Want to avoid summer stagnation? To help you stay informed during the summer months and close the year with impact, we prepared a list of our most popular content for your reading and viewing pleasure. The list includes trending blog posts, our latest webinar and a brand-new Buyer’s Guide for S&OP. Read on to get all the goodies.
From import tariffs to the next tsunami: how Prescriptive Analytics can help you build agility and resilience into your Supply Chain Network
In a world full of turmoil, change has become the new normal. New import tariffs being introduced across the globe, extreme weather events, Brexit… The list goes on and on. What can Supply Chain leaders do to mitigate the risks that these disruptions bring to the Supply Chain? Businesses are constantly reminded that they need to be more agile and resilient in order to survive. But what does this mean when it comes to Supply Chain Network Design?
Sales and Operations Planning has become a standard process to improve business performance, collaboration and predictability. In fact, it’s become internalized to a degree that companies often have several (competing) S&OP processes in different geographies & business units. Why is it that despite its popularity, only 42% of companies rate their S&OP process as effective?
The food supply chain is complex and challenging. Changing consumer preferences, rising competition and new technologies are compelling food companies to rethink their approach to supply chain management. AIMMS formed a partnership with CAT Squared and UniSoma to help companies in the food industry tackle these challenges. The first product of this partnership is TacticalOps, a Planning & Optimization solution for Food Manufacturers. I spoke with Luis Pinto, Partner at UniSoma, to understand the need for new planning and optimization solutions in the global food supply chain.
KFC, a fast food favorite, made headlines last month for suffering a chicken shortage that brought 900 restaurants in the UK to a halt. Recently, the chain announced it was suffering from a gravy shortage as well. Not ideal for a chicken restaurant. No chicken and no gravy mean no customers. The whole debacle could have cost Yum! Brands Inc., KFC’s Parent company, up to £1m in losses per day. Not to mention a PR crisis that, despite a cheeky apology, will follow the company for years to come. What went wrong?
For three decades now I have been helping my clients with their Supply Chain questions….I have seen a lot of change along my journey. Some of my early projects included initiatives like helping large retailers transform from a pure paper-based operation inside their 4 walls to a first-generation Warehouse Management System (WMS). I also helped my clients with Sales & Operations Planning and with Distribution Network Design and Transportation Optimization Projects, to name just a few. In the past, all of these projects shared a few common traits including long, tedious and expensive implementations involving small armies of consultants. It would take a long time and a lot of money before businesses could see improvement. That is not the case any longer. Today, I am happy to say that I am still helping clients make better decisions. The big difference is AIMMS. Today, with our Agile approach and extremely cost-effective cloud native technology, my clients are using our software in a matter of days to improve their business.
The chemical industry is facing some powerful changes that are directly impacting revenues and margins. It’s also highly competitive. Everyone is trying to dominate their niche. This means chemical companies need to be adept at managing costs and profitability. But doing this ad hoc is too difficult. Having the right technology is key.
Spreadsheets and legacy tools are no longer enough
There’s a lot of flux in the chemical industry. Raw material prices fluctuate constantly. Selling prices vary depending on international markets and what’s happening in certain countries. That margin between selling prices and raw material prices needs to be carefully managed.
At the same time, the industry is consolidating and changing rapidly. As mergers and acquisitions increase, managing demand in large geographies becomes even more complex. Companies that spin off due to M&A activity need to find ways to manage their own destiny. Many chemical companies are using S&OP (Sales & Operations Planning) as a tool to tie up operational planning and activity with financial goals and strategy. Many are still using spreadsheets and legacy tools to support this process. These tools may provide a good starting point for S&OP, but do not always provide the sustainability or flexibility that companies require to be agile during times of rapid change.
In today’s business environment, you can’t remain competitive without mastering analytics. Still, most companies are “not very far” when it comes to implementing analytics and garnering benefits from data, as a recent survey from CSCMP suggests. In many cases, organizations haven’t succeeded in making the organizational changes required to become data-driven. Not enough managers are fluent in the language of analytics. Leveraging analytics at scale is hard. As the graph below shows, lack of talent, investment in hardware/software and siloed data are among the most common challenges.
AIMMS has been active in the supply chain space for over 28 years. We’ve seen the evolution of the industry and its ongoing transformation, and have embarked on a transformation ourselves. The skills of the past are no longer sufficient to meet the demands of today’s complex, fast-moving digital environment, or prepare for the future. There is also a talent shortage. As the most experienced supply chain professionals retire, CSCMP estimates that as many as 3.5 million positions may go unfilled by 2020. The competition for talent is tough, as “demand for supply chain professionals is estimated to exceed supply by a ratio of six to one.” Here are three things you can do to attract and leverage talent for the digital supply chain.
According to a recent Wall Street Journal article, finance chiefs are cutting back on Excel because it hasn’t “kept up with the demands of contemporary corporate finance units.” “I don’t want financial planning people spending their time importing and exporting and manipulating data, I want them to focus on what is the data telling us” – Adobe Inc.’s finance chief Mark Garrett tells WSJ journalist Tatyana Shumsky. This mood prevails among supply chain executives as well.
Spreadsheets still dominate planning in the supply chain. We recently commissioned Supply Chain Insights to conduct independent research on supply chain network design, and 65% of the companies surveyed are reportedly using spreadsheets to support this process. Spreadsheets are familiar, inexpensive and convenient. But they pose serious setbacks for organizations:
- They are practically never integrated with other systems
- They are not updated automatically
- The logic behind them is often only clear to those who create them and often dies when somebody leaves, making collaboration difficult
- Analyses are often slow given that you can only work with a certain amount of data
- Version control is hard