Supply Chain Management

Supply Chains are all of the organizations, people, and processes that are involved in the sourcing, creation, distribution, and consumption of your product or service. Supply Chain Management (SCM) is the effective design, operation, and improvement of this network of organizations and people that may exist on a global basis.

Most organizations have only given serious attention to their supply chain in recent years. Previously, individual organizations were only concerned about their own operations, those that they owned and controlled. Now it is recognised that the product or service that the end customer receives will be influenced by actions across the whole supply chain, and that the success of individual supply chain organizations is strongly influenced by the actions of the other supply chain members. Supply chain management is based on this understanding and is focused on maximizing the performance of the whole supply chain.

Most people consider social media to be platforms for dialogue between themselves and their closest friends and favourite social influencers. Of course, marketers and organizations use social media to promote products and brands, communicate with customers, and gather data from their target audience. It’s not surprising that discussions involving the application of social medias rarely focus on supply chain and distribution implications; however, this function within a business and between businesses can benefit almost infinitely from a strong network of social media and communication platforms. Many companies are beginning to look to other areas of their business to either cut costs or earn more income, and their supply chain has become an increasingly popular source for such activity. One company capitalizing on this newfound value centre is SDVI, a resource management company that helps media and entertainment companies organize their data and information supply chain to improve the agility and efficiency of their media infrastructures (Market Wired, 2016).  

Creating a supply chain that is both efficient and properly managed can be difficult. Between ensuring visibility across channels, product development, customer service and accurate inventory management, maximizing the performance of a company’s entire supply chain can be complicated. For a company like Ryder, though, supply chain management is what the company excels at. Ryder is a Fortune 500® commercial fleet management, dedicated transportation and supply chain solutions company. With over 50,000 customers, Ryder boasts a 99% on-time delivery rate, 80+ years of experience and a fleet of more than 230,000. Ryder has been recognized for its industry-leading practices in third-party logistics, environmentally friendly fleet and supply chain solutions, and world-class safety and security programs.

Toronto’s Furniture Bank moves people in countless ways. Their mission, to bring gently used furniture (for free) into the lives of people transitioning out of homelessness; newly-landed refugees; people transitioning out of abusive situations; and more, is no easy task. Through partnerships with 1-800-GOT-JUNK (a waste-collection organization which often comes across gently-used furniture and housewares), You Move Me (an associated moving company), and others, Furniture Bank is able to meet the demands of this important community service. Added to this chain is a long list of social service agencies whose role it is to identify clients in dire need of furnishings. From the moment a citizen picks up the phone and asks how they can contribute their used furniture to Furniture Bank, the wheels are set in motion with the associated ‘supplier’: The pickup and delivery of furniture to Furniture Bank, the sorting and curating of the materials, the partner agencies identifying candidates/families in need, and clients/families visiting Furniture Bank and selecting the furniture that will bring dignity to their homes and their lives. Some more on Furniture Bank’s daily mission: Martin’s Story

“There aren’t many organizations globally that source their raw material from their friends and neighbours.” That was how Dr. Graham Sher, CEO of Canadian Blood Services (CBS) opened his remarks during the Queen’s Health Policy Change Conference Series in Toronto last summer. CBS manages the national supply of blood, blood products and stem cells, and related services for all the provinces and territories (excluding Quebec). It may seem odd to classify blood as a raw material to be processed, but that’s exactly what it is. And in 2016, those friends and neighbours Sher mentioned supplied more than 1.2 million units of these products. But reaching that level isn’t easy, given that one in every two Canadians is able to donate, but only one in sixty actually does. And every year, almost 40% of donors stop giving due to changing eligibility requirements, attrition and other reasons. With a relatively small pool of ‘suppliers’, every donation counts and every missed or cancelled appointment is a lost opportunity to not only replenish the supply of blood products, but to provide vital data that helps hospitals determine inventories, schedule procedures and ensure an adequate supply of products for emergency use. Social media campaigns have been used in various industries, from pizza producers to newspaper publishers, to collect data and improve supply chain efficiency. In this case, CBS uses data gathered from social  and other digital tools to guide its recruitment and retention campaigns.

