Skip navigation
2017

I interviewed Christoph Szakowski who discussed Change Management in Logistics.

 

 

 

 

 

 

...to you today, Christoph.Looking forward to hearing your views on change management in logistics. Can you first provide a brief background of yourself?

 

Sure, Dustin.And thank you for inviting me. My name is Christoph Szakowski. I am an international logistics manager with a multicultural background. I was born in Poland, relocated to Hamburg and educated in Germany with an MBA. So I have been working 18 years in the logistics industry in different roles, as corporate manager, interim manager, consultant, entrepreneur. I was able to manage people in a broad range of logistics firms in mid-size and large business units across Europe and Asia with the focus on the C and CIS Region and the emerging markets.

 

First question then is can you share your experience connected to change management?

 

Sure. Change management has been actually very often the mission I was interested with by large third-party logistic companies, companies representing B2B spectrum in general. So I was able to gain experience, for example, as CEO of a [inaudible 0:01:43] company in Poland in a restructuring project, as C-level executive in one of the world's leading logistics providers in Russia, as an interim chief operating officer in a mid-size logistics company, operating in 16 countries in the Euro-Asia region with strong exposure to the so-called New Silk Road.

 

The experience I have been able to gain can be summed up in two groups of tasks. The first group would be assignments connected to turnaround of a company. The main point is to ensure the company somehow goes back to normal after weak performance, client losses, or other troubled situations. Or the second group of task connected to change management are expansion roles where the goal is to develop, connect, and motivate teams across the whole organization, show vision and leadership, and integrate parts of a company into larger networks or units.

 

The main point there is business development and growth.

 

What are the necessary steps to start a change process?

 

I believe, first of all, the key stakeholders of the company, which is the top management, the advisory board or consultants, interim managers, in case they are [inaudible 0:03:52] for such as role as well, they simply need to agree on the necessity and the reason for the change management. This is crucial, especially in the very fast business environment nowadays. In a business environment with volatile markets and strong competition and sometimes this competition is coming into a new line of business with revolutionary business models. So that is the first step. That's the alignment on top level.

 

The reason why and to the target which we want to achieve with organizational change management in the logistics business, I would say a target for one year after starting the initiative is sufficient. So that first step.

 

The second step is already to communicate your plan, your milestones, and the advantages of the change processes to your teams and to your people. That is a very critical point. In the time of talent shortages, you need to lead people with professional and trustful communication and explanation of change. You need to keep your best managers around you and absolutely committed to the change. From my personal experience, I can say that the successful change assignments — whether this has been in Russia, Poland, or across the C Region or across continents — they very much succeed or fail with the way of management communication.

 

The first step you need to start with, from the point of view of the company, is to consider opportunities you might have with outside consultants or interim managers coming in such a change process. Those are obviously neutral and independent. They have an independent perspective on the change process and its implementation and results. And they possess market knowledge which really can help you benchmark your company against competition. So this is the first step, and this first step is an option, obviously.

 

But large companies and mid-size market players, they might consider those investments in outside experts are a very good decision at the end.

 

What about organizational change management for logistic companies?

 

Talking about logistic companies, I think there are three main areas they need to focus on during change management. First of all, the question,will the change management lead them into new markets, niches, or new solutions [inaudible 0:07:30] overland transpiration, multi-modal transportation, etc? So the question, will the change help the company really to obtain better position than their competitors?

 

Very important also for logistics companies, the following questions... Does their plan change have an impact on their business model? Business model – so asset light or asset heavy – in case yes, I believe they need to check with the overall strategy and vision as you cannot simply change your business model very fast, or it is very expensive with strong impact on your financial figures. And the kind of tracking of your what is your [inaudible 0:08:27] for final customers.

 

It’s also very important for logistics companies is to consider the availability of top talent of managers and specialists but not only for the change process itself but also for the time after this change is realized. So to give you an example...

 

If the company would like to be much more technology driven, the question is, are there enough experts to pull it off then, or if the company goes to emerging markets, are managers on board to lead the whole move successfully in the emerging markets?

 

What are some of the mistakes that companies make and how do they avoid them?

 

I believe they might be very specific mistakes, depending on which company we're talking about. But I would like to underline that a lack of resources and capacities is often simply the show stopper. And sometimes also companies values might not allow a company to make a radical change. I suggest always to companies top people to consider the question of resources, capacities, and companies’ values before any big change process.

 

Do you have any success stories to share?

 

I believe in general the success stories and implementation in different projects show that companies are coming out as more effective or better organized or more customer oriented or more innovative of the change processes. For example, I was honored to lead a change process in a very challenging C and CIS markets,one of those happening in the largest European transpiration network. So between European countries in Russia, for example, and this has given me lots of experience for new roles as a change agent in a broad spectrum of logistics task worldwide. So it has been about the success stories from my point of view.

 

Thank you for sharing today, Christoph.

 

Thank you very much.

 

 

About Christoph Szakowski

 

 

 

 

Christoph Szakowski

 

COO / Logistics /SCM/General and Interim Manager in 20+companies/DACH, CEE,CIS, Asia, Emerging Markets

 

LinkedIn Profile

I interviewed Stefan Reidy who discussed Supply Chain Risk, Visibility, Integration.

 

 

 

 

 

Can you provide a brief background of yourself?

