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2017
by Melissa Clow

This blog is part of a video interview series. Check out the video below as well as links to other supply chain practitioner and Kinaxis executive interviews.

 

The long-term objective at Roland DG Corp. is to elevate its supply chain organization to the strategic decision-making level, says Zoltan Pekar, vice president of the company’s global supply chain division.

 

To achieve that, the manufacturer of wide-format printers, needs a truly collaborative environment and a consolidated sales and operations planning process. Roland is relying on RapidResponse from Kinaxis to help it realize that goal, Pekar says. With RapidResponse, the organization has connected the company data worldwide, and provided transparency and accurate reporting across the organization.

 

The company-wide transformation that Pekar speaks of required a change in mind-set. “That was critical in the process, and I’m very happy to say that now we have a full sales and operations process, we have people coming together to search for information, and it’s all based on RapidResponse. It’s been valuable, and we have lots of other plans to build on this data platform.”

 

Pekar dismisses criticism of S&OP as a minor process. “The key factor for us was to bring the sales and operational sides together because we were a very fragmented organization with silos, and the RapidResponse tool has brought these sides of the business to the same table to make decisions.”

 

Roland DG deals with business-to-business transactions of industrial equipment. Its sales cycle is fairly long, but it provides a full solution of consumables and spare parts. Responsiveness to customer needs is very important. “Being able to see the entire process and the visibility of the data helps us tremendously to respond to all those needs,” says Pekar. “Being able to see the changes in demand and being able to respond to it on a single platform is extremely important.”

 

Roland DG is building Internet of Things functionality into its equipment to enable it to do maintenance and repair in a proactive and predictive way. “The transparency that RapidResponse provides will optimize those efforts,” Pekar says.

 

Check out the other video interviews in this series:

 

The post [Video] Roland DG: Transforming its sales and operations planning process appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Melissa Clow at http://blog.kinaxis.com/2017/05/video-roland-dg-transforming-sales-operations-planning-process/

by Dr. Madhav Durbha

Gartner Supply Chain Executive conferenceI enjoy attending conferences. They give me the opportunity to reflect, reconnect and recharge. One conference I recently attended is the Gartner Supply Chain Executive conference in Phoenix, Arizona. With a lineup of very inspiring speakers, provocative content and pragmatic use cases shared by practitioners, the event certainly lived up to the theme of ACT (aspire, challenge and transform). Here are my takeaways:

 

1. Digital disruption is here and now: John Phillips, SVP of Customer Supply Chain, PepsiCo, presented some fascinating examples of getting products into the hands of consumers in unique ways powered by robotics and artificial intelligence. Here are some of the examples he shared to highlight how the traditional linear supply chains are being disrupted:

 

  • Connected home sharing consumption signals (e.g. smart refrigerators and Amazon dash buttons)
  • Cashier-free stores powered by the Internet of Things (IoT) (e.g. Amazon Go)
  • In-store robotics (robots scanning shelves and delivering real-time signals)
  • Crowdsourced delivery through services such as Postmates, Instacart and Shipt
  • Use of drones (EyeSee inside the warehouse for scanning and tracking inventory, Prime Air for delivery)
  • Autonomous vehicles going well beyond driverless cars (e.g. Otto)
  • Virtualizing experts (use of Augmented Reality to enable remote troubleshooting by field services personnel)
  • Artificial Intelligence to automate higher cognitive skills

One common theme I found in almost every one of these use cases is the application of computer vision. However, when computers go well beyond seeing, by interpreting and making decisions, it raises some interesting questions. Two questions John Philips encouraged the audience to consider were:

 

  • Do we have the capability to deliver to these digital signals?
  • Do we have the organizational structures in place to harness the digital disruption?

2. Connected devices not only create digital supply chains, but also entirely new ecosystems. In their keynote presentation, Michael Burkett and Debra Hofman of Gartner presented the example of a cloud-connected ecosystem of John Deere, Monsanto and Cargill with farmers at the center of this ecosystem. John Deere is equipping its tractors with smart sensors constantly collecting the local data around soil type, soil conditions, irrigation, etc. Other partners are contributing weather-related insights, commodity pricing and external data feeds – all connected with real-time digital interactions forming a digital platform that gives farmers insights into how to maximize crop yields. Use cases in such ecosystem extend beyond the traditional definition of supply chain management and unleash the tremendous potential of data-driven insights.

 

3. Humans and machines – collaboration or conflict? There were plenty of sessions focused on the rise of cognitive intelligence. That brings up the question of how humans and machines coexist in this new world. Here are two takeaways:

 

a. Jobs with a high degree of physical activity will be replaced by the machines: With autonomous vehicles, the jobs of long haul truck drivers are in jeopardy. Amazon Go is a classic case of how a store can be operated with no human labor. Use of drones and robots in warehouses eliminates the need for humans picking, putting away, or counting inventories. This will mean a good portion of workforce of today will need to upgrade their skills.

