World Trade - October 2008 - (Page 37)

Software Strategy, RFID is entering the business transformation stage where the question is, “how can RFID help businesses gain an advantage from technology?” Airbus is at the forefront of RFID implementation. “Airbus made a strategic decision to look across multiple areas in the supply chain,” Burroughs says. At an April Webinar, Carlo K. Nizam, the head of value chain visibility and RFID for Airbus, outlined the enterprisewide rollout plan. Initially, it implemented RFID to track containers and to manage received goods in the warehouse. The company plans, eventually, to integrate RFID into manufacturing and to use that information to automatically generate billing based upon the actual materials used to build each plane. In the pilot project, Airbus found it lowered labor costs and increased accuracy. “The biggest beneﬁt,” Burroughs says, “is that it decreased inventory requirements.” Harvey says some companies are sitting down with their supply chain partners, including logistics organizations, carriers and warehouses, to develop a system that is effective for all players and then automate it for a fully integrated supply chain. “The goals are to move information faster, ensure information is correct and put a business system atop data ﬂow to allow exception management so you have actionable information,” he says. In the movement towards a “touchless” inventory information system, shippers, carriers and 3PLs often found that integrating their stand-alone systems rarely yielded a seamless supply chain information system. Bill Harvey, director of logistics for Elemica, says the disparity among systems is causing noticeable delays. The current challenge is to take advantage of the built-up IT infrastructure, optimizing it for enhanced visibility throughout the supply chain. Supply chain reinvention The Allen Group’s plan of a 6,000 square foot logistics park being built in Dallas. Technology is just one part of the solution, though. One of the goals is to minimize the time to get products to the shelf. “The product life cycle—the time between new model introductions in-house or from competitors—has shrunk to a few days or weeks from six months to a year,” notes Steve Sensing, VP Operations, Supply Chain Solutions, Ryder System, Inc. To maximize sales opportunities, “Retailers are demanding products reach their shelves within days,” he says. The luxury of a six week ocean transit is reserved for less time-sensitive goods. “The objective is to get warehousing closer to the customer,” emphasizes Walter Gruener, partner at Grant Thornton. Doing so has the overall effect of lowering shipping costs and speeding delivery by using more direct routes; having warehousing in similar time zones also helps the manufacturer and the customer work with the warehouse in real time. Carriers know this and are improving their routes into Mexico, and their facilities near the border. And to relieve the acknowledged congestion around major ports, some carriers and developers are expanding facilities near secondary ports like Tacoma or moving into more rural areas. By moving to places like California’s Moreno Valley, about 30 miles from Riverside, companies avoid the moratorium on freight movement during much of the day and gain more affordable and more available real estate. The Allen Group, a private real estate development company, is buying land in strategic positions for warehousing and industrial parks near major transportation corridors. ”Having land in Kansas City or Dallas near intermodal facilities is as sexy as oceanfront property,” Jon Cross, director of marketing, says. The heartland’s ‘inland ports’ as he calls these hubs, can reach 70 to 80 percent of the population within one to two days and the remaining percentages in four to six days. And, he says, labor is more stable in the U.S. interior because unemployment typically is higher than on the coasts. In Dallas, The Allen Group is building a 6,000-acre project with 60 million square feet of vertical storage. The industrial park is expected to create some 60,000 new and indirect jobs for the regions by the time it’s built out 30 to 35 years from now. It has the beneﬁt of being near Interstates 35, 45 and 20, and the Loop 9 rail corridor around Dallas, as well as the Dallas-Fort Worth airport. “It will be the ﬁrst industrial park in the U.S. to have two intermodal facilities,” Cross says, as Union Paciﬁc and BNSF both have hubs there. Near-shoring To deliver shorter transit times, near-shoring is very attractive,” Sensing adds. It puts manufacturing closer to the customer in time zones that are more amenable to normal business hours and in countries that share a common basis in Western philosophy and have more similar cultures. “Some companies are coming back to the U.S.,” Sensing says, while others are locating nearby. Although the topic of near-shoring arises in nearly any supply chain conversation, there’s broad agreement that this strategy is, so far, the subject of more talk than action. “Such decisions involve contractual relationships and so are held close to the vest and normally aren’t divulged until the decision is made,” notes WWW.WORLDTRADEMAG.COM The Allen Group 37 http://WWW.WORLDTRADEMAG.COM

Table of Contents Feed for the Digital Edition of World Trade - October 2008

World Trade - October 2008 Contents Tune Up Your Supply Chain Globalization: The Real Competitive Threat Supply Chain Watch Tradewinds Shippers and Providers Collaborate to Take on a Challenging Economy Tweaking the Supply Chain to Optimize Value and Minimize Cost Supply Chain Software Morphs Into Enterprise Management Can Warehousing Really, Truly Be Strategic? Everybody is Global Between the Devil and the Deep The Hidden Costs of ‘Free’ Translation Blowing Smoke

World Trade - October 2008

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