the glass supply chain - beyond visibilityte ct group: the glass supply chain - beyond visibility 1...

1THE CENTRAL GROUP: The Glass Supply Chain - Beyond Visibility

The Glass Supply Chain - Beyond Visibility

The best supply chains aren’t just fast and cost-effec-tive. They must be designed in a way that leverages technology to allow full visibility. Knowledge is most powerful when it is shared in an environment that pro-motes collaboration. If you want a supply chain that is agile and adaptable, make sure that all your processes are anchored to a positive customer experience. Too often, companies limit their view of their supply chain and in doing so limit their customer experience. If you want to create a demand driven supply chain you need to give credence to the flow of information. Flow can happen if you have full access to information that re-sults in one version of the truth.

Revolutions begin long before they are officially de-clared. For many years businesses have been strug-gling with how to increase profits through productivity and have concluded that new strategies and competi-tive realities demand new skills, processes, and tech-nologies. The days of driving market share through price and promotion are over, as consumers today want the fountain of youth at a discount. Reacting to your customers’ current needs is not enough, as you must understand the evolution of your customers’ re-quirements over time. In order to do this you must

The Glass Supply Chain – Beyond VisibilityBy Inez Blackburn



understand what motivates them to buy and what drives them to tears. Accurately forecasting demand requires knowledge of key influences at the point of purchase, as well as social, psychological, and situ-ational forces. But don’t limit your focus to the de-mand forecast, as your merchandising and promo-tion plan must be factored into to your supply chain strategy. We have hit the tipping point of consumer segmentation models. You can no longer group con-sumers by income and size of household. For an ac-curate snapshot of preference you must now group customers by what motivates them to buy and what is important to them. The current economy has cre-ated new groups of consumers who I will refer to as the “consumer of postponement”. These are the con-sumers whose wealth has been devastated by the current economy, and who will focus on necessities and postpone indulgent purchases. Unfortunately, frivolous buying behavior and the propensity for in-dulgence has been replaced by buying behavior fu-eled by survival, relevance, and sustainability. How will these evolving consumer models influence your supply chain, and when and how do you factor in your demand signals? Consumers globally are high-ly emotional and customer service has never been more important. Upsetting consumers today will have far-reaching, dire consequences. How long will your consumer tolerate an out of stock and what will you lose? Will the out of stock result in the lost sale of a product or the loss of a preferred consumer?

Forecasting demand has therefore evolved in to a collaborative and complex process that draws from disparate data sets and economic indicators that are more focused on the consumer moods, attitudes, and behaviors rather than demographic segmentation. Forecast accuracy will be dictated by understanding not only what you sold, but also what you should have or could have sold. How you integrate and le-verage demand signals across your supply chain can define how responsive you are to consumer demand.

Trends to consider and opportunities they create!

• What do baby boomers want? – The fountain of youth at a discount!

• What do teenagers want? – They want more value and someone else to pay for their pur-chase!

• The want to be different and fit in at the same time.

• What are Teenagers called? – Generation “text.”

Current economic conditions have forced companies

to accept the fact that the current cost structures of their companies are changing. The need for sustain-ability from the environmental, structural, and envi-ronmental perspectives is a growing concern due to volatility in economic indicators, the price of oil and commodities. Supply chain management also has a significant and lasting impact on cash flow and cus-tomer satisfaction. Efficient execution of core pro-cesses can be a significant and sustainable advan-tage. Reducing your global footprint is also a growingconcern as companies struggle to manufacture clos-er to consumption. Reducing invested capital in in-ventories will require synchronization and collabora-tion with respect to sourcing and distribution of raw materials. Connecting business information and cre-ating a stronger flow of information that allows full visibility will enable the correct action. The luxury of ignorance has expired and a failure to understand what is going on across your supply chain is no lon-ger an excuse.

Building bridges of relevant, accurate, and timely data will create trust as well as introduce higher lev-els of accountability. Suppliers must be perceived as partners in the true sense of collaboration with infor-mation flowing in both directions. New performance metrics and scorecards will emerge that create stronger links between customer expectations and supplier capabilities. Volatility in demand and disrup-tions must be managed by proactive visibility acrossthe supply chain. Trading partners must learn to lead through inspiration rather than force as they both face the same financial challenges and bottlenecks.

Supply chain efficiency should be addressed daily in order to achieve synchronized and efficient process-es. All departments must play a role in the success of your supply chain and mechanisms should be put in place to create a culture of collaboration and co-operation.

The ability to capture and store information dates back many decades, but the ability to send, interpret and leverage information in real time through col-laboration, is truly a revolution. Michael Dertouzos, a leading expert on information technology, believes that stores of the future will not carry a single prod-uct, but rather possess multiple cubicles outfitted with:

• A large video screen

• A small tabletop which has a keyboard and a mouse

• A few chairs

• A microphone system that records speech



• Special goggles

• Some neatly instrumented gloves.