 

I was a consultant at IBM. At that time, we had an internal organization called ODIS, which stands for On Demand Innovation Services. The idea was to bring innovation faster to the market by working closely together with research. It was consultants and IBM research working together. After 9/11 there were new regulations coming from the US government about cargo monitoring. We started to look into how we could address these regulations, and new challenges, to make the supply chain more visible, more secure, more efficient.

 

We started with three researchers, and then we added people — consultants, software developers, etc. For various reasons, IBM stopped the journey in 2007. I left IBM and founded the company Arviem together with two other partners. Since then, we have been offering real-time cargo monitoring services in the market.

 

Could you define what is supply chain risk visibility and integration?

 

It's a broad topic. Currently, if you look at the global supply chain, and focus, for example, on container shipments; there are over one hundred million shipments worldwide taking place every year. There are many incidents happening and it is obvious that, for shippers who actually carry all the risk, the visibility is not given.

 

So the parties suffering most from these risks from “black boxing” in international or global supply chains, are the shippers. This is where we wanted to bring in some benefits, a solution, by using new kinds of IoT technologies. The technology brings in visibility by detecting or revealing data at the edge of the networks.

 

We detect where the cargo is and what's going on. We find out how the is cargo doing and whether there are any shocks. We can find out if there are any kind of temperature, humidity, or other factors out of the ordinary. We analyze the data in combination with some other data streams. You could also call this integration. We combine it with other available data but also in direct connection with the cargo that is out there in the network.

 

We think this combination can bring in the additional required visibility.

 

 

How is this visibility into the supply chain done in practice?

 

We have three components at Arviem. One is what I call the sensing component. It is a piece of hardware, an IoT device that collects the data and transmits the data in real time to what I call the analytics component. This second piece of software is what collects the data from the devices out there, combines it, as I said before, with other data streams; for example, weather data, risk parameters from all the companies, etc. Based on business rules, it then defines actionable information out of it, which could be a report, or a notification. Then, based on the collected data, the “big data”, we then create historical and dynamic risk profiles.

 

The third component is a service. We have an operations department, which makes sure that the devices are always operational, that they arrive on time, at our client's site. When the shipment is over, we pick them up again. We ensure all the system are working properly, so our clients basically have nothing to do. They pay per use, but they don't have to do any investments. They don't have to do any admin work. It's a full, end-to-end service operated by us.

 

What challenges do you have to face when doing this?

 

Let's say we are doing international shipments. Because ours is a new business, it's a kind of disruptive business model. For example, these devices are not known by several Customs offices worldwide. We don't have regulations or approvals which are globally accepted. So if you come in to one Customs office, it might be accepted. Not a problem at all. If you go to the next Customs organization, then suddenly they say, "We don't like these devices," or, "What is it exactly? Give us all the details." So you first have to go through an approval process. This can slow down the ramp up of our service in some countries.

 

The other aspect is, again, because it's kind of a disruptive service, clients will have to change the way they do business. That is sometimes a time-consuming process because the clients themselves have to definite their business model differently. They have to change their processes. They have to have new KPIs, and that's sometimes something that you cannot do overnight.

 

However, from a service perspective, it's basically our intention to make the service easy to use, simple set up, and easy going.

 

Can you share any success stories or some examples of success?

 

A lot of companies are not yet there where they say, we are not allowed to use them as a reference. But one of the companies, it's one of our very first and biggest clients is Nestle. Yes, we achieved improvements which are quite significant. I'm obviously not allowed to mention any data, etc., but they achieved major benefits.

 

Do you have any final recommendations?

 

I think if you look into supply chain and logistics — I feel this is going to be one of the next major industries that is going through major changes. Logistics has not changed over the last 100, 200 years. Now with the new technical possibilities, with IoT, Big Data, and Blockchain, this industry will go through major changes over the next few years.

 

The changes are not only for us as solution providers in this game, but also the clients, meaning the shippers and logistics companies. They should be prepared to be open enough to start pilots and to execute new kinds of business models.

 

Thanks for sharing today, Stefan.

 

You're more than welcome, Dustin. I hope we will talk soon again about another topic.

 

 

About Stefan Reidy

 

 

 

 

Stefan Reidy

 

CEO Arviem AG | Smart insights for supply chains | The leading Swiss real-time cargo monitoring service provider

 

LinkedIn Profile

I interviewed Frank Arzenti who discussed Supply Action Management.

 

 

 

 

 

 

Today we're speaking with Frank Arzenti, and we're going to discuss supply action management. Frank, before we start, can you provide a brief background of yourself?

 

Sure. I am the director of supply chain and material support for a provider of professional development and material support for [inaudible 00:00:27] based learning and teaching focusing on STEM education — Science, Technology, Engineering, and Math. My role is that within our distribution center, we build science kits. These kits are sent to schools throughout the state of Pennsylvania and beyond, but mainly our focus is in Pennsylvania. These kits are sent to, generally, elementary age type of students, and they are leased to the customer and returned pretty much on a quarterly basis. School districts really don't have a place to store this material, nor do they want to refurbish it, nor do they want to replenish it. So to keep our costs down, and to keep their costs down, we lease these science kits to them on a quarterly basis.

 

My role is to really direct the flow of materials, from identifying what needs to be purchased, to sourcing it through our vendors, the receipt, and then through our warehouse management system so we can allocate inventory to the science kits that we ship to the school districts.

 

What kind of challenges have you faced doing this?

