Manufacturing Data Collection

It’s the point of decision: the consumer is reaching through the convenience store cooler door to grab her chosen brand. What affected her decision? What if you see each DSD technology touch point involved in getting the product to the store, and understand how it affected the consumer’s decision?

HighJump’s new video makes it easy to understand how a modern DSD suite works together, including route accounting system (RAS), mobile presell and delivery, surveys and data collection, load optimization, GPS tracking and more.

 

Related posts: The Real Components of a Direct Store Delivery Software Solution

 

HighJump’s new VP of Sales, Jim Bork, was in my office the other day and asked me, “Why don’t more people implement our Yard Management solution?” After hearing a customer case study at Innovation 2009, HighJump’s annual user conference, where the customer claimed benefits from yard management in excess of $1 million, Jim wondered why all of our customers wouldn’t leverage this technology. As I started thinking about this question, I realized that maybe companies are looking at the wrong business case for yard management.

 

What is Yard Management?

Yard management is a kind of supply chain logistics software solution that tracks trailers and containers in a yard outside of a manufacturing facility, warehouse or distribution center. Using workflows, the software can support the following activities:

·         Driver check-in or check-out including collecting all relevant data from the driver and tying the arrival to a specific dock appointment

·         Optimized storage of trailers or container within the yard. Trailers with “hot” product can be moved directly to dock door locations. Other trailers can be dropped in the yard for unloading in the future.

·         Visibility to trailer aging is provided so companies do not incur demurrage charges for holding a trailer in the yard for excessive time periods. (Trailers and containers are typically owned by a 3^rd party and holding them for too long can trigger a charge called demurrage).

·         Optimized work instruction is provided to yard drivers for moving trailers to and from dock door locations.

 

 

Work Optimization – The Old Thinking

Yard management provides benefits on multiple levels, however, most supply chain management professionals first think of the work optimization as the primary benefit. Work can be optimized creating labor savings and more efficient flow of inventory. However, if you “run the numbers” on a typical yard, labor savings alone will not drive a strong ROI on a labor management system.

 

The Safe Thinking

Safety and security has become a primary concern for many businesses in light of focus on national security in many countries.  A yard management solution will also provide benefits in the area of safety and security. Yard management systems help facilitate a single point of entry and exit from the yard. Additionally, a yard management system will systematically collect information about specific loads that could be used to comply with internal or homeland security requirements. While safety and security are important it is difficult to build a hard business case around these factors.

 

Inventory Optimization – The New Thinking

Companies with the most successful yard management initiatives find ways to optimize inventory across the yard, manufacturing facility, and distribution center. As companies in the US and Western Europe are transitioning from manufacturing-centric to distribution-centric, inventory in the yard has become a serious issue. Import-centric supply chains leverage low cost of materials and product, but suffer from long lead times and product obsolescence. Often this results in large amount of inventory being held in containers in the yard.

 

The best way to build a business case for a yard management system is treat your yard like an inventory buffer. An inventory buffer in the yard will allow many companies to carry additional inventory without facility expansion in their distribution center.
An additional inventory buffer provides significant benefits in terms of supply demand matching and perfect order performance.

 

HighJump has one yard management customer who drops orders to the warehouse for fulfillment even when the expected inventory only exists in the yard. This means they must coordinate a trailer move of inventory to the dock door, cross dock the needed product, and marry it with the other product required for the customer’s order. Clearly, this logistics capability is something to build a business case around!

 

So before taking your yard management system business case to the corner office, ensure you have considered all aspects of intelligent inventory positioning and supply chain management best practices that can be gained from a yard management system.

One of the top reasons people buy HighJump systems is because HighJump applications are designed to easily adapt to the way you do business - not force you to twist your business processes to fit the software. The adaptability promise continues with HighJump's new business intelligence application - HighJump Performance Advantage.


In a nutshell, HighJump Performance Advantage allows supply chain customers to view summary-level operational data in the form of graphical dashboards, and then drill down to root cause in order to correct any problems. Over time, this ability can lead to significant process improvement in a warehouse/DC or manufacturing shop floor.

It's easy to create personalized dashboards to suit your own operation. And you can set up dashboards for every user persona in your operation. Ex: an outbound dashboard for your shipping manager, an inbound dashboard for your receiving manager, and a capacity and utilization dashboard for an exec or warehouse manager.

Pretty cool stuff, but also very practical usage for HighJump customers interested in supply chain improvement and a way to give access to business performance metrics - and a route to operational improvement - to all members of the team.

Check out sample dashboards here: www.highjump.com/performance_management

I recently visited one of HighJump’s manufacturing customers in Iowa. Their shop floor makes up several product lines, is very complex and spans over 900,000 square feet. They run our manufacturing execution system software (MES) to manage the shop floor and direct over 600 employees. While their throughput is down due to the macro-economic conditions, it was refreshing to see complex manufacturing alive in the United States.

 

Every time I read an article about manufacturing, the drum seems to get louder about manufacturing getting outsourced and its inevitable departure from the United States. A recent Business Week article postulates that we might have entered into a permanent ‘invented here, industrialized elsewhere’ environment.  While I do not necessarily disagree for industries that have already completely left the cost to bring them back will be too high; I think there are other factors to help mitigate the transfer of industries that still have manufacturing in the United States:

 

Regulations and Protectionist Policies

Increasing regulations and risk of protectionism will drive up the costs of manufacturing elsewhere. Contrary to the promises of the G-20 about commitments to free trade, we recently slapped a 25-35% duty on tires from China. As the economic recovery starts, if countries resort to more protectionist policies this will need to be factored into an outsourced manufacturing decision. In addition we see additional regulations around imports; 10+2 being the most notable regulation scheduled to go live early next year. While there could be long-term savings from automation, the data collection effort can be significant and difficult depending on the technology infrastructure of companies in the supply chain so the corresponding upfront cost is not insignificant.

