Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsExtending Lean Supply Chain Think...
Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsPaul Myerson has been a successfu...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systems                 Transcription of...
Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsJoe: What I noticed about your ba...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsalso feel thats part of the suppl...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsinventory is used to cover a lot ...
Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsJoe: I think about it from a mark...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsall work is a process, so its not...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsmost, supply chain was viewed as ...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsmake pennies on the dollar, so we...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsit reduces that bullwhip effect s...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsit. But instead of just focusing ...
Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsJoe: Youre a major partner of a s...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsjust let the system run its not g...
Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsJoe: You can practically get data...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemstechnology thats what they call c...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systemsdone many of these, hundred, in m...
Business901                      Podcast TranscriptionImplementing Lean Marketing SystemsPaul: Its, of course, at McGraw-H...
Business901                      Podcast TranscriptionImplementing Lean Marketing Systems                                 ...
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Lean Supply Chain and Logistics Management

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Paul Myerson was my guest on the Business901 Podcast, Extending Lean Supply Chain Thinking. Paul recently authored Lean Supply Chain and Logistics Management, a practical guide that will assist you in leveraging your improvements to both vendors and customers. Along the way, you may pick a few other Lean Tips to improve operations in general. I found it an enjoyable read and one that will find little opportunity to gather dust on my bookshelf.

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Transcript of "Lean Supply Chain and Logistics Management"

  1. 1. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsExtending Lean Supply Chain Thinking Guest was Paul Myerson Related Podcast: Extending Lean Supply Chain Thinking Extending Lean Supply Chain Thinking Copyright Business901
  2. 2. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsPaul Myerson has been a successful change catalyst for clientsand organizations of all sizes. He has more than 25 years ofexperience in supply chain strategies, systems, and operationsthat have resulted in bottom-line improvements for companiessuch as General Electric, Unilever, and Church and Dwight. He iscurrently Managing Partner at Logistics Planning Associates, LLC,a supply chain planning software and consulting business(www.psjplanner.com).Lean Supply Chain and Logistics Management providesexplanations of both basic and advanced Lean tools, as we as specific Lean implementation opportunities. Real-world examples and case studies demonstrate how to effectively use this powerful strategy to realize significant, long term improvements and bottom-line- savings. This practical guide reveals how to identify and eliminate waste in any organizations supply chain and logistic function. Paul is a leading supply chain and logistics management expert with consulting, teaching, training and industry experience.He combined all aspects of Lean - Lean tools, methodologies,keys to success, and provides complete coverage of all functionalareas of supply chain and logistics management, to enable thereader not only to begin the Lean SCM journey but sustain it intothe future, where the ultimate rewards of increasedcompetitiveness and profitability are attained. Extending Lean Supply Chain Thinking Copyright Business901
  3. 3. Business901 Podcast TranscriptionImplementing Lean Marketing Systems Transcription of the PodcastJoe Dager: Welcome everyone! This is Joe Dager, the host ofthe Business901 podcast. With me today is Paul Myerson. Paulhas recently authored a book, "Lean Supply Chain and LogisticsManagement," where he uses his 25 plus years of experience toprovide explanations of specific Lean implementations andopportunities. Paul, I would like to welcome you. Could you tellthe audience about yourself and what prompted you to write thebook?Paul Myerson: Sure, Joe. Its great to be here today. Mybackground - I have a lengthy background in supply chain andlogistics. Ive an undergraduate degree in logistics from PennState University, MBA in distribution from Temple University. Iveworked with many large companies in the supply chain andlogistics area - General Electric, Unilever, Church and Dwight,which