 

Internally, we have an open source ERP system that identifies demand based on any parameters that we like to do, whether it was state driven or whether it was class code driven — class codes meaning consumable items or durable items. Those are the ones that get returned,even at the kit level. So we had our parameters that we can choose. And it was pretty flexible, but it did not really provide all the information that was work-in-process nor did it identify those materials that were scheduled to be returned within that time frame that we were analyzing.

 

So there were several reports that we had to look at on a daily basis. You probably felt like being an air traffic controller where you had six screens open on six computers and trying to bring all this information together. So knowing that the data was there, we worked with our business technology department to try to group all this information, put it on one easy-to-understand, easy-to-process report, which has been very successful.

 

So we reduced our processing time of the MRP from probably four hours a day to about 30 minutes a day, and it's really been successful for us.

 

What would you say are the key ways to improve supply chain action management?

 

That was one of it because I think that our turnaround time has gotten so much smaller. Demand, we need to be almost like the Amazons, where we can turn inventory around almost at a moment's notice. And we really didn't have that luxury of trying to be able to build a timeline where we could say, "You could get this inventory in six months," which was just totally unreasonable.

 

Given this opportunity to go ahead and process the MRP, see our demand, create and purchase requisitions, convert them to purchase orders, and get them into the vendors hands was critical for us to maintain a competitive advantage.

 

How do you see supply action management changing in the near future?

 

I think it's just going to become more and more competitive. I think Amazon is starting to set the standard where “call today, it's on its way” and almost being delivered today. I think that what our challenges will be is to be able to identify those vendors that we work with on a regular basis, make sure we establish some really great relationships with them, forecasting it properly,so we would have that opportunity not to overbuy inventory but just to have that correct inventory at the right time in the right quantities, so we can get them moved out to our customers at a rapid pace.

 

Great.And thanks for sharing today, Frank.

 

You're quite welcome, Dustin.

 

 

 

About Frank Arzenti

 

 

 

 

 

Frank Arzenti

 

Director -Supply Chain and Material Support

 

LinkedIn Profile

I interviewed Wade Winters who discussed the Supply Chain for Restaurant Industry.

 

 

 

 

 

 

Today we're speaking with Wade Winters, and we're going to discuss supply chain for the restaurant industry. Wade, can you first provide a brief background of yourself?

 

Sure, Dustin. Originally, I worked for Hilton Hotels for about 15 years, ran supply chain both at the hotel level, regional supply chain offices, and then eventually at the corporate office where I was responsible for establishing supply chain for all food and beverage for all of the Hilton brands. Then I was with Au Bon Pain. I was the VP of supply chain for Au Bon Pain for about nine and a half years and ran the full supply chain everywhere from working the manufacturers, distributors, franchisees, and obviously, the restaurant level.

 

So for the past three years I've been with Consolidated Concepts, and we are supply chain specialists and consultants for restaurant chains. So basically, our goal is to help them reduce costs, continue to support their growth, and overall, just add value to them from a supply chain perspective.

 

Can you talk about the how the supply chain in the restaurant industry is different or how you look at things differently?

 

Absolutely. The restaurant industry is, I think, different other industries in the fact that you're dealing with a lot of perishable items. You're dealing with a lot of inconsistencies in terms of demand. There's a lot of things that are related to sales and forecasts, unknown parameters that you have to plan ahead for and have contingency plans for.

 

A lot of things that we also evaluate from a supply chain perspective is products that are being used, or alternatives that might have a better fit for the application. One thing we always like to make sure, when we work with our clients, is understanding what they buy, why they buy those items, how those products are used, how are they processed and utilized and then eventually presented to the customer. Until we know all those steps of the entire supply chain, we can't really help them and understand where there might be opportunities to reduce our costs, either through a lower cost for the product itself, or there are other ways to save money and reduce costs, whether it be improved yield, reduced labor... And we even go as far as looking a food safety risks, because there are opportunities to help a restaurant company by taking some of the labor out of the kitchen and outsourcing that. And there's a lot of advantages related to that.

 

How do you evaluate the supply chain beyond just cost and cost savings?

 

Similar to what I was mentioning earlier, we always want to make sure we don't just focus on the cost per case of a product because there are so many variables that go into that. There's yield, there's quality, there's labor. So eventually, what we want to do is dissect the entire process. I'll give you a perfect example — buying a case of commodity French fries. French fries are typical on all menus for most restaurants in the United States. So instead of buying just the lowest-quality French fry, we want to show our clients that they have to use more product per serving when they use a lower-quality product sometimes. And it has to do with yield and filling up either the plate or the container that the French fries are going in. So if they paid a few more bucks for a case for a higher-quality, extra-fancy potato that reduces that amount of product they have to use per serving, their cost per serving goes down, and the quality goes up.

 

There are perfect examples of that and many other scenarios. I'll give you another great example. Right now avocados are crazy expensive. It has a lot to do with the demand and supply, and they're almost $100 a case right now. So the first thing we want to evaluate is, an avocado, really, between a grade one and a grade number two avocado is really the exterior of the avocado — only blemishes and scaring on the skin. The reality is nobody shows the customer the outside of the avocado. It's only the fruit inside.

 

So the first thing we suggest to a client is switch from a grade one avocado to a grade two avocado, and save yourself about three to five dollars a case.

