Insights from the Field: Supply Chain and Logistics

Transcription Details: Insights from the Field: Supply Chain and Logistics

Date: 18 November, 2020

Panelists:

Aric W. Krause, Ph.D., Dean, Rensselaer at Work

Professor Michael Hughes, Director of Faculty Development, Rensselaer at Work

Lon Blumenthal (’70), Senior Project Manager, Nike

Roman Sobieri (’98), Head of Global Shipping, Etsy

Aric Krause: Good afternoon, everyone. Thank you so much for joining us today for this webinar: Insights from the Field - Supply Chain and Logistics, a part of our regular series for Rensselaer at Work at Rensselaer Polytechnic Institute. We're delighted to have you join us. We're looking forward to a very interesting discussion with our panelists today. We'll get started here momentarily. Before we do though, let me quickly mention that we would love to hear - as we're going through the session today - your comments or questions. So if you are interested in something that you hear, and you'd like to post a question that we will pose to the panel in the latter part of the session, please just simply open up your Zoom chat box and post your question in there and we'll make sure that it gets to the panel.

The session today will be recorded, and for that reason, we will keep most participants' video and audio on mute, and the video shut off simply so that in the recording, we're able to see the panel members who are speaking at that moment. So thank you for helping us with that.

Let's go ahead and get started. We still have people joining, but we're going to be very respectful of your time and we will wrap up precisely at one o'clock; at the end of this hour. So thank you again for joining us today.

To get us started, my colleague, Dr. Michael Hughes is going to be our facilitator today. He will introduce our other panelists and get us started into the conversation. So, Michael Hughes, let me hand it over to you.

Michael Hughes: Thanks, Aric. Really excited for today and all the things that we're going to bring to our participants who are with us. First, I'd like to introduce our two distinguished panelists for today. In no particular order, I want to start with Lon Blumenthal. Lon is currently a Senior Project Manager at Nike and he's joining us from Beaverton, Oregon. Good morning. Lon, how are you?

Lon Blumenthal: Good morning. Very well, thank you.

Michael Hughes: Thanks for joining us. Appreciate it.

Michael Hughes: Next, we have Roman Sobieri. He's the Head of Global Shipping at Etsy and is joining us from New York City, I believe. How are you today, Roman?

Roman Sobieri: Doing great. Great to be here.

Michael Hughes: Excellent, thanks so much for joining us. So - about three years ago, Rensselaer at Work began an initiative. And that initiative was to get our finger on the pulse of what's happening in the field.

And we did that by talking to organizations, not just in the United States, but also worldwide.

And when we say 'in the field', what we really mean is what's happening in these organizations.

So on the one hand, we've used all our findings through this initiative to really redevelop all of our programs from the ground up. And the purpose of that is so that they meet the needs of the organizations that we've spoken to. And so really, this is a reciprocal effect here. One: we're able to provide abilities to employees so that they can accelerate the progress of the organization. But in doing so, we also hope to accelerate the careers of the employees who are working for these organizations. And so it's really a beautiful combination of effects.

The initiative is still ongoing and hasn't ended. We continue to engage and interact with organizations across the world. And we're doing that now digitally, as you know. And we've been able to connect with dozens of organizations, as you can see here - some of the organizations that we've been able to connect with not just peripherally, but really on a deep level.

We've also been able to connect with hundreds, if not thousands of folks cumulatively throughout these organizations. So, in addition to fueling our programs, being able to provide value back to the organizations who support our programs, and accelerate the careers of the employees who participate in our programs, we also felt an obligation to share what we've been finding as we've been talking to folks. And so, that's what really brings us here today for this Insights event, particularly in the area of supply chain and logistics.

Because the pandemic has really changed so many things in all of our lives for better and for worse, what we wanted to do was get our finger on what is happening most currently to the folks in the organizations who we connect with. And so we did that via a survey.

Aric, could you let us know what's going on that survey?

Aric Krause: Sure. Michael, I'd be happy to. As you know, in the months of October and November, we sent out a survey. Many of you joining us today took a few moments and participated in that survey, but what we wanted to do was precisely what you suggested, which is - get our finger on exactly what the issues are today - what the challenges are and where organizations are headed in terms of supply chain and logistics. So we sent out a survey. To date we've had 282 respondents. You can see on your screen there some of the different industries that have responded to that survey.

Various sizes: one of our primary partners when we talk about organizations that we formally partner with is in aerospace and defense. You can see a very large representation there.

But we also have partnerships and conversations with individuals in literally every industry, and not just in the United States. You'll notice on your screen that we've had responses to the survey from all over the world, basically because as we all know, supply chain and logistics today is a worldwide phenomenon, not just a local phenomenon. So we're very proud of that response. And we think that that response, and the breadth of that response gives us a really interesting insight. One of the things we asked our survey participants to do was let us know which parts of the supply chain process they were involved in. So you can see that on your screen right now.

On the left hand side, we use the formal six aspects of the supply chain flow and process and ask people - so you can see that we've got a really good representation across all of those different sectors, with the exception of the 'returns' aspect, meaning when products need to be returned and or reserviced or refurbished etc., etc.

But of the survey respondents - he 282 respondents, you can see on the right hand of your screen - how people identified their involvement in that process in terms of their level and position. So we were very proud to have many different respondents from the C-level as well as the VP level and the Director level.

So that kind of outlines the survey. We just closed the survey this morning, so we will be continuing to analyze those results and seeing what's in there that we can continue to share

Michael Hughes: Thank you, Aric. Looks like a really exciting result from the survey, thus far. Good response too.

Aric Krause: Yes, it was a good response and what we then did Michael - is we took this data over the last week or so, and we really started to divide it up and see what was in there - what results, what we were hearing in terms of what's really going on in the field. So for today, I kind of am going to highlight, not the raw data, but three insights I think that we can draw from the results. And the first one substantiates that there's been a significant disruption in supply chain, as we know, in 2020.

But what we wanted to get at in that survey is where folks suggest that they were most challenged in terms of their supply chain as a result of some of the events from 2020. So what we did is we took the responses, we gave folks the opportunity to choose from 13 different areas of their supply chain operation and process and asked them where they saw challenges currently. So on your screen here you can see we've summarized those by the frequency according to industry.

So for example, on your screen on the left hand side you see aerospace has identified - and it makes perfect sense when you think about it - has identified four factors of the thirteen that were primarily relevant for them, which was supply constriction, the falling demand, given the number of people who aren't flying and therefore, the number of planes, platforms, and frames that are being ordered - engines, so on and so forth.

As well as new technology. So you can get a sense. Oh, and by the way - new technology - I was combing through the results to see - this included issues around blockchain, data lakes, RFID, so on and so forth.

In terms of the different deploying and using those different technologies, was one of the challenges. So we can interpret this as for aerospace and defense, for example, they were trying to deal with the challenges of supply constriction, the issue of staffing and the ability of staff to react.

And in fact, you'll see here's four industries on your screen right now, Michael. I'll just quickly show you for additional industries. So I chose the top eight industries of the 12 that seemed to have the most significant frequency of problems identified

And you can see that across these eight industries. There's one consistent factor that came up consistently and this is this idea of staffing and ability to react. A different way to read that would be the ability of staff to react to the external stimulus, or the external challenge that was challenging their supply chain operation today. So this doesn't mean that we don't have enough people staffing, it means that our ability to react to some external force like COVID 19 and its effects really challenged our staff.

Does that make sense?

So I looked a little bit deeper in the data and what we can see - so I actually did a meta- theme analysis as well as this word cloud to kind of show you what's going on. And I think we can just draw a quick point out from this data, Michael, which is that firms had a disruption and it caused their supply chain - their current supply chain to be challenged. I.E. it may have been operating sufficiently up to 2020 but then these external issues have occurred. And now we see that the challenges in those supply chains became glaringly apparent in many cases, one of which was. This, again, this idea of the ability of our staff to react to the external force.

Michael Hughes: Ah, I see the logic chain there. So some disruption, and then these are some of the causes of the disruption, and then some of the symptoms of that disruption is what maybe we're seeing in the survey.

Aric Krause: Exactly. That's exactly right.

Michael Hughes: Gotcha. Okay, perfect. Well, you know, let's hear from our panelists and how they're experiencing some of these issues. Let's first turn to Lon. So Lon, you have over two decades of experience in implementing technology and supply chain processes and systems not just at Nike. In fact, some of the other notable companies that you you've worked with are Walgreens, and Blue Cross Blue Shield, Deloitte, and Accenture. Do you mind commenting on some of how these issues are presenting themselves at Nike today?

Aric Krause: Lon, you're on mute.

Lon Blumenthal: Okay. Testing one, two. Thank you. Technology is great when it works!

Thank you for inviting me to be on the panel with Roman.

In thinking about the data and this word cloud, it's very, very interesting. What I have seen over the years, with many, many clients. I've been consulting now 21 years both large and small.