is Arm and Hammer, worked in Big five consulting withKPMG. Back in the late 90s, I started my own supply chainsoftware and consulting business. Along the way, I got heavilyinvolved in Lean manufacturing, training and implementation, andsome consulting. In the last five to seven years, Lean first movedinto the administrative area. In the last three to five years, itsmoved heavily into the supply chain and logistics area, which is agreat fit.Around that time period, I came up with the idea that I had useda lot of Lean simulation games for Lean manufacturing. I thought,"Well, theres not one for Lean supply chains." I came up withone. Its now published at enna.com. After I did that, I thought,"Well, why not write a book on it?" I came up with the idea for abook. I had some contacts at McGraw-Hill and some otherpublishers through my teachings as an Adjunct Professor. I got acouple offers to write the book, so I went ahead and pickedMcGraw-Hill and thats where we are today. Extending Lean Supply Chain Thinking Copyright Business901
  4. 4. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsJoe: What I noticed about your background, I thought, what aperfect fit for a Lean guy. You have been as much of a teacher asyou have been a consultant.Paul: I have a very diverse background. Through my career,Ive worked in every aspect of supply chain and logistics at thecorporate and at the manufacturing level. I have a lot ofexperience in that field. Ive also done teaching, as youmentioned. Ive been an Adjunct Professor at Kean University, atNew Jersey City University and a couple others in the past. Ivealso been involved in consulting. Ive been a practitioner, atrainer; I actually sell software as well as design it in the supplychain area. I really have touched on so many areas. I did a lot ofLean work in manufacturing. As I said, Ive started in the lastnumber of years to actually do it in supply chain and logistics, aswell as Lean office.Joe: Can we start out with a basic question and define thecommonality and the differences between supply chain andlogistics, just for the sake of this conversation?Paul: Sure. As I write in my book, theres even in the academiccircles, but certainly in industry, theres some confusion. Manypeople will take the definition of supply chain as procurement.They think of it as purchasing or procurement. Some people willunderstand that it includes logistics, in other words, inbound andoutbound transportation and distribution. I tend to like to refer toit as supply chain and logistics management just so people get afull feel and dont think its just procurement and purchasing. Inmy book what I did to take it even further, I liked the SCOR®model, which is, if youre not familiar with that, that definessupply chain in areas, breaks it up as plan, source, make, deliverand return. That really gives you a broad feel for supply chainand logistics. I also include areas that maybe some people mightconsider manufacturing, the forecasting, planning and scheduling.But I include that partially because thats my background, but I Extending Lean Supply Chain Thinking Copyright Business901
  5. 5. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsalso feel thats part of the supply chain job is to make sureeverything flows and is in sync all the way along the supply chain.Joe: I think thats one of the big secrets. Let me put it this way.I think that you can have a great supply chain, if youve got agreat forecast, right?Paul: Right! Like I said, all forecasts are wrong; you just want tominimize the variability. I was talking about that in my class theother day, thats a key thing. Forecast drives an organization inso many ways -- strategically, operationally and tactically -- at alllevels the details. Thats really a driver. To me, thats part of thatsupply chain process.Joe: When we think about lean, we always think about pull. Isforecasting the pull for a supply chain?Paul: The combination of forecasts and customer demand arethe “pull”. I became involved in this in the early ’90′s, with whatthey call “Quick Response.” which is now typically referred to as“CPFR” (collaborative planning forecasting and replenishment),which is basically working with your customers to developaccurate forecasts by getting to actual point of sales data,warehouse withdrawals, etc., and using that information to havea much improved forecast. My thinking is, if you can get your top20 customers going through some kind of Quick Response/CPFRprogram, you’re at least collaborating on the forecast andimproving its accuracy, in addition to managing their inventory ofyour products and even placing orders for them.That top 20 customers could be 80 percent of your forecast. Youcould then minimize what they call the “bullwhip effect,” wherethings get magnified upstream in the supply chain causingdisruption. You can help to get closer to actual demand and buildthat into your forecast and have a much more accurate forecast.That’s one major step to becoming leaner because we know Extending Lean Supply Chain Thinking Copyright Business901
