3D Printing: A Revolutionary Game Changer?

Posted by on Aug 9, 2012 in 3D Printing | 0 comments

3D Printing is one of the most remarkable new industrial technologies now and possibly for years to come.  Believe it or not, the technology has actually been in use since the 1980′s when it was referred to as Rapid Manufacturing.  The terms Additive Manufacturing and Stereolithography have not been added to the mix, although they are simply just more complex names for similar tools.

According to a recent article in Forbes Magazine, 3D Printers have evolved to the point where they can assist manufacturers in building an object in three dimensions. This is accomplished through multiple layers, each only microns thick.  A huge advantage is the elimination of wasted materials which traditionally have been leftover byproducts of the manufacturing process.  Perhaps most impressive is the fact that the overall manufacturing costs can be dramatically decreased through the use of the 3D Printing technology, making it incredibly attractive.

Another positive attribute of 3D Printing is customization without restriction.  By simply changing the sketch or drawing prior to printing, prototypes and models can be easily assembled and then modified.  However, the technology is not just for modeling; it can also be used to make an infinite number of rare parts in industries ranging from airplanes to healthcare. In fact, a San Diego-based company is currently exploring the possibility of using 3D Printing in the production of organic tissues that can then be used to test pharmaceuticals.  It goes without saying that the ability to perform human-type testing without exposing humans or animals to unknown dangers would have enormous potential for the future of healthcare and the prevention and treatment of illness. Remarkably, prosthetics companies are also exploring the use of 3D Printing to create functional prototypes of artificial limbs.  This could play a dramatic role in the rehabilitation of veterans returning from war and serve as a method of reducing healthcare costs for a significant portion of the US population, not to mention provide an improved solution for amputees to regain functional independence.

With any new technology, there are bound to be questions and concerns.  Clearly all of the answers and possibilities are not available without further research and development.  However, advances with 3D Printing are emerging nearly every day and soon we may be regarding this technology as a modern marvel and the solution to accelerated growth combined with reduced cost and ease of use.  You’re sure to hear more on this topic from the popular newsfeeds in the coming months.




What are the challenges to installing supply chain software?

Posted by on Jul 25, 2012 in Supply Chain Software | 0 comments


1. Gaining trust from your suppliers and partners.  Supply chain automation is uniquely difficult because its complexity extends beyond a company’s walls. Employees will need to change the way they work and so will the people from each supplier that a company adds to its network. Only the largest and most powerful manufacturers or retailers (i.e. Wal-Mart) can force such radical changes without repercussions.  Most companies have to sell outsiders on the system first. Moreover, one company’s goals in installing the system may be threatening to their suppliers.

For example, Wal-Mart’s collaboration with P&G meant that P&G would assume more responsibility for inventory management, something retailers have traditionally done on their own. Wal-Mart had the clout to demand this from P&G, but it also gave P&G something in return—better information about Wal-Mart’s product demand, which helped P&G manufacture its products more efficiently. In order for a company to get its supply chain partners to agree to collaborate, business leaders and supplier relations managers have to be willing to compromise and help partners achieve their own goals.

2. Internal resistance to change.  Operations people are accustomed to dealing with phone calls, faxes, spreadsheets or notes on paper, and will most likely want to keep it that way. If management can’t convince front-line operations people that using the software will be worth their time, they will easily find ways to work around it.

3. Some mistakes at first.  New supply chain systems process data as they are programmed to do, but the technology cannot absorb a company’s history and processes in the first few months after an implementation. Forecasters and planners need to understand that the first bits of information they get from a system might need some tweaking. If they are not warned about the system’s initial naiveté, they will think it is useless.

In one case, just before a large automotive industry supplier installed a new supply chain forecasting application to predict demand for a product, an automaker put in an order for an unusually large number of units. The system responded by predicting huge demand for the product based largely on one unusual order. Blindly following the system’s numbers could have led to inaccurate orders for materials being sent to suppliers within the chain.

The company caught the problem but only after a demand forecaster threw out the system’s numbers and used his own. That created another problem: Forecasters stopped trusting the system and worked strictly with their own data. The supplier had to fine-tune the system itself then work on reestablishing employees’ confidence. Once employees understood that they would be merging their expertise with the system’s increasing accuracy, they began to accept and use the new technology.