 

b. Supply chain organizations will need to evolve: Beyond the physical labor, with the rise of prescriptive analytics, machines evolve beyond decision support to decision-making. The traditional planning organizations will need to evolve to make use of big data analytics and cognitive computing. In a highly engaging and provocative presentation titled, “Get ready for IoT in Supply Chain Planning,” Andrew Downard of Gartner made a compelling case of how organizations need to be prepared for the rise of “Algorithmic Planning.” He took the example of demand planning where the potential exists for a 10% to 20% improvement in forecast accuracy with sensor-connected systems such as a Coca-Cola Freestyle machine or Amazon Dash buttons. However, he said skill mix as it exists today will need to be reassessed to unleash this improvement potential. He gave the example of how an organization should consider moving from having 5 demand planners to 3 demand planners, 1 data scientist and 1 data engineer.

 

All in all, the message from various sessions was clear. Humans at all levels will need to retool their skills and learning can never stop. This takes us to the next insight.

 

4. Developing supply chain talent for the future: In her keynote, Nicole Jefferies, Executive Director of Customer Fulfillment, Lenovo, talked about her philosophy and how she is putting it to practical use at Lenovo to groom supply chain talent. She presented a model for learning that consists of 10% coming from formal training, 20% through relationships and 70% through doing. She introduced the notion of “mentorship circles” wherein groups of 10 can learn from each other and from the leader. She encouraged the audience to think of career as not a simple linear progression but instead as a web with multiple touch points. Specifically, with regards to supply chain, she encouraged these “training webs” to consist of functional, managerial and analytical skills to groom well-rounded supply chain professionals.

 

5. Rising expectations from SCM leaders: In an aptly titled presentation, “P&G’s pivot from cost management to driving business outcomes,” DeLynn Louth, Associate Director of Supply Network Operations , P&G, talked about how the expectations of supply chain organization have been raised from cost management to include capturing revenue growth. Stan Aronow of Gartner, co-presenting at the session, talked about a recent survey of 141 CEOs and senior business executives, wherein 57% of the respondents rated “growth” as the number one objective compared to 15% identifying “cost” as the top objective, reflecting P&G’s own experience. Louth talked about how some of her team is collocated with sales teams, working hand in hand to achieve growth drivers. These drivers included on-shelf availability, promotions amplification, increased distribution through responsiveness, increased events through supply chain flexibility, increased shelf investment through joint value creation and increased trade spend efficiency through less markdowns.

 

Overall, it was a great event. I was also encouraged to see the demographic diversity amongst the attendees which perhaps is a reasonable sampling of the supply chain professionals as a whole. In fact, in a session by Robert Allen and Joanne Wright, IBM, on “Gaining greater visibility with Watson analytics”, an introductory video they played included more women than men, as was aptly observed by my colleague Trevor Miles. Of course, there is much more to be done to promote gender diversity in the supply chain profession, but I have no doubt the supply chain community as a whole will rise to the challenge!

 

The post Aspire, challenge and transform: Insights from the Gartner Supply Chain Executive conference appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Dr. Madhav Durbha at http://blog.kinaxis.com/2017/05/aspire-challenge-transform-insights-gartner-supply-chain-executive-conference/

by Alexa Cheater

One message came through loud and clear during Gartner’s recent Supply Chain Executive Conference; you must ACT (aspire, challenge, transform) now if you want to have any hope in taking your supply chain profitably into the future. The conference’s theme of Aspire, Challenge and Transform in a Disruptive World featured prominently in the opening keynote address by two of the research firm’s VPs, Debra Hofman and Michael Burkett, who urged attendees to re-imagine their roles and ask how they will meet the future.

 

The pair talked about how disruption is the new norm. I would argue it always has been, but agree the explosion of interconnectivity and digital disruptors is causing an immediate impact on supply chain—even if the supporting technology behind it has individually been around for years. I’d also agree that to be successful it’s time to re-define the very notion of supply chain.

 

Providing an experience, not just a product

With more than $16 trillion exports moving between countries annually, the new reality isn’t just focused on getting the right product to the right people at the right time. As Hofman and Burkett put it, it’s about creating an experience-focused supply chain, which will force you as supply chain managers and leaders to gain a better understanding of your customers than ever before.

 

You have to be able to solve the problems your customers didn’t even know they had, provide personalization and offer smarter products—ones that can grow and adapt and change in unexpected ways. One example highlighted during the Gartner conference was the creation of smart toothbrushes, which when connected to a mobile app can guide you in improving your brushing technique by recognizing (via sensors) areas you may be missing. You can even share the data with your dentist for a more complete picture of your overall oral health habits.

 

But just having a connected toothbrush isn’t enough. Through APIs, other vendors can enhance the product further, like connecting your Spotify playlists so you can brush your teeth to your favorite beat. That’s how you start to build an experience.

 

Hofman and Burkett talked a lot about defining a vision for the future and aspiring to expand the definition of supply chain beyond its current confines. They focused on customer experiences and the notion of how virtual ecosystems can power them. In this context, Gartner defines ecosystems as “interdependent business networks offering innovation and productivity benefits to members through electronic interchange.”

 

Orchestrating this new virtual ecosystem requires collaboration with partners, suppliers and customers. An easy example of this type of working relationship is what’s happened with connected cars. Automakers build the product, but leverage relationships with other manufacturers to offer enhanced services and experiences such as GPS, satellite radio and even telecommunications options like Apple’s CarPlay. The end result is creating an overall driving experience—not just selling a car.