  6. 6. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsinventory is used to cover a lot of things, including variability indemand and lead time.Joe: You’re saying the secret to good supply chain is gettingdeeper with your customers?Paul: Right. It’s very important to have an efficient supply chainwhich can give you a competitive advantage, and with technologytoday, it’s a lot easier to accomplish. These days, you hear a lotof the terms like “visibility” and “collaboration.” It’s critical tohave visibility downstream in your supply chain towards thecustomer and upstream with suppliers. Maybe it’s not a secretanymore because a lot of people are doing it, but I think someorganizations still look at it as more of a cost center where “ourcustomer wants us to collaborate or work with them on forecastsor manage or place their orders for them.” You have to look at itas a competitive advantage, a strategic choice to go that route toimprove not just your process with your customer and makethem happy, but to improve your process and also your suppliers’processes.Joe: The one thing you mention is the customers downstream.Ive always noticed that in a supply chain, thats the terminologyused, but really shouldnt the customer be at the beginning?Paul: Well, yes! Basically, thats why, its like I said, somepeople talk about the demand chain. Its all really part of thesame. Its actually the customer buying the product off the shelfis the start of it, through a true pull system. They use theexample, in manufacturing, of Dell computers being amass-customization. Thats a true pull system, at least the onlinesystem they have, when you place an order within 24 hours theyassemble and test and ship the product. They have supplierslocated nearby that basically; they talk hours of supply not daysor weeks of supply. Thats the ultimate in a pull system, so itsvery Lean. Extending Lean Supply Chain Thinking Copyright Business901
  7. 7. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsJoe: I think about it from a marketing perspective -- this may bea little off subject, but it seems to fit in right now -- I have alwaysthought that re-shoring and things would happen as a supplychain needed to be shortened. Part of that is that that philosophyof getting close to the customer, allowing the options andvariability to be part of the customer demand, meaning that youhave to strategically located resources to respond to that or local,not necessarily in a sense, but local in the global sense. Are youseeing any of that? Is there any truth in that?Paul: Im not sure I fully understand your question, but I knowoperations or supply chain, there are a couple options. You havedemand options and supply options to meet your capacityconstraints, in the case of demand options, to smooth thedemand out. One of them is I know, Proctor & Gamble years ago,co-located something like 200 employees at Wal-Mart inBentonville, Arkansas, to basically collaborate on forecasting.They basically tried - I dont know if they eliminated, but theyreduced -- they went to every day pricing because heavilypromoting products, you basically create your own bullwhip effectand seasonality, if you will. Working with the customers, as Isaid, to not just predict demand, but actually influence it canreally be a great marketing tool, as well as help you strategicallyand tactically in your operations.Joe: How does Lean enter into all this?Paul: I take a broader definition of Lean. I think inmanufacturing its pretty clear what Lean is. Its a team-basedapproach to continuous improvement, where youre focusing onvalue as defined by the customer in trying to minimize non-valueadded activities in your processes -- things that dont add valueto the customer, but actually take up most of your cycle. In thesupply chain area, its the same definition. Its identification andelimination of waste or non-value added activities. As they say, Extending Lean Supply Chain Thinking Copyright Business901
  8. 8. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsall work is a process, so its not that much different for supplychain than for manufacturing, but there are nuances.For example, in an office, an admin type application, timebetween each step in a process... In Lean in manufacturing, youllinventory in terms of days of supply as being met with the wasteor covering up for some of the waste. In an office, it might bedwelt on how long it takes to process an order.If it takes a full day to go through the four or five steps in anoffice and its done in batches, what can we do? It fits in betweeneach step in someones in box. You look at, what can you do?Why is it being batched? What can you do to get the one-pieceflow, so the orders can come through much quicker? Even if youjust cut off a half hour, its that much quicker the order can getout to the warehouse to ship, and you get paid that muchquicker, it can get even greater from one day to a half a day,thats even a bigger improvement.Its about continuous improvement. It applies to so many areasof the supply chain. Historically, companies fought within the fourwalls of their manufacturing plant. Now, in Lean Supply