Skip navigation
2017

 

Last weekend, I attended the wedding of a client colleague and friend, and luckily I stayed just long enough to see the Chinelo dancers. I had no idea what a Chinelo dancer was prior to this wedding; however, they were a big hit!

 

family traditions

Chinelos is a traditional carnival dance in the Mexican state of Morelos. The Chinelo dancers dance to a brass band — in essence it is a colorful hip hop focused on the family. It is hard not to be cheerful with the family traditions, colorful costumes, big hats and powerful music of this dance. I understand they play at festivals, weddings, funerals and rodeos. Now that reminds me of the New Orleans funeral — quite the festivity! Have you thought about the importance of family traditions and being colorful?

 

One tip to implement this week:

 

I work with many family-owned businesses — and businesses that could learn something by creating family-type traditions, even if private equity backed or a department or facility of a multi-billion-dollar enterprise. What brings your teams together? Similar to this Chinelo dance that brings grandparents with grandchildren and many more together and passes through the generations, what sort of legacy could your team create where your team members would desire to pass it to the next generation, mentee or peer?

 

Why not think of something fun? Enjoying your day certainly can go a long way to creating a happy environment with happy and productive employees. How about colorful? Why not ignite the creativity within your team? Creativity and innovation can create dramatic results but they cannot be dictated. Your people must feel safe in being colorful, making mistakes and learning from them. Do they? Take a small step and find a way to add a bit of color to your day.

 

 

Looking for more ideas to keep your supply chain connected? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”

new bookLisa Anderson MBA, CSCP, CLTD, known as the Manufacturing Business Transformer(SM) and president of LMA Consulting Group, released her book, I've Been Thinking...Turning Everyday Interactions into Profitable Opportunities, as a roadmap for businesses, manufacturers and distributors to infuse innovation into their daily work practices. The book is packed with over 100 of Anderson's insights and strategies on how to create bold customer promises and profits by transforming business performance while keeping an eye on the global perspective and seeing what others cannot in order to create dramatic customer experiences and profitable opportunities. Anderson relies on her global consulting practice where she draws on her experience and observations to share with readers practical and action-inducing ideas to help businesses make the leap ahead of their competition.

 

"Lisa Anderson not only engages us, she enables us to engage others. She's given herself the ultimate gift: the time to think unmolested and undisturbed, emptying her mind of the daily grind and allowing herself to travel outside of the box, to destinations of creativity, insight, and perspective. To stand on great walls," states Alan Weiss, Ph.D. is the author of Million Dollar Consulting.

 

Anderson has been publishing a weekly newsletter by the same name, I've Been Thinking, since 2014, which her clients find to be an invaluable resource. Wallace P. Brithinee, Ph.D. and President of Brithinee Electric, states "I like Lisa's column, 'I've Been Thinking', because it delivers the right mix of suggestions, prodding, and human interest that I find useful."

 

The author says that writing her newsletter has expanded her thinking dramatically, "Now, there are a seemingly endless supply of everyday interactions that can be turned into profitable opportunities." Anderson further states that she now sees everyday occurrences in an entirely new light — there is always some sort of idea or lesson to glean from the most mundane of topics.

 

"As president of LMA Consulting Group, as well as her leadership positions in APICS and other organizations, Lisa gets to meet a lot of people and gets to visit a lot of companies," says Professor Kash Gokli of Harvey Mudd College. "That is where she gets her inspiration for 'I've Been Thinking.' Her writing on a diverse compilation of best practices is both informative and insightful."

 

I've Been Thinking is available as a paperback on Amazon and as an eBook on Kindle. To subscribe to Lisa Anderson's newsletter, click here or copy and paste this link into your browser https://www.lma-consultinggroup.com/ibt-index/

 

 

VMI software

Vendor Managed Inventory (VMI) - do you need software? Of course, the answer is "It depends."

