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Top Ten Most Read 2015 Supply Chain Matters Content

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This Editor had the opportunity to view our Supply Chain Matters readership analytics (thanks to Google Analytics) for all of 2015 and can now share our ten most popular 2015 commentaries during the year.  Supply Chain Matters Blog

In reverse order:

Number 10

Highlights of the APICS Annual 2015 Conference held in Las Vegas in October, and specifically ex-GE CEO Jack Welch’s keynote interview. Welch expressed a number of insights on the topic of leadership, and more specifically, supply chain management, and the professionals who manage today’s supply chains. We are very pleased that this commentary made our top ten.

Number Nine

Our September commentary related to Tesla Motors contracting of strategic supply of lithium for its new gigafactory. Our commentary addressed the  broader strategy unfolding, one that extends beyond automotive supply chain needs, including the power storage needs of homes and businesses. The site was chosen because of its close proximity to supplies of the all-important raw material of lithium as well as to the Tesla factory in California.

It seems that our readers were quite interested in all news related to Tesla  since the auto manufacturer appears twice in our Top Ten.

Number Eight

Our July commentary addressing the needs of supply chain business intelligence for SAP environments, specifically that as supply chain business processes become ever more complex, teams try to fill the gaps with downloads of static reports and ancillary spreadsheets to provide more meaningful operational analysis. We felt and sense that this is indeed representative of the broader SAP community, and brought awareness to other options. Our commentary brought wider attention to Supply Chain Matters Named sponsor Every Angle Software who’s self-service operationally focused business intelligence tool includes an extensive list of European installed base customers with SAP backbones.

Number Seven

Our January commentary, “Extended supply chain” is the new supply chain, a guest contribution by Prashant Mendki, Director Alliances and Business Development for supply chain systems integrator Bristlecone. The commentary called for a holistic “integrated extended supply chain” rather than independent business processes where the entire ecosystem would be treated as part of the supply chain, and where suppliers would have complete visibility into key customer demand and have their response plan ready.

Number Six

Our September market education commentary bringing visibility to Xerox’s new more cost affordable smart labeling technology and the availability of two printed electronic labels that can collect and store information about either the authenticity or condition of products flowing across the supply chain. From our lens, the availability of such advanced labeling technology will foster new, more affordable dimensions of item level tracking, security and authenticity specifically related to products. This author characterized the development as the dawning of item-level tracking technology that industry supply chain teams have versioned for quite some time.

Number Five

The highlights of our Supply Chain Matters interview with Irfan Khan, CEO of Bristlecone while attending the Gartner Supply Chain Executive conference. Our interview touched upon a number of areas including predictive analytics applied to supply chain decision-making needs. Irfan opined that mainstream acceptance of the full spectrum of smarter analytics (Descriptive, Prescriptive and Cognitive) applied to supply chain and manufacturing capabilities will take additional time for most organizations to be fully prepared to leverage. He confirmed organizational change management readiness and client skill impacts that take time to work through

Number Four

Oracle’s July announcement of expansion of public cloud capabilities applied to order fulfillment, specifically Oracle Order Management Cloud and Oracle Global Order Promising Cloud. Out takeaway for readers was that Oracle remained committed toward a broader development and release plan surrounding SCM applications in the public cloud platform than perhaps other competitors such as SAP.

Later in 2015, in conjunction with Oracle Open World, the full Oracle SCM Cloud suite was announced by Larry Ellison in his opening keynote. From our lens, Oracle had developed one of the broadest cross-functional supply chain management, public cloud based applications currently available in the marketplace. That stated, there are qualifiers in that this public cloud suite provides standard functionality as opposed to the ability to support customized customer business needs. Its strength resides in faster time-to-value and potentially lower IT infrastructure deployment costs.

Number Three

Our highlights and impressions regarding the FedEx acquisition of both Genco and Bongo International. Genco was one of the largest 3PL’s in North America and Bongo International provides an e-commerce platform that facilitates international customers purchasing items from domestic websites.  We were intrigued by the low price paid for Genco which as less than current earnings.