Chain,you look beyond that into your office, your warehouse, yourcustomers and your suppliers.Joe: Is it easier to be doing Lean in manufacturing before youstart utilizing it in the supply chain?Paul: I dont want to say its easier. Its been done for a longertime, obviously. But, absolutely, you first want to get your acttogether within your four walls of your facility or yourmanufacturing process. Historically, they have a thing calledvalue stream mapping. Its like a process flow map, but in Leanterms it actually breaks up the value-added and the non-valueadded steps in a process. Historically, companies look at fromwhen they receive material into the plant to when they produce itand it goes into inventory or ships to a customer. Maybe, at the Extending Lean Supply Chain Thinking Copyright Business901
  9. 9. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsmost, supply chain was viewed as one little box on that valuestream map as a warehouse, so now, its expanded beyond that.Once you get your act together within your four walls, then youcan start looking in more detail at the warehouse at both theout-product flows through the warehouse, the receiving, putaway, picking, shipping, loading trucks, the routing of trucks, theinformation in terms of tracing and shipping, going backwards toyour suppliers, the same thing.You even have to help your suppliers in terms of training to helpthem. If you Lean out your own manufacturing process, and thenyou start working with your suppliers, if you dont do it properly,youre just passing on your problems to them. Youre going tosay, "OK, were ready to now take smaller quantities more oftenbecause were Leaner," but then your manufacturer, yoursupplier, is basically stuck holding more inventory for you. Insome cases, you have to work with them, so that they canproduce in smaller lot sizes and ship more frequently and run insmaller production cycles.Joe: Can you incorporate that same thinking that you have withvendors, with customers, too?Paul: Oh, absolutely! Thats primarily, when we talked about theCPFR, working with customers, thats how I view it. In terms ofworking with customers to be Lean, it depends on what kind ofcustomer. If your customer is a retailer, obviously, its a littledifferent. You can work with them, in terms of their warehouse. Iremember years ago, when I was with Arm & Hammer. This wasearly in the quick response business, where we had visibility intowhat inventory they had in their warehouse and what theirpoint-of-sales data was for Arm & Hammer products, we basicallyhad to place.You think of a store. They have hundreds of thousands of SKUs,so they couldnt possibly do a good job managing it. They only Extending Lean Supply Chain Thinking Copyright Business901
  10. 10. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsmake pennies on the dollar, so we worked with; in this case, itwas a Wakefern Shoprite. We looked into the warehouse and wecould actually see; they had Arm & Hammer products. Someitems, they had a years supply. Other items, they were out ofstock.Once we took over, we were able to actually manage it so muchbetter. We had a better presence of our product. We were neverout of stock. We carried two, three, four weeks of supply. Wewere placing the orders before them. In effect, we were helpingthem become Leaner and have less inventory, less quality issues,less out of stock, things like that. Its kind of a win/win situationwith our customer, in that case.Joe: It sounds like a great opportunity for sales and marketingpeople to really expand on by getting deeper with the customer.Those are significant relationships you build up by doing it thatway.Paul: Oh, absolutely. Quick response started in the apparelindustry, I think, in the late 80s. So some people are alreadydoing this kind of thing and they dont need to think of it as Lean.Again, I take a lot of the thoughts and concepts and things thathave been going on and kind of put them under this Leanumbrella. But its certainly a competitive advantage. I think thekey thing is that companies, like a manufacturer, have to thinkabout and say, "Well, maybe I have to have a few more planners.I have to create a structure where marketing and sales andoperations work together as a team to go to the customer and tryto sell this as, Hey, we can help you manage your inventorybetter."Its going to cost you something in the short run in terms ofmaybe I have to have an extra planner or have some moremeetings or effort or travel time. But in the long term, as I said, Extending Lean Supply Chain Thinking Copyright Business901
