Session Information:

End-2-End Supply Chain Optimisation

Session Transcript:

Coming up next he's based on Bethlehem, Pennsylvania. But today, he is on Supply Chain Leadership Activities in Riverside, California. And I'm talking about the Great Jim De Vries. Jim is with us to talk about achieving supply chain, control through end to end visibility. Jim, please go ahead and turn on your camera. As I introduce you, give you a little bit of background to the audience about you.

Jim has served as a resilient enterprise executive leader, an advisor for companies, ranging from startups to Fortune, 50 organizations. He has held operational excellence, sales, and supply chain leadership positions in leading global companies, in the chemicals industry, with air products and chemicals in energy with General Electric Energy Security Tyco ADT, and supply chain with C H Robinson.

Throughout his career, he has developed and refined resilient enterprise ecosystems to accelerate digital transformation, innovation, leadership, development, strategy execution, and value creation globally. He believes that people make a difference and it is by harnessing people's talent that companies can become resilient, Jim. It's always a pleasure to learn and share with you. Thank you for taking the time to share expertise or a global audience today.

Thank you, Joe, as a Thank you, everyone, for attending, and I'm very honored to be here this morning and I'm looking forward to a really engaging discussion.

And good questions at the end, Please do document them.

So today we're going to talk about achieving supply chain control through end-to-end visibility.

Of course, as Josie said, people, process, data, technology.

It's all these that come together, and it's through this visibility that really drives our ability to control our supply chain.

So, we're going to talk a little bit about the importance of end to end supply chain, data visibility, creating some robust supply chain capabilities, some basics, and then we'll get into, from a risk management perspective, our supply chain risk model, that Supply Chain Risk Management Consortium, and has developed. And what we've developed from a risk appetite and operational propensity. So we're gonna bring you through supply chain and supply chain risk management during this webinar, so very excited to be here.

So some of the some of the key learnings today will be again, these end to end tools and techniques. We'll talk about the WTO recover that we announced at the onset of this. We are living that W Recovering.

And then we'll talk about some of the tools that we have out there, and at the end of the day, we have to understand, we all are all one global ecosystem.

I think some folks say, we'd like to be only within the four bore the borders of the U S, but in essence, we will we are global regardless of the geopolitical challenges that we have right now.

So, this is our, our go to slide from a strategy to execution perspective.

And we, the AIG, which is a group of 50 consultant consulting companies, and SaaS providers, are here to hone on the home companies, performance in these areas. So we got strategy, supply, chain, risk, and resiliency, priorities, intrinsic value, and operating structure. And this runs at a cadence. It's a little bit slower in the company, but needs to connect to the execution arm of what we talk about.

When we talk about supply chain management, when we're talking about supply chain management, it all starts with visibility, operational risk management, and enterprise risk and resiliency.

So we start with visibility. If you can't see it, you can't deal with it.

So what have we seen on the onset of this pandemic? A lot of people said, Oh, we're going to be able to make, you know, we're going to be able to react to this.

So what did people plan to do in 20 20 and what did they end up doing 12 months afterwards?

So this survey from our friends at McKinsey, that it's, it's a little bit dated, but it's still really put zeros in on what we're doing and what we're not doing.

So are we increasing inventory of critical products? while we plan that?

We plan to do that, but actually, we're increasing are our inventories, and it's a real challenge here, because we don't want to run dry.

So our supply chains are bulging.

And we all said, oh, we want to do dual sourcing, but doing dual sourcing takes time to set up a supplier, Not saying you shouldn't be doing it. But if you haven't done it yet, you'd better be doing it now and you'd better be looking for something a little bit closer to home.

Because we all know the world right now is turning inward and therefore our supply chains are, need second sources and they need to be closer to home.

As far as increasing inventory along the supply chain, we're seeing a lot of bulges in the. in the supply chain.

And then, of course, realizing the supply chain.

