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June 10, 2010, The Toronto Board of Trade Country Club

Reinvention in Business and the Supply Chain

As firms emerge from the recession they need to focus on how they can manage their transformation in a more constrained economy. How can they enhance their leadership capabilities to identify and apply new strategies to invent new and innovative business practices?

New strategies are often fraught with challenges. If you ask leaders that have recently overseen a business transformation, they will likely have a list of regrets that arise from hindsight; they might say they should have galvanized more internal support for a new vision, or tested assumptions about the marketplace and their business faster, for example.

A major challenge is that most business transformations need to take place quickly in order to succeed. Conventional business practices, however, in many organizations aren’t designed to accommodate these fast-pace changes. This can often derail innovative efforts.

Today’s marketplace has made it more challenging to implement breakthrough ideas. However, the worldwide recession has called on firms to find new ways to create value. Not surprisingly many firms are looking toward their supply chains to create profit and ultimately, shareholder value.

How can logisticians translate their efforts into meaningful and compelling arguments for change for presentation to the board of an organization?

Reimagining new ways to do business isn’t easy – especially as many executives are set on mitigating risk by using incremental steps rather than big ones. Busy executives often don’t have for innovative oriented meetings or focusing on potential breakthrough ideas.

LQ’s Symposium will offer a forum to look at pathways to reinvent and deliver new levels of supply chain excellence in today’s economy.

Agenda

7:00 a.m. – 7:50 a.m.
Breakfast & Networking

7:50 a.m. – 8:00 a.m.
Welcome & Opening Address

8:00 a.m. – 9:15 a.m.
CASE STUDY & PANEL DISCUSSION: Leveraging Logistics Strategies and New Tools in Today's Uncertain Landscape (For more information please see the Session Notes below.)

9:15 a.m. – 9:45 a.m.
Executive Exchange (Q & A)

9:45 a.m. – 10:00 a.m.
Refreshments & Break

10:00 a.m. – 11:15 a.m.
PANEL DISCUSSION: Creating Innovative and Strategic Corporate Alliances (For more information please see the Session Notes below.)

11:15 a.m. – 11:45 a.m.
Executive Exchange (Q & A)

11:50 p.m. – 12:25 p.m.
Networking & Cocktail Reception

12:25 p.m. – 1:35 p.m.
Lunch

1:35 p.m. – 2:15 p.m.
Introduction & Luncheon Speaker

2:15 p.m. – 3:45 p.m.
CASE STUDY & PANEL DISCUSSION: How Supply Chain Excellence Creates Shareholder Value (For more information please see the Session Notes below.)

3:45 p.m. – 4:05 p.m.
Executive Exchange (Q & A)

4:05 p.m.
Concluding Remarks

Session Notes

Leveraging Logistics Strategies and New Tools in Today”s Uncertain Landscape

Yesterday, the solution was straightforward; firms purchased more and kept their warehouses well stocked. Today, logisticians focus more on purchasing smaller quantities, identifying what’s moving and replenishing what’s selling. What are the implications for today’s logisticians and shippers for international supply chains that can quickly change everything from lead times to costs, schedules and shipping capacities?

The "new normal" is a term that has been used in several recent logistics and supply chain conferences to describe how supply chain practices are functioning in a new international environment.

This approach has resulted in greater information technology (IT) investment especially given current supply chains with Asian intermodal shipment capacities diminished, unstable fuel costs, and a call for more firms to conduct due diligence on their suppliers’ financial health to mitigate risk. All of these elements are compelling more organizations to leverage logistics planning. Here’s an opportunity for practitioners to share their insights on some important questions:

  • What are some of the new strategies and processes that businesses have developed to provide better efficiencies in 2009 – and continued to apply this year?
  • Where are you focusing your efforts in warehousing/distribution and the supply chain generally to control capital expenditures?
  • What will be your biggest supply chain win this year – and what was it in 2009? What is your key service focus for 2010?
  • Does the cost of fuel cause you concern – and if so, is it prompting your firm to look at closer at procurement and replenishment patterns?