Adidas’ and FIFA’s relationship dates back 47years, and since 1970 Adidas has been supplying the official match ball for all FIFA World Cup™ matches. The partnership was recently extended until 2030 granting adidas the Official Partner, Supplier and Licensee rights for the FIFA World Cup™ and all FIFA events until 2030. The announcement was made during a ceremony in Moscow by Thierry Weil, FIFA Marketing Director and Herbert Hainer, Adidas Group CEO. Adidas wants to preserve its position as the number one seller of soccer gear worldwide. In 2010 Adidas, was the first and only outfitter and licensee to disclose the list of suppliers/factories involved with the production of World Cup products of the 2010 FIFA World Cup South Africa™. Adidas Supply Chain Structure Adidas is currently outsourcing most of the production to more than 1,000 independent factories from around the world. Adidas products are manufactured in 63 countries and supply chain is global and multi-layered with different types of business partners, some are directly contracted factories, while others are not. The top five countries per region and by number of supplier sites in 2016 were: The Americas (26%): United States, Brazil, Argentina, Canada, and Mexico. Asia (64%): China, Vietnam, Korea, Indonesia and Japan. Europe, the Middle East and Africa (10%): Germany, Turkey, Italy, Spain and South Africa.  The Power of Social Media and Supply Chain Management Adidas has launched a #allin campaign on Twitter. The official World Cup 2014 soccer ball named the Brazuca was given its own Twitter handle (@brazuca) generating over 139,000 followers. The Adidas Football YouTube channel has 350,000 subscribers and is host to various videos showcasing Lionel Messi, featuring the new Battle Pack cleats that were launched in conjunction with World Cup content. One of the videos features the Brazuca that was fitted with cameras into the ball that was sent on a World Journey. In 2014 World Cup in Brazil the Adidas football Facebook page had over 17 million likes, containing pictures promotions, video links. Some of the promotions included signed soccer balls by designated players that could be won by customers by following Adidas soccer related Twitter accounts. This was a way for Adidas to connect to their customer base, fans and anyone interested in Soccer. Adidas is using Social Media to Improve Supply Chain Management The Sports Retail Industry is a highly competitive market and it is very important for companies to… Read more »

In 2014 a global movement started #whomademyclothes. Fashion Revolution  is a not for profit Community Interest Company based out of the U.K.. Since 2014 it has held an annual social media campaign #whomademyclothes in April, on the anniversary of the devastating 2013 Rana Plaza factory collapse in which 1,134 people were killed. The social media campaign calls on clothing brands to take responsibility and demonstrate transparency for their supply chain management. Social media has enabled a global conversation on platforms such as Facebook, Twitter and Instagram for socially conscious consumers who are actively seeking out sustainable fashion and the demand for transparency. Eileen Fisher Inc. is a clothing brand that is managing their supply chain.

October 2017, McDonald’s brought back a rare condiment from the 1990s at the beginning of the month, but the promotion ended in protests and sky-high secondary markets. (Kalvapalle, 2017) McDonald’s is an American hamburger and fast food restaurant chain. It was founded in 1940 as a barbecue restaurant operated by Richard and Maurice McDonald, in San Bernardino, California, USA. In 1948, they reorganized their business as a hamburger stand, using production line principles. Today, McDonald’s is one of the world’s largest restaurant chains, serving approximately 69 million customers daily in over 100 countries across approximately 36,900 outlets as of 2016. McDonald’s primarily sells hamburgers, cheeseburgers, chicken products, french fries, breakfast items, soft drinks, milkshakes, wraps, and desserts. In response to changing consumer tastes and after facing criticism for the unhealthy nature of their food, the company has expanded its menu to include salads, fish, smoothies, and fruit. A McDonald’s restaurant is operated by either a franchisee, an affiliate, or the corporation itself. According to a BBC report published in 2012, McDonald’s is the world’s second largest private employer (behind Walmart with 1.9 million employees), 1.5 million of whom work for franchises. (Wikipedia, 2017)

