavior for new products by using algorithms based on early-sell signals to optimize inventory levels and replenishment plans.

3. Deep learning

A subset of machine learning, deep learning leverages neural networks to understand vast amounts of unstructured or unlabeled data in either a supervised, semi-supervised or unsupervised way, drawing conclusions, learning if those conclusions are correct and then applying that learning to new data sets.


Use in supply chain planning:


  • Save time and money with an always-on automated planning agent that automatically handles low impact exceptions as they arise, delivers detailed reports on its observations and the corrective actions it took, and send alerts to the right people when larger issues arise.

Companies are making big strides in developing and deploying real, practical applications of AI in supply chain management and planning. Before jumping on the bandwagon, ensure you’re not getting caught up in the hype and truly understand what you’re signing on for, because while AI is helping pioneer a new future, it still has its limitations.


How are you exploring AI in supply chain planning? Let us know in the comments section.


The post An executive’s guide to AI in supply chain management appeared first on The 21st Century Supply Chain.


Avaya digital transformation - Kinaxis


Originally posted by Alexa Cheater at

by Bill DuBois

Intelligence is the ability to adapt to changeOn March 14, 2018, the world lost an unbelievable talent in Stephen Hawking. Tributes continue to pour in around the globe for a man who gave so much to science, all while fighting motor neuron disease since the age of 21. As astronaut Chris Hadfield commented on Twitter, “Genius is so fine and rare.”


Fortunately, for us, Hawking’s genius will live forever as his words continue to inspire generations. He had many great quotes that motivate anyone regardless of profession. Like many others, I try my best to apply Hawking’s wisdom to my work. If you’re reading this, that work is likely improving supply chain planning and our lives in general. The two often intertwine, which makes the wisdom even more valuable.


With that in mind, I thought I’d pass along some of my favorite Stephen Hawking quotes and tie them to supply chain planning. Here are my top five favorite quotes from the brilliant mind of Stephen Hawking:


1. “Quiet people have the loudest minds.”

How often have you been in a meeting or on an implementation project with one silent person? If this quote has taught me anything, it’s that everyone has a voice. In supply chain planning, that’s especially true for the people doing the planning. The most successful projects I’ve witnessed are those where everyone has a voice. Sometimes people just want to get on with planning, but when they take the time to open up about current challenges, solutions start to become more obvious.


2. “Keeping an active mind has been vital to my survival, as has been maintaining a sense of humor.”

From a supply chain perspective, when I hear the word survival, my first thoughts are about managing unexpected change. In particular, change caused by natural disasters such as the tsunamis, hurricanes and earthquakes that have occurred in recent years. Ultimately, it’s the active minds of the supply chain communities who look for the solutions to these problems, as well as continuing education that leads to significant process improvements. It’s not uncommon for companies to invest in centers of excellence to learn and share best practices. I admire how Hawking could maintain a sense of humor in spite of his disability. You can’t deny that he loved what he did because his work made him so happy. He didn’t have time to complain, which brings me to the next quote.


3. “It’s a waste of time to be angry about my disability. One has to get on with life, and I haven’t done badly. People won’t have time for you if you are always angry or complaining.”

Time is the most precious thing we have. It’s so valuable you can’t even put a price tag on it. You’ll give it freely to people you love and find interesting. However, start wasting someone’s time and see how fast they disengage. When solving supply chain planning problems, complaints don’t help. It would be easy to complain about those unexpected changes and make excuses for expedites, excess inventories, and missed deliveries. Who could blame you after facing supply chain challenges, such as natural disasters?


True supply chain leaders replace excuses with lessons learned. They don’t get angry, they get motivated to do better the next time and improve supply chain planning so that managing unexpected change becomes as easy as a pit crew changing a tire for a Formula One car. People are interested in solutions, and motivation— unlike anger and complaints—is contagious.


4. “Intelligence is the ability to adapt to change.”

Supply chain planners have become masters of change. Explore any supply chain blog for a list of challenges planners face and the extent that change in the supply chain has intensified. Decades ago, successful supply chain leaders realized that they would have to get good at change. Maybe it’s supply chain intelligence, wisdom or—as mentioned in the second quote—survival. Whatever you call it, adapting to change is smart and can be profitable.


5. “I have no idea what my IQ is. People who boast about their IQ are losers.”

It’s difficult to define a human being by a number. Education, experience, hardship, relationships— among so many other things—make a person who they are. It’s that mix that makes a person a valuable team member, not just an IQ number. When working with other companies on their supply chain challenges, not once did someone ask me my IQ. However, they did want to hear about other companies and the experiences our deployment teams brought to the table. If it’s good enough for Stephen Hawking not to know his IQ, it’s good enough for me.


