HBR: The Death of Supply Chain Management

What’s going to happen with the building supply chain? Are you keeping up with technology? Are your suppliers keeping you from advancing in the new technology-driven supply chain? Below is a blog from the Harvard Business Review by Allan Lyall, Pierre Mercier, Stefan Gstettner:

The Death of Supply Chain Management

The supply chain is the heart of a company’s operations. To make the best decisions, managers need access to real-time data about their supply chain, but the limitations of legacy technologies can thwart the goal of end-to-end transparency. However, those days may soon be behind us. New digital technologies that have the potential to take over supply chain management entirely are disrupting traditional ways of working. Within 5-10 years, the supply chain function may be obsolete, replaced by a smoothly running, self-regulating utility that optimally manages end-to-end work flows and requires very little human intervention.

With a digital foundation in place, companies can capture, analyze, integrate, easily access, and interpret high quality, real-time data — data that fuels process automation, predictive analytics, artificial intelligence, and robotics, the technologies that will soon take over supply chain management.

Leading companies are already exploring the possibilities. Many have used robotics or artificial intelligence to digitize and automate labor-intensive, repetitive tasks and processes such as purchasing, invoicing, accounts payable, and parts of customer service. Predictive analytics are helping companies improve demand forecasting, so they can reduce or better manage volatility, increase asset utilization, and provide customer convenience at optimized cost.

Sensor data on machine use and maintenance are helping some manufacturers to better estimate when machines will break down, so downtime is minimized. Blockchains are beginning to revolutionize how parties collaborate in flexible supply networks. Robots are improving productivity and margins in retail warehouses and fulfillment centers. Delivery drones and self-driving vehicles aren’t far off. Rio Tinto, the global mining-and-metals company, is exploring how digital technologies can automate mine-to-port operations. Using driverless trains, robotic operators, cameras, lasers, and tracking sensors, the company will be able to manage the whole supply chain remotely — while improving safety and reducing the need for workers in remote locations.

A key concept that many of these companies are exploring is the “digital control tower” — a virtual decision center that provides real-time, end-to-end visibility into global supply chains. For a small number of leading retail companies’ control towers have become the nerve center of their operations. A typical “tower” is actually a physical room staffed with a team of data analysts that works full-time, 24/7, monitoring a wall of high definition screens. The screens provide real-time information and 3D graphics on every step of the supply chain, from order to delivery. Visual alerts warn of inventory shortfalls or process bottlenecks before they happen, so that teams on the front line can course correct quickly before potential problems become actual ones. Real-time data, unquestioned accuracy, relentless customer focus, process excellence, and analytical leadership underlie the control tower operations of these retail operations.

Industrial companies are also embracing the concept. One manufacturer’s complex network moves more than a million parts and components per day. The control tower flags potential supply issues as they arise, calculates the effects of the problem, and either automatically corrects the issue using pre-determined actions or flags it for the escalation team. Similarly, a steel company built a customized scenario-planning tool into its control tower platform that increases supply chain responsiveness and resilience. The tool simulates how major, unexpected equipment breakdowns — so called “big hits” — will affect the business and points to the best risk mitigation actions.

Reskilling implications

The trend is clear: Technology is replacing people in supply chain management — and doing a better job. It’s not hard to imagine a future in which automated processes, data governance, advanced analytics, sensors, robotics, artificial intelligence, and a continual learning loop will minimize the need for humans. But when planning, purchasing, manufacturing, order fulfillment, and logistics are largely automated, what’s left for supply chain professionals?

In the short term, supply chain executives will need to shift their focus from managing people doing mostly repetitive and transactional tasks, to designing and managing information and material flows with a limited set of highly specialized workers. In the near term, supply chain analysts who can analyze data, structure and validate data sets, use digital tools and algorithms, and forecast effectively will be in high demand.

Looking further out, a handful of specialists will be needed to design a technology-driven supply chain engine that seamlessly supports the ever-changing strategy, requirements, and priorities of the business. To keep that engine running, a small number of people must be recruited or trained in new skills at the intersection of operations and technology. Since the skills needed for these new roles are not readily available today, the biggest challenge for companies will be to create a supply chain vision for the future — and a strategy for filling those critical roles.

Clearly, the death of supply chain management as we know it is on the horizon. The managers and companies working to update their skills and processes today are the ones who will come out on top.




