Supply Chain
Update                                                                                                       ...
orientation                                                                 Mark adkins
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keMllen lee
                           Kemllen
                                                   industries. For the past...
Executive Advisory Board
                                                              The Grainger Center                ...
Executive                                                                                                                 ...
>       A
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Supply Chain
Supply Chain
Supply Chain
Supply Chain
Supply Chain
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Supply Chain

  1. 1. Supply Chain Update Grainger Center for Supply Chain Management Fall 2009 SUCCESS in International Case Competition A team of Grainger Center MBA students brought home a second-place trophy and a $2,000 prize in this year’s Sam M. Walton College of Business International Graduate Logistics Case Competition held at the University of Arkansas. The Wisconsin team placed second in the 11-team competition (and first among U.S. teams), which included some tough competition from Penn State, Michigan State, the University of Arkansas, Brigham Young University, and the University of Minnesota, among others. The prestigious event brings together graduate students from the world’s top supply chain management and logistics programs and includes tremendous networking opportunities. Teams analyzed a case study about Braiform, a company that partners with retailers and garment manufacturers to provide retail garment hanger solutions. The team recommended ways to sustainably support growth of the company’s hanger reuse program and presented at the Sam’s The team, pictured here: Jennie Meresak, Chris Gajdostik, Mark Adkins, Club corporate headquarters in Bentonville, Arkansas, to a Ajay Balasubramaniam, Pete Lukszys, Amber Sleichter, and Samy Affo. panel of executives from Procter & Gamble, Wal-Mart, General The Grainger Center’s director of applied projects and senior lecturer in marketing, Pete Lukszys, was key in coordinating Wisconsin’s participation and Mills, Unilever, FedEx Freight, Pfizer Consumer Healthcare, J.B accompanying the team as faculty representative. Hunt Transport, and many more. The Wisconsin team’s solution involved relocating one of Braiform’s U.S. distribution centers INSIDE to provide transportation savings and leverage intermodal transportation. Darmstadt University of Technology (Germany) 2 Meet the Class of 2011 won the competition, and third place went to a team from 5 Supply Chain Management Students Elected to Key Chalmers University of Technology (Göteborg, Sweden). Leadership Positions 6 The Grainger Center Difference 7 Two New Executive Advisory Board Members 8 2009 Executive Advisory Board Meeting 9 Supply Chain Frontiers: Nontraditional Applications of Supply Chain Principles 10 Management of Risk and Uncertainty in Global Supply Chains 11 Reports from the Field: Summer Internships 2009 13 Kelly Ketchum Memorial Alumni Scholarship and Fundraising Update 15 Superior Customer Service through Supply Chain Management at Grainger-Mexico 16 Fall Site Visit: Kraft Foods/Oscar Mayer 17 Supply Chain Management Undergraduate Specialization 18 Grainger Center Alumni...Where Are They Now? Scott Pollyea, MBA 2004 20 2009 Placement Report
  2. 2. orientation Mark adkins After graduating graduation, Kwame joined Chemdesign Corporation as maintenance manager delays in workloads as a way to reduce work in process and to adjust routing duties with his direct reports and the branch as a whole. during Operation Iraqi Freedom. Phil earned his bachelor’s degree from the Rutgers 2009 from the University of Memphis with a in charge of maintenance operations for four production plants and the associated auxiliary buildings. He managed standard times to real times. She developed and established a productivity metric that allows management to measure Tim graduated from the University of Wisconsin-Madison in 2003 with a degree Business School and, upon graduation, went on to establish an investment and insurance brokerage franchise in the Seattle area, bachelor’s degree the maintenance personnel, maintenance plant performance. After two years in in consumer science with an emphasis in proudly serving a client base of career military In addition to the usual debriefing, in logistics and service contracts, and equipment spare parts, manufacturing, Maria was a price and consumer affairs in business. Shortly after officers and senior enlisted personnel. Phil’s Grainger Center students enjoyed a supply chain and he planned scheduled and controlled quote analyst in the operations district of graduating, he moved to England and spent primary area of interest is in sustainable panel discussion with alumni about management, maintenance jobs. Kwame also worked on Baker Oil Tools-Baker Hughes. In this role, seven months working in London and supply chain management. Phil is a nationally what to expect during their two years Mark worked at cross-functional teams, including quality she was responsible for controlling the initial traveling as much as possible around Europe. competitive sailor and volunteers at a local in the program. The panel gave advice on Cleveland Golf control, process hazard assessment, and and final stages of all tenders, proposals, and Outside of class, Tim enjoys mountain