It’s the wold’s most valuable sports brand. And it all began when founder Phil Knight decided to start selling track shoes out of the trunk of his car in 1976. Today, Nike is a global athletic shoe and apparel juggernaut, with a brand value of nearly $15 billion U.S. But a string of public controversies in the 1990s and early 2000s over the working conditions at some of Nike’s factories around the world threatened to derail close to 20 years of brand building in one fell swoop. Allegations of child labour, poor wages and dangerous working conditions at various locations in its global supply chain triggered widespread protests and seriously threatened Nike’s very existence. And while the company initially denied any claims of wrongdoing, further damaging its reputation, it eventually responded with humility and transparency. Today, Nike makes its supply chain practices transparent and available online and uses social media in various forms to actively listen to and engage with its stakeholders in order to influence where and how its products are designed and manufactured – all critical elements of effective, and modern, supply chain management.

Papa John’s Pizza has been using social media channels to help educate customers where products and ingredients are coming from, and creating time effective ordering options available on channels. Aside from social channels, the company has also used a collaborative technology solution to help support the efficiency of the supply chain. The company outsourced the supply chain needs to Manhattan Associates, a supply chain software company, to help create more time effective and cost saving inventory management. Eric Hartman, Senior Director of Logistics said, “Manhattan solutions allow us to manage inventory levels accurately, efficiently and more dynamically based on actual need—and that has resulted in our being able to reduce overall inventory levels (Manhattan, 2013)”. Using the collaborative software has also provided better solutions to inventory transportation. The software can optimize routes, improving on-time store deliveries, and the overall performance of their fleet (Trebilcock, B., 2014, October). Customer service relies on the speed of the supply chain to help get their products to customers in an effective way that will save time and money.  “Implementation of Manhattan’s solutions has provided unprecedented visibility along with reduced expenses, improved efficiency and productivity in every part of the supply chain (Manhattan, 2013)”. Papa John’s wants to ensure that its “fast food” moves just as quickly throughout every level of the supply chain.

Innovation is the hallmark of internet startups. When Karl Seibrecht co-founded Flexe, a company that many call the Airbnb of warehouses, he had recognized a problem for many companies and came up with an innovative solution. Clients of Flexe can add empty warehouse space that they may have to a registry and clients looking for space can search to find a good match. This is very similar to the Airbnb model of people renting out their spare room or their house on a short-term basis. Karl Seibrecht commented to Fortune.com, “At any given moment there are many, many businesses out there that have too much space, while other businesses don’t have enough.” (Morris, 2015)

Social supply Chain management is becoming more of a success tool. It seeks to incorporate social network, social interactions and social data with customers, stateholders and business owners in resulting in an improved customer service. In most supply chains, the following factors are important; Cost Quality Speed    

Social media is about building relationships, and it can be used in a supply chain to build and grow communications among trading partners. Information and knowledge gathered from the use of social media by supply chain partners can provide insight into various issues. Social media allows supply chain participants to monitor supply chain events and transactions to keep everyone up-to-date with current situations, such as a delay in shipping or a carrier failed to pick-up a shipment. Providing companies with more timely and insightful information about risks and events, enabling them to make corrective action sooner – minimizing the impact of a supply chain disruption. Despite all the major advances in supply chain management and technology in recent years, most restaurants and their suppliers still don’t have a single, integrated, real-time view of supply and demand when working together in an enterprise. The lack of visibility creates a fractured supply chain; one in which the restaurant operator and its suppliers do not operate in sync, resulting in bloated inventory, excessive waste, supply uncertainty, and poor customer service for all parties concerned. So in many ways, the restaurant industry is defined by paradoxes. Consumers want quality food at affordable prices. Product freshness is a must, regardless of seasonal variability. Cost and customer service come bundled – not à la carte. Here’s how procuring works at a typical restaurant. At the end of dinner service, the chef or sous-chef compiles a list of everything they will need for the next day’s service. Once there are tallies, the chef calls and leaves messages with orders for delivery. Some restaurants order from separate companies for produce, meat, fish, dried goods, and cleaning supplies. Others make one call to a large all-purpose company, such as Sysco or Gordon Food Service – (you know those big trucks you see across the country). Although these companies may get the lowest prices and deliver everything at once, they rarely have the best product.