Do you have other favorite Stephen Hawking quotes? Let us know in the comments.


The post A brilliant mind: 5 Stephen Hawking quotes appeared first on The 21st Century Supply Chain.


Avaya digital transformation - Kinaxis


Originally posted by Bill DuBois at

by Ilyas Kucukcay

Space: The final logistics and supply chain management frontierRecent advancements in the space launch market may indicate an increased need for logistics and supply chain management in outer space operations. Humankind’s ongoing curiosity about space has countries competing to prove they have not only the technology, but also the resources and collective knowledge to go beyond our imagination.


Accessing what’s beyond our globe has become an accepted source of socio-political promotion. It’s an indication of a society that can use advanced supply chain technology to achieve the best, and to find and harvest the undiscovered.


The space industry was born from military-related needs during and after World War II, and evolved into a commercially beneficial industry for governments and accredited companies all around the world. Today’s government-based space agencies collaborate to advance the science, technology and services needed to support their programs. In parallel, privately held and publicly traded companies like SpaceX, Arianespace, Orbital Sciences and Sierra Nevada Corporation boost the number of manufacturing options for space-related programs while contributing to the innovation of space and rocket technology.


SpaceX recently launched the revolutionary Falcon Heavy rocket, an internally funded program that’s the most powerful operational rocket in history. The achievement proves to the world that components can be successfully re-used to launch and lift relatively bigger supplies into outer space, underscoring the importance of streamlining multi-purpose inbound and outbound delivery operations in the near future.


Improvements and innovations like Falcon Heavy are also a clear indication that logistics and supply chain management will become that much more important for the space industry in the following ways:


Supply and Logistics of Materials


This is the material that will be used for routine activities and operations, from the supply of food to the staff who’ll operate the missions to the re-usable technology that will allow humans to travel and work in space. Also included are critical materials such as fuel needed to support renewable energy sources within the spacecraft, oxygen to sustain life and spare parts that may be needed during the mission.


Space Logistics and Supply Chain


Space-related operations are projected to form humankind’s largest supply chain network. This network will help deliver humans and technology to outer space with the lowest possible operational cost and risk. In the long run, the supply chain will help make space exploration sustainable, giving us the ability to harvest resources from other planets and deliver them to earth to provide new sources of raw material and enable various industries. Managing the supply chain and logistics in space will not be easy and is still speculative on many levels.


However, many organizations have already started working on a variety of space-earth supply chain technology concepts. For example, MIT’s Interplanetary Supply Chain Management and Logistics Architectures (IPSCM&LA) project is funded to “develop an integrated capability for guiding the development of the interplanetary supply chain that will be required to enable sustainable space exploration of the Earth-Moon-Mars system and beyond.”


Space exploration is no longer a competition between superpowers. In addition to NASA and Roscosmos, other players like China Aerospace Industry Corporation (CASC), Indian Space Research Organisation (ISRO) and European Space Agency (ESA) are planning to expand their space operations to increase efficiency, while independent companies like SpaceX and Arianespace provide cost-efficient launch and delivery programs with re-usable technologies.


The field of logistics and supply chain management is key to sustainable space exploration. Governments and private and public organizations boost the level of competition, providing new sources of technology, scientific research and human capital, and create new supply chains and logistics to efficiently deliver the material for these initiatives to succeed.


The future holds exciting and innovative discoveries in space exploration. While it’s exciting to witness early improvements in the industry, a diverse network of players will add value to the mix and push innovations in aerospace supply chain management and supply chain technology even further.


I would love to hear your ideas about how companies like SpaceX and Arianespace will change the nature of supply chain management and logistics. Looking forward to your comments!


The post Space: The final logistics and supply chain management frontier appeared first on The 21st Century Supply Chain.


Avaya digital transformation - Kinaxis


Originally posted by Ilyas Kucukcay at

by Alexa Cheater

Digital Supply Chain Strategy: Challenges and Next Steps – KinaxisGoing digital has become top of mind for most supply chain leaders these days. But finding success through digital transformation is still an elusive venture. According to recent research by the Korn Ferry Institute, all 100 senior supply chain executives the firm surveyed said digital supply chains have the potential to revolutionize businesses. Seventy-four percent admitted they still have a long way to go before that becomes reality. So, what’s standing in their way (and possibly yours as well)?


Lack of a clear digital supply chain strategy

Nearly half of respondents noted that while they have started on digitization, their strategy only considers the impact on the business, not how to implement digital in the supply chain. This could be due in part to lack of engagement at the executive and board level.


“The missing capability is understanding of supply chain at the board level. Supply chain is seen as cost down, whereas we should see it as a new revenue model generator. Everything comes back to the leadership challenge; why are we failing to get the right leadership at the top?” called out Janet Godsell, University of Warwick’s professor of operations and supply chain strategy at Warwick Manufacturing Group, in the report.