Consumers shopping for clothes will stand in the front of a 3-D scanner that will take their measure-ments and then project an image of what each item will look like on the subject in question. Consum-ers of the future will select items from an electronic catalogue as if they were looking in a mirror. Con-sumers will also reap the rewards of more efficient global supply chains, as retailers continue to source products from around the world.

During the past 15 years, leading companies that focused on building and rebuilding supply chains to deliver goods and services to consumers as quickly and inexpensively as possible have realized varying degrees of success. Firms that invested in state-of-the-art technologies often proved to be inadequate, which lead to the hiring of top notch talent. Many companies also teamed up to streamline processes, lay down technical standards, and invest in infra-structure they could share. For instance, in the early 1990s, American apparel companies started a Quick Response initiative, grocery companies in Europe and the United States touted a program called Ef-ficient Consumer Response, and the U.S. food ser-vice industry embarked on an Efficient Foodservice Response program.

Interestingly, there is one fundamental problem that most companies and experts continuously ignore: Ceteris paribus, companies whose supply chains be-came more efficient and cost effective often didn’t gain a sustainable advantage over their rivals. In fact, the performance of those supply chains steadi-ly deteriorated. For instance, despite the increased efficiency of many companies’ supply chains, the percentage of products that were marked down in the United States rose from less than 10% in 1980 to more than 30% in 2008, and surveys show that consumer satisfaction with product availability fell sharply during the same period. Selling products ef-ficiently across your supply chain without a measur-able improvement on customer satisfaction will not result in a competitive advantage or a demand-driv-en supply chain.

Top-performing supply chains possess six unique qualities:

• They are fully visible and data is connected and converted to knowledge on a timely basis.

• Demand driven supply chains create an environ-ment of trust by deploying processes that are

• Compatible with your trading partners.

• Great supply chains are agile and are fueled by demand-driven models that react speedily to

• Sudden changes in demand or supply.

• They adapt over time as market structures, technologies, and strategies evolve while lever-aging their core competencies.

• They align the interests of all the firms in the supply network so that companies optimize the

• Chain’s performance when they maximize indi-vidual interests.

• They result in a stronger value proposition for their customers at a reduced cost through more

• Efficient deployment of resources.

• They promote an environment of trust through effective collaboration and cooperation on key

• Processes, and promote visibility.

ConclusionOnly supply chains that are fully visible, collabora-tive, agile, adaptable, and aligned provide compa-nies with sustainable competitive advantage and excellence in customer service. You cannot manage what you cannot see! The more accurate and timely the flow of information, the faster your response in managing disruptions. Education and training must be combined with understanding, coordination, and cooperation across the supply chain in order to lever-age the combined strength of your most valuable as-sets … your people and the information they dependon.



About the AuthorInez Blackburn is a globally recognized speaker and industry leader, innovator and pioneer in launching global brands with over 25 years’ experience. She has worked with many Fortune 500 companies and led numerous executives through her Positioned for Profit Seminars and Marketing to the Max Workshops. She has been on the Dean’s list for excellence in teaching for 10 years and is a featured trainer at numerous executive events. Her first book Pride Pas-sion Profit – 7 Steps to Category Development has sold over 5,000 copies and is well posi-tioned to help companies take their category plans to the next level.

Inez Blackburn is currently the Director of Research at The Institute for Retail Innovation and Education (The Central Group) and an Adjunct professor at the University of Toronto, Wright State University, and S.P. Jain University in Singapore and Dubai. Inez conducts both quantitative and qualitative research in a State of the Art Research facility and ROI Lab leveraging best in class technologies and research protocols.

Prior to becoming addicted to research and an Adjunct Professor, Inez held numerous executive positions for numerous CPG Companies for National Brands and Private Label. She was the Vice President of Marketing for Cott Corporation where she was responsible for developing and launching Private Label Brands for major retailers in Canada, the United States and Europe. Inez also held progressive positions at Nabisco, Robin Hood Multifoods, Red Lobster Canada and for those of you who remember Consumers Distributing.

The Central Group is an award winning marketing at retail company sepcializing in packag-ing & display. We offer innovation that goes beyond the confines of packaging and merchan-dising towards a total marketing solution at retail. The Central Group doesn’t just read about the next trend in shopper insights or retail technology. We search the world for what’s new and what’s next and validate our solutions in our ROILab* creating the perfect balance between a Retail Environment, Emerging Technologies and Shopper Insights.

The Institute for Retail Innovation and Education is a research and education knowledge bank created to bridge the gap between marketing-at-retail theory and practice. The Institute is an industry focused research and education facility with strategic alliances with academia and industry leaders. We are committed to research and education programs that will chal-lenge, inspire and create a valuable opportunity to unlock the key drivers of marketing at retail innovation.

*ROILabTM is our state of the art research facility where clients and our in–house design teams develop innovations in packaging, merchandising, display and technology

the glass supply chain - beyond visibilityte ct group: the glass supply chain - beyond visibility 1...

Documents