Supply Chain Now Radio Episode 266
Prefer to watch the podcast in action rather than just listen? Watch Scott and Greg as they welcome Erik Green and Paul Noble to the SCNR Studio for Episode 266.
Listen as Scott and Greg welcome Erik Green and Paul Noble to the Supply Chain Now Studio in Atlanta, GA.
[00:00:04] It’s time for Supply Chain Now Radio Broadcasting Life. Supply chain capital of the country, Atlanta, Georgia. Supply Chain Now Radio spotlights the best in all things supply chain the people knowledge, the best practices and the critical issues of the day. And now here are your hosts.
[00:00:29] All right. Good afternoon, everybody. Welcome to our webinar on Supply chain. Now we’re webcasting live today from the Supply chain Capital, the country, Atlanta, Georgia. My name is Scott Luton. I’m your host for today’s session, along with my trusty co-host, Greg White. Greg, good afternoon.
[00:00:45] Hey, good afternoon. How are you doing?
[00:00:47] I’m doing great. Excited for the topic. We’re gonna be tackling today in our first webinar of the year. Your first one in quite some time. Yeah, the podcast program is kind of taken over. Yeah, it has. But great topic to kick off the year where our webinar program for the year with. We’re gonna be diving into how A.I. artificial intelligence and digitization, that practice that works have very good arms this morning is driving visibility, effective harmonization and really overall organizational success. Yeah, big topic.
[00:01:17] Yeah. Well, I mean I is it’s it is the big topic. It’s relevant, it’s important, it’s impactful, it’s complex and it’s a bit confusing. So the goal of this, you know, at least in part, is to help clarify what I can do practically for a company. So and I think we’ve got a great a great team here to help us do that.
[00:01:37] We do. In fact, our two guest speakers today, Paul Noble, founder and CEO of VeriSign, and Eric Greene, a practice lead at Accenture. And we’re going to share more information about both of these leaders in just a moment. But as always, we’re glad to have our guests here today with his own supply chain now. OK, real quick, let’s tackle our ground rules, right? All attendees will be on mute as we’re looking to optimize the audio experience. Now, with that said, let’s do make it as interactive as possible. Paul and Eric both have challenges that given the hardball questions. Yeah, you’re right to stand and deliver. I’m I’m kind of kidding tongue in cheek. But we do want to make this interactive. The Q&A sessions of these webinars are typically some of the most rewarding interactions. So I hope but submit your questions to be the chat toolbar, which probably is on your right hand side. And then at the end, as we enter into the Q&A session, we’ll we’ll take those up to our speakers here today and answer as many as we have time for. Finally, one last ground rule, all p_d_f_ of today’s presentation and the recording will be made available in the next few days to each of our attendees. OK, now with that said, let’s let’s Sheer level of information about our speakers today and establish your credibility.
[00:02:51] Paul Noble, founder and CEO of Verusen, an innovator in materials, inventory and data management. In fact, Paul has extensive experience in Supply chain manufacturing, as well as the successful application of cloud based a-r technology in a wide range of environments. Prior to founding Verusen, he spent over a decade with the Chairman Sherwin Williams Company, where he led its eastern U.S. industrial distribution business unit. Paul is also a founding member of the Business Accelerator Launch House based in Cleveland, Ohio. He graduated Kumari with a bachelor’s degree in management and marketing from Lincoln Memorial University in Harrogate, Tennessee. Paul, good afternoon. How you doing? Good afternoon. Doing well. Great to have you here. And you’re joined by Eric Greene practice lead within IX Center’s North American Industrial and MRO practice. Eric brings over 19 years of experience in procurement and supply chain management expertise. Prior to joining Accenture, Eric spent six years in the automotive industry as a corporate MRO materials manager. Also three years as an operations manager for Integrated Supply Solutions Company. Throughout Eric’s entire professional career, he’s worked with leadership teams, procurement, finance operations, Technical groups even to deliver proven results while driving out cost within MRO. So with all that said, you’re in for a great treat here today. Please join me in welcoming Paul Knobel and Eric Greene. Good afternoon.
[00:04:25] Good afternoon. Good afternoon. Thanks, Scott and Greg. And of course, Eric for joining us here. It’s a pleasure in Supply chain City, Atlanta. George Prest. Right. And I’m really excited about the conversation. I think every time Eric and I get together and obviously Greg and Scott, we’ve done this several times as well. Always enjoy our conversations. We sure get get deep and get his material management, his face. We’re going to have to control ourselves here of Jerai 30 minutes. But really what we want. You want to go over and from a or a loose agenda standpoint is start looking at some of the key challenges from the systems and process perspective that are facing large asset intensive manufacturing companies or asset intensive businesses and some new ways to tackle decades old problems.
[00:05:21] Know I think both of us have kind of been living and breathing materials management and MRO for last decade or more or more. And and just over a decade.
[00:05:35] And I think it’s it is a big complex problems. They are a problem. And I think that there are some kind of key things that can help our audience better attack and Sheer build a strategy for 2020.
[00:05:53] Yeah, definitely. I think it’s gonna be a fascinating conversation. You know, up on the screen, we kind of have some challenges that probably many of you are familiar with or experiencing on a day to day basis. And, you know, I like the word trapped, right. So there is a lot of value out there, not just from a procurement standpoint, but also an operations within the asset itself or sitting in systems. And in many cases, you just don’t have the capability to do it yourself or you have these ideas and these concepts and you have loose constructs to work with. And ultimately you have all this pressure to drive out cost and reduce inventories and do other things within operations that really show the value to, you know, stakeholders in the groups that you represent. So, you know, Accenture, we pride ourselves in having that deep knowledge and expertise to help companies kind of grow their business and capabilities quickly, be very agile and efficient and how we’re going through, you know, the performance of those type of programs. So really speeding them up or getting them caught up to speed. I’m sure many of you maybe realize that, ma’am. I feel a little behind the times and many companies are having spend visibility and they’re able to kind of dove into things, but then they don’t really see that return on investment.