For many firms, supply chain network modeling remains a priority even during a downturn. In relation to other IT investments, such as enterprise resource planning, or a new distribution centre or a ship, the costs are modest. This session provides an opportunity to learn how firms are transforming their traditional distribution/warehousing models.

Creating Innovative and Strategic Corporate Alliances

Corporate alliances fail up to 50 percent of the time, according to a recent study by McKinsey and Co., which is worrying because many firms depend on corporate alliances to innovate and grow.

Why do these alliances often produce lackluster results, or fail? Often it’s because they follow a traditional and tactical approach. They focus on Service Level Agreements instead of visionary and innovative approaches to the business. They are dedicated to operational excellence and execution outlines in SLAs instead of reaching across operational boundaries to achieve strategic objectives. This session encourages companies to switch from operational strategies and operations to a new visionary approach.

In 2006 at a Chicago-based luncheon, prepared by HBR and UPS, A.G. Lafley, then the CEO of P&G, presented on supply chain practices and innovation. He shared the view that an innovation program could be applied and run in a similar way to a factory; with inputs and measurable outputs and tools to measure and manage the risks often associated with innovation. And at that time he told us that up to 50 percent of P&G’s innovation would likely come from outside of P&G in its drive to acquire $50-$100 million in innovative ideas annually.

A.G. Lafley offered the view that “innovative leadership demands that we see the supply chain not as a series of cost centers but instead view the supply chain as a critical enabler of innovation.”

As many companies turn to 3PLs for innovation they should also be mindful of forecasts for new alliances in the field. It’s estimated that the largest 3PLs control an estimated 15 percent of the outsourced U.S. logistics market, which means a lot more consolidation will likely occur, particularly as the economy improves. Some experts have forecast there will likely be a significant rise in the acquisition of niche 3PLs by large players as well as more strategic alliances.

This session will offer a unique perspective of innovative practices at companies such as P&G, and the Canadian healthcare industry, and 3PLs, as they adapt to change, often through strategic corporate alliances with outside organizations to help them achieve their objectives and mitigate today’s challenges.

How Supply Chain Excellence Creates Shareholder Value

Does your firm deliver products to customers at the right time, and price – and at the lowest cost and amount of working capital? If not, you're probably loosing business and customers, and diminishing shareholder value.

A growing number of firms are looking at supply chain finance as something that has been likened to a sweetener for Logisticians and 3PLs alike in the drive to create greater shareholder value. For example, when a major telecom company decided to extend their accounts payable time it knew suppliers would object. However, it didn't propose to make this transformation unarmed. As it adjusted its payment terms to 90 from 45 days, it found a tool called supply chain finance to help sweeten the arrangement for its suppliers.

The primary ingredient in supply chain finance is its allowance for both the buying company and the supplier to improve their working capital. Leading companies such as Nestlé and truckmaker Volvo have successfully applied supply chain financial practices.

This enables the firm buying the services of a 3PL to pay later, which allows it to hold onto its money for a longer period of time. Suppliers have visibility to their invoices online and their status sooner, enabling them to sell their invoices to a bank after the buyer has documented their approval. This enables firms to receive their payments months ahead based on a fee paid to the bank for this service.

Both sides improve their working capital and the banks are rewarded with their fees for service.

Today, many supply chain experts view supply chain finance as one more way to develop more flexible and dynamic business relationships with suppliers.

This presentation will provide new perspectives on opportunities to create excellence in your supply chain practices and examine ways to reinvent your supply chain to create value for customers and shareholders alike.

This session will include a presentation that focuses on how to apply powerful levers of supply chain excellence:

  • Putting the best people in the right positions
  • Applying supply chain technologies such as visibility tools
  • Eliminating silos in business practices
  • Collaborating with suppliers and customers
  • Managing supply chain projects

LQ's Gold (2014) Symposium Sponsors
BCG C.H. Robinson Worldwide, Inc. GENCO GENPRO GENCO
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