The Logistics of Logistics

JUNE 14, 2024

trillion distortion inventory problem. Trillion Inventory Distortion Problem In this podcast, Karl Swensen, CEO and Co-founder of Pull Logic, discusses how their AI-enabled technology helps retailers, brands, and manufacturers reduce lost sales by addressing supply chain and selling process failure points. Summary: Solving the $1.8

Inventory Reduction 227

Inventory Reduction Inventory Inventory Management Software Modeling 227

Supply Chain Shaman

MAY 25, 2024

The use of orbit charts allowed me to see the patterns of performance at the intersection of metrics over time. By charting the performance against peer groups, I could see the story. The first step was to find a reliable data set and establish the peer groups. The second step of establishing peer groups was trickier.

Eliminating Excel in Purchasing 318

Eliminating Excel in Purchasing Gartner Supply Chain Design Supply Chain Strategy 318

Supply Chain Shaman

APRIL 27, 2022

At each company, there is a relationship between the metrics of growth, margin, inventory, customer service, and asset strategy. For the purpose of this article, I will use Return on Invested Capital (ROIC) as the proxy metric to discuss asset utilization.) Understanding this relationship requires modeling. (A A Case Study.

Procurement Analytics 339

Procurement Analytics Manufacturing Procurement Supply Chain Planning Software Supply Chain Design Software 339

Supply Chain Shaman

MARCH 21, 2024

The Company was attempting to gain economies of scale by grouping manufacturing technologies within a common infrastructure to reap the benefits of a co-generation facility, a centralized warehouse, and a talented administrative team. In my forty years of studying supply chain planning, the groups became larger, but with questionable results.

Inventory Reduction 403

Inventory Reduction Supply Chain Planning Software Cost Reduction Strategies Supply Chain Design Software 403

Supply Chain Shaman

JUNE 29, 2021

Using balance sheet data from 2011 to 2019, we chart companies’ progress by peer group on rate of improvement and performance in the metrics of growth, operating margin, inventory turns, and Return on Invested Capital (ROIC). A focus on functional metrics throws the supply chain out of balance.)

Supply Chain Planning Software 370

Supply Chain Planning Software Supply Chain Design Software Supply Chain Planning Supply Chain Design 370

Supply Chain Shaman

SEPTEMBER 3, 2018

Over the last six years, we studied the connection between business results (growth, operating margin, inventory turns and Return on Invested Capital (ROIC)) and the link to company characteristics. The technology group wanted to implement SAP IBP, and the business leaders were resistant. Reward teams for cross-functional metrics.

Supply Chain Planning Software 317

Supply Chain Planning Software Supply Chain Design Software Agile and Lean Supply Chain Supply Chain Software 317

Supply Chain Shaman

JANUARY 9, 2024

They are unconscious that they are underperforming their peer group and have not driven industry improvement. An average margin of 21% with inventory turns of 1.58 Sanofi Performance Versus Peer Group for 2013-2022 Similarly, I find 35% of companies following the pack not able to drive resilience in the face of market shifts.

Supply Chain Planning Software 299

Supply Chain Planning Software Pharmaceutical Supply Chain Planning Gartner 299

Supply Chain Shaman

JULY 25, 2021

Only four percent of companies outperformed their peer groups. Orbit Chart of Four Industry Sectors at the Intersection of Operating Margin and Inventory Turns (Year-over-Year Averages for the Sector). Lack of Focus on Form & Function of Inventory and Designing Network Flows. How could the industry spend 1.7%

Procurement Analytics 370

Procurement Analytics Supply Chain Design Software Agile and Lean Supply Chain Supply Chain Planning Software 370

Supply Chain Shaman

APRIL 9, 2021

Rise in Inventories. Less Effective at Inventory Management. Inventories grew twenty days over the decade. Yes, companies held more inventory (measured in days of inventory) in 2019 than at the start of the 2007 recession. Sadly, most of it is the wrong inventory. Despite spending 1.1% Alignment Barriers.

