Current Supply Misconceptions By Matt Foust, DCMME Center Graduate Student Assistant

Current Supply Misconceptions

As a profession, those that work in supply chain are constantly on the lookout for initiatives that can make companies more efficient, cut cost, or incorporate new technology (usually to become more efficient or cut cost).  But not all of the newest hype is always worth an investment.  And some of the newest trends or prevailing knowledge don’t always save time and dollars.  In the article The Biggest Supply Chain Fallacies, we will look at some of the current misconceptions and over-hyped technology that currently are in the supply chain industry.

Regarding newer technologies, Blockchain is very popular just about everywhere.  Through its rise in cryptocurrency, many companies have taken notice and exploring where Blockchain might add value.  I’ve even wrote in recent blogs about Samsung is planning to implement Blockchain in its logistics.  But Blockchain isn’t without its issues, and the author of the article brings ups a very good point – Blockchain cannot overcome the issue of garbage in – garbage out.  Suppose an upstream supplier lies about what they are doing and enters the untrue information in the Blockchain.  This information will be regarded as true and is unable to be changed later on.  The need for certify and monitor suppliers is not solved by Blockchain, and since Blockchain’s records are unchangeable, the need to certify may actually be more important.

The next fallacy is that Corporate Social Responsibly (CSR) initiatives will assuredly drive better financial performance.  Unfortunately, this is just not true. CSR programs can reduce cost such as initiatives to reduce fuel consumption through better routing and more full truckloads, but CSR programs overall tend to be better looking from the outside.  A realistic view of CSR programs is that may reduce cost, they will most likely attract better talent, and they will attract positive attention to the firm.  Overall, CSR matters more in wealthy nations and to younger employees, and its important to be realistic about what can be achieved through their usage.

Finally, the last supply chain fallacy discussed is the apparent truck driver shortage.  This shortage, as claimed by the majority, is due to the fact that younger people do not want these jobs. But the basis of this issue is most likely just economics.  The average wage for the truck driver according to is a bit over $42,000/year.  At that wage, most young people do not want that job.  If wages went up, economically it would make sense that there would be more individuals that would want to drive trucks.  And in fact, that is apparently happening.  From 2013 – 2017, truck driver salaries increased between 15%-18%.  As wages increase, there will eventually be more drivers, and this shortage will be solved.  Interestingly, the author of the article brings up automation taking the place of drivers as wages rise.  Autonomous vehicles are a hot topic right now, but it’s highly unlikely that autonomous trucking fleets make their way on to our roads anytime soon.

As supply chain professionals, its important that we discern fact from fiction and over-hyped technology from value-adding technology.  Getting differing opinions, staying well read, and keeping an open mind appear to be the best ways to move forward, even in an ever-changing environment.



Do you believe these points to be true?

Are there other supply chain misconceptions not mentioned?

Where will blockchain’s utility be found or is it most likely not useful in a supply chain context?

Using the Cloud to Improve Warehouse Performance by Nick Wright, DCMME Center Graduate Student

Using the Cloud to Improve Warehouse Performance

Starting in May of 2018, Ametek Prestolite Power will begin offering Ametek Insight though their Wireless Battery Identification Devices (WBID). Ametek Insight, a cloud-based ZigBee software, is the newest intelligence solution provided by Ametek that, when paired with the WBID, aims to solve one of today’s warehouse challenges – fleet optimization.  The WBID allows users to continuously and remotely monitor an entire fleet of forklifts using real time data, transmitted and collected using Insight, by managing battery performance, changing settings, updating software/firmware, and more. The ability to use and apply this technology will allow companies to optimize fleet management to extend battery life, increase productivity, reduce costs and ultimately better serve customers. Ametek expects that Insight will eventually become a standard feature on a majority of its batter charger, not just offered through WBID. Can this technology be adapted to optimize other areas of the supply chain besides forklift operation? As the Internet of Things and real-time data analytics takes a more prominent role in supply chains, how will the job of a supply chain manager change?

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Staying Ahead of Customer Needs with the Help of CNC Technology, By Nick Wright, DCMME Graduate Student

Staying Ahead of Customer Needs with the Help of CNC Technology

Bridge Tool & Die is a major player in the Carbide tooling market since 2005 and has been transitioning from the use of manual grinders, the tooling industry norm, to the use of automated CNC grinders to increase productivity, capacity, and quality in the hopes of being able to better serve its customers who are continually looking for better and cheaper solutions. This transition began back in December of 2015 when Bridge Tool & Die implanted a Three-Pronged Strategy to enhance their manufacturing processes by reducing machining time and increasing consistency. The three prongs were: retrofitting their existing manual grinders with CNC, setting up multi grinder work stations, and purchasing high-end CNC machines. Using this approach, an operator would theoretically be able to operate three machines at once – one manual, one CNC, and one semi-automatic grinder. Most recently, in 2017 Bridge Tool &Die invested in a Studer CT960 CNC multi-axis grinder to further improve quality and capabilities, boasting of grinding parts in a third of the time, halving the polishing time required, and achieving tolerances of 0.0001” in an industry where the market normal is tolerances of 0.0004”. As well, the new CNC machine is lowering costs for Bridge Tool & Die, as it is expected to require two fewer operators to run, reducing labor costs for the company. Glenn Bridgeman, the owner of Bridge Tool & Die, states that “The need for increased technology was not driven by reducing operators in our shop . . . Rather, it offers us the ability to keep all of our experienced operators, and address capacity versus technology-allowing us to grow over 15% per year.” Will Bridge Tool & Die continue in its trend towards a more automated grinding process? How will industry competitors react to their ability to achieve above normal tolerances? How soon before automation with CNC becomes the new norm and all manual grinding, both at Bridge Tool & Die and elsewhere, becomes obsolete? How will Bridge Tool & Die continue to improve its processes beyond the use of CNC grinders?