 

Another less expected case study is what’s happened in agriculture and the emergence of a new virtual farming ecosystem that’s delivering innovative solutions to a centuries old industry. Agricultural producers like Monsanto are working with equipment manufacturers like John Deere to provide real-time information about seed quality and equipment efficiency to help farmers maximize crop yields. Now imagine commodities traders got involved in this ecosystem. They could provide added data around market trends to help determine which crops will be most profitable to plant and when. Farmers would be able to maximize for financial gains and crop yields. But that only becomes a possibility if these partner relationships continue to grow, and more importantly, succeed.

 

Managing digital capabilities

Another aspect to envisioning the future is recognizing the impact digital capabilities have on the supply chain. They’re finally starting to deliver real business value. While artificial intelligence (AI) has been around for years, Hofman and Burkett say it’s only now that it’s approaching a stage that will disrupt supply chains as we know them. Advanced algorithms, machine learning, big data, deep learning, neural networks, natural language—all are coming into play in creating a dynamic and self-adapting supply chain that functions much like the human brain.

 

This reality is a lot closer than you may think. Gartner’s research shows 20% of companies in their supply chain top 25 are already piloting or in production with augment reality or AI. That’s because with the amount of data, rate of change and number of IoT devices, things have expanded beyond the ability for humans to keep pace. No matter how much of a math genius you are, you can’t make the necessary calculations and corrections fast enough.

 

P&G is experimenting with AI for exception planning, using it to prevent and resolve not only known exceptions, but new types of exceptions as well. KTM is playing with augmented reality, using it to help any service technician repair any motorcycle no matter that technician’s experience level. However getting to a point in your organization where these types of experiments are not only approved but encouraged means tackling some pretty big organizational challenges.

 

Overcoming barriers

There’s no doubt we’re entering a disruptive era, but to assess how prepared you are to boldly lead your supply chain into it, you need to ask yourself a few questions:

 

Do you have a vision for the future of your industry? Is yes, do you as a supply chain practitioner have a voice in making that a reality? According to Gartner, 40% of chief supply chain officers (CSCOs) say their CEOs still see them as just a cost center. Speak up.

 

Are you close enough to your customers? It’s not enough to identify who your customers are. You have to know them, as intimately as possible. Providing that expected exceptional customer demands it. Learn more.

 

How fast can you innovate? You need a bimodal supply chain—one that’s driving toward sustainability and innovation simultaneously to be able to innovate at a pace that can effect change. Explore possibilities.

 

Does your team have the right skills? The future is leaning toward humans and machines making decisions jointly. Work will look and feel different and offer a better mix of optimizing time and labor. You’ll need more data scientists to model based on advanced algorithms and folks who can teach and train the machines running them. Recruit talent.

 

Once you’ve conquered those challenges, it becomes about designing your future.

 

Create a digital platform

The customer appetite for experiences is there and so are the required digital capabilities. Next you’ll need a build a digital platform to manage and deliver them. Hofman and Burkett warn architecting it shouldn’t just be left up to IT. Your digital platform needs to encompass customers, ecosystems, connected devices, intelligence and IT systems. It has to lead to the creation and alignment of your company’s digital path. Unfortunately, that’s easier said than done. Gartner’s research shows 76% of digital projects aren’t aligned under a single governance.

 

Your supply chain technology model needs to align to your supply chain operating model, and that has to align with your business model. If you let IT dictate what this new digital platform will look like, you’re giving them the power to define how your supply chain will be structured in the future, because ultimately it will have to align with the rest of the digital path.

 

Once you’ve built this new digital platform, then all you need is a strong leader and the right team to take you down that digital path.

 

Build the right team

Burkett said it best, “True leaders will take us to places we didn’t know we needed to go.” You’ll need a leader who can bring both sides of the bimodal supply chain together seamlessly. You want someone with experienced hands, who knows how things traditionally operate, but with a beginner’s mind, meaning they’re open to new ideas and processes. That will give you the ability to blend best practices with new ideas.

 

“The beginner’s mind sees many possibilities, while the experienced mind only sees few.” —Shunryu Suzuki

 

You’re also going to need to diversify—not just across gender or cultural lines, but also across cognitive lines. Build teams that have a blend of analytical and emotional personalities. While fireworks may sometimes ensue, it’s through this diversity of thought, guided by unity of purpose, that you’ll see the biggest breakthroughs. Just make sure your leader has the skills to manage such an explosive team dynamic.

 

Embrace the excitement

Chaos isn’t going away anytime soon. It’s always been there in shades, but more recently seems to have burst forward again in its many splendid colors. But you can adapt to it and use it to drive supply chain excellence and growth. As Hofman and Burkett noted in their presentation, you just need to be bold!

 

The post ACT now to take your supply chain into the future appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Alexa Cheater at http://blog.kinaxis.com/2017/05/act-now-take-supply-chain-future/

by Melissa Clow

This blog is part of a video interview series. Check out the video below as well as links to other supply chain practitioner and Kinaxis executive interviews.

 

The ideal center of excellence not only supports internal teams at a company but advocates for customers, says Leah McGuire, director of the Kinaxis Center of Excellence.

