Thriving in a Changing Ecosystem<br />Finding Opportunity in Complexity<br />
Source: Aberdeen Group, February 2011<br />Our Rapidly Evolving Ecosystem<br />Global, Volatile, Unpredictable<br />
And CEO’s Expect it to Get Tougher…<br />Source: 2010 IBM Global CEO Study<br />Source: Aberdeen Group, February 2011<br /...
Where There is Chaos…Opportunity<br />
Caldwell’s<br />28%<br />of 2011 US holiday sales will include Smartphones in the shopping journey<br />Source: Logistics ...
Case in Point:<br />J&R Music recently introduced a mobile app to support shopping on the go and enhance the store experie...
 Customer Reviews
 Video Demos
 Deal of the Day
 Store Locator
 Order History</li></ul>Source: Logistics Viewpoints<br />Source: IDC Retail Insights<br />Consumers Expect Mobile Options...
the top ten Facebook brands added<br />115 MILLION FANS<br />Source: Logistics Viewpoints<br />in 2010<br />Source: IDC Re...
Case in Point:<br />Late last year, Proctor & Gamble began selling Pampers directly through Facebook…<br />Technology Enab...
“I’ll have a medium triple-shot, half-caff, no whip mocha… extra hot.”<br />Consumers Expect Personalization<br />From Cof...
“I’ll have a medium triple-shot, half-caff, no whip mocha… extra hot.”<br />Technology Enablers<br /><ul><li> Configurable...
 Collaboration </li></ul>Consumers Expect Personalization<br />From Coffee to Tennis Shoes, Everyone Wants to Express thei...
Relentless Globalization<br />Technology Enabler<br />All-Channel Platform<br />70M People<br />cross the threshold to the...
Consumer Responsiveness: 1958<br />Lag Time for Significant Changes in Store Demand to Cascade Across the Extended Supply ...
Consumer Responsiveness: Today<br />Lag Time for Significant Changes in Store Demand to Cascade Across the Extended Supply...
 CPFR</li></ul>Source: Logistics Viewpoints<br />Typical Out of Stocks at the Retail Shelf?<br />The Need for Speed -- and...
More and More Links in the Chain<br />And still only<br />7%<br />of manufacturers diligently optimizetheir global supply ...
 Data Integration Portals</li></ul>Manufacturers who diligently optimize their global supply networks are<br />73%<br />mo...
Supply Chain “Masters”Manage <br />75%<br />of their Supply Base througha Formal Process<br />Source: Accenture<br />A Pro...
84%<br />Employ a Supply-BaseSegmentation Approach<br />83%<br />Automate Tracking/Reporting of Supplier Performance<br />...
Technology Enablers<br /><ul><li> Supplier Performance
 Scorecards</li></ul>A Proliferation of Partners and Outsourcers<br />More Complexity, and (Possibly)  More Stability thro...
Supply Chain Shocks: Mother Nature<br />Highlighting the Importance of Planning for the Unplanned<br />“The damage to prod...
Supply Chain Shocks: Mother Nature<br />Highlighting the Importance of Planning for the Unplanned<br />“Due to power suppl...
 Configurable Workflow</li></li></ul><li>After the political unrest in Egypt, cotton prices were<br />171%<br />higher tha...
CEO’s of Companies with “Operational Dexterity” are<br />23%<br />more intent on achieving an optimal balance between glob...
5,678,000<br />The 124M product recalls in 2010 included…<br />pounds of beef<br />Supply Chain Shocks: Product Recalls<br...
93%<br />of consumers believe that recalls indicate whether companies care more about their own profits than they do about...
87%<br />of consumers are more likely to purchase products from companies that manage recalls in an “honest and responsibl...
 Track and Recover</li></ul>Source: Princeton University<br />Supply Chain Shocks: Product Recalls<br />Consumer Product S...
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Finding Opportunity in Supply Chain Complexity

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Today's global supply chains and hyper-connected consumers create unprecedented challenges for businesses in every industry, from food service to high tech to CPG to retail. RedPrairie CEO recently delivered this presentation to the 1,200 attendees of the Georgia Logistics Summit, where he described the challenges inherent in the ecosystem and highlighted opportunities within these challenges to earn competitive advantage.