biking, community-supported organic farm. adjusting to graduate school, managing as a buyer/ safety teams. In his next role as principal quotations through SAP, and she updated golf, and reading. the workload, staying organized, and planner and as a master scheduler. He was project manager, Kwame negotiated, marketing statistics of all companies/ sTeve harris landing internships. responsible for the scheduling of golf club ordered, and tracked capital equipment customers to ensure responsiveness and Phil FriTz Steve joins the assembly and ensuring optimal inventory while working closely with the purchasing assure market share of product lines. Phil has five Center with First- and second-year supply chain levels. After his time at Cleveland Golf, he department; managed the $2 million years of work 13 years of management MBAs met officially for the took a position at APM Terminals in Los maintenance and engineering operations Maria earned a bachelor’s degree in experience in professional first time on a cruise of Lake Mendota. Angeles, where he was in operations budget with reporting responsibilities to industrial engineering from the University outside sales and experience in management, supervising the loading and upper management; worked in several of Zulia, Venezuela, in 2005. She is global logistics the technology, And, as always, students, faculty, and unloading of container vessels. He was cross-functional teams; served as engineering particularly interested in inventory management. financial services, staff met at the home of Executive Director responsible for supervising longshore liaison between Chemdesign and its clients; management and distribution. While working and government Jack Nevin for an evening of great food labor, interacting with vessel crew, and and negotiated and managed several service in the New York sectors. He and conversation. coordinating with terminal management to contracts and jobs. In December 2006, TiM BreiTaG City office of started his career ensure the operation ran smoothly. Most Kwame was selected to work with the upper Tim joins the CH Robinson in international recently, Mark worked for World Class management team at Chemdesign that Grainger Center Worldwide, trade with the U.S. Department of Logistics Consulting as a project manager, developed its performance matrices and after working for Phil was responsible for coordinating Commerce, then shifted into the private where he was responsible for projects carved a new culture for the company. five years for international multimodal transportation sector and spent seven years as an industry addressing various supply chain issues for Kwame is interested in global strategic Progressive and logistics services to global clients. He analyst at IDC, a leading technology market of 2011 Meet the Class different companies. Mark hopes to gain a sourcing and contracts negotiations and Insurance in San marketed the company to senior-level decision research firm, where he managed the firm’s complete understanding of supply chain optimization of supply chain operations. Jose, California. makers who managed inbound and outbound Internet telecommunications research area management and apply his knowledge in He held a variety enterprisewide supply chains. Phil generated and built a new research program from industry to become a leader in supply Maria of roles, starting new revenue by qualifying leads, making initial scratch to become the company’s most chain management. GaBriela as a claims contact, analyzing demand/supply side logistics profitable telecom program within three alBornoz representative functions, developing and presenting years. In 2005, Steve joined Discover Card, kwaMe As a and leaving the company as a managed proposals, assembling customer-specific where he was hired to build and manage a adu-Bonnah manufacturing repair representative. He was responsible operations teams, and overseeing project research and analysis unit and helped teams Kwame has engineering for monitoring vehicle repairs completed integration while managing all client-facing incorporate better information into seven years of intern at a Baker through Progressive’s Direct Repair shops relationships. Phil also worked to establish the decision-making process concerning cross-cultural Oil Tools-Baker and other repair facilities in the East Bay. a domestic outside sales team at the new product launches, business process industry Hughes This entailed monitoring vendor relations, Philadelphia CH Robinson office, focusing streamlining, and technology deployments. experience with manufacturing negotiating repairs, completing quality his efforts on Fortune 500 business prospects. progressive facility in assurance inspections of repair quality, His most recent project involved managing Steve earned a bachelor’s degree > management Maracaibo, confirming adherence to company and the massive rollout of a best-selling Harry in economics and international relations roles. After Venezuela, Maria was responsible for industry standards by vendor shops, and Potter book. from the University of Wisconsin-Madison graduating with analyzing manufacturing variances to improve owning the results of customer experience and a master’s degree in international relations > a mechanical engineering degree from the Kwame Nk- manufacturing processes. As a production intern, she was responsible for designing and and satisfaction surveys. Tim was selected to be a member of Progressive’s Accelerated Prior to his work with CH Robinson, Phil pursued military officer training at the with a concentration