November/December 2017

Going Executive Outlook Trends to watch, p 20 bananas Drones Inside Walmart’s Hype or promise? p 26 giant new DC, p14 Managing recalls p 28

ALSO INSIDE 3 TAKING STOCK 4 SUPPLY CHAIN SCAN 30 INSTALLATION INVENTORY 35 LEARNING CURVE 37 LEADING EDGE

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Visit www.dematic.com or contact us at [email protected] or 1-877-725-7500. TAKING STOCK People matter www.mmdonline.com obots, drones, artificial intelligence. These technologies Rare making headlines in supply chain lately, with their EDITOR: Emily Atkins promise of faster, more efficient operations. The theory is (416) 510-5130 [email protected] that flawed, error-prone humans need to be supplanted—or CREATIVE DIRECTOR: Tim Norton (416) 510-5223 [email protected] at least supplemented—by error-free, tireless, uncomplaining and unpaid automated workers. ART DIRECTOR: Barbara Burrows From a purely bottom-line perspective this makes sense. PUBLISHER: Nick Krukowski (416) 510-5108 [email protected] If you can eliminate the wild card—the vagaries of the human creature with its big brain, uncontrollable nature, PRODUCTION MANAGER: Kimberly Collins (416) 510-6779 [email protected] and inconvenient need to sleep, eat and socialize—the work process gets a lot CIRCULATION MANAGER: Mary Garufi simpler. No more scheduling headaches, no worries about increases in the minimum (416) 614 5831 [email protected] wage, no attempting to overlay demand planning on the human resources available, and no need to hire and train temps for peak periods. NEWCOM BUSINESS MEDIA INC. Chairman & Founder • Jim Glionna Sounds idyllic. The lights-out, fully automated DC hums along smoothly, 24-7, President • Joe Glionna filling orders, receiving and putting away goods with 100 percent accuracy. But it’s not that simple. As I have mentioned before, achieving this type of HOW TO REACH US: operation may be feasible, and it has been done, but it remains the preserve of the MM&D (Materials Management & Distribution), established in 1956, is published six times a year by Newcom Business Media Inc. very large corporation with a relatively stable operation, and deep pockets.

EDITORIAL AND ADVERTISING OFFICES: For the rest, the human worker is not going to be obsolete any time soon. Supply 80 Valleybrook Drive, Toronto, ON, M3B 2S9; Tel: (416) 442-5600; Fax (416) 510-5140. chain managers will continue to face the challenges of human resources that are part of the reason behind the push for automation. Witness our Executive Outlook SUBSCRIBER SERVICES: To subscribe, renew your subscription or to change your address or information, contact us at section, starting on page 20 this issue. Although we divided up our take on trends 416-510-5113 or 1-866-543-7888 ext. 3258, or visit our website: www.mmdonline.com/subscribe and issues, in each case the availability of skilled labour remains top of mind. Being able to find and hire enough workers with the right education and skills SUBSCRIPTION PRICE PER YEAR: Canada $84.95 per year, Outside Canada $159.95 US per year. is a major driver in supply chain decision-making. Locations, operations planning, Single copy price: Canada $15.00, Outside Canada $32.65 CDN MM&D is published 6 times per year except for occasional combined, risk management, and customer service—all these need to take the human factor expanded or premium issues, which count as two subscription issues. into account. ©Contents of this publication are protected by copyright and must not As a counterpoint, check out our lead news story on page 4. Turns out millen- be reprinted in whole or in part without permission of the publisher. nials love their supply chain jobs. And if you find that interesting, it’s only a short DISCLAIMER: This publication is for informational purposes only. You should not act on information contained in this publication without wait until we reveal the results of our 2018 Survey of the Canadian Logistics seeking specific advice from qualified professionals. MM&D accepts Professional in our January-February issue. Stay tuned forfor detailsdetails onon salaries,salaries, no responsibility or liability for claims made for any product or service reported or advertised in this issue. MM&D receives unsolicited working conditions, job satisfaction and more. materials, (including letters to the editor, press releases, promotional items and images) from time to time. MM&D, its affiliates and assignees may use, reproduce, publish, re-publish, distribute, store and archive such unsolicited submissions in whole or in part in any form or medium whatsoever, without compensation of any sort.

PRIVACY NOTICE: From time to time we make our subscription November/December 2017 • Volume 62 • Number 06 list available to select companies and organizations whose product or service may interest you. If you do not wish your contact On the cover information to be made available, please contact us via one of the following methods: Walmart Canada’s Curtis Brumfield (on the left) and Drew Robertson with some of Phone: 1-800-668-2374, Fax: 416-442-2191 the retailer’s most important product at its new DC in Cornwall, Ontario. Story on Email: [email protected] Mail to: Privacy Office, 80 Valleybrook Drive, Toronto, ON M3B 2S9 page 14. (Photo by Jason McNamara)

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Outlook Drones Recalls Installations A peek at trends Will we ever see Using software to Robots, racking affecting logistics last-mile delivery manage recalls and AGVs management now by unmanned aerial and achieve improving and in the future vehicle? compliance warehouse ops

www.mmdonline.com | November/December 2017 3 SUPPLY CHAIN SCAN

3PL M+S UKRAINE TRADE UNSOLD

Adaptation is key says Appointments and Canada’s little known trade agreement with Ukraine Preventing unsaleable annual report, p 11 promotions, p 13 is now in force, p 6 goods, p 9

Millennials see supply chain jobs as rewarding

By MM&D Staff

illennials are focused, engaged, Menthused and committed to working in supply chain management; supply chain represents a sought-after, dynamic and rewarding long-term career choice for profes- sionals in their 20s and 30s. These are among the key findings of APICS’s Millennials in Supply Chain research report, conducted by Peerless Research Group in conjunction with Supply Chain Management Review (SCMR) and the American Productivity & Quality Center (APQC). “The results of the report are eye-opening, especially when compared to the more senior supply chain professionals in leadership posi- tions, who were part of a previous study from APICS and SCMR in 2016,” said APICS CEO, We see that more career ladder. Abe Eshkenazi. “We see that more millennials millennials started This disparity is chief among complaints started their career in supply chain, are mov- their career in supply from millennials surveyed, along with frustra- ing around less, are highly satisfied with their tion around the attitude towards millennials jobs and see more opportunities for advance- chain, are moving around by older generations in their organizations ment in the field.” less, are highly satisfied and a disconnected feeling from the big pic- The report shows millennials have a with their jobs and see ture or a lack of purpose in the workplace. diverse interest in activities that span the more opportunities for “Despite some noted frustrations, millen- end-to-end supply chain. Notably, the area ‘‘advancement in the field. nials are continuous learners and fast movers that holds most appeal, supply chain design who are eager to advance,” Eshkenazi con- and planning, is a role that touches all areas cluded. “To address the ongoing skills gap, of supply chain. industry expectations, priorities and com- The millennials surveyed also said they more women are now entering the field also munication styles must adapt to and embrace find their careers personally rewarding. reflect. Respondents were roughly two-thirds the different needs of this younger genera- Eighty-one percent feel they can make a dif- male (61 percent) and one-third female (39 tion. Millennials are growing and learning ference in the supply chain field, 87 percent percent), compared to the 2016 survey of on the job in an era of lean, optimized, end- believe working in the field will help with senior supply chain leaders, in which 76 per- to-end supply chains and are critical to the their personal growth and development, and cent of respondents were men while only 24 ongoing transformation of the industry.” 88 percent agree that there are opportunities percent were women. Results of the survey are based on 676 for advancement within the field. However, just as earlier research of senior respondents working in supply chain man- Diversity topped the list of what millen- managers in 2016 showed a pay gap between agement who were pre-qualified for being nials consider most important. Eighty-five males and females, there is a gender wage between the ages of 22 and 37, born between percent noted that supply chain involves a gap among millennials. Men and women 1980 and 1995. At a 95 percent confidence diverse workforce and encompasses people start at roughly the same salary, but the dis- level, results are projectable at a margin of

of all types, which additional findings that parity grows larger as they move up the error of +/- 3.8 percent. MM&D iStockimages.com alvarez; Photo:

4 MM&D | November/December 2017 SUPPLY CHAIN SCAN CITT elects 2018 council for GTA

he CITT Toronto Area Council (TAC) Solutions (a Contractor of Yusen Logistics). sary award is Joyce Xu, CCLP, an analyst at Thas elected a new council for 2018, to Michael Gomes, CD, CCLP, CSP, CTB, a CN. Mike Upwood, CCLP, president of be led by chairman Duane Chiasson. All the 3PL broker, is vice-chair. The treasurer is Marbro Logistics Inc, is the golf tournament members were acclaimed. Cornelius Wong, CCLP, a recruitment con- manager. Grace Di Marca, CCLP, CCS, CTCS, “I am very much looking forward to chair- sultant at SCL Search Consultants Ltd. is national manager of the Tariff Support ing the council for another year. I am also Shaukat Khan, CCLP, manager of consulting Unit, Customs Consulting at Kuehne + Nagel excited that there is a good mixture of new at Farrow Consulting is secretary. The events Ltd. and will be the board’s CSCB Liaison. faces and true veterans returning and some coordinators are Demi Todorov, CCS, CTCS, “Participation locally is an extension of students,” Chiasson said. CCLP, a Customs compliance consultant the CCLP designation, not only to achieve “I also wish a fond farewell to Tom Pauls with DHL Global Forwarding (Canada) Inc Certification Maintenance Units (CMUs) who is stepping down completely from coun- and Victoria Jones, a logistics coordinator but it also allows us to be in front of supply cil activities. Tom has served the council in at Cambrian Solutions. chain and logistics communities in holding one capacity or another for at least 12 years, The following were asked to sit on the events such as tours, workshops and speakers three of those years being Chair. Tom has council as Members at Large because of ongo- series, allowing us to network personally on certainly left his mark on the council and ing commitments from TAC 2017: Millie Jie a scale unequaled in our small community,” much of the success can be attributed to his Leng, lead hand, Customs brokerage, DHL Chiasson continued. hard work. Also moving on will be Bill Carter Express (Canada) Ltd. will be responsible for “The farther the reach of the CITT vision who has graciously served as secretary for the Holiday Helpers Wrapping Night. Denise through the area councils the more relevant the past two years.” Ponte, CCLP, in business development at the designation becomes and the more value Chair Duane Chiasson, CCLP, is in busi- Effective Logistical Solutions, will be the is brought to the designates’ own personal

