It has been a year since I have written a blog. In the meantime, I’ve had the opportunity to create two books – one in Vietnamese and one in English, titled: The Supply Chain Optimization Field Guide. Both of largely capture the essence of last year’s blogs into a concise handbook for managers on how to run a global supply chain. My thought for writing these books was to heed Mr. Toyoda’s instructions, for me to teach the next generation of supply chain professional, everything I have learned throughout my career.
Over the past 40 years, was I was transformed from being a US focused manager into a foot soldier in the whole globalization phenomenon. As I started my career in 1979, operating a teletype machine at Union Pacific Railroad, I would have never guessed that I would have achieved the success I have today. I was lucky enough to have been taught by some of the true masters of industry, and got to experience, first hand many of the events over the past four decades. So what did I learn during this time?
- At Union Pacific, I learned how to literally run the railroad. My lessons revolved around safety, labor, and how to operate in a very time-defined environment.
- At Toyota, my sensei’s taught me how to think. I learned how to be world class, keep cars moving, maintain factory-fresh quality, and promote efficiency. Here too, I discovered such skills as being a servant leader, running with zero defects and Kaizen (or continuous improvement). I thrived in this environment and it was a great personal growth experience for me.
- At Deere, I discovered how a corporate culture really works. Older American companies operate in a completely different fashion than a centralized Japanese structure, so change management became part of my vocabulary. I learned from another master, Dave Nelson, about the mechanics of sourcing and was given tremendous responsibilities. I was also very naïve at this point and thought everyone would be on the same page as me, following instructions from our leaders. What I failed to understand though was that corporate cultures have many agendas – not everyone is willing to change to meet my ideas of improvement.
Honeywell was a completely different culture to work in. I used to laugh:
At Toyota I would tell someone to do something and they had to do it; at John Deere I would tell someone to do something and they’d think about doing it; and at Honeywell, I’d tell someone to do something and they’d think of 900 reasons why not to do it.
Here, I had an ‘influencing role’ that was probably the hardest job of my career. This position was ever changing with 80+ Acquisitions, loaded with ambiguity, supporting operations in 164 countries, with over 2 million ‘ship to’ addresses and 110 ERP systems. We were open for business, 24/7, with someone always doing something (oftentimes not necessarily for the good).
Today, I continue to learn and find new experiences in new places in the world. I love being a global supply chain manager and will always be here for you or your organization.
Moving to New Horizons – Part I
(Teaching an old dog new tricks)
As part of my duties at Portland State University, over the summer, I have the opportunity to take Masters Students to Vietnam and China to learn supply chain. This year, along with my colleague Daniel Wong, we spent over two weeks in Saigon and Hanoi, Vietnam as well as Chengdu China. I love these trips as it provides the opportunity to see many areas from a new point of view. In these distant lands, we try to spend an equal amount of time, learning the cultural and everyday aspects of life as we do on studying business. As a global manager, in order to be successful in my business endeavors, I found this a basic requirement to understand what drives a culture I’m working in.
This year, in Vietnam, we visited companies such as Wahl Clipper, Duytan Plastics, Becamex, VSIP, Lazada & DHL ecommerce operations, ‘emergent’ cold storage, Samsung Electronics, Ford Motor and Nike. A wonderful mix of companies, ranging in products and functional expertise with the opportunity to see truly world class operations at Samsung and Nike.
In China, we went to Chengdu. While most people may know this as the home of the panda bear, I learned that when the China government, proclaimed “go west” it was all about coming here (as this is the starting point of the economic strategy of “One Belt, One Road). I was totally in awe of how much investment China has made into promoting the growth of technology throughout the country. They are a force to be reckoned with, that we in the west must wake up and recognize.
Unlike last year, there were no typhoons for us to cope with, only one of the students bitten by a wild monkey (which required him to get rabies shots along the way). This was another magnificent experience that everyone will remember for their lifetime.
Moving to New Horizons – Part II
(Teaching at a Supply Chain Seminar in Vietnam)
Prior to going with the students to Hanoi In August, I agreed to participate in a seminar on Supply Chain. I brought my colleague Daniel Wong along to provide lots of knowledge. The agenda consisted of:
SESSION 1: SUPPLY CHAIN MANAGEMENT
NEW CONTEXT & INDUSTRIAL REVOLUTION 4.0
SESSION 2: SUPPLY CHAIN OPTIMIZATION & COMPETITIVE STRATEGY FOR ENTERPRISES
Jay and Daniel to talk about how the above topics with the reality of running a global supply chain
Before we left home, I read a Harvard Business Review article about The Death of Supply Chain Management. In this world, forecasting is perfect, machines have no operators and Block Chain drives it all. After chuckling about the absurdity of the article, I sat down to begin to write our presentation.
First though, I had to learn exactly what Industry 4.0 actually is. After reading many articles from McKinsey, Daniel and I sat in a conference room at PSU and developed a picture, for us to grasp exactly what these exultant consultants were trying to push on industry. Then it dawned on me – it is like having an all-powerful ERP, on steroids, dropped into your business (whether you needed one or not). I knew that every ‘C Suite’ will want one of their very own. And, similar to an ERP implementation – you’ll literally pay billions and get absolutely nothing, if you don’t take the time to make sure that the basics are well taken care of.
Philosophically, it dawned on us that this should be like a beehive. The shape of each cell is such that two opposing honeycomb layers have to nest onto each other, with each facet of the closed ends being shared by opposing cells to give them strength.
- The core honeycomb are the basic competencies you need to operate a supply chain
All businesses need to be able to: Plan, Source, Make and Deliver a product. These are the essential task that have to be done for entry into any market - The outer hexagons are the competencies you need to run a business
As a business matures, it needs to be able to take care of its people, have a business strategy, develop and plan a supply chain, manage its risk, cross borders, account for its financial activity, among other things - The rectangles are the disruptive forces and the future competencies that will be needed
Once the inner processes are standardized, then, and only then can you turn your attention to Big Data & Analytics, Digital Tech, IoT and Industry 4.0
To us, this picture represented hope and prosperity (as opposed to futility of, just another system implementation). See, no matter what consultants say (especially those that have never actually done anything), supply chains will still be complex and messy. Customers will still be suppliers, plants will always feed each other and return goods will need to travel back to their origin. The dynamics of a supply chain will continually be changing: suppliers are added, investments will made in new plants, regulations will increase, logistics costs will rise and customers will change. And, with the increase in international trade and cross-border requirements, the supply chain has be increasingly central to the management of cash. Oh, and by the way, there is no such thing as a system generated forecast that has any value. People still have to do all of the work to achieve this.
While at first I really struggled with the topics of this seminar, after listening to the speakers, I gained an appreciation for what the next generation supply chain professionals will have to contend with. As I learned many years ago, systems are not the silver bullet as they do not foresee events, they only provide calculations from the data they are fed. Mr. Toyoda use to preach to us “you put a computer in a bad operation and you will get a worse one quicker.” It still will all revolve around the People, Process, Tools to run the business.
It was a lot of fun and I truly admire the speakers ahead of us, as they are very deep thinkers. I’m including a link here for this seminar if you are interested in sharing this experience.
In the months ahead, we’ll be doing a series of these throughout Vietnam, ranging in topics – so will be coming to a city near you, soon.
In closing, I’m glad to be back writing again. If there if a topic you’d like me to delve into, please don’t hesitate to ask me at: jay@jayfortenberry.com