Number Two

Our February commentary reflecting on Tesla’s operating results reflecting some supply chain strainsOur observation was that while showing some supply chain strains at the end of 2014, even more challenges remained for Tesla’s supply chain in 2015. Tesla has often demonstrated the effective use of advanced technology applied to manufacturing and supply chain business processes, and that 2015 will be no exception to that trend.

We just published a follow-on commentary reflecting on Tesla’s 2015 delivery performance leaving some Model X customers rather frustrated.

 

Finally, our Number One most read 2015 content was:

Our unveiling of the full listing of 2016 Predictions for Industry and Global Supply Chains published on December 15th.  We interpret that to mean that our readers are keenly focused on what lies ahead in the New Year, and that’s OK with us.

 

We trust that all of our line-of-business, IT and cross-functional supply chain readers have gained value and insight from our independent lens on supply chain focused business developments, business process and technology challenges among various industry and global perspectives. We believe we have accumulated a truly in-depth library of industry-specific and functional content.

Once again, as we enter our ninth year and remaining as a top ten or top twenty-five presence among supply chain blogs, we again thank our loyal global based readers and our sponsors for their continuing support.

Bob Ferrari, Founder and Executive Editor

© 2016 The Ferrari Consulting and Research Group and the Supply Chain Matters® blog.

Content appearing on Supply Chain Matters® may not be used by any third party without written permission of the author and/or our parent, The Ferrari Consulting and Research Group LLC.


Apple Promotes Supply Chain Executive to COO Role

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In these end-of-year Supply Chain Matters commentaries, we wanted to update our readers on certain news and developments that occurred just prior to the Christmas holiday.

On December 17th, Apple realigned its senior executive ranks for the coming year and promoted its existing worldwide operations and supply chain executive to chief operating officer. Senior vise-president Jeff Williams, a longtime trusted lieutenant to CEO, Tim Cook was promoted to the COO position, once occupied by Cook when Steve Jobs was CEO. With this appointment, Williams becomes fourth C-level executive at Apple which includes chief financial officer Luca Maestri, chief design officer Jony Ive and of-course, Cook.

Williams joined Apple in 1998 as head of procurement and has steadily increased leadership responsibilities among Apple’s various supply chain operations, administration and global initiatives, including efforts to improve global supply chain transparency and social responsibility. In 2013 he was designated to oversee the development and ongoing product management efforts of the Apple Watch. Williams came to Apple after procurement and operational leadership roles at IBM.

This announcement came amid other new executive assignments that included Phil Schiller, senior vice president of worldwide marketing, expanding his role to include leadership of the App Store® across all Apple platforms and Johny Sroujii who led semiconductor engineering being appointed senior vice-president for hardware technologies. Tor Myhren, who will be  joining Apple in the first calendar quarter of 2016 was appointed vice president of marketing communications, reporting to CEO Cook.

In its press release announcing the COO role CEO Cook cited Williams as being “..hands-down the best operations executive I’ve ever worked with

Supply Chain Matters extends congratulations to Mr. Williams on his new leadership role.

It is yet another example of how supply chain leadership experience is a doorway to broader C-level roles.

 


Key Themes from Kinexions 2015 and How They Relate in 2016

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This author has penned another in my series of guest postings on the 21st Century Supply Chain blog, hosted by supply chain planning and response management technology provider Kinaxis.

Kinexions 2015, the annual Kinaxis training and user conference, featured some fascinating speakers that delivered timely messages and themes for the supply chain management community regarding important competencies. As we enter 2016, such messages will take on a special meaning, and in this guest contribution, I touched upon some of the key takeaways that stood out for this author and how they relate to our 2016 Predictions for Industry and Global Supply Chains.

To view this commentary, click on:  Kinexions 2015 Key Themes and How They Relate to the Coming Year.  The themes on innovation, supply chain change, skills development and integrated business planning will indeed manifest themselves in the coming year.

Bob Ferrari

Disclosure: Kinaxis is one of other sponsors of the Supply Chain Matters blog.


