Tag Archives: SCM Control Tower

Supply Chain Control Tower: Providing Greater Visibility, Flexibility and Efficiency

A well-managed supply chain provides companies a competitive advantage and increased profitability.

A solution that has been gaining momentum recently is the transparent supply chain process referred to as the SCM Control Tower. Control Tower acts as the supply chain nerve center, utilizing technology, organization and processes that capture product movement visibility from the supplier all the way to the customer. It allows the 3PL customer to collect and use timing, efficiency and service data in real time for short- and long-term planning and decision-making, and it assists them in aligning and realizing strategic objectives. The customer becomes engaged in the entire process across multiple domains, at a level of involvement that caters to the company’s needs.

The flexibility of an SCM Control Tower is key to the service it provides. Its role or focus can change according to the individual needs of a supply chain customer. It is very much a concept of scale; it can be part of the solution or all of it. The real-time analysis of data enables supply chain managers to immediately address questions or issues that occur unexpectedly. They can detect what is happening and determine best practices for response. Additionally, they can identify trends and anticipate potential issues that may arise in the future. The data collected allows them to analyze opportunities, mitigate risk and formulate response strategies. Simply stated, an SCM Control Tower gives customers the information they need to make informed decisions by utilizing pure visibility of daily services and tactical administration.

The most vital SCM Control Tower component is the coordination of activity along all aspects of the supply chain. Improved visibility increases the customer’s knowledge across all domains: manufacturing, inventory, demand, transportation, customs clearance and service — all aspects involved in the day-to-day operations.

For example, at the local level, a 3PL customer can coordinate with the carrier that makes a pickup, while at the same time communicating with the supplier to determine the availability of material for pickup. The customer is able to interface within the system to monitor the process from beginning to end. The customer can coordinate with port compliance for export documentation, ensuring that all paperwork is available to the customs broker for clearance. Shipments can be tracked and traced upon arrival, and required information is made available to the inbound customer’s broker for clearance.

Along with coordination, end-to-end visibility also provides the opportunity to catch and manage a potential crisis along the supply chain. Sometimes issues pop up and decisions need to be made quickly. For example, suppose a shipment is travelling LTL, and it unexpectedly becomes “hot” en route and has to be diverted — possibly going by air — in order to get to its destination faster due to a production need, or it may even need to go to a new destination. The coordination and management necessary to execute such changes require the visibility of an SCM Control Tower.

 

Does The View You Are Seeing Tell The Whole Story?

Hmmm! We have a Supply Chain Control Tower, we see EVERYTHING. Yes, we made a list of every element in our supply chain. Now we find that not all the data feeds are  Integrated!!!
It is not a monumental task to roam around a company and fill out a list of files available from existing systems to add to what is available in your Control Tower. The magic is to try and coordinate/integrate them! The technologies that create these files never seem to be the same and prove difficult to integrate. There might only be a similarity at a higher level. Sometimes many files are created and will require a lot of effort sorting through redundant data. These are sometimes termed “assemblies”.

Then you will find other data feeds that are created by related systems. Some of these systems are purchased and others have been created in-house. And yes, they depend on a higher-level integration effort of one kind or another. So why are they still not right and don’t fit into the perfect scheme of things?

  • Different technologies
  • Lots of redundant data
  • Not cross-functional (obviously not because they were created in a “silo”)

The conclusion we are working towards is that every data element that we will be displaying in our control tower MUST be based on common definitions.

  • Every component (business unit, warehouse, etc) in the supply chain has a unique identifier.
  • Every data element (purchase order, invoice and on and on) has a unique definition all the way across the supply chain.

Dyson Is Building A Supply Chain Control Tower

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Dyson is the company, located in the UK, that creates those revolutionary products: fans, vacuum cleaners and other consumer things. Owner James Dyson is both an inventor and a sharp businessman.

They are building a Supply Chain Control Tower in order to give his company a competitive advantage. The company is trying to engineer a supply chain based on “build-to-order, rather than build-to-forecast” as a way of reducing its store keeping units (SKUs).

Working with them are their lead logistics provider, Flextronics; and supply chain software supplier Elementum.