Supply Chain Cost Reduction is Manufacturing’s Top Priority

Posted by on Jul 11, 2012 in Supply Chain Costs | 0 comments

Reducing overall supply chain cost is manufacturing’s number one supply chain priority in the coming year, according to IDC Manufacturing Insights’ 2012 U.S. Supply Chain Survey of 350 companies. 80% of respondents gave that answer, while nearly 55% suggest supply chain agility is second and 52% suggest improving product quality and safety is the third most important priority.

When asked to rate the level of importance of new technology areas, big data/analytics came out on top, followed by mobility, cloud computing/software as a service and social business tools.

While manufacturers face increasing complexity as customer demand diversifies and supply globalizes, supply chain organizations are adapting to respond to requirements such as:

  • Complex and extended global supply networks
  • Volatile demand
  • Growing regulation, particularly in the area of traceability
  • Pressure to be more agile and increase the clock speed of the supply chain
  • The rise of the Savvy consumer

To address these challenges, IDC has found:

  • Manufacturers continue to increase the amount of low-cost country sourcing. IDC recommends revisiting the profitable proximity sourcing approach and how that concept, supported by IT, can ensure sourcing decisions to create a competitive edge.
  • Most manufacturers view their supply chains as focused primarily on product quality, yet their supply chain priorities usually start with reducing costs, followed by responding to supply or demand changes, ahead of product quality and customer service.
  • With IT-based solutions for demand planning and forecasting and production scheduling viewed as key to manufacturers’ business performance over the next year, this could signal a genuine shift to a more holistic approach to integrated business planning, inclusive of fulfillment excellence.
  • Big data and mobility are the most important new technologies for manufacturers’ supply chains. IDC believes there is substantial value to how manufacturers can use these to improve their agility and customer service.

While there is anecdotal evidence to suggest that 2012 is representing the most challenging time in the history of the manufacturing supply chain, significant opportunities also abound in terms of the supply chain this year. For example, consumer-facing manufacturers have an opportunity to redefine their core relationship with the consumer through mobile and social media tools; or the ability to apply next-generation analytics to massive new sources of data (both structured and unstructured).



What is Supply Chain Management (SCM)?

Posted by on Jul 4, 2012 in Supply Chain Management (SCM) | 0 comments

Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.

The goal of any effective supply chain management system is to reduce inventory, while maintaining product availability.  As a solution for successful supply chain management, sophisticated software systems with Internet interfaces are competing with Web-based application service providers (ASP) who promise to provide part or all of the SCM service for companies who rent their service.

Supply chain management flows can be divided into three main flows:

  • The product flow
  • The information flow
  • The finances flow

The product flow includes the movement of goods from a supplier to a customer, as well as any customer returns or service needs. The information flow involves transmitting orders and updating the status of delivery. The financial flow consists of credit terms, payment schedules, and consignment and title ownership arrangements.

There are two main types of SCM software:

  • Planning applications. Planning applications use advanced algorithms to determine the best way to fill an order.
  • Execution applications. These applications track the physical status of goods, the management of materials, and financial information involving all parties.

Some SCM applications are based on open data models that support the sharing of data both inside and outside the enterprise. This shared data may reside in diverse database systems, or data warehouses, at several different sites and companies.

By sharing this data “upstream” (with a company’s suppliers) and “downstream” (with a company’s clients), SCM applications have the potential to improve the time-to-market of products, reduce costs, and allow all parties in the supply chain to better manage current resources and plan for future needs.



10 FAQs about Cloud ERP Software

Posted by on Jun 27, 2012 in Cloud ERP Software | 0 comments

In 2010, the use of the term “Cloud” was expanded to include a broad set of applications and software deployment models.  ERP software that is deployed into a cloud environment becomes “Cloud ERP Software”. Most (if not all) Cloud environments are built using virtualization and load balancing technology that allows applications to be deployed across multiple servers and database resources.

Many IT industry analysts believe that ERP software stands on the verge of a cataclysmic shift away from on-premise, hosted solutions to solutions hosted in the “cloud.”  While the prospect is alluring, there are questions and concerns.

