Imagine starting a supply chain from scratch

Last week, the Chicago Roundtable of the Council of Supply Chain Management Professionals (CSCMP) visited Magid Glove in Romeoville, IL.  Magid had a number of stories to tell about moving from an old outdated facilities in Chicago, IL to a new facility in a southwest suburb of Chicago, Romeoville, IL.  Their business is to make, distribute and sell safety productive clothing, with a specialization of various types of safety gloves.

To me the visit could be summarized on their second floor, where on one side of the building is a sophisticated tote conveyor system for storage and retrieval of products and other side the same floor are women working sewing machines with items moved between work stations in laundry baskets. Rarely have I seen such stark contrasts together  in the same building but to me it represented common sense planning.  How can that be? We will get there.

As a private company, it is easier to make long term calls to improve your performance when the firm don’t have investors only interested in quarterly profits.  Magid decided a US presence was needed to stay in business and it wanted to be close to Chicago to keep its skilled workforce and managers. Maintaining its quality of workmanship was deemed an important core company value to be sustainable in its market. It knew its presence workforce was skilled in providing that quality. To keep the employees they stayed in the Chicago market.

Rarely does an organization have the opportunity to redesign your operation from scratch. This was one of those times. One story is that process from moving from old building to new one. They started with their purpose in the marketplace: High quality, individualized safety clothing products shipped promptly and correctly to the customer. For these type of low volume supplies, customers are not getting to do a large amount of planning, so when something breaks or a surge in business comes, they will need the product right now to maintain their production. As this is safety equipment, it must perform as advertised for both moral and certainly legal reasons. So while Magid has a plant in the Philippines, it is too far away to timely ship to the US market.

While machines can make the basic glove, the extra fabrics and detail needed to make a safety glove safe, in the small batch requirements of the customers, it was felt best to have individual people sewing the needed safety details to the glove.   These small batches  can be moved to work stations by sophisticated conveyor machines or robots, but would there be any real savings or any real improvement in productivity?

But the story in the distribution warehouse was quite different. Not only did have the own products to sell but they sold complementary products from other firms. In their distribution system with a lot small quality sku’s, a sophisticated tote conveyor system was chosen to significantly cuts down on storage space needed and speeds the product through the warehouse. It also improved order accuracy.  The investment was large, but the return on investment was quick.

The 30,000 feet view story here is that organizations can’t do everything, especially everything at once with not only limited cash but also limited management resources, even in a starting from scratch situation.  The organization must choose what it thinks would give it the biggest bang for the buck, improving its distribution system in the warehouse. Time will allow the firm to approach other process improvements.

There is a lot of technology out there: the internet of things, SOP, ERP, WMS, TMS, robots, and artificial intelligence among others. Maybe, all them would help your company be more efficient. There is not enough cash nor management personnel to implement everything. The wise managers will prioritize improvements based on what will help the business be successful to meeting customer needs and expectations, where to modernize and where to put off.

 

 

 

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