supply chains can promote peace: a postscript and a thank you note
Last fall, DC VELOCITY Editor at Large Steve Geary wrote about the role of supply chain initiatives in helping rebuild the Iraqi economy ("can a supply chain promote peace?" November 2007). At the time, Geary was deployed in Iraq, working as a member of a team charged with promoting employment in the war-torn nation. In this follow-up article, he looks at developments in that initiative in the months since he filed his initial report.
Steve Geary is adjunct faculty at the University of Tennessee's Haaslam College of Business and is a lecturer at The Gordon Institute at Tufts University. He is the President of the Supply Chain Visions family of companies, consultancies that work across the government sector. Steve is a contributing editor at DC Velocity, and editor-at-large for CSCMP's Supply Chain Quarterly.
Editor's note: Last fall, DC VELOCITY Editor at Large Steve Geary wrote about the role of supply chain initiatives in helping rebuild the Iraqi economy ("can a supply chain promote peace?" November 2007). At the time, Geary was deployed in Iraq, working as a member of a team charged with promoting employment in the war-torn nation. In this follow-up article, he looks at developments in that initiative in the months since he filed his initial report.
In a November 2007 story, I asked the question, "Can a supply chain promote peace?" One of the tricks of the trade in writing a story in the face of incomplete facts is to tee up a question, instead of making a statement. Last year, the supply chain sure looked promising as a tool to promote stability in Iraq, but the jury was still out.
Well, fast forward to the summer of 2008, and there's no need to be tentative. We can be declarative. Rebuilding an industrial supply chain promotes peace.
I've spent a lot of time in Iraq the past couple of years, working in support of some truly committed people, both Iraqi and American. We've been trying to get a once-massive national economic engine running again. While at this point it might not yet be firing on all cylinders, it sure is running.
In July, I received a thank you note from an Iraqi friend, a senior leader in his community. It was addressed to me, but it really was meant for the American people. In order to understand that note, you have to understand some of what has happened over the last two years in a city named Iskandariyah, near the Euphrates River, about 25 miles south of Baghdad.
A fact-finding mission
In the summer of 2006, a U.S. delegation traveled to Iskandariyah. We toured the State Company for Automotive Industries (SCAI) in Iskandariyah and found a massive derelict manufacturing facility employing a few hundred people. Just a mile down the road was a sister facility, the State Company for Mechanical Industries (SCMI). In between the two was a bombed out pile of rubble that had been the Hateen munitions complex. Once upon a time, these three facilities were among the industrial jewels of Iraq. At its peak, the Iskandariyah Industrial Complex employed over 25,000 people. In the summer of 2006, there were less than a thousand.
The delegation was there to begin exploring ways to revitalize SCAI and SCMI to promote stability in one of the most dangerous areas of Iraq, dubbed the "Triangle of Death" by the press. This was not a journey for the faint of heart: It required full battle gear, Apache helicopters overhead, and U.S. combat troops deployed and at the ready securing the perimeter.
"We need to put the angry young men to work," declared Lt. Gen. Peter W. Chiarelli, then the commanding general of the Multi-National Corps, Iraq. "One of the key hindrances to us establishing stability in Iraq is the failure to get the economy going. A relatively small decrease in unemployment will have a very serious effect on the level of sectarian killing going on."
The plan of action
From that simple premise almost two years ago came a comprehensive effort to include a business solution in the plan for that region of Iraq. Today, thanks to efforts by the government of Iraq, the Army's Task Force Marne, and a Defense Department Task Force called the Task Force to Improve Business and Stability Operations-Iraq, along with judicious support from the U.S. government, Iskandariyah is a resounding success. It's just that nobody in the United States knows about it.
During the worst days, explosive devices detonated outside the gates of SCAI, Al Qaeda mortar teams worked the area, support personnel from the Coalition taking the fiveminute drive from SCMI to SCAI required an armored convoy, and small arms fire could often be heard. Contrast that to March of this year, when Sens. John McCain, Lindsey Graham, and Joseph Lieberman took a stroll through the market in the center of town—without body armor.