 

A few items to think about to determine if you need software to support a VMI initiative:

 

  1. Are you interested in doing VMI with your suppliers, customers or both? For suppliers, the focus is on the transfer of data. For customers, you'll need to create orders and transfer data at a minimum.
  2. How many suppliers and/or customers and customer locations do you plan to pursue with VMI? If there are few, manual will work just fine. We have achieved vast success with aerospace clients using portal data and manually creating orders.
  3. How integrated do you need VMI to be with your ERP system? For example, when I was VP of Operations at PaperPak, we implemented VMI with our #1 customer, Baxter Healthcare/Shield Healthcare and so we figured out what to send to their locations throughout the U.S. We provided such excellent service that we won supplier of the year two years in a row! However, even better, we were able to gain huge benefits on our side with inventory turns, logistics efficiencies, gains in business etc. In our case, VMI was separate; however, the orders had to be visible in both systems, and the forecast had to go to ERP as well. However, we didn't have to physically scan items at our customers' locations which might require a direct connection depending on your setup.
  4. Are your suppliers/customers EDI capable? Do they use portals? If they use portals, does your ERP system have portal capability? Or do they send spreadsheets? Or emails? Technical capabilities will play an important role.

 

 

Did you like this article? Continue reading on how to become a Systems Pragmatist:

 

Leveraging Your ERP System

4 Critical Success Factors Key to ERP Success

On the 10 year anniversary of my business, I recognized 10 people for 10 years as LMA Advocates - people who have gone over and beyond, resulting in LMA Consulting's growth and success. I truly appreciate their support, expertise, ideas and feedback. I would not be here today without them - and certainly not leading a growing and leading edge consulting practice that partners with manufacturers and supply chain organizations to create BOLD customer promises and profits. Who doesn't want to find the win-win-win of customer growth/loyalty, profits and accelerated cash flow?!

 

Ever since my 10-year bash, I've recognized one person each year on the anniversary of LMA Consulting. Thus, on my 12-year anniversary, I'm thrilled to announce Parizad Sethna, VP of Member Services for APICS-IE and Supply Chain Manager at Nestle.

 

Parizad and I collaborate on the APICS-IE Board of Directors, and she has been instrumental in our communications, executive panel and networking symposiums and raising the bar in terms of the value we provide members. She also stands out from the crowd with her creativity, innovation and determination in taking on new areas of responsibility that might be considered outside of her core area of expertise, which I have found particularly valuable with both APICS and LMA Consulting. 

 

One tip to implement this week:

There isn't a bad time to take stock of whether you are recognizing people enough! Start with those that report to you. Who stands out from the crowd? Make sure your feedback and recognition is specific. Although I went big with a nice award, a simple thank you can go a long way. Of course, you can do both. Don't recognize too many people as it might deter from the significance. However, you could add another category. For example, I am thinking about adding a category for a high performance manufacturer or distributor. You'll likely see this coming soon....

 

Don't stop with your direct reports! I think an often overlooked opportunity is to recognize your peers and managers. There are many ways to recognize them by putting in a good word, by sending an email, writing them a recommendation on LinkedIn, taking them to lunch etc. Start your juices thinking about recognition.

There is no doubt logistics is relevant in the U.S. and the Inland Empire. During a presentation by the visionary behind the World Logistics Center in the Inland Empire, I heard several amazing statistics. One that stands out in my mind is the fact that the GDP of the 11 Western States would be the 3rd largest economy in the world behind the U.S. and China, largely due to the impact of international trade.

 

Going hand-in-hand with the sheer relevance of logistics is the fact that we'd be hard pressed to find any product solely made in any specific country. For example, Apple has 776 global suppliers. In partnering with several Southern California manufacturers and distributors, the picture below is not uncommon in terms of sourcing requirements to produce a product. The bottom line is that logistics can have a powerful impact on the world economy and on your customer experience and profitability.

 

World Logistics Center

What Should We Consider and/or What Impacts Could Arise?

Certainly, a good place to start is to not ignore logistics. It might seem like goods movement wouldn't be that important yet it can have a profound impact, starting with the customer. Regardless of your supply chain network (whether you are a single manufacturing facility with local suppliers and local customers, a pure global network or anywhere in-between), you must think about your customers (both current and prospective). What type of service and experiences do you need to provide in order to gain customer loyalty? Once you know this answer, you can think further about your network and logistics implications.


