Supply Chain Blog

Gartner Top 25 Supply Chains: Did your FMCG company make the list?

Posted by Dave Jordan on Wed, Jun 11, 2014

The annual Supply Chain “Oscar’s” have been announced by Gartner for 2014. I list the top 10 here but to see the full list of top 25 global Supply Chains please click and surf here.

  1. Apple
  2. McDonald's
  3. Amazon.com
  4. Unilever
  5. Procter & Gamble
  6. Samsung Electronics
  7. Cisco Systems
  8. Intel
  9. Colgate-Palmolive
  10. The Coca-Cola Company

Many of the usual suspects are present as you would imagine but what is very interesting for me is seeing Unilever in the top group after being as low as 21st in 2010. Keep up the good work boys and girls; my pension depends on you.

supply_chain_top_performers_2014I doubt any SC professional will get over-excited about being in the top 25 but what about those names that are not present? Some will have opted not to take part and others may be in the midst of huge change and could not be contenders in the assessment period. Also, I guess some people do not want to be at the top of the pile either as the expense to get there and stay there may not be their priority for investment. However, if your major competitors are on the top 25 list and you are well off the pace then surely that must be a problem.

The top 10 has four multi-national FMCG giants so the process of getting stuff onto supermarket shelves is clearly being done very well by some companies. So if we assume the science behind the assessment is sound there are a large number of companies doing something wrong or at least not nearly as good as others.

Electronics and computing related companies are well represented and they of all people will be exploiting the technology they have invented to optimise availability and speed of supply. Amazon is another interesting company in that it now acts as a Supply Chain company rather than a books/CD/DVD supplier. Their product range is huge and they are successful by having a very slick Supply Chain. You can buy a new dress from all sorts of places but possibly only Amazon will get it to your door the very next day at a fraction of the cost of that charged by couriers for a similar service.

What about McDonald’s fast “food” restaurants? You may know I am not a fan of their offerings but you cannot knock them for their success. The consumer pull on their burgers and fries or mici here in Romania, is very powerful and as long as everything is available when you approach the counter you will buy and be wished a nice day. They do not always get it right though as I noted a few months ago.

Not so long ago Supply Chains were considered to be just an annoying cost on the books but no so now. Those companies that have invested in Supply Chain people, processes and performance are clearly reaping the benefits.

Image courtesy of Stuart Miles at freedigitalphotos.net

Tags: FMCG, Dave Jordan, Performance Improvement, Telecoms, Pharma, Supply Chain

Supply Chain Recognition: Enchange blog gets an Oscar – sort of!

Posted by Dave Jordan on Tue, Mar 11, 2014

Recognition.  Everyone needs to feel a bit of warmth and appreciation at some stage at home and work or life can be a bit of a drudge. Recognition of an achievement or responsibility can take various forms. At school, recognition as the class Milk Monitor was keenly sought after. (UK readers born after 1971 are thinking if a Milk Monitor was a computer screen launched before Apple Inc got their act together with the Mac.)

What a responsibility and also a position of peer power? As Milk Monitor you were able to ensure you got a milk carton from the bottom of the stack that was still cold rather than a warm one from the top of the pile.  Similarly, you were able to decide who received the expired carton saved from last week and hidden behind a radiator. Would I do that?

While the UK’s honours system is raft with cronyism and political gifting there are always some names fully deserving of an award and the opportunity to meet a member of the British Royal Family at Buckingham Palace. This could be the “Lollipop Man” who has helped children cross a busy street for 25 years or one of the many selfless charity workers who are dedicated to causes that the government should pay for anyway.

A footballer who has scored a hat-trick of goals in a thumping win and is then substituted to loud and warm applause surely deserves that moment in the spotlight. However, this should not apply to Wayne Rooney. A reported GBP300,000 per week for a maximum of 2 matches is outrageous. If we assume a 40 hour week – which is not the case – Wazza is picking up GBP7500 per hour and what’s more, he gets paid whether he plays or not, how badly he performs and even if he is suspended. They way he plays sometimes, makes me think he should be suspended from something!