SCMI now assembles New Holland Tractors for the domestic market in Iraq. Just this past month, SCAI sold 25 over-the-road tractor/trailer sets, with substantial manufactured content from SCAI, to a Kuwaiti company, a deal valued at over $2,000,000. In addition, an international automotive company is considering resuming a joint venture with SCAI that was last active before the First Gulf War.
The Iskandariyah Industrial Complex is building prefabricated housing units, oil refineries, buses, construction equipment, greenhouses, and other things too numerous to list. There are 1,500 students enrolled at a recently refurbished vocational-technical training center. And on June 1, SCAI and SCMI reached a critical milestone: On that date, they had 10,000 employees back at work.
The supply chain's role
Iskandariyah is a case study in the successful application of counter-insurgency approaches championed by Gen. Petraeus, the overall commander in Iraq. Because of the nature of insurgencies, lines between combat and non-combat operations are blurred, and economic lines of operation are a critical issue to the warfighter. It may not be called "supply chain" by the military in the field, but the underlying concept is there. Business solutions must be pulled forward to drive employment and be used as an instrument for peace.
Supply chain management is a key element in comprehensive plans required to execute what are known as stability operations. According to official Defense Department policy, "Stability operations are a core U.S. military mission that the Department of Defense shall be prepared to conduct and support. They shall be given priority comparable to combat operations and be explicitly addressed and integrated across all DOD activities including doctrine, organizations, training, education, exercises, materiel, leadership, personnel, facilities, and planning."
It even shows up in Army field manuals. "Stability operations may be necessary to develop host-nation capacities for security and control of security forces, a viable market economy, the rule of law, and an effective government. Security, the health of the local economy, and the capability of self-government are related. Without security, the local economy falters. A functioning economy provides employment and reduces the dependence of the population on the military for necessities. Security and economic stability precede an effective and stable government."
You can't have economic stability without a functioning supply chain, and you can't make that happen without some elements of a supply chain management solution— the policies, processes, data, technology, and people—available forward as economic levers to secure the peace. It's not the Cold War anymore.
Critical to the success in Iskandariyah has been the visible support of Sheik Sabah Khafaji, the deputy director general of SCAI, president of the City Council, and the head of one of the three largest tribes in the area.
And it is Sheik Khafaji who sent me a thank you note. Please forgive his English, but it is far better than my Arabic: "Thank you for the feelings of humanitarian [generosity] granted us. We have emerged into a reality as results of the efforts and great sacrifices made. And always will be successful work which develops human society ... and achieve security and peace for the people. Thank you for the great assistance you given us and wish you continued success, my good friend."
Yes, a supply chain can promote peace.
Author's postscript: A heartfelt thank you to the brave men and women of the 501st Parachute Infantry Regiment at Forward Operating Base Iskandariyah, who did so much and gave so much. I am grateful and proud to have known you. Geronimo.
E-commerce activity remains robust, but a growing number of consumers are reintegrating physical stores into their shopping journeys in 2024, emphasizing the need for retailers to focus on omnichannel business strategies. That’s according to an e-commerce study from Ryder System, Inc., released this week.
Ryder surveyed more than 1,300 consumers for its 2024 E-Commerce Consumer Study and found that 61% of consumers shop in-store “because they enjoy the experience,” a 21% increase compared to results from Ryder’s 2023 survey on the same subject. The current survey also found that 35% shop in-store because they don’t want to wait for online orders in the mail (up 4% from last year), and 15% say they shop in-store to avoid package theft (up 8% from last year).
“Retail and e-commerce continue to evolve,” Jeff Wolpov, Ryder’s senior vice president of e-commerce, said in a statement announcing the survey’s findings. “The emergence of e-commerce and growth of omnichannel fulfillment, particularly over the past four years, has altered consumer expectations and behavior dramatically and will continue to do so as time and technology allow.