Dyson chief operating officer Jim Rowan explained the system: “We know that the supply chain can drive financial performance and the bottom line. But if we can harness the complexity in the supply chain and turn it into an advantage, then we can use it to improve the top line as well,” he said.

The system comes as a cloud-based mobile app with three constituent parts: Transport, which manages freight routes and tracks shipments as they move across the world; Exposure, which allows shippers to highlight specific risk hotspots in the supply chain and monitors their situations; and Perspective, which monitors the “health” of a supply chain, defined by individual shippers’ KPIs.

While he extolled the ambition of a mobile application that allowed his supply chain team to work remotely, Mr Rowan said the physical location of staff also continued to matter.

We are building a control tower at Dyson which will show all the parts in our supply chain,” he said. “It will have 16 screens constantly monitoring transport routes, risks points and the quality of products – it will be a physical control tower.

If you have six people looking at these screens, providing constant analysis, then magical things start happening in terms of developing really creative solutions,” he said.

The control tower is due to be operational in July.

Dyson’s annual supply chain involves managing two billion parts from 300 suppliers, which are delivered to four factories that produce eight million appliances.

Not the most complicated supply chain in the world, but with  two billion parts a year, it is complicated,” Mr Rowan added.

SUPPLY CHAIN CONTROL TOWERS GO BIG TIME

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When we got into SCM Control Towers, there were not too many others (you know, the “experts” who appear in your mailbox every day and draw crowds at those big conferences) who were writing about them or building them.

BUT WE TALKED A LOT ABOUT THEM AHEAD OF EVERYBODY ELSE

Now the “big guys” are finally getting into it.

So let’s recreate what we have published and give you some great material.

12 February, 2013

A new term is appearing in the supply chain arena: “Supply Chain Control Tower”. Just as an airport control tower coordinates airplanes landing and taking off, a Supply Chain Control Tower coordinates inbound and outbound distribution flows. Sure sounds more professional than a “dashboard”.
It is all about “knowledge”. Air controllers get information on weather, speed, direction, and altitude of aircraft and use that knowledge to keep their air space safe. Companies must know what is happening with their supply chains so they can prevent disasters too. They need to be able to do “what-if” analysis and work their way around events that will cause disruption and risks to the supply chain

10 May, 2013

Who Sits Where In The SCM Tower

The Global Supply Chain Forum has identified eight key processes that make up the core of supply chain management: (1) Customer Relationship Management (provides the structure for how the relationship with the customer is developed and maintained); (2) Customer Service Management (the company’s face to the customer); (3) Demand Management (coordinates all acts of the business that place demand on manufacturing capacity): (4) Order Fulfillment (integration of the firm’s manufacturing, logistics and marketing silos); (5) Manufacturing Flow Management; (6) Procurement (supplier relationship management); (7) Product Development and Commercialization (integrating customers and suppliers into the product development process in order to reduce time to market; (8) Returns.

In my first take at staffing the SCM Control Tower, I have Logistics, CRM, Demand Planning, Procurement and EDI/Electronic Commerce. I’m not far off the mark. I am covering all the “processes” that the Forum covers. In the Forum’s approach, everybody still reports organizationally in their own “silo” and proper operation of the SCM Control Tower depends on collaboration among the silos

21 June, 2013

SCM Control Tower Team Troubles

You are in the process of staffing your SCM Control Tower. This group will be drawn from different areas of your company (different “silos”) and different skill sets (for example, a “hazmat” expert). Is your SCM Control Tower going to be a team building melting pot or a boiling cauldron of dis-function. You could draw the brightest and most hard working employees in and outside of your company; but if they don’t get along, it could wreck your business.

 

19 August 2013

SCM Control Tower Functions

Our Supply ChainControl Tower is up and running. Yes, the idea makes a lot of sense, but what are the benefits? How do we make full use of our resources? What else do we need to add to it?


If you take a look at an airport control tower, it usually is a boring place. Yes, they work around the clock but all you see is a super smooth operation. Operators viewing screens and talking calmly into headsets. When it is not “boring”, they usually throw visitors out. Our goal with our SCM Control Tower is to make it a “boring” place.

