An improving economy and a strong lineup of speakers and presentation topics drew more than 3,100 supply chain professionals to this year's Annual Global Conference in Philadelphia, Pennsylvania, USA. Participants enjoyed three days of educational seminars along with the "Supply Chain of the Future" exhibition, which showcased cutting-edge supply chain technology, equipment, and services.
Not able to go to the conference this year or unable to get to all of the sessions you would have liked to attend? The following roundup of some of the conference's sessions and events will help you fill in some of those gaps.
For additional information on this year's Annual Global Conference as well as the upcoming 2012 conference (which will take place from September 30-October 3 in Atlanta, Georgia, USA) visit the conference's website: cscmpconference.org.
CSCMP bestows awards for excellence
CSCMP recognized a number of special achievements at the Annual Global Conference. Here is a brief rundown of the awards that were presented for excellence in business and academics.
The 2011 Distinguished Service Award was presented to Dr. James R. Stock, Frank Harvey Endowed Professor of Marketing, University of South Florida. Stock has left a profound mark on the field through teaching, mentoring students, authoring textbooks, conducting research, editing journals, and educating supply chain professionals. (For more about Dr. Stock, see "Dialogue".)
Haritha Metta received the Doctoral Dissertation Award for her paper "A Multi-Stage Decision-Support Model for Coordinated Sustainable Product and SC Design." Metta is currently the revenue management science analyst for Carnival Cruise Lines.
David Graham Hyatt of the University of Arkansas and Nicholas Berente of the University of Georgia received the E. Grosvenor Plowman Award for their paper "Proactive Environmental Strategies in the Supply Chain: An Exploration of the Effects of Cross-Sector Partnerships." The Plowman Award is given to the best research paper presented at CSCMP's Supply Chain Management Educators' Conference.
The Bernard J. La Londe Best Paper Award was given to R. Glenn Richey, Anthony S. Roath, Judith M. Whipple, and Stanley E. Fawcett for "Exploring a Governance Theory of Supply Chain Management: Barriers and Facilitators to Integration." The La Londe Award is presented for the most valuable paper in the Journal of Business Logistics.
Ahold USA, Del Monte, and ES3 LLC received the Supply Chain Innovation Award for their collaborative direct-to-store program. The program created a shared, collaborative warehouse for manufacturers and retailers, which helped to reduce costs and carbon usage, improve speed to shelf, and increase on-shelf availability of product.
New board officers announced
In addition to being an educational event, CSCMP's Annual Global Conference also serves as the association's annual business meeting. As part of those proceedings, members elected the following officers to its board of directors:
Board of Directors Chair: Nancy W. Nix, executive director of the EMBA Program and professor of supply chain practice at the Neeley School of Business, Texas Christian University
Immediate Past Chair: Keith Turner, vice president marketing and sales, Alcoa World Alumina, ALCOA
Board Chair-elect: Rick J. Jackson, executive vice president, Mast Global Logistics Inc., a subsidiary of Limited Brands Inc.
Board Vice Chair: Heather L. Sheehan, vice president, indirect sourcing and logistics, Danaher Corp.
Secretary and Treasurer: Ted Stank, Bruce Chair in Logistics at The University of Tennessee
Here are summaries of just three of the nearly 200 educational sessions that sparked interest at the annual conference. CSCMP members can learn more about these and other sessions by downloading the presentation slides from CSCMP's website. Slides are available at the "2011 Session Presentations" section under the "Educational Events" tab. A member login is required.
Panel offers talent-development tips
When it comes to finding, developing, and retaining supply chain talent, managers have plenty to worry about, as attendees at the "Talent Crisis in Supply Chain Management" session made clear.
But moderator and executive search consultant Timothy Stratman and panelists Ty Gent of Pepsico, Rebecca Lyons of Johnson & Johnson, Jarrod Goentzel of the Massachusetts Institute of Technology, and Stewart Lumsden of the search firm Spencer Stuart were able to offer a host of suggestions and helpful ideas to the standing-room-only crowd.
Just a few of their recommendations:
Companies should look for the following characteristics in their supply chain managers: the ability to drive change and build an effective organization, a global perspective, "commercial sense," problem-solving skills, and the ability to innovate.
Today's young, entry-level employees tend to feel entitled when it comes to salary and perks. Telling them they have to "pay their dues" will not get you far. Give them challenges and opportunities to make concrete contributions that make a difference to the company, its customers, and society at large, and both employer and employee will benefit.