Supply Chain Planning Software 360

Supply Chain Planning Software Procurement Analytics Supply Chain Performance Manufacturing Procurement 360

Supply Chain Shaman

JANUARY 2, 2024

We talk about the move from functional metrics to a balanced scorecard, but we don’t use a balanced scorecard as an objective function. They underperform in their peer groups against companies weaker in planning. Orbit charts of four companies for the period of 2013-2022 at the intersection of operating margin and inventory turns.

Gartner 284

Gartner Supply Chain Planning Software Supply Chain Design Software Case Study 284

Supply Chain Shaman

SEPTEMBER 9, 2014

It is the end of a two-year research project, and identifies which publicly held companies outperformed their peer group on balance sheet results. We built peer groups based on like industries. How did you define peer groups? As a result, we report their results along with their pharmaceutical peer group.

Pharmaceutical 274

Pharmaceutical Gartner Supply Chain Design Software Supply Chain Design 274

Supply Chain Shaman

JANUARY 8, 2024

When compared to the peer group performance, smaller and regional players outperform larger companies. Intuitive Surgical, L’Oreal, and Sleep Number drove excellence through product and service innovation to outperform their peer groups. The supply chain has two important buffers–inventory and capacity.

Supply Chain Design Software 243

Supply Chain Design Software Supply Chain Planning Software Modeling Software Supply Chain Network Software 243

Logility

MAY 22, 2020

The obvious danger of this is that business rules and data governance often don’t exist from department to department or user to user, leaving an overall picture into the health of the business that is foggy because KPIs and metrics do not correlate across the organization. A great example of this comes from a Logility customer.

Analytics Software 148

Analytics Software Metrics Supply Chain Design Software Supply Chain Software 148

Supply Chain Shaman

MARCH 19, 2014

As an analyst in the market for the past ten years (first with Gartner, then with AMR Research, followed by my work at Altimeter Group and now with my own firm Supply Chain Insights), I have stood in front of clients doing strategy days advocating “best practices” and I wanted to set the record straight. It was an awakening.

Gartner 315

Gartner Supply Chain Planning Software Supply Chain Strategy Supply Chain Software 315

Supply Chain Shaman

NOVEMBER 21, 2023

My client attempted to have a supply chain discussion to improve flow, and his executive group just did not get it. In the early 1980s, As a result, we did not have a perpetual inventory signal. Without a perpetual inventory signal, we were never synchronized on where to place customer orders. The metrics were not aligned.

Supply Chain Planning Software 339

Supply Chain Planning Software Inventory Reduction Supply Chain Design Software Cost Reduction Strategies 339

Logistics Viewpoints

DECEMBER 15, 2022

The idea is that data points within a group share similar properties, and each group is different (statistically speaking) from another. Retailers can apply cluster analysis techniques in different ways to find groups of customers, products, stores, or suppliers that behave similarly. The retail industry is rich with data.

Optimal Sourcing 220

Optimal Sourcing Analysis Procurement Analytics Purchasing Skills 220

Supply Chain Shaman

MAY 22, 2013

The research tries to establish “ who did supply chain best ” by looking at a weighted formula of Year-over-Year Growth, Return on Assets (ROA), and Inventory Turns for the Fortune 500 companies. Inventory Turns values are based on an average of quarterly reporting for the past year. Inventory Turns is only part of the story.

Gartner 254

Gartner Pharmaceutical Supply Chain Chemicals 254

Supply Chain Shaman

NOVEMBER 21, 2024

Yawn and walk on if the answer is i mproving demand error or reducing inventory levels. On December 5th, Supply Chain Insights is hosting a small event at Georgia Tech to share the results of a two-year research effort to connect financial metrics by industry to supply chain performance to drive value.

Supply Chain Planning Software 367

Supply Chain Planning Software Modeling Software Modeling Supply Chain Network Software 367

Supply Chain Shaman

OCTOBER 29, 2014

Groupthink is a psychological phenomenon that occurs within a group of people in which there is a desire for harmony within the group, but the result is an irrational or dysfunctional outcome. I feel that the industry is engaged in ‘Group Think’ No one in this meetings is going to ask tough questions.