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  • KEY TALKING POINTS-Recent events in the Middle East have also highlighted the need for flexible, agile supply chains that give us options when geopolitical turmoil interrupts the flow of goods -Egypt was one of the first countries this year to experience political unrest that eventually led to dramatic change in the government-Earlier widespread concerns were centered around the Suez Canal and the flow of oil out of the Middle East, but anyone in the apparel industry also had to keep a watchful eye on the flow of Egyptian cotton, as many brands/retailers depend on Egyptian cotton for high-end garments and textiles -Shortly after the crisis unfolded, cotton futures rose to prices 171% higher than one year prior -As most analysts don’t expect consumers to pay double for items made from cotton, will this signify a fundamental shift in the market, and if so, who will be there to take advantage of the shift?THE OPPORTUNITY-How do we find opportunity in a world where unrest appears to be a permanent part of the geopolitical landscape?-We must strive for agility and flexibility and look to balance our network between local and global resources -We must constantly monitor and evaluate geopolitical situations in geographies that are part of our ecosystem -We must develop networks and plans that build in contingency plans and potentially even safety stocks for mission critical components -We must strive for a manageable balance of global and local operations that manage both costs and risks-In short, we must strive for operational dexterity. Because that is where we can find competitive advantage and opportunity-The best-run supply chains already recognize the importance of finding the right balance -A recent CEO Survey found that companies that were found to have “operational dexterity” have a commitment to striking the right balance, and manage that balance as a daily part of their operations****ADD SECOND RESULT/PAYBACK DATA POINT FROM CEO STUDYBACKGROUNDhttp://public.dhe.ibm.com/common/ssi/ecm/en/gbe03297usen/GBE03297USEN.PDFGeo-Political Turmoil is another reality in today’s supply chains.Recent events in the middle east have highlighted the need for flexible, agile supply chains that give us options when the flow of goods is interrupted or prices move beyond tolerable fluctuation points. It is important to plan contingencies and strike the right balance between local, regional and global dependencies and resources. DHL (one of our customers) in February was impacted like everyone else in region, but services were only interrupted for one day.
  • Finding Opportunity in Supply Chain Complexity

    1. 1. Thriving in a Changing Ecosystem<br />Finding Opportunity in Complexity<br />
    2. 2. Source: Aberdeen Group, February 2011<br />Our Rapidly Evolving Ecosystem<br />Global, Volatile, Unpredictable<br />
    3. 3. And CEO’s Expect it to Get Tougher…<br />Source: 2010 IBM Global CEO Study<br />Source: Aberdeen Group, February 2011<br />Our Rapidly Evolving Ecosystem<br />Global, Volatile, Unpredictable<br />
    4. 4. Where There is Chaos…Opportunity<br />
    5. 5. Caldwell’s<br />28%<br />of 2011 US holiday sales will include Smartphones in the shopping journey<br />Source: Logistics Viewpoints<br />Source: IDC Retail Insights<br />Consumers Expect Mobile Options <br />Unprecedented Opportunities for those that Can Adapt Quickly to Changing Shopping Patterns<br />
    6. 6. Case in Point:<br />J&R Music recently introduced a mobile app to support shopping on the go and enhance the store experience…<br />Caldwell’s<br />Technology Enabler<br />All-Channel Platform<br /><ul><li> 320,000 Items
    7. 7. Customer Reviews
    8. 8. Video Demos
    9. 9. Deal of the Day
    10. 10. Store Locator
    11. 11. Order History</li></ul>Source: Logistics Viewpoints<br />Source: IDC Retail Insights<br />Consumers Expect Mobile Options <br />Unprecedented Opportunities for those that Can Adapt Quickly to Changing Shopping Patterns<br />
    12. 12. the top ten Facebook brands added<br />115 MILLION FANS<br />Source: Logistics Viewpoints<br />in 2010<br />Source: IDC Retail Insights<br />Consumers Expect Social Options <br />Unprecedented Opportunities for those that Can Adapt Quickly to Changing Shopping Patterns<br />
    13. 13. Case in Point:<br />Late last year, Proctor & Gamble began selling Pampers directly through Facebook…<br />Technology Enabler<br />All-Channel Platform<br />31,913 fans/month<br />1,000 orders/day<br />the top ten Facebook brands added<br />115 MILLION FANS<br />…and the results were impressive<br />Source: Logistics Viewpoints<br />in 2010<br />Source: IDC Retail Insights<br />Consumers Expect Social Options <br />Unprecedented Opportunities for those that Can Adapt Quickly to Changing Shopping Patterns<br />