“UK boards are dominated by commercial and financial backgrounds, and even if you change the gender and ethnic mix, this does not overcome every angle of the lack of diversity. fficers are a relatively new addition to the executive board, but are not usually on the main board at the top table.”


But a lack of a clear digital strategy isn’t the only barrier to success.


Limited availability of digital talent

Just over half of survey participants stated they have a formal leader in place for their supply chain digitization movement, with many feeling top digital talent is hard to find and attract. As Korn Ferry points out, Generation Y gets bored easily, and keeping them engaged at your company adds to the challenge.


The consensus from the survey results is that hiring talent with the necessary skills is the preferred way to build and develop digital capabilities in the supply chain, with internal training coming in second. However, the survey also notes a lack of financial commitment to develop those skills internally, with two out of three executives allocating less than 10 percent of their learning and development budget to digitization.


Those with clear digital leaders in place and a plan to attract new talent or develop existing resources are ahead of the pack. A staggering number—three out of four respondents—said they haven’t formally assessed the digitization readiness of their existing supply chain employees, and roughly half have no plans to do so.


Next steps toward digital supply chain success

Supply chains have transformed over the past decade, moving front and center into a strategic role within organizations. But that lack of representation at the executive and board levels is preventing the supply chain’s rise to digital transformation.


Another stumbling block is the mentality that going digital means just slapping digital capabilities onto traditional supply chains, which results in hybrid models and added complexity.


As Korn Ferry puts it, “Even companies that embrace the value of an effective and sufficient supply chain often stick with incremental changes rather than choosing a high-risk/high-reward transformation towards a truly integrated, re-invented supply chain whose DNA is fundamentally digital.”


Is your organization’s supply chain truly ready to go digital? Let us know in the comments area below.


The post What’s keeping you from realizing digital supply chain success? appeared first on The 21st Century Supply Chain.


Avaya digital transformation - Kinaxis


Originally posted by Alexa Cheater at

by Alexa Cheater

Avaya: A supply chain management case study

Driving Avaya's digital transformationTrust in the transformation. That’s what high-tech giant Avaya had to do when the company decided to radically change up how it manages its supply chain. Going from a self-proclaimed worst-in-class supply chain to one of the best in the business was no easy feat, but the rewards were well worth the effort.


“In the beginning, it was tough,” admits Benji Green, Avaya’s Senior Director, Integrated Supply Chain Planning & Operations, in a recent article published by Supply Chain Digital. “12-hour days, hair on fire supply constraints, excess inventory, completely manual processes, imbalanced supplier terms and conditions, poor cash to cash. You name it, it was bad. It was hard to imagine becoming best-in-class at the time.”


Tracking success: Metrics matter

Now Avaya is leading the way, exceeding industry benchmarks in 11 key metrics. The company has reduced supply chain expense by 50% and decreased cash tied up in net inventory by 94%. At the same time, it’s seen a 224% improvement in inventory turns and pushed on-time shipments to a record best 97% on-time.


How did Avaya do it? The answer is time, perseverance and a clear vision to exceed employee and customer expectations while fueling profitable growth. The company also made substantial investments to attract, train and retain top talent, while building a corporate culture that engages those willing to contribute to Avaya’s success.


Avaya also measures and reports on more than 100 metrics, each aligned with the company’s four pillars: customer satisfaction, employee satisfaction, cash-to-cash and supply chain expense. Rigorous tracking of these metrics helps Avaya feel confident it’s on track to realize success.


Technology-driven change drives better outcomes

Changing up its supply chain management technology was also a critical piece to Avaya’s success. The company migrated its business processes onto a single platform—Kinaxis® RapidResponse®. It now uses the cloud-based solution for:


  • Supplier communication
  • Supply planning
  • Demand planning
  • Inventory planning
  • Inbound and outbound logistics planning
  • Procurement spend analysis
  • POS analytics

“We do everything from daily supply assurance and revenue risk to strategic product transitions on RapidResponse,” says Green. “Central to globalization, RapidResponse allowed for extensive automation of non-value added work, standardization of processes across multiple MRP instances, products portfolios, and regional variations. The tool, properly managed, has globalized Avaya’s planning and operations processes and organization and helped deliver dramatic improvements and sustainable performance.”


Find out more about Avaya’s incredible supply chain transformation in Driving Digital Transformation from Supply Chain Digital.


Want to dive even deeper into Avaya’s supply chain transformation? Read Aberdeen Group’s in-depth case study.


The post What does it take to build a best-in-class supply chain? appeared first on The 21st Century Supply Chain.