[00:07:14] They’re like, well, I think I can see something. I think there’s an opportunity. But ultimately they’re still struggling to kind of react to what they’re seeing on, you know. And I screen say, so, you know, it’s all about the customer experience. If a customer can truly keep it simple. Right. Think of Amazon. Right. That’s a good one. They really have adopted, you know, a click one time and you can get something. So, of course, in our world, people are looking at us from leadership and say, can’t you give me a name, Amazon like experience? Can’t you help me find a quick way to drive out cost or allow enable somebody to shop for something? So, you know, Accenture has been priding itself to have the technologies and capabilities and, you know, working with companies like VeriSign and others to make those solutions real for the clients, because that’s really that’s really what it boils down to. How can we enable and drive some better outcomes for for our client base?
[00:08:13] Yeah, I think then to that point, when we’re having conversations with Supply chain leaders, you’re always. You know, there’s this traditional way of solving these problems, right? It’s very manual, very labor intensive. There’s a lot of and we’ll go into some details about it. But system related problems, things that they generally know what they want. Sure. Out of these, you know, out of their systems, they know what they want to do with operations, but they have limitations around scale and and. Yeah, resources, technology and resource. Yes, sure. And so, you know, from you know, as we look at this gap and I think that that’s why this conversation was so interesting, is you guys really tackled it from a procurement side of things. Very well. Category management, how do we buy? How are we getting best pricing and rolling that out across a complex global organization? It’s difficult. And and we’re always looking at, you know, how do you inventory and how does it operate? How does this affect operations? And there’s always this. And we’ll talk a little bit more about it. There’s always this big gap there. Yeah. And of misaligned incentives, even though everyone’s trying to do the same thing, produce more product, gets to your customers, hit high service levels, all those things. And that’s really what you should be thinking about as your tackling these issues are what do I want out of my data? What do I want out of inventory? What do I want out of any of these big projects and ratings that you’re looking at? What’s going to drive business value and drive business value fast? Right.
[00:10:04] Yeah, it’s definitely been an interesting challenge. Right. So there’s procurement has sometimes not had the seat at the table. Right. And that’s because they have limited visibility to the data that they have exposure to. They might have the purchasing or the buy side, but they don’t really know how much is in inventory. They don’t know the suppliers that are contributing to that inventory. So it really becomes this ecosystem that you can start to breakdown some of those barriers. And, you know, now is the time to act. Right. Clearly, there is this opportunity for leaders recognizing that there’s this inherent need. They know that they need to innovate. They know that know in our surveys that we’ve conducted, there’s over 90 percent that say, hey, we need to innovate. We know it’s the right thing to do. We know in order to be a high performer achiever, we got to do it. However, the Handspring Hair is 20 percent are really ready to do it. And really actually tackle it and get to that point where they’re actually having a legitimate engine that actually drives that innovation. So they might have pockets of people, maybe systems, but everything’s still disconnected.
[00:11:17] So the technology’s out there in these worlds and in Sheer environments, but they’re not talking to one another. They’re not really inherently together. You know, one out of three, you know, when you start to really look at those companies, they start to ramp up these innovation engines and really drive it. But yet it’s really just about 50 percent that’s actually being contributed to it. When you start to even break it down even further, you know, they’re still underperforming their peers in some of these industries and maybe some of the folks that are here, you know, maybe you feel a little bit behind the eight ball as well. Or maybe you’re looking at your competitors and saying, wow, they’re really doing this or they’re doing that and we’re not even there yet. So, you know, Accenture and Verusen and other groups out there were really trying to bring things together to really drive that value and really realize that investment, it’s there people are investing millions and millions of dollars in data cleansing and going after other types of inventory optimization. And a lot of times it just boils down to the subject to be a person.
[00:12:22] You look at something that we’ve really been seeing us that supply chain now we’ve been talking a lot about it and we hear it every day from leadership that, you know, Supply chain is becoming specifically a competitive advantage and opportunity for organizations. It’s no longer just Backpage UPS and try to manage it as much as possible. You know, it’s not all about druck materials anymore. Right. Right. There’s this untapped potential from an indirect supply’s perspective for. And then the you mentioned Amazon earlier, but the consumerization of the enterprise solutions I think is really important. It’s the expectation of how can I be, you know, remove all of these complexities, look at millions and millions of data points that are changing daily and how can I make simple decisions that can make my business better? And how can I do that near real time or real time as my systems allow me to do it because business changes every day.
[00:13:30] So you’re looking at this once a quarter, once a year, looking at data every five years and knowing your handcuffed by it isn’t sufficient for running a, you know, innovative and excellent operation. And what we’re seeing, you know, I’m sure you all are seeing the same thing are leadership no longer is accepting that. As as a part of that end to end supply chain Sheer affirmation.
[00:14:02] Yeah. Even the mode. I mean, everybody has a mobile device, right? That is a smartphone, right. That everybody wants something at their fingertips and that visibility and taking that visibility into either the source to pay side of things. Insights driven, being able to make decisions on the fly. You know, you could be flying somewhere and you can make those decisions while you’re on a plane, wherever. So really that you have to create this environment for people to innovate. And what better way to do it from a mobile device or some other way through an iPad? It’s not just sitting down at a screen in a manufacturing planet. It’s truly become a global opportunity for us to capitalize on.
[00:14:43] Yeah. And you know, what you’re seeing here on the screen right now, I think is a. Are there some major initiatives that organizations are looking at and wondering, where do we start? Hey, the time is now back to your point. Yeah, and it’s a brick by brick foundational strategy.
[00:15:04] It’s not anything that you can expect to happen right away. So we look at and always, you know, kind of set there. However, you traditionally attacked these types of initiatives. What has stifled your visibility? How can you lay the groundwork for a digital supply chain and digital goods strategy? And more importantly, you have to be predictive. Right. And technology is going to help you get there. You’re going to need to know not only your consumers needs, but the needs of the organization before things happen. And so as we look at it, you know, there are some key things that stifle visibility. You know, as we talked about earlier. System limitations. Right. And the traditional solution for visibility is let’s dump it in a data lake. Let’s dump it in a data ocean, dump it in whatever body of water that you feel is what you want to tag it with. But you’re still in as organizations grow through M&A activity and such. You’re just stacking your you’re stacking legacy system data. You’re not understanding it better in a data cleanse is the first step of that isn’t going to do anything to slow you down. So if speed if you know, time is the automate estimate, too.
