Though it seems like yesterday, it was really more than 20 years ago that Federal Express came into my life in a big way. I took on FedEx as a customer and kept them as a customer for over 17 years. Working side-by-side with their people taught me a lot, and I learned firsthand what made FedEx so successful. Guess what? Almost all of the things that make FedEx successful can be applied to any company in any market.
CUSTODIAL POSSESSION
Strange at it may seem, FedEx became successful not because they guaranteed package delivery by 10:30 AM the next day, but from the application of a single revolutionary concept throughout the entire organization. That concept is known as Custodial Possession. It can be described this way: Once we pick it up, it isn’t YOUR package; it becomes OUR package. That makes US responsible for keeping up with it until it is delivered. WE have to do whatever we can to make sure OUR package is delivered.
Custodial Possession didn’t stop with the couriers, sort hub employees, pilots or drivers. It could be found throughout the company. Everybody from customer service operators, dispatchers, computer operators, network managers, even engineers knew that they played a role in delivering OUR packages on time.
That was a radical departure from the philosophy and business practices of other delivery companies.
Why would a concept like Custodial Possession be relevant to a warehouse manager or a manufacturer? Because there is a subtle difference between how you treat what’s yours and how you treat what’s not.
Talk to anyone who rents things from cars to apartments to TV’s and they all tell you the same thing: Nobody dishes out abuse like someone who doesn't "own" the item.
And it’s true. Rental cars with dirty diapers piled deep in the back seat of a returned car. Coffee stains on rugs. Bathroom fixtures ripped from the wall. Picture tubes smashed. The reason? An underlying feeling that because it’s not “MINE” someone else is responsible.
If it’s not MY car, then YOU are responsible for keeping it clean. If it’s not MY package, then YOU are responsible for getting it delivered. If it’s not MY inventory, then YOU are responsible for how it’s received, put away, picked or shipped.
Fred Smith realized for millions of packages to be delivered by 10:30 AM the next business day, everyone at FedEx had to be convinced that every package picked up, loaded on a plane, ran through the sorting system, loaded on the outbound plane, put on a truck and delivered was “MY” package. Delivering MY package overrides everything else.
It works. That commitment to delivering MY package is best illustrated by a story.
During my time working with FedEX, I saw a package get bumped off the sort conveyer. It was found and brought to the sort manager. (BTW, at the end of every sort the entire hub and flight line is inspected from top to bottom and end to end to locate any packages that may have been bumped off.)
The sort manager at FedEx didn’t have to think about it. He bought a first class ticket on the next commercial flight out to the destination city, put an employee on the plane with the package who then hand delivered it to the recipient. And it was delivered before 10:30 AM.
So, what does Custodial Possession have to do with inventory? Well, think about what happens to all those packages. An order is given for delivery. The item is picked up and delivered to the warehouse where it is received, accounted for and sorted. Then another order has it picked for pre-ship preparation, then it's moved to shipping, put on a vehicle which then delivers the item to the customer. At each step of the way, FedEx knows exactly where it is, where it's been and where it's going.
Do your warehouse operators, procurement managers and customer service people treat inventory as though it were THEIRS? Is everyone committed to making sure that inventory is ordered in the right quantities and delivered before it’s needed to fill orders or to move into manufacturing? Is it received carefully and checked against outstanding orders to ensure quantities and part numbers are right? Is inventory staged in such a way that put away can be done quickly and items made available for customer orders or movement to manufacturing quickly?
Or does inventory get a “lick and a promise” as my grandmother used to say?
When it comes time to fill a customer order, do your systems and processes ensure that the right product in the right quantities are picked, then carefully packed for shipment? Does your inventory management process make sure that not only what is being shipped is being shipped the way the customer wants it and when the customer needs it?
If you want to gain an unfairl competitive advantage, don’t emulate your competition, think about Custodial Possession and use it to set the bar way up high and keep it there. FedEx did and look where they are today.
Next Up: A SENSE OF URGENCY
Monday, June 28, 2010
Wednesday, June 23, 2010
Gloom and Doom for WMS?
In his June 15, 2010, editorial, Bob Trebilcock, Executive Editor of Modern Materials Handling said:
“The warehouse management system market is still a $1 billion market … but it was hardest hit among these three core applications (WMS, TMS, RFID).
Why the big drop? Just as end users are getting more mileage out of their lift trucks and conveyor systems in this recession, they’re probably thinking twice about upgrading or replacing a WMS system unless they have to.