Avaya digital transformation - Kinaxis


Originally posted by Alexa Cheater at

by Dr. Madhav Durbha

Why IT matters to business success and effective supply chain managementThe coffee shop was buzzing.

I was meeting my longtime friend Gagan, and we managed to find a reasonably quiet corner to settle into for what I anticipated to be a long conversation. He and I went to school together and started our supply chain careers at nearly the same time. I joined a supply chain software company while Gagan joined a large global manufacturer and quickly grew through the ranks to be the vice president of supply chain IT in his company.


Throughout our careers, we continued to meet up whenever our travels crossed paths. Gagan is typically an upbeat and optimistic person, but on this day, something was clearly weighing him down. As it turned out, it was about his job, his sense of ownership, digital transformation and his company’s supply chain. Gagan was reporting to the CIO, and the board of directors recently mandated the company embark on a digital transformation journey. As part of the initiative, Gagan’s CEO brought in a new chief digital officer (CDO) as a peer to the CIO. And that’s when Gagan’s troubles started.


Two sheriffs in town

Almost immediately, the new CDO declared responsibility for all new technology initiatives in the company. Quite naturally, the CIO started digging in his heels, increasing tensions between the two executives. Their differences were eventually settled by the CEO, who decided legacy assets and most back-office systems should be the domain of the CIO. Any newer digital technology portfolios would be cloud-based and mobile, and where appropriate, open source. These would belong to the CDO.


The result? A disgruntled team

Gagan’s team of young analysts continued to support legacy supply chain applications from an established vendor. However, his team grew disgruntled as the CDO took on newer, more interesting projects based on everything from the Internet of things (IoT), to data science, machine learning, advanced analytics and blockchain, to mention a few. Understandably, Gagan’s team started to feel like they were being left behind.


Keeping the lights on

“Agility and flexibility” became the company mantra, leaving Gagan with the overwhelming feeling that his team could not possibly deliver on the promise. After all, the supply chain planning applications his team supported were built on legacy batch-oriented architecture, significantly limiting his team’s ability to mitigate the challenges the company faced, all largely due to the following systemic limitations:


  • Data islands: As the company experienced inorganic growth, diverse technologies were constantly added to the mix, leaving data siloed and blocking end-to-end visibility.
  • Planning in silos, node by node: Finished-goods distribution planning, manufacturing planning and purchase planning were all happening in silos, further adding to the company’s woes.
  • Latency in decision making: While the company’s supply chain planning system ran in batch mode, business ran in real time. When a production line went down or supplies did not arrive when expected, planners resorted to offline excel spreadsheets, resulting in delays that could last hours before contingency plans could be formulated and put in place.
  • IT overload: Because the system was so rigid, enhancements required heavy IT involvement. Predictably, support tickets started piling up, and Gagan’s team was taking heat from the users.

“My team could deliver anything but ‘agility and flexibility,’” said Gagan. “While the CDO got funding for new technologies, funds from our organization were siphoned off to support them. We were accountable for ‘agility and flexibility’ but didn’t have the budget to back it up. Not once did the CDO update us on the projects his team was working on, nor did he ask what we were wrestling with. My boss, the CIO, is completely sidelined. It’s as if my team is being led on horseback into a 21st century battle field with nothing but bows and arrows. We’re getting slaughtered. In fact, my lead architect just left the company.”


I took a sip of my now lukewarm coffee, and pushed the cup aside. Gagan had gained weight. His eyes were sleepless and his face was showing age beyond his years. I worried for him and wondered aloud what he was going to do next.


Fast forward a year and a half

When Gagan was in back in town, we got together for dinner. I couldn’t believe the transformation. He was lean and fit, looked ten years younger and was in high spirits.


Gagan had left his previous company to lead the supply chain IT at another fast-growing company. In many ways, the nature and dynamics of his new company was no different from that of his previous company.


The biggest difference? The new company had invested in a leading-edge supply chain platform, giving new life to the mantra “agility and flexibility.” Here is how the new system supports the business and improves supply chain management:


  • Cloud-based, always-on planning: No longer are batch jobs needed for planning (other than bringing in data at an appropriate cadence and frequency). The system itself was always on, sensing changes and responding rapidly in real time. The solution was Software as a Service (SaaS), eliminating hardware procurement and stack configuration lead time, saving valuable weeks and months.
  • Data harmonization to support inorganic growth: While the company perfected the onboarding process for the new businesses they acquired, the platform’s data harmonization capabilities allowed them to generate an end-to-end view of their supply chain without having to consolidate underlying systems.
  • Simulation capability: During a recent hurricane, several company suppliers went down. Using the new system, supply chain planners quickly simulated recovery plans and locked in alternate supply sources well ahead of their competition. “Agility and flexibility” at its finest.
  • Changing role of IT: The system’s self-service capabilities gave power users the ability to configure reports and make changes to models as the business evolved, freeing up Gagan’s team to focus on newer, best-of-breed technologies to augment the organization’s capabilities. The role of IT significantly changed in his new world.