The management of the flow of goods and services is what is referred to as supply chain management. According to Margaret Rouse at TechTarget, Supply Chain Management is defined as “Supply chain management (SCM) is the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer. Supply chain management involves coordinating and integrating these flows both within and among companies.” Supply chain management occurs in both product companies and service industries.

There is no better feeling than having your skin hydrated, cared for and clean while using products that support a value, cause or lifestyle you align yourself with – organic, natural, environmentally friendly, cruelty-free, ethically responsible, or all of the above.

Few condiments hold a candle to this savory-sweet, palate-pleasing treat enjoyed by adults and children alike. Ketchup, your pairings are endless: eggs, bacon, bologna, hot dogs, fries, burgers, sausages, onion rings, grilled cheese, chicken fingers, fish sticks…alright maybe not endless. That’s getting pretty close to an exhaustive list, as far as any self-respecting person can enumerate. Yes, this powerful condiment possesses an innate ability to make-or-break your summer BBQ. And it recently showed off some of its unique power to rally social media supporters in a very surprising way. Canadian Connoisseurs Speak Up In March 2016, Loblaws decided to pull French’s ketchup from its shelves without warning, inciting a viral backlash demanding Loblaws re-list the item. The sense of importance associated with this particular product most likely stems from its local origins. French’s ketchup is made with tomatoes grown here in Canada; Leamington, Ontario to be geographically precise. Thus it’s a source of national pride, of small-town Canadian jobs and, ultimately, of significance extending well beyond something squeezed from a bottle. This high level of engagement in the supply chain management process led Globe and Mail food columnist Sylvan Charlebois to declare in his Ketchup Wars opinion piece that “the politics of food distribution are alive and well in Canada”. Many speculated that unfair competitive practices among vendors may have had something to do with Loblaws’ decision to de-list the product. Finding evidence to support this theory is challenging. However, the ketchup story illustrates how the complexities of food retailing are increasingly intermingling with unexpected social media uprisings.  

Recognizing social media is so much more then Twitter, Facebook or an online forum, I took my question to Professor Peter Carr of the University of Waterloo to understand what social media really is defined as; he noted: “There isn’t a generally accepted definition and opinions probably include narrow, which would be restricted to popular public tools (Instagram, Twitter, Facebook, etc.) and broader, including any form of online communications (email, Yammer, SharePoint etc.). I use the broader approach, any online communication between two or more people could be included.” Understanding Carr’s definition on social media, we can really look into how might social media fit into companies – and in what realms? Specifically for the topic of this post, how does social media fit into supply chain? From course material in my Social Media for Business Performance at the University of Waterloo, it is discussed that there are a variety applications for social media in the supply chain, but there are a few I really want to focus on that I find make an interesting case study: visibility, stakeholders and purchasing.

Supply chain planning is like a game: As the pieces move, the plan changes – Marc Bombet, Director Business Systems Architecture, Western Digital.  Through the immediate feedback provided by customers on Social Media, companies can quickly respond and react to their customer supply needs as they change. Parle Argo is India’s largest food and Beverage Company.  In 2009 it launched HIPPO Baked Munchies offering a range of chips in various flavors.  It’s campaign “Hunger is the root of all evil. Don’t be hungry” can be viewed in the media below.