So we can go through all these, But the bottom line is some of these, especially the ones in blacks, are much harder to do than we would like to think, and, and our supply chains have been bulging.

And that kinda gets us right into the, the, the cartoon or the neural networking network model that we put together and that is, it's like a balloon. The supply chain is like a balloon and everybody's squeezing on it in different places. Sometimes it's good, sometimes it's bad, but everybody has a piece in the in this. So the customers hanging on and our suppliers are hanging on at the other end of the balloon.

So, no, you know, you may optimize your particular area, like the, The Lady in the gentlemen in the center.

But they may be happy, but everybody around them is a little bit frustrated, and finance is sitting there holding onto their life. And saying, Why are my costs going out of control? Why can't we deliver?

And, in our customer, people are saying, Why can't we deliver?

And inflation is going up, and our sales aren't hitting. What we expected to buy our orders are increasing, and everybody's kind of a little bit frustrated.

So if you can relate to that, that's what's happening, due to this, what we call the bullwhip effect that we'll get to in just a minute.

So, so, as it says here, you know, the C suite as a bundle nurse, this winner, new survey, shows that 72% of CEOs are worried about losing their jobs.

Why? Because a business or ..., so they're tracking closely with the 94% of the bosses that say that the corporate models need to be overhauled within three years.

So, that's broken supply chain.

So, we tried to do just in time and we tried to lean out everything and cut costs, cut costs, coq, cut costs, and that works when everything is nice and smooth.

As soon as you have a disruption, you, you're going to have challenges.

On top of that, we have trouble hiring workers and workers to stay with us, and then our IT networks aren't really built for supply chain.

They'll most AARP's were built for finance accounting. They weren't built for supply chains.

So activity based costing is not something that you're going to find in in many ERP is starting to today.

And a lot of hyper automation and different tools that are out there that you'll hear about in these couple of days with UI path and so forth, gives us the ability to see things much differently. So, we need, we need to make this data visible and repeatable.

So there's fantastic tools out there that are tools, and we've ever had to be able to battle this, this particular issue.

So, just getting back to basics, supply chain, operations, reference model, if you and your, everybody in your company should understand this model, we are all intrinsically linked together, as we mentioned earlier, and we need the plan, you see plan sitting on top.

A lot of people don't want a plan, they want to execute, no plan, no execute.

If you don't plan your execution, your chains are going to fall apart.

They're going to break and just like we saw the bicycle at the top of this webinar, your, your, your chains are going to allow you to deliver your product to your customers, and you know, you really have to be thinking about beyond the four walls of your company. You have to be looking up and down the supply chain.

A lot of people look only at the procurement side, but don't look at the customer side.

Or folks are focused on the customer side and not the procurement side.

You really need to be looking at both of those sides.

And the supply chain Operations reference model, which was developed by the Supply Chain Council, in the early two thousands, is fantastic. It's a fantastic tool. It's fairly inexpensive by ACM and it's it's out there for you, and I would highly recommend if you're not doing that as as well as ...

with ASM to get certified and that's not just we have to define supply chain as it's not Supply following its source, which is supply, make, which is your production and deliver to your customers and return.

So, even though we use the word supply chain, because the people who created this model were mainly procurement people, they kind of want out, but it really encompasses all all of those processes and, of course, planning, and linking from a strategic, to a tactical, to an operational windows. If you cannot link those windows together, you're going to have inventory going out of control.

And when you talk about the four walls, there's all these different areas.

And I don't want to spend a lot of time on this slide, but it's important that everybody, Pat, knows their role in managing that supply chain from from engineering.

To production planning, of course, and scheduling to management's decision, support, product service, customer support, distribution, order fulfillment, logistics, and supplier management.

Some of these are synonymous with supply chain, some, you may not think of product service as part of the supply chain, but it is, it absolutely is.

So, think of it as end to end of the value stream that runs your company, that produces the widgets that drives your earnings to the bottom line.

So, let's talk a little bit about some robust supply chain capabilities.