 

The Kinaxis COE supports project teams, consultants deploying the company’s RapidResponse tool in the field, and pre-sales teams that use demos, says McGuire. Additionally, the center is responsible for developing best practices within the tool. All of which means that center employees have to have strong technical backgrounds as well as complete familiarity with RapidResponse.

 

Advice for any company looking to establish a center of excellence? “You need to have people who are very good with change. That’s because they are change agents responsible for rolling out new processes and solutions to the organization. You want to make sure they are good communicators who are flexible and can roll with the punches as they roll out new things to the customer.”

 

And it goes without saying that you need executive sponsorship not only to set up a COE but to staff it with the right kind of personnel, McGuire says.

 

A center of excellence should be set up only after a needs assessment has been conducted to see what should be provided to the organization. Then you start small, with a staff of only a few people. How many people in the company need support from the COE? As the user group swells, the center can staff more, especially if the company expands into different regions or establishes more business units. “But you start small, establish your processes, and look at the training you’re providing,” McGuire says.

 

Customer success is a prime focus of the Kinaxis COE. “We are their advocate internally. We partner with them to develop things like success plans and road maps on how to roll out RapidResponse within their organization. We also bring their innovation back to Kinaxis so we can integrate it into the tool if necessary.”

 

Check out the other video interviews in this series:

 

The post [Video] Supply chain centers of excellence and customer success appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Melissa Clow at http://blog.kinaxis.com/2017/05/video-supply-chain-centers-excellence-customer-success/

by Alexa Cheater

Sales and operations planningThe face of sales and operations planning (S&OP) is changing. Gone are the days when sequential, isolated planning and monthly meetings based on out-of-date data are sufficient to drive stability and success.

 

End-to-end initiatives now span beyond the confines of a single company’s supply chain, encompassing extended supplier and customer value networks, as well. Digitization, sparked by the rise of the Internet of Things (IoT), the expanding number of connected devices and big data, is driving a shift in consumerism. Your company needs to keep pace, or risk falling behind forever.

 

The reality is, supply and demand waits for no one — not even your executive team.

 

Running a profitable global business requires speed and agility in both strategic and
tactical planning. But transitioning to a new way of looking at S&OP means saying goodbye to scheduled decision-making, a frightening thought for many. It may seem like an impossible step. How can you let go of the security of regular meetings planned weeks in advance? Or the safety of knowing those big decisions only come around once a month?

 

We got to this state of scheduled decision-making through siloed business functions, disparate data and technology limitations. We’ll overcome it by looking toward a future where S&OP processes run continuously and collaboratively. Driving this shift in process is the notion of concurrent planning – the ability to continuously and simultaneously plan, monitor and respond to changes in a single supply chain management solution.

 

Concurrent planning bridges functional silos and connects all nodes in the supply chain, enabling cross-functional coordination and faster, more effective decision-making. It allows you and your peers to seamlessly scenario plan across multiple time horizons, providing improved performance and profitability. It also helps solve the planning horizon challenges many organizations now face. Namely, bridging activities for short-term planning (low impact, high frequency) with long-term planning (high impact, low frequency), and accounting for high impact, high frequency events.

 

The future of S&OP is collaborative decision-making and perpetual planning. This revolutionized way of looking at planning concurrently could shift business processes and supporting organizational structures. Frequency no longer becomes a limiting factor, and the resulting faster scenario analysis and simulation will enable efficiency and cost savings.

 

But getting to a state of concurrent planning requires several foundational capabilities within your supply chain system.

 

What-if scenarios

Traditional simulations take time and often happen in silos, ultimately slowing down the time it takes to analyze data, model options, make a final decision and get the necessary buy in from other functional business areas.

 

Having the ability for anyone to run a simulation using any data at any time, and then share the results with others in the supply chain means a more effective way to connect data, process and people within a single system. It creates the ability to ask the right questions of the data and provides a record of the answer, and the decisions that led up to it.

 

Collaboration

Gone are the days when planning for a single function happens in isolation. Collaboratively making decisions allows faster, more efficient understanding of the end-to-end impacts of potential choices.

 

Collaborative decision-making is ushering in an era where informed trade-offs are being made. Instead of working toward individual objectives, everyone is working toward the same set of corporate-wide metrics.

 

Record keeping

In many cases, data manipulation, what-if scenario creation and collaborative discussions are taking place across multiple systems. And with the time it takes to circulate all the relevant information to the decision makers, it’s likely you’re only capturing the end results, not the debate and trade-offs leading up to it.

 

In order to learn and grow from past mistakes, we need to understand why we made a particular decision in the first place. That means capturing the context as well as the outcome—providing a better picture of cause and effect.

 

The rapidly increasing pace of business demands changes to current S&OP practices, and advanced technology is making it possible through concurrent planning. It’s time to step away from siloed, scheduled decision-making and move toward collaboration, and parallel planning.

 

Learn more about the future of S&OP and how to get there with our eBook, Powering the future of S&OP: 3 capabilities to fuel your journey. Download it now.

 

The post Goodbye scheduled decision-making, hello concurrent planning appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Alexa Cheater at http://blog.kinaxis.com/2017/05/goodbye-scheduled-decision-making-hello-concurrent-planning/

by Melissa Clow

This blog is part of a video interview series. Check out the video below as well as links to other supply chain practitioner and Kinaxis executive interviews.

