@ Supply Chain Management


Logistics Quotient: Midwest USA

LogisticsToday and Expansion Management offers a matrix that summarizes the state of logistics practices, environment and competencies by cities in the Midwestern part of the US – they call it the Logistics Quotient : Midwest.
The methodology,

The Midwest Regional Logistics Quotient matrix provides an overall ranking of each city within the Midwest region, assigning a rank of 5 stars to the top tier, 4 stars to the next group and so on down to a 1-star rank

LogisticsToday and Expansion Management also list their 10 logistics categories in which the midwestern metro areas are ranked. They are:

* Transportation and distribution industry–based on business and employment base providing transportation, distribution, warehousing and related services.
* Work force–geared to existing and available logistics-related workers in the area.
* Road infrastructure–measures factors like available lane miles per capita, interstate highway access, miles of paved
roads etc.
* Road density, congestion and safety–ranks the city on traffic volumes and delays as well as accident statistics and other factors affecting the smooth flow of traffic.
* Road condition–draws on state performance and includes condition of highways and bridges among other measures.
* Interstate highway–includes access to interstate highways, spending on highway construction and maintenance.
* Taxes and fees–provides a measure of logistics-related costs, including highway and fuel taxes and related business activity taxes.
* Railroad–offers a state-based rank of access to Class 1 and other rail services and miles of track.
* Waterborne commerce–includes ocean port capacity as well as inland waterways.
* Air cargo–ranks the city on its access to cargo services, including wide-body passenger service by combination carriers, international and expedited services.

This kind of information is invaluable to me when I engage in Supply Chain Network modeling and consulting on the basis of this. This sort of matrix allows for easy comparison between geographical locations and the costs thereof of operating within them.

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SCM Newz roundup

1. State of Washington Considering Restrictions on RFID Technology
SC Digest reports on an effort by a lawmaker from the state of Washington to restrict the use of RFID technology. He has introduced an “Electronic Bill of Rights”,

that would put significant restrictions on the use of RFID in an effort to protect consumer privacy

So what is the scope of this legislation?

The proposed bill would outlaw the collection, storage, and disclosure of information gathered through radio frequency identification technology without notifying consumers. The bill states that all companies using active and passive RFID devices would have to either disable the devices or gain consumer consent.
The measure would prohibit companies from mandating that consumers have RFID tags for service or refunds. It would also prohibit people and companies from scanning or reading the devices to identify consumers without first obtaining consent.

Firstly, I didn’t think that companies really wanted to know how many cans of Coke are in your fridge at this present moment? Assuming ofcourse, they’re able to differentiate that from the number of crushed/used coke Cans that are in your garbage. Such a level of granularity might be quite important for marketing purposes but I would think that its efficacy would decline on an operational level as far as the consumer is concerned. Nevertheless, who knows what an innovator would come up with in order to invade a consumer’s privacy? But isn’t it within the purview of the consumer to punish such a firm by not consuming such a product?

2. Supply Chain Strategy: Home Depot says it’s Ready for Supply Chain Transformation
SC Digest reports on a new initiative by Home Depot with regards to its supply chain.

In the face of slowing sales growth and a slumping stock price, home improvement retailer Home Depot plans to increase investment in logistics infrastructure by $900 million, with a big focus on inventory management and improved central distribution.
The comments came from Home Depot execs at the company’s annual meeting for financial analysts.
The moves clearly reflect in part the impact of Home Depot’s VP of Supply Chain Mark Holifield, who came to the post after a similar and well-respected stint at Office Depot.

Hey, I’m all for supply chain improvements but this is a joke. Just look at the news item itself. In the face of slowing sales growth and a slumping stock price, what does Home Depot plan to do? Improve its supply chain? What is wrong with this firm?
Anecdotally, Home Depot’s sales growth is slowing because Home Depot sucks at selling. Is sales growth slowing because of the lack of the proposed solution below:

improved inventory management, implement a system that will provide better visibility and control over products delivered to the home, improve visibility of product flow from suppliers all the way to the store shelf, and cut order-to-delivery lead times, and improve inbound distribution.

What is Home Depot smoking? And on the same note, what is Lowes doing right?
Read the rest of this entry »

About me

I am Chris Jacob Abraham and I live, work and blog from Newburgh, New York. I work for IBM as a Senior consultant in the Fab PowerOps group that works around the issue of detailed Fab (semiconductor fab) level scheduling on a continual basis. My erstwhile company ILOG was recently acquired by IBM and I've joined the Industry Solutions Group there.

@ SCM Clustrmap

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March 2007