He spoke on leadership and the key characteristics that make for successful leaders. One of his key characteristics for a successful leader was that they plan for risk. He learned this trait from one of his mentors early in his life who was a judge. Mayor Giuliani had many examples of how he planned for risk. When he was a lawyer, he would prepare four hours for every one hour of court time. When he was the mayor of New York City, he and his leadership team would prepare for every conceivable type of terrorist attack on the city. Now did they prepare for planes to be flown into the Trade Center towers? No, but their level of preparation helped them to quickly adapt to the situation and revise accordingly.  

As I tried to relate his ideas to dealing with risks in the supply chain, my mind became filled with many examples of how the supply chain leaders that utilize our JDA solutions plan for risk. Some are fairly straightforward, such as adding back-up generators for distribution centers, and acquiring alternative methods of data communication if network pipe goes down.  

But there are other opportunities to mitigate risk that are not as obvious and offer great opportunities across the broad supply chain industry. One of these is the migration of business applications to the cloud. More and more companies are embracing the cloud and its ability to provide application uptime, scalability and consistent performance. I know what you’re thinking… “Yeah, I get it. This is for when natural disasters occur like tornados.” That is true, but have you ever experienced a system meltdown during your busy holiday season due to a spike in Internet order volume? The cloud can help you mitigate this risk as well.  

Another opportunity is the creation of a supply chain control tower. By this I mean that you design predefined, alternative processes within your operation that can be used if and when your current processes cannot be properly executed. Let’s review a few examples: How will your company redesign its use of plants and current inventory when an earthquake knocks out one of your production facilities in Taiwan? Also, how quickly can you revise your transportation network if there are massive floods blocking roads in the U.S. Midwest, or if one of your key carriers goes out of business?  

Lastly, and possibly the most critical, is how to plan for risk when a product recall occurs. There has been an uptick in activity on this topic due in part to recent Food Safety legislation and the imminent start of ePedigree controls in the pharmaceutical sectors. I am proud to have been associated with a number of companies that have shown true leadership in protecting their brand and ensuring they provide safe products for their customers. For instance, one company has been doing mock recall tests with our applications for more than 10 years! They started this practice well before the days when product safety became a mainstream discussion. Unfortunately many companies still lack the controls they need to be compliant. You can tell from the television news announcements how prepared a company is for a recall based on the information they can share. Some companies have to recall EVERYTHING as they do not know where the tainted goods have been shipped. Other announcements are more focused and can state the specific lot codes, retailers and cities/states that were involved. The leaders for these companies have properly planned for risk.

What do you think? What is your company doing to plan for risk in your Supply Chain?

Tuesday session highlights included presentations from Skyworks Solutions, Loblaw’s, Kimberly-Clark and Owens & Minor, all of which were well-attended and included some excellent Q&A interaction from the attendees. Solution sessions on Allocation and Replenishment, Category and Space Management, JDA Services, Merchandise Operations and many more provided an abundance of product and customer options for the afternoon.

Tuesday night’s Miami-themed reception included international food trucks featuring a wide variety of South Florida delicacies, along with sights and sounds from Miami wharf-themed dancers rocking to the event DJ and his Mini Cooper-inspired boom-box. It made for a colorful and energetic end to another great day of inspiring keynotes, products sessions and networking as far as the eye could see.

If you didn’t get a chance to attend this year’s FOCUS or if you simply want to relive the event, be sure to check out JDA’s Facebook page for the latest pictures.

The day got off to an impressive start with General Session presentations from JDA CEO Hamish Brewer, JDA Users Group President George Frongillo, Ray Kurzweil, Author, Inventor and Futurist, and others.

Nine JDA customers were recognized as 2013 Real Results Award winners at the annual awards luncheon for their use of innovative solutions, services and industry best practices. In all, seventy-six companies have been name Real Results Award winners over the past eight years, many of which presented at this year’s FOCUS.

After a full day of Super and Breakout Sessions, FOCUS attendees were able to wind down with an evening of networking, fun and fabulous food as the Orlando World Center Marriott’s incredible pool deck providing an incredible backdrop for the FOCUS Grand Party. Live music, games, performers, and even a few speedboats capped off a long but full day of supply chain nirvana.