Illustration: Damaratskaya Alena; iStockimages.com Alena; Damaratskaya Illustration: ness development at Effective Logistical Holiday Helpers Liaison. Handling the bur- brand.” MM&D

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www.mmdonline.com | November/December 2017 5 SUPPLY CHAIN SCAN Canada’s unsung trade agreement

By Christian Sivière year phase-in period for automobiles. Ukraine introduced, namely the Ukraine Tariff on the other hand, has granted duty-free (UAT) code # 32, to enable the Customs CUFTA, the Canada-Ukraine Free Trade access to Canadian products immediately on clearance of inbound shipments in Canada. Agreement, which came into effect on August 72 percent of tariff items, and provides tran- Entitlement to the Ukraine Tariff is deter- 1, did not get all the attention it deserved, as sitional periods of one, three, five and seven mined in accordance with the rules of origin it happened shortly after the Canada Free years for 27 percent of tariff items. set out in Chapter 3 of the CUFTA. As with Trade Agreement between Canadian provinces The CUFTA also opened government pro- every Free Trade Agreement, a certain per- and territories on July 1 and just before the curement to companies from both countries, centage of non-originating products is long-anticipated Free Trade Agreement with giving them non-discriminatory access to bid allowed, in some cases, providing sufficient the European Union on September 21. on public airport, railway, mail and public transformation of a product takes place, With the exception of a few agricultural transportation projects. In this context, evidenced by a shift in the H.S. code. goods, the CUFTA essentially eliminates Ukraine has recently opened an online public Product-specific rules of origin are found Customs duties on most products, either imme- procurement platform called ProZorro, with in Annex 3-A and organized numerically, diately or through a tariff phase-out period. the objective of providing equal, fair and similarly to NAFTA’s Annex 401. Canadian The duty elimination process, however, is transparent treatment to all bidders. exporters must familiarize themselves with asymmetrical, as Canada has opened its mar- The Canada Border Services Agency these rules to determine if their products ket immediately for 98 percent of tariff items, advised the trade of the implementation of comply and will obtain the lower Customs both industrial and agricultural goods, with the CUFTA for August 1, as well as providing duties in Ukraine. Unlike NAFTA, which only a few exceptions: 108 tariff positions in links to the tariff provisions, proof of origin requires a separate Certificate of Origin on a poultry, dairy products, eggs and egg prod- and shipping requirements. specific form, the required proof of origin ucts, cheese and sugar. And there is a seven- A new preferential tariff treatment was under CUFTA is an Origin Declaration incor-

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Old Dominion Freight Line, the Old Dominion logo, OD Household Services and Helping The World Keep Promises are service marks or registered service marks of Old Dominion Freight Line, Inc. All other trademarks and service marks identifi ed herein are the intellectual property of their respective owners. © 2017 Old Dominion Freight Line, Inc., Thomasville, N.C. All rights reserved. SUPPLY CHAIN SCAN porated in the seller’s commercial invoice. A DONE DEALS model declaration can be found in Annex Liftow, Toyota’s largest forklift dealer in North America with 20 branches and 525 employees 3-B of the Agreement. in Eastern Canada and Wisconsin, announced its recent acquisition of a controlling interest Goods may be shipped to Ukraine or to in MasonLift. Terms of the transaction were not disclosed. MasonLift has been in business Canada with a trans-shipment, providing the for more than 70 years, has a staff of 130 and operates out of 10 locations in British Columbia, remain under Customs control/in bond at representing Toyota, Kalmar and Load Lifter forklift products, Ottawa terminal tractors and all times (article 3.13). Refunds of excess Atlas material handlers. duties paid after August 1 can be made within four years of the importation date. Day & Ross Transportation Group announced the US acquisition of REI Logistics and What does the current trade between Korten Quality Systems, Ltd in Romeo, Michigan. These two businesses will operate as Canada and Ukraine look like? In 2016, Day & Ross Dedicated Logistics USA, a division of Day & Ross USA Inc under the leadership Canada’s exports to Ukraine amounted to of Shawn McMahon, president Day & Ross Dedicated Logistics. The companies will focus $255 million (up from $205 million in 2015 on dedicated delivery (Auto), dedicated truckload (including temperature controlled), cross- and $137 million in 2014), led by exports of dock and product sequencing including warehousing. mineral products, live animals and animal products, and vehicles, aircraft and associated CEVA won a delivery contract with French-headquartered, multi-national retailer Carrefour. equipment. On the other hand, Canada’s Centered initially on the Paris region, CEVA is responsible for deliveries of soft drinks and imports from Ukraine came to $107 million dried products to almost 60 stores on a daily basis. Operating from its 36,000-square-metre (up from $67 million in 2015 and $99 million facility close to Charles de Gaulle airport, CEVA is also handling reverse logistics for Carrefour including removing packaging and cartons post-delivery. CEVA also recently opened a in 2014)), led by imports of vegetable prod- specialist warehouse for healthcare and beauty products to support Carrefour’s new para- ucts, transport equipment and machinery. pharmacy concept, which will be developed over the coming years. This 7,000-sqm facility, Canada’s bilateral trade has been increasing close to the city of Reims, will initially employ 80 staff, and will be expanded as the new steadily and will likely continue to grow fur- business stream goes live. ther thanks to the CUFTA. MM&D

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By MM&D Staff

s one of the first markets to adopt and Adeploy augmented reality, logistics will continue to be a leading vertical for Augmented Reality (AR) glasses shipments and total value chain revenues over the next five years. According to a recent ABI Research report, “Augmented Reality in Warehousing and Logistics”, logistics will account for 24 percent of global smart glasses shipments in 2017. These shipments are expected to generate ROI to adopters through reduced errors and displays all relevant information like guide- revenue of US$52.9 million in 2017, and will higher efficiency,” says Marina Lu, senior lines, and check lists in the field of view.” grow to US$4.4 billion in 2022. analyst at ABI Research. After completing smart glasses trials in “AR smart glasses’ pick-by-vision capabil- “Another primary enterprise-focused use numerous pilot sites across the US, mainland ity frees workers’ hands of traditional paper case for AR, ‘See What I See’ (remote exper- Europe, the UK, and the Netherlands, DHL lists and picking instructions and enables tise), can drastically reduce travel costs and Supply Chain decided to expand AR solutions them to work comfortably, safely, and effi- optimize resources by resolving issues with across different industry sectors globally, as ciently in warehouses. AR streamlines the AR’s real-time remote support that enables average productivity has universally improved

work process, and in turn offers compelling communication with remote colleagues, and by at least 15 percent. DHL has partnered iStockimages.com mikkelwilliam; Photo:

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8 MM&D | November/December 2017 SUPPLY CHAIN SCAN with hardware companies including Vuzix (M100 and M300 Smart Glasses) and Google, Report offers strategies to along with software provider Ubimax, for their AR logistics solutions. reduce unsaleable goods General Electric has seen significant per- formance improvement in warehousing and By MM&D Staff logistics as well, citing a 46 percent perfor- mance increase using smart glasses on new report provides the consumer goods This report Upskill’s Skylight platform. Asector with proven, tangible solutions to effectively documents “These early use cases, mainly pick and reduce the nearly $15 billion annual cost of the causes of pack and remote expertise, will always be unsaleable goods, or products that cannot be unsaleable goods and prevalent, although new use cases will con- sold due to their condition. provides trading tinue to add potential market value. More The Collaborative Strategies to Reduce ‘‘ universal AR use cases, including mainte- Unsaleables report was released at the Council of partners with clear nance and repair, training, and navigation, Supply Chain Management Professionals instruction for reducing can be incredibly useful in various parts (CSCMP) annual conference. The report ranks them and the impact of the logistic market,” concludes Eric solutions with a track record of success and pro- they have on efficiency, Abbruzzese, principal analyst at ABI. vides implementation guidance. The report was sustainability and “While device concerns around comfort, completed by CHEP for the Trading Partner battery, usability, and robustness do persist, Alliance (TPA), an industry affairs leadership profitability. advancements in smart glasses, as well as the group formed by the Food Marketing Institute quickly growing AR-powered mobile device (FMI) and the Grocery Manufacturers Association (GMA). space, promise to lessen these concerns over “Reducing unsaleable goods is a priority for retailers, manufacturers and their time.” MM&D Continues on page 10