[00:16:23] I mean, you’re talking millions of dollars of time, resource intensive activities. And in some cases, people are still left with a poor process at the end of this. So, you know, they’ve done all this cleansing work only to find out by the time they’re done, they got to re cleanse it all over again. I don’t really have that visibility that they truly want it now. So there really has to be this, you know, this A.I. engine or hind it to really help keep up with that process and make it sustainable.
[00:16:48] Yeah. And we would we always challenge individuals and supply chain leaders to look at what do you want out of data? Right. Then the answers that we always get are we want to be able to procure better. We would like to inventory more appropriately, act as an enterprise. We would like to make sure we’re hitting customer service levels. Know ninety five percent and above or that we’re remaining Six Sigma on the production side. Right. And that’s where I think that alignment. You can have both. All right. And it’s where we transition and it kind of goes into this digital perspective is that data is no longer a project. It’s a living, breathing thing. You know, as so as you look at strategies, you need to look at strategies that are going to drive high value, low effort and low risk. Sure. For the organization and be building towards, you know, everyone’s striving for industry X or 4.0. Yeah. And if you’re not laying the groundwork now, you’re not taking into account decisions. It’s going to make your road and path, you know, a high risk for failure. Sure.
[00:18:07] And just to kind of talk about the visibility piece is five to seven years ago, most organizations were just starting to get, you know, some sort of visit visibility software. Right. Really? You know, if you click Product Act or Tableau or, you know, power beyond whatever is out there and, you know, very few companies would really have those at their fingertips and employ those. Now, I’m seeing those to be almost a given. Everybody has some form of visibility, but their processes are still cumbersome to get the data in there or it’s siloed right there. That’s only sitting with a specific group. And you still have to go to that one group where that data, it’s not easily accessible. And that’s really digitization is really empowering. People to innovate is giving them access to that data at any point in time. Right. And allowing them to interact with that data in train the system as in and train the A.I. and leverage what’s in their minds and their brains to really create those predictions. And that’s kind of the engines that are being worked on. Accenture, I think Verusen also as well is really working on those predictive levers to really draw from because without those. Yeah, that that’s it. That is the future. That is what people are asking for today. I’m sure many of you on the call are saying, well, how can I predict the price of this or how can I predict, you know, how much inventory less I need or more I need? It’s not always about less. Sometimes you need to right size things as well.
[00:19:34] What’s going to build my trust and then hitting and hitting, you know, my business goals and now. Being predictive is such an important part of that. First, you need to know what decisions you’re making collectively. I mean, you’re looking at organizations from ten thousand one hundred thousand people making decisions every day in isolation. Right. Yes. Correct.
[00:20:01] And regionally. Right. So some of you may be in a U.S. region or maybe over an A or somewhere. And a lot of times you’re still disconnected. You’re even though you have these tools and these systems, you’re still in a siloed process. And maybe what’s being really a best in class approach in one region is not necessarily shared in another. So, you know, breaking down those walls and connecting those chains together is is very vital to really drive those success factors.
[00:20:31] Yeah. And that’s when we talk about silos. It’s silos within an organization as you innovate. You could potentially be creating more silos. But the interesting thing that we’re seeing and something that we’re working towards from this intelligent, connected, supply chain vision of ours is the opportunity. For. You to leverage the data that’s in your Supply chain network as well. Right. So, yes, it’s all sometimes about getting getting it right and inside your own four walls. Right. Getting your own house. Right. But then how can you break down the silos of your supply chain and be able to work together more collaboratively with key partners and key suppliers where there’s mutual value on both sides? Yes. You know, I think. Again, what you do today is setting the table for that. As technologies and system should provide for that opportunity, and that’s what really excites. And it’s something that we’re obsessed with and passion about in our team and in the partners we’re working with. You know, really setting with the Sheer.
[00:21:38] And, you know, I think what you’re describing, Paul, is is something that has been in existence on the durang materials side for years. Right. Companies are connected with, you know, their materials planning organization. They’re already tied in to just-in-time delivery. So they’re delivering those things to straight to the line. And then the redheaded stepchild of the group is the indirect materials side. Right. They’re going to left with whatever is available. And it’s really subjective. And the beauty of the A.I. tools and technologies that are out there that are being built by Accenture, VeriSign and others, really it is started to really break down some most barriers in our world. And and things that we’ve thought about doing for years and now are starting to actually become real intangible and getting that operational team, that picture. I like the slide to where it says procurement like it. It says it’s at the center. Right. We always consider ourselves like the hub moving right. We hopefully have a seat at all these tables. Operationally, reliability teams, even finance. But the truth of the matter is, is a lot of times we cannot be very forthcoming with information because we just don’t have the data or we don’t have the knowledge and insight to be, you know, have a seat at that table. So a lot of things are being built today to enable those to say, hey, you know what? If you did it this way and here, by the way, here’s how you historically bought it. And here’s what we feel the predictive price would be. Maybe we should look at by this way now and maybe we should stock it this way. And by the way, you know, if you have the tools and the A.I. engines establish and set up an ecosystem to support it, now you’re truly making decisions that are not just what has happened, you know, past tense, but you’re also impacting the future models as well.
[00:23:24] Yeah, you can’t can’t be looking back always and being reactive. And I think that’s where most even our listeners today.
[00:23:33] That’s probably where a lot of people are. I mean, I would say they’re looking at it from a rearview mirror perspective. They want to have that forward look, but they just don’t know how to get there to the next ring of that ladder or bring those ideas. You know, many, many of you know, I’m not sure if you’re CPO or that your role is, but you may not have that empowerment, but come into technology and fairs and listen to P&G has like these really should help you kind of be that innovator for your company to make those, you know, and to procure metro materials management, whomever you support.