The data that Aric presented was the ability to respond and be flexible. I would enlarge that a little bit. To me, it's really around the question of readiness for change - adapting to changing market conditions.

If supply chain hasn't had a seat at the table., I'm talking about the strategic leadership table of the company - the challenge is to get a procurement and supply chain to have a seat at the table to align with the strategic business objectives of the company.

And…

Aric Krause: Again technology works when it works.

Michael Hughes: Alright, it looks like Lon's point comes to the surface here - technology works well when it works. Let's get Lon a few minutes to get reconnected. But in the meantime, I want to make sure that we hear from our second panelist, Roman.

Michael Hughes: You too have many years of experience leading teams and executing on innovative solutions. And you too have done so at a variety of very noteworthy companies as well, including Pitney Bowes and Cheetah Mail, Fujifilm and Pratt and Whitney, so even some representation in the aerospace and defense industry as well. Would you mind commenting on what you're seeing at Etsy?

Roman Sobieri: Sure. Well, I mean, in regards to the big current pandemic situation you know Etsy is remarkably well positioned because of just the nature of it in that we're an entirely dispersed model.

We don't have single concentrated warehouses, you know, literally everywhere, it's everywhere. And so, you know, the opportunities for bottlenecks are much more reduced than you know if you're let's say limited to an area that's impacted particularly. So in that sense we've been in a good position in that as far as the changes you know? Yeah, this is a whole new paradigm for people and as I look at this from a consumer standpoint, literally overnight, it's changed from consumers being focused around one set of values versus a different set of values, where previously it was all about 'Where can I get the best deal, Where can I get free shipping?', suddenly it just converted over to 'can I get it?' now, and reliability suddenly became the key element to all of this, and it's a little like the plumbing in your sink, where you just turn it on, and you expect the water to come out. And it always does. So you don't even think about it, and suddenly when it stops doing it, you start to panic and so I think that's why a lot of consumers have gotten to the point where they don't trust the supply chain - rightly so - because it in many ways has been impacted, whether it's delays…

And so, you know, I think Lon commented about the technology and when it works. A lot of the technology was built, but it was never really pressure tested for the extremes. And so you see many extremely successful organizations have had situations where you let's say place an order for something and then they accept your money, you see it go, and then suddenly a week later, you get a message that says, oh, this item is not available.

That's not supposed to happen. You're only supposed to sell things that you have. So that's a data failure, not knowing what you have in your inventory in real-time. So things like that of a sudden became so apparent - all the weaknesses and the things that perhaps never would have come up and now, become the most important things. So I think, you know, having a good handle on those elements has become more of a feature than anything else, and the organizations that can keep that trust are the ones that would be the most successful in that. So I'll say maybe more important than having everything is being transparent about what's going on. And if you don't have something, don't represent that you do and don't try to. Don't try to fudge it because that's ultimately going to blow up in your face in consumer demand, in trust, in long-term loyalty

Michael Hughes: Thank you.

Aric Krause: Michael, a question came in. Can I throw it out to Roman?

Aric Krause: A question came in: You've had opportunity to work in very traditional firms as opposed to e-commerce firms. And the question has to do with - from a leadership standpoint, do you see a difference in the prioritization that leaders are giving in these newer - quote newer - industries versus the more traditional industries? Where do you see the difference in that, and how, how big of a role do you think that plays?

Roman Sobieri: With regards to logistics?

Aric Krause: Exactly, exactly.

Roman Sobieri: Yeah, no, absolutely. It really is night and day. You know, I think Lon did make a reference to that - that logistics is getting a seat at the table where previously they haven't. I mean new firms have to think about logistics a lot more actively. And having the benefit of building something from the ground-up, you know, within the last decade, within the last five years, has inherent advantages. In traditional organizations, you know, your supply chain systems are built on solutions that are perhaps 10 years 15, 20 years old, with API integrations and things. And so it's like a slow turning ship and nothing happens quickly. So, you know, you don't expect reactions very quickly. And so your supply chain elements are very buried into the organization under some other subcategory. Certainly you know in organizations like Etsy and Fuji, at any given moment, I can get a reach out from the CEO asking me what's going on with this? What's going on with that? So it's it a level of intense visibility and responsibility because they recognize that the consumer experience - it lives and dies based on getting the products on time and meeting the expectations.

Michael Hughes: Thanks for that Roman. Really appreciate your perspective there. I want to go back to Aric for a second and go a bit further into the survey. What else were you able to pull out of the responses?

Aric Krause: Excellent. I think this is going to really get close to the point that Roman just raised, so I'll be interested in seeing Roman, your response to this. The second set of questions that we asked people, is we asked them to evaluate different aspects of their supply chains' current performance. And we summarize those groups by functional areas, or dimensions as I call them on your screen right now -eight of them - eight different dimensions as well as - again by industry. So I'll show you those results here. I'll show you the first six industries and then I'll show you the second six industries and we'll start to see some commonalities between these various industries.

So on your screen right now you see a table that has columns that show the various industries. Again, six are on your screen right now. In the left hand column then, we showed the eight capabilities, or the eight dimensions of supply chain. So business processes - How effective are the processes within your organization that are set up to drive the supply chain and logistics processes? How strong are relationships in your organization between the elements of the supply chain? How strong is the communication between the elements of your supply chain? How often is data accessible, and how often is it actually used?

How is the performance? How would you evaluate the performance of the supply chain as a whole in achieving organizational goals? Whether or not it is optimized? Which has a little bit of a connection back to the data use and access. But, again, is it an optimized process? Is there a specific effort underway to make sure that what is happening is happening in an optimized manner? And then of course, visibility - and this Roman is again back to part of the point that you raised. How visible is the supply chain, how high of a priority? Visibility meaning priority and transparency in terms of how its performing. So folks were asked to evaluate this, and then we heat map those responses, Michael.

So you can see at the bottom of your left hand screen there, we gave them a scale where reds were when it was evaluated as not effective, and green - varying degrees of green - was more effective. So we then baselined this on a yellow as a neutral. Not bad, not good. Just sort of neutral. So you can look at this screen in two different ways. You can see first of all in the columns how aerospace and defense, for example - again, the number of respondents are aggregated up, these aren't company specific - but how respondents throughout that industry evaluated these different dimensions of their supply chain. You can see that some are neutral, some are light green, some are red. And then you can see the same in Chemical right here.

That's one way of looking at this chart is in the column - columnar form.

But you can also look at it in the row form, saying 'how are business processes across these industries?' in terms of how organizations evaluate the effectiveness of those business processes. And you can see that for these six industries, in essence, they're rated to be pretty good. So let me draw out two quick examples and then we'll look at the other six industries and then I can't wait to hear what Roman and hopefully Lon will be back by then - their responses to this. Let's look at finance, for example. Finance is in this column right here and you can see that folks in finance evaluated each of these different dimensions in some manner of green.

We could expect that. And we could expect that for a particular reason. The industry of finance is a very, very competitive industry. They're very dependent on data, I.E. if they don't have the right data, they're going to make bad trades, or they're going to make bad - they're not going to make money. So, given their high dependency on data and the high degree of competition in this field, and a little bit less reliance on external aspects of a supply chain, I.E. their vendors, or vendors' vendors - there's really not a lot of that.

There's clients, and clients' clients, but not necessarily the upstream. They rate their industry fairly green, whereas I'll pick on our own industry just for a moment, Michael - education, this is K-12, higher ed - all of it.

The whole industry hasn't had necessarily those same pressures on it to evolve so Covid-19 tended to be a little bit more impactful. So you can see in education, for example, business processes, the use of data, the optimization of how education is delivered is a challenge as an industry.

With those two examples, let me go to the next six industries on your screen right now. And I want to draw your attention to retail/e-commerce, because again, as Roman pointed out a moment ago, e-commerce for one is a very young industry, relatively speaking, and retail has been under tremendous pressure in the last 15 years. I mean, we see that, especially this year: tremendous pressure to optimize and perform at a very high level. So the youth of e commerce and the pressure on retail - formal retail -result in this being largely green as opposed to some other industries. But let me draw one more quick point out of this data that I think is really telling before we look for more responses. Look at the cross cut. The functional use, data use, data access, and optimization show up as potentially the three largest challenges for industries as a whole. Across industries, these tend to be the common problems. In fact, if you took out the lines 'data access, use, and optimization', there would be very little red in this chart.

And it's not just these six industries. In fact, when we pull up these other six industries you see they're primarily red too. So an interesting conclusion is that if you look at the top of this: business processes, relationships, communication - those are the leadership slash soft aspects of supply chain, whereas data access, use, and optimization, one could suggest might be a little more quantitative in nature. I.E. a little bit more math, a little bit more use of data generation. So we see kind of an interesting contrast between those two aspects. Companies rate the leadership soft aspects highly and the quantitative aspects lower as significant challenges across all of these various industries.

I think that's an interesting conclusion. I'd love to hear thoughts and reactions to that.