 

The task of linking sales and operations planning systems of any company with truly global reach is difficult enough to begin with, says Lindsey Kathmann, supply chain analyst at TE Connectivity. But complexity is heightened when the enterprise is structured into separate business units, some with their own spinoffs.

 

That’s the situation faced by TE Connectivity, which specializes in designing sensors for several industries. It’s divided into Transportation Solutions, which focuses on cars, planes and trains; Aerospace, Defense & Marine; and Industrial, which specializes in consumer products, such as cell phones.

 

Kathmann works in the commercial transportation department, which is a relatively new spinoff of the Transportation Solutions business unit.

 

Her group is benefiting from its relationship with Kinaxis. “We try to have an integrated sales and operations planning process,” she says. “Sales gives us data on products that already exist, product management gives us information on new product launches and things they see in the pipeline in the future. That data and those forecasts are given to the demand team and they put it into RapidResponse and give it over to the supply team.”

 

“We’re able to use that data to do PFEP [plan for every part] and EPEI [every part every interval], take that data and make sure from a product family level that we have enough capacity going forward.”

 

If there is insufficient capacity, the product management team is called in to determine what added equipment might be called for, Kathmann says.

 

Kinaxis has brought a needed efficiency to TE, she says. “I’ve been in situations before RapidResponse [was implemented] where teams were doing things by hand, trying to pull data out of the legacy systems and putting it in Excel, and members of the materials team spent hours on something they could just pull straight out of RapidResponse. It’s more accurate and you get better data to all the teams, from forecasting to finance.”

 

Check out the other video interviews in this series:

 

The post [Video] TE Connectivity – A continuous sales and operations planning process appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Melissa Clow at http://blog.kinaxis.com/2017/05/video-te-connectivity-continuous-sales-operations-planning-process/

by Alexa Cheater

5 hurdles the semiconductor industry needs to jump over to find success

Semiconductor supply chainBuilding your business on someone else’s supply chain blueprint may not be the best way to find success. What works for one company may not work for another – especially if they’re in varying industries, geographies or are different sized enterprises. As I noted in my earlier blogs in this series on consumer electronics and life sciences, each industry has unique supply chain pain points that need to be overcome to improve efficiency and profitability.

 

When it comes to the semiconductor industry, one of their biggest supply chain hurdles is that the speed of new technology introduction is 2-3X faster than the research and development (R&D) timeline. It’s a highly capitalized industry thanks to the high cost of fabrication centers (Fabs). It’s transforming from design and manufacturing companies into design and product companies. These new fab-less companies are working with foundries to manufacture wafers, instead of fabrication centers.

 

The cyclical nature of the semiconductor space requires impact mitigation through product expansion (portfolio diversification) and rapidly scaling capacities. The result is an increase in mergers and acquisitions (M&As) to stay competitive, leading to disparate processes, systems and tools.

 

Here are a few other challenges the semiconductor supply chain has to face.

 

Front-end (FE) manufacturing output requires added manufacturing steps

FE outputs like wafers or dies, require additional manufacturing steps like assembly and testing and a blended model. This drives complexity across the supply chain, making efficient capacity planning extra difficult.

 

Solution: Allocate capacity across multiple sites, business segments and/or products to minimize the impact of site-specific constraints. You’ll also need to have the ability to compare multiple capacity allocation scenarios to determine the best option for back-end (BE) capacity allocation. This minimizes customer impact and maximizes profitability.

 

FE cycle times are much faster than BE cycle times

FE cycle times are typically 6 to 8 weeks, while BE cycle times are only 1 to 2 weeks. That means postponing inventory at various manufacturing stages, which requires additional planning.

 

Solution: Inventory postponement planning and late-stage differentiation for BE are critical to managing working capital and to provide improved capacity flexibility. It’s best to use an analytics-based strategic policy for this to mitigate forecast error, factory excursions and the impact of natural disasters.

 

Limited end-to-end supply chain visibility and planning

Multiple direct and indirect materials required for manufacturing, and unconnected internal and contractual manufacturing sites and distributions centers, makes supply chain visibility difficult, learning to excess inventory growth and poor customer service.

 

Solution: Integrate all disparate systems for easier planning and greater visibility. This will drive greater comprehension of multi-tiered sourcing and manufacturing constraints, enabling integrated planning, scenario analysis and better, faster decision-making.

 

Customer-specific requirements

The same product often has different material, site, quality, manufacturing, shipment size, etc. requirements, all based on each customer’s individual demands. There’s also rarely a formal forecast applied to samples requested by the customer, or the cost and capacity requirements associated with them.

 

Solution: Using attribute-based capacity planning, tracking customer attributes for multiple customers in multiple product tiers is easier. Without it, human glue is the only thing holding things together – making the process error-prone and highly inefficient. And don’t forget to add samples to your planning for early stage SKUs and product families. This will provide a clearer picture of capacity and the cost of doing business.

 

Data latency

Power, performance and function-based binning of wafer-die can result in multiple co-products from the same wafer. Different functions, each using different planning parameters, causes data latency issues because that data is housed in multiple, disparate systems.

