I interviewed Charles Wehlage who discussed Speed of Supply Chain: Know Sooner, Act Faster.
Please provide a brief background of yourself
Sounds good. So, my background, I’ve been with Kinaxis, three years. I’m a resident in San Diego and my role is what’s called an Industry Principal. Vice President Industry Principal. What I mainly focus on is really the pre-sales area, getting the sales folks into the door and using my network, my contacts to do that. But then also, once you’re there, is to really look at what Kinaxis does and what’s the value into a business. What’s the benefit going to be received? And really focus on not just the business case for that company,but the organizational--the process changes that are coming with, what would be as an end to end type supply chain and non-functional solution that goes across all their network. A lot of that is in the process, you know, design a process strategy as well as the Kinaxis solution.
Prior to Kinaxis, I never worked in software. This is my first three years. My background is running supply chain. I started in my career in Apple Computer. Worked various roles in Apple Computer specifically in Pacific operations. Spent three years in Singapore doing new product introductions, came back and went over to a company called EMC. EMC is a data storage company. I did IT work, I did the creation of what’s called a Portfolio Group or a Business Integration Group of IT. I did mergers & acquisitions when we bought the Data General which was our first acquisition, did a few more. And then went into a supply chain and really focusing on outsourcing activities for EMC. Went over to a company called Bose, the speaker company.Worked on European outsourcing as well as supply chain optimization and did--focused a lot on you know, kind of recovering a—an SAP project that was going on at Bose. Went to a, you know, three years AMR research. Ran a high-tech practice. We sold that to Gartner and from that, I’d say as my wife wanted to be where it is sunny, no longer snowy and cold and so I came out and did--I was VP of supply chain at Sony Electronics for a couple of years and then that led me towards Kinaxis, so that’s my background.
Thanks. Can you talk about the speed of supply chain? Why is it important?
So, I think it’s getting to a point where we have added so much complexity into the supply chain by outsourcing, by partnering and stuff like that and what we’ve been left with is a functional type of structure for what’s considered a complex network. When I say functional, we plan, buy, make, deliver. We have organizations around there. We have tools around there and we have processes built around there and when you outsource make or you partner through distribution or planning is not in the cloud or something. There’s different processes now that have to be enacted that are leaning on these functional type solutions and so the speed now is incredibly important because what you’re doing now is you’re working not only with the a disparate group instead of systems, maybe a process that isn’t fully baked global complex and now you’re doing with a bunch of partners in various parts of the world and that speed has significant, you know, return because consumers now control, you know, especially in high-tech they control the purchase decision. They have access to a ton of information to make that decision. And the supplie chains now have to react even faster so not just a monthly S&OP but a weekly, not just you know, within the--at the day but within the hour as far as returning you know, sort of answers that’s winning right now, that’s winning. Revenue, sales orders that’s winning from an inventory carrying cost that’s winning from a service perspective so that ability to respond, not just from a risk in supply chain but to the consumer if needed needed in this day and age.
Can you talk a little bit about the how. How can this be done better?
We have this thing called 'know sooner act faster' here’s our mantra. Yeah and act faster is very easy concept. You know, you get a sales order, you respond faster. You have a purchase order, you know, that’s in the--a shortage or material short, you’ll act faster. You know, the faster you can go, the better business benefits so it’s a very easy concept to go after, you know, whether it’s lowering you’re safety stocks because you’re not--respond faster or whether you can make decisions on freighting you don’t incur. You know, Air freight. Those types of things, if you just act faster when there’s a disruption, you’re going to have a business benefit, in terms of profit margin you know, opportunity.
That is what I’d say is the core of what it is. The challenge is people have various sets of data and stuff across and even modules that have middleware cannot do that so this is a solution for an opportunity that’s out there. You can’t have 10 suppliers and expect it to go faster and have 10 in one day. They still have to go back to their disparate system’s run what would be on excel or systems you run their analysis so it’s not just about your people acting faster or making you know, 10 phone calls a day or you know 10 CPFRs a day. There has to be something that’s stretches across at a data layer, that allows you to look at these decisions you’re making at a high level and see what the corresponding impact is to the second or third tier of a network or the second or third tier of a network has a supply shortage. The alerts at the higher level, at the brand or at the retail downstream that this is going to have an impact and right now, it is limited as far as they build what we see is excel. Massive amounts of excel there out there that people try and put this all together or at least try and get this together. The problem with that is multiple sets of numbers, but the real problem is the speed. The speed which you can get the answer just isn’t there and so it’s a huge problem. It’s what Kinaxis steps into but it’s a huge problem. You know, as far as the ability to just act faster. There’s a desire for it but it’s a –but I’d say the solution-driven changed not just a, you know, a better process or reorganization.
Do you have any examples of success that you could share?
Avaya and Schneider who came to our conference last year in October and presented. Avaya has some significant benefits that are actually coming and speaking in a couple of conferences. They mentioned two types of benefits. They used to spend a lot of time collecting and gathering data you know, and not enough time really doing proactive planning and they’d pretty much inverted that process with Kinaxis. Now, you know, we lay over a ton of their network. We pull data and allows their planners to be much more productive. It allows them to say, “I’m not going to spend time, hours of time, gathering, you know, and analyzing data, and searching for the exception. I’m going to work on the right exceptions and so massive improvement and a plan of productivity, the obvious, you know, as far as availability and as far as cost are there.”
But they also pointed out their planners now are much better engaged. They took this retention study, and they looked at it not just from a business perspective but also from an employee satisfaction perspective. These planners are no longer gathering data from BIs and excel and dump them all in and spending hours searching for exceptions. They’re working on proactive planning. They’re working on scenarios, simulations and trade-offs and they feel much more engaged in what they’re helping the company in a sense of, not just you know, bird dogging or chasing things as far as trying to solve a problem so that’s one.
Schneider had a huge network they had what I’d say is , nearly a hundred--over a hundred different instances of an ERP transaction system. I’ll--be it through maybe acquisitions and stuff and they literally could not stick that all together. They didn’t want to wait for the,you know, the endless journey to get to a single instance. They said the transaction systems are separate, the planning that we need to do needs to be on you know, on a--agnostic to the ERP that stitches all together and so what they did is came to Kinaxis and we stitched together all those ERP transaction systems. Allows them to run a global ERP across their suppliers, across their customers, across this really complex, you know, desire to get a network of a hundred and some ERP systems and now they don’t have to wait for all that consolidation to occur. They can still work on the ERP consolidation from a transaction benefit but from a planning perspective, they now can have access across their network and that has a big benefit to them, leveraging suppliers, leveraging capacity, leveraging you know, inventory and sales orders and such. Now, they can make what they deem as much better decisions on margin, much better decisions on you know, where best to place some of their assets.
About Charles Wehlage
VIce President, Industry Advisor, Kinaxis