Michael Hughes: Great work, Aric. Thanks for providing that second insight from the responses to our survey. Let's turn to Roman first to get his reactions and see how he's experiencing things at Etsy around some of these issues that you brought up.

Roman Sobieri: Okay, well, in regards to the voting. I guess my first reaction has to be to demand a recount.

Sorry - been watching too many elections. Um, yeah, data is a challenge. And it really depends on what that data is. I think what we've been seeing in the last couple of years is a huge surge of pushback on the use of data, specifically, personal data.

Europe led the charge as you know, would be expected with the GDPR regulations. California has instituted a lot of regulations about data. And regards to personal data, the medical profession has always been challenged with HIPAA requirements and regulations, so the ability to use data in a meaningful but compliant way is actually incurring a lot of headwinds. And so, I'm not surprised to see it in certain organizations and areas. In education, how do you use the data without exposing personal data and the privacy elements? So, you know, yeah, that's, that's, entirely what I would have expected.

In certainly the retail and e commerce - e-commerce was born on data. And so, nobody in the organization is doing their job if they're not constantly reviewing data into what the behaviors are and how that is.

But certainly retail comes with the other direction, using the virtual data and e-commerce sales, combining it with their physical stores - it's been identified to be overused omni-channel language around that. I mean, for many organizations, it's like fitting a square peg into a pineapple.

It's not even a round hole. It's just something that is completely not compatible.

And so, they've been having to re-invent how they store data, they collect it, and use it. So, it's certainly an uphill battle. I think the successful organizations are the ones that have adapted quickly. To some degree, it's why you've seen so many dot coms pop up so quickly. Because they haven't been burdened with legacy systems and they can just start from scratch. So I'm just shocked to see in some areas where a little 5-person dot com e-commerce organization can pop up in the area where its full of legacy behemoths out there and be successful. And it's for that very reason - the ability to quickly and nimbly use data effectively. So, I think that's going to be a competitive advantage on an ongoing basis until those organizations can effectively leverage the massive amount of data that they have. And, you know, certainly the big ones - the Walmarts and the Amazons and you know, certainly Etsy - my organization and we're very good at it now, you know, but I think that's going to be an extreme factor in all of this.

Michael Hughes: Awesome. Thanks so much Roman for sharing that.

It is very interesting to see some of these small dot com businesses pop up and be successful due to their agility.

You know, I think that Lon was able to rejoin us. So I just, I want to say Lon, are you, are you able to speak now?

Lon Blumenthal: Testing 1-2. Oh, excellent.

Michael Hughes: Excellent. Well, Aric had just shared some of the insights related to perceived issues in the responses around data access and data use, but also some of the green that we're seeing - some of the effective business processes, relationships, and communications in the responses to our survey. So I want to make sure that you get some time to respond to those, and what you're seeing at Nike and throughout your career.

Lon Blumenthal: Okay, thank you. I apologize for the technical difficulties. I heard only part of Roman's response, but in general, the key aspect of data and optimization has to do around a single source of truth. Many companies have legacy technology. They're very complex. People use many workarounds or the old timers don't want to change the code - that kind of thing. And even if a company is swimming in data, sometimes there's little insight. There's little real knowledge. And in terms of a supply chain, and thinking about moving data up and down the supply chain. I would just emphasize that companies could do very well to start with a few key pieces of data - maybe having to do with demand signals, or supply signals, and build trust with their strategic suppliers - start to share a bit more information, regardless of the IT architecture that the company currently has, and build from there.

RFID tracking for inventory is a recent trend, and as customers order more, the inventory data, and the accuracy of the inventory data is really critical to help a supply chain get the correct product to the correct place that the customer wants it.

And then finally, I would just add: of course, there are many different types of workflows - make to order, make to stock, assemble to order, and engineer to order. And these different workflows have impacts to information systems, how they're configured, and the data that's available. So aligning the supply chain information flow to the company's business strategy is a very key element for optimizing supply chain data.

Michael Hughes: Thank you, Lon. If we can just go for just a minute back to Roman

How - you know you said that Etsy has been very successful in the use of data. And I'm just curious how, how does, how is leadership playing a role in that at Etsy? And if you don't mind, commenting on kind of that interplay?

Roman Sobieri: Well, I mean, I think the fact that the data is part of our DNA - it has to be -and being in a purely online organization, we have that luxury. So, everything that we do is iterative - we actually do several, if not 10s of releases and changes every single day in our solutions, and purchasing process and you don't do that, you know, especially when you're a multi-billion-dollar organization now without tapping data around that.

So you're release something and then you're testing it. You know you release it to a certain percentage of the consumers and you test to see what impact is that going to have? Is that going to hurt conversion, or improve conversion? Does it improve customer satisfaction, or hurt it? Before you release it, can you pull it back if it causes more harm? And, you know, certainly a significant number of the things that we release are immediately pulled back because it causes more harm, more confusion than benefit. You know, in that sense, so that data is all constantly recorded and it helps make accurate decisions. You'd be surprised at how many things are so counterintuitive. You think 'this is a great idea', and then you release a part of it. You find out. No, it's really not. Just unintended consequences - it confuses buyers or it causes them to have a different expectation than you really intended. So, just flying by the seat of your pants doesn't cut it anymore. And that's what the data helps you do is be able to initially predict what the impact of something is, but then be able to live-test it in real time and then react and pull it back if you need to.

Now that's really the power of data, aside from, the obvious of being able to use that to help the consumers like the on-time delivery expectations, in the speed of data being able to react when this particular supply chain, this particular country, this particular carrier, all of a sudden has challenges in Chicago and all of a sudden, anyone who's receiving orders in Chicago should expect to get things five days later. That's the kind of data that you need to have in place to maintain a consistent user experience.

Michael Hughes: Awesome. Thank you so much. Roman

Aric Krause: Michael, can I follow up with one quick question there?

Michael Hughes: Absolutely.

Aric Krause: When we were - and this just has to do with this data - so it's a convenient moment to throw it out about this data - we had a chance to review this data, just briefly, the other day with both Roman and Lon, and I found an interesting insight came up. And I'd like to ask you each to just share your thoughts about it real quick. And again, looking at it more from across all these industries as opposed to the exact industry. I thought we were all little bit surprised that relationships and communication were as green as they were given that some of these other challenges were as red as they were. I'm just curious Lon if you would take a moment or two, and respond to that, then we'll come back to you Roman as well if that's all right.

Lon Blumenthal: Oh yeah, can you hear me still? Yeah, relationships, I believe are the heart of a supply chain, and as the environment changes and different forces come to play around the world, relying on those relationships and communications - as I mentioned earlier - to build trust and to be able to share strategies and challenges to me is very, very important. Leaders - if all they do is approve budgets and attend kickoffs, in today's world that's woefully inadequate. They need to roll up their sleeves and work with their supply chain leaders, and other leaders of course in the company - up and down the supply chain - to plan for capacity and product inventories and the movement of those inventories as Roman was alluding to to be able to meet customer expectations, no matter what is changing out in the environment. And so communication and relationships to me are very, very critical.

Thank you.

Michael Hughes: Roman, your thoughts?

Roman Sobieri: Yeah, I mean as far as relationships and communication, those are optimizations for any successful organization. The interplay between individuals is critical when you're developing anything new and working together. You can't have an environment where someone is afraid to speak the truth and identify issues. You don't want all these solutions coming from the hippo - the highest paid individual. That that's not going to achieve the best results because they may be the highest paid, but they may not have all the insights. They may not be the smartest person in the room. And so you need the ideas to be freely flowing and not dependent on fear of retribution or politics. So building a culture of trust and mutual support makes the entire organization, much more successful and, you know, less likely to go down rabbit holes that they shouldn't. And then the communication - the bigger an organization is, the more challenges you have with the communication and to do it effectively.

You know, obviously we're all in a pandemic now. Many of us are working from home. And so some of these things have become more challenging to the world. Having meetings on Zoom rather than sitting next to each other and maintaining culture and communication during these times is an active process, and it's not just assumed that everyone will continue to communicate as well as they have in the past. So, you know, I think those are key elements but they're fuzzy because they don't go on a spreadsheet. No one says 'what's our budget for relationships for next quarter'. No, but honestly, they should. They really should because that's as a meaningful for the success as anything else.

Michael Hughes: Thank you.

Michael Hughes: Aric, do we have time for pulling out one more of the insights that you saw in the survey?

Aric Krause: Yes, we do. Thank you.