[00:24:06] So it’s very much I agree. And it’s very much a systems element. Data element. Right. How do you process things around it? It’s always been always been the solution to process your way around it. But there’s a big human element to this as well. As you talk about this gap between procurement and ops and then obviously how that drives the financial implications and for an organization from a revenue perspective and a operational expense control perspective. There’s a way you can kind of have both. It’s been a weird, a great, you know, kind of weirdly inventory and matear of this like emotional pull to them Ryder. People get very emotional about because they they haven’t had the data to support a lot of their decisions. So, you know, I feel more reliable if I stock more subjectively. Right. And so you’re telling me as a procurement person to stock less or offload more working capital. I’m going to push back. Right. But there I think there is this human element we’re seeing in and developing for that allows you to achieve both. You know, I can. I can have a voice, I can share my knowledge around what we what I feel we need rather than just looking at history to dictate, put a result. Yeah. You know, abortion, which could increase risk. Right. So I think that’s that’s something that we’re looking at. I think with the dynamic between global operations and these these different typically siloed parts of the organization, a way to allow them to achieve both. Bridge these gaps and work together.
[00:25:56] Yeah. I think what’s interesting, too, is, you know, procurement is there can be a revolving door in procurement just as well as other groups within the business, and they don’t necessarily have a sustained system or process established. So if you or I were to replace another person coming in, you’re kind of starting over. And it’s really up to that person in their mind as to how they want to go through that next stage or strategy or whatever they’re trying to achieve. So really having a solid A.I. system that starts with maybe one or two people, but it’s personal to your point, right? You’re taking what’s in that person’s mind and you’re running it through a technology engine to really help them. And then ultimately, if they’ve changed that job role, that’s still retained, still retain that knowledge, which is pretty powerful, that most organizations lose if somebody leaves a company or organization there, that there’s an interesting thing that we see that probably.
[00:26:57] You know, maybe 10 to 15 percent of the data that goes into making decisions lives in a system, yet the systems are always driving. The driving, the levels and the way those decisions are made. Right. So I think that’s one the knowledge transfer aspect of how can an organization across business units, across plants and with their supply chain partners transfer important knowledge to the system that makes everyone better and makes everyone more comfortable and sustainable? This trust that builds trust. Yes. It improves sustainability and improves, you know, where you’re going to get to that optimal point. And that’s where everyone wants to be. But it’s just this rise and fall of where you’re at achieving at these cycles that everyone kind of continues to go into.
[00:27:54] Yeah. And, you know, over the past, probably six to eight months, I’ve had the privilege to work with several different companies specific to inventory optimization. And, you know, the number one thing they want to do is reduce, reduce, reduce. And what we find is we try to say to them, OK, well, yes, you can fix some of these other problems and challenges, but what if I can stop? The U.P.S. Rod shipments. What if I can stop some of the hot shot deliveries? And you know, that requires you to invest a little bit more in your inventory. Oh, well, I don’t have the floor space to do that. OK, well, then I’m telling you and I’m predicting that you’re gonna predict a failure. Right. There’s gonna be a failure. So in many people know this in their mind. They know they are not stocking enough is something they just don’t know how much to stock or carry or what the case may be. So that’s the beauty of like the A.I. technologies. Is it really gives you those values and numbers. You does the math for you. And then it allows you to say, yes. No, this was good. This is good. This is bad.
[00:28:59] Right. So it’s a continuous evolution. And a lot of things that you have up on the screen here, you know, the the. Starts with data. Right. You know, poor naming categorization. That’s notorious in procurement. You know, I call it a hammer and you call it a tool. It was just two different schools of thought. But you start to put those in engines and you can normalize things. And how I want to see it versus how you want to see it. It really becomes irrelevant. And it still drives that value. We’re looking for. So, you know, multiple data sources. That’s probably, you know, CPG clients are notorious for this. You CPG folks out there. But M&A is a is a huge play in those spaces. You know, companies and baking and food and bed. Same thing. We’re finding that, you know, they have good processes and systems. They’re driving a digital strategy, but they’re still lacking on some of these areas that you have up on the screen. Right. So they don’t necessarily have that common system or common capabilities. So these A.I. engines that are being built by Accenture and and VeriSign and others clearly are driving better business outcomes.
[00:30:05] Yeah. It’s a good.
[00:30:07] If I could weigh in real quick. So our audience, clearly we’re getting some momentum here. We’re getting some buzz. We already have three or four questions submitted. So want to remind our audience for folks may have additional questions you can use to chat toolbar. We’ll take those questions and hold those two until the end of the webinar and we’ll post those to Paul and Eric as we have Tom. So clearly I’ll keep it up. We’re driving some summer, some tough questions.
[00:30:31] So these are important times affecting affecting organizations small and large. And then to kind of piggyback of what you were talking about, our. There is this traditional way of going about things, right? And it’s very much a process. We always call it kind of the Frankenstein that’s been built between systems and processes over the years Ryder and an accounting practices to try to manage it better. Right. And I think that there’s. The way we kind of go about, you know, driving towards what do you want out of your systems and your data and your processes as a starting point. So this is almost a challenge to the audience. And in those out there that will hear this virally as it as it spreads is. Think of a new way of attacking things, right, just to cleanse data, to hope that the things that you want out of that data happen seems a bit backwards. Right. And. What you’re what you want to do is understand enough of out of the data across those systems to be able to immediately be testing hypothesis a hypothesis. Sigh and really drive and really drive. Towards those goals, right Sheer and know what’s working and what’s not. And so that’s where we we talk about really creating this living, breathing, self cleansing mechanism. How can you how can you get there? And that’s a bit of, you know, what we’re developing from an artificial intelligence standpoint is structuring information appropriately to know how to streamline that and where to lean on your supply chain partners. That mission. It shouldn’t be your job as an organization to go externally and harness. They and have to clean your Sciarrotta when all that data you want is living in your supply chain, right? Yeah.