Does a WMS deliver real results? Absolutely. But I think many users are going to try to make due for now.”
So, if you’re a WMS systems developer or integrator, the future must look pretty bleak right now.
Or does it?
True, a lot of companies in distribution and manufacturing implemented new ERP systems in the mid-2000’s. True, a lot of companies are “keeping it close to the vest” when it comes to anything new, not just WMS. And true, a lot of companies are in the “if it ain’t broke, don’t fix it” mode.
So why should manufacturers and distributors be bullish on implementing a WMS right now?
Time, competition, green initiatives and price.
TIME.
The downturn in the economy has given a lot of companies time to flush their inventories. It doesn’t matter whether the inventory is raw materials or components used in manufacturing or items on the shelf waiting for orders from customers, smart operators squeezed the pipeline in an effort to drive inventories throughout the supply chain down.
With inventories at record lows, they now have the time to look at the benefits they can get by implementing a WMS. Why? So they can continue to manage inventories at the lowest possible levels in the future. The smart operators know that they have the give of time to look at and implement a WMS that will give them greater control over their inventories.
COMPETITION.
Believe it or not, a lot of companies see this gift of time as an opportunity to gain a competitive advantage. Think of this: Going from paper orders to automated order entry eliminates errors, which eliminated picking errors, which eliminates shipping errors which creates happy customers. Competitive advantage.
Instituting automated cycle counting and min/max quantities based on order lead times, purchasing trends and quantity discounts, ensures materials needed for shipment or manufacturing are available when they are needed and in the right quantities to fill orders. The result? Lower inventory costs, which falls right to the “P” side of ledger.
Implementing real-time, wireless automated data collection from receiving through to shipping not only increases accuracy, but speeds order processing as well. End result? Increased productivity which means doing more with the same or fewer numbers of workers. Another competitive advantage.
Know what we call competitive advantage? Profit.
GO GREEN.
Everyone remembers the commercial where the group is sitting around a conference table trying to come up with ideas that will save $13 million dollars. One guy finally pipes up: “How much does all of this cost?” he says as he waves his hand across a table laden with charts, reports, printouts, graphs and books. “Could be millions” says the overwrought executive.
Is millions. Not could be. Is.
Paper is dangerous. It can be lost, misplaced, torn, faded, misfiled or shredded. Yet it is the blood that pumps through the veins of every company in the world. Smart operators are looking at the paper generated throughout the customer order, purchasing, receiving, manufacturing, quality control, put away, picking, staging and shipping process. Why? Because most of it is so unnecessary. With the right WMS system, like A3 Technologies Fontana IMS, paper is replaced with images, images that can be accessed by whoever needs them instantly. No more waiting for the inter office mail. No more “50 copies and a distribution list.” The WMS system eliminates paper and helps the company go green at the same time.
PRICE.
The relative cost to implement a fully integrated WMS system has been falling and is at its lowest point in years. Smart operators know that as the economy picks up, so will demand for WMS and so will the price. Now is the time to look at a WMS system that can deliver what they want, the way they want it and at a price they can afford.
To learn more, contact A3 Technologies about Fontana IMS.
Why the big drop? Just as end users are getting more mileage out of their lift trucks and conveyor systems in this recession, they’re probably thinking twice about upgrading or replacing a WMS system unless they have to.
Does a WMS deliver real results? Absolutely. But I think many users are going to try to make due for now.”
So, if you’re a WMS systems developer or integrator, the future must look pretty bleak right now.
Or does it?
True, a lot of companies in distribution and manufacturing implemented new ERP systems in the mid-2000’s. True, a lot of companies are “keeping it close to the vest” when it comes to anything new, not just WMS. And true, a lot of companies are in the “if it ain’t broke, don’t fix it” mode.
So why should manufacturers and distributors be bullish on implementing a WMS right now?
Time, competition, green initiatives and price.
TIME.
The downturn in the economy has given a lot of companies time to flush their inventories. It doesn’t matter whether the inventory is raw materials or components used in manufacturing or items on the shelf waiting for orders from customers, smart operators squeezed the pipeline in an effort to drive inventories throughout the supply chain down.
With inventories at record lows, they now have the time to look at the benefits they can get by implementing a WMS. Why? So they can continue to manage inventories at the lowest possible levels in the future. The smart operators know that they have the give of time to look at and implement a WMS that will give them greater control over their inventories.