in international business diplomacy from Georgetown University. Steve > rumah University of science and technology in Ghana, Kwame worked for two and a half years in Ghana before coming to the United States to earn a master’s degree in industrial implementing a methodology that allowed shop floor personnel to post production times to SAP at every stage of the manufacturing process to improve planning and production Leadership program, an 18-month rotational program to identify and train future management, which allowed him to take on several leadership roles within the Maritime College in New York City, where he completed his master’s degree in international transportation management. He has also sailed commercially with Maersk Lines lived and worked in Germany and enjoys international travel. engineering and operations research at the coordination. She identified root causes of organization and perform management Limited and the Military Sealift Command University of Massachusetts, Amherst. After continued on page 4 2 3
  3. 3. keMllen lee Kemllen industries. For the past five years, Jennie held the position of director of marketing and UW-Madison. This passion for athletics and competition remains a large part of his life, Supply Chain Students graduated cum laude operations, where she was responsible for and Kyle still enjoys many sports, including Elected to Key from Hunter College the marketing and operations functions of football, golf, and boxing. with a BS degree in a start-up multimedia children’s brand, Leadership Positions physical education with an emphasis on including product development, sales and channel management, sourcing, and yuxinG (hesTer) wanG Hester has three in the Wisconsin MBA health and nutrition. production. She led development of two years of experience Upon graduation, she in international Continuing the Grainger Center’s award-winning products from concept joined the Brearley business and tradition of leadership in the Wisconsin Bruce Fritz inception through market launch and School faculty, where manufacturing, MBA, three students were elected by their managed the profitable migration of she honed her working as peers to hold key leadership positions in manufacturing from Michigan to China. the program. team-building and project management skills by developing initiatives that resulted in Jennie studied finance and biology at Blue Ridge Home Fashions’ Connection, Leadership, Innovation, and Community: improved working conditions for the staff Washington University in Saint Louis and chief order Amber Sleichter was elected as the Technology Communications Chair of four Values That Define the Wisconsin MBA members of the school and greater graduated with a BSBA in 2002. She would coordinator for community service opportunities for the North American the Graduate Business Association (GBA) like to put her skills and background in The Wisconsin MBA is designed to put In addition to its MBA program, the students. Throughout her 11-year tenure, accounts and the for 2009. In this role, Amber manages all science to use in the biotech, medical professionals out in front in their chosen Center also offers an undergraduate Kemllen’s passion for health and primary contact person for China factories. external communication from the GBA device, or pharmaceutical industries, fields. It is composed of outstanding specialization and assists in the efforts of community continued to grow, and, in 2007, Hester was responsible for sourcing and the MBA student organizations to the preferably in a global capacity. She lived programs in highly focused career faculty research in the field. she began to work with Hawthorne Valley packaging materials, coordinating new faculty, staff, and student body. She also acts and worked in Edinburgh and has traveled specializations in key areas such as Farms, where she helped generate new orders, and monitoring production and as the Web master for the Grainger Squire, widely. Outside of work and school, Jennie supply chain management. The program The Center was established in August business and increase revenue by developing a shipping status. She ensured smooth a weekly Internet publication that has enjoys traveling, playing tennis, riding her is about knowledge creation and 1991, with a generous gift from The successful marketing strategy that targeted the deliveries of more than $80 million by become essential to the cohesion of the bike, and cheering on the St. Louis Cardinals. providing transforming educational Grainger Foundation of Lake Forest, Hispanic community. Later that year, during diligent communication with three factories student community. experiences. It offers real focus and real Illinois. The gift was made to recognize her teaching sabbatical, Kemllen was offered kyle nakaTsuJi to mitigate any problems related to order success to students. the increasing importance of supply a brand management and food production manufacturing. As the liaison between the Kemllen Lee was elected as the President Kyle joins the chain management and the industry’s internship with Revolution Foods in northern Los Angeles and China facilities, Hester of the Graduate Business Association for Center after The Grainger Center for Supply Chain growing need for leaders with advanced California, where she promoted the company’s successfully handled various foreign 2010. In this role, Kemllen oversees the completing his Management at the Wisconsin School education in the area. The contribution new branded product line to store marketing customer visits and third-party factory