So we're going to start with the bullwhip effect, which is a classic, uh, something that you learned in supply chain.

And as it says there, the bullwhip effect is the uncertainty cause from distorted information, flowing up, and down the supply chain.

So you said, What did we expect to happen, and what actually happened?

So any uncertainty is caused by distorted information, flowing up and down the supply chain, is going to cause you pain.

And so we can look at the demand side and any perturbation from the customer end demand.

So if they over-order or under the order, or their timeliness is not ordering at the same time, as they always did, then you're going to get slugs.

And those slots are going to turn to the retailer, to wholesaler, to the manufacturer, to the supplier and it's going to perturbation, and let's get bigger and bigger and bigger to the supplier.

So, everybody starts chasing their tail.

That's on demand side.

On the supply side, it can happen the same way.

Where you have distortion relative relevant information and distortions to relevant materials, so from the foundry or from raw materials you use and say, all the way to hitting the OEM that's, that's building the product.

And from the OEM, the other direction.

So what happens is in supply chain Risk Management management, we talk about oh there's a hurricane that came by. We had a fire. We had a porridge.

Closure the ship gets stuck in a canal.

We're not making the right number of microchips.

All of those are Onesided and in the past we can deal with them but what cov it has done as disrupt in both sides.

So now, you're, you're not talking about a disruption of on only, on one side, you're you're talking about disruptions on both sides. So that's what's happening today, That's so unique, and that has caused that ripple effect up and down the supply chain.

And that's why we call it the W recovery, where you're going to have times are good, and times are bad.

And, right now, obviously, we're in that peak right now, Everything hitting that, hopefully, the peak.

People say, Is there going to be a bigger piece yet? That's the million dollar question, or we have to say, now $1000 billion question.

And, and now we're at that W recovery.

So, you're having these oscillations, and they're not lining up.

So the retailer to wholesaler and distributors, supply chains are now misaligned, which is causing these perturbations up and down the supply chain.

And so people are going to start whoring and we end up with way too much material and and right now in the US, for a lot of manufacturers as pent up demand was not the ability to get the materials over here.

From the ships, the ports are all full. So if you remember, about 6 or 8 months ago, there was a containers. We had too many Container empty containers. Now, we can't find a container.

So if you remember, about a year ago, there are two containers, you can buy, very cheap. Now, container is $10000. Before it was $200, So or $20,000.

So, because we we didn't, we didn't know where to put those containers because of that disruption.

So we just had a recent webinar just last week and we asked what are the challenges in managing the bullwhip effect?

And not surprisingly, the folks there came up with ease and we were just talking about it to demand uneven demand and uneven supply.

So it's that Bullwhip effect, and we can look at some of these other things that the folks brought brought up.

It's, it's not overreacting There's people overreacting to these things, there's changes, distortions Having skilled staff to be able to deal with these types of situations, and we alternative export adders and, and we'd overreact and and remember, people's people do remember if you do overreact.

So these are some of the things that different folks were dealing with that brought brought up during the Webinar just last week on this particular topic.

I thought I'd share that with you.

The next thing is what we've come up with is a Supply Chain Management Readiness Assessment.

We didn't come up with us yesterday. We came up with this 12 years ago with the supply chain Risk Management Consortium, when it EIG partners, long, low, longest partners.

And the consortium came up with their survey about 12 years ago, and has been using it in their education courses, And has the large benchmark of data, where we can do benchmarking.

We will be offering this available online, in the next couple of weeks, so that it, for free, you can go and perform this assessment on these 13 manufacturing tenants.

And, again, this is based on supply chain management, and not supply chain risk management. And we have both a server services perspective, as well as a manufacturer. We work with a lot of NGO's.

So the Consortium does, so by performing this, we can ask, you know, Are you best in class, so the graininess best in class, smaller, is better here, and then the gold is: you're on your way, and the red is getting started or fire, you know, your your hairs on for fire probably if you're operating in that area.