  11. 11. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsit reduces that bullwhip effect so your customer gets Leaner, youget Leaner, and everybody wins.Joe: Why is Lean so popular in the supply field? There areTheory of Constraints, Demand-Driven planning but Lean seemsto be the popular methodology out there.Paul: As I said, I think its relatively new in supply chain in thelast, lets say, five years where its taken off. If you think back,historically, the term "supply chain" didnt even come about untilthe early 80s and that was a result of, if you remember the 80s,thats when U.S. manufacturing was drying up and people wereoutsourcing both manufacturing and if not the wholemanufacturing process but supply . Their outsourcing ended upgetting materials and components from South America, China,Asia, etc. That made the supply chain much lengthier, complex.Around then came the 90s and you started gettingtools -- ecommerce and the Internet and ERP systems -- youstarted getting tools to help deal with that complexity but stilltheres a lot of waste in that process. Theres a lot of risk in it,too.I think people see that historically its an opportunity, because ofthat, to improve it and make it better. Thats one aspect of it, Ithink. Thats why its become more an area that you want tofocus on.Just in general, if you think about it, most companies,manufacturers, their supply chain logistics costs are 50 to 70percent of their sales dollar. So thats the natural place you lookfor to reduce costs.But the thing is, people have always focused on cost and theyonly get so far. If you use the Lean perspective you go beyondjust cost and you start looking at the processes and what addsvalue to the customer. You end up, maybe, with lower costsbecause you have a more efficient supply chain with less waste in Extending Lean Supply Chain Thinking Copyright Business901
  12. 12. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsit. But instead of just focusing on cost and negotiating a lowerand lower price where you get to a point where you just cant getmore blood out of a stone versus if you look at the process andtry to take the waste out of that you can make some radicalimprovements.Joe: I probably have a lot of listeners that are familiar with the“Theory of Constraint principles." Can you tell me how a Leansupply chain might be a little different then... or what you talkabout in your book is that any different than the drum, buffer,rope of the Theory of Constraints?Paul: I think you can apply it to that. With Theory of Constraintsyou look at bottlenecks and that limits your capacity orthroughput. I think you have to look at your supply chain thesame way. There might be a bottleneck. The bottleneck might behow many vehicles you can get and if you have your fleet, or howmuch throughput you can get through a warehouse and, well, Imat capacity with my warehouse so thats kind of a bottleneck. Somost people think, "I need to expand my warehouse or move itinto another area or rent out extra space or what have you"instead of saying "Why do I have so much inventory in the firstplace?" because if I go to that warehouse most of its sitting therefor quite a while.I think you can apply the same concepts of bottlenecks and thedrum, buffer, rope, and all that to it. Its just a little different.Youve just got to look at it a little differently. But I think itcertainly applies.And then, within a facility, whether its an office or a warehouse,for example, there are bottlenecks and things that limit yourcapacity. Whether it is people, equipment, or material you haveto look at it and see what you can do to remove the non-valueout of activities or the things you can do with a bottleneck toadjust it. Extending Lean Supply Chain Thinking Copyright Business901
  13. 13. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsJoe: Youre a major partner of a supply chain planning companyand the software you have is PSI Planner, I believe. Is technologythe answer in developing a better process?Paul: What I always say is technology enables a process. Youhave to have a good foundation, a good process, to begin with.Thats usually the first thing you should look at. And again, Leancan help you to do that. You start looking at your process andwhere there are waste and non-value activities. You also have tobring in best practices and they have to work for you. You justcant copy what other people do. That being said, if you have thisprocess or you want to change your process to a best practice thesoftware technology can help you to get there. You dont want tojust have a bad process and try to slap some technology on it.Its probably not going to work too well.Joe: Do people become too reliant on the software sometimes?Paul: Ive seen cases of this. Nike is kind of an example. Peoplethat treat this software as a black box, almost magical, and justlet it run. For forecasting, for example, forecasting and planning,at Nike there was a classic example a ways back. They basicallybought, I think, I2 software and they kind of let it run like a blackbox and they ended up writing off, I think, $160 million worth ofsneakers and they blamed the software. They sued I2. But thereality is you have to have a good process to begin with. You alsohave to fit the right software to your process because all softwareis not the same. You have to do the proper job of selecting thesoftware and thats often not the case, determining what ourfunctional requirements are.Then you have to do the proper training and implementation. Ifpeople arent trained and software, even though its user friendly,theres a lot of switches and settings and if you dont understandthe theories behind those settings and how to manage it and you Extending Lean Supply Chain Thinking Copyright Business901
