Presentation at the Terra Technology conference march 27
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Presentation at the Terra Technology conference march 27

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Presentation given by Lora Cecere at the Terra TechnologyConference on March 28, 2012

Presentation given by Lora Cecere at the Terra TechnologyConference on March 28, 2012

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  • 1. Supply Chain InsightsDelivering Insights to Line of Business Leaders Supply Chain Insights, LLC © 2012
  • 2. BRICKS Book Publishes Matter in August 2012 The Role of Supply Chains in Building Market-Driven Differentiation LORA M. CECERE CHARLES W. CHASE JR.
  • 3. Supply ChainA supply chain is a complex system withcomplex processes with increasingcomplexity. Supply Chain Insights, LLC © 2012
  • 4. 4 Who does it Best? SC Excellence 38% 21% 17% 4% 4%P&G Apple Dell Wal-Mart Toyota Supply Chain Insights, LLC © 2012
  • 5. 5What wereTipping Points Points? the Tipping 52% 36% 20% 16% 8% Supply Chain Insights, LLC © 2012
  • 6. Supply Chain Tipping Points1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 JIT Supply Chain Internet/Email RFID Organization Evolution of eProcurement the PC Re-Engineering the Total Quality S&OP Organization Management Theory of Constraints (Michael Hammer)Supply Chain Excellence = Supply Chain Excellence = Islands of Manufacturing Vertical Silo Efficient Order to + + Excellence Excellence Excellence Cash Processes Inside-Out Inside-Out Supply Chain Insights, LLC © 2012
  • 7. Supply Chain Tipping Points 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 .com Social Responsibility Y2K Demand Driven Concepts CSCO Lean Six Sigma Market-Driven Value NetworksSupply Chain Excellence = Supply Chain Excellence = Vertical Silo Outsourcing Value-Based Outcomes + Excellence Effectiveness Delivered by Horizontal Processes Inside-Out Outside-In Supply Chain Insights, LLC © 2012
  • 8. What is a Market-driven Value Network?An adaptive network focused on a value-basedoutcome that senses and translates market changes(buy and sell-side markets) bi-directionally withnear-real time data latency to align sell, deliver,make and sourcing operations. 8 Supply Chain Insights, LLC © 2012
  • 9. What is Supply Chain Excellence? Supply Chain Insights, LLC © 2012
  • 10. Revenue/Employee in Consumer Products P&G Colgate Unilever Kimberly Clark700600500400300200100 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Supply Chain Insights, LLC © 2012
  • 11. EBIT/Employee P&G Colgate Unilever 140.0Earnings Before Interest and Taxes 120.0 100.0 80.0 60.0 40.0 20.0 0.0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Supply Chain Insights, LLC © 2012
  • 12. Comparison of EBIT/Employee Plotted Against Days of Inventory for P&G/Unilever for the Period of 2002-2010 P&G DOI P&G EBIT/Employee Unilever DOI Unilever EBIT/Employee140120100 80 60 40 20 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 Supply Chain Insights, LLC © 2012
  • 13. Cost of Sales as a Percent of Revenue Kellogg Kraft General Mills Campbell Hershey P&G 70% 65%Cost of Sales a Percentage of Revenue 60% 55% 50% 45% 40% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Supply Chain Insights, LLC © 2012
  • 14. Where are we Headed? Supply Chain Insights, LLC © 2012
  • 15. Supply Chain Insights, LLC © 2012
  • 16. Supply Chains Don’t Play by the Rules But, wh at if they could? 16 Supply Chain Insights, LLC © 2012
  • 17. Big Data Supply Chains are Evolving Challenges: Structured • Transactional Data • Time phased data Volume • SocialUnstructured • Channel Data • Customer Service • Warranty Velocity • Temperature Sensor • RFID Data • QR codes • GPS Variability New • Mapping and GPS • Video Data • Voice Types • Digital Images 17 Supply Chain Insights, LLC © 2012
  • 18. Evolution of Supply Chain Excellence ContinuousAlign Building Horizontal Connector Testing Learning Orchestrate Improving Adapt Resilient Reliable Right Product Efficient Sense Demand Demand Volatility and Supply Right Place Cost Shape Right Time Procure to Demand and Supply pay/order to Supply based Volatility cash on Market Right Cost Supply Chain Insights, LLC © 2012
  • 19. S&OP Evolution Greater Benefit Business- • GrowthSales Driven • Resilience planning DrivenMatch Demand • Efficiency Coordination with Supply of Plans Manufacturing- Demand Market Driven Driven Driven Orchestrate Deliver a Feasible Sense and Demand Plan for Operations Shape Demand Market to Market Supply Chain Insights, LLC © 2012
  • 20. Connecting the Extended Supply Chain Transactional Transactional Transactional Applications Applications Applications Trading Partner 1 Trading Partner 2 Trading Partner 3 20 Supply Chain Insights, LLC © 2012
  • 21. Evolving Supply Chain Architectures Collaborative Collaborative Collaborative Layer Layer Layer Transactional Transactional Transactional Applications Applications Applications Enterprise Data Enterprise Data Enterprise Data Warehouse Warehouse Warehouse Trading Partner 1 Trading Partner 2 Trading Partner 3Key: Supplier Signal Predictive Analytics Repository Demand Signal Transactional Adapters Repository and Intelligent Rule Sets 21 Supply Chain Insights, LLC © 2012
  • 22. Historically, we have: • Tried to get precise on inaccurate data • Believed that the most efficient supply chain is the most effective supply chain • Built efficient chains, but not effective networks • Wrongly defined the “R”s • Focused inside-out, not outside-in. • Rewarded the urgent, not the important • Responded without sensing. 22 Supply Chain Insights, LLC © 2012
  • 23. 23Thank you! Lora Cecere Lora.cecere@supplychaininsights.com Blog: www.supplychainshaman.com Twitter: lcecere Linkedin: linkedin.com/pub/loracecere/0/196/573 Supply Chain Insights, LLC © 2012