So, this is a quick assessment, it's free, can tell you what tenants you're good at, what temperature beta, of course it's all about: I know you're only as good as your weakest link.

So, we do believe in GNC basics, theory, constraints. So, this can at least give you a little bit of guidance. Are you on the right track from a supply chain management perspective?

So, there are tools like this. We're not the only ones. There's lots of tools out there on the market.

Very encouraging.

Encourage you to complete these type of surveys to make sure that you understand where you're at so you know where you're going.

So, just to change pace, just a little bit, going back to the W recovery and the three R's, we, we came up with this chart and we said that in the recovery, there's going to be three R's.

How you respond.

Are you going to be in recovery mode or are you are in the renew low mode on the bottom of the screen?

So, you're going to have a supply demand unbalance, you're either going to be oversupply.

Uh, oversupplied down here, sorry, and under demand, or over demand and under supply.

So we're going to be going through these perturbations quite a bit. And there's an, this is the perfect time to clean up your portfolio.

Take out the SKUs that are no longer good that are, aren't yielding good margins and low volumes, rescale your supply chain.

Make it work for you, look at new channels, and re-invent.

So the bottom line is, the companies that are able to get to renew the fast us.

Which is, and the only way to get there is to, you know, reduce your portfolio, rescale, re-invent your portfolio, and look at new channels, are the folks that the companies that are going to gain their unfair market share?

So there's some companies that thrive on disruption thrive on it and they will be gobbling up marketshare through this pandemic as these perturbations continue because they have complete visibility in their supply chain. They have that control tower look.

They have, they have their risk management in place and they are looking at risk and able to act and react to risks faster than the nearest competitor.

And that's going to make, or break companies.

And what we find is every company has, in the order of 11 or 12 risk events a year. This is pre pandemic.

And each risk event is costing the company to the bottom line $350,000. At least.

So you're talking in the order of $2 million that, you're going to two to $3 million that you're gonna lose off your bottom line, and we'll be going to the quarterly meetings, and saying, gee, that was a one-off event and will never happen again.

Those are those, those one-off events are the things that you really need to be focused on, and preventing, as soon as possible, so that you can gain your unfair market share. So, it's easy to say, it's harder to do, and that's That's why we brought these different tools for you.

So, we, we start off with our 21st century supply chain risk and resiliency model.

And in this model, we talk about, uh, on the X axis here, foundational.

These stages: foundational, visibility's sense and respond, risk management, and and sustain.

So, if you can't see it, you can't react, so where are you today, and where do you want to be?

So, you may be invisibility. You may be and foundational. You may be in predictability.

There's no right or wrong. It's just where you are. And What are you doing about it?

So, we encourage you two, you know, assess where you are on that continuum, so you can start building your improvements in our mantra, is, identify those threats, Assess them, mitigate, and manage. So, that's the cycle.

You'll be going through all all the way, until you get sustained, so people ask, How long does it take to get through this.

Wow.

There's companies that have been doing this for over 20 years exemplars, and like Zahra and so forth and and these companies Cisco.

And, and so these companies have been doing it for over 20 years and then they're still working on it.

And so, it's not something you just do and say, oh, we're going to do it and leave. It's something that you need to be committed.

And there's many different elements of that, and we'll talk about that in a few minutes.

But that's our Supply Chain Risk Management Consortium's risk and resiliency maturity model.

And it's served us well, been using it for over 10 years with different clients.

So so we I understand that this, this webinar series is about people and process.

So we thought we would try to incorporate some risk appetite and operational propensity.

And we'll talk about that. And these are more things that are a little bit more touchy feely. So unlike supply chain, supply chain, risk management is a lot about your risk appetite. How are you going to view risks?

Do you look at risk as an opportunity here or do you look at or do you look at risk is something you are?

So when there's a risk event, does everybody run for the hills? Or does everybody look at? Oh wow if we could turn this around we could actually beat our competitor.