See the action from #JDAFOCUS13! Photos from day 1 and our morning sessions are up on @jdasoftware’s Facebook Page on.fb.me/16OJSX7

— JDASoftware (@JDASoftware) May 6, 2013

Tuesday promises more of the same so watch JDA’s social media channels for more JDA FOCUS updates as we ‘Come Together’ to share and learn about the tremendous opportunities before us all.

George Frongillo, Users Group President, presided over a standing-room-only crowd of more than 600 at the FOCUS First-Time Attendees Meeting, where he welcomed everyone to the event and MC’d a 30-minute presentation consisting of several presentations designed to help attendees make the most of their time at FOCUS. The presentations were followed by cocktails and a networking session with SIG chairs and managers.

The FOCUS Welcome Reception was a great finish to the day and just the right start for the conference. The Innovation Zone proved the perfect setting for enjoying delicious finger foods and cocktails while visiting the many kiosks, mapping out Monday’s schedules, and visiting with JDA solution experts and partners.

Make sure you stay tuned to JDA’s social media channels for the very latest from FOCUS, featuring photos, video interviews with customers and JDA thought leaders, and our Tweet It to Win It contest where we will be awarding JDA customer gift certificates for the best quote and picture of the day, with an iPad Mini going to some lucky participant at the end of the week.

If today’s crowd and mood was any indication, this year’s FOCUS looks to be the very best.

I’ve summarized major takeaways from the event below and in this video.

Multi, Omni or All?

It was interesting to see who was using what prefixes when defining commerce strategies, i.e., multi-channel, omni-channel, and all-channel. This goes to show that there is no true industry definition, and that these terms are often bandied about. It also begs the question of whether retailers and IT vendors have fully grasped what it means to enable a seamless, fully integrated retailing strategy.

While at the show, retail news headlines from the U.S. gave one example of a retailer redefining their channel strategy. The article titled “Saks Trying to Up Its Multichannel Game” featured a quote from Saks CEO Stephen Sadove that said, “There’s so much integration between store and online sales that we can’t report the numbers separately; they just don’t make sense because we are moving inventory from one to another all the time.”

The strategies expressed by Sadove will be increasingly adopted by retailers. No matter which term retailers use – multi, omni, all, or something else entirely – their objectives will require a single view of the customer and a single view of inventory. Additionally, retailers must empower store associates to offer better pricing decisions based on the knowledge of the customer and inventory. Once retailers achieve this, they will be able to execute on Buy Anywhere, Fulfil Anywhere and Return Anywhere, with a service-oriented culture and supply chain that supports this model. I agree with Sadove in saying there is no way to report sales except as a single brand.

The New POS

In the past we had cash, then credit cards with signatures, credit cards with PINs, and now we have near field communications (NFC), PayPal and online accounts. There are just so many ways that consumers can pay.

Taking payments has always been an interesting topic, especially given the PCI restrictions of holding data, encrypting data from the point of capture through processing to (if at all) the point of storage, and that includes wirelessly paying from an in-store mobile device. Isn’t this where that queue busting technology came in? But it surprises me because PCI has been covered by all those people who produce payment systems online, so all they need to do is to take that technology and offer it using a mobile device in a store, whilst ensuring their wireless coverage is PCI compliant. Why reinvent when everything is already there (excepting payment by cash, of course) including access to product availability across to the whole network, access to the customer record (and loyalty) and pricing power (see above).  So ecommerce, as so elegantly expressed by one of my colleagues, signals the death of the traditional POS.

Mobility

The whole retail scene is on fire about mobile. And judging by what we saw at RBTE, rightly so. As consumers we expect and demand everything on every device, with free Wi-Fi access in stores so we can showroom.  But just think about the type of infrastructure that is required to make that happen. How much bandwidth do you carve up to give your customers access on their devices versus how much for your own cycle counting and queue busting/new POS devices?

With shoppers already having access to a huge amount of information, sales associates really need to be equipped in the same way, with the same (if not more) information – historical combined with social data. Retailers would also want to engage the employee so that when they are on their own time they are able to update their preferences for working on a mobile app, to request time off, pick up shifts, etc. Studies show that the more engaged an employee is with their schedule, the more they are engaged on the shop floor, the better service they give customers, and this can lead to improved sales.