Aric Krause: This is kind of...Roman and Lon sort of led us right into this one right here. One of the questions that we asked in the survey also said - asked specifically what direction their organization needed - from their perspective in this process - what direction did the organization need to make - I'm going to, I'm going to use a word that I think Roman and Lon both brought up - to make our supply chain from the vendor to the client, all the way through - more resilient? And you can see on your screen now - again using meta theme analysis – it’s most easily visually represented in a word cloud - really shows those things that we need. The prioritization, we need the communication, we need the visibility - going back to our dimensions - the visibility on this very, very important value process. This is where the organization is creating the value. We need the highest-level support to prioritize it, get the data available where we need the data, but also get the communication flow, and the information going back and forth so that this thing can act optimally. I think both Roman and Lon also, I've heard them suggesting that all the data in the world, all the technological infrastructure to get that data is not a sufficient condition. It also requires a leader who can prioritize and bring about the evolution and or resiliency that that system requires

Love to hear responses to that statement.

Michael Hughes: Lon, do you mind to commenting first?

Lon Blumenthal: Happy to jump in. All those points are very, very key.

But my top line message, and my experience with senior management and leadership is that they have to learn with their teams, learn with their customers, and learn with their suppliers. We're all on a learning journey, especially with the virus and the changes in in global dynamics. Yesterday's solution typically doesn't meet today's need. And as I alluded to earlier, rather than just approving budgets and attending kickoffs, leaders need to roll up their sleeves and be okay with not knowing all the answers, but being okay with working with their teams cross-functionally within the company, and then cross-company in their chain to ask the important questions, explore options, and pick solutions that are going to optimize their business and their results.

Michael Hughes: Thanks Lon.

Michael Hughes: Roman, would you mind responding or sharing any thoughts you had on the findings from the survey - this final insight.

Roman Sobieri: Yeah, I think that's, you know, leaders really have to find as Lon indicated - they have to define the strategy - which direction is the organization going? What outcomes are the most important? And then help the organization define what are the proposals of value? What do your customers need?

And once you start with what your customers need, then let your teams come to you with how to achieve that. You know, what solutions can they offer to improve the customers' experience and make your product more successful, make it arrive in a more pleasant way to distinguish yourself from the competition in general. And I think so, to some degree, the leaders have to set up the framework, ask those right questions. And build an environment where the experts in each of the areas can come to you with their solutions rather than a top down approach, you know, is sometimes successful, you know, in the short term, when you're in a very focused, problem-solving mode. But in general, you need to have a wide bench.

And, if you don't, then you're going to have some single very successful solutions and some giant blind spots that nobody is looking at. And that's why the leaders need to give that breath of latitude to let the teams and individuals in their areas define how best to support those customer needs.

Michael Hughes: I see. It's funny you bring that up. I was, I was just - something popped up on my newsfeed just this morning - I think it was a quote that said "We don't hire smart people to tell them what to do. We hire them so they tell us what to do". Is that - is that similar to the idea of what you're speaking to?

Roman Sobieri: Much more eloquent than, and definitely more succinct.

Michael Hughes: Well I stole it from somewhere else.

Lon Blumenthal: I would just jump in and add - I remember something that Dr. Deming - W. Edwards Deming used to say - he used to say "good people are trapped in bad processes". And one of his 14 points, if you're familiar with Dr. Deming's 14 points - I forget which point it is, but it's drive out trust, which we've been talking to today, and applying that in a supply chain as you start with the end customer, and you just work backwards. Build the workflows, identify gaps and barriers, prioritize them, and then brainstorm solutions to address those gaps so that the workflow is much more efficient and effective in meeting the customer needs.

Aric Krause: That's awesome. And you're leading right into the final insight. I wanted to point out - because one of the elements in the comments section of the survey had to do with…

Yeah 2020 has really introduced - maybe let us see - that we have challenges in the resiliency of our supply chain processes, be it for legacy reasons, be it for whatever the challenge source is.

But we really have an opportunity. It really introduces an opportunity for us to-re baseline these things and recommit ourselves to making sure that they are serving the client to your points, and driving where it needs to be so that we're using data appropriately. And we're leading the way so that the chain leads to intended results. So we have a ton of really, really interesting questions that have come in. So is it okay if we ask a few, Michael?

Michael Hughes: Sure, let's take a few minutes and maybe we can solicit you know 30-second responses or so from our panelists, so that we, we make sure we're, we're getting wrapped up on time here.

Aric Krause: Okay, the first one. Michelle asks: "Is it all about the supply chain? Where does the customer come in to that? If you don't have customers, obviously you have to have a very different plan to push back to suppliers, hold inventory, cancel shipments"

And Lon, maybe you were just referring to this - Where does it - Where does the customer come up in all this discussion?

Lon Blumenthal: Yeah, the way I like to think about it is the voice of the customer - VOC. Sales people hear it very keenly, very loudly. If you go down into a - not to pick on engineers, although many of us here are engineers - sometimes on engineering teams, the voice of the customer is very hard to hear.

And therefore, bringing in multifunctional representation to make the voice of the customer loud and clear is the best way to design and improve the supply chain to meet the voice of the customer needs.

Aric Krause: Michael, Jay points out very well that we should include as one of our eight dimensions a ninth dimension, which is innovation. How innovative is your supply chain?

Jay, we will make that correction, because I think that's a fascinating point. Quick question for Roman – Roman…

Aric Krause: Michael asks: "To what degree do you see regulation as a barrier - be it trade, or government, you know whatever sort of regulation you want to talk about - as a barrier to a high performing and flexible supply chain?"

Roman Sobieri: Wow, that's such a timely question and it is absolutely a challenge because the regulatory environment is constantly in flux, especially, you know, cross border, but even, you know, even domestically in various regions. So whether it's new customs rules, that the data that you need to move items from one country to another, the flexibility of certain organizations to be able to adapt to those - They're gonna live and die by them. So this kind of plays into an earlier theme about relationships.

The regulatory issues - usually if you don't have good relationships in various industries - your peers, people in regulatory positions - then you're going to find out about them without time to react. So being able to hear about those early on, potentially influencing the outcome of those regulations - I've had some history in being able to do some of that, fortunately, but, otherwise you're going to become just a victim of it and somebody's gonna find out that 'hey, all my shipments have stopped because of this new regulation, that's our new tax' so that is absolutely essential, especially as we become more and more globalized.

Aric Krause: Love to hear both your comments. Michelle brought up the point that we may see the greatest challenge both regulatorily - I'll make up a word there - as well as logistically in the future rollout of a vaccine, given some of the temperature requirements, distributional requirements,

And I'd love to hear - again in 30 seconds or so - both of you respond to: If you are running that supply chain, that process of getting it from whoever the manufacturer is to the individual, what would you do to make that pull off successfully?

Lon Blumenthal: Yes, I'll be happy to go. As I said earlier, having a seat at the table is critical, and it really builds on what we've been saying about starting from the endpoint and working back. Capacity is going to be a key element for the distribution, and therefore all of the factors that are going to influence capacity: storage, inventory, transportation - all of these elements have to be thought through and really rigorous solutions need to be put in place.

Roman Sobieri: I wish I can add to that, but I think Lon got it exactly right. To work backwards from the recipients to define what the need is, what you're going to need where, and then work backwards into the storage and how you're going to get there as quickly and on time as possible.

Aric Krause: Awesome. There are a whole bunch of additional questions, but unfortunately we're a little bit on the time limited side. Thank you very much

For those questions. I did want to point out before we wrap up that as Michael alluded to earlier, we have had so many different conversations. The survey serves as another channel for data collection - for intelligence gathering really from our employer partners and from working professionals about these challenges, and I'm very proud to say that as a member of the Rensselaer at Work team, we have worked very hard as Michael stated earlier to develop programs that DO, that help people build the capacity to do the things we've talked about today. For example, we have the certificates that you see on your screen right now. These are graduate-level; they are for-credit certificates. I mean, they count for credit certificates. They can be completed in a year or less.

And an individual working professional, a leader could take these certificates in a year or less and build out that ability set that they need. If they see an opportunity to help improve who they are and how they present - I.E. achieving their professional goals. So I would encourage you to think about these certificates that you see on your screen right now. We're very proud as Michael said to have re-architected these things from scratch to be all about the act of learning. We believe that we learn by doing, learn through contacts, learn by seeing how things work in the real world and how they apply so students work on projects that give them not only the foundational ability, but also the experience of having done with colleagues from all over the country who are going to be in that course with them, with insight from their peers and from their expert faculty mentors who will be working with them. So if you see or you heard today, or you're thinking about an ability that you'd like to enhance in your professional portfolio, let's talk about that because we can help you with these certificates and with our accompanying degree programs - get that ability set that you want in an active, engaged, applied way in a year or less.

Michael

Michael Hughes: Thank you, Aric. Well, thanks everyone for joining us today. And thanks to our participants for also joining. I'm sure everyone's a bit Zoomed and WebEx-ed out so we appreciate your time and your participating in the session today. For more information on our programs or to connect with us you can just go to EWP - Education for Working Professionals dot RPI dot edu and we hope to hear from all of you very soon. Take care. Stay safe, and have a great rest of the year.

Lon Blumenthal: Thank you all.

Aric Krause: Thank you Lon and Roman. Thank you very much for joining us today.