Supply Chain Matters 2016 Predictions for Industry and Global Supply Chains in Detail-Part Two

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We continue with our Supply Chain Matters series outlining in more detail, 2016 Predictions for Industry and Global Supply Chains. These predictions are provided in the spirit of assisting industry supply chain teams in setting management objectives for the year ahead as well as helping our readers and clients to prepare supply chain Supply Chain Matters Blogmanagement and line-of-business teams in establishing meaningful programs, initiatives and educational agendas.

The context for these predictions includes a broad cross-functional umbrella of supply chain strategy, planning, execution, product lifecycle management, procurement, manufacturing, transportation, logistics and service management.

Our predictions series includes a re-look at all that occurred in the current year, a reflection of future implications, and soliciting input from clients and other supply chain and blogosphere observers. Unlike others, we incorporate a lot of thought and perspective into our annual predictions and take the time to actually scorecard our annual predictions at the end of the year.

Readers are welcomed to review our complete listing of all ten 2016 predictions for industry and global supply chains.

In our Part One posting, we dived into Prediction One that addressed what industry supply chains should anticipate in global chain activity and Prediction Two, what to expect for inbound commodity and component costs as well as unique challenges for sourcing and procurement teams in the coming year.

In this posting, we explore our next two predictions.

 

2016 Prediction Three:  Turbulence and Continued Change Surrounds Global Transportation and Logistics

Both in 2014 and 2015, we predicted industry turbulence among global and certain domestic transportation networks.  Our predictions turned out to be fairly accurate but then again, the signs were obvious. As industry supply chains enter 2016, we are again compelled to predict another year of turbulence and change and perhaps a few surprises.

The added dimension will be the third-party or fourth-party logistics (3PL/4PL) sector. In 2015, an outbreak of merger and acquisition events involving both small and large industry players will have even further implications in 2016 as industry players are compelled to consolidate in order to insure faster growth, additional industry expertise, more global scale and deeper technology capabilities. We concur with other industry watchers that M&A will become a new norm in logistics during 2016. We further anticipate that dominate online retailers, either Alibaba or Amazon will playout industry disruptor roles, either in expanding their own parcel logistics fulfillment and delivery capabilities, or participating in some forms of acquisitions themselves.

As observed in 2015, parcel logistics and transportation services providers FedEx and UPS may have pushed too far with their added rate hikes and surcharges both in 2015 and for 2016. We predict that larger shippers, especially those anchored in online B2C/B2B commerce will be pushing back at contract renewal time. When the dust settles after the 2015 holiday fulfillment surge, parcel services providers and online retailers will be pointing fingers at one another as to which party impacted business results. More accurate forecasting and misalignment of retailer and parcel carrier networks will be further discussion points.

In the global ocean container transportation sector, it became even more obvious by late 2015 that the industry’s overcapacity situation coupled with declining global demand would have meaningful impacts to carrier P&L’s. Some industry watchers peg current industry overcapacity levels at near 30 percent, others more than that. Additional, new and larger capacity vessels will again enter the global fleet in 2016, precipitating difficult decisions relative to more idling or scrapping of older vessels. Just as we pen these predictions in mid-December of 2015, second-ranked CMA CGM announced its intention to acquire Neptune Orient Lines and noted as the biggest event in shipping consolidation since 2005. China’s two state-owned shipping lines, Costco and China Shipping, have been granted merger approval but their shares were battered by Asian investors. We believe that further consolidation among lower-tiered players is a moderate possibility in the coming year as is the idling of more vessels.

The expanded Panama Canal is planned to open in April of 2016, but we predict that date will slip because of meaningful construction and repair delays. Many major ports on the eastern side of the canal continue to make significant investments in upgraded infrastructure and deeper shipping channels to prepare for direct Asia to North American and South American east coast ports.  Thus a delay to the expanded canal may be favorable for Americas east coast ports.

