Top Ideas for Generating Value in the Supply Chain

July 21, 2009

In a recent issue of Supply Chain Management Review, Sumantra Sengupta, vice president at Hitachi Consulting offered “The Top Ten Ideas for Generating Value” in supply chain innovation.

“It is rare to find an organization thinking about—let alone investing in – supply chain innovation. However they will readily spend hundreds of millions of dollars on product and service innovation,” writes Sengupta.

The following are the Top Five ideas on Sengupta’s list, which, he says if “applied aggressively during turbulent economic times like these, can yield powerful results that will position companies well for the upturn we hope and expect to come.”

  1. Shift the focus from order-to-delivery to design-to-support. This shift enables companies to fully explore their inherent strengths in product design and innovation while continuing to drive down supply chain costs.
  2. Look for hidden values in reverse logistics. Returns represent a prime source for discovering significant value that can immediately drop to the bottom line.
  3. Globalize the functional processes and adopt a “follow the sun” model for skill deployment. Just as they have outsourced their IT departments, companies globalize their supply chain functional processes using talent pools that are available across the world.
  4. Manage the supply chain using the concept of floor-and-surge to deliver with increased agility and less waste. The floor-and-surge approach allows the corporation to benefit from the longer production run economics as well as the labor arbitrage that many seek.
  5. Focus on real-time updates and adjustments to increase agility and shape responsiveness. Planning and forecasting is still necessary, yet it now needs to be conducted in near- real-time.



Global CFO survey highlights increased risk of missing links between finance and procurement

July 9, 2009

A recent survey of 550 chief financial officers from organizations around the world has found that today’s businesses are defined by their supply chains and that CFO’s are not making the most of what their procurement teams bring to the table.
The Cost of Control, commissioned by Basware and produced in cooperation with Indiana University’s Kelley School of Business and the University of Navarra’s IESE Business School reports that:

Just 28% of CFOs say procurement has a significant impact on financial risk exposure.
Less than half see any level of integration between procurement and finance processes.
Almost 60% of indirect spending goes untracked by global organizations.
64% of respondents rate cost cutting as the top priority, whereas just 39% cite reducing  risk as a priority
In spite of the high-risk economic environment created by the global economic downturn, CFOs are shunning risk management in favor of cost cutting. And they are failing to treat supply chain dangers seriously enough, according to the report. Sixty-four percent of the CFOs said that bringing costs down was the top item on their agenda.

At the same time, strategic goals are taking a backseat for many, with only 39 percent citing risk analysis as a major concern and a comparable 39 percent believing that maintaining or improving margins is key. In contrast, and unexpectedly given the strategic emphasis in recent years on green sourcing and paperless offices by many companies in today’s economy, only 24 percent of respondents remained focused on environmental practices.
For a full copy of The Cost of Control insight study, please visit


Zebra Gen 2 UHF RFID Card Printers Used by epcSolutions

June 11, 2009

As we have blogged about in the last several weeks, Zebra Technologies was the first company to offer card printers with Gen 2 RFID card printing/encoding capabilities. With extended range and applications, such as printing and encoding employee loyalty cards, membership cards, and security cards, it’s no wonder Zebra’s printers are being used by such firms as epcSolutions-the leading provider of RFID compliance software to Wal-Mart and DoD suppliers.

EpcSolutions offers a variety of products supporting the Zebra Gen 2 UHF RFID printers/encoders. One such product, FixedAssetManager, uses the Gen 2 RFID cards for items such as returnable totes and storage boxes to enhance file or document management. The product also uses RFID or barcodes to track fixed asset inventories like computers and furniture.

Another epcSolutions product, TetraGate, uses Zebra’s Gen 2 RFID cards to identify people and provide human access control. The technology helps make products more secure during distribution by combining UHF RFID technology inside an employee ID card with biometric facial recognition. TetraGate Lite, a similar product using Gen 2 RFID cards, was recently deployed to track students moving in and out of school buildings.

Meanwhile, epcSolutions’ WorkInProcessManager uses Gen 2 RFID cards to track the state and location of works-in-progress-from raw materials to finished goods-in real time. And RFIDTagManager allows Wal-Mart, Sam’s Club, Best Buy, and DoD suppliers to meet RFID mandates. Suppliers use point-and-click wizards to set up and configure their RFID hardware and then print and encode compliant RFID labels. RFIDTagManager uses Gen 2 RFID cards on returnable pallets used to ship tagged goods to Wal-Mart and the DoD.

With applications in asset tracking, access control, and inventory management, Zebra’s Gen 2 UHF RFID printers/encoders have become invaluable in warehouses and DCs around the world.

Supply Chain Management 2.0: Are we up for the challenge?

February 11, 2009

The term “Web 2.0” gained popularity signaled a change in the infancy of the World Wide Web, a time when we were making the transition from learning about the technology to beginning to get creative with its potential. Social networking and blogs, just like this one, redefine globalization. The community in which we work and live has no boundaries as we can make friends and generate leads from anyone in the world who has Internet access, which is approximately 1.5 billion people. And then came Supply Chain Management 2.0. I thought, at first, it was merely a spin-off of the popular buzzword. I admit I was wrong. SCM 2.0 is a powerful reminder that our distribution methods have become far more complex as a result of the globalized community. We need to be more aware of kinks in our systems that can drain the ROI, errors in picking and shipping, inefficient warehousing operations, and outdated software. As technology continues to move at lightning speed, if we aren’t making the effort to keep on top of the advances, we are going to be crushed under their weight. I’m still amazed at the businesses I work with that don’t have barcoding systems integrated into their operations. There are solutions for every level of business, from simple barcoding to voice picking to the sophisticated radio frequency identification, which is picking up speed as more and more managers are seeing the ROI on this technology. Have you stepped up to SCM 2.0 or are you still watching it from afar? If so, that distance is going to get wider and wider, until you are no longer seen by the connections that keep you in business.

If you would like to learn more about SCM, check out our Supply Chain Management Video Library in the links section on the left.