www.mmdonline.com | November/December 2017 9 SUPPLY CHAIN SCAN

REPORT OFFERS STRATEGIES TO REDUCE UNSALEABLE GOODS, continued from page 9 suppliers,” said Daniel Triot, senior director extensive, year-long analysis predicated on frequency of use and impact: at TPA. “This report effectively documents dozens of interviews with industry experts 1. Planning and Review the causes of unsaleable goods and provides conducted by CHEP for the TPA Joint 2. Collaborative Shelf Life Management trading partners with clear instruction for Industry Unsaleables Leadership Team 3. Testing Package and Unit Load reducing them and the impact they have on (JIULT). The study captured and analyzed 48 Performance efficiency, sustainability and profitability.” unsaleable goods reduction strategies and 4. Package Labeling The recommendations are based on an placed them into seven categories based on 5. Receiving and Warehousing 6. Sharing UPC and POS Level Data 7. Product Rotation and Display Recommendations in the report fall into four categories – increase, continue, monitor Gets you moving. or ignore – and each is identified as the responsibility of retailers or manufacturers, Gets your goods moving. or as a collaborative opportunity. A TPA online Unsaleables Reduction edu- cational platform is expected to launch by the end of 2017. The educational platform will contain detailed information and tools to help trading partners review their supply chains and identify and implement effective unsale- ables reduction strategies and solutions. The Trading Partner Alliance (TPA) is a joint industry affairs-industry relations leadership group formed by the Grocery Manufacturers Association (GMA) and the Food Marketing Institute (FMI) to develop and address a shared retailer-manufacturer agenda on supply chain efficiency issues, the application of information technology, /HWWKH:DONLH3DOOHW7UXFNJLYH\RXUSURGXFWLYLW\DOLIW/HW WKH  :DONLH 3DOOHW 7UX ,W¶VSDFNHG executed jointly by GMA and FMI and ZLWKIHDWXUHVWRPRYHJRRGVIDVWHUVDIHUDQGPRUHHIILFLHQWO\ overseen by the boards of directors of both • Maneuvers easily in tight spaces • Stronger, tougher, more durable organizations. MM&D • Smooth, controlled operation • A/C power gets the job done /HDUQPRUHDERXWZKDWWKHFDQGRIRU\RXUEXVLQHVVHD R HDERXW DW W IN CASE YOU MISSED IT Hot BonusXSRQUHFHLSWRI\RXUTXRWHIRUDQ What’s happening at \RXZLOOUHFHLYHDIUHHFRIIHHFDUG www.MMDonline.com UHGHHPDEOHDFURVV&DQDGDIRUDOLPLWHGWLPH st January 31 , 2018 Loblaw closing 22 stores, launching home delivery ZREAD MORE HERE: ForFor a qquote, demo or more info: http://tinyurl.com/loblaw-home ([W LQIR#MRKQVWRQHTXLSPHQWFRP RUYLVLWMRKQVWRQHTXLSPHQWFRP VersaCold opens first part of new Milton, Ontario DC ZLEARN MORE HERE: http://tinyurl.com/versacold-mmd

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10 MM&D | November/December 2017 SUPPLY CHAIN SCAN Adaptation paramount for 3PLs Annual survey highlights technology, relationships

By MM&D Staff Ferry’s North American industrial markets. Organizations must “To leverage the potential upside, organiza- lockchain, automation and new talent now rethink their tions must now rethink their talent strategy Brequirements are the focus of the 2018 talent strategy from top to from top to bottom. The supply chain/logistics 22nd Annual Third-Party Logistics (3PL) bottom. The supply chain/ leader must now be agile, a strategist, a vision- Study. ary and a collaborator. The entire supply chain This year’s study shows the continuation logistics leader must now organization must now compete with technol- of two trends: the importance of the relation- ‘‘be agile, a strategist, a ogy, and the winners will be those that elevate ship between shippers and 3PLs, and the visionary and a collaborator. their people using technology, rather than importance of adapting to emerging technolo- The entire supply chain replacing them with it.” gies, including blockchain and automation. organization must now The result of these closely-forged relationships compete with technology, Risk and resilience in is improved services to the end customer. shipper-3PL relationships and the winners will be Through all the technological Blockchain those that elevate their advances, the opportunity to This is the first time the 3PL people using technology, improve upon the risk versus resilience in study investigates blockchain. rather than replacing them relationships between 3PLs and shippers Results show that while 30 per- with it. continues: 79 percent of 3PLs and 64 percent cent of 3PLs and 16 percent of shippers see of shippers report they have been involved blockchain as a potential application, they in projects in which the ability to execute have yet to engage with the technology. The quickly was directly impacted by lack of com- study describes anticipated benefits including However, the report also revealed a number plete, accurate and consistent information improved supply chain visibility and potential of reasons for lack of investment in digitiza- provided by the shipper. challenges that participants will face in imple- tion and automation, including a lack of in- The study shows a large increase in the menting blockchain. house talent to develop, implement and percentage of shippers seeking information “Blockchain has the potential to make sig- monitor (12 percent of 3PLs and 10 percent technology (IT) services from 3PLs, with 27 nificant improvements in security, transpar- of shippers). percent indicating outsourcing of IT services ency and governance, but only in supply chains Technology improvements in supply chain, in the 2018 study compared to 17 percent in where there is value in controlling consumer especially in the area of fleet operations, have the previous year. risk, valuable goods or complying with regula- had positive impacts on the industry,” said However, the percentage of shippers indi- tions,” said Ken Toombs, global head of Infosys Tom Scollard, Penske Logistics vice-president cating satisfaction dropped slightly this year Consulting. “Shippers and 3PLs will need to of dedicated contract carriage. “It has allowed from 65 percent to 56 percent, potentially work together to drive value from blockchain, 3PLs to operate fleets that are safer and more due to higher expectations among shippers using lessons collectively learned from missteps efficient for the customer.” as technology has improved or because ship- with other emerging technologies like Radio pers are seeking enhanced analytical capabili- Frequency Identification (RFID).” Logistics talent revolution ties to help drive more effective supply chain Technology is reframing the decisions. Automation in demands on the workforce, The 2018 study was produced by Penske transportation particularly within the supply Logistics, the global logistics and supply The study looks at some of the chain where automation, digitization and chain management provider, Infosys exciting potential with on-road data collection capabilities are growing rap- Consulting, the strategy and transformation automation, such as driverless vehicles. It also idly. Supply chain leaders and logistics execu- consulting arm of Infosys, Penn State examines many ways in which automation tives play even more critical roles as companies University, and global talent advisory firm is already providing returns across the supply work to build more efficient and technologi- Korn/Ferry. chain through digitalized load matching and cally advanced supply chains. The study attracted 580 respondents, a 65 warehouse robotics. “It’s no surprise that technology continues percent increase over the number of partici- Competitiveness is a key driver for a major- to unlock unforeseen value across the global pants taking part last year. The study report ity of 3PLs (62 percent) and shippers (57 supply chain in a variety of ways,” said Neil and additional materials can be viewed percent) to invest in automation/ digitization. Collins, regional managing partner for Korn online at www.3PLstudy.com. MM&D www.mmdonline.com | November/December 2017 11 Buying from the “one-trick pony” manufacturer can put you at a disadvantage.

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The Econo-Rack Group (2015) Inc, (Konstant, the regulation of commercial drones in Canada since 2012. He is an Econo-Rack, and Technirack) has promoted Randy expert in unmanned aircraft systems (UAS). As a 33-year veteran of Wronzberg to the position of president and CEO. the Royal Canadian Air Force he accumulated over 4,300 hours in Wronzberg has served as vice-president of operations numerous aircraft and held staff/instructor positions in National Defence for Econo-Rack Group since August 2015. Gabe Headquarters NORAD, United States Space Command, the Canadian Mazzetti, the out-going president and CEO, decided Forces Instrument Check Pilot School, and the US Air Force’s Flight to leave Econo-Rack Group after more than seven Standards Agency. RANDY WRONZBERG years to pursue several personal ambitions. Catherine Dyer has joined Air Canada as chief Ann Pompilio has joined TSI Group as partner. Pompilio brings more information officer. Dyer is based at the airline’s than 25 years of executive experience in finance and supply chain, Montreal headquarters. She comes to Air Canada having spent 11 years as vice-president, finance and CFO for SCI from Enbridge Inc. where she most recently held Group, a subsidiary of Canada Post. While at SCI Group, she brought the role of CIO and prior to that, vice-president, aboard several high-profile customers including Lowe’s and Amazon, Information Technology. She also previously into Canada. Pompilio will be based out of the Toronto office. held a number of senior management positions, including vice-president, distribution at WestJet Heiner Murmann has accepted an invitation to join CATHERINE DYER Airlines Ltd., and director of sales, communications, Metro Supply Chain Group Inc’s advisory board. at Telus Corporation. Murmann has over 20 years’ experience in logistics across the Americas, Europe and Asia. He spent Nanette Efird has joined Savi’s senior manage- the better part of his career at DB Schenker, serving ment team as the new vice-president of product as CEO for the Americas before becoming a member management. A veteran in the world of supply of the board of management, overseeing air and chain logistics solutions, Efird is an expert in apply- ocean freight. In his advisory role, Murmann will ing data analytics and Internet of Things technology HEINER MURMANN work closely with Metro’s management team to help to the global transportation industry. Efird joins steer strategic growth in all markets with an emphasis on the company’s Savi from GE Transportation Digital, where, as expanding international operations. senior director for strategic data and analytics

NANETTE EFIRD solutions, she launched GE Transportation’s ocean Drone Delivery Canada (DDC) has appointed Mark Wuennenberg port solutions business. Before joining GE, Efird served as the direc- to the newly created position of vice-president – regulatory affairs. tor of commercial products and services at Railinc Corp, an IT and Before joining DDC, Wuennenberg worked at Transport Canada as a software services firm for the freight rail industry. Efird graduated civil aviation inspector responsible for general flight standards and with a BS in business.