Once you are evaluating logistics options, you'll see the vast array of options and trade-offs. We are collaborating with a client currently to evaluate their supply chain network, and there are far more considerations than you'd think. Before jumping to a decision that you'll be stuck with for the long-term, take stock of your current situation. Evaluate your forecast and future business. Consider innovative customer collaboration programs. There is a heightened interest in these lately! Understand your customer requirements, and align your supply chain network to these while optimizing sales growth/customer service, cash flow, and profitability.

 

 

 

VMI - Supply Chain Collaboration

Supply chain collaboration is in vogue. Customers have figured out that if suppliers have access to more information on what they need and what is important to them that they'll typically do a better job of meeting those needs. Suppliers have figured out that the more they understand customers, the more likely they'll be able to delight them while minimizing spending. And this type of thinking carries over to your suppliers' suppliers and customers' customers and all supply chain parties in-between such as transportation and logistics partners, trusted advisers and more.

 

So, what are some of the ways supply chain partners collaborate?

 

1. Sharing of customer preferences - the more your supply chain understands about the end customer (whether a consumer, patient, manufacturer etc.), the better served the customer will be.
2. Sharing of forecasts - the better your supply chain understands your likely production schedule/usage or sales forecast, the better your supply chain can ensure you have what you need when you need it at the lowest cost.
3. Sharing of inventory - key to VMI is the sharing of inventory information. The best way to maximize performance of the supply chain is to provide access to inventory information in combination with trust. For example, if your supplier can save $1000 by temporarily reducing your inventory slightly until an already-scheduled truck is available to deliver the next day and you will not run out for 5 days, why not save $1000?
4. Sharing of resources - vendor managed inventory experts can help set up these types of programs with minimal disruption and maximum results. Not every supply chain partner will have the same type of resources. Why not share to better the entire supply chain? For example, one of our clients had a technical guru, another had a spreadsheet guru and another had a VMI guru. If they had access to all three for the implementation of VMI, it would be a win-win-win.

 

Did you like this article? Continue reading on how to be the Strongest Link in your organization:

 

Vendor Managed Inventory Is Making a Comeback

 

Supply Chain Collaboration

My ProVisors group had two competing teams working to get out of an escape room (my team is pictured below). Thanks to James Valmonte for such a great idea and coordination! It was an exciting experience to work through the clues and figure our way out of the room. Although I was a Nancy Drew fan when young (and even wrote a Nancy Drew-like novel with my childhood friend Vonda Zwick that won an award), I wouldn't say this was an easy process in the slightest. It took the full team to have any hope of figuring it out. It certainly brought quite a few skills to the forefront that are valuable in all aspects of life.

One tip to implement this week:

Getting out of an escape room requires many skills needed to succeed in business. There is little to no hope of getting out while working in isolation; a team with varying skills is needed. Working in collaboration is essential. Thus, even though it might seem easier to do a task yourself, think first. Take a step back and consider your end objective. What do you want to achieve? Then, think about the skills and/or resources that would be helpful to best achieve that objective. Gather your team and tackle the issue.

 

You might not want to collaborate with people you think will disagree with your approach or aspects of your project; however, think twice before dismissing that thought. Instead, think about how to pull different opinions and perspectives into the mix to gain a better solution.

 

 

Looking for more ideas to keep your supply chain connected? Access more tips and resources on my blog. And keep connected by subscribing to my newsletter and email feed of “I’ve Been Thinking…”

 

According to Industry Week and Moody's Investor Service, there could be a significant upside to robots with the near-term demographic time bomb in Japan and Germany. Certainly, work will need to continue to get done; however, as more and more workers retire, that could become a challenge. Thus, robots might have another advantage in addition to automation - as the percentage of workers over 65 is expected to soar in both Japan and Germany, robots might substitute for labor. Also, both countries are early robot adopters. Time is ripe for robots.

 

What Should We Consider and/or What Impacts Could Arise?

