Raise the glass – to this week's article from MHD

Casella Family Brands has grown from a small family-owned business in 1969 to become Australia’s largest family-owned winery, based in Yenda NSW. The inception of the [yellow tail] label in 2001 propelled the business to new heights and it is now the most powerful Australian wine brand in the world. Twenty-seven per cent of bottled table wine exported from Australia is yellow tail, and it holds the record for the fastest growing imported wine in the United States’ market history. Today, Casella Family Brands ships over 12.5 million cases of wine to more than 50 countries around the world every year. Casella sources fruit from 37 of Australia’s 59 premium wine growing regions including Coonawarra, Wrattonbully, Padthaway, Barossa, Clare Valleys in SA and Mornington Peninsula. It has over 6,000 acres of vineyards, producing over 27 varieties.
Following a sustained period of rapid growth, including the acquisition of Peter Lehmann Wines, the company recognised a need to improve inventory visibility across its business, including two distribution centres. It also wanted to enhance its scalability to ensure it is set up for future growth. To fulfil these needs, Casella Family Brands engaged Manhattan Associates for a dedicated global distribution management and order fulfilment system.
Distribution manager at Casella Family Brands Sam McLeod said: “We have the fastest bottling line in the world, capable of processing 36,000 bottles an hour. Bottling at this speed and managing the volume of inventory associated with this scale of operation requires a strategic supply chain solution.”
The ongoing expansion of the [yellow tail] range and the integration of Peter Lehmann Wines led Casella Family Brands to look to Manhattan’s SCALE to address its demanding distribution management and supply chain execution challenges. Casella faced a number of supply chain challenges prior to integrating the solution, due to the fact that many of its warehouse processes were manual, time consuming and prone to human error.
Increasing warehouse efficiency and visibility
Casella Family Brands chose to implement the SCALE software in order to optimise order fulfilment processes across its various brands. By streamlining distribution and enabling ongoing business growth, the company was able to realise a number of key benefits:

  • Increased warehouse utilisation by 22 per cent.
  • Reduced labour costs.
  • Improved traceability throughout the supply chain.
  • Revolutionised planning whilst automating many of the associated processes.
  • Enabled the transition from a paper-based delivery system to a completely digital one.

Mr McLeod added: “Previously we were only able to track our stock by total production lot, for example in a run of 30,000 cases, we couldn’t distinguish the difference between the first and last pallet once the stock had shipped. With the introduction of Manhattan SCALE, we can now track stock to the pallet level due to the unique ‘license plate number’ (LPN) placed on every pallet prepared. In the event of a product recall this could save a significant amount of money.
“As a planning tool, SCALE is incredibly powerful,” he said. “We can now arrange as many as 300 shipping containers of stock in as little as half a day. This enables us to release orders for picking at the click of a button as opposed to manually keying in the contents, picking the location of each order and then manually updating once loaded, every day.
“All of our 750ml wine is produced in two different pallet heights. Manhattan SCALE allows us to quickly differentiate between these and if an imbalance is detected, we can produce the required pallet heights from our production line. Previously, these would have been manually restacked,” explained Mr McLeod.

Since implementing the program, Casella Family Brands has also worked closely with its export distributors to ensure they are ordering stock in optimum quantities (full pallets) to ensure it maximises the efficiencies the system provides.
Making an impact across the organisation
By working closely with Manhattan Associates’ consultants, Casella Family Brands was able to efficiently weave the solution into the fabric of the business, making the entire operation stronger. For example, the distribution teams (both export and domestic) were able to plan weekly loading into ‘waves,’ picking of all orders and the allocation of multiple SKU with differing pallet dimensions into containerised loads.

“We can now arrange as many as 300 shipping containers of stock in as little as half a day.”

The Planning and Inventory Team was also able to utilise SCALE for confirmation of production run quantities and obtain real-time status updates on production progress. The Production department now receives advance notification of incoming stock from the production line; and the Export Administration Team retrieves lot numbers for export orders for select customers. Additionally, with the combination of the unique LPN and lot numbers, the Compliance Team now has detailed traceability for audit and potential recall purposes.
“The combined effect of all these advancements enabled by the Manhattan technology has had a tremendously positive impact on our bottom line and has really set us up for future supply chain success. All of which has enabled us to focus on what we do best, producing industry-leading wines to share with the world,” said Mr McLeod.
Based on the success of its engagement with Manhattan Associates, Casella Family Brands is also looking to implement the system across its dry goods portfolio in the future.
For more information call +61 2 9454 5400, email info@manh.com or visit www.manh.com/en-au.
 