Transcription Details: Insights from the Field: Supply Chain and Logistics

Date: 18 November, 2020

Panelists:

  • Aric W. Krause, Ph.D., Dean, Rensselaer at Work
  • Professor Michael Hughes, Director of Faculty Development, Rensselaer at Work
  • Lon Blumenthal (’70), Senior Project Manager, Nike
  • Roman Sobieri (’98), Head of Global Shipping, Etsy

Aric Krause: Good afternoon, everyone. Thank you so much for joining us today for this webinar: Insights from the Field - Supply Chain and Logistics, a part of our regular series for Rensselaer at Work at Rensselaer Polytechnic Institute. We're delighted to have you join us. We're looking forward to a very interesting discussion with our panelists today. We'll get started here momentarily. Before we do though, let me quickly mention that we would love to hear - as we're going through the session today - your comments or questions. So if you are interested in something that you hear, and you'd like to post a question that we will pose to the panel in the latter part of the session, please just simply open up your Zoom chat box and post your question in there and we'll make sure that it gets to the panel.

The session today will be recorded, and for that reason, we will keep most participants' video and audio on mute, and the video shut off simply so that in the recording, we're able to see the panel members who are speaking at that moment. So thank you for helping us with that.

Let's go ahead and get started. We still have people joining, but we're going to be very respectful of your time and we will wrap up precisely at one o'clock; at the end of this hour. So thank you again for joining us today.

To get us started, my colleague, Dr. Michael Hughes is going to be our facilitator today. He will introduce our other panelists and get us started into the conversation. So, Michael Hughes, let me hand it over to you.

Michael Hughes: Thanks, Aric. Really excited for today and all the things that we're going to bring to our participants who are with us. First, I'd like to introduce our two distinguished panelists for today. In no particular order, I want to start with Lon Blumenthal. Lon is currently a Senior Project Manager at Nike and he's joining us from Beaverton, Oregon. Good morning. Lon, how are you?

Lon Blumenthal: Good morning. Very well, thank you.

Michael Hughes: Thanks for joining us. Appreciate it.

Michael Hughes: Next, we have Roman Sobieri. He's the Head of Global Shipping at Etsy and is joining us from New York City, I believe. How are you today, Roman?

Roman Sobieri: Doing great. Great to be here.

Michael Hughes: Excellent, thanks so much for joining us. So - about three years ago, Rensselaer at Work began an initiative. And that initiative was to get our finger on the pulse of what's happening in the field.

And we did that by talking to organizations, not just in the United States, but also worldwide.

And when we say 'in the field', what we really mean is what's happening in these organizations.

So on the one hand, we've used all our findings through this initiative to really redevelop all of our programs from the ground up. And the purpose of that is so that they meet the needs of the organizations that we've spoken to. And so really, this is a reciprocal effect here. One: we're able to provide abilities to employees so that they can accelerate the progress of the organization. But in doing so, we also hope to accelerate the careers of the employees who are working for these organizations. And so it's really a beautiful combination of effects.

The initiative is still ongoing and hasn't ended. We continue to engage and interact with organizations across the world. And we're doing that now digitally, as you know. And we've been able to connect with dozens of organizations, as you can see here - some of the organizations that we've been able to connect with not just peripherally, but really on a deep level.

We've also been able to connect with hundreds, if not thousands of folks cumulatively throughout these organizations. So, in addition to fueling our programs, being able to provide value back to the organizations who support our programs, and accelerate the careers of the employees who participate in our programs, we also felt an obligation to share what we've been finding as we've been talking to folks. And so, that's what really brings us here today for this Insights event, particularly in the area of supply chain and logistics.

Because the pandemic has really changed so many things in all of our lives for better and for worse, what we wanted to do was get our finger on what is happening most currently to the folks in the organizations who we connect with. And so we did that via a survey.

Aric, could you let us know what's going on that survey?

Aric Krause: Sure. Michael, I'd be happy to. As you know, in the months of October and November, we sent out a survey. Many of you joining us today took a few moments and participated in that survey, but what we wanted to do was precisely what you suggested, which is - get our finger on exactly what the issues are today - what the challenges are and where organizations are headed in terms of supply chain and logistics. So we sent out a survey. To date we've had 282 respondents. You can see on your screen there some of the different industries that have responded to that survey.

Various sizes: one of our primary partners when we talk about organizations that we formally partner with is in aerospace and defense. You can see a very large representation there.

But we also have partnerships and conversations with individuals in literally every industry, and not just in the United States. You'll notice on your screen that we've had responses to the survey from all over the world, basically because as we all know, supply chain and logistics today is a worldwide phenomenon, not just a local phenomenon. So we're very proud of that response. And we think that that response, and the breadth of that response gives us a really interesting insight. One of the things we asked our survey participants to do was let us know which parts of the supply chain process they were involved in. So you can see that on your screen right now.

On the left hand side, we use the formal six aspects of the supply chain flow and process and ask people - so you can see that we've got a really good representation across all of those different sectors, with the exception of the 'returns' aspect, meaning when products need to be returned and or reserviced or refurbished etc., etc.

But of the survey respondents - he 282 respondents, you can see on the right hand of your screen - how people identified their involvement in that process in terms of their level and position. So we were very proud to have many different respondents from the C-level as well as the VP level and the Director level.

So that kind of outlines the survey. We just closed the survey this morning, so we will be continuing to analyze those results and seeing what's in there that we can continue to share

Michael Hughes: Thank you, Aric. Looks like a really exciting result from the survey, thus far. Good response too.

Aric Krause: Yes, it was a good response and what we then did Michael - is we took this data over the last week or so, and we really started to divide it up and see what was in there - what results, what we were hearing in terms of what's really going on in the field. So for today, I kind of am going to highlight, not the raw data, but three insights I think that we can draw from the results. And the first one substantiates that there's been a significant disruption in supply chain, as we know, in 2020.

But what we wanted to get at in that survey is where folks suggest that they were most challenged in terms of their supply chain as a result of some of the events from 2020. So what we did is we took the responses, we gave folks the opportunity to choose from 13 different areas of their supply chain operation and process and asked them where they saw challenges currently. So on your screen here you can see we've summarized those by the frequency according to industry.

So for example, on your screen on the left hand side you see aerospace has identified - and it makes perfect sense when you think about it - has identified four factors of the thirteen that were primarily relevant for them, which was supply constriction, the falling demand, given the number of people who aren't flying and therefore, the number of planes, platforms, and frames that are being ordered - engines, so on and so forth.

As well as new technology. So you can get a sense. Oh, and by the way - new technology - I was combing through the results to see - this included issues around blockchain, data lakes, RFID, so on and so forth.

In terms of the different deploying and using those different technologies, was one of the challenges. So we can interpret this as for aerospace and defense, for example, they were trying to deal with the challenges of supply constriction, the issue of staffing and the ability of staff to react.

And in fact, you'll see here's four industries on your screen right now, Michael. I'll just quickly show you for additional industries. So I chose the top eight industries of the 12 that seemed to have the most significant frequency of problems identified

And you can see that across these eight industries. There's one consistent factor that came up consistently and this is this idea of staffing and ability to react. A different way to read that would be the ability of staff to react to the external stimulus, or the external challenge that was challenging their supply chain operation today. So this doesn't mean that we don't have enough people staffing, it means that our ability to react to some external force like COVID 19 and its effects really challenged our staff.

Does that make sense?

So I looked a little bit deeper in the data and what we can see - so I actually did a meta- theme analysis as well as this word cloud to kind of show you what's going on. And I think we can just draw a quick point out from this data, Michael, which is that firms had a disruption and it caused their supply chain - their current supply chain to be challenged. I.E. it may have been operating sufficiently up to 2020 but then these external issues have occurred. And now we see that the challenges in those supply chains became glaringly apparent in many cases, one of which was. This, again, this idea of the ability of our staff to react to the external force.

Michael Hughes: Ah, I see the logic chain there. So some disruption, and then these are some of the causes of the disruption, and then some of the symptoms of that disruption is what maybe we're seeing in the survey.

Aric Krause: Exactly. That's exactly right.

Michael Hughes: Gotcha. Okay, perfect. Well, you know, let's hear from our panelists and how they're experiencing some of these issues. Let's first turn to Lon. So Lon, you have over two decades of experience in implementing technology and supply chain processes and systems not just at Nike. In fact, some of the other notable companies that you you've worked with are Walgreens, and Blue Cross Blue Shield, Deloitte, and Accenture. Do you mind commenting on some of how these issues are presenting themselves at Nike today?

Aric Krause: Lon, you're on mute.

Lon Blumenthal: Okay. Testing one, two. Thank you. Technology is great when it works!

Thank you for inviting me to be on the panel with Roman.

In thinking about the data and this word cloud, it's very, very interesting. What I have seen over the years, with many, many clients. I've been consulting now 21 years both large and small.

The data that Aric presented was the ability to respond and be flexible. I would enlarge that a little bit. To me, it's really around the question of readiness for change - adapting to changing market conditions.