Were you one of the 7,188 attendees at RBTE this year? If so, did you glean any insights that will shape your company’s trajectory?

I gave a short presentation earlier this year in which I asserted that there was approximately $12 trillion of inventory sitting and moving around the globe at any one time last year. I’ll explain how I arrived at that number and also discuss why this question might be important.

First, inventory levels are tracked by some government agencies at a country level. There are various levels of transparency and reporting by these agencies. The U.S. Bureau of Economic Analysis (BEA) is particularly strong in its reporting with detailed and robust data on various aspects of sales, inventory, and pricing. The transparency and availability of this data are impressive. Analyzing this data does require work since much of it is chained to specific years in order to normalize the impact of inflation.

In addition, the Council of Supply Chain Management Professionals (CSCMP) has published for the past 23 years an excellent report titled “CSCMP Annual State of Logistics Report.” This report leverages data from the BEA and other sources and provides great detail on logistics, distribution and inventory costs in the U.S. According to this report, there was approximately $2.2 trillion in business inventory in the U.S. in 2012 (this understates overall inventory since the government, including the military, also carries inventories in its operations). I use this data point and the size of the U.S. economy as a percentage of all global economic activity to calculate an approximate number for the world.

Last year, there was approximately $70 trillion worth of economic output globally. The U.S. represented approximately 22 percent of overall output. Assuming the rest of the world is as efficient as the U.S., a simple pro-rata calculation based on economic output produces the following global inventory level:

Global inventory = $2.2T/22% = $10T

This calculation does not account for the relative efficiency of economic activity across countries (and does not account for government-owned inventories). China, for example, has twice the logistics costs of the U.S. as a percentage of economic activity or GDP. Given that the combined GDP of the BRIC countries is almost the size of the U.S. economy, and if you assume all of the BRIC countries have logistics costs similar to that of China, this would add almost another $2 trillion to the overall inventory number. That’s basically how I arrived at the rough approximation of $12 trillion in global inventory. This likely understates the actual number since it also does not account for relative inefficiencies in other emerging markets (and does not include government-owned inventories).

If this approximation is in the ballpark, it gives us an understanding of the efficiency of economic output relative to inventory. Based on this information, economic output turns against inventory are about six (this would be roughly the same as sales turns). This means there is approximately two months of global inventory sitting around at any one time (on an economic output basis).

My view is that we can do better than six turns. And if we were able to reduce inventories by just 10 percent, that would free up $1.2 trillion in capital that could be deployed to growth activities that would benefit companies, countries, and ultimately people.

Do you agree or disagree with my assessment? What processes and technologies have your organization put in place to ensure inventory turns are positively impacting cash flow?

Stay tuned for subsequent blog posts where I will discuss in further detail how companies can most effectively optimize their inventory strategies, and what the potential impact might be to global economies.

1. Collaboration between shippers, forwarders and carriers

Robert Mellin gave a keynote speech before the plenary that outlined the latest trends affecting logistics and his expectations from the air cargo industry. With shippers becoming more cost and carbon conscious, with disruptions such as the Icelandic volcano, with the increase in manufacturing “re-shoring,” armed with better planning processes and tools, Ericsson has increased its reliance on sea and surface transportation significantly. In fact, Robert bluntly told the audience that Ericsson uses air cargo for only 20 percent of their logistics needs to cater to emergency shipments, and if it can be called good news, Robert did speculate that it will probably not go below the 20 percent mark. But perhaps the most significant comment Robert made was that carriers, forwarders and shippers all need to innovate together and increase the collaboration between all parties. He challenged the forwarders to grant the shippers more access to the carriers and went on to emphasize the need for jointly optimized processes across all players and create a win-win-win scenario for all.

Those of you who read my blog know that this is something I have been advocating for a while. In this internet age, the shipper is the main driver of logistics and not the 3PLs or forwarders. Forwarders and carriers better listen to what the shipper wants and if Robert is to be believed, what the shipper wants is an integrated service and options to choose from. If the carriers knew what to expect from the shipper, then they can plan their rates and service levels with more information than is currently available and in return, the shipper knows upfront what they are getting in terms of service and rates with one voice, unlike today where Robert says he is not sure how much of what he hears is from the forwarder and how much is from the carrier.