audits activities of the GBA, supports the MBA first year in the of Business is one of the few endowed, by The Grainger Foundation allows the strategists and team leaders of Whole Foods’ and evaluations and helped set up supply student organizations, and maintains regular University university-based centers specializing Wisconsin School of Business to fulfill northern California region. Through these chain operation systems such as a product communication with the administration of Wisconsin Law in supply chain management in the a significant need in graduate business experiences, Kemllen became interested in labeling system and an order placing and of the Wisconsin School of Business in an School as a part United States. Its unique curriculum is education. how the supply chain and product tracking system, and she participated in a effort to continuously improve the unity of the JD/MBA cross-functional and takes an integrated management can improve a community’s warehouse space allocation project. among the student body, faculty, staff, program. In the process view of supply chains, During the summer of 1992, the Grainger access to healthier products. Kemllen is and administration. Law School, Kyle including marketing, sourcing, logistics, Center for Distribution Management looking forward to leveraging her experience was exposed to the Hester earned a bachelor’s degree in business operations, and customer service. It is became operational. The first class of in teamwork and education with the skills English from the Shanghai Institute of Foreign Jennie Meresak was elected the MBA foundations of the legal system, including a personalized and industry-focused students graduated from the program in she acquires from the Grainger Center to Trade, a well-known institute in China that Class of 2011 student representative on contract law, property law, and trial practice, program supported by companies the spring of 1994. In July 1999, it was lead supply chain projects in the food and specializes in international business. Hester the Master’s Committee for 2009-2011. and through these studies became interested known for supply chain excellence. renamed the Grainger Center for Supply health industry. earned a Best Student Scholarship in every The Master’s Committee is comprised of in the interrelation between law and Students connect with and learn from Chain Management. Since its genesis, academic year, developed a great interest in faculty, staff, and students and helps make business. The quest to understand the real-world supply chain leaders and are the Center has graduated 133 students Jennie Meresak import and export practice, and laid a solid important decisions regarding program dynamics of this complicated relationship, part of a strong, close-knit community. who have gone on to become business Jennie has seven foundation for her subsequent engagement in curriculum. In this role, Jennie will be able as well as the spectrum of business leaders across the industry, in firms large years of hands-on international business. to share the ideas and opinions of her class management, was what led Kyle to the and small. experience in on academic matters related to the MBA Grainger Center. marketing, program such as curriculum, operations, product admissions, student services, placement Prior to law school, Kyle received a BS development, and and assessment. degree in political science from the sales management University of Wisconsin-Oshkosh. As in the consumer an undergraduate, he was a captain of products and the university’s football and track teams technology and also played football for a year at 4 5
  4. 4. Executive Advisory Board The Grainger Center The Executive Advisory Board is comprised of DIffErEnCE senior executives at leading firms that are renowned The Grainger Center is pleased to announce for supply chain management excellence. Board the addition of Eric Smith and Kevin o’Marah members provide strategic and curricular guidance, to the Executive Advisory Board. Bruce Fritz participate in applied learning programs, and provide placement opportunities for students. Kevin O’Marah is chief strategy officer for AMR Research, a firm that provides The Center offers a unique promise of Electives may be chosen from multiple Close Community subscription advisory services and peer career and leadership development for: disciplines, including finance, marketing, Students experience the best of two worlds: networking opportunities to supply chain, management, operations, engineering, the resources of a large, world-class university Karl Braitberg Jim Ryan sustainability, and IT executives in the » individuals who are already working in sustainability, and entreneurship. and hands-on, personalized attention made Vice President, Chairman, President, consumer products, life sciences, supply chain management and want the possible by the in-depth resources offered Demand Management, and Chief Executive Officer manufacturing, and retail sectors. It is the best training and connections possible in The Center also offers an extensive applied by the Center. Each student receives Planning & Customer Value W.W. Grainger, Inc. world’s leading independent research firm order to lead learning program. personalized career and academic advising. Cisco Systems, Inc. focused on the global supply chain and its Kevin O'Marah supporting technologies. Kevin has led AMR’s Students are connected—directly and » individuals who want to manage the Executive speaker series: Top business personally—with an extensive network Jim Shuman global