 

Then the other variable is the yield per case of avocados. Most avocados are 48 count, which means there's 48 in a certain particular size case. If they switch to a 60 count, they actually get a lower cost per usable pound of fruit from the avocado than if they went to a 48 count. Now granted, you're going to have to open up more avocados, so there's a little more labor involved. But it's offset easily by the lower cost per pound on the avocado.

 

So these are things that sometimes restaurants don't really pay attention to. They're focused on what is the best price I can get for the product that I've been using for 100 years instead of realizing there's other ways to save money by just altering a product that might be a better fit for the application without impacting the customer's experience.

 

What do you see for the future of supply chain for the restaurant industry?

 

That's a very interesting question because I'm actually at a conference right now that talks about what's happening in the industry, the type of competition that's taking place, the Amazons of the world, technology, how that's affecting the future of restaurants, the fact that Millennials now are outnumbering every other age group and what their needs and demands are. There's a lot of moving parts right now.

 

What's really important is that a restaurant concept is able to make adjustments, and if they can't make adjustments, they won't survive. But it's really also defined by what is their niche. From a supply chain perspective, that goes hand in hand. So if you're not able to support the concept and the direction that the restaurant is going from a supply chain perspective, they won't survive. And part of the thing I want to talk about there is expansion of a restaurant chain.

 

Usually when they're in one market, and they have volume, and they have good following of customers, the supply chain is rather easy. They probably have one distributor, and they can leverage their buying power. But when they start extending into new markets, it's a whole different ballgame. So to really understand and plan ahead, make sure that the growth is consistent and can be supported from a supply chain perspective is very important. So again, those are the other things we work with our clients on, is making sure they're strategic about their growth, that they do it intelligently and economically. Because, again, supply chain is cost to the bottom line. Every dollar you save is to the bottom line, and that reduces the amount of sales you have to have on the front end to offset that.

 

So that's how important supply chain is, for any company in any industry. I thank that's why more companies nowadays are realizing that and investing in proper talent, resources, technology, to make sure that costs are being managed appropriately on that backend.

 

Thank you for sharing today, Wade.

 

Absolutely.

 

 

About Wade Winters

 

 

 

 

 

Wade Winters

 

Vice President Supply Chain at Consolidated Concepts

 

LinkedIn Profile

I interviewed Niels Van Hove who discussed why mindset matters for supply chain and S&OP.

 

 

 

 

 

 

Can you provide a brief background of yourself about why mindset matters for supply chain and S&OP?

 

Yeah. Of course, Dustin. Good to talk to you too. My background, I've been in supply chain for about 20 years, worked across many different countries, about 12 to 15 different countries, as well online organization, [inaudible 0:00:30]. I'm also an accredited Mental Toughness coach and founder of Mental Toughness Online and also author of self-help guides on mental toughness and illustrated a children's book on mental strengths.

 

My first question is why do we have to move on from the traditional S&OP discussion to a more looking at how it can support the company culture and team effectiveness and meaning?

 

Just a bit of context there... I've always wondered, my whole career, why it's so hard for people to work together. S&OP is trying to make people bring together. But often, is the process is implemented, it is still hard to make it work, and often, that's because of the behaviors and the mindsets of people.

 

So I actually think, and often we say, S&OP is dependent on the company culture. My premise is we have to use S&OP to influence and change the company culture for the better.

 

Can you talk a little bit about how to implement this and do it effectively?

 

Yes, of course. I wrote about that in my Foresite articles as well. But it's about understanding, first of all, what are effective behaviors for S&OP, but you can extend it a little bit. Behaviors are effective for S&OP. They're also good for employee well being and performance. So actually, it's a double whammy. If you define the right behaviors to support S&OP and start incorporating them from the executive level in S&OP and measure them and ask feedback on them, then you start to influence your company culture. S&OP need to have a certain amount of maturity, of course. First you need to have a level of maturity. So S&OP is seen as an important business governor's model. Only then it can start to influence the company culture. But once you have that maturity, and you define behaviors, and you commit to displaying those behaviors through S&OP, you actually influence the company culture for the better, which in return, improves your S&OP.

 

Do you have specific examples that you could share of some success?

 

Yes, of course. Mainly, I work myself on workshops that improve trust. So with the leadership team, what define what types of behaviors improve trust and trust improve S&OP, of be course, but it also improves psychological safety for employees, which improves their performance but also wellbeing.

 

So with a leadership team of 40, the top 40 leaders, I did a workshop to define how can we improve trust and collaboration. And we distilled a couple of key themes, behaviors, which the leadership team committed to, to improve trust. And we started our feedback on that in the S&OP meetings. So slowly but surely, more and more of those conversations were starting. And that started to impact the openers of the meeting and the willingness of people to provide feedback and challenge each other.

 

Do you have any final recommendations?

 

Well, my recommendation is really to start thinking beyond traditional S&OP, which has been around for 30 years. I still hear a lot of talk about forecast accuracy and those type of measurements, which are great. But if we want to engage the real executives, the real senior leaders, we have to give them more meaning to the meeting, to the S&OP cycle. If we can provide a means to influence the company culture for the better, the employee engagement and wellbeing for the better, we define a whole new area where S&OP can be involved and can influence a business, which will increase executive engagement.

 

Thanks for sharing together, Niels.

 

Thanks, Dustin.

 

 

About Niels Van Hove

 

 

 

 

 

Niels Van Hove

 

Coach | Consultant | Author

 

LinkedIn Profile

Website

I interviewed Scott Lowther who discussed the biggest mistakes that he has observed in supply chains over the last 20 years.

