March 2007 | Commentary | Supply Chain Technology

Global Technology Gets Hyperactive

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Few people in this industry are better suited to wax poetic about globalization and technology than Supreet Manchanda, executive vice president/chief technology and corporate development officer for Brentwood, Tenn.-based 3PL Ozburn-Hessey Logistics. What Manchanda calls his "weird genealogy"—born in India, raised in Africa, educated in London, and a former resident of New York City, Silicon Valley, Washington DC, and Shanghai, among other cities—makes him truly a global citizen. He also holds an Executive MBA from three global universities—London School of Economics, New York University-Stern, and HEC, Paris. From his vantage point as a 20-year veteran of supply chain management and global information technology, Manchanda believes that supply chain technology in the years to come will be all about personalization and the "hyper" effect of everything.

In our recent chat, we cover everything from the supply chain's wireless future to why RFID may go the way of the Betamax.

ARP: Business has clearly gone global. How does that impact logistics technology?

SM: Global technology connectivity is ubiquitous today, creating more opportunities to shrink supply chain problems to manageable sizes and farm them out to specialized providers. Globalization enables this hyper-specialization.

It also demonstrates how business, like water, always seeks its own level. We licked the problems of connectivity, of delivering data to users without the need for intermediaries, and of providing real-time data.

So what now? We have a plethora of small, specialized chunks of information that can be offshored or outsourced. Globalization plays a significant role in solving these problems because it allows us to leverage the knowledge of people in different parts of the world even though they are not physically there.

Also, because of technologies that grant visibility into different transportation systems, companies have become agnostic in terms of where they source. This is crucial because it keeps production going.

Businesses today maintain a lot of goods and services in the pipeline, which is fine as long as the line is flowing and they have inventory outputs and inputs. If the pipeline gets blocked and production is stopped, however, the cascade effect can be devastating.

Leading companies can be toppled quickly if they lose capital, market share, customers, suppliers, and their reputation. In this global age, the difference between leadership and bankruptcy is actually very small. So logistics companies must be nimble and quick to change as processes and conditions change.

ARP: How does visibility technology factor in?

SM: We face the dilemma of too much data and not enough information. Because of this, companies are still searching for elusive visibility and velocity.

Visibility is not only about seeing information, it's about seeing information at the point and time that you need to take action on it to create value. To reach that state, companies need to be able to synchronize information and processes.

Addressing the visibility issue, however, leads to an information velocity problem: How do we synchronize information to complement the process that a certain good or service goes through?

It is easy to say, for example, "We will make x revenue over a certain period." But it is hard to dissect that to determine what revenue came from which transaction with what client, and formulate the information in such a way that it synchronizes itself. This is the degree of customization and personalization that shippers need.

ARP: How does the desire for personalization impact the supply chain?

SM: Most consumers ask for personalization: make my product, my way, in my time frame. Companies that can respond will do well. Today's supply chains focus on creating a rapid association of products/goods/services with the process that gives it value.

That allows us to provide what customers want: hyper-customization, hyper-personalization, and hyper-turnaround. Companies that can implement this type of supply chain will survive; those that can't will fail.

ARP: How else is the logistics technology landscape changing?

SM: I have a bet with a fellow CIO—for bragging rights, and a case of very nice wine—over when we will no longer be wired. I say 10 years, he says five.

With a completely wireless, visible supply chain, logisticians can combine just-in-time information—received from wearable devices set up to provide specified, pull-based data on a certain frequency—with other technologies that will allow us to create the next degree of customization and personalization.

In that world, consumers who order a cellphone could change the color of the faceplate up to one hour before delivery. If manufacturers know where that product is in the supply chain, and what they can do to it to extract premium value, they can boost revenues while giving consumers the degree of personalization they desire.

For this to occur, we need 24/7 connectivity, which can only happen with wireless.

ARP: Where do U.S. companies fall in the global technology realm?

SM: With the exception of the Dutch, America leads. We have a great ability to adopt new technologies and new processes.

But to lead, we have to remember that the 'death of distance' between the United States and India or China means they have access to the same information we do. We have to breed a hunger to be the best that matches their hunger.

In addition, we handicap ourselves by our misconception that everything works in English. While English is the global language of commerce, we leave significant dollars on the table by not creating hyper-personalization using language.

ARP: What is the one technology shippers shouldn't live without?

SM: Oddly enough, I think it is the lowly packing list. Ship notices, UPC codes, and bar-code scanners have grown sophisticated, but at the end of the day, the simple technology of scanning reduces so many errors because it has become automated.

ARP: What is happening with RFID?

SM: RFID is a victim of hype. When you have hyper-data, but have not thought the process through, you run the risk of hyper-misinformation.

If new technologies such as RFID are not piloted and championed by key people and companies, they will go the way of the Betamax. Superior technology with inferior implementation leads to inferior everything.

I'm excited about RFID because if we figure out where to best apply it, and where data security is a non-issue, it can be a magnificent tool.

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