If it’s September, this must be Park City
While no one would have wished for the events in Florida, there’s something to be said for attending a conference whose theme is disruption while watching the news of Hurricane Irma on the television, fast on the heels of the hurricane in Houston, an earthquake in Mexico and another brewing storm in the Atlantic.
But, it’s not just the ravages of the weather. Right now, we live in disruptive and unsettling times. Of course, those of us who work in the supply chain, managing distribution centers, creating transportation and delivery strategies or just figuring out whether enough associates will clock in at 7 AM to get all of that day’s work out the door have been contending with disruption since the recession. Indeed, the real theme of this year’s conference is Foster Disruption – in other words, don’t let events like the Amazon Effect mess up your plans. Rather, it’s up to us to create the go-to-market strategies and business models that enable our businesses to take market share and mess up someone else’s day.
While we’re only half-way through Day 1 of the conference, I had my first conversation about challenging the status quo with Harry Moser, founder of the Reshoring Initiative that promotes and supports the return of manufacturing production from off-shore to the U.S., in the baggage claim area as we awaited our shuttle to the conference. Harry discussed the increase his organization is seeing in announcements of plans to bring production back. Is it real? Will it translate into more and better-paying jobs? Is it momentum from the Trump election and talk of breaking long-standing trade agreements, and if so, does it have legs? Those are largely unanswered, but the talk is there.
I sat on the van with three presenters, including Moser, and Steve Melnyk, a professor at Michigan State University (and a frequent contributor to Supply Chain Management Review, my other publication). Steve told us of a recent trip he took to China, where he visited four cities to see first hand the kinds of supply chain initiatives taking place now and on the drawing board for tomorrow. According to Melnyk, China is investing in infrastructure, training, technical research and development, and disruptive technologies like robotics and advanced manufacturing/3D printing. The goal is to be a world leader in all of the above. Talk about Fostering Disruption: The NextGen Supply Chain may already be here, Melnyk said, but it’s happening in China.
And, speaking of robots, Jim Stollberg, Dematic’s executive vice president of solutions, noted that in the last year or so, some $5 billion has been invested in 550 robotic startups, many targeting our industry. “Today, we’re looking at person to goods solutions. Tomorrow, it will be robot to goods solutions,” Stollberg predicted.
From the sessions I attended this morning, several themes emerged. And, while they are not new, they reinforce some of the disruptions that are impacting our industry.
The first is that meeting consumer expectations, or competing with the Amazon Effect if you wish, is increasing the need for flexibility and the need for complexity at an exponential pace.
The second is that software is far more important than hardware. Mechanical automation is great, but getting the most out of it is about software today and it will be about the Big Data that feeds the software tomorrow.
Third is that labor – or the inability to get enough labor and the right labor – is becoming more of an issue at all levels of the organization – from the floor to the C-Suite. During the introductions this morning, one small manufacturer noted that his company has 150 openings right now and is off-shoring because they just can’t find enough help to meet demand domestically. Another attendee noted that for most of his career, he justified automation based on reducing head count; now he is justifying projects based on the fact that he can’t find enough heads. And a third mentioned that his company is looking at ways to automate all of its conventional buildings. Why? “It’s turnover, retirements, the overall growth of our business, dealing with injuries and availability.”
The good news of all of this: None of us would be trying to deal with the disruptors to our businesses while looking for ways to disrupt our competitors if business wasn’t good and opportunities weren’t abundant.