Climate change and environmental accountability are both hot topics in the 21st century. More and more people are becoming concerned about the products they buy and what impact on the climate their production has. It has been reported that also more businesses are increasingly taking environmental performance into account when selecting suppliers. In July 2009, Wal-Mart announced its intention to create a global sustainability index system to keep track of products ratings according to the environmental and social impacts of their manufacturing and distribution. The motivation behind the index is to create environmental accountability in Wal-Mart’s supply chain and to encourage other retail companies to do the same. Wal-mart Stores, Inc., doing business as simply Walmart, is an American multinational retailing corporation that operates as a chain of hypermarkets, discount department stores, and grocery stores. As of January 31, 2017, Walmart has 11,695 stores and clubs in 28 countries. Walmart is the world’s largest company by revenue – approximately $480 bln (2016), as well as the largest private employer in the world with 2.3 million employees. Walmart Canada has stores in every province and territory, except for Yukon and Nunavut. Walmart Canada has in total 410 stores (January, 31st, 2017).

Supply chain management (SCM) relies on, at its core, people talking to people.  Working with vendors, coordinating shipments and carriers, buying stock, fulfilling orders, maintaining inventory levels, forecasting what end users may be looking to purchase in the future – every step of the way involves communication between one party and another. “Social networking is not about socializing, but about facilitating people-to-people communication and collaboration, which is at the heart of managing and executing supply chain processes.”  “What is needed [in a dynamic business environment] is a supply chain of rapid response…Many people who work in the materials business [and] talk about supply chains and the speed of supply chains [have historically] thought about systems talking to systems across enterprises and about processes. But in reality, the speed of the chain is not really related to the systems used by the various companies—it’s all about people, and people talking to people”

If MIT Professor Edward Lorenz hadn’t gone for a cup of coffee when he did fifty-six years ago, his 1972 seminal paper, ”Predictability: Does the Flap of a Butterfly’s Wings in Brazil Set Off a Tornado in Texas?” [1] may not have been written, Robert Redford may not have played a wise gambler in the 1990’s movie “Havanna”, Ashton Kutcher may not have travelled back in time in his 2004 movie, “The Butterfly Effect” to fix his childhood, and perhaps, least of all, chaos theory [2] may not have been discovered. For those unfamiliar with Professor Lorenz’s story, on that day in 1961, Lorenz was repeating a simulation he’d run earlier — but this time he rounded off one variable, from 0.506127 to 0.506, of the experiment’s 12 variables, representing things like temperature and wind speed to simulate weather predictability. To his surprise, when he got back after coffee, that tiny, tiny alteration (a 0.000127 difference) drastically transformed the whole pattern his program produced, over two months of simulated weather. “It was philosophically very shocking,” [3]  says Steven Strogatz, a professor of applied mathematics at Cornell and author of Nonlinear Dynamics and Chaos. “Determinism” [4] was equated with predictability before Lorenz. After Lorenz, we came to see that determinism might give you short-term predictability, but in the long run, things could be unpredictable. That’s what we associate with the word ‘chaos.’ ” How does this lesson, that a minute change in variables can have an enormous impact in outcome, affect business product launches today? Let’s look at a recent failed social media effort to access millenials’ wallets. On the surface, it was a winner: the 2014 non-profit industry celebrated a huge success with its major international ALS fundraising movement, “The Ice Bucket Challenge”. The program went viral, raised over $115 million in donations, and attracted 2.5 million new donors [5]. Naturally, the ALS non-profits ran the same program again in 2015, but to their surprise, raised only $500,000, or 0.00434783% of 2014’s donations. So what was the minute variable that had changed in just over a year to cause the failed fundraising? In Philip Haid’s article, The Ice Bucket Challenge Part 2: What we can learn from why it didn’t work [6], he suggests the ALS non-profits forgot to consider the “why” variable in the program’s 2015 success. “Most people don’t interact with charities on a daily basis the way they do with their favorite brands, so it isn’t easy… Read more »

Each year we print four billion flyers that are read by 81% of our readers, making them the most used source of local shopping information.  For Metroland Media, their competitors and readers, these numbers are astonishing. Supply chain management is now more relevant than ever in terms of any organization succeeding. Products need to be properly designed, developed and distributed, while still being cost effective, easily adaptable to changes in the product or market and remain at a high-quality level for customer satisfaction. Metroland makes it apparent that the products they produce find there way into the customer’s hands with the same quality it left their organization. They know that improving their network of organizations and people involved in these processes enhance a variety of factors within their supply chain. Metroland Media is an excellent example of how an organization should run their supply chain and how it can be managed and improved.