Now, Gagan even found time to take up running again—and finished a marathon in a personal best time.


I wondered if Gagan’s new company had a chief digital officer. They did not. However, Gagan elaborated for me.


“We did hire a young digital transformation specialist in the IT organization. We couldn’t have done it all without her support. She was instrumental in helping select the right technologies and hire the right talent. She collaborated with my team and the business on use cases and end-user personas, helping us lay a solid foundation for the new platform, with my team supporting the change across the business.”


I asked how Gagan could possibly top this news, to which he responded, “Well, I was just promoted to CIO!”


Do you have a story to tell? Comment below to share how the importance of supply chain management and the digital transformation affects your strategies for business success.


The post Supply chain agility and flexibility: The story of an IT executive appeared first on The 21st Century Supply Chain.


Avaya digital transformation - Kinaxis


Originally posted by Dr. Madhav Durbha at

by Alexa Cheater

It’s not just supply chain planners who benefit from improved S&OP


It’s the entire company—from planners to executives and everyone in between.

Effective, efficient sales and operations planning (S&OP) means you can respond to changes faster, spot opportunities earlier and better align your organization around a common set of goals.


But the benefits of S&OP extend beyond that—they help to simplify the day-to-day work of nearly everyone in your company. Improving S&OP means breaking down silos, connecting disparate data sources, exploring what-if simulations and developing cross-functional collaboration.


If you’re an executive, that translates into the ability to see a complete picture of the entire supply chain in an instant, with the most up-to-date data and changes reflected. Since you’ll be able to see risk or opportunity earlier, you’ll be able to make smarter business decisions faster, keeping your company on track to competition and financial success.


If you work in finance, improved S&OP means peace of mind that everyone puts what’s best for the business at the heart of every decision they make. Instead of working to individual or functional metrics, the entire organization aligns to key financial goals.


If you’re a supply chain manager, you’ll also get peace of mind knowing your actions and decisions benefit both your team and the whole organization, since you’ll be able to see the impacts of any changes you make across the entire network. And with faster, more streamlined S&OP processes, you’ll be able to ensure critical decisions are made collaboratively in a timely manner.


If you’re a supply chain planner, your daily life will become simpler. No more wasting time chasing down data. No more sorting through countless emails just to get caught up on an issue. No more making decisions in the dark. You’ll gain the confidence you need to make more informed decisions, and the freedom to focus on the true exceptions, instead of getting bogged down by small day-to-day changes.


Want to learn more about how to improve your S&OP to better align your organization? Check out our S&OP solution guide where we highlight the importance of data, processes and people.



The post It’s not just supply chain planners who benefit from improved S&OP appeared first on The 21st Century Supply Chain.


Nucleus Research Control Tower Value Matrix


Originally posted by Alexa Cheater at

by Alexa Cheater

It takes more than technology to transform your supply chain.

Digitization is here. And it’s redefining supply chains. Disruptive technologies like advanced analytics, artificial intelligence and the Internet of Things are converging, bringing together the physical and digital worlds into new digital supply chain networks. These networks are taking supply chains from siloed and sequential to dynamic and interconnected. But true digital transformation isn’t just about the technology in supply chain management.


Deloitte digital transformation - Kinaxis


Join us for our webinar, Is your supply chain ready for a digital transformation?, to learn why true digital transformation requires more than just digitization.


When: Thursday, March 15 | 2 p.m. ET


Register for this webinar to hear industry experts Tim Gaus, Principal at Deloitte Consulting LLP, and Trevor Miles, Vice President of Thought Leadership at Kinaxis, explore:


  • What technological evolutions are supporting the rise of digital supply networks
  • How digital supply networks fit within a wider business strategy
  • When to consider building your own digital supply network, and how to get started
  • How quickly digital supply networks can mitigate trade-offs inherent in typical supply chains
  • Whose roles need to change, and how, to support supply chain automation



The post [Webinar] Is your supply chain ready for a digital transformation? appeared first on The 21st Century Supply Chain.


Nucleus Research Control Tower Value Matrix


Originally posted by Alexa Cheater at

by Jeswin Philip

vendor-managed inventoryThe Food Packaging Trends and Advances report from PMMI forecasts that the US Food and Beverage industry will experience a 2.9 % CAGR through 2022. The report also mentions that the global growth rate is almost double that of the US food industry. It’s a prediction that shouldn’t be ignored.