Irresistible: The Rise of Addictive Technology and the Business of Keeping Us Hooked by Adam Alter explores behavioral addiction, how it compares to substance addiction and what causes it. There’s a good mix of research and anecdotes in this book. Below is an excerpt from the book that you might find useful:


Gamification is a powerful tool, and like all powerful tools it brings mixed blessings. On the one hand, it infuses mundane or unpleasant experiences with a measure of joy. It gives medical patients respite from pain, schoolkids relief from boredom, and gamers an excuse to donate to the needy. By merely raising the number of good outcomes in the world, gamification has value. It’s a worthwhile alternative to traditional medical care, education, and charitable giving because, in many respects, those approaches are tone-deaf to the drivers of human motivation. But Ian Bogost was also wise to illuminate the dangers of gamification. Games like FarmVille and Kim Kardashian’s Hollywood are designed to exploit human motivation for financial gain. They pit the wielder of gamification in opposition to the gamer, who becomes ensnared in the game’s irresistible net. But, as I mentioned early in this book, tech is not inherently good or bad. The same is true of gamification. Stripped of its faddish popularity and buzzwordy name, the heart of gamification is just an effective way to design experiences. Games just happen to do an excellent job of relieving pain, replacing boredom with joy, and merging fun with generosity.


Why Winner-Take-AII Is Winning

Is the building supply industry going to turn into a winner-take-all market? Do you have a strategy if technology disrupts the distribution of goods and service? The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies by Erik Brynjolfsson and Andrew McAfee

Why Winner-Take-AII Is WinningSecond Machine Age.jpg

Why are winner-take-all markets more common now? Shifts in the technology for production and distribution, particularly these three changes:

  1. the digitization of more and more information, goods, and services,
  2. the vast improvements in telecommunications and, to a lesser extent, transportation, and
  3. the increased importance of networks and standards.

Albert Einstein once said that black holes are where God divided by zero, and that created some strange physics. While the marginal costs of digital goods do not quite approach zero, they are close enough to create some pretty strange economics. As discussed in chapter 3, digital goods have much lower marginal costs of production than physical goods. Bits are cheaper than atoms, not to mention human labor.

Digitization creates winner-take-all markets because, as noted above, with digital goods capacity constraints become increasingly irrelevant. A single producer with a website can, in principle, fill the demand from millions or even billions of customers. Jenna Marbles’s homemade YouTube video “How to trick people into thinking you’re good looking,” to take one wildly successful example, garnered 5.3 million views the week she posted it in July 2010.13 She’s now earned millions of dollars from over one billion viewings of her videos around the world. Every digital app developer, no matter how humble its offices or how small its staff, almost automatically becomes a micro-multinational, reaching global audiences with a speed that would have been inconceivable in the first machine age.

In contrast, the economics of personal services (nursing) or physical work (gardening) are very different, since each provider, no matter how skilled or hard-working, can only fulfill a tiny fraction of the overall market demand. When an activity transitions from the second category to the first the way tax preparation did, the economics shift toward winner-take-all outcomes. What’s more, lowering prices, the traditional refuge for second-tier products, is of little benefit for anyone whose quality is not already at or near the world’s best. Digital goods have enormous economies of scale, giving the market leader a huge cost advantage and room to beat the price of any competitor while still making a good profit.” Once their fixed costs are covered, each marginal unit produced costs very little to deliver.

12 Apps for a Better Life

The following applications and websites can be used to make your job and life better. These are just a few of the applications in the marketplace. I’ve used most of the services listed and may be contacted if you want more information.

Time Management

Pomodoro Technique

Pomodoro Technique is a time management method. The technique uses a timer to break down work into an interval of 25 minutes then take short breaks. This method is based on the idea that a frequent break improves mental agility.


RescueTime is a time tracking application that gives you an accurate picture of how you spend your time on your devices. This application highlights poor usage of your time. It can also set alarms to tell you how much time you spent on Facebook.


Doodle is a cloud-based calendar tool for coordinating meetings. Users are surveyed to determine the best date and time to meet.

Remember the Milk (RTM)

RTM is a cloud-based task and time management. Some of the features are emailing your task to RTM. Also, it can be used to setup tags, locations and integrates with Outlook and Gmail.


IQTell is a cloud-based task and time management application. It utilizes the concepts and techniques designed in GTD by David Allen. This application will sync with emails, Evernote and ICloud.



Slack is a cloud-based team collaboration tool. Slack allows a team or group to communicate on one platform. This platform allows communication without email or group texting.