At FlashStock, operational efficiency is key to the growth and success of the company. Our core product is custom images and videos taken by our network of global contributors which is delivered to brands around the world through our machine learning technology. Even with this automation, we need to ensure that the customer is properly managed throughout the customer lifecycle. Having better insight into the process, through the collection and use of data, allows FlashStock to scale resources as needed for all client project sizes, effectively manage the pipeline of business, and ensure the proper management of those resources for optimal productivity. Some say having a well-oiled supply chain is a key competitive advantage. FlashStock views the supply chain as key for tracking and measuring that we are going above and beyond for our clients delivering what we promised.

Grey Rock Clothing Co is a one-stop shop for sweatshop-free and organic clothing located in Guelph, Ontario. Founded in August 2012, they have seen wild success in the local community and have created a lot of buzz for their industry and for responsible, fair-trade shopping in general. Since August of 2015 they have been a B Corp Certified Company. This assures customers that they meet the very rigorous standards set out by the B Corp Community. How does a company become a B Corp Certified business? By adhering to some pretty strict guidelines and by doing a lot of research on their suppliers. Grey Rock Clothing Co has to scrutinize their entire supply chain to ensure they are practicing what they preach when it comes to being good for workers, the community, the environment, and for the long term.

Budget Marine is the Caribbean’s leading marine chandlery with retail locations throughout the Caribbean.  In the Caribbean, most people use social media to let friends and family know where their latest landfall is, and for obtaining information through cruisers’ nets. Using social media as a tool to improve business performance is a new concept.  However, for companies like Budget Marine, it opens up vast new opportunities.  People may not think of the Caribbean when they think of “multinational companies,” but that is exactly what Budget Marine is.

Supply chains are all of the elements, organizations, people, and production systems involved in the creation, distribution, and consumption of a product or service. Supply Chain Management (SCM) recognizes that all of the players and processes in the system are interconnected. When one player fails or doesn’t deliver up to expectations, product success can be diminished or lost. From Napoleon to Hitler, this idea of guarding supply line control carries has always carried mythical, and real military implications in our history. SCM proposes that collaborative practice among commercial stakeholders is an appropriate driver for successful enterprise today.  But does this practice actually work? Is collaboration actually business bullying of the larger buyer over the smaller supplier into resentful submission?  Imbalanced business relationships such as these usually create suspect questionable dialogue between such contracting parties? There are always going to be continuing “best deal” dynamics involved or intellectual property or data source to protect. If you squeeze your supplier, why would the supplier necessarily share pertinent information with you? However, we know that few organizations operate in a vacuum. Supply Chain Management proponents suggest that these problems must be overcome or the risk of disruption is heightened. There is too great a risk that outside influences or 3rd party organizational failures can disrupt a competent company’s best laid internal plans, if an appropriate dialogue is missing from the workflow between people and companies. We are reminded that this supply chain is a journey of a product or service from inception to delivery. It must by necessity, include the interaction of a myriad of players and sub-contractors, growers, developers, marketers, wholesale to retail, depending upon the nature of the product. In an outsourced, overhead efficient world, few successful organizations function in a manner permitting them to produce all of the services or products necessary to deliver their final product. We see numerous examples of supply chain problems around us every day. most notably In Toronto with the Toronto Transit Commission’s continuing difficulties with noted tech giant Bombardier. Observers have placed the cause of the delivery problems on one of Bombardier’s subsidiaries in Mexico, which is having difficulties delivering prototype streetcar elements to specification, therefore causing delays in the Sault Saint Marie plant and delays in delivery of the contracted street cars to the city of Toronto. These are contracts in the billions, so the illustration here is an important one.