In July of 2016, a new regulation is scheduled to go into effect among 171 countries requiring ocean containers shippers to certify the weight of a container before they are loaded onto ships.  This regulation was adopted to insure more safety of vessels and to avoid container overloading abuse leading to accidents at sea or in ports.  We predict that this new weight certification regulation will add significantly to port congestion in 2016, especially among ports ill prepared to deal with controlling and auditing enforcement.

For global air freight, the International Air Transport Association (IATA) predicted in early December that 2015 overall anemic demand for air cargo services is expected to continue into 2016.  Average airfreight load factor is at six-year lows and are described by an IATA economist  as presenting a “dismal picture” for this segment. Here again, an industry capacity glut continues to manifest itself principally because of the introduction of more passenger planes which are serving as air cargo transport

In the North American railroad sector, U.S. and Canadian based railroads remain negatively impacted on the demand side by significant cutbacks in North America crude oil transport needs, as a result of the current historic low costs of fuel and glut of global inventory. Railroads that experienced a boom period in crude transport were suddenly forced to shed headcount and idle tank car inventory as a consequence. A new development that will potentially occur in 2016 is the additional linking of continental rail networks. In late November, Canadian Pacific Rail (CP Rail) made public overtures to merge with Norfolk Southern, which was rebuffed on at least two occasions by Norfolk management. The move can be considered strategic in that it opens a rail transit network from U.S. east coast ports into Canada. By mid-December, industry leading BNSF Railway indicated that it would be open for a competing bid for Norfolk Southern, no doubt to offset any inter-modal volume that shifts to the east. Considering these ongoing developments, we would not be surprised the at least one significant North America based railroad network merger is consummated.

 

2016 Prediction Four: Widening of Supply Chain Talent and Skill Gaps Require Organizations to be More Innovative and Purposeful in Recruitment, Training and Career Planning

We predict that the existing widening skill gaps will compel industry supply chains to be more creative and purposeful in recruitment and training. That includes facing the realities of competitive compensation and purposeful career planning for individuals. We expect organizations and recruiters to more broadly define and recruit employees from skill based dimensions and in expected performance parameters for both current and future organizational needs. Individuals who possess required cross-functional hard and soft skills, including in-depth technology prowess will continue to experience a seller’s advantage.

We expect manufacturers, retailers and supply chain services firms to encourage broader training, benchmarking, multi-business and multi-geography opportunities.  We trust that supply chain leaders will confront or at least influence the other elephant in the room, namely that of compensation plans related to required supply chain management skills and roles. Now is the time for more creative compensation planning, tied to performance, teamwork and skill achievement objectives. We are hopeful that there will be more of such innovative compensation programs unveiled in the coming year.

We anticipate that in the coming year, more and more individuals will take on their own personal responsibility to self-train in the various skills desired by the most attractive employers, which will place more demands on universities, supply chain professionals and community colleges for up-to-date and timely adult training geared to industry skill needs. The Internet will continue to play an important role as the preferred delivery platform for updated supply chain skills training for individuals and we anticipate that supply chain professional organizations will continue to leverage this medium . We like the approach that APICS has taken in offering corporations a bundling of programs for formal certification in supply chain management, as well as and supply chain organizational process discipline related to the Supply Chain Operations Framework Model. (SCOR) Similarly programs that nationally recognize top up and coming stars in supply chain management such as the 30 Under 30 Rising Supply Chain Stars jointly sponsored by ThomasNet and ISM are noteworthy for generating added interest for millennials planning a career in supply chain management.

Supply chain technology and services providers can make a continued contribution to the skills challenge by increasing efforts to provide more user-friendly interfaces and tutorials for advanced technology and by partnering with industry supply chain teams to consistently define skill characteristics and needs.

Throughout 2016, to foster broader industry education, Supply Chain Matters will feature and amplify laudable training and skill development efforts in addressing supply chain talent and skill development needs. We encourage leading organizations to let us know about your successes as well as organizational learnings in this area.

 

Keep your browser pointed to Supply Chain Matters as we continue dive into each of the above 2016 predictions in more detail. In our Part Two posting we will explore Prediction Three- continued turbulence in global transportation and logistics, and Prediction Four- the widening of supply chain talent and skills gaps.

