Trends—December 2016

Trends—December 2016

Happy New Year! Time for Your Annual Supply Chain Health Check

Throughout the course of 2016, your supply chain was plugging away, receiving and handling new product lines, efficiently fulfilling e-commerce orders during slow times and peak periods, dealing with returns, and processing shipments to your stores and/or retail customers to ensure timely and accurate deliveries.

To prepare for even greater demands in the coming year, Eric Lamphier, senior director of product management, Manhattan Associates, recommends that you evaluate your supply chain’s 2016 performance and do the following health check to ensure you’re ready to hit the ground running in 2017.

Is your supply chain visibility 20/20?

Take a look at the past year. Was your organization able to handle and manage inventory, ensuring optimization even during peak periods? Were deliveries successfully executed on time? If not, it’s time to check your supply chain visibility.

To succeed in today’s landscape, organizations need a single, unified end-to-end view of their global supply chains. With a granular understanding of global inventory through improved supply chain visibility, organizations can optimize their warehouses and better ensure fulfillment success, no matter where the demand originates.

Is your operation fit to run a next-day delivery marathon, every day of the year?

The convenience factor of next-day delivery has the e-commerce world on the hook. But with this delivery method comes increased pressure in the distribution center.

If your warehouse management system (WMS) is in tip-top shape, you’ll be able to better manage labor, inventory, space, and compliance. This will increase distribution center functionality, allowing for quick order turnaround time, and will ultimately give your supply chain the stamina it needs to run the next-day delivery marathon year round.

Would your labor management approach pass a temperature check?

Labor management and planning account for more than half of warehouse costs on average, so it’s financially critical to keep these systems functioning smoothly. Low employee productivity, inaccurate picks, high turnover, safety issues, high overtime—these are all signs that your labor force isn’t optimized.

If a temperature check of your labor management and planning reveals turmoil in the warehouse, it might be time to invest in this area. Incorporating mobility in your labor management strategy will greatly expedite processes by putting managers on the floor to resolve issues fast. Mobile training tools are also helpful, as they provide a familiar interface that employees can use to get up to speed quickly.

The health of your supply chain ultimately informs the health of your business. As we head into 2017, don’t forget to do a supply chain health check to ensure you’re implementing the right technology and driving optimization in the year to come.

Vets Help Battle Driver Shortage

Veterans still suffer from unemployment at a rate of 5.8 percent, nearly one full point higher than the national average. Meanwhile, the trucking industry continues to face record driver shortages that impact capacity and long-term growth. With nearly 250,000 personnel leaving the military each year, veterans could be the answer to that problem.

After all, veterans make for superior truck drivers, according to research performed by Omnitracs, a provider of fleet management software solutions. Veteran drivers had 42 percent fewer accidents than non-veteran drivers, and achieved 98 percent more miles driven, according to the study. Veteran drivers also had 59 percent fewer voluntary terminations and 68 percent fewer involuntary terminations, the study says—an important statistic in an industry suffering from a lack of new workers and an all-time high turnover rate.

Veterans come into the job with many skills and attitudes that translate directly to driving over the road. "The parallels between the trucking industry and the military life are right on point in that veterans are used to being away from home," says Rick Bucholtz, associate director of field and government recruiting for supply chain solutions provider Werner Enterprises. "Their families are used to them being away from home, so on the family side, they have everything in place to handle it when the service member is away, or the professional driver is away from home.

"Also, being out on the road, vets work under minimal supervision," he adds. "They have to be able to make decisions. They have to be able to assess and take action without being told exactly what to do. Veterans fit into that.

"Veterans also have all the soft skills and intangibles that the military service member brings to the table. They’re flexible, they’re loyal, they’re teachable, their coachable, they can take orders, they can give orders, they can make decisions. They show up on time, they have attention to detail. All those little things that have just become part of their DNA as a service member translate well into the trucking industry," Bucholtz says.

Hiring veterans as drivers may save carriers time as well. The Federal Motor Carrier Safety Administration recently expanded its veteran transition program to give waivers on the skills portion of the CDL application for veterans who have experience driving similar equipment in the military. For companies struggling to combat the driver shortage, a veteran-hiring initiative might be one solution.

Can You Hack It?

No matter how secure a company’s IT infrastructure may be, it’s still possible that hackers could gain access to important data by breaching firewalls somewhere down the supply chain. More than 85 percent of businesses have digital capabilities in their supply chain, or will have them in the next year, according to Chief Supply Chain Officers: Do You Know Where Your Weakest Link Is?, a report from Accenture.

Cybersecurity isn’t just within the purview of the IT department, but 50 percent of companies surveyed by Accenture don’t have supply chain risk management aligned with cyber security operations. Only 11 percent of companies have the chief supply chain officer in charge of cyber supply chain risk, the study shows.

With the amount of data at risk—such as sales and marketing information, product designs, and customer contact and billing information—supply chain cyber security should be escalated to a C-level concern at all companies with a digital supply chain presence.

The first step is admitting that no company is impervious to cyberattacks. To be prepared for the worst, all partners should be willing to subject to a security audit, and regularly verify their vigilance, according to Accenture. Just one company in the value chain with low security raises the risk level for everyone else along the chain.

Securing Your Physical and Cyber Assets

Today’s supply chain has evolved beyond traditional manufacturing and distribution to include an array of ever-expanding organizations—all digitally connected and all with cybersecurity exposures. From external specialty manufacturers with access to your latest designs, to GPS data from your truck fleet, to a maintenance service provider with access to your vendor portal, your supply chain is vulnerable to attack by cyber criminals.

Here are just a few questions to consider:

  • Does your manufacturing partner have access to your formulas and designs?
  • Who has access to your shipping manifests and delivery routes?
  • Do you know the background of your truck drivers?
  • Does your temporary staffing firm share accounts and passwords to your portal?
  • Has anyone checked how well any of these companies are protecting your data?

SOURCE: Chief Supply Chain Officers: Do You Know Where Your Weakest Link Is? Accenture study

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