Food for thought: Time for a different kind of supply chain

Continued economic growth, customer preferences (especially those of the millennial generation), the rise of ecommerce and the Amazon channel, increased product choices and newer product categories in the marketplace are all driving the need for efficient and effective supply chain networks to support customer demand.


Among the many supply chain initiatives taking place today, vendor-managed inventory (VMI) has become an increasingly effective process and business model to help organizations share risk and information between vendors and customers — while benefitting from lower stockouts, reduced uncertainty and lower costs.


As with any industry, food and beverage faces its own unique set of supply chain challenges, including:


  • Expiring ingredients, manufactured product and packaged goods
  • Changing customer preferences and the need to continually “stock” the shelf
  • Marketplace competition, too many choices and newer fads (e.g. craft going global in the alcoholic beverages industry)
  • Ever-increasing demand volatility
  • A demanding distribution network comprised of producers, distributors and retailers
  • Regulatory and legal restrictions, and safety and quality issues
  • New Product Introduction (NPI) management

Not surprisingly, each challenge requires its own focus, strategy and best practices to overcome. Now, let’s take a closer look at what VMI is and how it can address some of these challenges through best practices.


What is vendor-managed inventory?

VMI is the process whereby a supplier or vendor manages and replenishes inventory at a customer’s location at the levels required by the customer. The customer shares data such as point of sale (POS) data, customer forecasts, current inventory levels, and inventory target levels, which will be used to develop an appropriate distribution plan by the vendor. The vendor is usually the supplier, a manufacturer or a distributor.


The benefits of the vendor-managed inventory process include:


  • Enhanced visibility for vendor
  • Lower order volatility
  • Higher customer satisfaction
  • Reduced order lead times
  • Better transportation planning

The VMI concept is well documented with a real-world example in Michael Hammer’s best-selling book, Reengineering the Corporation.


Walmart and Pampers: A real-world VMI story

Let’s take a closer look at a vendor-managed inventory case study. Traditionally, Walmart managed its own Pampers (disposable diapers) inventory. However, when the company realized that inventory management is a costly activity, it approached Pampers manufacturer Procter & Gamble (P&G) to manage inventory at P&G’s distribution centers.


Through this arrangement, Walmart would tell P&G how much stock was moving out the distribution centers to its stores; P&G would identify how much to replenish and when. This approach worked so well that it developed into a strong win-win relationship between both companies.


Here’s how…


Walmart offloaded into replenishment function to its supplier, leading to decreased costs, reduced stockouts and lower inventory levels. P&G gained improved visibility into its customer demand, and better supply chain and manufacturing planning led to reduced order lead times. On the storefront, P&G benefitted from additional shelf space and preferred end aisle displays.


VMI best practices at a glance

Here are some best practice guidelines for the food and beverage industry to consider when addressing its own unique challenges.


Maintaining optimum inventory levels

  • Maintain optimum safety stock at all the right points in the multi-echelon supply chain network. If there is too much inventory at any point, you risk having unused, unprocessed inventory subject to perishability, safety and quality controls or obsolescence. If there is too little inventory, you risk not having product on the shelf and losing market share, or increased costs for expedited shipping.
  • Give suppliers/vendors visibility to safety stock and inventory levels at the customer or distributor locations.
  • Provide visibility to customer demand, which helps to stabilize the vendor’s own manufacturing planning.
  • Enable the sharing of information traditionally considered sensitive and confidential data to maintain optimum inventory levels.

Dealing with demanding distribution networks

  • Understand transportation and logistics constraints, and work with third-party logistics suppliers and shippers to gain more visibility into the process.
  • Plan for disruptions. For example, analyze the impact of late deliveries, transportation constraints such as driver shortages, and weather disruptions.

Optimize to reduce transportation spend, while maximizing shipment efficiency. This includes understanding cost drivers, and product flows and lead times; defining service levels; and performing cost analysis and optimization.


Managing SKUs effectively

  • Understand how and when SKUs transition from an old to a new product at both the vendor and customer stage.
  • Visibility to new product introductions is critical across the supply chain for both the vendor and distributor.
  • Understand the effects of material expiry and how it impacts every node in the supply chain model. Material expiry can affect not only the raw material, but also the finished product and the packaged product. Understanding this and having the capabilities to model this into supply chain planning is vital in the food and beverage industry.
  • Integrate distributors’ NPI processes into vendors’ manufacturing and distribution plans to ensure you can replenish the right quantity of the right product at the right time.

Building relationships

  • Develop closer relationships with customers and suppliers.
  • Ensure supply chain planners and buyers have a closer relationship than the traditional siloed approach.
  • Hire or retrain talent for the right skills.
  • Take a “we all win” collective approach instead of an “only I win” approach.
  • Ensure clear and objective communication between companies. For example, jointly develop performance management metrics so that any adopted strategies benefit all parties involved — not just a single entity.