A supply chain or logistics degree is helpful, but you can also hire bright people who have a broad business understanding and leadership skills, and then teach them about warehousing, transportation, inventory, and so on. "We can teach you about supply chain. We want to know what you're going to do with it," said Gent.
Rotate trainees and rising stars through different functional areas. That way they'll find out what interests them most, and you'll learn where their talents lie. Help them understand that lateral moves through various supply chain functions rather than constant promotions will pay off later when they oversee a wider range of functional areas.
Getting to "one version of the truth"
It seems clear enough that all parts of a business ought to work toward the same goals. But supply chain professionals have long struggled with cross-functional collaboration and making decisions that benefit the entire supply chain.
In a session titled "A New Supply Chain Paradigm," executives from the sporting goods manufacturer and distributor Easton-Bell Sports and the pharmaceutical and medical device maker Hospira discussed their efforts to use a relatively new set of data tools to help their companies develop a common basis for decision making.
Both companies are using a set of software tools to gather and analyze company data that will offer what the tool's developer, Competitive Insights, calls "one version of the truth."
This "one version of the truth" can be especially helpful for companies such as Easton-Bell Sports, which consists of different brands, including Easton, Bell, Giro, and Riddell. To make decisions across these multiple businesses, the company needed to be able to manage substantial amounts of data—especially because it has a large number of stock-keeping units (SKUs) and a wide range of customers, according to B. Lewis Hornsby III, vice president, global logistics/fulfillment. By persuading multiple functions to use the same sets of data, Easton-Bell has helped to get all parts of the company "on the same page," Hornsby said. As a result, there is less debate over such things as managing SKU obsolescence.
Similarly, Hospira had historically struggled with getting data out of its network, according to James Hardy, senior vice president of operations. "We had the data in many systems," he said. "Production management, sales, and warehouse management [data] were all in different systems."
By pulling all that data into one system, Hospira gained insight into costs and profitability by product line and customer. "We've learned a lot," Hardy said. "We found some things we thought we were doing well where we were [actually] not doing as well as we should." For example, the data analysis showed that if one channel fulfilled orders once a week instead of three times a week, the company could save $3 million a year.
Chiquita's "Undercover Boss" inspired by supply chain experience
When Fernando Aguirre, Chairman and CEO of Chiquita Brands International, walked out on stage for his presentation at CSCMP's Annual Global Conference, he was pulling a pallet jack loaded with boxes of bananas. He then proceeded to demonstrate, to appreciative laughter, that he knew how to operate the equipment.
That set the tone for an interesting and inspiring speech by the executive, who rose from modest circumstances in Mexico to eventually head the giant produce grower and seller. Aguirre told his life story, including how his parents, mentors, and managers influenced the course of his career. He also peppered the presentation with scenes from his experience on the television show "Undercover Boss," including stints harvesting lettuce, driving a forklift in a warehouse, and working with an import coordinator at one of Chiquita's offices. Aguirre's personal experience with supply chain operations and the people who make them work proved to be "life-changing and inspirational" and influenced some of the changes he has implemented at the company, he said.
He also talked about his leadership philosophy, "LEAD"—learn, execute, adapt, and direct—and how a company's success depends on the "passion and commitment" of employees. Aguirre arrived at Chiquita six years ago, tasked with rescuing the company from bankruptcy. He quickly recognized that company employees lacked a sense of purpose and commitment. In response, he instituted a corporate mission to improve nutrition worldwide, as well as programs to recognize individual and team contributions, improve productivity, and open up direct communication between employees at all levels worldwide.
Go "Pro" with new certification program
CSCMP unveiled its new SCPro professional certification program in supply chain management at the Annual Global Conference. The program provides global supply chain professionals with a way to demonstrate their skill level and mastery of end-toend supply chain functions.
The program consists of three levels:
Level One: Cornerstones of Supply Chain Management. SCPro Level One covers the entire end-to-end supply chain with a focus on building customer relationships. This level is open to candidates who have either a bachelor's degree or four years of relevant experience.
Level Two: Analysis and Application of Supply Chain Challenges. This level tests a candidate's ability to thoughtfully analyze real-world case studies and formulate supply chain solutions that improve the supply chain in both the short and the long term.
Level Three: Implementation of Supply Chain Transformation. The highest SCPro designation requires the candidate to apply practical supply chain skills through an independent project. It marks the candidate as a leader who is valuable not only within his or her organization but also to the profession as a whole.