In the meantime, share your own predictions over and above those that we have outlined. Utilize the Comments section associated with this posting or email us directly with your predictions at: feedback <at> supply-chain-matters <dot> com.  We will share all contributed predictions in a final predictions of this 2016 series.

Bob Ferrari, Founder and Executive Editor

©2015 The Ferrari Consulting and Research Group and the Supply Chain Matters® blog.

Content appearing on Supply Chain Matters® may not be used by any third party without written permission of the author and our parent, The Ferrari Consulting and Research Group.

 


Supply Chain Matters 2016 Predictions for Industry and Global Supply Chains

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Once a year, just before the start of the New Year, our parent, the Ferrari Consulting and Research Group along with Supply Chain Matters provide a series of predictions for the coming year. These predictions are provided in the spirit of assisting industry supply chain teams in setting management objectives for the year ahead as well as Supply Chain Matters Bloghelping our readers and clients to prepare supply chain management and line-of-business teams in establishing meaningful programs, initiatives and educational agendas.

The context for these predictions includes a broad cross-functional umbrella of supply chain strategy, planning, execution, product lifecycle management, procurement, manufacturing, transportation, logistics and service management.

Our process includes a re-look at all that occurred in the current year, a reflection of future implications, and soliciting input from clients and other supply chain and blogosphere observers. Unlike others, we incorporate a lot of thought and perspective into our annual predictions and take the time to actually scorecard our annual predictions at the end of the year. Readers are welcomed to review our scorecard series of our 2015 predictions that occurred in late November.

In this initial posting, we will unveil our complete listing of our ten predictions for the coming year with summary descriptors. In subsequent postings spanning the remaining weeks of December we will dive further into each of our predictions. In early January, we will publish the complete Ferrari Consulting and Research Group research report, 2016 Predictions for Industry and Global Supply Chains that will incorporate all of our predictions along with even more details and supporting data related to each prediction. This report will be made available to all of our consulting clients and will further be made available for no-cost complimentary downloading in the Research Center of Supply Chain Matters.  Anticipate general availability in mid-January with an announcement on this blog.

Let’s therefore begin the process with the unveiling our ten 2016 predictions.

 

2016 Prediction One: A Year of Uncertainty and Continuous Challenges Related to Global Supply Chain Activity

Our first prediction related to global activity is that industry and global supply chains should anticipate another year of uncertainty in planning product demand and supply needs on an individual geographic region or country basis.  From our lens, there will be a need for lots of contingency and various scenario planning options, and sales and operations planning will be very engaged and challenged throughout the year to meet expected business outcomes.  Even more production overcapacity across China’s industry sectors will add to downward global pricing pressures affecting specific industry supply chains.

 

2016 Prediction Two: Favorable Outlook for Inbound Component and Commodity Costs but Procurement Teams Need to Step-up Supplier Management

Global commodity prices, the raw-material of industry supply chains, declined sharply during 2015.  The World Bank’s Commodity Markets Outlook published in October 2015 generally called for slightly higher non-energy commodity prices in 2016 including categories of Agriculture, Raw Materials, Fertilizers Metals and Minerals. We believe that may be too optimistic and that continued overcapacity will drive inbound prices generally lower. The most significant commodity price trend remains that of oil, as the price of crude oil has reached seven year lows amidst of global glut of supply and little demand growth.

Due to the uncertainty and the heightened supply risks expected in 2016, procurement teams will need to re-double their efforts focused on supplier assessment and monitoring.

 

2016 Prediction Three:  Turbulence and Continued Change Surrounds Global Transportation and Logistics

As we enter 2016 we are once again compelled to predict another year of turbulence and continued change surrounding global transportation and logistics with particular emphasis in the third-party/fourth-party logistics, global ocean container and air freight segments. We are predicting more consolidation and mergers to occur among ocean container shipping lines and one North America based rail merger to occur in 2016.