Supply Chain Planning Software 312

Supply Chain Planning Software Modeling Demand Planning Software Optimization Software 312

Supply Chain Shaman

OCTOBER 22, 2015

The impact of complexity on inventory is not quick. To help, today I want to share some of the insights from our recent Inventory Optimization study. Inventory management is a hot issue. Companies invest in project after project, yet inventory levels remain the same. The Business Problem. The analogy is weight loss.

Inventory Reduction 150

Inventory Reduction Supply Chain Design Software Inventory Supply Chain Planning Software 150

Logility

AUGUST 5, 2021

But before you start measuring everything in sight – and a few things not in sight – start with a set of thoughtful intentions and questions that will guide you to the right set of metrics and the right set of expectations. Inventory-based KPIs probably make sense for you, but how will you benchmark results? That’s a trap.

Metrics 130

Metrics Modeling Supply Chain Planning Software Supply Chain Design Software 130

Supply Chain Shaman

OCTOBER 20, 2012

When new groups come together, the forming process is often awkward. ” In this team activity, people who do not know each other list four statements and ask the group to guess which statement is false. .” ” I played three lies and a truth with the group. Here they are: The Lie of Inventory Reduction.

Inventory Reduction 262

Inventory Reduction Cost Reduction Strategies Resource Reduction Material Savings 262

Supply Chain Shaman

AUGUST 12, 2020

I struggled to manage myself as I settled in elbow-to-elbow with the group to listen to the presentation. The methodology did not include a peer group analysis, and I strongly felt that chemical, retail, and telecommunications companies should not be compared in the same analysis. Orbit Chart of Lenovo Performance Against Peer Group.

Gartner 243

Gartner Supply Chain Software Procurement Analytics Manufacturing Procurement 243

Supply Chain Shaman

JULY 6, 2020

Tom, the colorful warehouse manager, constantly heckled Frank for the increasing inventory levels while Ed, the quiet material/logistics manager, constantly questioned if there was a better way. He felt that inventory was no problem, he would just cut it at the end of each quarter to make the balance sheet goals. The So What?

Agile and Lean Supply Chain 297

Agile and Lean Supply Chain Supply Chain Design Software Supply Chain Planning Software Supply Chain Strategy 297

Supply Chain Shaman

OCTOBER 5, 2018

The award, based on beating the industry peer group on rate of improvement on the key metrics of growth, operating margin, inventory turns, and Return on Invested Capital (ROIC) while outperforming their peer group, is tough to achieve. Orbit Chart for L’Oréal at the Intersection of Inventory Turns and Operating Margin.

Case Study 261

Case Study Inventory Reduction Agile and Lean Supply Chain Study 261

Supply Chain Shaman

APRIL 16, 2014

I have taken myself off the road to write the book Metrics That Matter. On the 2nd of April, I sat before a board discussing how a company could exceed expectations in the delivery of Return on Invested Capital (ROIC) and superior operating margins and fail at the delivery of customer service and inventory. It is a slow week.

Supply Chain Design Software 279

Supply Chain Design Software Agile and Lean Supply Chain Modeling Supply Chain Planning Software 279

Supply Chain Shaman

OCTOBER 25, 2013

It is a quest and the subject of my next book, Metrics That Matter , that will publish in September, 2014. We have found that nine out of ten organizations are stuck on their ability to make improvements on both operating margin and inventory turns in the same year. .” As I shuffle along, I am not sure. I shake my head.

Gartner 258

Gartner Supply Chain Strategy Supply Chain Software Supply Chain 258

Supply Chain Shaman

JUNE 19, 2018

It is now our fifth year of analyzing balance sheets to understand which companies are outperforming their peer groups on the metrics of growth, operating margin, inventory turns and Return on Invested Capital (ROIC) while driving improvement. This is the fun part of my job. This work is not easy. Today, it is not.