To bring about this innovative change to business, I believe shippers like Ericsson can and should do more than just call upon the industry; they must insist that the forwarders bring the carriers to the table and that they need an integrated solution created by partners working together to solve the shipper’s problem. As end customers they absolutely have the power to do so. Carriers on their part should take the risk to tell forwarders that they would not do business with them unless they are seen as equal partners and are given transparency into the shippers’ needs. After all they are the ones with significant risks invested in the supply chain. And they should take confidence in the fact that while they only have 20 percent of volumes, according to Robert they have 70 percent of Ericsson’s logistics spend. That gives them leverage to ensure a seat at the table.

With pressure from both sides, I believe the forwarders will start the required collaboration with carriers and work with them to understand how best to offer a jointly optimized solution to the shipper.

2. The snail pace of e-freight adoption

Everyone knows that innovation is hard in this industry. Look no further than the e-freight initiative launched by the industry in 2006. IATA is justifiably happy that the target of achieving 20 percent e-AWBs by the end 2013 has begun to look achievable for the first time, but if you consider that represents only a 20 percent success rate after seven years of launching, it doesn’t appear all that brilliant. Now there are reasons for this. It is a global goal and there are still many countries where even reliable electricity is still a problem and the e-AWB target is the last thing on their mind. But even the developed world is lagging behind and this is concerning to many innovators in the industry, especially since they see their passenger divisions and indeed other industries around them move in the e-commerce world at a much faster pace.

Almost every carrier I spoke to at the conference blamed the forwarders for not stepping up. In fact, there was even talk of forwarders losing air freight business if they don’t adopt e-freight soon. At my plenary session, Kenji Hashimoto of American Airlines Cargo made the point that e-freight adoption requires significant investment and this cost could be a reason for the small to medium-sized forwarders to not step up to the plate. Against that Robert made the point that if you stacked up all the paper documents Ericsson uses each year to accompany their shipments, it will fill up an entire 747! This is a significant frustration to shippers like Ericsson since they demand solutions that create a reduced carbon footprint, not to mention less fuel costs.

The big forwarders are already on their path to e-freight and if not, can surely afford to invest in the required IT systems to enable it. But for the small and medium-sized businesses, one option would be to invest in community platform solutions from providers such as CHAMP Cargosystems. A different solution to this problem perhaps lies with the carriers. Almost every carrier is investing in a new and modern IT platform. What if, as part of this investment, carriers create a secure community portal for the forwarder community upon which the forwarder is able to participate in e-freight and collaborate with the carrier in return for a reasonable per AWB charge? Carriers stand to gain significantly from this investment because they would then have a collaborative platform with the forwarders, not to mention the move to e-freight by all the parties. Forwarders stand to gain from this as it simplifies their move to e-freight with no capital costs; they can negotiate the per-AWB charge with the carrier. Yes, data security and privacy issues for both parties need to be ironed out but since the platform is restricted to transactions and information relevant to both parties, these should be solvable. And forwarders refusing to participate in such a portal should definitely lose the air freight business and this way, the industry can cajole all parties to invest in this significant innovation.

These two topics generated significant number of passionate conversations during the conference and the industry captains seem keen to change the way they do business. I think they sense a perfect storm – the shippers’ views align with theirs and together they can put sufficient pressure on the forwarders to make the required changes. The simple truth is that these two innovations are easily achievable; technology is no longer the barrier – just the mind-set is. Just achieving these goals in the developed world as a first step would still be a significant step forward. If the passion during the conference is any indication then perhaps change is in the air!

What do you think?

Consider how many retail workers might spend a typical night off the clock. Many are likely to invite friends to dinner via text message or a mobile Facebook post. They may decide which restaurant to visit using Yelp, make reservations online via OpenTable, check in upon arrival via Foursquare, and once seated, determine what to order with help from Urbanspoon. During dinner, they may take photos to share on Instagram, write a quick review of the restaurant on Zagat, or even tweet about their meal to all their followers on Twitter.

Unfortunately, when those same individuals clock in for work at their local retail store, more often than not they are forced to disconnect, unplug, and abandon these mobile tools. All too often, bulletin boards in back rooms are used to post schedules for the coming week. Swapping shifts to accommodate unexpected conflicts requires a phone call to the manager. Many workers will punch a paper card, or swipe a card, on a time clock and then look for a manager to receive their shift assignments. At the end of the shift, most of these workers will fill out a paper or electronic form to document the completed tasks, and possibly even write a note to the boss requesting a day off.