Networking and mentors seen as means to move up

rocurement workers see networking tionships, to building social media profiles rather than using the full suite of change- Pand mentors are the best means to that have eclipsed the importance of CVs, management tools at their disposal. climb the career ladder, and only half trust to seamlessly leveraging their professional Two-thirds regard their online profile to their bosses to help them advance. networks to find a new role, to crowd- be as important as their CV, and profession- These are a couple of the key findings in sourcing a procurement solution, the al networks are regarded as equally impor- “Procurement’s Gen Next”, a recent sur- members of Gen next are collaborative, tant for career advancement as on-the-job vey by Procurious, an online procurement proactive and ambitious. performance. And, while mentors are the community. Gen Next is described as “a The report revealed that just under half most trusted source of career advice, finding new breed of procurement professionals (40 percent) of those surveyed will change mentors and sponsors is an uphill battle. who are not defined by the year they were jobs within two years, and 70 percent will “In this fast-moving business environ- born, but by their positivity and commit- leave within five years. ment, professionals need to look beyond ment to proactively managing their ca- More than half don’t trust their own their four walls to find best-in-breed prac- reers,” said Hugo Britt, content director at bosses to help with their career progres- tices, mentoring and solutions to complex Procurious and author of the study. sion, and say that 75 percent of managers problems,” said Tania Seary, founding From developing vital mentoring rela- “just send an email” when driving change, chairman of Procurious. MM&D www.mmdonline.com | November/December 2017 13 Walmart’s brand-new Harmony DC in Cornwall, Ontario ensures stores across Eastern Canada have fresh food, with a special focus on the most popular tropical treat

we have yesBy Emily Atkins controlled atmospheric conditions. These banana ripening rooms use state-of- Main: The five banana ripening rooms eep in the heart of Walmart the-art technology to ensure that every case form an imposing backdrop inside Canada’s giant Harmony DC in of the tropical fruit shipped arrives in stores the Perishables DC. Cornwall, Ontario is a large series at precisely the right moment in its lifecycle. Inset: Curtis Brumfield (left) and Drew Dof vault-like chambers. Inside, And that’s no easy task, says Joe Rupolo, Robertson show off some of the green fruit thousands of kilograms of Dole’s ripening and distribution manager that’s headed for a ripening room. bananas are quietly ripening, under tightly for Walmart. Given that the DC ships from

14 MM&D | November/December 2017 bananas Photos by Jason McNamara

Cornwall all the way to Canada’s east coast, under different conditions, they require The Walmart DC has five banana cham- the bananas need to be at varying ripeness close monitoring. bers that can each contain three truckloads, levels as they are loaded for their journey. “You are creating a new product” with or about 54,400 kilos. The fruit is palletized Ensuring the bananas reach stores at the bananas, he adds. As they ripen they turn latex and neatly packed into drive-in racking. optimal moment also means there is less into sugar, creating heat and gases as byprod- They began operation this October, and food waste. ucts. The ripening rooms blow air across the Rupolo has been following the ripened “Not all bananas are the same,” Rupolo fruit and control heat, humidity and ethylene bananas to the stores to verify quality. says. Coming from different countries, gas levels to ensure perfection. CONTINUED ON PAGE 17

www.mmdonline.com | November/December 2017 15 Whether it’s across town or halfway around the world, with every shipment and every project, our customers place their trust in our hands. My hands. Because at some point, every piece of business I touch becomes a personal responsibility. It’s up to me to keep costs down, performance on schedule, and quality at a premium. Someone’s business is riding on it. And I won’t let them down. I am

pilotdelivers.com / 1-800-HI-PILOT

©2017 An employee in the Perishables DC fills up a hydrogen-powered forktruck. The entire material handling fleet uses hydrogen fuel cells.

They’re doing well, he reports. Regional Distribution Centre (RDC) that with and out, reducing energy consumption by “Walmart has the tools in place to be the a minor variance the two properties may be 74 percent. best place to buy bananas in Eastern joined in the future, Robertson says. It is also Canada,” he says. only a couple minutes from the 401 via a brand Operations “It’s one of the most critical items in the new road that allows trucks easy access. The Harmony facility currently sees between store,” adds Drew Robertson, senior director 700 and 900 trailer moves each day, with of operations with Walmart Logistics. “We Getting started approximately 19,000 trucks passing through need to make sure the offering is consistent When Walmart took over the DC from the gates every month. across the region.” Target, it was only two years old. But, it’s no Most of the big Walmart stores get daily surprise that different business would have deliveries, and the DC operates 24/7 to Bigger than bananas different needs, and Walmart needed to ensure they are kept stocked with fresh food. Bananas are by no means the only product renovate. The busiest area is in the frozen, dairy and this DC is handling. Harmony contains three Target only handled general merchandise deli (FDD) area, which receives and ships distinct DC operations under one expansive at the facility, while Walmart handles a wide daily. Inbound trucks are unloaded and roof. The bananas are part of the Perishables variety. A 135,000 square-foot freezer was racks replenished overnight, and outbound DC (PDC), which, along with an Import DC added to the footprint on the east side for loads are built and shipped up until four in (IDC) and High Velocity DC (HVDC), is the PDC. Now the temperature-controlled the afternoon. housed in the former Target Canada build- area includes the banana rooms, a zone for All this depends on the timely arrival and ing. Walmart bought the two-year-old facil- fruits and hearty vegetables that’s kept at departure of trucks, which is controlled ity—along with 12 stores—in 2015 when 12C, a cooler at 1C and a freezer at -23C. through Walmart’s proprietary yard man- Target gave up its Canadian operations. Walmart replaced all the racking in the agement and warehouse management sys- The DC serves Walmart stores from Cornwall building as well, upgrading for weight and tems. But, because of the building’s design, to the east coast, supporting the company’s picking style. Robertson notes that Target dock space is at a premium. push into the fresh grocery market. did quite a lot of single picks, while his opera- “Doors are the commodity here,” Robertson The building is large enough that the CN tion is focused on case and pallet picks. says. “Although we have lots, we could always Tower would fit on its side within the perim- Although the building was only two years have more.” eter walls. It covers about 1.5 million square old, the concrete floor at the main dock The building was designed with doors on feet, and sits on 169 acres. It has more than doors had to be replaced, a renovation that one side only, he notes, which is not the way 200 dock doors, and yard that will accom- took place while the import DC was already a Walmart DC would be designed if being modate 1,300 trailers. operational. built from scratch. It means that the same The facility sits close enough to Walmart’s The building uses LED lighting both inside CONTINUED ON PAGE 19 www.mmdonline.com | November/December 2017 17 GROUPE ROBERT YOUR SUPPLY CHAIN PARTNER

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ROBERT.CA Left: Bananas are joined by other fruits and vegetables as workers prepare outbound pallets in the Perishables DC. Right: A little perspective—the Harmony facility is big enough that the CN Tower could fit, on its side, within the building. doors must be used for inbound and out- Technology maintaining its small-town charm. The bound loads, requiring careful timing. If a The Harmony facility uses one of Walmart’s company hopes to be able to attract some truck is late the whole sequence can be dis- all-hydrogen-powered material handling former Sears Canada employees out of rupted, although it is seldom an issue. fleets. Crown pallet and fork trucks supplied Brockville, Ontario, just 100 kilometres In the HVDC the pace is more restrained. by Ryder rely on hydrogen filling stations down the 401 highway. Five thousand SKUs of fast movers like kitty that are located throughout the facility. Staff can be moved around within litter and diapers are stored in 40-foot-clear Unlike battery powered units, hydrogen- Harmony, as well as to or from the RDC racking or in floor pallet positions. powered material handling equipment runs next door, and if business needs change the In the import DC the freight is all convey- at full power until it needs a fill-up. allocation of space between the HVDC and able and is shipped three days a week to the The system is supplied by PlugPower, IDC can change. In fact, Robertson points regional DC and the Mississauga, Ontario which has been working with Walmart to out that the racking is labeled running in distribution centre. work out some issues that arose with opera- opposite directions in the two spaces so if tions in the freezer area. According to they need to expand they can do so without Human resources Robertson, an upgraded motherboard has having to re-label every rack. All this work is accomplished with a staff of reduced the instances of the units timing And while Walmart is exploring automa- 1,400, including both full- and part-time out in the cold. tion in other areas, Robertson says the associates. General manager Curtis Associates use Vocollect voice recognition Harmony DC is not a likely candidate. Down Brumfield oversees the big picture, with two units for picking. At the moment these are the the road, AGVs could be brought into play, assistant general managers reporting to him. original wired units, although Robertson notes but because the DC is critical to ensuring They, in turn, have 12 operations managers the company is working on an upgrade to the fresh food needs of eastern Canada are and 30 team leads who keep staff up to date Bluetooth headsets with the transmitting unit met, Walmart will continue to count on reli- on each day’s requirements. attached to the mobile equipment. Tests have able human beings for its day-to-day picking With the regional DC so close by, Walmart shown that the Bluetooth units provide better and replenishment operations. is operating the two facilities as a campus. voice recognition and clearer sound, he says. Operating three DCs under one roof has Brumfield says this helps with the flexibility no drawbacks, Robertson notes. Brumfield in staffing, as people can be moved from the Future Harmony agrees: “It’s beneficial to have everything in regional DC over to the Harmony building Expansion is definitely in the cards. “As we one place,” he adds. as demand requires. grow the pain point will definitely be recruit- It’s called Harmony because “we have to As well, many staff from the RDC were ing,” Robertson says, noting that they are work three different facilities in one,” able to move to Harmony when it opened, hiring an additional 100 associates now. He Robertson concludes. “And with the campus providing a core of experienced workers that adds that Cornwall is an attractive location environment we have enough assets to be made starting up smoother. with a burgeoning urban scene, while still make it all work seamlessly.” MM&D www.mmdonline.com | November/December 2017 19 TrendsIN LOGISTICS MANAGEMENT

Some have suggested 2018 will be a challenging year for business. That’s why we decided to share a number of our top trends that will shape the landscape in the coming year and beyond. In the following special section you’ll read about network design, customer service, supply chain visibility, cost control, automation and HR and risk management. A common thread we found this year is the prevalent concern about staffing. Whether it’s figuring out how to automate, or locating your facilities where there are qualified personnel available, finding and managing human resources is top of mind for many supply chain executives.