COMPETITION.
Believe it or not, a lot of companies see this gift of time as an opportunity to gain a competitive advantage. Think of this: Going from paper orders to automated order entry eliminates errors, which eliminated picking errors, which eliminates shipping errors which creates happy customers. Competitive advantage.
Instituting automated cycle counting and min/max quantities based on order lead times, purchasing trends and quantity discounts, ensures materials needed for shipment or manufacturing are available when they are needed and in the right quantities to fill orders. The result? Lower inventory costs, which falls right to the “P” side of ledger.
Implementing real-time, wireless automated data collection from receiving through to shipping not only increases accuracy, but speeds order processing as well. End result? Increased productivity which means doing more with the same or fewer numbers of workers. Another competitive advantage.
Know what we call competitive advantage? Profit.
GO GREEN.
Everyone remembers the commercial where the group is sitting around a conference table trying to come up with ideas that will save $13 million dollars. One guy finally pipes up: “How much does all of this cost?” he says as he waves his hand across a table laden with charts, reports, printouts, graphs and books. “Could be millions” says the overwrought executive.
Is millions. Not could be. Is.
Paper is dangerous. It can be lost, misplaced, torn, faded, misfiled or shredded. Yet it is the blood that pumps through the veins of every company in the world. Smart operators are looking at the paper generated throughout the customer order, purchasing, receiving, manufacturing, quality control, put away, picking, staging and shipping process. Why? Because most of it is so unnecessary. With the right WMS system, like A3 Technologies Fontana IMS, paper is replaced with images, images that can be accessed by whoever needs them instantly. No more waiting for the inter office mail. No more “50 copies and a distribution list.” The WMS system eliminates paper and helps the company go green at the same time.
PRICE.
The relative cost to implement a fully integrated WMS system has been falling and is at its lowest point in years. Smart operators know that as the economy picks up, so will demand for WMS and so will the price. Now is the time to look at a WMS system that can deliver what they want, the way they want it and at a price they can afford.
To learn more, contact A3 Technologies about Fontana IMS.
Monday, March 22, 2010
Fontana™ IMS Automates Six Sigma Process Improvements
At the core of Six Sigma is the concept of continuous process improvement which can be measured in terms of higher quality products - evidenced by reduced customer service and warranty costs, elimination of waste and improved productivity through the elimination of unnecessary processes and procedures.
At the same time, Six Sigma defines Value Added Activities those items a customer is willing to pay for in the finished product. Everything else that is done in the manufacturing, storage, distribution and even sale of the product that does not add value to the product in the view of the customer can be (and should be) considered waste.
Eliminating that waste means simplifying, reducing or integrating activities to increase the value add, reduce costs and result in improved bottom line performance.
When a continuous improvement mindset is fostered and nurtured by employees at all levels, the result is a sense of ownership and accomplishment. When employees are actively engaged in identifying and eliminating unnecessary processes, workplace improvements happen faster and are more easily implemented.
See how A3's Fontana IMS automates Six Sigma process improvements from the receiving door through order fulfillment.
Monday, March 1, 2010
White Paper Part Two: Digital Imaging in Manufacturing
A new White Paper is available on the A3 website.
"The immediacy of digital imaging, not to mention the quality, has lent itself to hundreds of practical applications ranging from analyzing MRI’s to assisting in police work to being part of the evening newscast.
•In police work, digital images taken at crime scenes can be quickly transmitted to other law enforcement agencies and forensic specialists for immediate analysis.
•Digital images produced by an MRI can be shared on-line with specialists around the globe to assist with a diagnosis and prepare a course of treatment.
•Images captured at events on the other side of the world are instantly ready for publication in hundreds of news outlets just moments after they are captured.
With the number of practical applications growing each year, why hasn’t digital imaging caught on in manufacturing or distribution?
A quick answer might be that there aren’t any real applications for digital imaging in those industries.
That answer may be quick, but it’s wrong..."
Go to the White Papers section of our website for more about this story.
A3 Technologies, Inc. is a systems integrator. We are in the business of developing and delivering supply chain management solutions to customers in the distribution, warehousing and manufacturing markets. Our flagship software, Fontana IMS, is a fully automated, error-free, end-to-end inventory management solution developed specifically for those markets.