  14. 14. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsjust let the system run its not going to give you, necessarily,good ends. Catch it, like in Nikes case, when its too late.Joe: We talk about supply chain and we always talk aboutmeasurements. I hear about the lagging measurements which arealready too late. I hear people say youve got to put leadingmeasurements in. But leading measurements are tough to definesometimes. Can you name a few of them that would be in thesupply chain?Paul: There are plenty of measurements. The SCOR model, forexample -- with the plan, source, make, deliver, return -- theyveactually developed a model, within that model metric, for each ofthose activities. I guess when you talk about leading I think itsas much companies that have dashboards that are up to theminute, knowing whats going on currently, today, and more realtime. That lets you have a better handle on the situation. Whenyoure able to then drill down into that dashboard which has kindof summary data, whether its on-time deliveries, inventory turns,those kinds of things. Warehouse cases, it might be cases perhour. Youve got to be on top of it and measure it.Ive been to some companies, at least in manufacturing, whereyou see a lot of measurements that they collect and you look onthe boards and the paper is all yellow and the data is months old.Thats not going to help you. That just doesnt help you.On the other hand, you dont want to go to the extreme ofparalysis by analysis where you over measure. Youve got to pickthe right measurements that apply to each situation and getthem as real time as possible.Thats the advantage of systems these days. A long time ago itused to be a lot of work to do that. These days, you can grab thedata thats close to real time, if not real time, easily and quicklyin any area of supply chain that you want to look at. Thats whatsimportant to me. Extending Lean Supply Chain Thinking Copyright Business901
  15. 15. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsJoe: You can practically get data as they scan it coming off ofthe cash register aisle, cant you?Paul: Oh, absolutely. Yeah. In fact, companies like Wal-Mart usewhats called RFID, Radio Frequency Identification. Thats to trackdata when trucks come in so you can move the product throughyour warehouse; they call it cross docking, quickly. Ive read thatWal-Mart is now looking to put these RFIDs, which are computerchips, at the vendor when it ships. So theyll even have moredetailed data before it even ships that they can grab and checkthe data, not just the barcode but much, much more data on anRFID chip. So thats the way to go.Joe: What are some of the other newer trends in supply chainthinking?Paul: I think its not so much trends. I think technology isdriving a lot of it. You hear about cross docking. I was at a clientup in north Jersey. They are a major toy retailer and 30 to 40percent of what they do is cross docking where product, within 24to 48 hours, comes in the door and goes out to the stores. Therest of it sits there for who knows how many weeks or months.But cross docking is -- I dont know about a trend, I think itsbeen around a while. I think its picked up steam. Wal-Mart doesit a lot. It increases the velocity of inventory through the supplychain. But using technology like RFID to help improve that flowand get control and know where product is and where it is goinghelps you to do that.As I said, the CPFR is still moving along. I dont know that itsmoved as fast. I think a lot of companies need to understand thatits to their advantage; its just not like a cost center. Its actuallyan advantage to collaborate with customers, at least your largercustomers. And again, technology can help you with that as well.With this international supply chain, being able to track and traceand control and measure online, theres a big trend, I guess, in Extending Lean Supply Chain Thinking Copyright Business901
  16. 16. Business901 Podcast TranscriptionImplementing Lean Marketing Systemstechnology thats what they call cloud software. Its a rentsoftware instead of own it. Its based on the Internet, thesoftware, so you dont have to install or maintain it. You can usethat for, these days, any application. ERP systems or it can justbe supply chain planning systems or for internationaltransportation management systems.So thats kind of a trend. I think that hasnt taken off as fast assome people thought cloud software, probably largely because ofthe security issue people think there is. Im not quite sure its asbig an issue as they think but thats probably a big issue. Socloud software is something that I think is going to keep growing.Joe: Whats the first step in applying Lean to your supply chain?What would you recommend someone taking a look at?Paul: In all Lean programs, or even continuous improvementapproaches to improving a process, the first step is you have tohave management buy-in; it cant just be a fad. We all knowLean has