Tom Andel

Partnership: keep the warm; discard the fuzzy.

Partnership isn’t always all it’s cracked-up to be. In fact cracked-up is an appropriate term for many famous partnerships in history: Henry VIII & Ann Boleyn; Dr. Jekyll & Mr. Hyde; Dean Martin & Jerry Lewis; Elizabeth Taylor & husbands 1 through 8; The Beatles; I could go on, but you’d stop reading—and I don’t want us to break up like that. I’ll make my point.

Partnership in a supply chain is no warmer or fuzzier than any of those. But in today’s economy, there’s an extra incentive to make it work. While researching an article on materials handling best practices in the retail sector for Modern’s May issue, it was apparent that many companies—retailers, suppliers, and third party logistics providers—are great role models for 21st century partnerships. Technology is helping them solidify their relationships. As a result, the warmth of human interaction is preserved while the fuzziness of buzzwords is eliminated.

For example, Germany’s largest retailer, The METRO Group, is installing RFID portals in 200 of its “Real hypermarkets“ this year. Dr. Gerd Wolfram, managing director of MGI METRO Group Information Technology, told me The METRO Group is banking on RFID to optimize its business processes, lower its process costs, and “offer considerable advantages to all partners along its supply chain.“

“METRO Group supports all of its partners through an exchange of information and a team of experts that is specially prepared for the field of RFID,“ he said.

It’s doing this by helping newcomers to this technology take their first steps in deploying it. METRO Group and its IT partners are supporting manufacturers who intend to introduce the RFID technology. Customized “Starter Kits” are helping. METRO is encouraging suppliers to tag all pallets sent to it with UHF RFID tags. It’s even taking its own first steps into item-level tagging at its Galeria Kaufhof department store in Essen. In the men´s fashion department more than 30,000 products have been fitted with RFID labels. The pilot will be evaluated and the results will be published later this year.

METRO is already convinced of RFID’s wider ranging supply chain benefits. In fact these benefits extend beyond its supply chain to the surrounding environment. Wolfram says this technology enables his company to improve logistical efficiency, therefore minimizing idle times for delivery trucks. It also increases the accuracy of deliveries, which ensures that additional truck trips can be significantly reduced.

Is all of this talk about the wonders of partnership, RFID and environmental sustainability, just fuzzy talk from your supply chain perspective or are you in fact linking up solidly with companies upstream and downstream?

Posted by Tom Andel on April 2, 2008 | Comments (0)