So over over 10 years of surveys and and Customer coaching sessions, the Consortium's has developed it into these four different risk perspectives the pragmatist, the Conservatoire us, the managers in the maximizers.

So.

Let's look at each one of these.

So the pragmatists, they wait to the last minute. So on the X axis, you see risk management, decision tactics.

So these are folks that either do nothing or they wait till the very, very last minute to do make a decision on a risk of that shuttle.

Then the second is conservatories.

So they're concerned about avoiding the loss, and they need to be very careful to avoid the risks to the bottom line.

So there, don't wait till the very last minute, but they try to kinda, they're moving to that steering in that middle, That middle area, they're trying to move themselves into them.

So they're still, looking at risk is something they want to avert.

And minimize, but they don't want to take it on.

So those companies that are conservatives, conservators. And generally, the heavy industries tend to be more pragmatist and conservators.

Um, then, then, managers. So managers are the ones that like to try to balance risk and reward.

So they say, Well, yeah.

There's a tradeoff and they're starting to look at, they're able to say in their meetings, red is good. They like dashboards where there's red.

Conservators don't like dashboards with any red.

Pragmatists don't have dashboards or they ignore them.

They don't run by those. They run by their guts.

So, managers are very visible.

And I'm not saying conservators couldn't be visible and they can't indoctrinate the visibility. But generally they don't.

Pragmatists can be visible as you see on the left side but when they move that way to the left they're actually taking on more and more risk and and we'll talk about that in a few minutes but the managers are the folks that are the companies that are trying to take on risk and look at it. Risk rewards, the maximizers, are the ones that are just taking off.

They're looking at every risk event as an opportunity and they're gobbling up market share and all every perturbation, so, you'll see the Tesla, as you'll see, the, the, the big electronics companies, some of them, there'll be looking at these and say, Ah, man, another risk event, Cruz, who's going to go down? And I can go buy them because they're going to go under.

So, so, understanding who you are, it's not that it's bad to be a conservator. Or a pragmatist. So I don't want to come across it is who you are.

And you have to manage who you are and understand your limitations. And then try to manage your risk events going forward.

So that's a little bit about risk decision tactics, Then As we go, the third graph That we do in our survey is what we call operational propensity, And we call this the Kite.

What? What's the shape of your kite?

And there are four different endpoints there.

So we have You can be bureaucratic, you could be trapped or clannish. Some people don't like the word trapped.

Opposite of clannish maybe is startup.

And then the third or the fourth is Agile.

So you'll see that being bureaucratic and Agile are opposite.

So if you will often ask, who, What is a long pole in the tent? We'll put that at the bottom in this particular case It's they tend to be clannish a bit.

That means for each organization has its own little five times since so to speak And bureaucratic means that just takes law. A lot of layers of management Agile. Of course is what we all talk about. Being able to make agile decisions and startup.

As you're starting up with new new new new businesses all the time.

And so So again, the there there could be, Uh, A box.

Kite that is, is, or I mean a cake that is longer here.

Them and these shorter on these two ends and vice versa.

So So again, there's no right or wrong, it's just trying to say what's, how do you operate? What is the shape of your coin, OK?

So that's Ari, a pretty neat tool that we we look at so we asked questions about a 100 Questions survey and will will create your persona. So each company has its own persona.

So, in this particular case, this example is they have visibility.

They have their Prac Conservator and Burbach Skype or clannish box, OK.

So, so, from what that means is to say, you know, when we did the survey and, you know, and they, and then we asked them, What was their feedback? And they said, Yeah.

Yeah. We're at the beginning of our, our visibility stage in the middle of that. We're a global company, we have large, we have a single instance of sap. And we're looking to achieve sustainability as soon as we can.

From a risk appetite perspective, they're saying, yeah, we're pretty risk averse to make decisions we want to work with. But we want to work better together across our divisions.