supply chain research since 2000, publishing seminal work whole business (not just one piece such leaders visit campus regularly to share their of industry executives, alumni, corporate Senior Vice President, on sustainability, product innovation, and the AMR Research Supply as marketing or logistics) real-world experience. partners, and faculty. Students receive John Kenny Materials Management Chain Top 25. Prior to joining AMR Research, Kevin worked on personalized guidance from this network President Genzyme Corporation supply chain projects in a variety of industries, including » individuals looking for a career path where Global experience: MBA students have throughout their time in the Wisconsin FreeFlow telecommunications, semiconductors, and chemicals. As a vice they can leverage both their analytical opportunities to travel abroad to meet with MBA program. president at Oracle Corporation, he focused on supply chain and capabilities and their interest companies and learn about their global product data management strategy. He was previously a strategy in relationships and systems operations. In January 2009, 14 students With an entering class each year of Brian R. Smith consultant in London, Washington, DC, and Warsaw, Poland. traveled to Brazil. between 10 and 20 students, supply chain Steve Loehr Director, Logistics and A graduate of Boston College, Oxford University, and Stanford This promise is fulfilled through management MBA students form close ties Vice President, Client Enablement Indirect Procurement Business School, Kevin speaks at industry events and has been delivering results in four key Site visits: Students learn about supply chain to each other and to the faculty and alumni IBM Global Operations, Harley-Davidson Motor featured in business publications including the Financial Times, areas: an integrated learning practices firsthand by visiting various U.S. dedicated to the supply chain management Integrated Supply Chain Company Fortune, BusinessWeek, the Wall Street Journal, CNBC Squawk Box, environment, industry partnerships, locations. Center students toured the facilities program. The Center offers generous financial and Bloomberg. personalized attention in a close of Johnson Controls in Milwaukee last spring aid packages to qualified students, including community, and 100% placement. and Kraft Foods/Oscar Mayer in Madison this fellowships, assistantships, and scholarships. Kevin O’Marah Eric Smith fall (see page 16.) Chief Strategy Officer Vice President, Eric Smith is a 1998 alumnus of the Grainger Integrated Learning Environment 100% Placement AMR Research Supply Chain Center and is vice president of supply chain The curriculum is cross-functional, AMR Research Briefings: Senior executive Supply chain management talent is in high Emerson Electric for the InSinkErator Division of Emerson applied, and collaborative, allowing analysts from AMR Research draw on their demand, as the Center’s record of 100% Corporation, Electric, a worldwide leader in power students to learn about supply chain deep industry experience to share success placement for summer internships and InSinkErator Division conversion and wireless technology for the management in an integrated business stories and challenges in presentations about full-time employment reflects. (See placement Thomas F. Pyle, Jr. industrial, residential, health care, and IT framework from renowned faculty the latest market findings and analysis on report on back cover) Our graduates achieve Chairman markets. Eric has responsibility for the with expertise in supply chain supply chain management issues, trends, quickly and notably. Average starting salaries The Pyle Group organization’s global procurement, logistics, management and other crucial and developments. AMR Research is the are consistently the highest among peer Gray Williams order fulfillment, materials planning, and lean schools, ranging from $80,000 to $110,000. Vice President, Eric Smith supply chain activities. His responsibilities business disciplines. #1 advisory firm focused on the intersection of business processes with supply chain A few facts to consider about the value of the Doug Raftery Worldwide Supply Chain encompass seven worldwide sites and managing a staff of more Core supply chain courses include: management and enterprise technologies. program: Center students are funded for at Former Vice President, Logitech than 80 individuals. Prior to joining Emerson in 2008, he served as • Strategic Global Sourcing least one year of their MBA experience, and Customer Business Development director of supply chain operations for Placon Corporation. He has • Logistics Management Industry Partnerships they typically double their pre-MBA salary Procter & Gamble over 20 years of experience in the consumer products and packaging • Operations Research The Center has deep ties to industry. Its upon graduation. industries, holding various engineering and management positions at • Marketing Channels extensive network of corporate partners Carolyn A. Woznicki Rayovac, Ingersoll Rand, Uniek Inc., and Placon. Home Services • Enterprise Systems and Supply Chain provides real-world perspective that Stu Reed Vice President, Global Management enhances the curriculum and applied Senior Vice President and Procurement Eric holds BS and MBA degrees from the University of • Seminar in Supply Chain Management learning program, and provides President, Home Services Johnson Controls, Inc. Wisconsin–Madison. He is active in numerous professional invaluable career guidance to students. Sears Holdings Corporation organizations and serves as a board member for both InSinkErator and the Racine Theater Guild. Eric and his wife reside in Madison with their two children. 6 7