Dropbox is a file hosting service. Dropbox can be used as a collaboration of files with other users. It’s a good application for sharing large files or photos with others.


Mind Mapping

Mind Mapping is a diagram used to visually organize information. This method is used in brainstorming, memory, visual thinking and problem solving. You can use paper or software to mind map.


IFTTT is a free web-based service that allows users to create chains of simple conditional statements, called “recipes”, which are triggered based on changes to other web services such as Gmail, Slack, Twitter, and Evernote. IFTTT is an abbreviation of “If This Then That”. Here are some of my recipes:

  • If new SMS received from [Phone Number], then post a message to a Slack channel.
  • Email me when the president signs a new law.
  • If the new final score for the Clemson Tigers, then send me an email at [Email].


Evernote is an application that can be used to organize data and list by using notebooks and tags. The application allows users to create text, web pages, photographs, voice memos, or handwritten notes. Also, Evernote has a good search engine inside the application.


Trello is a cloud-based project management system. This uses boards (Projects) and cards (tasks). You can also set up teams for your projects.


Focus@Will is a music based on human neuroscience. It helps you focus, reduce distractions maintaining your productivity, and retaining information when working, writing and reading. This is a paid subscriptions service, but other music services might offer Focus@Will playlists.

The Beginners’ Guide to Evernote

The Beginners’ Guide to Evernote

Evernote is a great application which you can “dump your brain” into so you don’t have to keep important information in your mind.

Think of Evernote as your personal database. You can access it in any web browser as well as an application.

Here are some terms you will need to know about Evernote:

  • Notebooks: These are collections of individual notes. You could just have one notebook and dump everything into it. However, most people establish different notebooks for different areas of focus or they can share notebooks with others. Examples of notebooks I currently use are LBMDF, LDAC, Lobby Day, and Personal.
  • Stacks: These are collections of notebooks. For example, you could have a stack called “Work” that has separate notebooks for each customer, project, or area of responsibility.
  • Tags: These are attributes that you can apply to any individual note. You can then view all notes with a specific tag, regardless of which notebook it resides in. This provides the ultimate in filing flexibility though it can be confusing at times. I set up tags in the following ways: the source of information, author, or a quick description of the note. Some of my tags are education, personal development, managing people, and Excel.


The top six reasons I love Evernote:

  • Customer Relations Management/ Project Management

It can be used is to clip maps to job sites. Archive text messages from customers.  And you can enter field notes and pictures.

  • Checklists

Store checklists that you can use over and over as needed, such as a travel packing list, window & door checklist, and task/to-do list.

  • Notes/Journals

I’m an avid note taker.  All my notes are in Evernote, so it’s easy to search and quickly locate my notes. I also like to collect solutions to problems.

  • Bookmarks/ Collections

Evernote has a web clipper, you can bookmark or clip a page or save content to read later.

  • Agenda

This can be used to track meeting notes with action items or improvements. Also, I add notes and reminders for the next meeting.

  • Blog Post & Column Ideas

I’m a big RSS (Rich Site Summary) feed reader. I use an RSS to keep up with the latest news and alerts. Any blogs or news, I want to keep I clip to Evernote.

There are other applications which are similar to Evernote: Google Keep, Microsoft OneNote, SimplyNote. I highly recommend Evernote if you want to simplify your life.

Make Data Work Throughout Your Organization

Cover of "Data Driven: Profiting from You...
Cover via Amazon

Below is a recent blog post from Harvard Business Review. There are four steps to improve your organization: Improve the data; Build “data to discovery to dollars” processes; Invest in people; Strive to empower all with data. Are you a data-driven manager?

Make Data Work Throughout Your Organization

by Thomas C. Redman and David Walker

Data-driven managers, departments, and organizations have always enjoyed distinct advantages. The data-driven have crafted the best strategies, uncovered wholly new markets, and kept operational costs low. Today, advances in predictive analytics and the potential for big data portend even greater opportunity. Count us among the biggest enthusiasts for continual progress in these and related areas.

Indeed, we think every organization must develop and execute an aggressive plan to put data to work. But the vast majority readily acknowledge themselves as “data rich and information poor.” In these organizations, too few people are involved, too much data can’t be trusted, and too much data lies fallow in vast, unexamined warehouses.

So where to begin? Important as the technology and expertise may be, we find that most companies should focus first on high-quality data, process, people, and culture. Ignoring these is a bit like putting enough energy into a leap to get halfway across a stream; it takes time and money but leads to an unhappy result. We propose four interlocking steps to use your data more effectively and to create a data-driven culture in your company.