Enchange Blog voted in top 50 resized 600Anyway, I digress. The theme of this blog is all about recognition and thanks to you, our readers and subscribers; we have had a bit of recognition ourselves. The Enchange blog has been voted one of the top 5O Supply Chain blogs in the world by SupplychainOpz.com – click on this link to see the full list.

I really do not mind if the Enchange blog was rated number 1 or 50 but the simple fact it has been recognised as a source of good Supply Chain stuff is great news. So a big thank you to all our readers, subscribers and referrers and we look forward to keeping you trained and entertained on all things Supply Chain.

I think it is time for a celebratory glass of something. No, not milk.

Image courtesy of pixtawan at freedigitalphotos.net

Tags: Brewing & Beverages, FMCG, Dave Jordan, Telecoms, Pharma, Supply Chain

FMCG Supply Chain IT : ERP and WMS – use it or lose it Mr CEO!

Posted by Dave Jordan on Wed, Feb 19, 2014

In a development similar to buying your first colour TV (yes my dear daughter, we watched black & white telly) or the first microwave cooker, I have finally bought a Smartphone. This is a significant step as my previous sets have all been robust, no nonsense sensible equipment which could probably survive a nuclear attack. The new telephone has a huge screen and the sales lady in the Vodafone shop told me it had the latest hemorrhoid operating system and piles of apps, or something like that anyway.

CEO Supply Chain IT resized 600Now I can access the internet, use Skype, check my email, see where I am on a map, store files in the cloud and even call people. Tapping numbers on a screen rather than depressing buttons is very new to me and this is providing an unexpected hazard. After ending a call I find that I inadvertently activate call-back dialing when I place the telephone in my pocket. While I am blissfully unaware other people and children in particular can hear my wife shouting “Dave, Dave you’ve done it again, stop calling me back”. The innocent and confused children ask “Mummy, why is there a girly voice coming from that man’s trousers?”

While I have so much extra functionality at my fingertips I doubt I will progress much past looking at the football scores on the internet. To be honest this is likely to be the situation until our daughter returns from university and shows me what to do.

All that technology, functionality and connectivity simply wasted. No, not me and the new Smartphone but you Mr. CEO; you and your Supply Chain IT purchases. In global companies there is usually a corporate IT buying strategy that all units have to adopt without argument and without the ability to “localise” the offering. Smaller companies can have more flexibility in their choice of IT supplier and they could and should certainly receive a bespoke solution tailored to their specific needs.

Yet last week I was surprised to see FMCG company XYZ had purchased various SAP modules including APO but had failed to install the software. Similarly, a new WMS was sitting in a virtual shiny box on the bookshelf. When you think about it, that is quite an investment which has not returned even 0.01% of the purchase price.  Why would you do this? Your employees are struggling along with an ERP that Noah rejected for its lack of numeracy power and Excel files the size of a small village. And guess what? Your in-market performance is continuing to slide down into an abyss from where even Bear Grylls could not escape.

Take the cellophane off the boxes and get your software installed before both your career and the IT become obsolete. Call me if you need any help.

By the way, I have purchased the same Smartphone for my wife. Be afraid children, be very afraid!

Image courtesy of anankkml at freedigitalphotos.net freedigitalphotos.net

 


 

Tags: Dave Jordan, CEO, Telecoms, WMS, ERP/SAP

RTM New Year Sales Tactics for Electronics & Telecoms Producers

Posted by Dave Jordan on Thu, Dec 05, 2013

The year-end Christmas rush is about to gear up once more. Despite the ropey economic conditions people will still find ways to spend as much money as possible – that they don’t have - over the holiday build up and the inevitable “everything must go” post Christmas period.

Those in the detergents and personal products businesses probably do not see much of a peak as people do not really wash themselves or their clothes more often but there will still be expensively assembled gift packs on offer. Nevertheless, FMCG, Brewing and Pharmaceutical Supply Chains will undoubtedly be running under pressure and overtime to ensure the optimum volume/value is delivered. This is more concentration in demand than a real stand alone peak event.

Food and drink producers experience a real peak as consumption undoubtedly rises with all the celebration and entertaining events but how much of what is bought is actually consumed? Excess fresh food is destined for the waste bin and immediately off the demand radar but non-perishables can hang around for weeks and months belatedly popping up and upsetting carefully crafted demand algorithms.

