The following posting can also be viewed and commented upon on the Supply Chain Expert Community web site.

This posting continues highlights of the Kinexions 2011 conference being held this week in Scottsdale Arizona.  Readers can also reference our prior Dispatch One , Dispatch Two and Dispatch Three commentaries.

One of the new twists to this year’s Kinexions conference was an invitation for a broader group of industry analysts / partners / bloggers to not only partake of the conference but also attend a separate afternoon briefing session hosted by Kinaxis senior management and select customers. Seldom have I found software vendors willing to allow this grouping open access, and we complement Kinaxis for this effort.  As COO John Sicard explained to me, the company has reached a point where it requires broader market awareness of its capabilities.

The influencer briefing kicked-off with CEO Doug Colbeth and COO John Sicard jointly providing a history of the company both in its fabric and its technology development. Emphasis was placed on the current demonstrated scalability of RapidResponse and an acknowledgement that the application works best when in coexistence of existing ERP or legacy systems among its customers. Nearly 60 percent of Kinaxis existing customer base operate with an SAP ERP backbone system.  Also explained was that when users interact with RapidResponse they declare their work area responsibility, which the application then utilizes to tailor respective planning views. The application not only manages and processes large amounts of data, but also the business rules that exist regarding that data.  In our view, that characterizes RapidResponse as akin to a business process management (BPM) type of application, which the application accomplishes in its S&OP functionality. We were also briefed on why the new announced re-naming to Kinaxis RapidResponse Supply Chain Control Tower was a natural extension of the company’s current growth plans.  Although there was a on-stage demo, not a lot of information was shared in this session regarding the detailed functionality that is being planned for this extension of RapidResponse capabilities.

The remainder of the influencer briefing session focused on interaction and presentations from invited customers. Elisabeth Kaszas, Director of Supply Chain for Amgen, provided an update on that company’s multi-year transformational efforts towards more responsive supply chain business processes. A benefit mentioned, that was rather difficult to do in the existing ERP backbone system,was the need to provide various product costing structures beyond just standard cost data.

Chalam Kalahasti, Director of Global Planning and Fulfillment for Cisco Systems, described the unique challenges for planning a highly outsourced, globally extended supply chain.  Cisco has a very active S&OP process tied to RapidResponse, and a plan-of-record is created weekly. What is also noteworthy is that Cisco’s direction in more response-oriented planning has been motivated by previous incidents of supply chain disruption, such as earthquakes in Taiwan and China and the tsunami in northern Japan.  Cisco’s supply chain planning process is predicated on the ability to assess a definitive impact from an unplanned event and to provide different options and scenarios for responding to the exception.

Paul Lindblom, a member of the senior IT staff at Qualcomm QCT, provided a detailed perspective of how RapidResponse integrates with various other Qualcomm systems, along with the unique needs for planning in a combination push-pull, semiconductor supply chain.  Semiconductor wafers are long lead-time items subject to fab capacity considerations, and in the case of Qualcomm, multiple fabs are utilized to supply product.  Conversely, wafer packaging and testing are driven by customer buying and lead-time requirement cycles. Semiconductor planning needs which requires the unique ability to be supported for by-product and co-product production are supported in RapidResponse.

Due to time constraints, our final session featured Kerry Zuber of Kinaxis who provided an overview of the latest 10.0 release of RapidResponse, which includes a significant investment in demand management and product forecasting functionality.

Our briefing turned out to be a jam-packed session with a literal fire-hose of information.  Luckily, the customer appreciation event held on a reservation in the hills outside of Phoenix allowed ample opportunity to unwind and have great conversations with fellow attendees.

In a final posting, Supply Chain Matters will provide some final summary comments and observations regarding the Kinexions 2011 conference.

Bob Ferrari

Added Note: Kinaxis is one of other named sponsors of the Supply Chain Matters blog and the author provides services to this vendor.

The following posting can also be viewed and commented on the Supply Chain Expert Community web site.

This posting continues highlights of the Kinexions 2011 conference being held this week in Scottsdale Arizona.  Readers can also reference our prior Dispatch One and Dispatch Two commentaries  which highlight day one activities.

Day two of Kinexions kicked off with an uncensored presentation from former Gartner Vice President and supply chain sage Kevin O’Marah, who now characterizes himself as an independent thinker.  Kevin reflected on the history of business automation and innovation, the important trends that productivity and talent have brought to businesses large and small and his belief that large ERP vendors are not delivering the innovation required to enable the next era of business and supply chain process capabilities. Kevin referenced multiple survey data that reinforces that demand volatility is driving executives and supply chains literally crazy, and that the community needs to get ahead of these new realities of business. Kevin described the new wave as being led by human intelligence but with technology leverage.  Kevin was also kind enough to acknowledge our working relationship in the earlier days of AMR Research and I sincerely thank Kevin for the mention.