[00:32:47] So synopses is a good kind of segway to this. So, you know, at Accenture we can we have this engine, right. And there’s really four tenants. There’s that human element that we we have that excellence. And we had those folks that are deep experts. However, now coupling that with an A.I. engine creates that empowerment and enables people to quickly tap into something, workflow, orchestration. So many times there’s all these disparate systems. There’s just no workflow management based on a project manager, whoever, whatever system they like, you know, and then you have your insights and intelligence in many companies. That’s one of the lacking areas that they have. So, you know, essentially we have over like 70 different applications that are readily available in San UPS that you can draw from right on the onset of a program. And then it’s regardless of what kind of data you have right there is these data lakes, if you want to call them, as well as just all kinds of ways that it could be supplier data be, you know, different types and forms of data. But ultimately, to your point, Paul, it’s driving business outcomes, right? How can we drive more savings? How can we have more of a touchless process in our P2P type cycle? You know, compliance, that’s huge. You know, within our world, you know, they spend a year sourcing something and then nobody really uses it only to find out that, you know, you never updated your inventory records so that the product went to the right vendor. But also also to your point, I think. Paul, we kind of talked to this prior to this call here is really how can we involve the supply base and and the partners that we develop with and really create that ecosystem so that now they have access to those systems that we have access. So it creates this one, you know, centralized, living, breathing kind of brain. Yeah.
[00:34:42] For an organization that’s important in its inventory better.
[00:34:47] And I know understand what I need to inventory and I trust that so I can buy better so I can inventory a better site.
[00:34:53] And that is it does work here and then and. Is is achievable. One quick, quick point on the reduction and savings aspect of it, right. So these processes and materials have been difficult to manage over the years. So reduction is an a byproduct. Right. Sure. How do you look at data? What are the byproducts that you’re feeding off of that reduction? Is the immediate R-N.Y. Mm hmm. But you don’t want that to bloat back. Right. So as we look at the right strategies from an inventory perspective and then working with procurement strategies, yes, it’s about reduction to get to that trusted balance. But it’s as quickly as we can stop the bleeding, so to speak, of over procurement. The faster you’re going to work towards that. So it’s almost like waves and then that takes you and moves you ahead and gives you more information to go. And I know we’ve been kind of dropping dropping a high throughout this. And, you know, it’s a key part of our business and I know yours as well. And we see it as the future of truly solving some of these age-old problems within Supply chain. And there’s not A.I. for A.I. sake. This is A.I. for driving business value. And that’s why we kind of put it, you know, we’re talking business here and we’ve kind of put this later in the discussion towards the end. There’s three things that I I look at that A.I. does for organizations. It enables speed that drives scale and improves accuracy. All right. So if you’re looking at what is A.I. do for us, I would I would venture to say those are probably the three key buckets that where it’s going to improve things, you know, you want to do. It will help you do them faster. It’ll help you do them more accurately. And it will help you actually learn from best practices and scale them in areas that you may not be able to do. So yeah.
[00:37:07] Otherwise, yeah, I’ve seen that notoriously two companies will immediately want to do something to drive that business outcome. But then they they don’t reinvest that savings or that value back into these type of hands that you’re talking about.
[00:37:24] Horwitz This division is so good at this, but we can’t we can’t replicate that across because we can’t wish we could have 10 of this individual or whatever it is. All right. And that’s not gonna happen. Georgia Tech’s fairly working on something, but Sheer. Yeah. What you want to be able to do is to allow your systems and your team to do that, act as an enterprise and be able to truly do that is on the horizon. So we’re going to work. We’ve been enjoying the conversation and probably getting ahead of ourselves in terms of what we’ve been staying behind, in terms of clicking through here, but really all of these principles is about acting now. Laying this foundation, building trust and really looking at what are your goals as an organization. As we talk about as technologies like additive manufacturing and IO T and blockchain, right. Our values are these are whole other topics. Right. We could talked, but what you’re doing today now from a data perspective and really the building blocks you’re setting today lead you here tomorrow to make sure that this can actually execute, you can actually execute and begin piloting these types of initiatives with sister parts of your organization and make sure that the dots are connected.
[00:38:54] Yeah, yeah, definitely. These are these are some big tenants that you flashed up on the screen there. They are common. You know, I’m sure many of the listeners here are actually have pondered those or maybe Charles doesn’t those. Yeah.
[00:39:09] So 3D printed parts. Oh, come on. It’s there. It is Sheer. Are we ready to move in the Q&A? Yeah, I think so. Yes. You shared a lot to really appreciate y’all’s approach there. You shared so much. I think a lot of folks can take and use a practical feedback and ideas to to start thinking definitely maybe about their organization, their operation, what have you or even certain processes. Right. Sure. Before we’ve got some great question to that. Before we do, Greg, why wants you to weigh in? I think you had something you want to add or maybe start with a question or.
[00:39:44] I think there were. There were a number of things that were very poignant in this discussion and the one that kind of jumps out at me that I think should help cement. What I can do in people’s minds is it learns quick, right? It never forgets. It never fails to retain the information. It can access the data. You know, and it never applies emotion.
[00:40:12] If you think about it, it’s a human without all the human frailties that keep us from being able to do this. Well, it’s really good for us. Yeah. I mean, it’s a human noting the data in and taking those expertise and knowledge base to create that model. That’s a statement that I particularly like. You know, I come from an industry not dissimilar to this. It’s usually the strategic or retail inventory side. But the same issues that you’ve discussed here occur in that industry. And one of the tenants that we always applied was informed the system of your knowledge. The system will retain that knowledge and it will act or guide or provide insights as if it were you. Yes. Right. And but again, without those human frailty. So I think that’s a really, really important. There’s a that’s a part of what you guys discussed here.
[00:41:03] Call it an assistant, call what you will. But it’s this ability to plug in and give an enhancement to what you’re doing today and lead you to tomorrow. Yeah. Yeah. Yeah. Okay.
