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2017

Thanks to my client Dan Vest, I read a fascinating article about Sears and Amazon. Who knew Sears and Amazon had so much in common? Pretty startling! The Reader's Digest version is as follows: Sears was the former Amazon about 100 years ago, growing 50-fold within a decade with its world-famous catalog and then transforming from a mailing company to a brick-and-mortar giant. They were the everything store with an uncanny feel for consumer demand. Sound familiar? So what might we learn from history and paying attention to trends?

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

Perhaps Sears isn't something to be totally ignored… As transformative, customer-focused and growth-oriented as they were 100 years ago, they stopped looking for the next customer-focused innovation and have suffered mightily. Clearly, if you lose track of your customer, you are likely to lose track of your growth and profits. It is also easy to get lost as you get big – suddenly what used to be innovative is replaced with ridiculous rules and bureaucracy with no glance in the direction of the customer. Walmart came on the scene with amazing service and low costs. And now Amazon is the 80 pound gorilla.

There is another interesting development to note. Amazon tends to choose strange bedfellows and has partnered with the brick-and-mortar giant. Amazon will sell smart technology such as the Echo in Sears stores and the Sears flagship Kenmore brand product line will be sold online through Amazon. Unique collaborations seem to be driving success.  Just look at the partnership of innovative Amazon with "not-known-for-its-innovation" United States Postal Service (USPS), yet it works. Do you see postal trucks delivering on Sundays? I do.

In short, pay attention to history, trends and never stop thinking. Add collaboration into the mix and you might just hit a home run.

Last week, Kash Gokli (Professor of Manufacturing Practice and Director of the Engineering Clinic at Harvey Mudd) and I led our most recent Harvey Mudd Executive Roundtable on the topic of competition. We created these roundtables to bring Southern California executives together to network and discuss timely topics for organization success. We had a fascinating discussion about two general themes: How to develop a strategy to make you stand out from the crowd so you have no competition AND how to collaborate with your competition for win-win success. In today's Amazon-impacted, competitive world, it is wise to be thinking about your closest business challengers unless you want to be left in the dust.

[caption id="attachment_5201" align="aligncenter" width="700"] Harvey Mudd Executive Roundtable Attendees[/caption]

 

One tip to implement this week:

Let's start by making sure you know your competition. Certainly, as an executive, you'll be aware of your competitors. The key question is most likely: Could your teams identify the key players? Which competitors are most prevalent in your industry? Now for the clincher – how well can you and your organization describe how you stack up vs. your competition? Start here and really drill down to the details.

Next, let's move on beyond understanding the competition. Do you understand your vision and whether you are fighting it out on a weekly basis? Or do you have a strategy for how to distinguish yourselves from other businesses such that for all intents and purposes, you have no competition? It’s easier said than done but definitely worth considering.

And let's not forget collaboration. Almost every attendee could come up with an example of how they were collaborating with a competitor for the "right" situation at the "right" time. Can you find ways to collaborate for win-win success? It might just pay to remember that your relationship network is one of your most valuable assets.

I sat on a panel of experts for Mobility 21's annual conference titled "Speed to Delivery: Good's Movement's High-Tech Future", addressing the future of transportation. It was a fascinating meeting and panel discussion due to the amazing amount of technology being discussed – and one of the panelists was the Senior Director of Sustainability for Walmart.

[caption id="attachment_5187" align="alignnone" width="250"] Walmart's focus on speed and the customer is paramount.[/caption]

Driving the Future of Transportation.

Walmart has come up in several circles lately. One of our clients supports Walmart's stores, and so we learned quite a lot about their fulfillment processes, demand planning practices and, of course, their new OTIF (on-time-in-full) metrics. We also discussed Walmart service with a 3PL partner, and how Walmart has been making headlines lately in the e-commerce race. It is worth paying attention. Here are a few of the highlights:

  1. The focus on the customer is paramount.
  2. The use of crowd sourcing is gaining steam with the use of Uber and Lyft to deliver from the store.
  3. Who knew but Walmart is testing deliveries with drones as well!
  4. Walmart associates are making deliveries on their way home which is possible with the software that can align deliveries with routes.
  5. They just announced a partnership with August Home Smart Lock to deliver when the customer isn't at home – and even put groceries in the refrigerator.

It is always a good idea to stay up-to-speed with what the leaders are doing in the industry. Their ideas are not always the ones to follow but they are ALWAYS ones to ponder for application, impact and down-the-line trends. Who do you follow?

 

Did you like this article? Continue reading on the topic:

Walmart Raising the Supply Chain Metrics Bar

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Are You Reshoring?

Posted by lisaanderson Nov 17, 2017

reshoring and manufacturing

Many U.S. companies active in China have moved some operations out of the country - 38% relocated to North America.[/caption]

My APICS Inland Empire Chapter hosted a program on "Changing Trade Policies and its Effect on Reshoring" with Michele Nash-Hoff, author of "Rebuild Manufacturing - the key to American Prosperity". And, interestingly, the Institute of Management Accountants (IMA) Orange County chose "Onshoring Profits: Manufacturing is Not Dead Yet" from a long list of topics and asked that I speak on its impact. Thus, it seems only appropriate to discuss a few common themes:

  1. U.S. firms are leaving China as conditions worsen. Actually, 25% of U.S. companies active in China have moved some operations out of the country.  38% relocated to North America.
  2. In 2014/2015, parity was reached between offshoring & returning jobs.
  3. 7 industries have reached the tipping point of returning to the U.S. and these sectors account for 70% of U.S. imports. For example, computer electronics, electrical equipment, and furniture make the list.
  4. Using purchase price or landed cost do NOT capture total cost of ownership and can lead to incorrect sourcing decisions from a financial viewpoint.
  5. 70% of executives are thinking about reshoring.

Where are you sourcing from currently? Don't just jump on the new bandwagon of reshoring – but you should give your total cost of ownership a second look as well as dig into your customers' expectations and sourcing impacts. You might just be surprised as to what this new view tells you!

 

Did you like this article? Continue reading: Reshoring Gains

Lately, we’ve been called in by several clients with ERP challenges that directly impact business growth and success. Do you desire profitable growth? If so, add ERP into your strategic discussions. Would you delegate a decision that could literally make or break your customer service, profit margins (or lack thereof) and ability to grow? I think not!

 

Incorporate ERP strategy discussions into executive meetings. It matters.

 

ERP Strategy Matters

There has been a widespread need to consider ERP as a strategic topic. For example, these scenarios have arisen in just the last month:

  1. In one manufacturing company, the ERP system was holding them back from growing. For a family-owned business, that is the equivalent of a noose around the neck.
  2. In another manufacturing and distribution business, they couldn’t figure out their costs – this issue certainly provides challenges for profitable growth.
  3. And in yet another situation, the ERP system wouldn’t support the business processes adequately and therefore would hold the owners back from getting away from the business (even for an extended vacation), let alone increasing the value of the business.
  4. A complex enterprise also struggled to further utilize their system for management decision-making due to data integrity obstacles and the lack of flexible reporting.

As I enjoy stating the obvious (one of my favorite clients used to say about me), none of these situations are desirable! Instead of ending up butting your head against the wall, start thinking about ERP as a strategic topic and include it in your executive meetings.

 

If you liked this article, check out:

Why ERP Success is a Strategic Topic