Day two customer presentations featured Lalit Pandit, the CIO of D&M Holdings, and Joe McBeth, Vice President of Global Supply Chain at Jabil, and Erwin Hermans, Vice President of Supply Chain Solutions, Celestica.  One of the extraordinary aspects of attending a Kinexions conference is that the audience can get perspectives from the key players located throughout many tiers of today’s global supply chain. The D&M Holdings story is one of a mid-market company that needed to transform its supply chain utilizing a planning and response management application that users could quickly adopt and leverage.  It is also an example of how a cloud offering is an important option for mid-market companies.

While there were many nuggets of information shared by all of today’s presenters, my personal favorite was Jim McBeth, who vividly expressed what supply chain response management really means for companies, and especially contract manufacturers. Jim reflected on the recent March earthquake involving northern Japan, and more recently, the devastating floods impacting Thailand.  Each had supply chain disruption implications, and as Jim best described it, “the guy who was the best information, wins”. In 48 hours, Jabil was able to provide risk assessments and impact analysis for its OEM customers and key suppliers. Jim noted that most organizations, consultants and pundits speak to constantly keeping inventory down, when the reality may be keeping partners in balance and inventory right-sized to buffer identified areas of component risk. Jim also spoke to the reality of planning at the EMS level, the mid-tier of high tech value chains when the bigger fish OEM’s will get the prime priority for available inventory and capacity. The reality turns out to be the ability to plan with predictive data, to proactively collaborate with OEM’s along with the ability to predict what requirements will be before the bigger players do the same.

This afternoon’s closing event was an interactive influencer’s panel discussion moderated by Trevor Miles of Kinaxis, which I was honored to be invited to participate.  Fellow panelists were Andy Coldrick, one of the original thought leaders in S&OP, Russell Goodman, editor-in-chief, SupplyChainBrain, and Predrang (PJ) Jakovljevic of Technology Evaluation Center.  Our goal was to wrap-up the conference by summarizing what we heard from customers and influencers, how we viewed the current state of  supply chain business process and technology innovation, and the notion of what is the state of collaboration in supply chains. A eureka moment came from an interchange of what comes next for S&OP?  Andy provided the perspective that as the originators of S&OP discussed what would be the next iterations, they also could not agree to terminology.  Andy’s charge to the audience, it doesn’t matter how you term the next iteration, what matters more is the objective your organization is seeking. Wise words from an original thought leader.

Supply Chain Matters will feature two additional Kinexions commentaries, one reflecting on this year’s briefing of key market influencers, and our conference summary impressions.

Bob Ferrari

Added Note: Kinaxis is one of other named sponsors of the Supply Chain Matters blog and the author provides services to this vendor.

The following posting can also be viewed and commented on the Supply Chain Expert Community web site.

This posting continues highlights of the Kinexions 2011 conference being held this week in Scottsdale Arizona.  Readers can also reference our prior Day One dispatch which highlighted remarks from Kinaxis President/CEO Doug Colbeth.

Day one featured a full agenda of customer and partner presentations along with the first ever briefing session for industry analysts, partners and key market influencers.  Customer presentations included Barnes and Noble, specifically the Nook Division, who’s implementation pioneers a an entirely new area of support for Kinaxis RapidResponse, namely the incorporation of actual point-of-sales demand data into overall supply chain planning and visibility.  When implemented, this effort has the potential to be the largest deployment in terms of scope and user count of RapidResponse to date.  Matthew Red, Vice President, Supply and Demand Planning, took leave of the upcoming planned go-live to share his organization’s goal to have product demand visibility among 13,000 point-of-sales outlets implemented to support the upcoming 2011 holiday buying season. The clear focus for B&N is to focus on “sell-through”, namely where customers are buying and how the supply chain should best respond to outlet level demand.  Even though the go-live will occur in the coming weeks, Matthew was able to share lessons learned, which identified access to data as the biggest challenge along with the need to scale-back on original project scope because of implementation timing needs.

Another customer presentation included one by Lockheed Martin on managing its supply chain performance-based logistics need by utilization of RapidResponse.  The morning concluded with a presentation and demonstration of the new RapidResponse Control Tower from Kinaxis’s new vice-president of marketing, Kirk Munroe.  One of the highlights of this presentation was the articulation of the three design pillars for control tower functionality:

• Supply and demand balancing to responsive and predictable customer fulfillment.
• Planning, monitoring and responding only works if they are performed from one platform.
• Business problems are complex, but IT systems need not be as complex.