  5. 5. Executive Supply Chain frontiers: Applications of Supply Chain Principles to nontraditional Processes Advisory Board Meeting packaging, reduced waste in production, by Caryl Knutsen tend to not understand the meaning of intersection where products and intellectual and lower power consumption. supply chain management and spend very property meet, where information and an » Head count reductions—reflecting On the day after the Executive Advisory Board little on technology to support supply intellectual property stream are embedded in general reductions in staffing, supply meeting, several board members and alumni chain management processes. Patient a physical product (think Nike and the Walt chain personnel declined by up to 40 joined Center students, faculty, and staff for a safety always trumps cost in driving Disney Company). percent in some firms. presentation by Kevin O'Marah, chief strategy technology investments, so hospitals officer of AMR Research, and Steve Loehr, need to incorporate both these factors Continuing with the theme of nontraditional Several firms appeared to be carefully vice president of client enablement for IBM when designing their technology initiatives. supply chains, Steve discussed IBM’s balancing competing priorities. For instance, Global Operations’ Integrated Supply Chain To provide high-quality patient care at transformation from a hardware company while reducing costs almost across the Management. They led a discussion of what optimal economic cost, the health care to an information and technology service board to conserve cash, most board member it means to be a globally integrated enterprise industry needs to link strategy to value in the provider. Today, the company is positioned to companies were increasing their focus on and what that means to the supply chain health care value chain through bidirectional help clients transform their businesses in the customer needs to improve customer service. function. To illustrate the wide reach of supply visibility, enabling technologies, building midst of rapid change; apply supply chain Many of the executives also stated that their chain management and its change from a sustainable collaborative relationships, expertise to other parts of its own business; companies were positioning themselves functional discipline to a business discipline, business process innovation, and alignment and lead governments and businesses to to take advantage quickly of improved Kevin delved into nontraditional applications in terms of both metrics and a shared vision imagine and build a smarter planet. One ex- economic conditions by relocating of supply chain concepts in the realms of and goals. ample of how IBM is applying and extending distribution centers and logistics networks. health care, entertainment and media, supply chain principles to transform business All of the panelists seemed to agree that most and sustainability. In contrast to the low visibility and is its Workforce Management Initiative (WMI), The Grainger Center’s annual Executive of the changes implemented over the course not-so-strategic use of information that which looks at the entire labor pool at IBM » Supplier risk of the past year were permanent. Although Steve provided some background and characterize the health care industry are the as a resource and applies supply chain design Advisory Board meeting was held on • Most panelists mentioned that financial October 15, 2009. Second-year supply they anticipated a slow improvement in examples of how IBM has extended supply extremely strategic use of information and best practices to get the right person, at the strains in the supplier network triggered chain management MBA students made economic conditions, many of the firms chain principles to services and labor. Space high visibility of the media and entertainment right cost, in the right job, at the right time. stress testing for significant suppliers presentations to the board about their represented on the Executive Advisory constraints allow this article to touch on only industry. Kevin’s presentation continued with Providing central oversight of strategy, to determine their financial viability summer internship projects, providing a Board believed they would continue their a few key points of the information-packed some observations about this sector and the measurements, and investments, WMI • Tier-1 and tier-2 suppliers were unique and valuable opportunity to efforts at cash management, improved session. Kevin’s discussion of the health care supply chain management challenges therein. optimizes talent pools and allows global investigated for financial viability showcase their knowledge and achievements inventory management, and periodic review industry began by identifying a number of The total economic output of the media and visibility of the expertise across all • While no one injected cash into a to top supply chain management executives. of critical suppliers. issues that plague the industry. Over the last entertainment industry outpaced agriculture business units. It uses comprehensive critical supplier, a couple of firms The day also featured ample opportunities few decades, health care and life sciences decades ago and is likely to outpace professional profiles to provide precise accelerated payments to important for networking and socializing with board companies have built silos both