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Apr 03

Logistics Infrastructure

Posted on April 3, 2016 by Julian Blumenthal

When the word infrastructure comes up many of us think of roads, ports, waterways, railroads and maybe electricity and sewers. These are the basics of infrastructure and have been under invested in now for many years.  But infrastructure should also include the staging area of logistics.

The Georgia Port Authority recently invested in an inland ports in Cordele, GA and Murray County GA in northwest Georgia as a place to assembly freight going to and from Savannah, GA a growing port. By making it easier and more cost effective for local industries to serve the port, their business has a chance to grow, raising employment and increasing tax revenue.

And yes, there is a chance these investments no matter how well thought could fail.  In the present political and cynical climate, only overwhelming success can stop strong political criticism of projects like these. Additionally, individuals who may loss property or have their peace destroyed by industrial activities are sure to be opposed to projects like these.

My philosophy is that there is role for government to play as a catalyst and sometimes planner in these logistics projects. One of the fundamental goals of government should be (particularly in a democracy) is to do its part in economic growth.  Away from the supply chain, when you see a strong downtown area in a city it is almost always successful, because local government support was instrumental in its planning and success.  Yes, tax payers dollars were used but in these cases, investments were paid back by the growth in the local economy.

You can site examples on this on the federal level, interstate highways, and state level also such as the inland ports mentioned above. Relatively rarely, unfortunately, those the electorate think in these terms, but we should in the logistics community would be wise to support well researched and thought out projects.

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Mar 14

Sometimes Zigzagging Works

Posted on March 14, 2016 by Julian Blumenthal

The inspiration of this article came from two different venues, the Bible and college basketball. In the telling of Exodus. God directs the Israelites  out of Egypt on a zigzag course deliberately, so as avoiding an immediate battle with the Philistines, which they were not prepared to fight in the days after leaving Egypt (Exodus 13:17).  It was a strategic zigzag from a direct route to allow success further down the line.

Oh yes, college basketball. A guard takes the ball down the court. An opposing player stands between the guard and the basket. The guard goes forward, the opposing guard retreats with him.  The guard pauses and zigzags back, with the opposing player still back pedaling. There is now space to make an uncontested shot to the basket.

The strategic and well thought out zigzag or pause is one of the tools supply chain and logistics managers have.  Its use is dependent on understanding what other players in the situation would likely do. Using the zigzag or the pause,  increases your value as a manager to the corporation and is something a computer logarithm is unlikely to be able to do. Here are some examples.

Let’s say you want the firm to pay for a new software which will have the potential to significantly improve your operation.  Assume further, your company is in a temporary cash crunch. If you push the software now to upper management and finance people, they will likely say “no” and that “no” may even prevent future review of the software. So timing your presentation to a better company cash situation will likely improve the chances the software will be funded.

Managers having to put out fires of an operation problem.  Sometimes, if they just wait a few hours,  the situation may be resolved to the customer’s and organization’s satisfaction at lower cost than if do something immediately.  You may take some heat, but if you are ultimately successful, people will remember the success and not the heat.

Probably the best use of the zigzag or the pause is implementing major changes in an organization.  It is normal for people to resist change and by pausing to get buy in the project might work better. An historical example, Abraham Lincoln’s issuing of the Emaciation Proclamation. He might of wanted to do so on day one of his Presidency, but doing this would have lead to his being blamed for the succession of the South. He waited for year and half into Presidency before issuing preliminary documentation in September 1862. He did when he felt the political time was right for issuing the Proclamation, when it had a good chance for success.

In certain situations, if after reviewing what outside parties are doing and/or thinking, a pause or a zigzag in managing a situation may be appropriate.

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Mar 03

Not near my backyard

Posted on March 3, 2016 by Julian Blumenthal

I was at a networking meeting telling people I work in logistics, and stranger listening responded saying nobody wants trailers near them.

I was curious what that meant. With a bit of conversation, it was learned that the firms he deals with are having problems keeping truck trailers in their lots because nearby residents complaining about them being unsightly and a nuisance.  Those of us making a living either arranging transportation of the trailers or filling them with goods to go somewhere, might have a more romantic and positive view of truck trailers, but not so nearby residents.