 

 

 

 

 

 

Today we're speaking with Scott Lowther, and he's the founder of Supply Chain Alchemy, and the topic is the biggest mistakes that he has observed in supply chains over the last 20 years. Scott, can you first provide a brief background of yourself?

 

Yes, I can, Dustin. My background started off as actually a chemist. I i progressed through a couple of small companies and ended up at Mobile Oil where I started to get a wider view of what goes on inside a company, particularly around supply chain, production, and procurement. And I got a bit of an interest. So after being there for a bit over 10 years, I fell into supply chain consulting with one of the big five. After working with them all around the world, I went and became a supply chain manager at a large manufacturing company. And then around 2004, I went out on my own, effectively consulting around, predominantly, manufacturing, but it's been everything from mining, financial services, [inaudible 0:01:07] the military and defense. So it's been quite a variety of roles and areas of supply chain experience.

 

Can you first talk about the importance of people?

 

Yeah. I honestly think that probably the greatest asset or benefit that any company can get is if they get their supply chain working properly. But I find that supply chain itself is actually quite easy. It's generally the people that cause the biggest issues when you're trying to get your supply chain functioning properly. And one of the things that I’ve noticed is that supply chains that report into a functional area — so they're reporting to sales, or they're reporting to production — tend to have their planning skewed towards that department. And it's really critical that supply chain actually is its own department, reporting on, going through to the CEO. And the reason for that is that the planning process can be independent of any functional area. And that's one of the things that I've seen in a number of organizations, that you see the, I suppose, the planning skewed towards a particular department, which is not necessarily in the best interest of the entire company.

 

The other thing I've seen is really the type of people they hire. I notice that a lot of people, if you're FMCG, and they're trying to hire an FMCG job, they will actually go out and specify that you must have experience in FMCG. One of the biggest benefits I've seen to companies is, when they actually go outside their area or their own industry, and they start to being in some fresh ideas... Because you find that what is common practice in one industry, that if you transfer that to another, can actually become best practice. And if you keep doing the same thing, you're not going to actually bring in fresh ideas, and you'll end up just doing the same thing over and over.

 

The other thing I've noticed is people that come straight out of university with a supply chain degree know the theory back to front, but they don't have that practical application to actually implement. So they don't understand what are the implications. And I find that every industry has its own slight nuances that sometimes you have to adapt the theory to suit what is actually going on. And it's really critical that you have some business knowledge that can go and feed into the supply chain. And I think that's really critical, and I've seen consulting, particularly,where they'll come in and say, "This is what you should do," and yet, practically, there's no way that that could actually be implemented.

 

So they are just some of the things that I think around people are really critical.

 

Can you talk about the importance of process?

 

Process — I think it's really important they really don't understand the interactions around their components that make up the supply chain — from sales all the way through planning through to execution. So it's a little bit like holding a balloon in your hand. And if you poke it in one side, there's going to be a bulge that appears in another part of your hand. And it's really important that people understand what are those interactions and that, if I do play with my inventory, what is it going to do? If I extend my supply chain by manufacturing overseas, what is it going to do to my inventory levels, my customer service levels, my forecasting.

 

All of those components seem to be lost when people just delve down into one little area. And I like to build flexibility into a supply chain. I see people that paint themselves into a corner by saying, "If I go buy this mechanism" — it's the cheapest at this point in time, and they build their entire infrastructure around it, and then when the market or the technology moves, they're stuck. And it's a really big exercise to dig them out of that hole.

 

I'll give you an example. We had one CEO come to me, and he said, "I want to do a customer survey and ask my customers what they want."

 

And I actually said to him, that's the worst thing you can do because customers hate it when you ask them what they would like, and then you can't deliver. Or, when you go to deliver, it actually breaks your company. It's really critical that you understand exactly what's going on so that if your customer says, "I want to do this," you either know what the cost of it is, and you know exactly what you can and cannot do. So that's really important.

 

The other thing is I find that, from a treatment of your entire supply chain, your connected supply chain, includes your suppliers. But I find that most businesses treat their suppliers as enemies, and yet they're a critical component to supplying your customers. And if you work with your customers and your suppliers, you can usually end up with a mutual benefit that benefits both. But I find it very difficult when, again, companies will treat their suppliers almost like the enemy in every little component or cost reduction they can get out of them, they will.

 

The other thing that I find when you're trying to work out your supply chain or develop the processes that are working around it, if you balance your supply chain... Because normally, when I go into a business, they're fighting fires. So instead of being able to concentrate on planning and executing, they're actually fighting fires with the customers, supplies, and getting things all out of control. So if you can bring your supply chain into balance, then focus on the high points that you can actually walk away with, it's a bit like the theory of constraints. If I've got a balanced supply chain, I'm not fighting fires. I can start to work on how do I improve things.

 

And they're probably the main things.

 

But the other thing I find is people often confuse soft with hard constraints. I'll give you an example.A hard constraint is there's 24 hours in a day. A soft constraint is we run our production over one shift. So people assume that it's a hard constraint, and they limit themselves instead of thinking outside the box. And that's probably the main things around process.

 

Can you explain what's important about technology?