The pillars are simply stated but the meanings are all important.  We would hasten to add that business rule context is another very important consideration for any decision platform.

For Supply Chain Matters, and for others, one of the most talked about presentations during day one was delivered by McKinsey partner Paul Carbonneau. Readers should note that McKinsey’s reputation lies in consulting on C-level corporate strategy, direction and problem-solving, and to have a McKinsey partner talk to the importance of supply chain capabilities is a significant affirmation of how important global supply chain capabilities have become in C-level perspectives and concerns.  In that light, Paul communicated that the most expensive problems for McKinsey clients often are reflected in supply chain capabilities. Another significant reinforcement came from Paul’s comments relative to the March earthquake that occurred in Japan and the high-level awareness of the impacts of supply chain disruption and risk that has occurred across the C-suite right now.  My hallway conversations reinforced the fact that many manufacturers are re-visiting or initiating supply chain risk identification and mitigation.  An added takeaway shared by Paul was that McKinsey is advising clients to re-visit previous thinking and specifically three myths surrounding business process and technology implementation efforts. These include:

• Rather than linear rollouts of functional initiatives, pilot initiatives with the required cross-functional behaviors needed to sustain the new process.
• Rather than people first, process next, and technology last, with the implication of multi-year technology implementation calendars, frame the initiative with a defined narrower scope but with all three components required in the new or changed business process.
• Rather than getting the CEO on-board first, and risking a perceived colossal waste of time by that executive, bring C-level sponsorship on-board when definite pilot steps indicate meaningful benefits.

McKinsey further advocates starting with small ecosystem initiatives that include all required capabilities. Rather than spending enormous amounts of time getting organizational-wide consensus on a theoretical future end-state, launch “live-fire” exercises and iterative pilots that emulate what end-state could be. Accept the notion and provide support mechanisms that anticipate frequent failures, with constant learning and forward movement.  Finally, once pilots have provided valid benefits, scale quickly with serious investments in talent, disciplines, and required tools.

A final message reflected on future supply chain challenges that lie ahead and the need for, what Paul described as,  ‘maestros’ of supply chain planning and decision-making.  These are people who can think cross-functionally and cross-organizationalyl, who know where the right information resides, and how to leverage that information into various predictive options and scenarios to which  that the supply chain needs to respond.

It was a rather thought-provoking presentation and well slotted to kickoff a supply chain response management oriented conference. Supply Chain Matters will provide additional context and commentary in our summary impressions of this year’s Kinexions.

In our subsequent dispatches, we will provide highlights of day two of Kinexions 2011, along with summary impressions, so stay tuned.

Bob Ferrari

Added Note: Kinaxis is one of other named sponsors of the the Supply Chain Matters blog and the author provides services to this vendor.

The following posting can also be viewed and commented on the Supply Chain Expert Community web site.

Day one of the Kinexions 2011 began with a full agenda of customer and partner presentations along with a significant announcement regarding the renaming and product direction for the Kinaxis software suite.  The conference kicked off with a rousing rock music video featuring many of the employees of Kinaxis welcoming this year’s attendees to the conference.  This author has attended many, many software conferences and this is the first time we have witnessed an opening video that actually features the people behind the scenes and thanks customers for their business.  It was great.

Doug Colbeth, Kinaxis President and CEO opened the conference by summarizing three themes that he has consistently heard from his many conversations with C-level executives. The first was represented by a person jumping out of a building, namely that in today’s volatile business environment, executives often have the feeling that they have jumped into a free-fall zone, waiting for the bungee cord will stop the free fall. That bungee cord is often the supply chain responding to a significant event. The second major theme was the funnel cloud of demand volatility, with the implication that the need to effectively respond to constant market demand change is ever more important.  The third theme was visualized as a junkyard, representing a reflection of the current frustration among C-level executives of the lack of flexibility and business responsiveness to the current climate of business among the current IT applications landscape that populates many large firms today. That frustration is often reflected toward corporate ERP and legacy systems that were designed with far different assumptions related to the speed of business change, and the realities of highly outsourced and complex global supply chains.

Colbeth noted that these recent conversations have reflected the need by customers to have a unified information portal of the entire supply chain that could serve as a control point for more predictive decisions and actions. In many industry settings, the umbrella of supply chain business processes and related decision-making have broadened to include new product introduction, supplier management, risk management, sales, operations and financial planning as well as customer services management. The analogy of need is often drawn to having a control tower of the supply chain, a single point of command and control. Colbeth noted that rather than providing multiple applications and platforms, Kinaxis will continue to focus on a single platform that supports multiple supply chain related decision-support needs. He reaffirmed that Kinaxis will always have a built-in bias that the supply chain is the company’s center of the universe.  With that came the announcement that the company is renaming its product to Kinaxis RapidResponse Control Tower, which will continue to support broader supply chain business process decision-making needs. Kinaxis has four customers that are deploying various aspects of supply chain control and over the course of the conference, customers, prospects and market influencers will be provided additional perspectives as to planned functionality.