In addition to visual issues, noise truck operations create is a significant issue. Many times the truck noises are at night, engine humming, brakes humming, and things going bang in the night.

As a supply change or logistics specialist and manager, more so than most management positions you are outward facing. Responsible organizations know that in addition to being responsive to share holders, customers and employees, being a good neighbor is important to continuing sustainability of operations.

Being aware of actual and potential issues in the community your businesses function, is an important value you can bring to the firm. Being outward facing and in the supply chain, you can bring value to your organization anticipating and responding to these challenges. Respectful attitudes must be maintained even when others may not be.

I like to continually write about individuals who add value to the organization, in a way which can not easily outsourced to robots, software or other organizations. Handling these type of issues, making top management aware of these concerns, and providing good solutions all speak to one more reason why a firm needs you and not another robot or software.

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Feb 17

Filling Supply Chain Jobs

Posted on February 17, 2016 by Julian Blumenthal

Community Colleges across the country are starting to fill a need for supply chain training. Last week I attended a Council of Supply Chain Management Professionals (CSCMP) session at Harper College in Palatine, IL near Chicago where this was topic of the day.  CSCMP is a professional supply chain organization.

I attended decades ago Penn State and received a MBA with a major in logistics. There are of course a number great universities across the country providing supply chain training, the current buzz word for this field. There is a level of knowledge and educational sophistication these programs provide. They can be useful for high paying jobs in large organizations, global in size, billions of revenue and complex. However not every organization needs that level of talent or can afford to pay for it, but do need supply chain skills, knowledge and work ethic.

The featured company at the event was Innovative Components of Schaumberg, IL. They make knobs. There website is knobsource.com.  They have two plants, one here in Illinois, and one in Costa Rica.  They have a need for educated and trained work force in the supply chain, people who know the concepts and vocabulary and can meet the needs of this relatively small organization when compared to the multi-national behemoths.

Harper College offers certificate courses in Procurement and Supply Management, Transportation and Logistics, Warehouse Operations, Demand Planning, Inventory and Production Control, and Supply Chain Analytics.  Connected to these programs are CSCMP exams which are benchmark exams which be recognized by many companies as marker of knowledge and skill, which will be better known throughout the country than the Harper College name and add credence to the certificate program.

Many manufactures are short skilled people to run their operations. No longer can a non-degreed person just walk in and just do repetitive tasks on assembly line or just call a truckline to ship. Manufacturing jobs do pay living wages as they are skilled jobs in demand.  But their suppliers and customers may be fairly sophisticated and they will need suppliers and customers who can understand their issues.

One of the points the representatives of students are telling high schoolers and young community college students is that not all jobs require going into tens of thousand of 4 year college debt to be able to get to the point where one is employable.

Harper College administrators and faculty, as is typical in community colleges come from people who have actually worked in the field, who are not just teaching a “textbook” because of their experience and practical knowledge.

 

Posted in Learning from failure, Logistics, Supply Chain Education, Transportation, Warehousing | Tagged | Leave a comment
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Feb 09

Its In the Details

Posted on February 9, 2016 by Julian Blumenthal

The attached article is a good essay on why details are so important to transportation shipments.

https://www.linkedin.com/pulse/unsung-heroes-supply-chain-management-transportation-becker-pmp-mba?published=t

In the world of import-exports there are ways to get big fines for your organization, which not only money for the fine itself, but the significant amount of time its takes the organization to resolve any of these issues.

It is important that software used account for these details of shipment.  The software can be used to remind and enforce procedures. That is all well and beneficial, but training in the organization, formal and informal, must teach the underlying fundamentals.  The transportation manager and personnel must be aware so I can handle new marketing issues as they come up or handle unanticipated events in a professional fashion.