been around a long time. Maybe it wasnt called Leanbut Just-In-Time and a lot of the different tools. So you canttreat it as a fad. You have to understand that its a long termthing. Americans tend to think, "Well, its going to be a homerun." You cant think that way. Its continuous improvement.Youre going to make incremental improvements so you have tohave that management support. You want to get training to asmany people in your organization as possible so you can kind ofbuild that groundswell of support; basic Lean training toeverybody.Then you want to build a Lean structure. You want to have peoplethat are known as Lean champions. A Lean champion, you mightjust have one for your company, who kind of coordinates things.You might have Lean coordinators.Typically, the first step after that basic stuff like that is to do,what I recommend is doing a Lean opportunity assessment. Ive Extending Lean Supply Chain Thinking Copyright Business901
  17. 17. Business901 Podcast TranscriptionImplementing Lean Marketing Systemsdone many of these, hundred, in manufacturing but you can alsodo them in your supply chain because thats kind of "OK, now wehave all this training and were really excited, now what?"Whether you have consultants or trainers come in to help youfacilitate that or you do it yourself.In my book I have some downloads of slides for training of Leansupply chain but also a download of an example of a template, anXL template, for Lean supply chain opportunity assessment.You can talk about what are the processes. Is it this warehouse?Is it the loading trucks? Is it the order management? You maybego out and youll actually measure and see where you stand, kindof benchmark it. Then you can pick the areas that have the mostopportunity for improvement and start there.Joe: What were you hoping for someone to get out of yourbook?Paul: The comments Ive gotten back in reviews and commentsfrom magazine reviews and also reader reviews is that a lot ofpeople talk in language that we dont understand and make it toocomplex. They use words we dont know. Most people that haveread it, in the reviews say that its very easy to understand. Itend to break things down into their simplest terms. Some peopleuse the term "handbook," that its a good handbook, a referencebook. I would like people to say this is something thats an easyread and then its something I can go back to and I can actuallyuse it to implement Lean in my company. Its got some slidesthat I can do some training. Its got some Lean assessments Ican use. It explains how I do a value stream map in some simpleterms and, in supply chain, what are some opportunities. It reallygets you thinking and gives you the basic tools to get going rightaway.Joe: Where is your book available, Paul? Extending Lean Supply Chain Thinking Copyright Business901
  18. 18. Business901 Podcast TranscriptionImplementing Lean Marketing SystemsPaul: Its, of course, at McGraw-Hill professional. Amazon.com isprobably the best place to get it. You can just look up "Myerson"and "Lean" and itll bring up the book for you. Its available as aneBook as well.Joe: I would like to thank you, Paul, for your time and yourefforts. "Lean Supply Chain Logistics Management" book isavailable, like you said, on Amazon. This podcast will be availablein the Business901 iTunes store and the Business901 blog site.Thanks again.Paul: Thank you. I enjoyed it. Extending Lean Supply Chain Thinking Copyright Business901
  19. 19. Business901 Podcast TranscriptionImplementing Lean Marketing Systems Joseph T. Dager Lean Marketing Systems Ph: 260-438-0411 Fax: 260-818-2022 Email: jtdager@business901.com Web/Blog: http://www.business901.com Twitter: @business901 What others say: In the past 20 years, Joe and I have collaborated on many difficult issues. Joes ability to combine his expertise with "out of the box"thinking is unsurpassed. He has always delivered quickly, cost effectivelyand with ingenuity. A brilliant mind that is always a pleasure to work with."James R.Joe Dager is President of Business901, a progressive company providingdirection in areas such as Lean Marketing, Product Marketing, ProductLaunches and Re-Launches. As a Lean Six Sigma Black Belt,Business901 provides and implements marketing, project and performanceplanning methodologies in small businesses. The simplicity of a singleflexible model will create clarity for your staff and as a result betterexecution. My goal is to allow you spend your time on the need versus theplan.An example of how we may work: Business901 could start with aconsulting style utilizing an individual from your organization or a virtualassistance that is well versed in our principles. We have capabilities toplug virtually any marketing function into your process immediately. Asproficiencies develop, Business901 moves into a coach’s role supporting theprocess as needed. The goal of implementing a system is that the processeswill become a habit and not an event. Business901 Podcast Opportunity Expert Status Extending Lean Supply Chain Thinking Copyright Business901

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