[00:41:14] So with our global audience, I want to pose a couple these questions we’ve gotten and I will start with one of with a question from Mike here. So Mike initially posed a question to Paul and Eric, hey, where does sales fit? And then I said, hey, great question, but let me get a lot more elaboration on this. And Mike added, It seems like they’re focused on the three streams of ops, procurement and finance. But Mike says sales drives so much of the data and the overall confidence for procurement to make right decisions. So it seems as if it should be in the end. I’d love to get John to weigh in on that, for starters. And thanks, Mike, for the question.
[00:41:55] It definitely is. Anything opinion on that is. SALES is a signal to drive many of the others, right? And so you look at once you can lay this appropriate foundation, you have things on the back page working well from between ops and procurement. And what do you do? You want to take those signals and a sales is obviously it’s a driver. When you’re talking interact and maintenance less of more towards, you know, the direct side and how many how much finished goods should I have? Right. From an inventory perspective, we typically start from an indirect perspective by design is a little less risky and allows you to build trust and lay this blueprint that you can take up the nodes to direct the finished goods. And as you go up those nodes, sales plays an even more important of a driver. And then being able to add those different signals and as you know, it’s that sales, it’s whether it’s all sorts of different things that can affect a global operation. It certainly has an impact back down as well. But it’s being able to again, apply that appropriately to the equation.
[00:43:12] It’s critical preemptive an indicator. Right. I mean, sales is the front line of the company. Right. So it it needs retranslated as you’d convert it into as you’re talking about into these types of products. But it’s certainly a preemptive indicator.
[00:43:29] And it should be and I would I would imagine is is often included.
[00:43:33] You know, there’s a lot of effort to make that as predictive as possible, obviously, outside of a gut forecast track. So, you know, it all works.
[00:43:42] I’d never put together a forecast or error. So weigh your take on Mike’s question here.
[00:43:49] So I have an indirect spend perspective when I’m I’m speaking to this topic and how it applies. So I have more of a limited point of view when it comes from a sales perspective. But I wanted to comment on when you talked about the weather and things of that nature. You know, I never release it was still I stepped into like oil and gas and even some of the southern regions. Did they really start looking at like hurricane preparation and those type of factors? And I have seen some a-I engines out there that have been built around that predictability, like what they should be stocking in that region, ramping up, ramping down on those supplies and material. So it’s not necessarily a sales, but it is in a. So you may have to demand that demand. And so, you know, there there’s many different ways, I guess we can kind of tackle this. But like I said, it’s the indirect side that I’m focusing my my time and attention on. But sales definitely drives from a direct materials it as it is as demand.
[00:44:50] I think it also applies with indirect and it’s often overlooked. Right. And you’re focusing you’re being reactive. You’re focusing. You can’t focus on those things as much as. All right. What is the demand of my organization as I would stock finished goods in certain area during certain times or certain seasons? Where should I be stocking the same things to make sure that I have what I need, when I need it, where I need it to support the demand and sales so production stays up. Those areas that need it most and that it can get there as quickly as possible.
[00:45:25] So I would say that it does tie back because it they’re all there. It’s an order of the production process. Your sales. Yes. So, again, it’s all circular. Yeah. Excellent, Mike.
[00:45:42] Great question. Open up Q&A. Appreciate that. Appreciate you joining us. Next question comes from Greg, not Greg White, but another Greg W.. I’ll send the question. Greg asks, How does a-r interface with ERP systems to better inventory visibility? And then a follow up question to that is how about a demand planning slash digital supply chain planning solution? So start with the first one. Interfacing with ERP systems.
[00:46:14] Yeah, so speaking of experience of what we’ve built, you know, what you are looking at are the relevant pieces of data that can go in and understand data that exists. Correlate that with the relative information. So if you’re talking indirect, it’s go in. Understand material catalogs and tables that that live in each of the frankenstein. systems. Right. So multiple europeans’, multiple instances. V.I.P.s, understand what’s there. Look at how that how those specific, specific materials move throughout the global supply chain historically and present. Individuals, whether it’s planners, the data managers, plant personnel with opportunities to make decisions and take out all of the manual processes, all of the heavy lifting that usually is there, right. It can be that assistance we have in our platform to multiple models working together to both structure and understand data, look across systems and then display that from a here’s your most pressing inventory need per plant across the enterprise, improve visibility. So I don’t know, Eric, if you have anything to add to that, but that’s how I see it. You know, interfacing with those systems at Sheer, you know, kind of connecting the dots and removing all of the analysis and present to get to the to the human to make a decision. Right.
[00:47:51] You hit it on the word movement. So looking at ERP moving, you know, I say he has a ton of data points, could be reliable, Ryder liability data. Ya know, e.m type material, master type records. It could be. You know, you got to remember that this is a daily, hourly living, breathing cycle. This is constant. This isn’t like a one and done scenario that we’re describing here. It’s a constant evolution. And it does take time to teach, learn, you know, mold this system. So to say. But it’s just a constant flow. So there has to be this clear interaction from an ERP perspective that’s constantly feeding that engine. So there’s all these connectors that are built from a technology platform standpoint to enable that system. And then, you know, the learning is the human aspect. And you’re teaching it, you’re accepting it, you’re declining it, and it learns those habits and those behaviors. So the data can become a better, you know, model for you to follow, because, you know, I think like oil and gas or they have turnarounds. Right. They have a thank you cycle where they ramp up and then they have a ramp down period. So, you know, the system will learn those cycles and it’ll be able to say, hey, you know, you’ve got a turnaround coming up early and we need to ramp up these type of materials. So it really starts to kind of create those engines that everybody’s dreamed about, wanted, but it’s been living in somebodys mind and they retired 10 years ago. So, yeah. So, you know, that’s that’s another element of this as well.
[00:49:20] I think relative to the demand planning aspect question portion of Greg’s question, I think specific to what Verusen does, if I understand it correctly, you you can identify substitutes and duplicates or alternatives in the environment in the demand planning tool and say it’s OK to use this instead of that. If you don’t have this or you have too much of this combined product and you only need one. Right. And I think those are some of the some of the really valuable aspects of it from a demand planning standpoint is it identifies what’s available, whether it’s duplicate, whether it’s it’s able to be substituted. Things like that are tremendously valuable when you’re going through that. And it also helps you to intelligently manage and even reduce reduction. Is your goal, as you guys talked about earlier, it allows you to to to effectively do that.