"The certification will enable professionals to demonstrate to their employers that they are the kind of leaders who will positively impact their organizations' bottom lines," said Judy Schieve, manager of certification programs. "When a candidate completes all three levels of the program, he or she will also have a portfolio of work to augment the professional experience."
Companies in every sector are converting assets from fossil fuel to electric power in their push to reach net-zero energy targets and to reduce costs along the way, but to truly accelerate those efforts, they also need to improve electric energy efficiency, according to a study from technology consulting firm ABI Research.
In fact, boosting that efficiency could contribute fully 25% of the emissions reductions needed to reach net zero. And the pursuit of that goal will drive aggregated global investments in energy efficiency technologies to grow from $106 Billion in 2024 to $153 Billion in 2030, ABI said today in a report titled “The Role of Energy Efficiency in Reaching Net Zero Targets for Enterprises and Industries.”
ABI’s report divided the range of energy-efficiency-enhancing technologies and equipment into three industrial categories:
Commercial Buildings – Network Lighting Control (NLC) and occupancy sensing for automated lighting and heating; Artificial Intelligence (AI)-based energy management; heat-pumps and energy-efficient HVAC equipment; insulation technologies
Manufacturing Plants – Energy digital twins, factory automation, manufacturing process design and optimization software (PLM, MES, simulation); Electric Arc Furnaces (EAFs); energy efficient electric motors (compressors, fans, pumps)
“Both the International Energy Agency (IEA) and the United Nations Climate Change Conference (COP) continue to insist on the importance of energy efficiency,” Dominique Bonte, VP of End Markets and Verticals at ABI Research, said in a release. “At COP 29 in Dubai, it was agreed to commit to collectively double the global average annual rate of energy efficiency improvements from around 2% to over 4% every year until 2030, following recommendations from the IEA. This complements the EU’s Energy Efficiency First (EE1) Framework and the U.S. 2022 Inflation Reduction Act in which US$86 billion was earmarked for energy efficiency actions.”
Economic activity in the logistics industry expanded in November, continuing a steady growth pattern that began earlier this year and signaling a return to seasonality after several years of fluctuating conditions, according to the latest Logistics Managers’ Index report (LMI), released today.
The November LMI registered 58.4, down slightly from October’s reading of 58.9, which was the highest level in two years. The LMI is a monthly gauge of business conditions across warehousing and logistics markets; a reading above 50 indicates growth and a reading below 50 indicates contraction.
“The overall index has been very consistent in the past three months, with readings of 58.6, 58.9, and 58.4,” LMI analyst Zac Rogers, associate professor of supply chain management at Colorado State University, wrote in the November LMI report. “This plateau is slightly higher than a similar plateau of consistency earlier in the year when May to August saw four readings between 55.3 and 56.4. Seasonally speaking, it is consistent that this later year run of readings would be the highest all year.”
Separately, Rogers said the end-of-year growth reflects the return to a healthy holiday peak, which started when inventory levels expanded in late summer and early fall as retailers began stocking up to meet consumer demand. Pandemic-driven shifts in consumer buying behavior, inflation, and economic uncertainty contributed to volatile peak season conditions over the past four years, with the LMI swinging from record-high growth in late 2020 and 2021 to slower growth in 2022 and contraction in 2023.
“The LMI contracted at this time a year ago, so basically [there was] no peak season,” Rogers said, citing inflation as a drag on demand. “To have a normal November … [really] for the first time in five years, justifies what we’ve seen all these companies doing—building up inventory in a sustainable, seasonal way.
“Based on what we’re seeing, a lot of supply chains called it right and were ready for healthy holiday season, so far.”
The LMI has remained in the mid to high 50s range since January—with the exception of April, when the index dipped to 52.9—signaling strong and consistent demand for warehousing and transportation services.
The LMI is a monthly survey of logistics managers from across the country. It tracks industry growth overall and across eight areas: inventory levels and costs; warehousing capacity, utilization, and prices; and transportation capacity, utilization, and prices. The report is released monthly by researchers from Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, in conjunction with the Council of Supply Chain Management Professionals (CSCMP).
"After several years of mitigating inflation, disruption, supply shocks, conflicts, and uncertainty, we are currently in a relative period of calm," John Paitek, vice president, GEP, said in a release. "But it is very much the calm before the coming storm. This report provides procurement and supply chain leaders with a prescriptive guide to weathering the gale force headwinds of protectionism, tariffs, trade wars, regulatory pressures, uncertainty, and the AI revolution that we will face in 2025."