Improve the data. “Garbage in, garbage out!” It is trite to observe that results can be no better than the data on which they are based. Wall Streeters seem to have missed this point when they employed sophisticated algorithms to slice, dice, and price risk into the now infamous collateralized debt obligations, all the while forgetting (or blissfully unaware) that the data about underlying mortgages were corrupt. Make sure the data are properly, clearly, and consistently defined across the organization, improve quality, and promote sharing across units. To be clear, this is not — repeat not — an esoteric tech project. It requires concerted effort across the organization.

Build “data to discovery to dollars” processes. Create processes to put data work across the enterprise. Here we include processes to deliver more to customers; to repeatedly and forever seek hidden truths in data; and to seek out novel data and integrate them with existing data into a more potent whole.

is a terrific example. Armed with a deep understanding at the customer-level of where it makes money (not just generates revenue), a company can forge new relationships, change its price structure, and redirect its marketing campaigns. The technical challenges are legion. But they are nothing compared to the challenges of defining and managing the processes to link data from (disparate) cost and revenue centers, conduct the analyses, and renegotiate contracts.

Invest in people. Obviously, the high-powered analytics types are in short supply. But we’re even more concerned about managers who are accustomed to managing by the seats of their pants (and pantsuits) and threatened by data. Their new roles are essential, but they cannot execute without wholly different mindsets. The McKinsey report on Big Data suggests theU.S. alone faces a shortage of roughly ten analytically-competent managers for each deep analyst. Start by gathering a critical mass of these managers.

Strive to empower all with data. Drive data into every nook and cranny of the organization, show people how data make them more effective, and encourage experimentation. As they “switch on” (albeit slowly), most people make better, more confident decisions; seek opportunities to improve their work; and engage with others on larger, more complex issues.

This last point is driven home over and over. Take this example: One night Tom attended a celebration for a team in a telecommunications company that had drastically improved performance after implementing a new data quality measurement and control system. He asked one woman how the new measurements had impacted her work.

She looked him and said, “You know, before we had these measurements I never had any say in my work. We’d run into a problem, and I’d ask my boss how he wanted me to handle it. And he’d tell me. A lot of times the answer didn’t make sense. But I did what I was told.”

The excitement in her voice rose as she continued: “Now I have the facts. I still go to my boss. But now we discuss those facts. And he lets me do what I think is right. I’ve never had so much control in my work.”

Later that night Tom ran into her boss and asked the same question. He replied, “I always felt like my life was nothing but dealing with problems. People would come to me all day long and ask me how I wanted them to handle something. How the heck was I supposed to know? But there I was. Telling people what to do.”

He continued, “People still come to me with problems. But it’s different now. We figure it out. Together.”

A more capable team quite naturally produces better results. As a data-driven culture permeates more broadly, an enterprise’s abilities to take bold, innovative, concerted action on increasingly larger challenges also grow. This is critical. The really important challenges facing today’s organizations are enormous, multifaceted hydras. They will not yield to data alone. But the deeper, the broader, the more pervasive your data-driven culture, the better your chances.

Computing Basics for Small Business

Below is my article in the Lumber Co-operator November/December Issue.

All small business should have a basic understanding of the minimum requirements for the IT infrastructure needs. The following is a simple summary for each topic that any business can utilize to help better understand basic IT requirements:


Desktop PCs

All existing desktop PCs should meet the following minimum requirements (PCs currently in use that don’t meet these requirements should be replaced):

  • Windows operating system XP (Service Pack 3)
  • 1 GB RAM
  • Internet access capability.-10/100 network card.

New computers should contain at a minimum:

Windows Operating System 7,

  • 2-4 GB RAM
  • 7200rpm hard drive with at least 120GB
  • 100/1000 network card

Software Requirements

 Ideally, each PC should have an office productivity suite such as Microsoft Office, Open Office or Google Documents(Web based). All of these packages contain  a word processing program, spreadsheet capability and presentation software such as PowerPoint.  If you are using a cloud service provider like Google docs or a private provider then there is no need to buy this software for your PC as it is included in the web provider (often referred to as “cloud” service provider).

In order to access some of NRLA’s webinars, PC’s will need a media player program that plays music and videos. Windows Media Player is free and included with the windows operating system. Many NRLA webinars will use a plug-in program that will automatically launch in your web browser.