The key question is whether you are pursuing automation, robots and other strategies to meet your objectives - whether it is to increase efficiency, replace labor (as it becomes harder to find) or to increase accuracy. If you don't start thinking about how to incorporate this type of strategic thinking into your plans now, the opportunity is likely to pass you by.

 

Technology changes daily. For example, there is never the "right" time to purchase a computer. By the time you purchase the computer, technology has changed. However, if you wait for that 'perfect' time, it could be similar to hanging onto a Blackberry waiting for the perfect upgrade. Instead, think about which technology and automation is important in supporting your business objectives. Don't just pursue technology for technology's sake but correlate the appropriate technology with your business objectives to achieve success. Do a bit of research, ask experts, put together plans and ACT while the technology is still ripe. 

VMIVendor managed inventory can have many benefits - both from a strategic perspective and a tactical one. We are seeing that it is gaining in popularity as manufacturers and distributors and retail locations see the value of collaborating with supply chain partners to drive dramatic benefit across the supply chain. 

 

Several of the top benefits include the following: 

 

  1. Increased revenue - By partnering with customers on VMI and customer collaboration programs, you become a trusted and value-added partner. As new business opportunities arise, we've found that those who offer VMI typically have an advantage. First, the customer knows they will have what they need, where they need it and when they need it to satisfy demand. Next, the customer knows it is easy to work with a VMI partner and so will prefer to expand capabilities with them. And, lastly, the customer is likely to recognize these preferred suppliers.
  2. Responsiveness & agility - By collaborating up and down your supply chain, you build a greater agility and responsiveness into your supply chain. With a greater access to information and a quicker view of market changes, responsiveness will increase throughout.
  3. Improved customer service & reduced lead times - Often, this is the most critical benefit across the board. With VMI, there is better collaboration, information-sharing and visibility. In every client project, we dramatically improved service levels and reduced lead times.
  4. Accelerated cash flow - As inventory is managed across the supply chain, inventory levels can be reduced while service is maintained or improved. We have frequently reduced inventory levels to the customers' target level while reducing supplier inventory by 20-60%. 
  5. Improved margins - As the supplier is able to plan across the supply chain, he/she is able to optimize transportation, warehousing and production efficiencies internally while meeting service and inventory targets for the customer. We have seen rather significant improvements (around 20%) by pursuing this opportunity.

 

Did you like this article? Continue reading on how to strengthen your Eagle Eye:

 

4 Keys to VMI

 

Cross-Supply Chain Opportunities

 

According to the Journal of Commerce, the top importers were impacted by e-commerce and that trend is expected to continue. Imports grew by 8% last year (2.2 million TEU) whereas exports grew by 3% (just under a million TEU). The rankings are showing signs of a shakeup with the surge in e-commerce and Amazon. In 2016, Walmart rated #1, Target #2 and then Home Depot and Lowe's as #3 and 4.

 

e-commerce

For example, the retail industry woes are highlighted by Sears and Walmart. Sears sales slid by almost 10% whereas Macy's slid almost 4% and Payless filed for Chapter 11 protection (all top 100 importers) while Amazon increased 27%. Last year, e-commerce accounted for 8.1% of retail sales and it's expected to increase by 10% by 2022. Walmart fared a bit better but spent several billions to purchase JET.com. And, Target is also testing next day deliveries. Small orders delivered rapidly is the future!

 

Not to leave exporters out of the mix, as a matter of interest, the top exported product is wastepaper with beef products also high on the list. 5 of the top 6 relate to paper and packaging such as Koch Industries with the holdout being an animal feed/grain exporter.

 

What Should We Consider and/or What Impacts Could Arise?

 

Clearly, we must pay attention to what our customers are communicating — they want small orders more frequently — with rapid deliveries. How will we accomplish this goal? We can certainly outsource the capability or, if we see it as a strategic aspect of the business going forward, perhaps we should think about how to incorporate into our strategic capabilities.

 

From a sales and customer perspective, start looking at e-commerce capabilities. 24/7 access is a must with the ease of doing business built into the process. You'll need to integrate into your ERP system or find a way to work collaboratively from a process and systems perspective one way or another to maintain high service levels at reasonable efficiency levels.