 

Hays releases 2018 Jobs In Demand report

Recruiting firm Hays has released its latest Jobs In Demand report, covering January to June 2018.
The company expects strong demand to continue in the logistics industry for persons with expertise in the areas of inventory management, import/export, wharves and fast-moving consumer goods (FMCG) planning.
“Across Australia, positive productivity is linked to efficiency improvements, be that in warehousing, transport or supply chain,” the company said. “Companies are targeting candidates who have a strong knowledge of systems and processes, combined with a proven track record in reducing costs and achieving demanding KPIs [key performance indicators].”
The report identified several roles that the industry is currently keen to fill, including storepersons with inventory management software experience, import/export coordinators with cargo software knowledge, fleet controllers with wharf experience, demand and supply planners with FMCG experience.
Experience in purchasing will also be in demand, as will candidates with knowledge of inventory management software such as enterprise resource planning (ERP) and SAP software.
Hays is also seeing an increased need for logistics candidates with heavy rigid or heavy combination licences.

Outdoor group accelerates omnichannel expansion

Fenix Outdoor Group, a subsidiary of Switzerland-based outdoor goods specialist Fenix Outdoor International AG, has boosted its international, omnichannel growth strategy. Fenix Outdoor Group will standardise its order fulfilment on the Manhattan SCALE system with initial deployments in its distributions centres in the US and Germany, followed by the Netherlands, Norway, China and Australia.
Fenix Outdoor Group develops and markets high-quality, low-weight equipment and clothing for outdoor activities under its Fjällräven, Tierra, Primus, Hanwag and Brunton brands, and sells through a combination of its own stores, retail partner stores and a growing online operation. The company’s major markets include North America, Germany and the Nordics as well as Australia.
Established in the 1950s, Fenix Outdoor has grown organically and through a series of acquisitions. Its 2015 purchase of Globetrotter, a German retail group, transformed the company from a predominantly wholesale-oriented business to a multi-channel commerce operator. The multiple, disparate systems it had inherited over the years were, however, hindering its further development. Fenix Outdoor therefore opted for a new warehouse and distribution management system to optimise its expanded business operation and to support its broader international and omnichannel growth ambitions.
Global supply chain director at Fenix Outdoor Group Marcel Gerrits commented: “With today’s consumers requiring exceptional shopping service, we are building our capabilities to provide a ‘best in class’ omnichannel one – offering our customers the goods they want, whenever and wherever they want them. We selected Manhattan as our chosen partner and its SCALE system that allows us to serve multiple channels from a single inventory pool. It also has on-the-ground support teams in all the geographies where we will deploy.”
 

SCM market to hit $13bn

The supply chain management (SCM) market will exceed $13 billion in total software revenue by the end of 2017, up 11 per cent from 2016. It is on pace to exceed $19 billion by 2021, as software as a service (SaaS) enables new revenue opportunities.
“Between 2017 and 2021, Gartner forecasts nearly $6 billion in total software revenue will be added to the SCM market,” said Chad Eschinger, managing vice president at Gartner. “Digitalisation is increasing demand for agility and forcing new business models, which is boosting spending in the SCM market.”
SCM providers are already differentiating themselves from competitors and driving revenue growth by incorporating new digital business technologies, such as mobile, machine learning, in-memory technologies, multi-enterprise visibility and the Internet of Things (IoT), into their range.
Mr Eschinger added that to remain competitive in this environment, end-user organisations are seeking to discover and exploit value in the huge amounts of data generated throughout an ever-extending network of businesses and connections that make up a modern supply chain.
Moreover, the move to SaaS delivery shifts costs from capital expenditure (CAPEX) to operational expenditure (OPEX), which makes investment in SCM technology more attractive to small and midsize businesses (SMB) and organisations in emerging markets, therefore expanding the addressable market and increasing overall spending.
The SCM market forecast is made up of three categories: supply chain planning (SCP), supply chain execution (SCE), and procurement. Adoption and associated revenue for SaaS are moving through the market at different rates, with procurement leading the move to cloud, and SCP trailing.
Overall, SaaS revenue growth is driven by a combination of factors: vendors moving to cloud-first or cloud-only deployment models, and end-user organisations becoming more comfortable with issues such as cloud security and appreciating the capabilities and innovation of leading-edge SaaS solutions.
By 2021, SaaS deployments are forecast to account for more than 35 percent of total SCM spending (see Figure 1). Sales of on-premises licenses will decline to less than 20 percent of total spending. Hybrid SCM environments with coexisting cloud and on-premises applications are becoming more commonplace, with information hubs and supplier networks dominating the move to cloud.

