CSCMP stresses importance of supply chain professionals
Supply chain professionals will be indispensable during future economic volatility and uncertainty, according to experts at CSCMP.
By Tom Andel, Editor-in-Chief -- Modern Materials Handling, 11/1/2008
You have never been more important to your company, more than 3,000 supply chain management professionals were told at the Council of Supply Chain Management Professionals (CSCMP) annual conference last month in Denver.
Whether those attendees were responsible for the flow of goods within their four walls or between a chain of materials handling enterprises stretched around the globe, the geopolitical forces making the nightly news are demanding strategic thinking.
Richard Jackson, executive vice president of Limited Logistics Services, stressed the strategic importance of supply chain professionals knowing more about their business.
“A supply chain professional has a unique view, different from that of the CFO and CEO,” he said. The more you know about how business works, the more your input will shape the discussion that helps formulate decisions.
Many companies base inventory strategies on what's selling best. But Robert Martichenko, president of LeanCor, said a better strategy is to identify what's stable, looking for what's predictable rather than relying on averages.
He used the old A-B-C slotting strategy as an example, where the more popular A items get slotted closer to materials handlers and B and C items are further away.
For example, in the case of Carl Zeiss Vision, only 12% of orders had just A items in them. Thirty percent had a mix of A, B and C. He advised correlating C items to A items in a slotting strategy. This kind of thinking helped Carl Zeiss develop a new warehouse layout, resulting in more transactions processed per hour, reduced labor and total expenses.
While supply chain professionals from the 20th century are used to uncertainty, the 21st century is ushering in a new era of volatility, said Mahender Singh, head of the Supply Chain 2020 research project at the MIT Center for Transportation and Logistics. Capitalizing on that future uncertainty and disruption depends on going further than just tweaking operations.
“The C-suite still thinks of us as product movers,” he said. “We need to think of business performance, not just supply chain. Weave yourself into the fabric of your company. Make yourself indispensable.”
Bob Parker of Manufacturing Insights noted during his session that service is becoming more important than products, especially commodity products. One chlorine supplier had an idea to install sensors in customers' pools to measure pH levels and then release the right amount of chlorine to treat the situation. The same strategic use of technology applies in the plant or distribution center.
Parker said the use of RFID, sensors, GPS and wireless is making reliable information available at the shelf level, feeding better information to upper level information systems where strategies are formulated. Professionals should own that input and be recognized for it. The analysis can help a company stay away from stale assumptions about inventory.
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