If supply chain hasn't had a seat at the table., I'm talking about the strategic leadership table of the company - the challenge is to get a procurement and supply chain to have a seat at the table to align with the strategic business objectives of the company.

And…

Aric Krause: Again technology works when it works.

Michael Hughes: Alright, it looks like Lon's point comes to the surface here - technology works well when it works. Let's get Lon a few minutes to get reconnected. But in the meantime, I want to make sure that we hear from our second panelist, Roman.

Michael Hughes: You too have many years of experience leading teams and executing on innovative solutions. And you too have done so at a variety of very noteworthy companies as well, including Pitney Bowes and Cheetah Mail, Fujifilm and Pratt and Whitney, so even some representation in the aerospace and defense industry as well. Would you mind commenting on what you're seeing at Etsy?

Roman Sobieri: Sure. Well, I mean, in regards to the big current pandemic situation you know Etsy is remarkably well positioned because of just the nature of it in that we're an entirely dispersed model.

We don't have single concentrated warehouses, you know, literally everywhere, it's everywhere. And so, you know, the opportunities for bottlenecks are much more reduced than you know if you're let's say limited to an area that's impacted particularly. So in that sense we've been in a good position in that as far as the changes you know? Yeah, this is a whole new paradigm for people and as I look at this from a consumer standpoint, literally overnight, it's changed from consumers being focused around one set of values versus a different set of values, where previously it was all about 'Where can I get the best deal, Where can I get free shipping?', suddenly it just converted over to 'can I get it?' now, and reliability suddenly became the key element to all of this, and it's a little like the plumbing in your sink, where you just turn it on, and you expect the water to come out. And it always does. So you don't even think about it, and suddenly when it stops doing it, you start to panic and so I think that's why a lot of consumers have gotten to the point where they don't trust the supply chain - rightly so - because it in many ways has been impacted, whether it's delays…

And so, you know, I think Lon commented about the technology and when it works. A lot of the technology was built, but it was never really pressure tested for the extremes. And so you see many extremely successful organizations have had situations where you let's say place an order for something and then they accept your money, you see it go, and then suddenly a week later, you get a message that says, oh, this item is not available.

That's not supposed to happen. You're only supposed to sell things that you have. So that's a data failure, not knowing what you have in your inventory in real-time. So things like that of a sudden became so apparent - all the weaknesses and the things that perhaps never would have come up and now, become the most important things. So I think, you know, having a good handle on those elements has become more of a feature than anything else, and the organizations that can keep that trust are the ones that would be the most successful in that. So I'll say maybe more important than having everything is being transparent about what's going on. And if you don't have something, don't represent that you do and don't try to. Don't try to fudge it because that's ultimately going to blow up in your face in consumer demand, in trust, in long-term loyalty

Michael Hughes: Thank you.

Aric Krause: Michael, a question came in. Can I throw it out to Roman?

Aric Krause: A question came in: You've had opportunity to work in very traditional firms as opposed to e-commerce firms. And the question has to do with - from a leadership standpoint, do you see a difference in the prioritization that leaders are giving in these newer - quote newer - industries versus the more traditional industries? Where do you see the difference in that, and how, how big of a role do you think that plays?

Roman Sobieri: With regards to logistics?

Aric Krause: Exactly, exactly.

Roman Sobieri: Yeah, no, absolutely. It really is night and day. You know, I think Lon did make a reference to that - that logistics is getting a seat at the table where previously they haven't. I mean new firms have to think about logistics a lot more actively. And having the benefit of building something from the ground-up, you know, within the last decade, within the last five years, has inherent advantages. In traditional organizations, you know, your supply chain systems are built on solutions that are perhaps 10 years 15, 20 years old, with API integrations and things. And so it's like a slow turning ship and nothing happens quickly. So, you know, you don't expect reactions very quickly. And so your supply chain elements are very buried into the organization under some other subcategory. Certainly you know in organizations like Etsy and Fuji, at any given moment, I can get a reach out from the CEO asking me what's going on with this? What's going on with that? So it's it a level of intense visibility and responsibility because they recognize that the consumer experience - it lives and dies based on getting the products on time and meeting the expectations.

Michael Hughes: Thanks for that Roman. Really appreciate your perspective there. I want to go back to Aric for a second and go a bit further into the survey. What else were you able to pull out of the responses?

Aric Krause: Excellent. I think this is going to really get close to the point that Roman just raised, so I'll be interested in seeing Roman, your response to this. The second set of questions that we asked people, is we asked them to evaluate different aspects of their supply chains' current performance. And we summarize those groups by functional areas, or dimensions as I call them on your screen right now -eight of them - eight different dimensions as well as - again by industry. So I'll show you those results here. I'll show you the first six industries and then I'll show you the second six industries and we'll start to see some commonalities between these various industries.

So on your screen right now you see a table that has columns that show the various industries. Again, six are on your screen right now. In the left hand column then, we showed the eight capabilities, or the eight dimensions of supply chain. So business processes - How effective are the processes within your organization that are set up to drive the supply chain and logistics processes? How strong are relationships in your organization between the elements of the supply chain? How strong is the communication between the elements of your supply chain? How often is data accessible, and how often is it actually used?

How is the performance? How would you evaluate the performance of the supply chain as a whole in achieving organizational goals? Whether or not it is optimized? Which has a little bit of a connection back to the data use and access. But, again, is it an optimized process? Is there a specific effort underway to make sure that what is happening is happening in an optimized manner? And then of course, visibility - and this Roman is again back to part of the point that you raised. How visible is the supply chain, how high of a priority? Visibility meaning priority and transparency in terms of how its performing. So folks were asked to evaluate this, and then we heat map those responses, Michael.

So you can see at the bottom of your left hand screen there, we gave them a scale where reds were when it was evaluated as not effective, and green - varying degrees of green - was more effective. So we then baselined this on a yellow as a neutral. Not bad, not good. Just sort of neutral. So you can look at this screen in two different ways. You can see first of all in the columns how aerospace and defense, for example - again, the number of respondents are aggregated up, these aren't company specific - but how respondents throughout that industry evaluated these different dimensions of their supply chain. You can see that some are neutral, some are light green, some are red. And then you can see the same in Chemical right here.

That's one way of looking at this chart is in the column - columnar form.

But you can also look at it in the row form, saying 'how are business processes across these industries?' in terms of how organizations evaluate the effectiveness of those business processes. And you can see that for these six industries, in essence, they're rated to be pretty good. So let me draw out two quick examples and then we'll look at the other six industries and then I can't wait to hear what Roman and hopefully Lon will be back by then - their responses to this. Let's look at finance, for example. Finance is in this column right here and you can see that folks in finance evaluated each of these different dimensions in some manner of green.

We could expect that. And we could expect that for a particular reason. The industry of finance is a very, very competitive industry. They're very dependent on data, I.E. if they don't have the right data, they're going to make bad trades, or they're going to make bad - they're not going to make money. So, given their high dependency on data and the high degree of competition in this field, and a little bit less reliance on external aspects of a supply chain, I.E. their vendors, or vendors' vendors - there's really not a lot of that.

There's clients, and clients' clients, but not necessarily the upstream. They rate their industry fairly green, whereas I'll pick on our own industry just for a moment, Michael - education, this is K-12, higher ed - all of it.

The whole industry hasn't had necessarily those same pressures on it to evolve so Covid-19 tended to be a little bit more impactful. So you can see in education, for example, business processes, the use of data, the optimization of how education is delivered is a challenge as an industry.

With those two examples, let me go to the next six industries on your screen right now. And I want to draw your attention to retail/e-commerce, because again, as Roman pointed out a moment ago, e-commerce for one is a very young industry, relatively speaking, and retail has been under tremendous pressure in the last 15 years. I mean, we see that, especially this year: tremendous pressure to optimize and perform at a very high level. So the youth of e commerce and the pressure on retail - formal retail -result in this being largely green as opposed to some other industries. But let me draw one more quick point out of this data that I think is really telling before we look for more responses. Look at the cross cut. The functional use, data use, data access, and optimization show up as potentially the three largest challenges for industries as a whole. Across industries, these tend to be the common problems. In fact, if you took out the lines 'data access, use, and optimization', there would be very little red in this chart.

And it's not just these six industries. In fact, when we pull up these other six industries you see they're primarily red too. So an interesting conclusion is that if you look at the top of this: business processes, relationships, communication - those are the leadership slash soft aspects of supply chain, whereas data access, use, and optimization, one could suggest might be a little more quantitative in nature. I.E. a little bit more math, a little bit more use of data generation. So we see kind of an interesting contrast between those two aspects. Companies rate the leadership soft aspects highly and the quantitative aspects lower as significant challenges across all of these various industries.

I think that's an interesting conclusion. I'd love to hear thoughts and reactions to that.