Network design trends helping companies with their supply chain networks, he says, by providing lots of help Land, staffing and access remain priorities with recruitment. City staff attend job fairs on behalf of companies, for example, and By Treena Hein also post jobs on ChooseCornwall.ca. “We may be only Canadian municipality to istribution centre location and location for a DC that would serve the huge run a job board for area companies,” Peters network design have become Northeastern US megalopolis market – the notes. “Cornwall has also heavily invested in increasingly important issues for richest, most highly-concentrated mass mar- the Cornwall Business Park, and currently Dsenior management, “and never ketplace in the United States – The Boyd offers over 300 acres along Highway 401 for more than in the current environment of Company analysis puts Eastern Ontario immediate development. We have excess uncertainty over trade relations and agree- (communities along the 401 Highway capacity in municipal services such as water, ments,” states a recent report by location between Toronto and Montreal) on top. electrical rates that are as much as 25 percent consulting firm The Boyd Company of below other Ontario communities and a Princeton, New Jersey. Human resources robust fibre-optic communications network. Transportation issues, labour availability, Indeed, Cornwall, in that very region, has We have supported the development of logis- customer service strategy and much more seen significant growth in supply chain activ- tics and supply chain studies at St. Lawrence play roles in designing a distribution network ity. Of all its benefits, Cornwall’s economic College.” that’s going to see a company thrive through development manager Bob Peters believes While both Walmart and Giant Tiger have the next few years, but cost is obviously an human resources is perhaps the most impor- chosen Eastern Ontario for new DCs, Sleep overriding factor. In terms of the least costly tant. Cornwall puts a strong emphasis on Country Canada recently chose Brampton in

20 MM&D | November/December 2017 EXECUTIVE OUTLOOK

southern Ontario. This will help the firm boost of a new terminal in the next few years to York and four other locations, with more to capacity in the Greater Toronto Area to sup- take advantage of the growth in trade with come in 2018. Target also plans to remodel port aggressive growth plans for years to come, Asia-Pacific countries. This terminal would 1,000 of its 1,800-plus stores by 2020, stating which includes new store openings and growth double the port’s shipping container in a press release that they will “serve as in new categories such as lifestyle accessories, capacity. hyperlocal distribution centers to fulfill digital the company said in a statement. In addition to port, rail and highway con- orders faster” as the company creates “a net- venience, “with the extremely limited indus- worked shopping experience, with stores, Proximity trial land inventory remaining in Metro digital channels and supply chain working Leon’s Furniture chose Delta, British Vancouver, Delta is one of the few munici- together…” Target adds that it is “transforming Columbia for its new 430,000-square-foot palities that has industrial-zoned land avail- the way we replenish our stores.” DC for easy acces to import goods. While able for development,” says Delta’s director When asked for specifics on how remod- land prices and the reliability of the builder of corporate services Sean McGill. Delta also elled stores will serve as hyperlocal DCs for were also important, the firm says it choose has incentives in place to encourage industrial faster fulfilment of digital orders, Target Delta because “it’s becoming the largest sea- development, a business-friendly atmosphere communications lead Kristy Welker says it’s port in Canada” and because Leon’s receives and safe residential communities, which about mass customization and being locally a very high volume of product from Asia. McGill describes as “ideal for raising families, relevant. John Boyd, principal at The Boyd Company, which means DCs are able to find quality “In the last few months, we’ve expanded notes that congestion and delays are becom- local employees because people want to live, ship-from-store capabilities from 1,100 to ing increasingly common at major US ports, work and play here.” 1,400 stores in advance of the fourth quarter,” “creating opportunities for Canadian ports she says. “Today, more than 95 percent of to gain market share in the growing North Omnichannel strategy ‘Order Pickup’ orders are ready to be picked American container shipping market”. In DC positioning aside, customer service strategy up within the hour.” Welker did not comment addition to Delta, these port locations include is also a large factor in network design. In the on how Target is “transforming” the way it Saint John, New Brunswick; Prince Rupert, US Target is undergoing a significant network is replenishing its stores, other than to say BC; Halifax, Nova Scotia; and Montreal, change in the name of better service as it shifts that the firm’s small-format stores receive

Quebec. to more small stores. The firm opened 11 small- more frequent product delivery. MM&D iStockphotos.com exdez, Illustrations: Indeed, Delta’s port could see the addition format outlets in October this year in New OUTLOOK SECTION CONTINUES ON PAGE 22 www.mmdonline.com | November/December 2017 21 Why you need it Supply chain visibility For most companies, achieving total supply Seeing beyond the buzz chain visibility will be a stretch target. But there are numerous reasons to try. In our increasingly fast-moving, data-rich, world By Emily Atkins that allows you to control and fine tune your you need to know what’s going on if you are supply chain operations. In theory, visibility to compete. The advantage goes to the com- verybody’s talking about, but who enables better inventory control from end pany that can work around risks inherent really knows what it means? to end, allowing for leaner, more cost-effec- in global supply chains due to natural disas- “Supply chain visibility” – try a tive operations, and ultimately a more robust ters, terrorism and political upheaval. Not E quick online search and you’ll find bottom line. to mention the recently all-too-common a plethora of articles, papers and interviews Gaining visibility is a considerably more disruptions in trade deals that might turn a all talking about how important it is to complex matter. It requires integration of supply chain from viable to wildly achieve. your information systems across depart- unprofitable almost overnight with the Defining it isn’t really that hard, but know- ments (also known as eliminating silos) and imposition of new tariffs and duties. ing what to do with it once you have it is a the ability to gather, process and analyze Likewise, if you are operating in an omni- little tougher. We’re going to take a quick reams of data in real time. You need both channel or simply e-commerce world, you look at both. soft components—a complete systems over- need a degree of nimbleness that can only view of your supply chain—along with the be achieved by applying the discipline of What it is right technology: mobile asset tracking, supply chain visibility. Spikes in demand, First, what is it? Supply chain visibility boils cloud computing, and data processing working with a major buyer or supplier, rapid down to having actionable data in real time power. product obsolescence, or the entrance of a

The customer service challenge Keeping up with retail and rising customer expectations

By Treena Hein Bloomingdale’s, are battling competition The retailer’s more than 1,800 stores across from Amazon to be sure, but they are also the US are about 16 kilometres or less from White hot’ and ‘explosive’ are common battling some new and disruptive e-com- three-quarters of all Americans, which words distribution experts are using merce ideas, notes John Boyd, principal at enables the firm to try and deliver a shopping these days to describe online com- location consultants The Boyd Company in experience that focuses on ease and conve- merce. To establish or grow their foot- Princeton, New Jersey. “Online retailer nience, while also creating capacity to sup- hold in this area, companies are making Gwynnie Bee rents—not sells—clothing port digital growth by leveraging stores to sweeping changes to their supply chain and items to women,” he explains, “enabling fulfill online orders faster. Additionally, customer service strategies. them to use the item for a while or for a Target is working to differentiate its shopping In announcing a new DC in Brampton, special occasion and then return it, thus experience from other companies by Ontario Sleep Country Canada, for example, keeping a new and fresh wardrobe always increased staffing and employee training. described itself recently as having “quickly on hand or on its way.” “We’re elevating every aspect of how we become a player in the growing online mat- serve our guests, including reimagining tress business”. The company has launched Digital strategy hundreds of stores, opening new small- its own mattress-in-a-box product to take on Target is using an extensive multi-pronged format stores, introducing new and exclusive competitors, but the firm also “recognizes approach to try and ramp up its e-commerce brands…transforming the way we replenish that mattresses are tactile and online shoppers sales, continuing “to accelerate enhance- our stores and get products to our guests,” still want to visit retail stores to try their mat- ments in stores and digital to create a net- states Cornell. “As we open more small- tress out before making a purchase.” Samples worked shopping experience, with stores, format stores in new neighborhoods across of online-order mattresses are therefore avail- digital channels and supply chain working the country, we’ll be even closer to our able in all their stories. together to meet guests’ needs.” This, says guests, and our reimagined stores will pro- Other businesses that aren’t so product- chair and CEO Brian Cornell in a recent vide elevated inspiration and ease, along specific, such as major department store press release, is part of “pursuing an aggres- with serving as hyperlocal distribution cen- chains like Holt Renfrew, Hudson’s Bay and sive digital strategy.” ters to fulfill digital orders faster.”

22 MM&D | November/December 2017 EXECUTIVE OUTLOOK

new competitor all require the ability to Fortunately, they don’t have to. With big respond immediately and with full com- data flowing in from integrated systems, mand of the relevant data. and increasingly AI-powered capabilities, supply chain decision-making needn’t take Using the tool hours; once a course of action is determined, By now you may have already gotten the changes can be changes can be executed sense that supply chain visibility is not an within a split second. end state but a skill set, or a tool. That’s If the supply chain’s strategic objectives exactly how some thinkers in the space are are clearly defined, software takes over, mak- characterizing it. Supply chain visibility ing the minute adjustments that are needed enables the immediate decision-making that to turn decision-making into bottom line is required to compete successfully in the success. Heavyweight IT suppliers like SAP scenarios mentioned above. and Oracle are working hard on perfecting It is the logical extension of the old way of and integrating all the moving parts to make doing things with dozens of analysts agglom- this work in the real world. [1] erating, cleaning and churning through the Until they have it nailed, and for the com- numbers coming in from disparate systems panies that don’t have the critical mass to like EDI, ERP, WMS and TMS. There was adopt such sophisticated systems, supply no way these human workers, even aided by chain can still continue to benefit from the numerous IT systems, could possibly keep collection and analysis of their data, and up. They couldn’t do it then, and they cer- work to incrementally improve their own tainly cannot do it now. supply chain visibility. MM&D