Electronics and telecoms producers certainly experience a real peak as the latest gadgets and must-haves are wrapped and gifted to friends and relatives. Of course, everyone knows that all these gadgets will soon be superceded by better/cheaper/faster models but that is a fact of electronics retailing these days.

If the purchasing public actually organised a co-ordinated effort then I see a major risk for the electronics producers and what a shopper coup this would be! Despite knowing that their new state of the art gizmo will be considerably cheaper in the post Christmas sales a vast majority of people still buy in advance for giving on the big day itself. I understand the behaviour but so too do the electronics producers and their retailer cohorts who make a profit at whatever the selling price.

New Years SalesIf everybody and I mean everybody - no dissenters - refused to buy electronic items in the build up to Christmas how would producers and retailers react? Would inflated prices be maintained and taken out of New Year sales campaigns or would they enter into a game of bluff with consumers?  Who would crack first in that instance? Would consumers give up and decide they need that must-have telephone or tablet at any price? Would producers and retailers realise that they need to shift this stock as it will upset the innovation flow out of NPD?

This stock has to move out. Yes, the stock could be downgraded and sold in different channels or in different countries but in that case a large quantity of expected revenue is lost. Year end targets that have been promised and re-promised will not have been achieved and working capital that is losing allure by the day will be on the books into the new financial year. Will sales prices eventually be advertised even if the offers are not as low as expected?

I know such a co-ordinated consumer campaign is unlikely to get off the ground as the desire to give in a timely fashion outweighs the potential savings even though there can be several hundred Euros involved.

Those countries and cultures with Christmas celebrations taking place in early January really do have an advantage, don’t they?

Tags: Route to Market, Christmas, Dave Jordan, Performance Improvement, Telecoms, Forecasting & Demand Planning, Sales

Another telecoms customer service calamity results in lost customer

Posted by Dave Jordan on Tue, Jul 23, 2013

Another telecommunications related tale rounds off my current trilogy of customer service mishaps. I really do hope this is the last one I experience as I have been on a run of really bad luck lately. However, I suspect a long, hot and sunny UK summer without rain is more likely. Oh hold on a mnute, the UK summer has appeared!

Bucharest visitors will all have noted the ugly reels of communications cables hanging on every street light and telegraph pole. Romania is a very switched on and well connected country in terms of internet speed and availability but I live in the wireless internet enclave called Pipera. Specifically, at the end of the Aurel Vlaicu airport runway in an area ruled by the widely reported wild dogs and awash with implant recipients, i.e. Romania’s very own silicone valley.

Telecoms Customer ServiceFast broadband internet connection cables can be seen from my office but they are not coming any closer than 100m away very soon. This is why I rely on wireless broadband - if that is not a contradiction in terms as it is relatively slow. Returning from an S&OP project in Jeddah, KSA I found I could not access the net at any speed. Had I paid the last invoice? Yes, the direct debit had gone out on time as usual so that was not the cause.

Only one course of action left was to call company X customer service department. After getting through the robotic multiple choices with a string of punched-in binary code I finally reached someone who breathed and spoke excellent English. So far so good; this should be sorted out in no time at all.

CS Agent: “The service you had is no longer available

DJ: “ But my contract runs until October. Why is it no longer available?”

CS Agent: “The government withdrew the licence.”

DJ: “Ok, I guess there is nothing we can do about that but as I use the connection for my business it would have been good to know in advance so I could make alternative arrangements.”

CS Agent: “But we did tell you…..”

With walking into a room and not knowing why becoming more frequent in my life, I scanned my human memory for a letter, an email or even a phone call but no, I had no recollection of such notification.

CS Agent: “We sent you an SMS to the internet modem 10 days ago.”

DJ; “You mean you sent a message to the modem that I have not used for 2 weeks and now does not work?”

CS Agent: “Yes!”

There was no point in continuing the discussion. Why was there no effort to contact me to at least look at alternative possibilities? This company simply lost the government licence and that was that as far as they were concerned; customer service was not in the equation.

I decided to switch providers and did so rapidly and it delighted me in cancelling the contract for my second internet device from the same service-poor company.