Needless to state, this is a rather bold and dramatic direction for Kinaxis, one that promises to provide added dynamics to the supply chain technology provider landscape.

In our subsequent dispatches, we will provide some additional highlights of day one of Kinexions 2011, so stay tuned.

Bob Ferrari

Added Note: Kinaxis is one of other named sponsors of the the Supply Chain Matters blog and the author provides services to this vendor.

It is a Monday morning and I’m facing a six hour plane ride enroute to the Kinaxis Kinexions conference.  Noting that my carrier is Southwest Airlines, I was compelled to not only bring my own food and snacks but to bring lots of reading material to compensate for zero entertainment and creature comfort amenities. One of the best companions, I have found for a long plane ride are unread copies of Economist magazine where there is ample time to read from cover-to-cover. The October 8 issue provided an insightful but stark commentary on the business implications of current economic events occurring across Europe which I suspect will have many potential implications for global supply chain strategy and preparedness.

The article is titled: Under the volcano- how companies are preparing for various scenarios, (paid subscription or metered view requirement) and it provided some stark reminders that European businesses remain highly concerned about current events surrounding Europe’s ongoing sovereign debt crisis and how these events will unfold in financial and economic terms.  Some business forecasters believe that the Eurozone could fracture or possibly break apart completely.  That would imply implications for credit, inflation, currency and cross-border trade. Reading of the various scenarios and contingencies that some European manufacturers are undertaking should cause supply chain executives to also reflect on contingency planning.

Supply Chain Matters believes that senior supply chain executives, if they have not done so thus far, should be initiating and contemplating scenario plans and contingencies in three potential areas of supply chain impact. These three areas are to buffer overall business impacts, but in the perspective of crisis bringing opportunity, there may be some opportunistic considerations to consider as well.

The three contingency areas should include:

• An impact to B2B, P2P and E-Commerce fulfillment strategies involving suppliers and customers located within Eurozone countries.  These processes are currently predicated on a single Euro-based currency. If the Eurozone were to split into two-zones, strong and weak, or to split altogether, the implications for systems supporting B2B commerce would be rather fluid, and potentially complex.  There would be implications in supplier contracts in adjusting or re-negotiating financial exposures, invoicing and currency collection. While contracts may have contingencies already identified, it would be wise to begin a contingency focused analysis of areas of potential impact or exposure.  Similarly, IT support teams should be thinking about potential systems impacts and response strategies.

• Another area could be supply chain shocks in logistics/transportation and customs requirements.  Today, Europe and global-based manufacturers can assume a seamless physical flow of component and finished goods across Eurozone countries.  Hopefully that will continue, but then again, sudden shocks could occur if certain countries are jettisoned out from the Eurozone or forced to fall back on independent customs and transport regulations. Severe financial crisis could bring motivation t0 add more import tariff revenues to depleted treasuries or weakened economies.

• The third contingency area would be financing of inventory and working capital.  Similar to what immediately occurred during the 2008-2009 financial meltdown, some European manufacturers, especially those residing in financially weakened banking sectors such as Greece, Ireland, Italy, Portugal or Spain are already experiencing difficulty in acquiring affordable access to credit and loans.  A worsening of bank fragility or more outright bank failures would cause an additional credit crisis for these companies, and this would impact supply chain working capital, production and inventory deployment strategies.  Mid-market firms are especially vulnerable. Financial supply chain, suppler health checks, inventory and tooling investment implications should be considered.

The Economist article additionally notes that many European firms are now accelerating efforts to buffer exposure to a potential Europe financial crisis, and are thus are aggressively accelerating plans to market and sell their products within the emerging market economies of China, India and Latin America.  That makes lots of sense.  But at the same time, non-European companies may be afforded added opportunities to compete for additional business in these emerging markets by virtue of the existence of a more stable currency, banking or financial system that provides affordable access to financing product innovation, services or added inventory pipeline.

The intent of our commentary is not to raise immediate alarms but to begin prudent planning for possible supply chain disruption scenarios.  Just like last year’s volcanic ash incident that shutdown Europe’s air traffic, high uncertainty should motivate active contingency planning.

Readers and supply chain focused consultants are welcomed to share their perspectives for contingency plan considerations.

Bob Ferrari