OUTLOOK SECTION CONTINUES ON PAGE 24

its ‘Target Restock’ program across the USA. Valerie Young, 3M VP of global supply chain It involves customers placing an ‘essentials’ services and operations. “The benefits from order until 7pm for next-day delivery. The the approach are vast,” Young notes. “By service is already available in 11 major cities. building a customer-driven supply chain, By building a And earlier this year, Target began testing we will have the right portfolio, demand and customer-driven a customer service option called ‘Drive Up’. supply plan which delivers on time and in supply chain, we This allows consumers to order goods full wherever the consumer is, leading to a will have the right portfolio, through the Target mobile app and have long-lasting relationship with a reliable con- these items brought to their cars by a store sumer base.” demand and supply plan staff member. After an initial pilot program She says trust is the key to making a supply which delivers on time and in this summer, in October the retailer began chain flow, and that 3M customers “trust ‘‘full wherever the consumer offering ‘Drive Up’ to throughout the that we are at the cutting edge of innovation is, leading to a long-lasting Minneapolis-St. Paul, Minnesota area. and our quality is exceptional.” relationship with a reliable Target also recently expanded its partner- Young adds that with today’s supply consumer base. ship with Google, rolling out ‘Google chains inextricably linked upstream to sup- Express’ service nationwide. In this scenario, pliers and downstream to customers, fre- – VALERIE YOUNG, 3M VP OF GLOBAL SUPPLY CHAIN Target stores are used to deliver items in just quent communication between all players SERVICES AND OPERATIONS. two days. Target is also adding new voice- is also crucial. activated shopping features, and during this “Consumers rule in today’s competitive, upcoming holiday season, staff members’ complex supply chain,” Young concludes. devices will be equipped to place guests’ “It’s no longer enough to anticipate the needs For example, Target is expanding its same- orders online right from the sales floor, with of our own customers, but [we need] to pre- day delivery service in New York City from the purchase shipped directly to consumers’ dict the needs of our customers’ customers, one location to four additional locations; homes. as well. Striking the right balance between customers have the option to have their in- supply chain efficiency and consumer satis- store purchases delivered within two hours Customer-driven supply chain faction is crucial, and the organizations that anywhere in Manhattan and to parts of 3M is another firm “continuously innovat- do it best see a growing bottom line, higher Brooklyn and Queens, for a small fee. ing” its supply chain, from receipt of cus- customer retention and improved relation- In addition, next year Target will expand tomer orders through to delivery, explains ships across the organization.” MM&D

www.mmdonline.com | November/December 2017 23 EXECUTIVE OUTLOOK Automation and human resources Can automation really replace supply chain jobs?

By Emily Atkins Likewise, an Oxford University study Private sector prevention found that 47 percent of US jobs would be While it’s true that some areas of supply he recent announcement by gro- at risk from automation. In Canada it has chain employment will increasingly be auto- cery chain Metro that it is updat- been estimated that between 1.5 million and mated, those who might be displaced—and ing distribution centres has once 7.5 million jobs could be at risk of automa- their employers—can do something about T again raised the spectre of robots tion in the next 10 to 15 years, according to it. As the Oxford study noted, the more taking supply chain jobs. The company will a report by the University of Toronto’s school skilled the job and the higher the education be introducing automation to its distribution of public policy and governance. At great required to do it, the less likely it is a can- operations, and the changes will result in risk are the 500,000 who drive trucks and didate for automation. This is why compa- the loss of almost 300 jobs. other public conveyances for a living, should nies that are embarking on automation The push for automation is understandable. automated trucks gain quick acceptance. programs are looking to retain and retrain Automation cuts down on costly human With job losses that significant the country the staff who are at risk. They are taking error and variable productivity and it can could face a 12 percent unemployment rate, the initiative to ensure that the people they be worked 24/7 with no need for scheduling, the report notes. have already invested in continue to be benefits, holidays and the other requirements assets to their business. of human workers. From an operations per- A policy response It’s not a new idea that advances in technol- spective, well-planned automation can Such dramatic job loss would be a cause for ogy change the nature of work. Look back reduce costs and improve customer service. great concern, which is why policymakers in history: The first industrial revolution at Every supply chain manager knows that cost are beginning to shape potential responses. the end of the 18th century generated riots reduction is the number-one priority for In the US the President’s Council of as machines began to take over once-manual what is a net cost centre. Economic Advisors has highlighted the jobs. But ultimately, that revolution com- So, every time we hear about another DC necessity of fostering training, education pletely changed our economy and ended up being automated and jobs lost, the question and job-hunting skills. In fact, the US by creating more jobs than it destroyed. of whether humans will have a role at all in Department of Labor predicts that 65 percent Now that we are in what is called the third the near future comes to the fore. After all, of today’s school-age kids will end up doing industrial revolution—a time characterized major companies such as Amazon, UPS and jobs that do not exist now. by increasing digitization of production—we FedEx, among others, already have fully The University of Toronto report offers a have the chance to take a lesson from history automated DCs in operation. As well, arti- series of policy recommendations for the and apply it by preparing now for the inevi- ficial intelligence is making it easier for tasks Canadian government that span the gamut table shift in what we mean by work, both in customer service and procurement, for from revamping our social safety net, to in the supply chain and beyond. MM&D example, to be automated. introducing more protections for workers, to boosting skills training opportunities. Different jobs for humans Many see this as evidence that humans will soon be out of work. The United Nations predicts that the cheap “labour” automation represents will drive a reshoring of produc- tion to the industrialized world, leading to a stall in economic development elsewhere.

Now that we are in what is called the third industrial revolution – a time characterized by increasing digitization of production – we have the chance to take a lesson from history and apply it by preparing now for the inevitable shift in what we mean by work, both in the supply chain and beyond.

24 MM&D | November/December 2017 Cost Control Costs remain a top concern Boyd says his clients are By Treena Hein dollar for much of the past year has built up increasingly outsourcing demand for DC space related to more afford- staffing and HR functions to osts and how to cut them are able Canadian manufactured products. specialized third-party always forefront in supply chain “Warehousing lease rates, especially for agencies specializing in the management. Indeed, survival in modern big box facilities, are on the upswing logistics sector in order to Ctoday’s current business climate in all major Canadian logistics hubs from keep inflationary labour cost requires “the need to be ruthlessly efficient,” current averages of $8.10 to $11.00 in the says one supply chain executive quoted in Vancouver market; $6.80 to $7.10 in the pressures in check, a recent white paper from the ‘Beyond the Calgary market; $7.60 to $8.20 in the especially costs for Horizon’ research project, conducted Edmonton market; $6.55 to $7.20 in metro recruiting, training and by Michigan State University’s Patricia Toronto and $4.65 to $7.95 in Montreal,” he discretionary benefits. Daugherty and David Closs in partnership explains. “Flat shipping rates are helping to with the APICS Supply Chain Council. moderate overall DC costs, but they contrast To be sure, companies are using a wide sharply with hefty increases in other DC oper- variety of cost-cutting measures in their sup- ply and distribution networks, but one major factor is the strategic placement of large, highly efficient DCs. Leon’s Furniture, for example, just opened a state-of-the-art 430,000 square foot DC in Delta, BC that it says will “generate meaningful cost savings and efficiencies over the next several years” as its online and bricks-and-mortar businesses continue to grow. The company names good land prices, as well as the growing port traffic and their building contractor’s reliability as the main factors in deciding on Delta.

Industrial rents Besides a strategic facilities plan (including the consideration of leasing a building versus own- ership), Jesse Micak, principal at LIDD supply chain consultants of Montreal and Toronto, ating costs related to Canadian real estate, Boyd’s view, due to the exchange rate, low lists labour, transportation costs and IT sys- construction and labour, up 6.2, 5.9 and 2.7 land costs, absence of development fees in tems—as well as investments in the necessary percent respectively, from 2016 levels.” many markets and lower benefit costs (owing human to keep them effective—as increasing to Canada’s health-care system). “Accounting areas of cost concern in supply chain Outsourcing staffing firm KPMG ranks Canada first among the roadmaps. Boyd says his clients are increasingly out- G7 nations in terms of tax policies because “Industrial rents for warehousing space sourcing staffing and HR functions to special- of its low corporate taxation rates,” he adds. are also expected to see healthy increases on ized third-party agencies specializing in the “These advantages tend to offset administra- both sides of the border,” states a recent logistics sector in order to keep inflationary tion issues at the border.” report by location consulting firm The Boyd labour cost pressures in check, especially for Circling back to technology, Boyd identifies Company of Princeton, New Jersey, “in the recruiting, training and discretionary ben- “considerable” future savings in the use of range of 6.2 to 8.5 percent nationally and efits. Other operating costs such as taxes and semi-autonomous trucks, where trailing well over 10 percent in hot Northeast and utilities are also critical, given continued price trucks are electronically tethered to a lead Eastern Canadian warehousing markets like pressures from off-shore competitors. human-operated truck, a process known as Toronto, the Boston area and New York and “Improving the bottom line on the cost side platooning. Ford Motor Co. is establishing New Jersey.” of the ledger is the only choice for many DC a major autonomous R&D centre in Ottawa Principal of the firm, John Boyd, adds that operators,” Boyd notes. and General Motors of Canada will be open- the fact that the Canadian dollar has remained However, Canada is well positioned in ing a similar research facility in Markham, in the 70 to 80 cent range against the US North America for DC cost effectiveness in Ontario. MM&D www.mmdonline.com | November/December 2017 25 PUBLICITY STUNT OR GAME CHANGER IN INSTANT FULFILMENT?