Michael Hughes: Great work, Aric. Thanks for providing that second insight from the responses to our survey. Let's turn to Roman first to get his reactions and see how he's experiencing things at Etsy around some of these issues that you brought up.

Roman Sobieri: Okay, well, in regards to the voting. I guess my first reaction has to be to demand a recount.

Sorry - been watching too many elections. Um, yeah, data is a challenge. And it really depends on what that data is. I think what we've been seeing in the last couple of years is a huge surge of pushback on the use of data, specifically, personal data.

Europe led the charge as you know, would be expected with the GDPR regulations. California has instituted a lot of regulations about data. And regards to personal data, the medical profession has always been challenged with HIPAA requirements and regulations, so the ability to use data in a meaningful but compliant way is actually incurring a lot of headwinds. And so, I'm not surprised to see it in certain organizations and areas. In education, how do you use the data without exposing personal data and the privacy elements? So, you know, yeah, that's, that's, entirely what I would have expected.

In certainly the retail and e commerce - e-commerce was born on data. And so, nobody in the organization is doing their job if they're not constantly reviewing data into what the behaviors are and how that is.

But certainly retail comes with the other direction, using the virtual data and e-commerce sales, combining it with their physical stores - it's been identified to be overused omni-channel language around that. I mean, for many organizations, it's like fitting a square peg into a pineapple.

It's not even a round hole. It's just something that is completely not compatible.

And so, they've been having to re-invent how they store data, they collect it, and use it. So, it's certainly an uphill battle. I think the successful organizations are the ones that have adapted quickly. To some degree, it's why you've seen so many dot coms pop up so quickly. Because they haven't been burdened with legacy systems and they can just start from scratch. So I'm just shocked to see in some areas where a little 5-person dot com e-commerce organization can pop up in the area where its full of legacy behemoths out there and be successful. And it's for that very reason - the ability to quickly and nimbly use data effectively. So, I think that's going to be a competitive advantage on an ongoing basis until those organizations can effectively leverage the massive amount of data that they have. And, you know, certainly the big ones - the Walmarts and the Amazons and you know, certainly Etsy - my organization and we're very good at it now, you know, but I think that's going to be an extreme factor in all of this.

Michael Hughes: Awesome. Thanks so much Roman for sharing that.

It is very interesting to see some of these small dot com businesses pop up and be successful due to their agility.

You know, I think that Lon was able to rejoin us. So I just, I want to say Lon, are you, are you able to speak now?

Lon Blumenthal: Testing 1-2. Oh, excellent.

Michael Hughes: Excellent. Well, Aric had just shared some of the insights related to perceived issues in the responses around data access and data use, but also some of the green that we're seeing - some of the effective business processes, relationships, and communications in the responses to our survey. So I want to make sure that you get some time to respond to those, and what you're seeing at Nike and throughout your career.

Lon Blumenthal: Okay, thank you. I apologize for the technical difficulties. I heard only part of Roman's response, but in general, the key aspect of data and optimization has to do around a single source of truth. Many companies have legacy technology. They're very complex. People use many workarounds or the old timers don't want to change the code - that kind of thing. And even if a company is swimming in data, sometimes there's little insight. There's little real knowledge. And in terms of a supply chain, and thinking about moving data up and down the supply chain. I would just emphasize that companies could do very well to start with a few key pieces of data - maybe having to do with demand signals, or supply signals, and build trust with their strategic suppliers - start to share a bit more information, regardless of the IT architecture that the company currently has, and build from there.

RFID tracking for inventory is a recent trend, and as customers order more, the inventory data, and the accuracy of the inventory data is really critical to help a supply chain get the correct product to the correct place that the customer wants it.

And then finally, I would just add: of course, there are many different types of workflows - make to order, make to stock, assemble to order, and engineer to order. And these different workflows have impacts to information systems, how they're configured, and the data that's available. So aligning the supply chain information flow to the company's business strategy is a very key element for optimizing supply chain data.

Michael Hughes: Thank you, Lon. If we can just go for just a minute back to Roman

How - you know you said that Etsy has been very successful in the use of data. And I'm just curious how, how does, how is leadership playing a role in that at Etsy? And if you don't mind, commenting on kind of that interplay?

Roman Sobieri: Well, I mean, I think the fact that the data is part of our DNA - it has to be -and being in a purely online organization, we have that luxury. So, everything that we do is iterative - we actually do several, if not 10s of releases and changes every single day in our solutions, and purchasing process and you don't do that, you know, especially when you're a multi-billion-dollar organization now without tapping data around that.

So you're release something and then you're testing it. You know you release it to a certain percentage of the consumers and you test to see what impact is that going to have? Is that going to hurt conversion, or improve conversion? Does it improve customer satisfaction, or hurt it? Before you release it, can you pull it back if it causes more harm? And, you know, certainly a significant number of the things that we release are immediately pulled back because it causes more harm, more confusion than benefit. You know, in that sense, so that data is all constantly recorded and it helps make accurate decisions. You'd be surprised at how many things are so counterintuitive. You think 'this is a great idea', and then you release a part of it. You find out. No, it's really not. Just unintended consequences - it confuses buyers or it causes them to have a different expectation than you really intended. So, just flying by the seat of your pants doesn't cut it anymore. And that's what the data helps you do is be able to initially predict what the impact of something is, but then be able to live-test it in real time and then react and pull it back if you need to.

Now that's really the power of data, aside from, the obvious of being able to use that to help the consumers like the on-time delivery expectations, in the speed of data being able to react when this particular supply chain, this particular country, this particular carrier, all of a sudden has challenges in Chicago and all of a sudden, anyone who's receiving orders in Chicago should expect to get things five days later. That's the kind of data that you need to have in place to maintain a consistent user experience.

Michael Hughes: Awesome. Thank you so much. Roman

Aric Krause: Michael, can I follow up with one quick question there?

Michael Hughes: Absolutely.

Aric Krause: When we were - and this just has to do with this data - so it's a convenient moment to throw it out about this data - we had a chance to review this data, just briefly, the other day with both Roman and Lon, and I found an interesting insight came up. And I'd like to ask you each to just share your thoughts about it real quick. And again, looking at it more from across all these industries as opposed to the exact industry. I thought we were all little bit surprised that relationships and communication were as green as they were given that some of these other challenges were as red as they were. I'm just curious Lon if you would take a moment or two, and respond to that, then we'll come back to you Roman as well if that's all right.

Lon Blumenthal: Oh yeah, can you hear me still? Yeah, relationships, I believe are the heart of a supply chain, and as the environment changes and different forces come to play around the world, relying on those relationships and communications - as I mentioned earlier - to build trust and to be able to share strategies and challenges to me is very, very important. Leaders - if all they do is approve budgets and attend kickoffs, in today's world that's woefully inadequate. They need to roll up their sleeves and work with their supply chain leaders, and other leaders of course in the company - up and down the supply chain - to plan for capacity and product inventories and the movement of those inventories as Roman was alluding to to be able to meet customer expectations, no matter what is changing out in the environment. And so communication and relationships to me are very, very critical.

Thank you.

Michael Hughes: Roman, your thoughts?

Roman Sobieri: Yeah, I mean as far as relationships and communication, those are optimizations for any successful organization. The interplay between individuals is critical when you're developing anything new and working together. You can't have an environment where someone is afraid to speak the truth and identify issues. You don't want all these solutions coming from the hippo - the highest paid individual. That that's not going to achieve the best results because they may be the highest paid, but they may not have all the insights. They may not be the smartest person in the room. And so you need the ideas to be freely flowing and not dependent on fear of retribution or politics. So building a culture of trust and mutual support makes the entire organization, much more successful and, you know, less likely to go down rabbit holes that they shouldn't. And then the communication - the bigger an organization is, the more challenges you have with the communication and to do it effectively.

You know, obviously we're all in a pandemic now. Many of us are working from home. And so some of these things have become more challenging to the world. Having meetings on Zoom rather than sitting next to each other and maintaining culture and communication during these times is an active process, and it's not just assumed that everyone will continue to communicate as well as they have in the past. So, you know, I think those are key elements but they're fuzzy because they don't go on a spreadsheet. No one says 'what's our budget for relationships for next quarter'. No, but honestly, they should. They really should because that's as a meaningful for the success as anything else.

Michael Hughes: Thank you.

Michael Hughes: Aric, do we have time for pulling out one more of the insights that you saw in the survey?

Aric Krause: Yes, we do. Thank you.

Aric Krause: This is kind of...Roman and Lon sort of led us right into this one right here. One of the questions that we asked in the survey also said - asked specifically what direction their organization needed - from their perspective in this process - what direction did the organization need to make - I'm going to, I'm going to use a word that I think Roman and Lon both brought up - to make our supply chain from the vendor to the client, all the way through - more resilient? And you can see on your screen now - again using meta theme analysis – it’s most easily visually represented in a word cloud - really shows those things that we need. The prioritization, we need the communication, we need the visibility - going back to our dimensions - the visibility on this very, very important value process. This is where the organization is creating the value. We need the highest-level support to prioritize it, get the data available where we need the data, but also get the communication flow, and the information going back and forth so that this thing can act optimally. I think both Roman and Lon also, I've heard them suggesting that all the data in the world, all the technological infrastructure to get that data is not a sufficient condition. It also requires a leader who can prioritize and bring about the evolution and or resiliency that that system requires

Love to hear responses to that statement.

