@ Supply Chain Management


Useful SCM Resources – Time to plug in!!

I think that I should take the time to post about useful (and in some cases – very useful) supply chain management resources. And here is one that I subscribe to myself – Supply Chain Digest Letter on specific resources. Choose the one that most fits your palate and get them delivered to your home (free the last time I checked).

The other very useful resource that you may or may not have with you is to get yourself armed with an RSS feed reader. There are several of them that might appeal to you and depending on your OS and choice of browser, the offerings vary. Here’s a top-10 list for RSS readers (among the several that you may find). The reason that subscribing to feeds is important is simply that it plugs you in – into the conversations that are taking place, some connected and some tangential in the supply chain world. They way I would describe it is that it is the Bulletin Board/Forum idea, abstracted one level higher in a very loose sense.

Of course, the small voice in me asks that you might be gracious enough to subscribe to my blog as well. Meanwhile, I am preparing a review for a book that I received in the mail bag – Supply Chain Excellence: A Handbook for Dramatic Improvement Using the SCOR Model. It’s been a good read so far and I should have the review up in a few days.

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Achieving World-Class Supply Chain Collaboration: Managing the Transformation

Achieving World-Class Supply Chain Collaboration: Managing the Transformation is a new report available from CAPS Research (free registration required) published by authors – Stanley Fawcett (BYU), Gregory Magnan (Seattle U) and Jeffrey Ogden (Airforce Inst of Tech). First off, this report is a research oriented report and so it is a virtual gold mine of possibilities. But also of dead- ends and the difference between them are not readily apparent all the time.

In the preface of the report, the authors note that,

"but the world has also, literally, become a more dangerous and risky place in which to do business. Today’s global supply chains are only one terrorist attack, one bird flu pandemic or one not-yet-envisioned threat away from disruption and potential chaos."

These threats in the past would never have affected supply chains of the past. This is not to say that there has not been global trade going on which has been going on for centuries. However, there has been a shift in the sense that the decision to source globally is not only from a point of availability but also from the point of price and value added (i.e. a lot of firms believe that outsourcing/offshoring non-value added activities is a good business decision). One wonders here whether in that non value added determination, whether it was deemed necessary to couple that determination with supply risk. Regardless, we’re well down that path and now we get to face both the pleasures and perils of that commitment.

The irony of change however is well noted by the authors,

Companies have struggled for years to learn how to integrate processes within their own four walls – most still do not! Learning how to build a collaborative team of companies in a world motivated by short-term financial results is a far more daunting task.

So why then the focus on collaboration than making the global supply chain a better one? Well, I guess that’s what the authors wanted to do but I’d have thought that these global supply chains have not yet had the time to settle down before the effort to tack on collaboration enters the picture. Perhaps, the global distribution of participants and stakeholders in the supply chain makes it important but one wonders when collaboration made little headway in the laboratory of the domestic supply chain, one wonders the risks of taking on the challenge globally.

Go on, read the report and see what nuggets you find!!

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How IBM makes radical collaboration work?

How IBM makes radical collaboration work is a special report that BusinessWeek has up at its website. Since I work at the site that forms the ground zero of this radical collaborative venture at and through IBM, I am at the vantage of seeing this happen not so much in evaluating how each of these partners are actually collaborating and creating value but in ensuring that the chip designs and processes of the collaborators actually get executed in the best way possible.

First, Steve Hamm lays out the financial picture of IBM prior to embarking on this radical venture.

By late 2003, IBM’s decision three years earlier to pump $5 billion into its chip business wasn’t looking so smart. The division had lost more than $1 billion in 2002 and was on its way to losing $252 million more in 2003. Investors urged Big Blue to quit, but that wasn’t going to happen. IBM saw leading-edge chip technology as vital to keeping its lead in the highly profitable business of making powerful server computers. Still, clearly, something had to be done.

I must note two different actors in this drama, their respective actions and their reasons which are important to evaluate not so much because they can be pigeonholed as primary reactions but as a sort of chicken-egg dilemma. As reported, the financial fact is that IBM is bleeding money in its semiconductor division. In IBM’s view chip-making is a source of competitive advantage in its high-margin server business and so it views its chip-making (and perhaps chip design) as an important upstream activity. Investors on the other hand, privy as they are to a set of financial facts and numbers, will view a bleed as something that has to be fixed. There are scores of examples that one can find where unprofitable businesses are spun-off or shut down by parent companies that go on to find, fund, nurture and defend other sources of competitive advantage. So why not in this case? What bridges these two camps is the need for a new story, a new strategy, a set of steps that must not only staunch the bleeding but also refresh the bleeding patient. And that’s what IBM has done,

IBM has built what it calls an "open ecosystem" of chip R&D with nine partners, including Advanced Micro Devices, Sony, Toshiba, Freescale Semiconductor, and Albany Nanontech, a university research center. All told, in five separate alliances, IBM partners have contributed more than $1 billion to help expand the company’s facilities and buy the latest chipmaking equipment. But just as important, they’re providing brainpower, including more than 250 scientists and engineers who now work in East Fishkill. As a result, IBM’s chip operation boomed, and, even now, during a cyclical downturn in the chip industry, it’s still making a profit.