    14. 14. “I’ll have a medium triple-shot, half-caff, no whip mocha… extra hot.”<br />Consumers Expect Personalization<br />From Coffee to Tennis Shoes, Everyone Wants to Express their Own Sense of Style<br />
    15. 15. “I’ll have a medium triple-shot, half-caff, no whip mocha… extra hot.”<br />Technology Enablers<br /><ul><li> Configurable Workflows
    16. 16. Collaboration </li></ul>Consumers Expect Personalization<br />From Coffee to Tennis Shoes, Everyone Wants to Express their Own Sense of Style<br />
    17. 17. Relentless Globalization<br />Technology Enabler<br />All-Channel Platform<br />70M People<br />cross the threshold to the middle class each year,and virtually all are in emerging economies<br />Source: Goldman Sachs<br />More Countries, More Complexity…More Customers<br />
    18. 18. Consumer Responsiveness: 1958<br />Lag Time for Significant Changes in Store Demand to Cascade Across the Extended Supply Chain?<br />6 Months<br />8-10%<br />Typical Out of Stocks at the Retail Shelf?<br />Source: Logistics Viewpoints<br />The Need for Speed -- and Accuracy<br />While Velocity has Improved, Unprecedented Opportunities Exist for those that Can Anticipate Demand Accurately<br />
    19. 19. Consumer Responsiveness: Today<br />Lag Time for Significant Changes in Store Demand to Cascade Across the Extended Supply Chain?<br />3-6 Weeks<br />Technology Enablers<br /><ul><li> Collaborative Forecasts
    20. 20. CPFR</li></ul>Source: Logistics Viewpoints<br />Typical Out of Stocks at the Retail Shelf?<br />The Need for Speed -- and Accuracy<br />Still 8-10%<br />While Velocity has Improved, Unprecedented Opportunities Exist for those that Can Anticipate Demand Accurately<br />
    21. 21. More and More Links in the Chain<br />And still only<br />7%<br />of manufacturers diligently optimizetheir global supply chain networks<br />Technology Enablers<br /><ul><li> Visibility/Collaboration
    22. 22. Data Integration Portals</li></ul>Manufacturers who diligently optimize their global supply networks are<br />73%<br />more profitable than their peers<br />Source: Deloitte<br />Manufacturers, Suppliers, Transporters, Wholesalers, Retailers, Consumers, Lenders…<br />
    23. 23. Supply Chain “Masters”Manage <br />75%<br />of their Supply Base througha Formal Process<br />Source: Accenture<br />A Proliferation of Partners and Outsourcers<br />More Complexity, and (Possibly) More Stability through Better Processes<br />
    24. 24. 84%<br />Employ a Supply-BaseSegmentation Approach<br />83%<br />Automate Tracking/Reporting of Supplier Performance<br />80%<br />Centrally Log and ProactivelyManage Supplier Contracts<br />Source: Accenture<br />A Proliferation of Partners and Outsourcers<br />More Complexity, and (Possibly) More Stability through Better Processes<br />
    25. 25. Technology Enablers<br /><ul><li> Supplier Performance
    26. 26. Scorecards</li></ul>A Proliferation of Partners and Outsourcers<br />More Complexity, and (Possibly) More Stability through Better Processes<br />
    27. 27. Supply Chain Shocks: Mother Nature<br />Highlighting the Importance of Planning for the Unplanned<br />“The damage to production facilities and on export goods themselves will likely continue for the next several months.”<br />
    28. 28. Supply Chain Shocks: Mother Nature<br />Highlighting the Importance of Planning for the Unplanned<br />“Due to power supply constraints expected in the summer, a full pickup in exports is unlikely until at least the end of this year”<br />Technology Enablers<br /><ul><li> Contingency Planning
    29. 29. Configurable Workflow</li></li></ul><li>After the political unrest in Egypt, cotton prices were<br />171%<br />higher than the year prior<br />Source: Wall Street Journal<br />Supply Chain Shocks: Geo-Political Turmoil<br />Striking a Balance between Global Integration and Local Relevance Leads to Agility<br />
    30. 30. CEO’s of Companies with “Operational Dexterity” are<br />23%<br />more intent on achieving an optimal balance between global and local markets<br />Source: IBM CEO Study 2010<br />Supply Chain Shocks: Geo-Political Turmoil<br />Striking a Balance between Global Integration and Local Relevance Leads to Agility<br />