Here are 10 FAQ’s about Cloud ERP software.

1. What’s the difference between cloud and software-as-a-service (SaaS)? SaaS offerings are typically smaller, niche solutions that are best for organizations with limited complexity, size and global presence. ERP vendors host SaaS applications on their own infrastructures instead of locating the systems on-premise at the purchasing organization.  Cloud ERP means traditional ERP solutions hosted off-site. Its flexibility and scalability are big selling points, as is the capability to access real-time data from anywhere without using complicated and costly remote-access software.

2. What is a “hybrid” cloud option? A hybrid option is basically another way of saying cloud ERP. As touched on above, it’s when organizations purchase a traditional Tier I (SAP, Oracle, Microsoft Dynamics) or Tier II (Infor, Epicor, Lawson, etc.) ERP system and have it hosted by a third-party vendor. This can be a “best of both worlds” scenario for some companies as it provides the flexibility of on-premise ERP solutions with the cost and outsourcing benefits of the cloud.

3. Is it really faster and cheaper to deploy cloud-based solutions? There’s no question that it’s faster (and cheaper) to implement a cloud-based solution than an on-premise. However, an ERP strategy still has to include comprehensive business process mapping, data cleansing, organizational change management, end-user training and a number of other activities to ensure your organization achieves the highest possible ROI. The cost structure of cloud ERP also is quite different than on-premise ERP. Rather than paying one lump sum up-front, organizations must pay for yearly subscriptions to their cloud provider.

4. How concerned should I be about security? Although cloud outages frequently make the news, the truth is that cloud ERP providers typically provide a more stable environment than internal IT departments.  At any point during transmission, the possibility exists that it might be hacked or compromised. To address that, cloud ERP vendors encrypt the data, which can work like a charm but can also cause delays and lead to unforeseen upgrade costs.

5. Who are the leaders in the cloud market? Cloud ERP software heavy hitters include NetSuite, Kinaxis, Plex Systems, Workday and Sales force.  As time goes on, it seems fairly certain that all ERP vendors will have to provide the choice of a cloud-based service in order to remain relevant.

6. How do cloud and SaaS solutions stack up against on-premise solutions? According to an independent 2011 ERP Report, nearly one out of five companies were using SaaS offerings in 2010 (compared to only six-percent of companies in 2009), 24-percent of companies were using hybrid options and 59-percent were using on-premise ERP.  In addition, SaaS implementations were significantly more likely to exceed budget than on-premise initiatives (70.6% vs. 59% for other delivery options).

7. What are the main benefits of cloud ERP? While benefits vary depending on the needs of the organization implementing cloud software, they can potentially include:

  • Cost savings derived from reduced IT staffs and outsourced data management
  • Not having to maintain and secure on-site servers
  • Faster implementation times
  • Fewer upfront costs

8. What are the main drawbacks of cloud ERP? Potential drawbacks can include:

  • Integration between existing processes and cloud ERP applications may be more difficult than integration with on-premise applications
  • Surrendering aspects of operational control (e.g., having to wait for system upgrades rather than implementing them on your own schedule)
  • Trusting an ERP vendor to safeguard and control access to all of your
  • data and systems
  • Less flexibility to change software
  • Pricing structures that actually could cost more in the long-run

9. What size company should consider cloud solutions? Cloud solutions are appropriate for all sizes of companies, although SMBs have historically made up the majority of the market. Larger companies may find that a hybrid approach (i.e., having some aspects of its system in the cloud and some hosted on-site) give them both the benefits of control and the flexibility of the cloud.

10. What leads to cloud ERP failures? Implementing in the cloud does not mean that organizations can take shortcuts. To ensure success, organizations implementing cloud ERP have to be proactive about the same issues as organizations implementing other deployment options (including but not limited to business blueprinting, process-mapping, role definitions, end-user training and organizational change management). There must be formal planning, governance and oversight structures in place and change must be managed from the top down to ensure end-user buy-in. Challenges may be especially pronounced for organizations implementing cloud ERP as their first ERP system because the change will be so dramatic for employees.