Every PC comes with Internet Explorer already installed but if your PC is more than 1-2 years old, the program should be upgraded to the latest version (currently, 9). There are other web browser programs that are available for free such as Firefox (version 5 or higher is recommended) or Google Chrome.

An email application is mandatory for all PC’s, either software or web based. Microsoft Outlook is the most popular software, although others such as Lotus Notes exist. Web based options include Google, Hotmail and Yahoo. Typically, a local internet provider will offer an email option that can be utilized. Web based options work well for small companies because the email files do not have to be backed up since they’re stored on the web rather than the PC’s hard-drive.  It is common for a cloud service provider to supply you with Microsoft hosted Exchange which allows you to have all the features of Exchange without any of the hardware or software capital costs; instead you pay a per user monthly fee for exactly what you need.

Firewall Software helps protect the PC from intruders, viruses and malware. Most PC’s come with a basic firewall, but it must be turned on. Also, it’s recommended that the user downloads a program called Window Defender from Microsoft. This firewall software will enhance the computer’s firewall decreasing outside threats that can harm your computer. Microsoft provides this software free of charge but subscription based software such asNortonor Trend Micro can be used. Some subscription-based firewalls have a tendency to slow the computer down so make sure you weigh your options before deciding.

Point of Sale software is used to record sales, purchase orders, inventory and accounts receivable and some packages include the general ledger. It’s important to make sure that your existing PC’s  meet the minimum requirements stated above for the POS software to work optimally.


There are two popular types of printers: USB connected or networked. The USB connected printers are typically used as personal printers, but may be shared. A networked printer is used by a group of people. The pages per minute (PPM) listed for printers lets you know the general speed. I recommend printers be above 20 ppm.  Network printers are the best option for simplicity and speed as they do not depend on a users PC to be on and allow anyone to print to it at anytime.


A computer network serves three purposes: facilitates communications; permits sharing of files (data and other types of information); shares network and computer resources.

A network facilitates communication by enabling employees to communicate efficiently, i.e. email, telephone, video telephone calls, video conference, and webinars. A network environment that permits data and file sharing can authorize users to access data and information stored on other computers in your network. Lastly, a shared network allows users to share networked devices such as printers, and scanners.

Network Security

A firewall plays a vital role in your network security by prevent stealing/corrupting data, viruses, and malware on your server or computer.

User level ID’s and passwords should be assigned to allow access to the information and programs on your server or PC. An ID prevents and monitors access to the network files and resources. Administrator ID’s are even more important than user-level ID’s since this user has access to all PC’s and networks at a given location. The administrator ID and password should be highly “secure” with letters and numbers that do not spell a dictionary word.  This password should only be distributed to the business’s owner and head of IT systems (or other trusted and qualified individuals) as it enables full authorization to any file on the network. A secure password should have more than eight characters and should include at least one upper and lower case letter, one number, and one special character (%,&). Let your employees know that passwords should not be shared.


A server is a computer that performs many roles such as network management, file security, computer resource sharing, and printer management and generally interconnects all computers and devices on your network. The server may be as simple as a network server which hosts shared files, or sophisticated enough to host a databases, connect printers, access the web, allow fax functions. If you have more than eight PCs networked you should invest in a server. Consult an IT professional for configuration and requirements.


Multiple options are available for individuals PCs or small networks including web-based options like Google Docs, Dropbox, Box.net. Some of these options allow file collaboration and sharing. For PCs without internet access, you can backup files using USB memory sticks, CD’s, or DVD’s. It’s important to backup your data on regular basis. Files should be backed up at least once a week.

Network servers should be backed up daily. The administrator can schedule the backup after hours and backup information may be stored on tapes or hard drives. There are two types of backup rotations: incremental or full.

Incremental backup only backs up the files that have changed for that day. You should have six tapes or hard drives which are labeled Monday, Tuesday, Wednesday, Thursday, and Friday. The sixth tape or hard drive is used to perform one full weekly back up. Remember to keep your backup tapes or drives off-site. The rotation should include the days of the week with a full backup one day during that week.

A full backup includes all files each day utilizing five or six medias. A full backup should take less than two hours.


Generally, the life of PCs or servers range between three and five years. All PCs and network servers should be evaluated on a yearly basis. It’s important to plan for replacement of computers that will reach the end of their expected life during the year by budgeting the estimated replacement cost for equipment expected to be retired. Also, the annual budget should include normal maintenance such as software, backup, and printers. Some businesses find it may be more economical to outsource their needs. Options range from an on-call request service to total network administration.