 

Posted in Export, Import, Inventory planning, Learning from failure, Process Management, Supply Chain, Supply Chain Education | Tagged | Leave a comment
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Jan 26

Combating the Sounds of Silence

Posted on January 26, 2016 by Julian Blumenthal

In the supply chain and logistics, your job success depends not only on your own work but whether you can get others inside and outside your organization to work together on ways to increase efficiency and resolve problems that come up.  It is very dependent on people listening and hearing each other.  The data on your computer systems generate is only good if people uses it wisely.

Yes, there are times people will refuse to listen.  More often it is the case that a person does not even realize he or she is not listening. There is a silence there which is invisible with all clutter going on in everybody’s work life.  You probably not their direct line boss, so you cannot force them to listen, therefore one must provide benefits and reasons to listen.

Below are some thoughts on how to deal with this sounds of silence, but first here is how not to deal with it: telling people off, condensing to them, screaming and shouting, and plotting conspiracies to make that person’s life difficult. You are in this for long haul, and you will need these people support in the future.  People remember how you treat them. Logistics and supply chain have lots of details needed to be done right and they are easy to ignore.

Here are some keys to getting people to want to listen and hear.

  1. Know what the project or work objective is and why this is being done, and be prepared to clearly explain it. People will put no voluntary effort into any activity if its value is unclear and its objective unclear.
  2. Use your knowledge and empathy to understand what the person you are dealing is trying to accomplish in their job and what sort of work dynamic they are dealing with (i.e. is this peak season?).   Projects and work objectives has to placed in a context of their job, otherwise it will have no relevancy to them. Again, typically you are not their boss and you do not have power over them.  To get buy in, there must be some understanding why working together will be of benefit.
  3. Develop questions on the project that will help bring out barriers and concerns these persons will have.  Many of us, have been in situations where it is better to keep our concerns to oneself, but these concerns are landmines which could destroy the project and keep from being successful. Well placed questions will help break down this barrier of silence.  Respect the person and the experience of the people you need to work with.
  4. Provide feedback which is the best way to show that person concerns are being addressed and the project is moving forward.

There is one other element that is important. Be enjoyable to talk to. Who wants to talk to anybody who is difficult?  Part of being enjoyable to communicate with is making it easy for dialogue and communications to take place.  Respond to instant messengers, emails and phone calls on a timely basis. If you are too busy to respond, the other person will be too busy also.

 

 

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Jan 15

Business Interruption Insurance and the Supply Chain

Posted on January 15, 2016 by Julian Blumenthal

There has been a lot written about planning for supply chain risk and resilient supply chains. Insurers looking to cut claim costs on business interruption insurance now realize planning for supply chain risk and resilience cut significantly cut claim costs in the advent of business interruption.  That is, if the company has such a plan.

If you work in a large firm, say over $500 million in revenue, it likely lead to your insurance department and possible top management asking already about what plans are in place in the case of disruption.

For smaller businesses, whom may never had put together a supply chain risk and resilient planning, this may be start to be a new requirement.

Looking at this from another angle, where management may not wanted to spend money on risk planning and resilient planning, now it has a financial incentive.  It could be a tangible cost which can be reduced by appropriate planning.  By showing better sustainability of the organization, business interruption insurance costs saves can occur.

 

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Jan 04

Cybersecurity and Sustainability

Posted on January 4, 2016 by Julian Blumenthal

Ted Kopel, formerly of Nightline, recently released book entitled: Lights Out: A Cyberattack, A Nation Unprepared, Surviving the Aftermath describes enemies of the country taking out the US electric power system by hacking their computers. He envisions months of no power, with extreme food shortages and other major consequences.

Looking at this from a supply chain / logistics perspective the potential for cyber attack seems credible, but the slow response does not.  Supply chain risks is something a lot has been written about. Certainly, loss of data and loss of computer services is one of those risks. In preparing for this back up and restart procedures must be part of the planning process before any potential bad thing happens.

I have no inside information, but I am sure electric power companies have thought about this, and have back up and restart procedures in place. The US electric grid is vast and complex, just like many supply chains. That means there are alternatives available and alternate processes, and no one attack is likely to close down everything.