SC Agent: “Oh no, you cannot do that as your contract is live until October and you have to honour this.”

DJ: “Do unto others as they do unto you.”

Image courtesy of Glberto107 at freedigitalphotos.net

Tags: Customer service, Dave Jordan, Telecoms, Supply Chain

Telecoms Customer Service reputation ruined in seconds

Posted by Dave Jordan on Wed, Jul 17, 2013

I recently wrote about how an airline dented its reputation with an overly fussy interpretation of on board baggage storage rules. In my poor customer service trilogy I now turn my attention to a well known global telecoms company. I will keep the name to myself on this occasion as the outcome is not yet finalised.

Telecoms companies change their deals so frequently it is difficult to keep track and really understand what each deal offers for you personally. So, when company X called me and suggested I pop into the shop to review my contract package I thought why not. With the heiress being in UK our telecoms costs had risen to a new level as we dealt with lost passports, lost keys and the heiress simply being lost.

Telecoms Customer Service failure resized 600On discussion with said shop it was very clear that our current contract was not ideal for our new long distance communication situation. I was offered a solution that would indeed save money but as my current contract was not adjustable for another 4 months I would have to take a new contract with a new number and lo and behold there was a special offer on just at that moment.

I accepted with the knowledge that I would return in 4 months and make a new lower cost deal for the number I had used for 10 years. What’s the problem with that then?

Exactly 1 month and 1 day after signing the new deal – yes, outside of the cooling off period – a cheery voice called and asked if I would like a new deal on my existing telephone number. Interesting, thought I so I listened to the pitch, i.e. “we have noticed you call UK a lot and we can give you a cheaper option”. Yes, you have guessed correctly, suddenly at their prerogative they offered me exactly the same deal I had taken one month previously on the new number.

Why didn’t the assistant at the shop tell me this? All my numbers are visible and call histories for at least the last 6 months are available so what stopped the assistant giving me a really good deal that would make me walk out with a spring in my step and a feel-good smile? Sales commission!

The deal offered in the shop brought the sales assistant some financial benefit through pushing the promotion. Yes, the solution offered did indeed save money but the desire to sell a new number overpowered his will to provide the best solution for the customer, i.e. the same new deal on the existing telephone number.

An example of a salesman doing what is right for him and not what is right for the customer or the company.  Unforgivable, in any sector at any time.

Image courtesy of Stuart Miles at freedigitalphotos.net

Tags: Customer service, Dave Jordan, Telecoms, Supply Chain, Sales

Learn the 10 Steps to Make S&OP Work in Mobile Telecoms

Posted by Michael Thompson on Fri, Jul 22, 2011

 

In my blog post Reasons for establishing S&OP in Mobile Telecoms, I recounted a success story of S&OP in a mobile telecoms company.  I then went on to discuss the principles of S&OP design in the post Learn the 8 Basic Principles of S&OP in Mobile Telecoms.

My discussions with Colin, our Mobile Telecoms Executive, continued.  Colin is a Senior Executive with a mobile telecommunications company with operations in several markets in Africa.

We started talking about the nuts & bolts of how S&OP could actually work in a mobile telecoms company. 

We designed the outline of an S&OP process including with a regional supply chain and operational structure in mind.  Diagrammatically the design we came up with was as follows:

S&OP Process for  Mobile Telecom

The process commenced with input from the regions within the country – we called this regional S&OP.  The demand review considered inputs from local marketing activity and the regions; the forecast also considered trade data. 

The supply review considered two main series of activities. The supply plan and product purchase plan considered the provision for mobile handsets and other items sold in the local market (NB some markets also used scratch cards that sold airtime). A network plan and equipment purchase plan looked at the supply needs to maintain the network.

Following a financial evaluation of the demand and supply plans, a national pre-S&OP consensus meeting was undertaken. The process concluded with the monthly S&OP meeting to agree the plans.  Following this demand execution and supply execution processes put the plans into action.

As it happened the design was similar to the one that Enchange has used in the past with mobile telecoms companies in African markets.

Let’s see if it does the trick for Colin.