[00:50:21] And it doesn’t tell you what to do. It suggests what to do. It’s right here and gives you all the information you would ever want about that. That drives in the system that you can add to it.
[00:50:33] And just to kind of build on this, too, because I don’t think we brosseau’s topic of excess and obsolete. A lot of companies. I’m sure that the viewers here kind of living and breathing out, gosh, I have a I know I have all this excess, but guess what? I can’t get rid of it because I have it’s a what if. So really empowering, you know, to have this data point and say, oh, well, it hasn’t been used, by the way, because the A.I.D. Knows the assets and the equipment that’s on there. It can clearly say if this doesn’t even live in yours, live in your asset, in your Plint production facility anymore. But guess guess what? In China, it’s over in China. So ship all this product over to China. So now you’re starting to right size your inventories and get reading and burn down some of those inventories that maybe it’s just been there for years allows.
[00:51:20] And that answer will probably make Greg really happy.
[00:51:24] Makes me happy because I am Ryder from that perspective. There’s also a lot of to that. Again, piggyback on that. Something that we’re seeing and tackling is there’s a lot of especially an indirect and probably mostly in indirect on materialized data and purchases. Free tax, tax, tax. OK.
[00:51:44] So I need something and I’m going to just I can’t get to it because it’s too complex to get through my system or go to my punch out, whatever. I’m just going to type and I need a hammer and 16-ounce and off it goes.
[00:51:55] Yeah. So it’s unstructured. It’s really difficult to search and find the material that already exists because the name naming conventions are terrible and or you can’t get access to that other system that it may live in. All right. So and ascended descended to MTM to actually put a material in the system is can take potentially days. But I need it now. So I just order it and then it never gets it all. And whatever I feel like in the moment, we can analyze it. And that’s something that they order it. They order it.
[00:52:27] But then the extra comes back to the store room here.
[00:52:29] Add this to my inventory added to my inventory. I can’t run analytics on it. I can’t it’s difficult to run, run, you know, procurement strategy or strategies around. And that’s why your inventory spike. So that can be anywhere from fifteen percent to 50 percent of purchases for causations, which is scary. Yes. Very secure. Lots of passion around this table here. I wasn’t expecting that answer. Well, this is this is why we was an answer.
[00:52:54] This is why we do it. An interaction from supply chain leaders, professionals globally. Yeah. You give all these folks in a room. Yeah, absolutely. So want to give a we have one last question from a dear friend of the show. We also have a shout out from Bilston, Cavic, Dennis Savanah. Yeah. So Bill teaches at Savannah Technical College and he regularly connects his students with the content that leaders, like everyone in this room are sharing and best practices and their thought leadership. So, Bill, quick shout out. You reconnect with you again soon. So the last question and we’re gonna make this with this answer, a succinct one. Real succinct. This comes from Natalie. And hello, Natalie. Happy New Year. How quick are companies embracing and technology to using it day to day?
[00:53:45] Well, so there’s a couple different paths, so. Well, we well, we’ve been working on is. Multiple art of official intelligence models that help a specific problem around materials. Traditionally, how companies have been looking at that, that allows you to plug it in very quickly and see results within as quickly as 90 days and get a more predictive path to your trusted optimal points. And that’s because we’ve generally productize that a lot of what organizations are going towards and traditionally why it’s been difficult to stay at scale is you can’t just develop a specific model for your specific need. Right. So we’re seeing a lot more productized as that solves some basic system related problems. And that’s what we’re tackling in the materials space and we see it other parts of the supply chain. And then the longer path is, hey, we can hire a a development firm that specializes in artificial intelligence to build us something specific to our business. And you’re looking at a timeline of maybe 12 to 24 months where you can actually get that implemented and and start to look at it from your organizations. But it’s really, really custom.
[00:55:11] And a quick interjection, Aiyaz, here now. Is it 7 around the corner? And I think there’s still a segment of the supply chain in the integrator business community that is still when I hear a lot of they’re thinking next year, next generation is we’re making huge strides, move the needle in meaningful ways today.
[00:55:29] Now you can do it down. Adopt it now. That’s right. Take advantage. Yeah. Yeah. Fair sourcing and procurement standpoint. But Accenture, you know, the cycle times for sourcing used to be, you know, six to 12 months for a strategic initiative. And, you know, from the processes that we’ve developed and using different tools and analytics, companies can plug immediately into those and in, you know, two to three months now or in some cases right away, you can go right to the negotiation table. So you can load in some parameters at the due diligence. No longer takes months. It takes hours. And I sit down with you. We review a contract review. Some spend, we bounce it off against some analytic tools. And by the end of the day, in that discussion, we’ve already created a strategic weight plan as to how we’re going to tackle. So I think from my perspective over the years, it has become very quickly adoptable and something you can implement right away. And then usually because of those successes, it leads into the other topics like inventory optimization. Well, what else can you do for me? It’s not just sourcing, right? Can you do other things? So there’s other engines that are being built and, you know, being adopted daily?
[00:56:38] Yeah, it’s hand-in-hand. And those traditional methods. You know, if it’s data cleansing, you know, twelve to 24 months, an RFP. It takes us nine weeks to pull all the data out there, to go out to click a button now.
[00:56:51] And it can tell you, you know, the 80/20 rule right now. There’s many engines that are out there that many of the clients that we work with have just completely empowered right from the onset of those programs.