    31. 31. 5,678,000<br />The 124M product recalls in 2010 included…<br />pounds of beef<br />Supply Chain Shocks: Product Recalls<br />Consumer Product Safety Improvement Act (2008), Food Safety Modernization Act (2011) Indicate Compliance and Recovery Plans are Now Table Stakes<br />
    32. 32. 93%<br />of consumers believe that recalls indicate whether companies care more about their own profits than they do about customer safety<br />Source: Princeton University<br />Supply Chain Shocks: Product Recalls<br />Consumer Product Safety Improvement Act (2008), Food Safety Modernization Act (2011) Indicate Compliance and Recovery Plans are Now Table Stakes<br />
    33. 33. 87%<br />of consumers are more likely to purchase products from companies that manage recalls in an “honest and responsible” way<br />Technology Enablers<br /><ul><li> Supplier Segmentation
    34. 34. Track and Recover</li></ul>Source: Princeton University<br />Supply Chain Shocks: Product Recalls<br />Consumer Product Safety Improvement Act (2008), Food Safety Modernization Act (2011) Indicate Compliance and Recovery Plans are Now Table Stakes<br />
    35. 35. The Mandate for Sustainability<br />93%<br />25%<br />of CEO’s View Sustainabilityas Critical to Success<br />of Consumers WouldSwitch Brands Givenan Ethical Alternative<br />Source: Accenture<br />Source: IBM Institute for Business Value<br />Future Guardianship, Risk Mitigation, Competitive Opportunity<br />
    36. 36. The Mandate for Sustainability<br />However…<br />32%<br />Conserving to Reduce Needfor Natural Resources<br />Technology Enabler<br />Green Dashboards<br />30%<br />Innovating to Shift Needfor Natural Resources<br />30%<br />Are Doing Nothing<br />Source: McKinsey Quarterly<br />Future Guardianship, Risk Mitigation, Competitive Opportunity<br />
    37. 37. Collaboration, Workforce Management, Workflow, All-Channel Commerce<br />Logistics Technologies Are Critical to Thriving in Today’s Ecosystem<br />
    38. 38. Real-World Example: Integrating a Highly Complex Supply Chain – from Farm to Table…<br />WORLD’S LARGEST MEAT PRODUCER<br />LARGEST US THIRD-PARTY COLD STORAGE<br />SECOND-LARGEST U.S. WHOLESALE GROCER <br /><ul><li> 140 Facilities
    39. 39. 5,000 Trucks
    40. 40. 182 Warehouses
    41. 41. 1.1B Cubic FT
    42. 42. 2,500 Outlets
    43. 43. 24 States</li></li></ul><li>Real-World Example: Integrating a Highly Complex Supply Chain – from Farm to Table…<br />WORLD’S LARGEST MEAT PRODUCER<br />LARGEST US THIRD-PARTY COLD STORAGE<br />SECOND-LARGEST U.S. WHOLESALE GROCER <br />COLLABORATION & CONTROL<br />Raw material tracking<br />Finished goods tracking<br />Lot and batch control<br />Fresh Item Management<br />Inventory accuracy<br />Workforce Management<br />Workforce Management<br />3PL Billing<br />
    44. 44. Real-World Example: Minimizing Disruption in the High-Stakes World of High-Tech…<br />WORLD’S SECOND-LARGEST CONTRACT MANUFACTURER<br />WORLD’S LARGEST THIRD-PARTY LOGISTICS PROVIDER<br />WORLD’S LARGEST ELECTRONICS RETAILER<br /><ul><li> 48M SQ FT
    45. 45. 30 Countries
    46. 46. 500 Sites
    47. 47. 15 Countries
    48. 48. 1,000 Stores
    49. 49. 10 Retail Brands</li></li></ul><li>Real-World Example: Minimizing Disruption in the High-Stakes World of High-Tech…<br />WORLD’S SECOND-LARGEST CONTRACT MANUFACTURER<br />WORLD’S LARGEST THIRD-PARTY LOGISTICS PROVIDER<br />WORLD’S LARGEST ELECTRONICS RETAILER<br />VISIBILITY & COLLABORATION<br />Component leveltracking<br />Serialization<br />Store Execution<br />Value added services<br />Bill of material<br />TransportationManagement<br />Order accuracy<br />Inventory accuracy<br />Workforce Management<br />Workforce Management<br />3PL Billing<br />
    50. 50. Greatest Positive Impact on Profits Next 5 Years?<br />51%<br />64%<br />Growth of Consumersin Emerging Economies<br />Shift of EconomicActivity Between Regions<br />63%<br />50%<br />Technologies that EmpowerConsumers & Communities<br />Increasingly GlobalMarkets for Labor/Talent<br />32%<br />52%<br />Consumer Demand for Corporate Responsibility<br />Increased Labor Productivityin Developing Markets<br />Source: McKinsey Quarterly, January 2011<br />Where There is Chaos…Opportunity<br />
    51. 51. RedPrairie At-a-Glance<br />Largest supply chain and retail optimization company in the world<br />Facilitating the flow of trillions of dollars of goods through the world’s most expansive supply chains<br />60,000 client sites/50 countries<br />Warehouse Management, Workforce, Inventory, Transportation, Logistics and e-Commerce solutions<br />
    52. 52. Thank You<br />Michael MayorasCEO, RedPrairie<br />

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