Tags: Telecoms, Michael Thompson, S&OP, Forecasting & Demand Planning, Doing Business in Africa

Learn the 8 Basic Principles of S&OP in Mobile Telecoms

Posted by Michael Thompson on Fri, Jul 15, 2011

In an earlier blog Reasons for establishing S&OP in Mobile Telecoms, I recounted a success story of S&OP in a mobile telecoms company. Reasons for establishing S&OP in Mobile Telecoms.

I continued my dialogue with the Senior Telecoms Executive – let’s call him Colin.  His company operates in several markets in Africa.

S&OP in Mobile TelecomThe challenge we set ourselves was to design an S&OP process for a mobile telecoms company.

In the first instance we explored some of the basic features of S&OP. 

Mike: Do you remember how we started in your last organisation?  (Colin used to work for an FMCG multinational in Africa.)

Colin: I seem to remember we started with some principles.

Mike: Exactly.

Colin: So what are the basic principles of S&OP in mobile telecoms.

Mike: To a great extent the same basic principles apply in mobile telecoms than they do in any other type of business.

Colin: How can that be? Mobile telecoms is an entirely different business.

Mike: You are confusing process design with basic principles.  While the design of S&OP in a mobile telecoms business is different, the basic principles still apply.

We then spent some time discussing the basic principles of S&P in any business and tested these assumptions in mobile telecoms.

Here is the list of 8 Basic Principles of S&OP in Mobile Telecoms:

  1. S&OP is a collaborative cross functional process that engages all functions to produce an integrated set of plans that all are committed to support. 

  2. The plans cover a sufficient time horizon to enable resource planning & support the annual & strategic planning processes.

  3. Its purpose is to balance demand & supply in the supply chain. 

  4. It is performed periodically – monthly or weekly.

  5. It aligns operational plans to high level business & strategic plans.

  6. It can be implemented at a market, regional or global level.

  7. At its core is a single set of numbers for the business.

  8. It uses standardised processes, calendars of events & meetings &  KPIs.

There then followed a further discussion about the design of S&OP in mobile telecoms. 

I will; discuss this in a later blog.

S&OP in Mobile Telecom in Africa

Tags: Telecoms, Michael Thompson, S&OP, Forecasting & Demand Planning, Doing Business in Africa

Reasons for establishing S&OP in Mobile Telecoms

Posted by Michael Thompson on Fri, Jun 17, 2011

I have two recent stories to tell.

Story 1

Recently I was chatting to a Senior Executive in a mobile telecommunications company. We first met about a decade ago when he was the Supply Chain Director for an FMCG multinational in Kenya.

S&OP in Mobile TelecomThe conversation was comparing his former life in FMCG to his current life in a mobile telecoms company. I should mention that the FMCG company was a mature business and the mobile telecoms company is a relatively new and growing business.

To paraphrase, it could be summed up in one of his expressions "The energy is great. But I could do without the chaos."

This compares to the relatively stable and predictable working life he remembered from his previous FMCG position.

I should also mention that one of the reasons for this ‘stability’ was that Enchange had implemented S&OP in the FMCG company – that is how we first met.

We reminisced.

“Do you remember when things were also chaotic before? And do you remember how we sorted it  out?”

I continued “Have you ever thought of implementing S&OP in your mobile telecoms company?”

“S&OP in mobile telecoms?  Does it work?”

Story 2

I have just returned from DRC (Democratic Republic of Congo) and met up with a former client manager - she now works for Enchange as a consultant.

In her previous position she was an operational manager and worked on an S&OP project that Enchange implemented in the company. It was a mobile telecoms business.

I asked her if the project had delivered the results that were expected and the extent to which the change had been sustained.

Her reply was revealing.

“Everybody was sceptical at the time the project was implemented. However it ended up transforming (her word, not mine) the way the business was run.”

I asked her to explain. The key difference was that consensus and order had over time replaced bitter argument and chaos.  However, the energy of a new and growing business remained.

“We got the best of both worlds”.

And the moral is?

I mentioned this story to the Senior Telecoms Executive.

Having not even considered S&OP, we are now actively discussing how S&OP could work in his new company – a mobile telecoms business.

More later.

Tags: Telecoms, Michael Thompson, S&OP, Forecasting & Demand Planning, Doing Business in Africa