[00:57:03] Well put. So thanks, Greg. And Mike and Natalie and Bill. And for some others, we couldn’t get a question. Thanks for tuning in. If you can get to yours on the next program. But that’s going to wrap up Q&A here today. Good stuff. Great show. Yes, it is tough to broach these topics that are that are impacting industry so deeply and meaningfully in an hour’s time. Both of you, I’ll come back for part two. Sounds great of that. Love to. So thanks for your perspective. They hear Paul and Eric and Greg. So let’s wrap up well, just a couple of final items, if we could hit that that next slide there. So to our audience, we’d invite you to join us at mutex 2020 in Atlanta. In March, we’re going be streaming live throughout the event on the show floor. If you haven’t ever been before, mutex is quite the spectacle and the great thirty five thousand of your closest friends and Supply chain. That’s right. Look, the largest supply chain trade show in North America is held in Atlanta every two years. Its sister, event pro-Mitt is held in Chicago every other year or two years. So you can learn more about the show at Motet show dot com. It’s free to attend. Can’t be that modest. Sherkin. MODEX. Sheer dot com. Now if you’re coming to mutex or maybe if you’re not going to mutex, we have some little something special for these folks on March 10th, right?
[00:58:24] Right now the Vetlanta Supply chain Awards. So that’s occurring around lunchtime on Tuesday the 10th. That’s right. So that’ll be that’ll be really interesting. A lot of supply chain companies here in Atlanta. And we’re either either based in or operating in. We’re going to honor their their excellence in the industry.
[00:58:44] Absolutely. And, you know, we’re gonna be featuring Christian Fisher, president and CEO of Georgia-Pacific as our keynote. Sharon Cooper as our emcee. Nomination’s and registration’s and technically sponsorships are all open. Although those are filling up quick in particular are thrusted nominations. So if you have if any of our listeners out there have operations in or around the 29 county metro Atlanta area, and think of a cross in the a manufacturing procurement, many warehousing fulfillment, retail technology, technology internation. Yeah, yeah. There is an award for you even if you’re a startup, which on all of us here can can relate to in some way, shape or form. There is an award for some of us more than others. Well, check out Atlanta Supply chain Award WSJ.com. If you can’t nominate. We always welcome you to attend. So looking forward to that. Atlanta Supply chain the wsj.com. OK, week. We will move to that last slide there on that note. We’d like to thank each of our attendees for joining us here today. Big thanks to Paul and Eric and their respective teams for presenting lots of good stuff today. Of course, high fived my co-host, Mr. Greg White on behalf of the entire Supply Chain Now Radio team. Scott Luton here concluding today’s episode and we hope to reconnect with you again soon. Have a great week, everybody.
Erik Green is the North American Materials & Equipment Practice Lead within Accenture Operations. His responsibilities include managing a cross-client Category Management team, the development and execution of category strategies and strategic sourcing initiatives; furthermore, designing and implementing supplier performance management programs, and generating value to clients using Lean practices focusing on Total Cost of Ownership. Erik is also responsible for the continued development of technology tools at Accenture, focusing on digitally enabling category management.
Erik brings over nineteen years of experience in procurement and supply chain management expertise. Ensuring the delivery of contractual commitments, processes, and effective customer relationship management. Before joining Accenture, Erik spent six years in the Automotive Industry as a Corporate MRO Materials Manager, and three years as an Operations Manager for an Integrated Supply solutions company. Throughout his professional career, Erik has worked with leadership teams, procurement, finance, operations, and technical groups to deliver proven results driving out costs within MRO.
Paul Noble is Founder and CEO of Verusen, a technology firm that uses AI to predict inventory and harmonize data organizations in a variety of industries. Verusen automatically integrates to your ERP and disparate data sources — single or multiple systems, one or many locations. Then, the platform’s Artificial Intelligence learns from your own inventory experts and encodes their knowledge to provide seamless inventory harmonization. With Verusen, you get automatic naming and categorization with 99% reliability at scale — a true material master. Paul’s passion for entrepreneurship has always shaped his approach for go-to-market strategies and tools, which was the driving force behind pursuing his dream of launching Verusen to improve the availability of easy-to-use technology for optimizing the supply chain for materials and MRO. Learn more about Verusen here: https://www.verusen.com/
Greg White serves as Principle & Host at Supply Chain Now Radio. Greg is a founder, CEO, board director and advisor in B2B technology with multiple successful exits. He recently joined Trefoil Advisory as a Partner to further their vision of stronger companies by delivering practical solutions to the highest-stakes challenges. Prior to Trefoil, Greg served as CEO at Curo, a field service management solution most notably used by Amazon to direct their fulfillment center deployment workforce. Greg is most known for founding Blue Ridge Solutions and served as President & CEO for the Gartner Magic Quadrant Leader of cloud-native supply chain applications that balance inventory with customer demand. Greg has also held leadership roles with Servigistics, and E3 Corporation, where he pioneered their cloud supply chain offering in 1998. In addition to his work at Supply Chain Now Radio and Trefoil, rapidly-growing companies leverage Greg as an independent board director and advisor for his experience building disruptive B2B technology and supply chain companies widely recognized as industry leaders. He’s an insightful visionary who helps companies rapidly align vision, team, market, messaging, product, and intellectual property to accelerate value creation. Greg guides founders, investors and leadership teams to create breakthroughs that gain market exposure and momentum, and increase company esteem and valuation. Learn more about Trefoil Advisory: www.trefoiladvisory.com
Scott W. Luton is the founder & CEO of Supply Chain Now Radio. He has worked extensively in the end-to-end Supply Chain industry for more than 15 years, appearing in publications such as The Wall Street Journal, Dice and Quality Progress Magazine. Scott was named a 2019 Pro to Know in Supply Chain by Supply & Demand Executive and a 2019 “Top 15 Supply Chain & Logistics Experts to Follow” by RateLinx. He founded the 2019 Atlanta Supply Chain Awards and also served on the 2018 Georgia Logistics Summit Executive Committee. He is a certified Lean Six Sigma Green Belt and holds the APICS Certified Supply Chain Professional (CSCP) credential. A Veteran of the United States Air Force, Scott volunteers on the Business Pillar for VETLANTA and has served on the boards for APICS Atlanta and the Georgia Manufacturing Alliance. He also serves as an advisor with TalentStream, a leading recruiting & staffing firm based in the Southeast. Follow Scott Luton on Twitter at @ScottWLuton and learn more about SCNR here: https://supplychainnow.com/
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