How far this sort of collaborative innovation will go is anyone’s guess but it is a stab at the future. What you will note is that there isn’t a magical software that is enabling this sort of a collaboration. If you read more of the article, you will note that this sort of collaboration involves actual engineering teams sitting down together and circumscribing the terms of the collaboration while being open to the road ahead. So mark this down as an important milestone in the collaboration journey:

1. Collaboration requires partners to get down to brass tacks and structure it or at the very least draw a few boundaries and open up a few channels – it also involves the commitment of resources.

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More DTCI links…

The interest in DTCI (Defense Transportation Coordinator Initiative) related material has been surprising. So, I thought that I’d post a roundup of links about it:

DTCI Program Office

DTCI – the beginnings – What the DoD was trying to achieve through the DTCI?

DTCI incorporates lessons from its pilot program – Outlines some of the reasons why DTCI was a successful program; a pilot and then the real thing.

The Big Switch – A lengthy article that highlights the many turns of the DTCI project.

DTCI protest info – Some information about the protest lodged by TIA

My own blog posts about DTCI are here:

Uncle Sam’s looking for a few good bids

DTCI contract awarded to…

High level overview of DTCI


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High level overview of DTCI

If you wanted to know more about DTCI (Defense Transportation Coordinator Initiative), you might want to check out this public link from SDDC – Defense Transportation Coordination Inititative Overview Briefing that provides a high-level summary presentation of the scope of the DTCI contract.

What I’d cue you into are the following slides:

Slide 4 which shows the scale of the US DoD logistics network and conservatively what the Dept. hopes to save.

Slide 7 which is the roll out plan for the DTCI contract which should give you an idea of the complexity of the network and the volume that will flow in it

Slide 8 which is the distribution of the facilities that will fall under the plan

Slide 9/28 which summarizes the Key Performance Indicators (KPIs) that the coordinator is expected to fulfill.

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DTCI Contract awarded to …

Menlo Worldwide. Menlo Worldwide is the winner of the DTCI contract awarded by the US Dept. of Defence (DoD) for all Continental US (CONUS) logistics. DTCI is a huge contract not only to win (which was the easy part) but it’s going to be a challenging one to execute as well,

Under the contract, which is potentially worth $1.6 billion, Menlo will be responsible for deploying and operating an integrated logistics solution for shipment planning, optimization, shipment execution and overall transportation resource management governing all Department of Defense (DOD) materiel shipments moving into and among DOD facilities in the 48 contiguous United States.

They should be congratulated. Their team was as follows:

Menlo Worldwide is prime contractor for DTCI in partnership with the following principal subcontractors:

  • Computer Sciences Corp. (CSC), which will provide IT infrastructure hosting, network management and integration services;
  • ONE Networks Enterprises, Inc., which will provide the transportation management software for shipment planning, optimization and execution, and;
  • Olgoonik Logistics, which will provide professional services supporting the participation of minority-owned and small business firms as service contractors for DTCI.

DTCI was a project that I worked on in my previous firm GENCO for a considerable amount of time – it was a stretch experience for me and so I truly enjoyed it. I blogged about it previously here – Uncle Sam’s looking for a few good bids (Something I worked on)

What I didn’t know then and I know now is the composition of the teams that competed for the project. I didn’t know the teams because the DTCI project was split up into an analysis component which GENCO competed on and won and the execution component which Menlo (or rather Con-Way Inc) has just won.

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Supply Chain Software Once Again Hot Sector – Part 1

Supply Chain Software Once Again Hot Sector reports Investors Business Daily (IBD) in last Friday’s edition of their business rag. They report:

The supply chain gang is back in business.

Makers of supply chain management software fought a rough spending climate as tech budgets froze in the early 2000s.

But over the past year, many of these companies have come back with solid growth and higher stock prices.

Some firms such as Manhattan Associates, JDA Software Group, Logility and Red Prairie,

have recorded double-digit revenue growth in the past year. That compares with a 7% growth rate for all software.

The funny thing is that I had been looking for a job late last year and early this year, not really looking but I was knowledgeable about the state of the Supply Chain software hiring phenomenon. And I did note that these companies and others were expanding their employment base, first a trickle and then much more than a trickle. Its good to know that there was a "real" story behind that uptick.

However, some of this makes little sense:

Several factors sparked the rebound. Manufacturers and retailers face stiff global competition, so their supply chains are more important.

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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August 2020