Figure 1. SCM Software Forecast by License, Maintenance/Support and SaaS Spending, 2015-2021. Source: Gartner (June 2017).

“To help support next-generation supply chains and real-time business requirements, we expect consolidation of existing solutions into broader, multidomain suites, but also a continued stream of new point software that will support innovation, address specific needs and offer new value,” said Mr Eschinger.
“The growing impact of digital commerce will drive greater investment in supply chain analytics, and the lure of faster decision making and eradicating inefficiencies will drive investment in smart machines and IoT and the associated SCM software.”
 

The 2014 Scorecard: What was predicted and what really happened?

Gareth Berry examines three of the biggest predictions made about the
manufacturing and logistics industries 12 months ago and how they have fared at
the end of the year.

A new year is an excellent time for making predictions for the months
ahead. As real news slows, the media turns to forecasts for everything from
consumer spending and politics to interest rates and sport. How reliable are
these predictions and can a business plan their strategies based on mere guesswork?

Prediction 1: The rise of the
demand-driven supply chain

The increasingly popular subject of agile methodologies has led to considerable
discussion about changing the focus of the supply chain from pull (forecast-driven)
to push (demand-driven). However, creating a market-responsive system relies on
the ability to readily access and share data along the supply chain,
specifically requiring accurate knowledge of inventory, exceptional visibility
into demand and consumption, and agility to quickly act on changes.

Even five years ago, the technologies to support such a view were not
accessible to many organisations, especially small to medium enterprises due to
cost and resource considerations. However the advent of the cloud brought apps
for every logistics need within the reach of all businesses, offering the
opportunity to gather more data about their business, market and customers than
ever before. Companies adopting agile approaches to the supply chain were also reporting
solid market success leading to the prediction that the demand-driven supply
chain would finally gain momentum.

Twelve months on, we may not have seen the end of the forecast-driven
supply chain but it’s clear a shift has begun. Demand-driven strategies are
gaining adherents and continue to intrigue the market. With additional
developments such as big data on the horizon, it’s reasonable to assume that
the change from pull to push will continue into 2015.

Prediction 2: Big data and
analytics

The last year has
seen everyone spruiking the unrealised value of big data, better explained as the
mass of structured and unstructured data that sits within every organisation. The
idea was that mining this information by correlating diverse, previously silo-ed
data would help organisations gain insights into improving production, better
forecasting demand, and engaging in analytics among others. Many vendors were
said to be working hard to develop ways of easily and quickly harnessing the
data last year, with analysts predicting that big data would be one of the
biggest trends of the year ahead.

While the topic has definitely made waves, primarily among large
enterprises and government departments, big data still remains a tool for the
future. There is huge potential and everyone agrees there will be benefit from
using big data; however, it is still not clear exactly how data should be used,
what data should be used, or what benefits can be gained from the data.

In the meantime, use cases will emerge almost by stealth as business
applications begin to engage a wider range of organisational data. Cloud
applications are expected to lead the way in this trend because of their
comparative agility and reach.

Prediction 3: Need for systems upgrade
will see businesses become more open to new technology

The ERP and supply chain systems that are being deployed today are
vastly different to those of five or ten years ago. Cloud technologies, mobile
apps, mobile devices and social media are redefining the way business is
conducted with users having tremendous flexibility to select from on-premise,
cloud and hybrid systems, integrated suites of applications and best-of-breed
solutions. Unlike old-style solutions that embraced a certain predictability,
technologies that enhance responsiveness and agility are key in the post-GFC
world.