Choosing technology that enables you to:

  • Transmit data in real-time or near real-time across companies.
  • Allow for collaboration between planners and buyers.
  • Perform scenario planning, including planning for supply chain disruptions (constrained manufacturing or transportation) and events and promotions (demand volatility).
  • Real-time transportation visibility and transportation optimization.
  • Translate SKU languages between vendors and the customer.
  • Plan around perishability and material expiry through the supply chain network.

In closing… some words about VMI and the food and beverage supply chain

In today’s food and beverage supply chain, success demands ensuring the right product is on the shelf at the right time. Retailers are selling more brands than ever. Distributors have a huge responsibility to stock the right inventory and improve forecast accuracy — all while reducing obsolescence and waste, managing quality and adhering to regulatory and legal restrictions. Suppliers are under more pressure to reduce lead times, improve quality and reduce costs. Finally, logistics and transportation companies must provide more visibility to their freights while struggling through a shortage of qualified commercial drivers.


I’m not promising that VMI is the ultimate answer, but it is one giant step in the right direction. VMI can help ensure you build the right relationships, product is always available when it should be and customers don’t walk away dissatisfied.


Do you have any VMI real-world stories or use cases? I’d love to hear your thoughts.


The post Vendor-managed inventory and distribution planning in the food and beverage industry – here’s something to chew on appeared first on The 21st Century Supply Chain.


Nucleus Research Control Tower Value Matrix


Originally posted by Jeswin Philip at

by Joe Cannata

Kinaxis CertificationIt all started a little more than two years ago with two supply chain management certification exams — Kinaxis® Certified RapidResponse® Author Level 1 and Kinaxis Certified RapidResponse Administrator Level 1.


Since then, we’ve grown our supply chain management exam portfolio to provide exams for contributors, authors and administrators, while also adding integration- and application-focused exams.


We’ve also added three new credential levels to help partners and employees qualify for integration and solution consultant roles, which go beyond formal written exams to include training in soft skills and practical field experience.


Combined, these exams and achievements create a firm foundation upon which to build toward our ultimate, top-level credential, the Kinaxis Certified RapidResponse Master.


Becoming a Kinaxis Certified RapidResponse Master

Representing the highest achievement in RapidResponse expertise, along with the respect and experience that comes with a supply chain industry thought leader, this credential symbolizes more than just having passed a series of exams. A Kinaxis Certified RapidResponse Master demonstrates practical field experience and a well-rounded background in the supply chain industry.


To qualify, he or she has worked in all Kinaxis RapidResponse job roles, has been a leader on multiple engagements across different verticals, has performed a variety of integrations and has implemented multiple applications. A Master is a distinguished individual with multiple talents and is highly respected within the Kinaxis ecosystem.


With credential requirements developed by cross-functional senior Kinaxis leadership and input from the partner community, the road to becoming a Kinaxis Certified RapidResponse Master is a steep but reachable height.


Potential Masters must have:


  • Five years in the supply chain industry
  • Level 2 Integration or Solution Consultant credentials
  • Level 3 Integration or Solution Consultant credentials
  • Three years direct experience on Kinaxis projects or engagements
  • Six months (or 1000 hours) working in at least two different supply chain verticals
  • Deployed at least four different applications
  • Two or more years as a mentor, coach or leader in supply chain management
  • Acted as an influencer through blogs, executive presentations, or decisions that have a significant business impact (Complete details on this requirement can be found the Kinaxis Certification (login required) page in the Supply Chain Expert Community.)

Qualifying candidates must submit appropriate documentation and/or proof of achievement. A peer review board comprised of Kinaxis stakeholders and senior members in the partner community will evaluate the submission.


As rigorous as it is prestigious, the rank of Kinaxis Certified RapidResponse Master signifies worthy candidates who will continue their careers having earned our highest honor and distinction.


The post The ultimate Kinaxis credential appeared first on The 21st Century Supply Chain.


Deloitte digital transformation webinar


Originally posted by Joe Cannata at

by Alexa Cheater

Prescriptive analytics and artificial intelligence are coming

Integrated business planning I talked about integrating finance into supply chain operations, including outlining how integrated business planning (IBP) can help. Now it’s time to look at how IBP can take your supply chain to the next level of performance, and bring finance right alongside with you.


Just as with other areas of supply chain management, machine learning and artificial intelligence (AI) are likely to find roots in IBP, primarily through the introduction of prescriptive analytics. Unlike descriptive analytics, which looks at what happened and why, and predictive analytics, which explores what will happen, prescriptive analytics suggest actions and shows the implication of each potential option. It tells you the best way to get to where you want to be.