 

Demand Variability

Many companies moved manufacturing to Asia because of the significant cost benefits. One of the common trade-offs was the long lead times to ship the product to the United States. For companies that have a hard time predicting future demand (I am guessing there are a few out there) this creates a situation of either losing out on sales or loading up more inventory at different points in the supply chain. The more working capital tied up in inventory; the less money there is for the rest of the business. I think you will see more companies move toward a ‘near-shore’ strategy where they move non-strategic manufacturing to lower cost countries that are closer to the target market. In the case of the United States, Mexico fits the bill. Our customer has done exactly that by opening up a manufacturing plant in Mexico for the lower-end product lines while keeping the strategic product lines in the Midwest.

 

Government Incentive

One factor that has been absent up to this point but that I would greatly applaud would be for the US government to perform a review of our manufacturing capabilities and determine which are of strategic importance from a national security and ability to innovate standpoint. Then provide the right incentives to keep/enhance our core competencies in these areas, it sure beats the short-term incentive to pay people to pick up a shovel to build a road.

 

Hopefully our customer is not the only company that can make the proper assessment of what is strategic and what is not when it comes to manufacturing capabilities.

There has long been debate about off-shoring or near-shoring manufacturing capabilities and whether this is good for the United States. While I will not delve into the heart of that lengthy debate, “Made in the US” has long been an important buying criteria for large segments of the American population and has become even more important in the economic downturn as a renewed emphasis has been made on buying American, albeit with protectionist risks.

 

However, a recent study by the American Small Manufacturers Coalition (ASMC) states “over a quarter of American manufacturers – representing over 90,000 firms – are at risk because they are not at or near world-class in any of the six strategies.” So what exactly are Americans buying if a product is “Made in the US”? The ASMC study details six strategies that are required for global competiveness:

 

• Customer-Focused Innovation (CFI)
• Engaged People/Human Talent Acquisition, Development and Retention (EPT)
• Superior Processes/Improvement Focus (SPI)
• Supply-Chain Management & Collaboration (SCM)
• Green/Sustainability (GS)
• Global Engagement (GE)

This is particularly concerning as companies in China, Eastern Europe and elsewhere continue to build out more robust manufacturing capabilities. Of specific concern are our deficiencies in Supply Chain Management and Collaboration. A key component of world-class supply chain infrastructure is an investment in modern technologies such as manufacturing execution system software or manufacturing data collection. If our manufacturing companies, due to macro economic factors or industry specific dynamics are under-investing, it is unlikely they will be able to compete in an increasingly global marketplace. While this is concerning, we need to heed the warning bell that the ASMC raises and use this as a catalyst for action, rather than let it become a leading indicator to a decline in the “Made in US” moniker.

 

You can read the full report here.

Image via Flickr user shawdm.

HighJump Software today announced it has achieved integration validation with Oracle’s PeopleSoft Enterprise Supply Chain Management (SCM) 9.0 for both HighJump Warehouse Advantage and HighJump Data Collection Advantage. HighJump Software has maintained a strong relationship with PeopleSoft and Oracle for more than 10 years by providing integrated manufacturing data collection, inventory and warehouse management solutions for Oracle’s PeopleSoft Enterprise SCM products. This relationship has resulted in more than 80 joint customers.

Read the full press release.

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Have you ever anxiously awaited the results of an exam wondering if you had even received a passing grade? I must admit that there were a few electrical engineering courses in college where I hoped the “curve” put me into passing range. I had a similar feeling when reviewing HighJump Software’s direct to store delivery software capabilities against a list of “next generation” technology capabilities to support direct to store distribution processes.

I recently had the opportunity to participate in a panel discussion at the Grocery Manufacturer’s Association Information Systems/Logistics Distribution conference. The panel was chaired by Lora Cecere from AMR Research and consisted of leaders from several software companies that provide direct to stored delivery (DSD) software. 

The GMA has a committee of DSD manufacturers who have identified “next generation” technology capabilities to support their DSD processes. I will highlight a few of these next generation capabilities and explain what HighJump Software is providing in these areas.

In Store Survey Assessment for Competitive Information – in Mary 2008, HighJump Software launched HighJump™ Survey Management.   This new product integrates with existing HighJump mobile pre sell technology and allows competitive information to be collected in the field and analyzed at headquarters by sales and marketing professionals. 

Return and accounting for marketing materials, coolers, display units – management of non-product assets in the direct to store delivery supply chain is critical. These items could be point of purchase merchandising materials, branded coolers, or beer tap handles. In the battle for consumer mind share, the proper tracking and delivery execution of these materials is as important as the product itself. HighJump’s route accounting systems (RAS) have capabilities to manage and track these promotional materials.

Near real time synch – significant technology advancement has occurred in this area. As rugged mobile computers have advanced with cellular data connectivity, the ability to leverage real time information in the direct to store delivery process has increased. With HighJump direct to store delivery solutions, the mobile workforce has the ability to view inventory and place orders in real time. Additionally, with the HighJump™ Usable GPS management can gain real time visibility to the location of their mobile workforce and view progress against a previously scheduled route. 

Based on these emerging trends in direct to store delivery technology, I would have to say that HighJump Software receives a passing grade (likely better than just passing). It seems that our over 500 direct to store delivery customers have helped steer our product in the right direction.