So we're trying to move more to the right to make Make decisions. We just sponsor a new supply chain risk and resiliency executive position and we're moving into the less risk averse culture.

But we're reactionary. We do wait till the last minute. And there's a strong urgency to change this approach.

So, it resonated with them as a mirror of who they are. And, and then they said, Yeah, we're very bureaucratic and looking to change our data is siloed, making it difficult. And we are looking to be more well rounded, agile.

So, this helps us provide for each of the clients, their persona action plan, and for them, we just said, You know, we, we, again, you need to identify all your existing risk in your end to end supply chain, as we talked about before. Meaning, you're going to map and manually match your supply chain manually, and or digitally. And you want to identify are, of course, those key suppliers.

And you'll want to do an Altman Z score, which is a solvency test for yours.

Suppliers, very, very end customers, for that matter, who's going to pay, what's the likelihood they're going to withstand a pandemic.

And then you want to start using some of the, the basics of supply chain, risk management, risk priority, value at risk time, the recovery time to impact.

And then you want to subscribe to some kind of risk alert system and integrate that into how you make decisions today.

Then build a digital twin for your, for your product line.

So that gives you a little bit of a, a taste of what, what we're talking about, the consortium in, in building a action plan that is doable and manageable in the next 90 days.

So, a lot of folks who say, you know, Where's the money?

Everybody's asking where the money is, and so, some of the places where the money can be for supply chain risk management is cost reduction.

And you can see that in insurance premiums, we work very closely with insurance companies, and they very much like to see companies adopt supply chain risk management course that reduces the risk of having an event and a claim.

Then, through automated workflow, of being able to make decisions more efficiently and effective, we've seen cost reductions in the order of 10% cost avoidance, of course.

You know, putting in effective and risk detection and assessments.

You can easily see 17% in cost avoidance if you think that's important, and I think, as inflation rises, cost avoidance becomes more and more irrelevant, and, and so, we'll see more and more emphasis on that.

Working capital.

Again, cashflow, 95% of cashflow forecasting, you know, achieving that kind of level, freeing up your cash, is another big piece of the puzzle.

And track cash conversion cycle.

You know, we can see you don't normally see 10 to 20%.

And the Altman Z score.

So again, we've been working for, or the consortium has been working for over no, 12 years in the field, and in this area, and as the founder, Greg Siegle always says, Think big, Start small, and act fast.

So just like any other thing, do do your POC, your proof of concept.

And then build it out from there.

So that, that kind of concludes the webinar from what I had to cover, So that leaves us lots of time to ask questions.

I put together this presentation this morning, about three hours ago, so hopefully you found that interesting and josey, uh, open it up for questions.

Excellent, Jim, And that's what you get from industry leaders, is, you don't get a presentation from the year ago that they presented, because this industry is moving at an incredible pace, and you're getting the latest from this cross industry leaders here, through supply chain Planning Live. Outstanding presentation, Jim. Have several questions Related to the topics, I'm going to ask you to stop showing your presentation screen to the audience, so I can bring my camera back on.

And, and then we can go on the Q&A, here. So, I'm opening up the questions box here in my, my monitor, so please make sure that you asked your additional questions to Jim, to your context, what are the struggles? Are you having? What are the obstacles and opportunities that you have in your supply chains, and how you are, how you, you can benefit from the information that, that Jim has share with us here now.

Jim, one of the concepts that has come up, I mean, you talked a lot, about, a lot of different concepts, because, you know, supply chain, is a cross functional, multi concept discipline.

But one that resonated with the audience was this concept of being risk aware, versus risk averse, and the different types of, of leaders, or maybe personas that you have in the business. You know, you talked about the manager and the and the maximizer. You had a comment in that chart that was related to titles and positions in the in the organization.

What do you find should be the relative risk awareness and risk aversion built based on titles and organizations.

Does it get more or less as you go up and down? We'll talk a little bit about that.

It's funny, when you talk about it, that's a great question.