 

Solution: You should monitor and update planning parameters in a single system through scheduling, which will enable you to see the most recent official parameters available and work from one single source of data truth. Early visibility into project planning parameters gives insight into potential co-products to drive early demand shaping actions. That way you can ensure co-products are consumed and profitability is increased.

 

These are just a few of the specific semiconductor supply chain pain points. What other challenges are you facing in your supply chain? Let us know in the comments section below.

 

And don’t forget to check out the other industries featured in this blog series:

 

  • Consumer electronics
  • Life sciences

Stay tuned for the next instalment when we take an in-depth look at the supply chain challenges the automotive industry faces.

 

The post Supply chain pain points: Semiconductors appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Alexa Cheater at http://blog.kinaxis.com/2017/05/supply-chain-pain-points-semiconductors/

by Alexa Cheater

8 life sciences-specific challenges and how to overcome them

Life sciences supply chain

As I mentioned in the first blog of this supply chain pain points series, working in supply chain is tough business. Every company’s supply chain is unique, with its own set of challenges and solutions. But when it comes to life sciences supply chains, things just seem to be a whole lot more complicated.

 

Regulations, expirations and generic and brand name labels add a certain complexity to the mix not always seen in other industries. Branded pharmaceuticals tend to be high margin products, while generics are lower margin with a large volume of new product introductions (NPIs). With an extremely competitive landscape, mergers and acquisitions are common, leading to a multitude of disparate enterprise resource planning (ERP) systems, wreaking havoc on end-to-end supply chain visibility. Here are a few more obstacles those of you working supply chain in life sciences have to contend with.

 

Lack of robust sales and operations planning (S&OP) tools

Traditional S&OP tools don’t always account for the specific needs of the life sciences supply chain. S&OP in this space requires volume level planning at multiple hierarchies and provide mix level detail including material and capacity constraints at the site and SKU level.

 

Solution: Implement an S&OP tool that provides easy balancing of supply and demand at multiple levels of aggregation. Planning functionality should include multiple time dimensions with real-time analysis, and give you the ability for robust scenario simulation to evaluate options.

 

Tenders, trade promotions and new product introductions

It can be hard to manage these types of demands considering they often don’t exist in legacy ERPs. Given approximately 80% of profit from new products comes during launch, this is a crippling obstacle for many.

 

Solution: Find a way to get that critical data into your ERPs. Supply chain management software exists providing just such a capability. You’ll also need the ability to model the probability of demand for tenders and trade promotions, including probabilities and priority-assignment. Modelling NPIs as pseudo parts (with their own pseudo demand and bill structures) provides much-needed visibility and analysis to projected fulfillment, revenue, capacity and material availability.

 

You can only satisfy demands with supplies meeting specific characteristics

Expiry dates, stop-sell dates and batch numbers – you have to account for all of these special attributes when looking at your supply. You may think you’re able to fulfill demand, only to discover you don’t have enough products meeting the expiry date requirements to actually deliver. That’s not a great way to improve customer satisfaction levels, and can lead to greater amounts of excess or obsolete inventory.

 

Solution: Enable special supply and demand allotment based on these unique parameters and make sure you factor them in when calculating available demand. It’s even better if your technology solution can handle all this automatically, including providing projected excess.

 

Expiry dates are associated with specific SKUs

With thousands of SKUs all with individual SKU and batch expiry dates, the odds of those items expiring on warehouse shelves becomes a real concern. It directly impacts availability and inventory excess. Not to mention what it does to your inventory risk and bottom line.

 

Solution: Calculate projected expiry at multiple levels when planning. And don’t forget to consider inherited expiry from lower level supplies. When a batch of products does expire, make sure to stop considering the quantity as viable and plan for new supply to meet future demand. Your best plan of action is to monitor product expiry by country and affiliate-specific criteria related to allowable shelf life, and set up a system of alerts before expected expiry dates, so you can take action before the item is no longer usable.

 

Campaign planning

Multiple production line setups often result in poor equipment utilization and way more inventory than you need at any point in time. It’s inefficient, costly and not a great way to run your operations if you want to stay profitable for long.

 

Solution: Make sure you connect production of the same material when executing through batches. This will help reduce the number of setups and make your production line more effective in the long run.

 

Transition dates are assigned for SKUs

That means if regulatory approvals are delayed or expedited, the change in dates affects supply and demand.

 

Solution: You should model transition dates to work to determine what materials you need to produce to account for the change (including lower level materials).

 

Increased outside pressures

As with any business, there are often outside pressures that have a big impact inside your operations, and those working in life sciences aren’t exempt. Things like shifts in regulations and changes in approvals are beyond your control. As are patent cliffs, which can have a monumental effect on your revenue streams as competitors get license to sell the same products.

 

Solution: Make sure you thoroughly evaluate supply chain risk and have all available information before making any decisions. Simulate scenarios and evaluate impacts across the entire supply chain, but ensure you compare the results against key performance indicators so you know exactly where you’ll need to make any tradeoffs.

 

Lot-for-lot planning

It can be difficult to manage lot traceability across all levels of your supply chain, including aligning supply to upstream work orders. Without that alignment, you risk not having full visibility into who supplied what and where it ended up. This becomes vital for accountability and in case of recall.