By Khasha Ghaffarzadeh

he idea of drone delivery sharply divides Tcommentator opinion: some dismiss it as a mere publicity stunt while others con- sider it a game changer that will bring near instant product fulfilment to e-commerce, stripping traditional shops of their last major differentiator. Here we paint a big picture of how we see the emergence of drone delivery. Drone delivery entered mainstream media in late 2013. Around that time, drone delivery of e-commerce parcels was first demon- strated while, in parallel, drones successfully delivered medicine to remote areas. Since then numerous deliveries have been made, partnerships announced, and substantial sums invested (see as example Matternet and Zipline raising a total of $12.95m and $41m, respectively). Despite these developments however, the industry is still in its infancy. The new prevalent strategy is to pivot towards commercial drones. The drones will time needed for re-charging/re-loading. Drone delivery faces be higher performance and potentially appli- The limited productivity, however, is not critical challenges. cation-customized, leading to higher prices. a showstopper. This is because fleet operation Individual drones offer This will hold true in the medium-term but will compensate for poor individual drone there will be no escaping the ultimate fate: productivity. limited productivity; they hardware platform commoditization. The The unit cost of drones will be substantially can only carry smal rise of ‘prosumer’ drones—with prices lower than, say, a van, enabling the conversa- ‘‘payloads, and battery already down close to the consumer end— tion of a few, highly-productive vehicles into technology limits their attests to this many small drones with high productivity at the fleet level. This will require a further flight duration and requires Fleets to boost drone productivity? major reduction in hardware costs for com- more time for recharging. Drone delivery faces critical challenges. mercial drones, but if the past is to be our Individual drones offer limited productivity guide, this will be inevitable. compared to traditional means of delivery As a general point, autonomous mobile (consider a van delivering 150 parcels in an robotic technology is causing a paradigm eight-hour shift). They can only carry small shift in the way we envisage many commer- to amplify the productivity of the driver. payloads, and battery technology limits their cial vehicles. Autonomous mobility can upend this by con- flight duration, constraining them to about Take an unrelated example: tractors in agri- verting a few, fast, heavy tractors into a fleet a 30-minute radius of their base while further culture. Here, the traditional design objective of many slow, small, driverless agrobots. This

Photo: vchal; iStockimages.com vchal; Photo: lowering their productivity due to the down- has been to make the tractor bigger and faster process has begun and drone delivery can be

26 MM&D | November/December 2017 with low, sprawled-out population densities. High-density urban environments will remain largely out-of-reach. Our forecast model and technology road- maps show that delivery drone sales will remain limited to a few hundred of units sales per year between now and 2027/28. Demand will then start to take off, reaching sales volumes exceeding fifty thousand units per year by 2038. Thanks to accumulation effects, we therefore expect to see major drone delivery fleets in operation within our twenty-year forecast period.

Conclusions Drone delivery is still in its infancy. Its short- term potential, we find, has been exaggerated. However, the technology has a long-term future, particularly within the context of the bigger trend to automate as much as of the logistics chain as possible. Its realization will require patient investment in R&D and trials, constant negotiation with regulators, and viewed as part of this same long-term trend. Will safety concerns stop the show? wholesale re-organization of distribution Limited payload is also not a showstopper The most critical challenge is safety. This can points and practises. because, according to Amazon statistics, indeed be a showstopper and will almost cer- This technology will be a loss-maker for its some 85 percent of packages weigh less than tainly limit the market scope to sparsely popu- main users for years. The ultimate grand prize two-and-a-quarter kilograms. Furthermore, lated areas. Regulatory frameworks are already of instant fulfilment will, however, drive this the decline in delivery costs and time for being relaxed for commercial drones, but still industry forward. Players will have no choice customers is changing purchasing habits: rightly continue to put brakes on large-scale but to continue to sink money into distribu- frequent orders of small items are replacing deployment of beyond-line-of-sight commer- tion technology/services, viewing them as that big, infrequent order. This matches well cial drones. Indeed, there are many accidents marketing expenses in their battle for market to the strong points of drones. waiting to happen: mechanical failure causing share against each other as well as against Limited range is also not a showstopper crash, software failure leading to early release traditional stores. Despite their ultimate rise even in suburban areas where customers do of payloads, and so on. however, drone delivery will remain only a not live close to a distribution point. It will, Safety concerns will be a major damping small part of the much bigger commercial however, mandate a gradual yet wholesale factor. Together with technology limitations drone story. MM&D change in the location of warehouses, with they will limit the market scope. Indeed, our more placed closer to end customers, or the market roadmap suggests that drones will Khasha Ghaffarza is research use of large mobile drone carrier vans. The initially be constrained only to deliveries to director at IDTechEx. More former is already happening in the back- remote areas. Technology evolution will information can be found in: ground, while the latter has also been dem- enable them to next diffuse towards deliveries “Mobile Robots and Drones in onstrated at the proof-of-concept level. of urgent vital items, and then towards places Material Handling and Logistics 2017-2037”. www.mmdonline.com | November/December 2017 27 Warehouse Execution Systems Product traceability to handle regulations and recalls

By Dave Williams

n October this year alone, the Canadian manufacturers to respond to problems response can occur the greater the chance Igovernment warned consumers of 46 within the manufacturing process more that contaminated or malfunctioning prod- recalled items ranging from Halloween cos- quickly, as well as ensuring that they are ucts do not leave the facility. tumes to car parts and fresh, frozen and meeting regulation standards. If not caught before the products leave the canned foods. facility, utilizing a WES that is tightly inte- Recalls and regulation requirements touch The WES and recalls grated with other supply chain systems allows every industry. Just one recall can cost a By providing a high-degree of product trace- manufacturers to more quickly and easily company an average of US$10 million, not ability, an integrated WES can help manu- identify products to be recalled by showing: including lost sales, profits and a tarnished facturers more quickly discover and act upon • What vehicle(s) the products are on; brand reputation, according to a study by issues that have caused the recall. Earlier • Where the products are located on the the Food Marketing Institute and Grocery detection often allows manufacturers to bet- vehicle; Manufacturers Association. ter understand what product is to be recalled, • What specific stops occurred during In addition to recalls, manufacturers in thus potentially reducing the scope of the transit; many industries are facing increased regula- recall effort by targeting only affected • What other product(s) might have mixed tions. These regulations have manufacturers inventory. with the contaminated products. searching for cost-effective solutions for For example, suppose a manufacturer ran Companies can then use this information increasing product traceability from the pro- a lot of a single product on a production line to provide their customers with the informa- duction line through delivery. at midnight and then determined that there tion needed to identify and return the recalled This is where manufacturers see the ben- was a problem with those products. The product quickly and efficiently, saving both efits of a warehouse execution system (WES). manufacturing system can communicate to the company and its customers time and Connecting a WES to both upstream and the WES and locate all of the products that money. downstream systems in the supply chain were produced from that particular line dur- A well-managed process is crucial when

Photo: relif; iStockimages.com relif; Photo: increases product traceability, allowing ing the specified timeframe. The quicker this processing recalled product accurately and

28 MM&D | November/December 2017 efficiently. There are many different recall manufacturers must be able to trace: cation can orchestrate the process across the scenarios that a manufacturer must be pre- • What time the product went into/out of entire supply chain. pared to handle. specific controlled environments; Contaminated or malfunctioning products What to do with the returned products? • What time and for how many minutes it and regulatory non-compliance can poten- Should the products be discarded? Is special was out of that environment; tially be hazardous to end customers. handling required? Do the products need to • What time it was loaded onto the vehicle Certainly, they can be extremely detrimental be quarantined for further inspection? Are for delivery; to a company’s financial health as well. By there specific reporting requirements? Many • How many minutes it was on the vehicle integrating a tightly integrated WES into the of these processes are easily automated within and at what temperature; supply chain process, manufacturers are able a WES and will guide individuals through • What time product reached its destination; to implement traceability and control require- the process, ensuring a complete, well-orga- • How long product sat in a particular ments throughout the supply chain and are nized, well-documented event and efficient location; able to quickly identify, track and efficiently handling of the affected product. • What time the product was put back into recall contaminated or malfunctioning prod- a controlled environment at delivery ucts when necessary – saving time, money The WES and regulatory compliance location. and often their reputation. MM&D Increased regulations are requiring that many With complex traceability requirements manufacturers are able to trace their products such as these, manufacturers with a separate Dave Williams is the director from production through to delivery at the WMS and a separate warehouse control sys- of software and solution retailer. tem (WCS) often run into traceability issues. delivery for Westfalia For example, increased traceability regula- However, with a WES, manufacturers can Technologies Inc., a provider tions in the pharmaceutical industry now implement traceability and control require- of logistics solutions for plants, require manufacturers to record every move- ments within a single solution and because warehouses and distribution ment of each pharmaceutical produced. Now the WES connects to other systems, the appli- centres since 1992.

Coming in the February issue of MM&D… 2018 Survey of the Supply Chain Professional Salary • Education • Experience • Scope of Operations

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www.mmdonline.com | November/December 2017 29 Material handling Installation and inventory control installations inventory from around the world

Compiled by Emily Atkins Robotics trial simplifies materials handling he Finland-based marine and energy Ttechnology group Wärtsilä and its logis- tics partner DHL have completed a successful pilot using Fetch Robotics’s mobile robots. The pilot was carried out in Wärtsilä’s central distribution centre in Kampen, the Netherlands, where the entire logistics chain of spare parts, from order intake to customer delivery, is managed. DHL runs the ware- house operations. The aim of the project was to investigate the application of technology innovations in the daily operations of the warehouse. Wärtsilä and DHL also wanted to gain more understanding of the added value of robotics in a warehouse environment and to learn about the human–technology interface Above: The Fetch Robotics unit can sense moving and static objects in its path and work around between robots and employees. them. Below: The trial took place at Wärtsilä’s DC in Kampen, the Netherlands.