A report from the company released today offers predictions and strategies for the upcoming year, organized into six major predictions in GEP’s “Outlook 2025: Procurement & Supply Chain.”
Advanced AI agents will play a key role in demand forecasting, risk monitoring, and supply chain optimization, shifting procurement's mandate from tactical to strategic. Companies should invest in the technology now to to streamline processes and enhance decision-making.
Expanded value metrics will drive decisions, as success will be measured by resilience, sustainability, and compliance… not just cost efficiency. Companies should communicate value beyond cost savings to stakeholders, and develop new KPIs.
Increasing regulatory demands will necessitate heightened supply chain transparency and accountability. So companies should strengthen supplier audits, adopt ESG tracking tools, and integrate compliance into strategic procurement decisions.
Widening tariffs and trade restrictions will force companies to reassess total cost of ownership (TCO) metrics to include geopolitical and environmental risks, as nearshoring and friendshoring attempt to balance resilience with cost.
Rising energy costs and regulatory demands will accelerate the shift to sustainable operations, pushing companies to invest in renewable energy and redesign supply chains to align with ESG commitments.
New tariffs could drive prices higher, just as inflation has come under control and interest rates are returning to near-zero levels. That means companies must continue to secure cost savings as their primary responsibility.
Specifically, 48% of respondents identified rising tariffs and trade barriers as their top concern, followed by supply chain disruptions at 45% and geopolitical instability at 41%. Moreover, tariffs and trade barriers ranked as the priority issue regardless of company size, as respondents at companies with less than 250 employees, 251-500, 501-1,000, 1,001-50,000 and 50,000+ employees all cited it as the most significant issue they are currently facing.
“Evolving tariffs and trade policies are one of a number of complex issues requiring organizations to build more resilience into their supply chains through compliance, technology and strategic planning,” Jackson Wood, Director, Industry Strategy at Descartes, said in a release. “With the potential for the incoming U.S. administration to impose new and additional tariffs on a wide variety of goods and countries of origin, U.S. importers may need to significantly re-engineer their sourcing strategies to mitigate potentially higher costs.”
Freight transportation providers and maritime port operators are bracing for rough business impacts if the incoming Trump Administration follows through on its pledge to impose a 25% tariff on Mexico and Canada and an additional 10% tariff on China, analysts say.
Industry contacts say they fear that such heavy fees could prompt importers to “pull forward” a massive surge of goods before the new administration is seated on January 20, and then quickly cut back again once the hefty new fees are instituted, according to a report from TD Cowen.
As a measure of the potential economic impact of that uncertain scenario, transport company stocks were mostly trading down yesterday following Donald Trump’s social media post on Monday night announcing the proposed new policy, TD Cowen said in a note to investors.
But an alternative impact of the tariff jump could be that it doesn’t happen at all, but is merely a threat intended to force other nations to the table to strike new deals on trade, immigration, or drug smuggling. “Trump is perfectly comfortable being a policy paradox and pushing competing policies (and people); this ‘chaos premium’ only increases his leverage in negotiations,” the firm said.
However, if that truly is the new administration’s strategy, it could backfire by sparking a tit-for-tat trade war that includes retaliatory tariffs by other countries on U.S. exports, other analysts said. “The additional tariffs on China that the incoming US administration plans to impose will add to restrictions on China-made products, driving up their prices and fueling an already-under-way surge in efforts to beat the tariffs by importing products before the inauguration,” Andrei Quinn-Barabanov, Senior Director – Supplier Risk Management solutions at Moody’s, said in a statement. “The Mexico and Canada tariffs may be an invitation to negotiations with the U.S. on immigration and other issues. If implemented, they would also be challenging to maintain, because the two nations can threaten the U.S. with significant retaliation and because of a likely pressure from the American business community that would be greatly affected by the costs and supply chain obstacles resulting from the tariffs.”
New tariffs could also damage sensitive supply chains by triggering unintended consequences, according to a report by Matt Lekstutis, Director at Efficio, a global procurement and supply chain procurement consultancy. “While ultimate tariff policy will likely be implemented to achieve specific US re-industrialization and other political objectives, the responses of various nations, companies and trading partners is not easily predicted and companies that even have little or no exposure to Mexico, China or Canada could be impacted. New tariffs may disrupt supply chains dependent on just in time deliveries as they adjust to new trade flows. This could affect all industries dependent on distribution and logistics providers and result in supply shortages,” Lekstutis said.