“This latest study demonstrates that, while consumers maintain a robust
appetite for e-commerce, they are simultaneously embracing in-person shopping, presenting an impetus for merchants to refine their omnichannel strategies.”
Other findings include:
• Apparel and cosmetics shoppers show growing attraction to buying in-store. When purchasing apparel and cosmetics, shoppers are more inclined to make purchases in a physical location than they were last year, according to Ryder. Forty-one percent of shoppers who buy cosmetics said they prefer to do so either in a brand’s physical retail location or a department/convenience store (+9%). As for apparel shoppers, 54% said they prefer to buy clothing in those same brick-and-mortar locations (+9%).
• More customers prefer returning online purchases in physical stores. Fifty-five percent of shoppers (+15%) now say they would rather return online purchases in-store–the first time since early 2020 the preference to Buy Online Return In-Store (BORIS) has outweighed returning via mail, according to the survey. Forty percent of shoppers said they often make additional purchases when picking up or returning online purchases in-store (+2%).
• Consumers are extremely reliant on mobile devices when shopping in-store. This year’s survey reveals that 77% of consumers search for items on their mobile devices while in a store, Ryder said. Sixty-nine percent said they compare prices with items in nearby stores, 58% check availability at other stores, 31% want to learn more about a product, and 17% want to see other items frequently purchased with a product they’re considering.
Ryder said the findings also underscore the importance of investing in technology solutions that allow companies to provide customers with flexible purchasing options.
“Omnichannel strength is not a fad; it is a strategic necessity for e-commerce and retail businesses to stay competitive and achieve sustainable success in 2024 and beyond,” Wolpov also said. “The findings from this year’s study underscore what we know our customers are experiencing, which is the positive impact of integrating supply chain technology solutions across their sales channels, enabling them to provide their customers with flexible, convenient options to personalize their experience and heighten customer satisfaction.”
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Krish Nathan is the Americas CEO for SDI Element Logic, a provider of turnkey automation solutions and sortation systems. Nathan joined SDI Industries in 2000 and honed his project management and engineering expertise in developing and delivering complex material handling solutions. In 2014, he was appointed CEO, and in 2022, he led the search for a strategic partner that could expand SDI’s capabilities. This culminated in the acquisition of SDI by Element Logic, with SDI becoming the Americas branch of the company.
A native of the U.K., Nathan received his bachelor’s degree in manufacturing engineering from Coventry University and has studied executive leadership at Cranfield University.
Q: How would you describe the current state of the supply chain industry?
A: We see the supply chain industry as very dynamic and exciting, both from a growth perspective and from an innovation perspective. The pandemic hangover is still impacting decisions to nearshore, and that has resulted in a spike in business for us in both the USA and Mexico. Adding new technology to our portfolio has been a significant contributor to our continued expansion.
Q: Distributors were making huge tech investments during the pandemic simply to keep up with soaring consumer demand. How have things changed since then?
A: The consumer demand for e-commerce certainly appears to have cooled since the pandemic high, but our clients continue to see steady growth. Growth, combined with low unemployment and high labor costs, continues to make automation a good investment for many companies.
Q: Robotics are still in high demand for material handling applications. What are some of the benefits of these systems?
A: As an organization, we are investing heavily in software that will allow Element Logic to offer solutions for robotic picking that are hardware-agnostic. We have had success deploying unit picking for order fulfillment solutions and unit placing of items onto tray-based sorters.
From a benefit point of view, we’ve seen the consistency of a given operation improve. For example, the placement accuracy of a product onto a tray is far higher from a robotic arm than from a person. In order fulfillment applications, two of the biggest benefits are reliability and hours of operation. The robots don't call in sick, and they are happy to work 22 hours a day!
Q: SDI Element Logic offers a wide range of automated solutions, including automated storage and sortation equipment. What criteria should distributors use to determine what type of system is right for them?