Michael Hughes: Lon, do you mind to commenting first?

Lon Blumenthal: Happy to jump in. All those points are very, very key.

But my top line message, and my experience with senior management and leadership is that they have to learn with their teams, learn with their customers, and learn with their suppliers. We're all on a learning journey, especially with the virus and the changes in in global dynamics. Yesterday's solution typically doesn't meet today's need. And as I alluded to earlier, rather than just approving budgets and attending kickoffs, leaders need to roll up their sleeves and be okay with not knowing all the answers, but being okay with working with their teams cross-functionally within the company, and then cross-company in their chain to ask the important questions, explore options, and pick solutions that are going to optimize their business and their results.

Michael Hughes: Thanks Lon.

Michael Hughes: Roman, would you mind responding or sharing any thoughts you had on the findings from the survey - this final insight.

Roman Sobieri: Yeah, I think that's, you know, leaders really have to find as Lon indicated - they have to define the strategy - which direction is the organization going? What outcomes are the most important? And then help the organization define what are the proposals of value? What do your customers need?

And once you start with what your customers need, then let your teams come to you with how to achieve that. You know, what solutions can they offer to improve the customers' experience and make your product more successful, make it arrive in a more pleasant way to distinguish yourself from the competition in general. And I think so, to some degree, the leaders have to set up the framework, ask those right questions. And build an environment where the experts in each of the areas can come to you with their solutions rather than a top down approach, you know, is sometimes successful, you know, in the short term, when you're in a very focused, problem-solving mode. But in general, you need to have a wide bench.

And, if you don't, then you're going to have some single very successful solutions and some giant blind spots that nobody is looking at. And that's why the leaders need to give that breath of latitude to let the teams and individuals in their areas define how best to support those customer needs.

Michael Hughes: I see. It's funny you bring that up. I was, I was just - something popped up on my newsfeed just this morning - I think it was a quote that said "We don't hire smart people to tell them what to do. We hire them so they tell us what to do". Is that - is that similar to the idea of what you're speaking to?

Roman Sobieri: Much more eloquent than, and definitely more succinct.

Michael Hughes: Well I stole it from somewhere else.

Lon Blumenthal: I would just jump in and add - I remember something that Dr. Deming - W. Edwards Deming used to say - he used to say "good people are trapped in bad processes". And one of his 14 points, if you're familiar with Dr. Deming's 14 points - I forget which point it is, but it's drive out trust, which we've been talking to today, and applying that in a supply chain as you start with the end customer, and you just work backwards. Build the workflows, identify gaps and barriers, prioritize them, and then brainstorm solutions to address those gaps so that the workflow is much more efficient and effective in meeting the customer needs.

Aric Krause: That's awesome. And you're leading right into the final insight. I wanted to point out - because one of the elements in the comments section of the survey had to do with…

Yeah 2020 has really introduced - maybe let us see - that we have challenges in the resiliency of our supply chain processes, be it for legacy reasons, be it for whatever the challenge source is.

But we really have an opportunity. It really introduces an opportunity for us to-re baseline these things and recommit ourselves to making sure that they are serving the client to your points, and driving where it needs to be so that we're using data appropriately. And we're leading the way so that the chain leads to intended results. So we have a ton of really, really interesting questions that have come in. So is it okay if we ask a few, Michael?

Michael Hughes: Sure, let's take a few minutes and maybe we can solicit you know 30-second responses or so from our panelists, so that we, we make sure we're, we're getting wrapped up on time here.

Aric Krause: Okay, the first one. Michelle asks: "Is it all about the supply chain? Where does the customer come in to that? If you don't have customers, obviously you have to have a very different plan to push back to suppliers, hold inventory, cancel shipments"

And Lon, maybe you were just referring to this - Where does it - Where does the customer come up in all this discussion?

Lon Blumenthal: Yeah, the way I like to think about it is the voice of the customer - VOC. Sales people hear it very keenly, very loudly. If you go down into a - not to pick on engineers, although many of us here are engineers - sometimes on engineering teams, the voice of the customer is very hard to hear.

And therefore, bringing in multifunctional representation to make the voice of the customer loud and clear is the best way to design and improve the supply chain to meet the voice of the customer needs.

Aric Krause: Michael, Jay points out very well that we should include as one of our eight dimensions a ninth dimension, which is innovation. How innovative is your supply chain?

Jay, we will make that correction, because I think that's a fascinating point. Quick question for Roman – Roman…

Aric Krause: Michael asks: "To what degree do you see regulation as a barrier - be it trade, or government, you know whatever sort of regulation you want to talk about - as a barrier to a high performing and flexible supply chain?"

Roman Sobieri: Wow, that's such a timely question and it is absolutely a challenge because the regulatory environment is constantly in flux, especially, you know, cross border, but even, you know, even domestically in various regions. So whether it's new customs rules, that the data that you need to move items from one country to another, the flexibility of certain organizations to be able to adapt to those - They're gonna live and die by them. So this kind of plays into an earlier theme about relationships.

The regulatory issues - usually if you don't have good relationships in various industries - your peers, people in regulatory positions - then you're going to find out about them without time to react. So being able to hear about those early on, potentially influencing the outcome of those regulations - I've had some history in being able to do some of that, fortunately, but, otherwise you're going to become just a victim of it and somebody's gonna find out that 'hey, all my shipments have stopped because of this new regulation, that's our new tax' so that is absolutely essential, especially as we become more and more globalized.

Aric Krause: Love to hear both your comments. Michelle brought up the point that we may see the greatest challenge both regulatorily - I'll make up a word there - as well as logistically in the future rollout of a vaccine, given some of the temperature requirements, distributional requirements,

And I'd love to hear - again in 30 seconds or so - both of you respond to: If you are running that supply chain, that process of getting it from whoever the manufacturer is to the individual, what would you do to make that pull off successfully?

Lon Blumenthal: Yes, I'll be happy to go. As I said earlier, having a seat at the table is critical, and it really builds on what we've been saying about starting from the endpoint and working back. Capacity is going to be a key element for the distribution, and therefore all of the factors that are going to influence capacity: storage, inventory, transportation - all of these elements have to be thought through and really rigorous solutions need to be put in place.

Roman Sobieri: I wish I can add to that, but I think Lon got it exactly right. To work backwards from the recipients to define what the need is, what you're going to need where, and then work backwards into the storage and how you're going to get there as quickly and on time as possible.

Aric Krause: Awesome. There are a whole bunch of additional questions, but unfortunately we're a little bit on the time limited side. Thank you very much

For those questions. I did want to point out before we wrap up that as Michael alluded to earlier, we have had so many different conversations. The survey serves as another channel for data collection - for intelligence gathering really from our employer partners and from working professionals about these challenges, and I'm very proud to say that as a member of the Rensselaer at Work team, we have worked very hard as Michael stated earlier to develop programs that DO, that help people build the capacity to do the things we've talked about today. For example, we have the certificates that you see on your screen right now. These are graduate-level; they are for-credit certificates. I mean, they count for credit certificates. They can be completed in a year or less.

And an individual working professional, a leader could take these certificates in a year or less and build out that ability set that they need. If they see an opportunity to help improve who they are and how they present - I.E. achieving their professional goals. So I would encourage you to think about these certificates that you see on your screen right now. We're very proud as Michael said to have re-architected these things from scratch to be all about the act of learning. We believe that we learn by doing, learn through contacts, learn by seeing how things work in the real world and how they apply so students work on projects that give them not only the foundational ability, but also the experience of having done with colleagues from all over the country who are going to be in that course with them, with insight from their peers and from their expert faculty mentors who will be working with them. So if you see or you heard today, or you're thinking about an ability that you'd like to enhance in your professional portfolio, let's talk about that because we can help you with these certificates and with our accompanying degree programs - get that ability set that you want in an active, engaged, applied way in a year or less.

Michael

Michael Hughes: Thank you, Aric. Well, thanks everyone for joining us today. And thanks to our participants for also joining. I'm sure everyone's a bit Zoomed and WebEx-ed out so we appreciate your time and your participating in the session today. For more information on our programs or to connect with us you can just go to EWP - Education for Working Professionals dot RPI dot edu and we hope to hear from all of you very soon. Take care. Stay safe, and have a great rest of the year.

Lon Blumenthal: Thank you all.

Aric Krause: Thank you Lon and Roman. Thank you very much for joining us today.

Join Us for a Webinar

Apply Now

Professional Consultation

Questions?

Connect with us on LinkedIn
Back to top