 

Solution: Connecting your end-to-end supply chain within a single system will help you alleviate this issue. You’ll be able to plan packaging work orders split from different bulk locations based on quota arrangements and create work orders from bulk locations based on products’ batch sizes. That way you’ll always have clear visibility into your supply chain operations.

 

These are just a few of the life sciences supply chain pain points. What other supply chain challenges do those of you working in this space have to overcome? Let us know in the comments area below. Don’t forget to check out the first blog in this series on consumer electronics supply chain pain points and come back to see what other industries we profile.

 

The post Supply chain pain points: Life sciences appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Alexa Cheater at http://blog.kinaxis.com/2017/05/supply-chain-pain-points-life-sciences/

by Melissa Clow

This blog is part of a video interview series. Check out the video below as well as links to other supply chain practitioner and Kinaxis executive interviews.

 

There’s no doubt that the digital supply chain is of great benefit to a company, but we need to look at the world of social media to learn how to maximize use of digitalization, says Trevor Miles, vice president of thought leadership at Kinaxis.

 

Many companies today need to lift a lot of data from multiple data systems if they are to create visibility across their entire supply chain. But the way they go about it is less than optimal, says Miles. “It’s my firm belief that we are only going to make maximum use of digitalization if we start differently.

 

We need to look at the younger people and understand how they use digital media in their everyday lives. We need to learn from them as a way of working, rather than imposing on them things that we’ve been doing for the last 30 years.”

 

In fact, Miles believes executives should rethink how they approach use of a number of technologies and processes. Sales and operations planning, for instance, is merely a “Band-Aid,” in his view. In the past, the commercial and operations sides often had no way to collaborate or even communicate effectively. S&OP was thought to be the answer, but Miles says it’s little more than a “coordination function.”

 

RapidResponse enhances traditional sales and operations planning, he says, because it gives continuous S&OP. “You can ask it what the current state of things is, you can understand what the mismatches are, and you can bring a group together inside RapidResponse to actually correct things.”
He acknowledges that many decisions made in “classical S&OP” still need to be made. “But how quickly and repeatedly can you make those? With our tool, you can make them continuously. That’s the key paradigm shift.”

 

Paraphrasing Dwight Eisenhower, Miles says, ‘Planning is everything, the plan is nothing; meaning, the moment you walk out of the room there is a disconnect between what you planned and what you are able to do. RapidResponse enables you to pull that information up at any time, understand the disconnect and realign the entire supply chain. That’s where I see S&OP going in the future.”

 

Miles says that traditional functional silos continue to inform much of supply chain practice today. That has to change because the digital supply chain will never be fully realized until people achieve true cross-functional transparency. “This will take time,” he says, “but digitalization is actually breaking those boundaries and bringing visibility across the supply chain.”

 

Check out the other video interviews in this series:

 

The post [Video] Adapting supply chains to the digital phase of business appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Melissa Clow at http://blog.kinaxis.com/2017/05/video-adapting-supply-chains-digital-phase-business/

by Alexa Cheater

Consumer Electronic4 problems facing consumer electronics and what to do about them

Let’s face it. Working in supply chain is no walk in the park. Unless of course you’re walking barefoot and the ground is covered in razor-sharp pebbles that randomly change location. Then maybe it’d be comparable.

 

The fact is, while supply chain is big business for most companies, it also comes with a whole new set of challenges unique to its many processes, data requirements and functions. But depending on which industry you work in, your specific set of supply chain pain points could vary greatly. This blog series takes an in-depth look at some of the specific supply chain obstacles certain industries face, and how to potentially overcome them.

 

First up is consumer electronics.

 

Consumer electronics supply chain pain points

Relatively short product lifecycles (typically 6-9 months) with multiple feature changes throughout

 

This creates an atmosphere full of risk. With so many changes happening over the course of the lifecycle, you’re likely carrying extra inventory to make sure you have enough stock on hand to cover any part substitutions or adjustments. That means higher carrying costs and a greater risk to your bottom line if the product ends up as slow moving, excess or obsolete inventory.

 

Solution: Create multiple supply chain policies that reflect the changing lifecycle demand patterns, preferably using attribute-based planning. Adding in the ability for multiple what-if scenario simulation means you’ll be able to compare and contrast plans based on price curves, customer segments and/or new markets to see which produces the best result at any given time.

 

Multiple partners across a global supply chain network

 

With so many partners involved on a product’s journey from raw materials to delivered finished goods, you’re likely facing a situation with multiple and latent data sets. That’s not exactly the ideal for creating strong visibility across your supply chain. The result of this lack of visibility means you’re constantly re-working plans as updated numbers trickle in from your partners and suppliers. Plus, it leaves you blind to unexpected changes or unanticipated risks like a partner failing to deliver components on time. You won’t know the problem is coming until its right on top of you and already too late to compensate for it.

 

Solution: You have to plan as a single, harmonious end-to-end network. That means capturing all master and transactional data in one system – including details from your partners – and working from that single source of truth. This dramatically reduces the time it takes to gather current data and search for any exceptions or issues that need your attention. Make sure you can aggregate down to the SKU level to reduce production variability, fulfillment and transportation costs. You’ll also want to set control limits on things like international standards, customs requirements and other regulated compliances.