 

2016 Prediction Four: Widening of Supply Chain Talent and Skill Gaps Will Require Organizations to be More Innovative and Purposeful in Recruitment, Career Planning and Training Efforts

We predict that the existing widening skill gaps will compel industry supply chain executives to be more creative and purposeful in recruitment and training. That includes facing the realities of competitive compensation and purposeful career planning for individuals. We expect organizations and recruiters to more broadly define supply chain related jobs in skill dimensions and in expected performance parameters for both current and future organizational needs. Individuals who possess required cross-functional hard and soft skills, including in-depth technology prowess will continue to experience a seller’s advantage.

 

2016 Prediction Five: Noted Supply Chain Industry-Specific Challenges

In 2016, challenges will remain in B2C Online Retail, Commercial Aerospace, Consumer Product Goods (CPG) and Automotive industry sectors.  We have added a further 2016 industry challenge, that being current efforts to deploy more sustainable and health conscious agriculture and food based supply chains.

 

2016 Prediction Six: Certain Industry S&OP Processes Will Morph to Broader Forms of Integrated Business Planning and Product Management.

The term integrated business planning is often depicted as a specific technology vendor term but in reality, it is a desire that all functions of a firm are aligned at a single set of financial, business, supply chain and operational outcomes.  As multi-industry business challenges continue in speed and complexity, S&OP processes will need to foster more agility to effectively deal with change. In 2016 we anticipate that certain S&OP teams, those experiencing high levels of value-chain complexity and business change, will begin to morph S&OP process and decision-making with broader information and contextual decision-making components and begin to identify and address obstacles for incorporating key information integration from product management and financial systems.

 

2016 Prediction Seven: Internet of Things (IoT) Initiatives Continue to Dive into Realities of Line of Business Strategy and Deployment

In 2016, we anticipate that B2B focused manufacturers and services providers will broaden their perspectives on connected devices and services, especially in the notions of the realities for being a software-driven vs. a hardware-driven enterprise. That includes leveraging intellectual property and software knowledge into more innovative products and services that result in new revenue streams. Thus, the value of products will increasingly be defined by the embedded sensors, software and consequent added services that products provide for customers.

 

2016 Prediction Eight: Geopolitical Developments Centered on Global Trade Agreements Will Present New Concerns and Challenges for Specific Industry Supply Chains.

Details of the recently adopted Trans-Pacific Partnership will continue to unfold in 2016 while individual sponsoring countries undertake the process of ratification. As TPP details emerge, industry supply chains will begin to uncover certain strategic and tactical impacts related to current global sourcing strategies. China will continue to drive and influence its One Belt, One Road (OBOR) initiative placing additional political and specific industry pressures on certain TPP participants. Industry supply chain teams will thus be caught in the middle of geopolitical pressures and forces in relation to pending strategic sourcing or value-chain design strategies.

 

2016 Prediction Nine: Alibaba and Amazon Will Expand Their Presence in Customer Logistics Fulfillment.

There are stronger indications that online giants Alibaba and Amazon will expand their presence in last-mile customer fulfillment. Increasing transportation rates and surcharges from both FedEx and UPS in 2015, and in the coming year, make this prediction more viable for the most influential online retailers as well as more evidence pointing to such capabilities.

 

2016 Prediction Ten: A High Visibility Supply Chain Snafu or Event with Business Implications

This is a prediction that we are obviously reluctant to publish for readers and clients. However, our observation of industry supply chains being whiplashed with unprecedented business change and growing global chain risks leads us to this prediction.

 

Keep your browser pointed to Supply Chain Matters as we dive into each of the above 2016 predictions in more detail. In the meantime, share your own predictions over and above those that we have outlined. Utilize the Comments section associated with this posting or email us directly with your predictions at: feedback <at> supply-chain-matters <dot> com.  We will share all contributed predictions in a final predictions of this 2016 series.

Bob Ferrari, Founder and Executive Editor

©2015 The Ferrari Consulting and Research Group and the Supply Chain Matters® blog.

Content appearing on Supply Chain Matters® may not be used by any third party without written permission of the author and our parent, The Ferrari Consulting and Research Group.


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