Airport towers handle incidents on the ground like failed landing gear. They handle incidents in the air like a “near miss”. They even reach out to other airports: anybody ever sat in an airport waiting for your destination airport to plow its snow, or whatever?

So all the time our SCM “tower operators” are monitoring for aberrations: in-house; with the suppliers and service providers; and the external World. They are looking for anything that has, will or might interrupt the supply chain. When ever, let’s call it an “incident”, is detected, the tower operator first determines if it has already occurred.

05 September 2013

Transportation Control Towers

We have been talking a lot about Supply Chain Management Control Towers. Yes, transportation (usually under logistics) is included in the control tower. In many companies, transportation is outsourced to a 3PL, 4PL or 5PL provider. This provider is an expert at hooking your company up to any required transportation resources. Your provider already has some excellent tools available. A popular concept since the 1990’s has been the “Load Control Center” (LCC). We are looking at outsourcing, but yes, excellent software is available if you do it yourself.
Transportation has always been an opportunity to centralize and get some benefits. 3M started the concept of Load Control Centers(LCC) and lots of others followed suit. The LCC is simply centralization of transportation planning and execution. Benefits include:

  • better pricing from centralized transportation sourcing

  • development of standardized operating procedures

  • fewer planners than in several separate operations

  • ability to combine more shipments and loads because of greater visibility

  • electronic integration with carriers

 

4 November 2013

SCM Control Towers and BIG DATA

Control towers are used in many industries for different purposes: airports and railroads use them for traffic control; power plants have control rooms to monitor operations and third party logistics providers use them to track transportation activities. These are places where operations run well. Why not a “SUPPLY CHAIN MANAGEMENT CONTROL TOWER” to monitor and assure supply?

The SCM Control Tower is all about having visibility throughout the supply chain. But if there is total visibility and no ability to make decisions, then it is not a control tower. To be a decision maker, you will need to run “what if” scenarios: forecast and recalculate the entire inventory if “your ship doesn’t come in” (something that literally could happen). To be able to calculate effects of events, it will require a LOT of data. Hence, we need to introduce BIG DATA to our Control Tower.

HEY, I have a GREAT IDEA. If you have more stories or things to add, Send us your story (on the contact form) and WE WILL PUBLISH IT

SCM Control Tower Start-Up

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We have been gathering a list of issues that need to to be resolved before building a Supply Chain Control Tower: SCM and IT partnership; Visibility; Strategy and expectations; Foundation for the tower; and Team-building.
SCM and IT partnership
The supply chain functional teams are expecting support from Information Technology. Up to now, many IT organizations have not been heavily involved with a lot of the supply chain; for example, the Procurement system could be a package that is supported directly by the vendor. How about bringing the teams together by emphasizing IT network management skills? IT manages complex wide-area networks using state-of-the-art applications. SCM will rapidly understand that IT brings real value to the party.

Visibility
Scott Koegler recently wrote about “Combined Data and Visibility”. He pointed out that the number of systems or software applications that make up the supply chain within a single company is likely to be more than 1 and could easily be as many as 20. If that’s the case how is it possible to actually achieve what we’ve been calling visibility? He quickly dispelled the notion that all data for the SCM Control Tower can come in real time from the EDI system. So a conclusion is that the SCM Control Tower will need what is called “middleware”.

Read More about Starting Up A Supply Chain Control Tower

Supply Chain Intelligence: Using Your Visibility

ImageImageWe know that supply chain visibility is a requirement for any company competing in today’s global marketplace. You must be able to see something if you want to manage it. It is the key to Supply Chain Management. We have talked about the Supply Chain Control Tower and who sits in the tower, now we are going to talk about what should be going on in the Supply Chain Control Tower and what it can do for you.

Good Supply Chain Management procedures lower inventory and costs. So why do a lot of companies have trouble putting it all together? Everyone already has electronic identification/bar coding on just about everything. Lower-tier suppliers are very cooperative sharing their data. No, it’s not a report you want to see. That is something in a rear-view mirror. Instead you want to see a real time micro view of where everybody and everything is at. Basically, it is an exception report: things that aren’t right.