The prediction that businesses would be more open to new approaches to
technology in 2014 was accurate. But it can equally be applied to most of the
last five years and to every year in the foreseeable future. When everyone in a
market is chasing competitive advantage, openness to new experiences,
approaches and methodologies becomes an essential trait.

Trimble acquires Australian Mining Information Systems

Trimble has acquired private Australian enterprise level information management company Mining Information Systems (MIS).

According to Trimble these new “enterprise level capabilities can enable improved productivity, profitability, and safety by providing a more complete view of geospatial, productivity, workforce, and cost data across functional areas to support better operational and strategic decision making”.

Mining Information Systems provide systems for data needed for enterprise wide monitoring and management of mining and minerals processing operations.

The programs are modular, with systems for mining production, processing, HR management, and web-based portals for access.

These systems are scalable and not restricted by different mining methods used.

“MIS systems collect and integrate data across
functional areas and sources, regardless of data origin. This capability
combined with Trimble’s geospatial solutions can provide increased mine
productivity through the aggregation, analysis and presentation of information
that enables better decision making for mining customers,” Trimble said in a company statement.

“Productivity applications in functional areas such as drill and blast,
haulage and materials processing have improved operational efficiencies, but
the value of this data has not been fully realised since it is not readily
collected and integrated for a complete, site-wide view. MIS offers an
enterprise-level system that unlocks data and metrics from across functional
areas for a complete view of mine productivity and profitability for decision
makers across planning, operations and finance,” Nathan Pugh, business
area director of Trimble’s Mining Division, said. 

It did not disclose the cost of the acquisition.

Smart supply chain planning: part 4

APS tools

Technology has always driven the evolution of

manufacturing/distribution systems.

Chris Macquet

Introduction

Most know that it has been IT that has driven the evolution of ERP-type transactions systems, good at recording transactions and analysing history. New technologies, such as the internet, have enabled many companies to gain competitive advantage in the market place.

Very few know that the same evolution has been taking place in supply chain planning systems, so it makes sense to chart both as they have evolved and progressed over time.

Currently at Generation 4, the most modern APS tools can now solve any optimisation and scheduling ‘puzzle’, whether it has been in production, logistics or workforce environments, whether it has been in strategic optimisation or in detailed scheduling. You still do require, however, business analysts and model builders to solve each ‘puzzle’.

In the future, new, Generation 5 ‘easy-to-use’ APS software will allow educated users to ‘do it all’. E-learning will get you up to speed, with APS tools being available ‘on demand’ via the internet.

How important is planning?

Planning is, by definition, more important than measurement and control. Not only should it logically come first, it also sets up your business operations, optimises your resources, satisfies your customers and determines your profitability.

Hence it makes sense to spend more time and money on getting your planning right than on your accounting and/or tracking system. If you don’t have the right materials, equipment, personnel or other resources, if you don’t have the capacity, you cannot produce nor transport.

Given all the things you need to balance, good planning is hard. If you need to consider all the constraints in your supply chain, measure intangibles such as customer and employee satisfaction, and find that you can’t work it out on a planning board or Excel spreadsheet, then you probably need an advanced planning and scheduling (APS) tool.

Does an APS tool need to fit your business?

Each and every company is unique, in its people, its products, and the way it does business. For a planning tool to be successful, it must provide a 100% fit to your requirements. Otherwise, your planners and schedulers will immediately go back to their own tried and tested ways.

As Eli Goldratt, of Theory of Constraints fame, puts it “The PLAN or SCHEDULE is the nerve centre for all IT systems for a manufacturing (and/or distribution) company”. Hence an effective APS tool enhances the effectiveness of all the other IT systems you may have.

A good planning system is also the heart and hub of your supply chain, with most of your operations depending on it. Hence attaining 100% fit to your business is doubly important.

An APS tool must be flexible and adaptable as you grow or the market changes, enabling you to find better ways of adding value to your business and/or to your customers over time.

Do you need to plan more than one resource?

Your APS tool obviously needs to look at all resources that are constraints in your supply chain – materials, production capacities, transport, skilled operators and other personnel.

For example, transport fleets cannot be planned nor scheduled without taking into consideration all the above, plus government or union regulations.