 

Integration speed for mergers and acquisitions

 

The longer it takes to integrate data from a newly acquired company, the slower you’ll see the payoff. As mergers and acquisitions often play a vital role in company expansion in the consumer electronics industry, it’s also likely you’re looking at a host of disparate enterprise resource planning (ERP) systems – and as most people who’ve worked in supply chain will agree, they don’t typically play well together.

 

Solution: Be ERP-agnostic. The faster you can merge the data, analytics and planning logic of the new ERP system into your planning solution, the faster you’ll see the payoff of your investment. Ideally your planning solution can pull data and model the behavior of multiple ERP systems.  There are solutions out there that can lay overtop of your existing multiple ERP systems and automatically pull all the data in to a nice, clean package where you can manipulate it, analyze it and generally not have to deal with the headache of reconciling it all in spreadsheets. That will eliminate multiple data sets, greatly reducing your inventory and cost risks. Why? Because you’ll actually be planning with a complete, current set of data.

 

Balancing daily decisions happens at a snail’s pace

 

Every day is a new balancing act as you work diligently to find the right harmony between costs, revenue and service. But aligning them all means collaborating with co-workers, and sadly coming to a consensus on where tradeoffs should happen isn’t always their top priority – or even their twentieth. It becomes a battle to get everyone on board, after all, someone’s likely conceding in an area they wish they weren’t. That slows down the entire decision-making process and weighs you down when trying to respond to changes in supply, demand or capacity.

 

Solution: Bring in lots of baked goods – particularly ones involving chocolate. And when that doesn’t work, get down to brass tacks and show them how each of the prospective tradeoffs stacks up against your company’s key performance indicators. That way they’ll clearly see a decision’s impact on revenue, profitability, service, margin and costs. With the numbers clearly in front of them, they’ll have an easier time deciding on the right course of action, and you’ll be able to implement changes faster. Things will go even quicker if you have a supply chain solution in place that allows for real-time cross-functional collaboration right within the platform. No more clicking the refresh button in your email inbox to see if they’ve responded yet.

 

These are just a few of the specific consumer electronics supply chain pain points. What other challenges are you facing in your supply chain? Let us know in the comments section below.

 

And don’t forget to check back for the next blog in the supply chain pain points series.

 

The post Supply chain pain points: Consumer electronics appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Alexa Cheater at http://blog.kinaxis.com/2017/05/supply-chain-pain-points-consumer-electronics/

by Melissa Clow

Gartner S&OP SOD Magic QuadrantIt is with great pride that we announce Kinaxis® has been placed in the Leaders quadrant of the recently published Gartner Magic Quadrant for Sales and Operations Planning Systems of Differentiation.

 

Gartner defines a sales and operations planning (S&OP) System of Differentiation (SOD) as a software solution that supports a Stage 4 or higher maturity S&OP process. According to the report, “Leaders have a strong vision for their S&OP SOD capabilities. They recognize the role they will need to play in enabling the move toward multienterprise horizontal planning allied with vertical integration that links strategy to operations and execution. They are looking at developing analytics to support probability-focused end-to-end predictive and prescriptive analytics to support profitability trade-offs and supply chain design and configuration capability.”1

 

Because of our unique ability to provide concurrent planning, Kinaxis RapidResponse® is an ideal solution to take companies through the various stages of S&OP maturity. We believe the next revolution in supply chain performance can only be achieved by realizing the speed of cross-functional decision making. As today’s press release indicated, our goal is to advance our customers’ S&OP processes from early stages through to Stage 4, and beyond, over time by taking advantage of all full capabilities in our single product.

 

Ultimately, with a sales and operations planning system of differentiation, we believe companies should achieve:

 

  • tighter integration between supply chain and the commercial organization
  • tight alignment of S&OE meetings with the midterm plan generated in the monthly S&OP meetings in order to support profitability-based short-term trade-offs
  • consistent metrics considering the internal and external trade-offs required across the extended supply chain
  • successful management of the trade-offs in the midterm planning horizon within the S&OP process, covering the three to 12 month terms and moving beyond the current quarter
  • synchronization of the cycle of the S&OP process and the time horizon with the annual business plan and budget cycle

Managing S&OP from a single application enables companies to make better tradeoffs across competing metrics quickly and to make value-based decisions for the enterprise collaboratively – both at the time of plan development and when the S&OP guidance is violated due to unplanned events.

 

Find out more about our  S&OP solution and the outcomes Kinaxis customers have realized with RapidResponse. You can view the 2017 Gartner Magic Quadrant for Sales and Operations Planning Systems of Differentiation report in its entirety here.

 

1 Payne, T., Magic Quadrant for Sales and Operations Planning Systems of Differentiation, Gartner Inc., May 1, 2017

 

Disclaimer: Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

 

The post Kinaxis Positioned in the Leaders Quadrant of Gartner’s Magic Quadrant for Sales and Operations Planning System of Differentiation appeared first on The 21st Century Supply Chain.

 

 

Originally posted by Melissa Clow at http://blog.kinaxis.com/2017/05/kinaxis-positioned-leaders-quadrant-gartners-magic-quadrant-sales-operations-planning-system-differentiation/

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