 

Yeah. Sure, Dustin. One of the things that I find companies do is that they [inaudible 0:10:13] the latest fad, whether it be blockchain, whether it be getting things in the cloud. They don't really understand their supply chain first, so they're looking for a solution to solve their problems. And really, you need to concentrate on the fundamentals. Get your supply chain balanced. Work on those things, and then you'll find that technology, rather than just getting you into a hole faster, actually enhances what you're trying to achieve.

 

So what we've got to try and do is look at your people, your structure, get the processes operating properly so you understand the costs and everything that it impacts on your supply chain. Use technology to enhance that planning process and execution, and then look to behind the scenes a little bit like re-engineering your LEAN. You're looking to systematize and get rid of the human error aspect. So, in other words, re-type of get rid of all of those components where mistakes can be made.

 

So you're trying to make things as error-free as you possibly can, and a plain environment is really the way to go. And that's probably the critical things I wanted to get across, Dustin.

 

Thanks for sharing today, Scott.

 

 

About Scott Lowther

 

 

 

 

Scott Lowther

 

Supply Chain Alchemy turning the Lead in your business into Gold

 

LinkedIn Profile

I interviewed Michael Serwetz who discussed the Ethnocentrism Undermines Your International Business Goals.

 

 

 

 

 

 

Today we're speaking with Michael Serwertz, and we're going to discuss ethnocentrism and how it undermines your international business goals. Mike, can you first provide a brief background of yourself?

 

Yes, I will. First, I'm coming to you from Brooklyn, New York, where 100 nationalities live happily together, coexist happily together. But I have been traveling the globe for more than 30 years and more than 30 countries and done business on every continent on the planet. I've been present and involved on an executive level of many, many business deals, many, many negotiations. And that's why I've learned of the importance of ridding your company of ethnocentrism.

 

What is ethnocentrism, and why must it about eliminated from your business practices?

 

Ethnocentrism is basically the belief that are you all [inaudible 0:01:07]. That your nationality, that your position, or anything about you — your race or anything about you — is better than another. So as a Caucasian, you're better than a Chinese. As a Chinese, you're better than a Latino. Whatever.And that enters into international negotiations because of something that is called self-reference criterion. Self-reference criterion is how you see yourself as compared to others.

 

Whether it's in politics or business, ethnocentrism detracts from the goals — whatever they would be. I'll give you a real life example.

 

Some months ago, President Trump met with Xi Jinping of China in Mar-a-Lago. One of the topics they discussed was North Korea. It's clear from the situation right now that nothing of any consequence was accomplished at that meeting. And my interpretation of that is that President Trump was... His self-reference point was, "I'm the president of the United States. I invited him to this lavish place. And because of my personality and my character, he will follow what I want him to do."

 

On the other hand, Xi Jinping, being Chinese, just told Trump enough to end the conversation without having to make a commitment himself. Therefore, nothing was happening.

 

If, in this case — and that was a case of ethnocentrism on both sides. Ethnocentrism is not exclusively the property of any people or race. Every people can be ethnocentric, and if they had just sat down and gotten to specifics of what are we going to do specifically about North Korea rather than relying on a pat on the shoulder and a shake of the hand, maybe we would have had some progress right now.

 

So the same applies to business. Don't assume, when you go overseas, that because you are a VP or a C-level executive that your position and your wallet will get you anything except maybe a good meal. What they care about is what you bring to the table and how you negotiate. That's what's important — the specifics of how you negotiate. Who you are and as a president of a company or whatever doesn't get you what you want. In fact, it may detract from it because it will cause uncomfortable, awkward, or negative feelings.

 

So this is a great example, which I cited on my website. It comes from a book called Beijing Jeep. Beijing Jeep was written in 1989 by a journalist named Jim Mann. The subject was how Chrysler, which owned Jeep at the time, started to do business in China, or tried to start to do business in China in the late 1980's. Totally, the effort was a failure, and it was a failure not because the Jeep is not a good product, not because it wasn't something the Chinese people would have wanted but the way both sides — the American side and the Chinese side —handled the negotiation, because both sides did not take an interest in learning about or seeing how the other did business or thought or acted, or the culture.

 

So when you are planning for international business negotiations, what is really important is that you take a self-assessment of your own attitudes and you also examine carefully the attitude of your corporation, the attitude of your staff, and clean out any ethnocentric ideas or any ethnocentric practices from your business. Then you'll be able to negotiate straight on, and the other side will probably recognize that and will have to meet you in the middle.

 

Otherwise, you'll either cover complicate, or you will fail in your negotiations.

 

How can people contact you to learn more about how you can help in your business?

 

You can contact me through LinkedIn, or you can go to my website www.iSourcerer.com. Check out the articles there and then drop me an email or a note, and I will be glad to get back to you, and we can have a chat about what you would like me to help you with.

 

Thanks again for sharing today.

 

Oh, you're welcome. Thanks again, Dustin.

 

 

About Michael Serwetz

 

 

 

 

Michael Serwetz

 

Senior Global Sourcing/Retail/Marketing,/Strategy/Ops Exec,Team Leader. Me: Change. Simplify. Optimize. Lead by Example

 

LinkedIn Profile

I interviewed Sridhar Upadhyaya who discussed the Project Management - Perspectives from India.

 

 

 

 

 

Can you first provide a brief background of yourself?

 

Yes, I'm an electrical engineer basically with about 23 years of industrial experience largely in supply chain management.

 

Can you talk about your experience with project management? What are some of the challenges that you face?