And, and, you know, as you, as you, you always say, there's two reasons that control your risk appetite. one is what job you currently have in the company and what have been your experiences and risk.

So, so, if you had a bad risk event in your life, then you're going to remember that.

But depending on where you are in the organization, if you're in finance now, and you used to be, you know, out in the field controller or you're in, and in a supply chain role, and you used to be in sales, or whatever it could be.

Or procurement, maybe your procurement went into sales, But it's, it's where your job is, Which is going to give you the, The, the most interesting perspective in what we find is, When we do our assessments, we ask that we gain the perspective of all those leaders sales, to procurement to engineering technology, production.

We want all of those people to provide, how they view risk and their company, and how they're managing it, in order to complete this. So, it's not the traditional supply chain manager or person filling this out.

It's, we need that cross functional team of your organization on how you make risk decisions, which is everybody barasa across the organization.

Did that answer the question?

Yeah. I just have a follow up on that. The curious about what do you see in terms of different roles, like, for example, I expect folks in finance to be naturally more like risk averse because, you know, their job is to control the numbers, they don't sometimes, it's really know what's going on. And operations. While someone in, the may be in business development may, be more risk aware, and maybe more of a risk taker. And I'm so There's that all functions. But what do you see in terms of ranking your organization? Does risk awareness and risk management gets better or worse as you get higher and lower in the organization from a hierarchy perspective?

It's funny.

That's a hard one. I think that's, I'd be scared to put it in generalities.

But, I guess if you would have to say, as you rise in your organization, you tend to protect, it's just our natural instincts.

And, and so, I think what happens as you get to the executive level, you, if you are very segmented and siloed organization, you're going to protect your five them.

You're a pillar of power, as we often say.

And so they tend to be more risk averse than the people who can see what's actually happening day-to-day.

They tend to take wants to take more risks.

But depending on how bureaucratic the company is, and how hard it is to make decisions, the people that actually could take the risk in a managed way, don't have the power to do so.

So it's not a really easy answer to provide, because in an Agile company, that those people would be making those decisions and taking the risk in a bureaucratic company, they will thrown up their arms and say, I can't do anything, I give up.

So it's not A It's not a one size fits all, but a great question. I don't know if that answered what you were looking for.

Know, I love that insight. I think you encapsulated in farewell First of all there's no simple answer to that question.

I think you, as you said, it's very context specific and culturally specific and that and because you're gonna see seals who are incredibly risk aware and they're taking. And there are managing risk farewell. And they're actually gaining credible value by managing risk better than others. Because that's the ultimate goal, right? You're gonna, he's not avoid the risk, but manage risk in a way that gives you a competitive advantage.

And then the flip side of that is that you have that hierarchical leader who got thereby, going into politics. And by doing all this little basic things right, and now he's protecting, or she's protecting their turf at the top and they become incredibly risk. They have a high risk avoidance because they're just kind of managing their position. And, and, you see that out there in the marketplace.

Know, in the, in the fairly, even distribution, I would say. So, let me migrate to something else. Lots of, by the way, good questions coming in, I'm going to try to get to as many of them as possible. But, let's talk about Lean for a little bit. I know you have tremendous expertise in Lean. We have, we have a great practitioners who are, on this call, as well, who have supply chain and ..., you know, knowledge and, and Lean can be looked at as the savior or or the villain for what's happening right now because recreated this incredible efficient supply chains of just in time.

And we seem to have forgotten that one of the concepts of lean was dealing with variable domain and variable supply. So selectively picked efficiency and flow. And we forgot about variable demand and variable supply. So, for those of us who understand the variable domain of variable supply, is that it should be a component of your, a Lean processes and systems.

Tell me a little bit more about that. You've talked, of course, during the presentation about variable demand and variable supply.

But how can a lean system absorb this variable demand and variable supply? What, how, what role does that play in the planning for for supply chain?