tall and wide. manufacturing in the near future. The supply staffing and essentially facilitates a suppliers to help ensure their viability members and Center alumni and faculty. As a result, the value chain lacks visibility, chain in this industry is based on global talent exchange. IBM has quantified » Acceleration of contract renegotiations— processes are disconnected and suboptimized, consumer-driven information content, some real business results: increased client a few firms changed their renegotiation For many, the highlight of the meeting was a network operations strategy is absent, and and the economics are very different from satisfaction, faster and more effective bid time frames from yearly to more the panel convened during the afternoon trust and communication between providers traditional supply chains. The creation of response, avoidance of unnecessary hiring frequently (to monthly, in one case). session, during which board members and payers are rare. Without transparency the product—information—is a one-time, and use of subcontractors, and more than » Reduction in inventory—many panelists and collaboration, inefficiencies, waste, and virtually cost-free enterprise; consumption/use $1 billion in savings. Another nontraditional discussed the impact of the recession on stated that they reduced their inventory their supply chain operations. They shared excess cost will continue to run rampant in of the product is indefinite, and content application of supply chain management levels to reflect reduced demand and some of the tactical and strategic responses the value chain. Furthermore, analysts at is often freely shared among users. There principles was a project to solve a huge achieve cost savings. of the supply chains at their companies to the AMR Research have found that there is is so much content that providers and traffic problem in Stockholm, Sweden. » Cash conservation was the overriding great confusion about who the customer is distributors are losing control of the audience, The goal was to use technology to reduce unprecedented and unanticipated changes priority for most firms. Many stated that (patients? providers? doctors? pharmacies?). in economic conditions and demand over and it is nearly impossible to put a price congestion, improve public transport, and they paid suppliers less promptly in order Top issues confronting hospitals are financial the past year. They were also asked, “Do on the content and control it. Some of the alleviate environmental damage. The system to conserve capital. challenges such as profitability and growth, you think these changes are temporary or supply chain challenges regarding content improved both congestion and overall » Private label is growing as customers caring for the uninsured, and the rising cost and information include shelf life, quality of life in the city. Results included permanent?” Several themes emerged in the seek greater value. of supplies, compounded by a general discussion, including: componentization, interoperability, and a 25% decrease in traffic, a 60% boost for » Companies are investing in sustainability— unawareness of how dissatisfied many how to value the assets. Kevin concluded inner-city retailers, and a 40% drop in for environmental reasons and to reduce patients and doctors are. Hospitals with an interesting observation about the greenhouse gas emissions in the city. current costs through less bulky 8 9
  6. 6. > A ll supply chain management MBA defining a structure for the QA of distributors and retailers (sell-through) rather SUMMEr InTErnShIPS 2009 students found valuable internship function within the ERP framework and the than sales data that represents shipments into positions at leading companies in enterprise as a whole. Ajay presented his the channel (sell-in). Chris’s project involved incredibly diverse industries, ranging from findings to the senior leadership team and analyzing European sell-through data to assess biotech in Boston to high-tech in Silicon enjoyed the experience of being involved in a its usefulness for statistical forecasting and to Valley, with mining, beer, transportation, process improvement project. find the optimal tradeoff between forecast Keenan Yoho detail and forecast accuracy. In addition to medical devices, and more in between. What the projects all had in common were Mark Dyer analyzing the optimal levels of detail and Management of risk and Uncertainty strategic improvements in business processes. Genzyme Corporation Framingham, MA accuracy, Chris discovered a higher level of forecastability among certain channel partners, in Global Supply Chains Samy Affo countries, specific product categories, and Reports from the Field: Shure, Incorporated As an intern in products representing the top 80% of sales Niles, IL Genzyme’s global volume (using the 80/20 principle). By David Poytinger supply management As a supply planner intern organization, Mark Terry Goeldner Keenan D. Yoho, assistant professor at the Naval Postgraduate School in Monterey, on the operations team at worked on a variety American TV California, led the first of the Center’s applied learning sessions this fall. His presentation Shure, Samy worked on of projects, including the selection of an & Appliance on the management of risk and uncertainty in global supply chains highlighted some of two main process enterprise resource planning integration Waukesha, WI the major issues facing global supply chain managers today. Keenan took big-picture improvement projects for partner, a systematic sales and operations supply chain