The latest technology APS tools not only enable you to consider all such factors, but it enables you to buy one tool that can address all your planning needs.

How often do you need to plan?

Traditionally, management accountants analysed what happened last month to advise management what to do next. Well, those days are over. They can now use optimisation, planning and scheduling tools to constantly review and ‘optimise’ the current position, ensuring they move constantly to a better operational and profitable position.

Traditional APS tools require someone to hit the ‘optimise’ or ‘schedule’ button whenever actual outputs or performances have deviated significantly enough from plan to warrant it. A few APS tools allow one to program specific time intervals to do this, irrespective of relevance.

Real-time optimisation and scheduling?

Modern APS tools now do this automatically, based on the rules required or provided by your business, and a modern solving engine designed to do just this.

If your production or transportation environment or resources are constantly moving and changing, then you need a ‘real-time’ planning, optimizing and scheduling tool to keep you on track in making money and keeping customers happy.

For example, DHL guarantees express deliveries of millions of parcels around Europe and Asia. From the moment a client places a request for a pick-up, the clock starts ticking. The client is not interested if his usual DHL man has gone past a point of no return (cannot backtrack on his planned route) or not, he just wants his parcel delivered in, say, 12 or 24 hours.

So, DHL has in place real-time GPS feedback on all its drivers, knowing what has been delivered, what has been picked up at any point in time. If a DHL depot simply cannot re-route any of its drivers to do this pickup, it can look at who is available from other depots, and choose another driver who will have least impact on overall efficiency and customer service, and allocate and schedule this new pickup into that driver’s route in real-time.

Multi-user, multi-company planning?

No planner is an island. They all work together across the extended supply chain, from supplier’s supplier to customer’s customer. All collaborating, working together, on the understanding that it is their supply chain competing against their opposition’s supply chain.

And in many cases, like the Australian mining supply chains, you can have several stakeholders all very interested in the supply chain schedule. From mining companies, jealously protecting details of their shipments and customers, to rail operators, to port authorities, to port terminal operators, to ship operators, all are vitally interested in detailed schedules.

So, you need to create ‘glass houses’ or ‘lead boxes’, security environments where all data is held, optimised and/or scheduled according to agreed rules and procedures. Gantt Charts and other presentation views are then presented to all such that each party can see only their own details, and the rest all ‘greyed’ out.

How far and deep do you need to plan?

Your APS tool must also be capable of addressing every level of planning from strategic and tactical optimization to detailed scheduling, ensuring that profitability and customer service are in sync.

It also needs to be scaleable, capable of growing, handling more than one site or situation. The DHL example above with 200 depots across Europe illustrates this point.

Who is in control?

Planners and schedulers need to be in control, they need to define the rules and decision criteria as they are the ones making the planning and scheduling decisions. If the APS tool does not give them 100% fit, and is not better than what they used before, it quickly gets rejected.

The tools need to be highly visual in both developing the solution and in daily production. Interaction needs to be fast and intuitive. The traditional magical ‘black box’ approach is now history!

How do you get 100% fit?

You need to have a process that incorporates all the rules and knowledge of the business. And this is a re-iterative process, constantly working to ensure you have every rule that can be feasibly incorporated. Only then do you need to run ‘optimisation’ solves to ensure that you are moving toward more profitable positions.

Traditionally, many APS vendors have put the optimiser or scheduler (‘black box’) in first before anyone really knows whether or not it actually reflects the way you run your business. In such cases, it has been difficult to explain the behaviour of the ‘black box’ as it responds to changes.

Multi-solve capabilities?

The most difficult optimisation and scheduling challenge I have come across in manufacturing has been in aluminium smelters, casting houses and rolling mills. It is about 2-3 times more difficult than hot steel mills since one has to find both the best combination of both ‘optimised’ product mix and ‘best’ schedules in one solve. In hot steel scheduling, you need to produce specified grades of steel out of specified grades of coal and ore, whilst managing the volatility of raw materials and processes as these deviate from product specification during the process.

In aluminium, you need to do this whilst simultaneously considering different product mixes and outcomes in optimising profits, as each mix will have different routes or schedules. So, you need to solve for both product mix optimisation and ‘best’ schedules in one pass.