Top Five Tips for Accelerating Supply Chain Velocity

Posted by on Jun 20, 2012 in Advanced Supply Chain Planning, Supply Chain Velocities | 0 comments

 It’s more imperative than ever for today’s leading companies to accomplish greater results with fewer resources in less time.  With time-tested principles, such as honesty, integrity, timeliness and quality, here are the Top Five Tips for Accelerating Supply Chain Velocity.

  1. Scrutinize Sourcing Activities. When sourcing key materials and services, consider total value instead of unit price. Total value may include the proximity of a provider to key locations, quality assurance processes, demonstrated past performance, contracted performance penalties, consistency of quality or reject rates, among other factors. It may also include provisions for turnaround times, expediting fees and service-level standards.
  2. Continuously Improve Your Systems. When deciding to replace or enhance systems, find quick-hit projects or low-hanging fruit. For larger projects, put together an incremental improvement plan instead of trying to do everything at once. Seek opportunities where incremental value can be added every 90-180 days. Avoid big-bang implementations taking 12 months or longer. Don’t let years or even months pass without implementing improvements, as small as they may be.
  3. Increase Fulfillment Flexibility and Reduce Cycle Times. Establish fulfillment operations that are flexible and adaptable to meet changing market demands. Reduce cycle times from the source to the customer by streamlining each step in the process, beginning with order release, to picking, to shipping, then the transition (delivery) to the customer.
  4. Replace Your Inventory with Data. Stockouts represent lost opportunities, and excess inventory robs capital from other important and lucrative possibilities. Balance these issues by using data to replace inventory. In other words, think just-in-time not just-in-case.
  5. Seek Out Smaller or Niche Vendors. Big companies grew from small companies that started out being highly successful at doing what they do. When evaluating solutions, look beyond the 800-pound gorillas. Smaller, lesser known suppliers can be more nimble and may be more willing to creatively meet your needs in a short timeframe.



Assessing Inventory Risk With a Multi-Echelon Inventory Optimization System

Posted by on Jun 13, 2012 in Advanced Supply Chain Planning, Multi-Echelon OPtimization Systems | 0 comments

There are a multitude of issues that can affect a supply chain’s inventory. Anything from supplier issues, faulty machines, transportation issues or inaccurate forecasts can affect inventory, resulting in shortages or excesses of inventory.  Inventory management systems must achieve your organization’s required service levels, while keeping inventory costs as low as possible in fast-changing economic conditions, high demand uncertainty and shorter product life cycles.

Today’s advanced Multi-Echelon Inventory Optimization (MEIO) systems are intelligent enough to be used for supply chain risk management.   MEIO systems look at inventory holistically and can help decide the best approach, taking customer service into consideration. Forecast streams, incremental costs, revenue factors, service impact, etc. can all be dynamically modeled in a MEIO system, allowing an organization to review supply chain planning decisions based on their financial impact.  It has the capability to model different layers of supply chain, take randomness into account at every stage, look at the cost and service level requirements, and then decide how much of what needs to be kept at every critical point of the supply chain.  With an MEIO system, you have the opportunity to re-design your inventory plan on weekly or monthly basis so that your supply chain can withstand new conditions.

This technology can make it a lot easier to mitigate inventory risk. An MEIO system with supply chain risk management capabilities would be most useful in assessing the more frequent risks, causing the infamous inventory seesaw effects, rather than risks that may occur less frequently.

Benefits of an MEIO system can include:

  • Reduced inventory  up to 30%
  • Freed working capital from unnecessary inventory  buffers
  • Increased inventory turns
  • Reduced inventory carrying costs
  • Lowered obsolescence rates
  • Increased customer service performance

Risk assessment can never be too accurate.  A Multi-Echelon Inventory Optimization system may be your best tool in simulating, assessing, and mitigating risk factors, and their full impact on your supply chain.



Supply Chain Velocity

Posted by on Jun 6, 2012 in Supply Chain Velocities | 0 comments

How can supply chains ensure that they can maintain the necessary velocity of goods and services not only to meet the potential of threats of disrupting events, but also to effectively manage the supply network in an era of lean and super efficiency? (more…)