issues and made them accessible by using real-life case studies. One case new product introduction teams. His primary planning process review, the formulation Terry interned study in particular, which looked at some of the major problems facing the production of project consisted of standardizing supply chain of product allocation design plans, and the with the Logistics Boeing’s new 787 Dreamliner, helped students to understand the importance of managing tasks, milestones, and processes for new integration of acquired products into the and Distribution risk appropriately. product introduction. He developed metrics formal Genzyme business processes. Department of and detailed process documentation for During a major supply chain disruption that American TV & Appliance, a Wisconsin-based The story of the Dreamliner is commonly known. The plane that was supposed to each milestone, and he worked with supply included an unexpected and immediate loss mid-level retailer that sells furniture, TVs, revolutionize the airline industry with its 50% composite materials construction, fuel planners, SAP analysts, and engineers and of production capacity, Mark worked closely and appliances in five states throughout the efficiency, and innovative production processes has been plagued with constant delays that researched best business practices to complete with the business units to move existing Midwest. He analyzed American’s recycling are mostly attributed to breakdowns within Boeing’s supply chain. Looking carefully at some the project. The main benefits of his project inventories to markets where none existed and program, including the recycling of appliances, of the major hurdles Boeing had to overcome, Keenan pointed out areas where more efficient were increased visibility, consistency, and helped to implement drug allocation plans that bedding, electronics waste, and TVs. In risk management could have been used to proactively identify areas of concern within both measurability of supply chain tasks during would allow the maximum number of patients particular, Terry reviewed the initial the design and production processes. Supply shortages, components not produced to new product launch processes. to continue receiving uninterrupted treatment. implementation and performance of American’s specifications, and component defects were all problems that resulted from ineffective Due to the rapid pace of growth at Genzyme, new TV and E-waste recycling program. He management of the global supply chain. Ajay Balasubramaniam the global supply management organization collected and evaluated data on operational Genzyme Corporation determined that a new ERP system would be procedures and cost structure, identified and Using the Dreamliner case study as a base from which to work, Keenan explained how Framingham, MA necessary to continue to effectively satisfy verified partners, and exposed potential legal risk and uncertainty could have been more appropriately accounted for in the design and patient demand. Mark was part of the team risks for management to review. The recycling production processes. He highlighted some key questions facing not only Boeing, but also As an enterprise resource that assessed competing bids, determined effort will be used to help American develop global supply chains around the world: planning (ERP) program whether the potential systems could meet a new marketing platform featuring its “green” summer intern at one of Genzyme’s needs, and completed the initiatives while being cost neutral and » How should consideration of risk be incorporated into the product and process the world's leading statement of work that will guide the final addressing growing market need among its design decisions? biotechnology companies, implementation over the coming months. customers and its communities. » How should we consider risk and uncertainty in execution and performance? Ajay worked with multiple teams, including master data management, system architecture, Chris Gajdostik Gloria Guo Failure to account for such risks can have ramifications beyond simple delays in the interfacing, and compliance and validation. Logitech Logitech production. Competitors are able to capitalize on lost sales with competing products. The primary objective of his internship was Fremont, CA Fremont, CA Investor confidence begins to wane, and stock prices take hits. Suppliers struggle to keep to understand and analyze the ERP up with production as payments are delayed and, in worst cases, are unable to produce implementation process and suggest strategic Logitech’s Gloria worked on necessary components to complete production. approaches for process improvements. Ajay’s worldwide two projects related analysis concentrated on the feasibility of supply chain to forecasting and A key learning from the presentation was how to segment risk to differentiate critical having a quality assurance function for ERP department demand planning in components of any process from those that are only ancillary. Applying these skills to real enhancements by considering costs and has been working Logitech’s worldwide situations is easier said than done, but expert guidance, as shared by Keenan, make the benefits of having QA outsourced or performed to drive the statistical forecasting process with supply chain division. The first project was prospect of success more likely. in house. Other recommendations included sales data representing the outbound shipments driven by Logitech’s use of total point-of-sale 10 11

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