For more information: Shalonda Williams, A3 Technologies Tel: (704) 708-3871 Fax: (704) 708-8557 Email: sales@a3-tech.com
Website: http://www.a3-tech.com/
"The immediacy of digital imaging, not to mention the quality, has lent itself to hundreds of practical applications ranging from analyzing MRI’s to assisting in police work to being part of the evening newscast.
•In police work, digital images taken at crime scenes can be quickly transmitted to other law enforcement agencies and forensic specialists for immediate analysis.•Digital images produced by an MRI can be shared on-line with specialists around the globe to assist with a diagnosis and prepare a course of treatment.
•Images captured at events on the other side of the world are instantly ready for publication in hundreds of news outlets just moments after they are captured.
With the number of practical applications growing each year, why hasn’t digital imaging caught on in manufacturing or distribution?
A quick answer might be that there aren’t any real applications for digital imaging in those industries.
That answer may be quick, but it’s wrong..."
Go to the White Papers section of our website for more about this story.
A3 Technologies, Inc. is a systems integrator. We are in the business of developing and delivering supply chain management solutions to customers in the distribution, warehousing and manufacturing markets. Our flagship software, Fontana IMS, is a fully automated, error-free, end-to-end inventory management solution developed specifically for those markets.
Website: http://www.a3-tech.com/
Tuesday, February 9, 2010
VIDEO: Fontana™ IMS
A3 Technologies Introduces Fontana™ IMS. Fontana™ IMS is designed to streamline the inventory management process and facilitate implementation of Lean and Six Sigma process improvements. Using bar-code recognition to ensure accuracy, Fontana™ IMS also implements Honeywell imaging technology to add a new level of accountability. The Fontana™ IMS server and client software dynamically links images to orders and makes them instantly available to management. As an added benefit, Fontana™ IMS technologies can be integrated into existing ERP systems such as Oracle, SAP, QuickBooks and others.
Wednesday, February 3, 2010
A3 Technologies Launches Inventory Management System at Honeywell 2010 Solutions Fair
Orlando, FL, January 19, 2010 – A3 Technologies, Inc., a leading systems integrator and Authorized Honeywell ISV, launched their new inventory management software system, Fontana™ IMS, at the 2010 Honeywell Scanning & Mobility Solutions Fair in Orlando, FL. The new software, developed for the distribution, warehousing and manufacturing markets, features wireless, real-time inventory management using Honeywell mobile terminals.
Fontana™ IMS is designed to streamline the inventory management process and facilitate implementation of Lean and Six Sigma process improvements. Using bar-code recognition to ensure accuracy, Fontana™ IMS also implements Honeywell imaging technology to add a new level of accountability. The Fontana™ IMS server and client software dynamically links images to order and makes them instantly available to management. As an added benefit, Fontana™ IMS technologies can be integrated into existing ERP systems by Oracle, SAP, QuickBooks and others.
“With Fontana™ IMS, Honeywell now has a real-time inventory management solution for the manufacturing, distribution and warehousing markets,” said Alan Morris, Vice President of Business Development for A3 Technologies. “The Solutions Fair allowed us the opportunity to formally launch our Fontana™ Inventory Management System to a key player in the market. A3 Technologies solution can be the vehicle to drive increased sales of Honeywell Scanning and Mobility products through their channels.”
Joe Zvanut 704-708-3880
Director of Sales and Marketing
A3 Technologies, Inc
jmzvanut@a3-tech.com
Fax: 704-708-3557
A3 Technologies, Inc
Tuesday, February 2, 2010
Honeywell Scanning & Mobility Showcases Dolphin 9700 Mobile Computer
Honeywell Scanning & Mobility launched its Dolphin 9700 mobile computer at the NRF Big Show 2010 in New York City. The rugged handheld computer supports 3.5G GSM/HSDPA, 802.11 a/b/g, Bluetooth, IrDA, and GPS.
Additionally, the unit features Honeywell's Adaptus Imaging Technology 5.5 which reads linear and 2-D bar codes, captures digital images, and enables electronic signature capture, enabling workers to do more with a single device.
Finally, the unit also sports a color camera with Automated Programming Control, which provides integration of color picture and video capture into business applications.
Additionally, the unit features Honeywell's Adaptus Imaging Technology 5.5 which reads linear and 2-D bar codes, captures digital images, and enables electronic signature capture, enabling workers to do more with a single device.
Finally, the unit also sports a color camera with Automated Programming Control, which provides integration of color picture and video capture into business applications.
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