A: There are a significant number of factors to consider when thinking about automation. In my experience, automation pays for itself in three key ways: It saves space, it increases the efficiency of labor, and it improves accuracy. So evaluating which of these will be [most] beneficial and quantifying the associated savings will lead to a “right sized” investment in technology.
Another important factor to consider is product mix. With a small SKU (stock-keeping unit) base, often automation doesn’t make sense. And with a huge SKU base, there will be products that don’t lend themselves to automation.
With any significant investment, you need to partner with an organization that has deep experience with the technologies that are being considered and … in-depth knowledge of the process that is being automated.
Q: How can a goods-to-person system reduce the amount of labor needed to fill orders?
A: In most order picking operations, there is a considerable amount of walking between pick faces to find the SKUs associated with a given order or set of orders. Goods-to-person eliminates the walking and allows the operator to just pick. I have seen studies that [show] that 75% of the time [required] to assemble an order in a manual picking environment is walking or “non-picking” time. So eliminating walking will reduce the amount of labor needed.
The goods-to-person approach also fits perfectly with robotic picking, so even the actual picking aspect of order assembly can be automated in some instances. For these reasons, [automation offers] a significant opportunity to reduce the labor needed to fulfill a customer order.
Q: If you could pick one thing a company should do to improve its distribution center operations, what would it be?
A: Evaluate. Evaluate the opportunities for improving by considering automation. In my experience, the challenge most companies have is recognizing that automation is an alternative. The barrier to entry is far lower than most people think!
Toyota Material Handling and its nationwide network of dealers showcased their commitment to improving their local communities during the company’s annual “Lift the Community Day.” Since 2021, Toyota associates have participated in an annual day-long philanthropic event held near Toyota’s Columbus, Indiana, headquarters. This year, the initiative expanded to include participation from Toyota’s dealers, increasing the impact on communities throughout the U.S. A total of 324 Toyota associates completed 2,300 hours of community service during this year’s event.
The PMMI Foundation, the charitable arm of PMMI, The Association for Packaging and Processing Technologies, awarded nearly $200,000 in scholarships to students pursuing careers in the packaging and processing industry. Each year, the PMMI Foundation provides academic scholarships to students studying packaging, food processing, and engineering to underscore its commitment to the future of the packaging and processing industry.
Truck leasing and fleet management services provider Fleet Advantage hosted its “Kids Around the Corner Foundation” back-to-school backpack drive in July. During the event, company associates assembled 200 backpacks filled with essential school supplies for high school-age students. The backpacks were then delivered to Henderson Behavioral Health’s Youth & Family Services location in Tamarac, Florida.
For the past seven years, third-party logistics service specialist ODW Logistics has provided logistics support for the Pelotonia Ride Weekend, a campaign to raise funds for cancer research at The Ohio State University’s Comprehensive Cancer Center–Arthur G. James Cancer Hospital and Richard J. Solove Research Institute. As in the past, ODW provided inventory management services and transportation for the riders’ bicycles at this year’s event. In all, some 7,000 riders and 3,000 volunteers participated in the ride weekend.
After years in the military, service members and their spouses can find the transition to civilian life difficult. For many, a valuable support on that journey is the U.S. Department of Defense (DOD) SkillBridge program. During their final 180 days of service, participants in the program are connected with companies that provide them with civilian work experience and training. There is no cost to those companies while the service member continues receiving military compensation and benefits.
Both sides benefit from the program. “We’re proud to work with SkillBridge to give back to our military veterans for the bravery and sacrifices they’ve made for all of us,” Troy Pederson, director of training and development at LiftOne, a Hyster-Yale dealer and established SkillBridge employer, said in a release. “In the last year, we’ve helped 10 SkillBridge interns transition from military to civilian life, and the value and positive impact of the program can’t be overstated. At LiftOne, we’ve gained so much from the experience and diverse mix of technical and leadership skills of our SkillBridge candidates.”