 

What happens in India basically, managements are basically into public sector, private sector, and the timelines are not really properly managed, I would say. The customers, they give the order but then it goes into a lot of [inaudible 0:00:52] and then you end up having large inventories and these kind of challenges.

 

How do you deal with these challenges?

 

What we do is basically, we have got a certain way of project management, and I've been practicing this, as you know, the tools that are available such as Microsoft project management, Office and all these things. But, as I said, the challenge in India is, the projects, once they are... Like, for example, if I get a customer [inaudible 0:01:30], it doesn't always go as planned. Sometimes it gets stuck midway through, and we get stuck with the supply chain process.

 

So what we have done of late is that there are very tight pre-order negotiations with the customers and proper milestones discussions with the customers to ensure that the projects, even if it gets stuck, the suppliers and the supply chain end doesn't get affected much.

 

Do you have some examples you could share of how you've done that in practice dealing with the customers?

 

Yeah. What we do is we have a cross-functional team comprising of the sales team, the project team, the sales and order-processing team, and the supply chain team. And we have our regular interviews and feedback sessions with the customers. There's a regular meeting with the customers for the customers just to ensure that the project is going to track and giving feedbacks and taking feedbacks from the customers so that the project flow is not jeopardized.

 

Do you have any final recommendations on project management in India?

 

No. Most of the tools, what we have... Yes, we do have the project management tools, but these are largely, predominantly the software industry, but not in a manufacturing industry.

 

That's interesting. Well, thanks for sharing today on this topic. Did we cover all the points you wanted to make?

 

 

 

About Sridhar Upadhyaya

 

 

 

 

 

Sridhar Upadhyaya

 

Head of Supply Chain

 

 

LinkedIn Profile

I interviewed Carlos Nascimento who discussed the Evolution of the Supply Chain Discipline.

 

 

 

 

 

 

1. Please provide a brief background of yourself

 

Sure. I am a Production Engineer with post-grad in Business Administration. Born and raised in Sao Paulo, Brazil, have lived and worked in Europe for 8 years. I have almost 20 years of experience in Supply Chain, having started my career as executive on FMCG companies, designing and running processes and operations on a number of different functions, and, over the last 8 years I have been working as Supply Chain consultant.

 

Currently I am one of the founding partners of Spin Consulting (www.spinconsulting.net), a specialized SC boutique who differentiates by delivering   fast, tangible and sustainable results to our clients.

 

Thanks for having me here.

 

 

1) Would you provide us a historical perspective of Supply Chain Management evolution over the last years?

 

 

Sure. If we think as Supply Chain Management as the management of the flow of products, information and money between entities (businesses most of the time), we can say that we have been managing Supply Chains for a long time, even before that terminology was used.

 

Formal knowledge and organizations started to get a shape during the 60´s mainly on warehousing and transportation focused on improving operational efficiency. After that, during the 70´s and beginning of the 80´s the focus was on connecting the operational functions and manage the total cost, still mainly focused on logistics. It was during the 80´s that the terminology Supply Chain Management started been used in the literature and being practiced (worth mentioning the P&G and Wal-Mart collaborative program by late 80´s).

 

Since then, SCM practices have been quickly evolving, addressing internal coordination (source, plan, make and deliver processes) and external integration with the ultimate objective of delivering superior service to consumers at competitive costs.

 

 

2) What role do you think SCM plays on the business nowadays and how do you see it evolving? 

 

The world is getting more and more complex each day and that trend will only speed up. The markets and customers will differ on their requirements and expectations implying that operations will have to be segmented in order to be powerful and relevant. Also, the integration with business partners (both customers and suppliers) are key drivers of that evolution. On that context, Supply Chain is a key enabler and source of competitive advantage.

 

We can already clearly notice that companies with robust Supply Chain structures and with Supply Chain strategy connected to the business strategy are the companies delivering superior Customer Service Performance and financial results. P&G, Apple, Unilever, Inditex and Wal-Mart are some examples on a global scale.

 

 

3) So, is SCM an old discipline? 

 

 

As I mentioned, Supply Chain thinking has started a long time ago, even before the terminology was used.

 

It has been quickly evolving, transforming itself and the businesses and playing an ever-increasing role on the businesses performance.

 

Some sectors tend to move on the leading edge of SCM development, such as the auto industry and FMCG. They set the path for other industries that tend to follow their good practices.

More and more, companies have been investing relevant time and money in order to develop strong and robust SC departments to address a scenario of decreasing margins and growth rates, pressure from more demanding costumers and markets and consumers more complex and segmented.

 

The future of SC is to keep evolving and driving businesses transformations, creating competitive advantage and allowing step changes on efficiency, customer service and internal and external integration.

 

 

4) And, what would you point out as key success factors for SCM to develop its full potential and support business transformations?

 

The relevance of SCM, now and in the future, is related to its transformational potential of organizations and the value it creates for customers and consumers.

 

But that is far from an easy and quick task. A McKinsey survey says that 70% of transformational programs fail to deliver its promised results, and that is driven by non-desired behaviour, specially resistance to change and lack of leadership support.

 

Apart from that, having a robust Supply Chain Strategy, Processes and proper Technology support are non-negotiable elements to move organizations in the direction of more integrated and collaborative ways of working.

 

 

About Carlos Nascimento

 

 

 

 

 

Carlos Nascimento

 

Partner

 

Spin Consulting

I interviewed Jay Daniel who discussed Innovation in Supply Chain Trends for Driving Business Improvement.