I don't know if you are, feels like you're almost answer to the question because, you know, and Lean, If, you know, in Deming you, go back to Deming, he.

variation is a huge, it's one of his tenants, so.

So, if you're of that nature, then you should always be looking at the difference between what did you plan to do and what you actually did, right?

And constantly questioning yourself on how to optimize that difference, and build risk mitigation strategies around that.

And when you do that, you can laying out your system, so to speak, from that perspective, But always looking at, that, you know, the difference between, that's the short answer to your question, is that OK, or you want more? That's that, that's a good answer, Because I want to move on to what Karen Kirby's asking about next, which is about technology. And you and I both know that great technologies are awesome, because they can speed up the processes. They can make your end to end supply chain, visibility and control. Like Digital Twins. You just mentioned can be great. But the wrong technology is also can make stupid happen at the speed of light. So, the question for you is, what do you see out there right now supply chain, that's just downright stupid and downright good? What is the difference between stupid and good out there? Right now that people are using our supply chain.

For a technology perspective, I think my biggest red flag and supply chain is the having a structured ERP that tells you what your process is because it's best in class, but it doesn't fit your market.

And then you implement the ERP according to the ERP constraints.

And then you're not able to serve your market and the flexibility of the market that Because, you're only as good as your nearest competitors.

If your competitors are providing and you're not, and you indoctrinating ERP.

That doesn't give you that flexibility To meet that market and supplier safire requirements then you've made a big mistake.

Now, the way to get around that, of course, is all these, I call them wrapper software's like hyper automation that you can, you know, put on top.

You can get the ERP. And then, if you map your processes truly end to end the way that they are, in way and in the way they ought to be.

And then if there are things in the ERP, which we do need an ERP, I'm not saying we don't, that you can use, you know, hyper automation, RPA you know, these digital twins, Emme alot of different technology to cover up for that.

But, my, my, my big thing is, always understand the process. Understand the variations in your process, like we just discussed.

And work to optimize that in the supply demand process is in the tactical planning, is the most overlooked area in most companies which drives the inventory out of control.

So without a good supply demand planning module, that is always looking at it and optimizing your, you're going to be in trouble.

I don't know if that answer that or not. That is a great answer and listen, that topic right there on the ERP and automation is something that we can discuss for an entire eight hours, so.

Great job, summarize that for us. Alright, next section as well, is going to be with the leader of industry solutions, and automation for UI path, which is doing a lot of the robotics process automation, and the ERP systems, kinda like combined work. So, we're gonna go a little bit deeper into this, into this topic next. But, Jim, I want to thank you for the behalf of our global audience. I know it's super early in California. You're always thought, an industry leader for offering this, global audience, and we very much, appreciate your, taking the time, to share your wisdom, and expertise with us today.

Thank you so much for having me. I really enjoyed it, and everybody, have a great and blessed day.

Thank you. Thank you.

Ladies and gentlemen, that was Jim de Vries, right there.

He is the managing partner for the Enhanced International Group. one of the Top Advisers for supply chain improvements, and innovations with over three decades of cross industry experiences and sharing that experience and know-how with us directly. We're going to be taking a break now, and we're going to be switching to, the next topic should be intelligent automation and supply chain and culture for transformation. So, next we're going to be welcoming, ..., who is a senior director of industry solutions for you. I path who's deploying robotic process automation at scale across thousands of organizations worldwide, Dubai, who's going to be sharing with us how automation is bringing value to supply chain management today. How intelligent automation is creating value for all stakeholders. So we're going to take a deep dive on that on the next segment.

Take a break now. Say hello to the folks who are putting the updates on LinkedIn. Look under, My name's Joe Zapier is on LinkedIn and you're gonna see that both for this conference Have updates from wrong Crabtree and Jim, the Breeze with just presented here. Say Hello to them. Say thanks to them directly, and you can connect with them directly by clicking on that LinkedIn post and looking at their direct connection. So for now, take a break. We'll see you back at the top of the hour with UI path.