The difference between staffers’ lives on the clock and their lives off the clock is both striking and surprising, given the undeniable potential inherent in even the simplest mobile applications to improve productivity, efficiency, and employee satisfaction. This issue is further magnified when one considers the amount of time sales associates spend off the floor (and out of sight for customers) when they are bound to back-room time clocks, bulletin boards and work logs. And shoppers give retailers very little margin for error when it comes to accessible and available sales associates: a recent white paper by Empathica found 75 percent of shoppers will walk out of the store if they don’t have access to knowledgeable associates.

The good news is retailers recognize the potential benefits of a mobilized staff, and they are beginning to act. A December 2012 study by Retail Systems Research entitled “WFM 2013: The Store Employee in the Customer Age,” found that 67 percent of retailers surveyed either have implemented or have plans to implement mobile workforce technology to assist the sales process.

While these reports are encouraging, we decided to take the research one step further and investigate whether retailers are ready to put their money where their mouth is by investing more in mobility.  If the results from JDA’s recent “Retail Workforce Mobility Snapshot” survey are any indication of retailers’ intent, I’m guessing that by this time next year we will be referring to 2013 as the year of the mobile associate.

Click through the slides below to see a few highlights from JDA’s “Retail Workforce Mobility Snapshot” survey and let us know if you expect similar workforce mobility initiatives at your organization.

For additional insights from thought leaders around the industry on how companies are empowering their employees and creating more satisfied customers through advancements in workforce management, visit JDA Workforce 20/20.

This year’s event takes place at the Orlando World Center Marriott Resort and Convention Center in Orlando, Florida and includes an impressive General Session speaker lineup, featuring Rudy Giuliani 107^th Mayor of New York City,  and author, inventor and futurist Ray Kurzweil, among others.

To help kick things off before the event, JDA is conducting a Twitter contest to test your JDA eight knowledge and give you a chance to win $25 gift cards in the process. The contest runs from April 22 to May 3, 2013. Simply follow @JDASoftware on Twitter and use the #JDAFOCUS13 hashtag to share your answers to our daily questions for a chance to win. One lucky winner will be chosen at 5 p.m. PT every Friday and announced publicly from the @JDASoftware handle. You can find the contest’s Official Rules here.

To make sure you are keeping up with all the latest announcements and fun during FOCUS, follow us on Twitter, Facebook and YouTube where we will be updating our followers with photos, event information, conference video highlights and much more.

There is still time for you to register and be a part of the industry’s premier supply chain event of the year. Visit www.jda.com/focus to register today!

With all that FOCUS has to offer – from learning, to networking, to entertainment – how do attendees and their organizations derive the most value from the time and resources committed to attending?

Below I’ve outlined the top five advantages I believe my peers and their organizations can gain from attending FOCUS and other vendor user conferences. You can:

• Increase your product knowledge of implemented solutions to maximize the value your organization receives from its technology investment; while also learning about product enhancements that are on the horizon.
• Influence product direction by joining a Special Interest Group (SIG) and participating in SIG meetings at the user conference. SIG involvement also allows you to make valuable industry connections that extend beyond the event.
• Schedule an Ask-the-Expert session with solutions and services experts to receive recommendations on how to address your company’s specific business needs.
• Research and evaluate complementary technologies and resources from alliance partners exhibiting at the event.
• Hear success stories from vendor customers and apply the lessons they’ve learned, and best practices discussed, to the benefit of your organization.

As important as these are, I believe one of the greatest benefits of user conferences is the opportunity to network. You can never have enough mentors to help you on your professional journey, and events like FOCUS are ideal for connecting with others who have experienced many of the same challenges you have. Through the years I’ve encountered dozens of professionals who have been generous with their time and counsel – not just at the event, but long after I leave. When I needed a boost or was looking for new ways to gain even greater value from my JDA solutions, I’ve been able to connect with other users and get just what I needed to move my project – and sometimes my career – in the right direction, and now often times I get the opportunity to help others do the same.

Have you attended FOCUS or other vendor user conferences in the past? If so, what aspects of the event translated to the most value for you and your organization?