 

 

 

 

 

 

Can you first provide a brief background of yourself?

 

Yeah. Hi, Dustin. Thanks for the interview. Actually, my name is Jay Daniel, assistant professor in the University of Technology, Sydney. I'm responsible for teaching and researching for post-graduate students here and for [inaudible 0:00:30] engineering, supply chain and operations engineering. And actually, the thing is, I've got more than 15 years’ experience in supply chain and logistics, quality and productivity improvement, and business analytics, decision making. I was working before as a logistics and supply chain solution analyst and project management for DB Schenker in Sydney and also different consulting firms. I'm very passionate in supply chain. My passion is supply chain and business analytics, actually.

 

Can you talk about what's involved with supply chain innovation for driving business improvement?

 

Yeah. Actually, as you know, innovation in supply chain trends for driving business improvement, there are different elements for innovation trends in supply chain like Internet of Things. For example, Internet of Things, lots of smart phones and different objects connected to each other at the moment and sensors or smart objects. For example, in Australia, a new device [inaudible 0:01:58] to text message their farmers when they are sick or pregnant. Those are very interesting things.

 

And other things about big data, it's about volume, velocity, and variability, and there's lots of data we need to manage in supply chain with different collaborators and different businesses in the supply chain and logistics networks -- like structured data, unstructured data, I mean, social media, different channels, customer service, sensor that data like RFIDs, GPS and different data, and new type of data like mapping and GPS, [inaudible 0:02:39] voice and digital mergers. We need to manage all big data in the supply chain to drive the innovation in the supply chain.

 

Another thing about automation and robotics, as you know, automation and robotics is very important. It's also [inaudible 0:02:58]. It's more powerful and [inaudible 0:03:03] forklifts, as you know.

 

Another thing is driverless trucks. As you know, driverless trucks, it's like Volvo's truck, driverless [inaudible 0:03:19] Europe. We need to think about in Australia, in Sydney, how we can have the driverless truck [inaudible 0:03:28].

 

Another thing about drones... As you know, drones, for example, at the moment, Amazon, they are doing trial about drones delivering parcel in 20 minutes from D.C. to the customer's door. There's the DHL delivery drones as well. They are making trial and doing research about this.

 

Another thing is blockchain and other trends, innovation trends. It's permanent, decentralized, global online leger of transaction using blockchain parts that can compare transactions without the need for central [inaudible 0:04:21] final authorities has made the link block that holds batches of valid transaction data. It started for bitcoins and bank and finance industries, but we can use it in supply chain and logistics to make more efficient and actually increase the communication between the collaborators in the supply chain and increase the efficiencies.

 

That's how technology is driving the innovations in supply chain.

 

Can you talk about the top five trends that you should know when competing with Amazon supply chain?

 

As you know, Amazon is coming to Australia. There are some trends that we need to know, competitors of Amazon in supply chain in Australia.And some of the companies, they need to worry a little bit about Amazon's coming to Australia. It's like electronics and [inaudible 0:05:29] and different retailers. They need to prepare themselves for Amazon. They need to know how to use robotics to grow more versatile supply chain, like Amazon, using [inaudible 0:05:42] robots.

 

And also, another thing about S&OP and forecasting,technology, as we discussed, [inaudible 0:05:51] and practices as well. And that's the procurement practices in important. The [inaudible 0:05:57], actually, the trend is more business will create with ecommerce platform, as I said, like blockchain, like different commerce channels. Here in Australia, we need to prepare for that.

 

Another thing is a user preference will enhance mobile management system, how we can do the mobile management system.

 

And the last thing is contingency planning will become standard practice, like risk management, disaster management, and this sort of stuff. You need to be resilient in the supply chain. We need to have a resilient supply chain. That's the top five trends to know to compete with Amazon in supply chain.

 

Do you have any final recommendations?

 

There is a supply chain manager. A good recommendation for supply chain managers of the future, actually, they need to know how to manage their supply chain — more responsive, agile, and resilient, and efficient as well. They need to know it's the business transformation changing from supply-centric to customer-centric. And they need to understand market understanding, customer [inaudible 0:07:20] with big data and those innovation technology, innovation trends.

 

They need to know from push to pull and management of the complexity and change. And also, from inventory to information system, information technology expertise. They need to have the sort of skills to compete with other competitors from transaction to relationship. They need to build the relationship with the collaborators, with businesses in supply chain, from trucks and ships to [inaudible 0:07:59] management. They need to understand supply chain management, understanding cost to serve, and time-based performance indicators, and other things about function to process. They need to have a process in the supply chain, not just the function, silos in the supply chain, all the links and blocks and step that are connected in the supply chain.

 

Another thing from standalone competition to network competition.And they need to know how to have a win-win orientation, hiring consultants for them to be successful in the marketplace, the competitive marketplace. That's my [inaudible 0:08:45] for the supply chain manager of the future — to drive the innovation and drive the responsive and efficient supply chain.

 

Well thanks for sharing today, Jay.

 

Thank you. Thanks for your time. Thanks for interviewing me. Thanks for having me.

 

Thank you. 

 

 

 

About Jay Daniel, PhD

 

 

 

 

 

Jay Daniel, PhD

 

Business Analytics ★ Sustainable Supply Chain ★ Quality and Productivity Improvement Expert

 

LinkedIn Profile