Gartner 211

Gartner Supply Chain Design Software Supply Chain Design Supply Chain Strategy 211

AIMMS

FEBRUARY 20, 2015

Interview with Lora Cecere, Founder and CEO of Supply Chain Insights and Author of Supply Chain Metrics that Matter ( published December 2014 ). Her supply chain experience includes specialist roles at AMR Research, Clorox, Gartner Group, Kraft, and Procter & Gamble. Metrics that Matter became a three year research project.

Metrics 120

Metrics Supply Chain Planning Software Supply Chain Design Software Supply Chain Software 120

Supply Chain Shaman

MARCH 27, 2014

I also continued to work on the manuscript for the book Metrics That Matter to publish in the fall of 2014. This is a networking group that meets by phone once a month. The average client that has implemented demand sensing technologies has reduced inventory by 11%. The book is now a very worn manuscript. It makes a difference.

Supply and Demand 282

Supply and Demand Inventory Reduction Demand Planning Software Forecasting Software 282

Logistics Viewpoints

FEBRUARY 16, 2021

And the impact doesn’t stop there, since trade-off decisions will be required to answer questions like which customer is most important to satisfy with the limited bolts in inventory and if production capacity should be reallocated. And then decisions on these questions will in turn affect other customers in your rattled supply chain.

Supply Chain Visibility 316

Supply Chain Visibility Agile and Lean Supply Chain Supply Chain Planning Software Scenario Planning 316

Supply Chain Shaman

DECEMBER 7, 2022

Over time, I used this group as a research panel to better understand the choices made by supply chain leaders and what made a difference in balance sheet performance. Colgate outperformed P&G in Return on Invested Capital (ROIC), and P&G exceeded Colgate in inventory turns. I give thanks for this experience.

Inventory Reduction 55

Inventory Reduction Material Savings Supply Chain Strategy Price Mitigation Strategies 55

Supply Chain Shaman

JANUARY 14, 2013

Year after year, well intentioned people toiled against improving metrics that reduced, not improved, the effectiveness of the supply chain. ERP is valuable to improve transactional accuracy, but I can find no evidence that investments in ERP have reduced inventory or improved cash-to-cash cycles. Metrics comparison of Kellogg Co.

Supply Chain Planning Software 260

Supply Chain Planning Software Supply Chain Design Software Optimal Sourcing Modeling 260

Supply Chain Shaman

MAY 14, 2013

This week, at Supply Chain Insights LLC, we published our 11th report in the series titled Supply Chain Metrics That Matter. Financial ratios allow us to analyze performance across the peer group (large against small companies) and across currencies. We also look for companies that have out-performed their peer groups.

Supply Chain Design Software 256

Supply Chain Design Software Supply Chain Planning Software Optimal Sourcing Supply Chain Design 256

Supply Chain Shaman

NOVEMBER 9, 2014

It was my first time working with this group. The group laughed. ” The group was quiet as we discussed the fact in the traditional organization that functional silos are not designed to work together. I also believed that this company would have the best inventory and customer service. The first name is Irish.

Manufacturing Procurement 286

Manufacturing Procurement Optimal Sourcing Benchmarking Supply Chain Design Software 286

Supply Chain Shaman

JUNE 29, 2014

It could no longer be just about inventory levels. This analysis needed to be completed monthly and fed to newer forms of inventory optimization technologies. I smiled as I began to present the story of the “Metrics that Matter.” Market-Driven llamasoft Metrics That Matter network design value-based design'

Supply Chain Design Software 268

Supply Chain Design Software Supply Chain Design Network Design Software Supply Chain Planning Software 268

Supply Chain Shaman

AUGUST 30, 2014

2) The focus needs to be on driving a balanced portfolio of metrics that goes across the organization. Team members need to be held equally accountable for growth, inventory, profitability, customer service, and forecast accuracy. Demand Supply Chain alignment inventory turns Sales and operations planning' Why It Matters.

S&OP 268

S&OP Supply Chain Planning Software Supply Chain Planning Forecasting Software 268