Modelling financial and operational business constraints and using prescriptive analytics alongside IBP provides enhanced visibility and the ability to better manage change. The result is a more holistic picture of the organization and faster decision-making by executives. IBP done well provides a periodic rolling forecast, highlights gaps between the budget and operations and helps direct the company to where it wants to be.


Adding dynamic data integration and assumptions like capacity, downtime and material availability directly from intelligent machines will create an automatically updated plan and forecast, which could then trigger warnings to managers if misalignment occurs. You’d be able to intervene before critical thresholds are breached. We’re already getting closer to this reality, but prescriptive analytics could take over tactical and strategic decisions when looking further out. This would create prescriptive execution, where self-learning and self-sustaining algorithms not only outline the best solution and implement it, but also make changes afterwards to incorporate changes in circumstances.


Stuart Harman, a partner at Oliver Wight Asia Pacific, believes the future of IBP lies in the improvement of short-term planning and execution to ensure medium-to-long term plan deliverables. He says companies are unfortunately, “… being held back by the absence of a robust, formal, daily/weekly planning and execution process that integrates demand, supply, product management and customer service activities in the short-term planning horizon (typically the next 12 weeks).”


Improving this area means senior management spends less time being sucked into short-term activities unless their attention is actually required (exception management), and allows them to focus on the longer-term planning horizons associated with IBP.


Hand-in-hand with this improved execution will be an emphasis on better understanding where growth is coming from and how an organization’s products and services provide value, all of which will be updated through the IBP process. More organizations will adopt IBP as a way to plan for uncertainty and volatility, using it to identify areas of risk and where their supply chains are most susceptible to change.


As Harman notes, “Having the right processes in place will allow companies and supply chains to improve their understanding of the potential outcomes and ultimately enable them to prepare for uncertainty. The companies that do this the best will be able to seize the opportunities that always accompany change.”


The future of IBP lies in its ability to plan across the extended end-to-end value network, not just inside your own four walls. This requires understanding and incorporating constraints from interdependent supply chains and commodities across global boundaries. But the result will be a better corporate-wide understanding of constraints, risks and opportunities.


The post The future of integrated business planning appeared first on The 21st Century Supply Chain.


Deloitte digital transformation webinar


Originally posted by Alexa Cheater at

by Bill DuBois

When sacrificing family time becomes the norm

Supply Planning Without the Personal Sacrifice Supply planning – to profitably align supply with demand. It sounds like something you could get done during an honest day’s work. As it turns out, it’s not that easy.


When I was planning supply, it wasn’t unusual to have a dinner interrupted, a weekend cut short or a vacation disturbed. That happened to be the norm. It wasn’t a surprise when a supplier shipped late, a machine was suddenly overloaded or a demand planner informed you that you were working off the wrong demand plan. We spent hours, even days sifting through countless spreadsheets and trying to navigate manual processes.


During that time, we also invested in some “just-in-time” techniques we borrowed from the Toyota Production System (TPS). Unfortunately, our planning survival instincts kicked in and our just-in-time processes were supplemented with just-in-case fallbacks. All of a sudden, we had just-in-case inventories,  and an exceptionally high number of expedites which really did nothing more than mask our supply planning deficiencies.


Taking back ownership of the issues

All of that was just business as usual. When we ran into unexpected disruptions like machine breakdowns or weather events that hampered deliveries, then it was goodbye to family time because the scramble was on. We thought we’d be in much better shape if suppliers could just keep their commitments, operations could manage their resources and demand planners could just get it right.


However, when we took a step back, we realized suppliers didn’t have timely information and supply planners were unknowingly overloading resources because they had no visibility into constraints and our manual processes. This meant it took too long for supply planners to understand the impact of demand changes.


Understanding what needs to change

Something needed to change. We needed to connect our supply chain planning to the rest of the network to include demand planning, operations and external suppliers. If there was a top-level demand change, we needed immediate bill of material explosions that would show us impact. We needed to consider all of our planning attributes like sourcing restrictions or material expiry.


We also realized we needed a smarter supply chain.


If we did have material that was going to expire, we needed automatic notifications to alert us so we could plan accordingly to avoid excess and obsolete materials. If we did get hit with the unexpected, we needed to simulate tradeoffs and compromises. By understanding the impact on revenue, delivery and margin, we could make decisions in time to have a positive impact on our performance.


Our latest eBook, Four mission-critical capabilities for navigating supply chain complexities, does a great job of capturing and explaining these supply planning capabilities.


Not only did we do a better job of profitably aligning supply with demand by implementing those critical capabilities, but I got my weekends back.


Check out the eBook here and let us know what you think.


Navigating Supply Planning Complexities


The post Supply chain planning – it’s time to get personal appeared first on The 21st Century Supply Chain.



Originally posted by Bill DuBois at

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