So planning for loss of IT services should be part of your planning in your supply chain. There will be some time frame involved for restart, an priorities are best established in advance, so you don’t have to start from scratch in a chaotic situation.  Your organization cannot probably exist through a long term shut down. It is part of sustainability planning to be aware of this situation.

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Dec 09

Millennials

Posted on December 9, 2015 by Julian Blumenthal

I been really impressed by the number of newspaper and internet editors bashing millennials since the incident at the University of Missouri, where a football boycott lead to the resignation of the University President. Article after article appeared complaining about how millennials are cuddled by helicopter parents and how they are not prepared for the world.

It causes me to smile inside as being a baby boomer, myself, in the Vietnam, Civil Rights era many in the older generation at that time had some choice words for us. Now some baby boomers having not learned the lesson and are repeating the error.

As leaders in the supply chain, no matter what your title, you can not be caught in such negative thinking. If your employee shows promise but might be deficit in a particular area, invest your time in the appropriate training and mentoring. Older members of the work force who will soon be leaving it, are responsible for passing on the positive aspects of the organizations culture. It is a legacy you can leave.

Two short stories to end this post. Jeff Silver of Coyette Logistics which hires a lot of people out of college has said he is impressed with the quality of people he is getting.

One of the criticism of millennials is their short attention span and lack of oral communication skills. Kevin Wilson, the coach of Indiana University’s football team says he had train his players to talk because communication is essential to be successful in a team sport.  And as they have learned these skills, he talks how enjoyable it is to coach them. So being supportive can make your job more satisfying and successful.

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Nov 16

The Case of the Missing Lean

Posted on November 16, 2015 by Julian Blumenthal

Why is  “lean” missing.  “Lean” like the goal to minimize inventories, removal of inventory waste. Why are the 2015 statistics for  inventories up in an environment where everyone is told to minimize inventory.  Why is the “lean” missing?

Who brought this case to my attention?  Some background first: I attended a Chicago Roundtable CSCMP event (Council of Supply Chain Management Professionals) meeting on Thursday November 12, featuring the well respected author, Rosalyn Wilson,  who is the lead author for the annual State of Logistics Report. She reported that so far in 2015 inventories are growing, which inversely effects economic growth.  Mike Regan, the  Chief of Relational Development at Tranzact, and leading supply chain authority asked Ms. Wilson (and I am paraphrasing here)  ” In a world where is lean inventory principles are drummed into everybody’s heads, how could inventory grow as greatly as it has?”  A deep mystery, I present you the case of the missing “lean”.

Rosalyn Wilson responded and I will add additional comments also.

  1. Retailers are concerned about the inventory on the shelves but demand suppliers keep inventory at the supplier’s distribution center and adsorb the  cost until they, the retailer, are ready for it. So holistically, inventories in the system are going up. They remain hidden somewhat cause retailer does not have the direct cost until delivery.  While it does make sense to keep inventories as far back as possible to lower costs in the supply chain process. I can illustrate that by saying engine parts are lower inventory cost than the assembled engine. So why are supplier inventories going up?
  2. Rosalyn Wilson also talked about supply chain demand software being linear in a non-linear world. Is it reasonable for software to predict a scandal causing Volkswagen would sharply lower demand or predict a terrorist attack in Paris? At the end of the day, software is written by humans and is designed to cover most likely scenarios.  People need to be involved in the demand planning no matter what the software does. It is sometimes too easy to let the software do its job, particularly when it is “normal” times it does a far superior job of inventory control. But humans do need to be involved when expected dramatic changes occur.
  3. I will add there are many firms, maybe a majority who have manual processes for demand many times ia let’s continue to do what we did yesterday (which worked out then).  Lean process have made major penetration in many manufacturing processes, but not all by long shot. The smaller the organization, the less likely they can afford sophistication in demand planning. But yes managers need to use their intelligence in manual processes also.

One of the best practices I have seen is for companies to have a pre-assigned committee of managers from various parts of the business, be available for respond when the environment changes and the software can not be counted on for good demand predictions.  Their experience particularly working through a number of changed environment will lead the firm to good decisions, and there will be no mystery about how to change when the demand demands it.

 

 

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