 

From a warehousing perspective, handling e-commerce is quite opposite of handling pallets and bulk shipments. Think about them as two separate warehousing functions. There is quite a bit of automated equipment and technology that can help you automate and increase efficiency. But don't just jump in and sink. Start researching, ask experts and build a plan. There is no time to waste!

 

In our experience working with manufacturers and distributors from small, family-owned businesses to medium-sized, private equity backed companies to global large, complex organizations, projects account for 80% of the improvement. There are projects to improve efficiencies, reduce inventory, grow sales, expand into new regions, consolidate operations and the list goes on. Thus, if we must rely on projects for business growth and profitability, should we think about our project managers as million-dollar project managers?

Most likely the answer is yes. However, in our experience, project managers are not often treated with much respect. Oftentimes, they are seen as lower level resources responsible for executing initiatives, coordinating resources and reporting progress up the chain. But, is this how we should treat our resources who can have such a far-reaching impact?

Let’s think about the reach of project managers’ impact. There are several key points to consider:

1. Impact on resources: Undoubtedly, the number one concern from all levels of leadership relates back to resources. There are “too many,” “not enough,” “not the right skills,” “not allocated properly” and so on. Thus, anyone who has a significant impact on resources should be considered valuable.

2. Daily decisions on which tasks gain priority: Similar to the impact on resources, determining the priority of tasks is crucial. As a project manager, there is a constant need to prioritize among tasks, collaborate with departments, etc.

3. Ingrained in the business: Project managers are in the “thick of things” on a daily basis. In order to complete tasks and achieve results, project managers are involved in a wide array of activities. They are familiar with what is working and what isn’t working in each department as it relates to project tasks. There are very few projects which are confined to a singular department.

4. Communicate across the organization: In order to complete their tasks, the project manager must communicate and collaborate across departments and layers of the organization. Since high-quality resources are hard to come by, it is vital to keep communications in a positive light.

5. Impact on profit: Certainly, almost every project relates back to profitability in some respect. Whether we are growing the business, increasing margins, automating key processes or improving efficiencies, there is a direct impact on profit.

So, since it is clear that project managers have a substantial impact on business success, it is wise to think about how to maximize their performance. As a metaphor, the million-dollar project manager is appealing since there is often million-dollar impacts. Thus, what should we do to ensure project managers are treated more like million-dollar project managers?

1. Provide clarity of the big picture: Project managers will be more invested in their projects if they understand the impact on the organization. Make sure to provide clarity of the big picture and how they fit in.

2. Give them discretion: There have been countless studies as to what is most successful in keeping valuable employees (like your million-dollar project managers), and the net conclusion is that employees want some ability to affect the outcome of their work. We must give them some level of discretion to make decisions and guide their projects within reasonable parameters.

3. Recognize small wins: Managing projects can be a slog into details with little to show for it. Find small wins to celebrate. Make a big deal of the importance and tie it back to the project manager and their team.

4. Support their decisions: There is nothing more important than supporting your project managers. Of course, providing constructive feedback is essential; however, when in the heat of the battle, it is vital to support your project manager’s decisions. Without this support at critical junctures, the project will suffer, and the project manager will become dismayed.

5. Promote the project: Promoting the project throughout the organization can do quite a lot for its chances of success. How do you get resources to want to join your project team? Start by being attractive. This oftentimes goes back to how compelling the project seems. Make it so! Do you think the best leaders’ projects for improving margins happen to be more enticing than the average leaders’ projects of the same type? No; perception becomes a reality.

Since projects will have a substantial effect on your customer loyalty and bottom line – the two most critical aspects of any business – it is worthwhile taking a few steps back to think about the project managers driving these results. If you think about their impact, a million dollars might not be sufficient. Therefore, start thinking about your project managers as though they have a million-dollar impact and results will follow.

 

Did you like this article? Continue reading on how to strengthen your Eagle Eye:

The Project Managers Skill Gap

Why Does Employee Engagement Matter?