Therefore any APS tool developed in this environment is likely to solve the ‘best formula’ and ‘best schedule’ dilemma that many process industries have – metals, food, dairy, sawmills, petroleum, paper and pulp, packaging, textiles, and so on.

Solve for carbon footprints?

TNT Logistics intend to use a 4th Gen. APS tool to incorporate weighted ‘carbon footprints’ into any financially orientated solve, to ensure they are considering environmental issues and other stakeholders (besides shareholders) in coming to any ‘best possible’ decision.

Speed of implementation? High ROI?

In a recent large European packaging company (owned by Graham Hart, NZ entrepreneur), the development of a new S&OP project was quoted and implemented in just 80 days, against the proposed 2,000 days effort using conventional APS tools.

In the future, this would be speeded up if an industry-specific template for packaging had been available, cutting down design and implementation time even further.

One package, many solutions?

The modern 4th Generation APS tool is capable of being applied to all sorts of optimisation, planning and scheduling opportunities relatively quickly. Other than mentioned above, other examples include:

• handling air traffic congestion, scheduling of customs posts according to incoming passenger profiles / volumes, and other aviation planning activities;

• public transport, ensuring timetables are kept to, even employee satisfaction;

• dynamic workforce optimisation such as security and police work where unexpected events and associated risks need to be managed according to predetermined parameters;

• health care where planning is crucial in determining both performance quality and financial success;

• media and entertainment which operate under high-pressure timetables and deadlines, yet still need to deal with the unexpected ‘news’ items;

• co-ordinating sales promotional campaign planning with supply chain planning to determine the profitability of each promotion, its impact on existing products and the current supply chain which may have constraints raw materials, production capacity, storage, channel distribution, logistics.

And so on. Literally, any ‘puzzle’ that can be optimised and/or scheduled can now be solved. And without any customised coding!

Don’t take my word for it, the proof of the pudding is always in the eating! Look at the results, not the promises.

Conclusions

For all those who want 100% fit to their particular ‘puzzle’, who want a fast and focused ROI in any production, logistics and workforce (or combined) environment, modern 4th generation APS tools now make this possible, all from one ‘100% package’ solution and support.

Tomorrow (5th generation), these tools will be almost as easy to use and as common place as Excel spreadsheets. Yes, we are about to enter into a new era of opportunity and any person with the right skills and determination to e-learn and use such tools will be the ‘optimisation king/queen’ in their company, and well worth their weight in gold!

Chris Macquet is a qualified accountant and marketer who has been implementing supply chain planning solutions for some 40 years in the southern hemisphere. In planning and IT capacities, he has worked for Unilever, Hewlett Packard, SAP, Deloitte Consulting, AspenTech, APS Technologies, and is now Director of Quintiq, Australia and New Zealand.

Excerpted from MHD Supply Chain Solutions, March/April 2008,pp.48-51.

Maximise your ROI

IBS Australia has launched new series of articles on optimal enterprise resource planning (ERP) performance, as a lead up to the Gartner Symposium ITxpo.

IBS Australia is sponsoring the upcoming event, held from 11-14 November 2008 at the Sydney Exhibition & Convention Centre, and will present at one of the solution provider sessions.

Rajiv Parrab, area president for IBS Asia Pacific, said the company wanted to share and enhance its 30 years of experience in developing ERP programs for wholesalers and distributors by participating in the event.

“IBS has helped customers to experience real benefits and value from their ERP system and can offer valuable insights from these case studies,” he said.

The new article series, ‘5 keys for maximising your ROI through optimal ERP performance’, is in line with the theme of the event focusing on building the business case for an ERP replacement strategy, best practices for implementations, maximising business benefits and ROI from an ERP investment, as well as aligning IT with business requirements and strategy.

Peter Clarke, chief technology officer for IBS Asia Pacific, said: “The vertical development strategy IBS has adopted has not only led to specialist industry expertise, but also cross-verticalisation, where the benefits of ERP functionality experienced by one industry in their  business processes has influenced the development of solutions for other industries.”

Mr Clarke will present at the event from 2.14-3.00pm on November 13.

The first article and registration for the entire series is available at www.supplychainsecrets.com.au/gartner.

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