Point-to-point materials handling mum battery life of nine The mobile robot system simplifies point- hours comes to an end, the to-point material handling. Workflows at freight robot independently Wärtsilä’s warehouse can be set up and makes its way to the charg- modified very quickly to accommodate ing unit. The intelligent dynamic environments, without the need robots recognize their loca- for complex programming. Workers can tion and surroundings, and interact with the robots via touchscreen and can differentiate between send them on their journeys with a push of dynamic and static obsta- a button. cles, thus enabling evasive “Our [human] colleagues took centre stage action to work safely with during the trial. The robots are designed to and around people. work alongside employees and to relieve them “Our relationship with from physically strenuous tasks,” said Denis DHL is a great accomplishment,” said Träskbäck, general manager, parts delivery Niezgoda, robotics accelerator lead at DHL Melonee Wise, CEO at Fetch Robotics. “We at Wärtsilä Services. “Over the coming customer solutions and innovation. “The were able to deploy our robots in the facility months, we will continue to trial different robots alone took over a walking distance of in a matter of days, rapidly improve on-site robot types and technologies together with more than 30 kilometres per day, thereby productivity, while increasing the safety of our partners to further improve productiv- increasing productivity and safety within the warehouse employees.” ity, quality and safety in our operations. We the warehouse working environment.” “The pilot was a success and, as a result, have exciting times ahead. Working with The autonomous mobile robots have a we have decided to continue exploring and robots means embracing a new change, and load capacity of 78 kilograms and can travel developing new applications of smart co-operating in new, productive ways in the at two metres per second. When the maxi- mobile robot technology,” said Anne future.” MM&D

30 MM&D | November/December 2017 Shining a light on rack selection

ven before Clay Electric Cooperative sought Eto build a new warehouse to consolidate main- tenance materials from various storage facilities into one location, the North Florida member- owned cooperative was determined to dramatically improve logistics, reliability and productivity. However, achieving this required resolving the most pressing issues encountered at its existing facilities, and engineering a solution that would lower costs and reduce downtime in the future. The co-op, which serves approximately 170,000 accounts and services an area that stretches into 14 counties, had ongoing issues with forklifts run- ning into and damaging the racking. Bidding for the job had to be open but would come down to more than the lowest bid. In choos- ing value over price alone, the co-op was looking Clay Electric chose a cost-effective for the best long-term solution. racking system that is designed to Because the new warehouse would not require withstand increased impact. high-volume traffic, like a distribution centre, for example, employees would not be dedicated, full-time forklift opera- Guardrails tors. In the past this had increased the instances of forklift impact To make its storage racking system even more impact resistant, related rack damage, so the racking had to be capable of withstand- Clay Electric also implemented an innovative, adjustable, boltless ing unavoidable accidents with minimal maintenance. rack column protector called Snap-Guard, which safeguards the upright rack column from forklift damage. Constructed of structural Increased rack resistance angle, with a unique four-rivet connection that automatically locks In such cases, increasing rack resistance to impact can improve into the upright column, it can be adjusted and removed as needed safety and operations while reducing the total cost of ownership to protect the desired storage level. including repair and premature replacement. There are several ways “Instead of a typical bolt-on design, the snap on protector snaps to achieve this, which involve choosing the appropriate racking into the rack’s tear-drop holes, which makes it very easy to install materials and options. and adjust,” says Chadwell. “Typical rack that uses three-sided upright columns with an open Since a rack upright’s first six to 12 inches of column from the back, called open back roll form rack, is more susceptible to potential floor is also prone to fork truck impact, particularly at end rows accidents by operators lifting a load too high and backing out,” says and intersections where maneuvering is tight, Kardex Storage also Buddy Chadwell, president of Kardex Storage, a material handling installed Guard Dawg guardrail rack protection. distributor in Florida. “This can place twisting, torsional loads on The guardrail, constructed of high-strength steel angle, protects the rack that can shorten its lifespan and even lead to it tipping upright columns and comes in right, left or double ended guards over. It is seldom the best choice when the structure must endure so it is fully compatible with most end row racks. frequent or long term forklift impact.” As for the end result, Chadwell says, “The closed tubular selective A better choice is to opt for a cost-effective racking system that is rack, with its accompanying guardrail and column protection, is designed to withstand the increased impact, and then supplement designed to last decades longer than typical open back rack, with the most impact prone areas with additional protection. For the less maintenance and more uptime.” project, the co-op decision makers chose SK2000 pallet rack, a For its part, the co-op is already experiencing the benefits of the boltless, closed tubular upright product by Steel King. extra engineering that went into its new warehouse, along with its Compared to open-back, roll-formed columns, the closed tubular selective rack. uprights are 44 times more torsion/twist resistant, with 250 percent With more than 13,000 miles of distribution and transmission greater frontal-impact resistance and 68 percent greater side-impact lines, the co-op has received a superior Average Service Availability resistance. All beams are constructed of high-strength (55,000 p.s.i. Index of 99.95 percent, a measure of reliability commonly used by minimum) steel, and holes are placed on the column’s face, not the electric utilities. By making these types of key, targeted improve- corners, minimizing loss of strength. ments to increase uptime, productivity and safety, Clay Electric “The tubular rack is much more resistant to rack movement and Cooperative expects to further build on its stellar reputation and twisting than open back channel designs,” says Chadwell. “This overall index rating. MM&D translates into a much longer usable lifespan and more operational uptime with minimal maintenance.” INSTALLATION INVENTORY CONTINUES ON PAGE 33 www.mmdonline.com | November/December 2017 31 Manufacturing Management online certificate of completion

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AGVs streamline medical equipment manufacturing

t GE Healthcare’s 280,000-square-foot ARepair Operations Center in Milwaukee, Wisconsin, a fleet of OTTO self-driving vehicles is used to deliver parts to workstation cells to handle over 2,000 repairs of medical devices weekly. OTTO is a self-driving vehicle designed exclusively for material transport in indus- trial environments. The vehicles combine the reliability of an AGV, efficiency of a conveyor and flexibility of human decision- making by using advanced sensors and arti- ficial intelligence. The OTTO offers flexible automation and does not require fixed infrastructure (no beacons, magnetic tape or pre-defined laser paths). Each vehicle can operate 24/7 by using opportunity charging technology to autonomously visit its charger for frequent, rapid charges between missions. The vehicles from OTTO Motors (a divi- sion of Clearpath Robotics Inc.) contribute GE has been able to reduce the footprint of its repair stations thanks to the integration of OTTO. to GE Healthcare’s lean manufacturing strat- egy and support its mission of providing repair cell stations at the Repair Operations cians to manually push carts to move equip- hospitals and medical centres with reliable, Center by 40 percent, much of which is due ment into repair cells and shipping areas. fast repairs. to the integration of the OTTO self-driving Material transport was typically dependent vehicles. on other manual tasks, which often led to A mandate for lean Parts are delivered on-demand and navigate delays. Furthermore, facilities suffered from GE Healthcare provides medical technolo- from the pick-up point directly to the destina- wasted floor space due to room needed for gies and services. When repairs are required tion, always taking the fastest route. OTTO carts and fixed infrastructure. on medical devices, it is imperative that the is also able to take on multiple jobs within quality repairs are completed quickly and the plant; the same vehicle can be used in Better care efficiently, and the devices are returned to different applications across the facility, from “It’s GE Healthcare’s priority to enable the the medical facility to be put back into service supplying parts to repair cells and moving best patient care possible and it needs tech- for patients that rely on them. finished goods to shipping zones. This multi- nology partners that contribute to its mis- “We needed to find an on-demand solution functional capability has led to a 66 percent sion. OTTO plays a critical role in the for moving materials throughout the facility. increase in productive floor space. Milwaukee repair centre by ensuring that OTTO is a perfect solution because it gets “OTTO makes our jobs easier,” says Joe materials are in the right place, at the right materials where they need to be, when they Germait, manufacturing technician at GE time, every time,” said Simon Drexler, direc- need to be there,” says Patricio Espinosa, Healthcare. “Space is a shortage in our work tor of products at OTTO Motors. director, Americas repair operations at GE areas, so it’s helpful that we can call OTTO The vehicle comes in two styles: the Healthcare. on demand and have it come pick up our OTTO 1500 and OTTO 100. Both can “The system can make a decision to turn parts. The pick-up times are really quick, drive over seven kilometres per hour and and take different routes, which was essential and it allows us to switch to the next part they can be outfitted with different for us. Our process changes every day more quickly. Occasionally we meet up with attachments to fit the needs of the facility depending on what parts come in for repair, OTTO in the aisle ways and it goes right and the payload. The OTTO platform but OTTO can accommodate all of them.” around us.” provides obstacle detection and avoidance, and dynamically moves through facilities in Optimizing floor space From manual to flexible automation the most efficient manner to reach the GE Healthcare has reduced the size of its Previous GE repair centres required techni- destination point. MM&D www.mmdonline.com | November/December 2017 33 When it comes to air freight, our expertise delivers. Air Canada Cargo has shipped freight expertly for 80 years, earning the trust of our partners worldwide. With a growing network serving over 450 cities, specialized shipping solutions, and sales representation in over 50 countries, we offer countless possibilities for shipping freight quickly around the globe. Experience today’s Air Canada Cargo. LEARNING CURVE

Technology: Are our heads in the cloud?

here is no longer a distinct division between work help discipline our tech usage can prevent delays, allow Ttime and personal time. one to get out of the office sooner and improve job Be it hyper-connectivity; driverless vehicles; smart completion success. cities; artificial intelligence; manufacturing automation; Another great tool for managing time and organizing Tracy Clayson robotic warehouses; drone deliveries; Siri, the intelligent work assignments and reducing meeting times is personal assistant; animation; virtual reality; or holo- BaseCamp, an app that allows multiple parties par- grams, the only limit to technology is our imagination. ticipate in projects. It is reported to reduce fall-off of Business today is entirely digitally driven, and over 75 ownership, creates cut-off times for end-of-project percent of Canadians have a smart phone that they deadlines and offers to-do lists, automatic reminders claim to enjoy because of the ability to communicate and connects entire teams to deadlines. with others, time savings, increased resources for infor- mation and the offer of a range of creative outlets. Knowledge workers need to adapt to evolving Of the 19,000 Canadian workers sampled in Statistics technology regardless of age demographic. Canada’s General Social Survey, 68 percent reported Marketability is all about an attitude of job satisfaction in 2016. That is down 10 percent from the last survey ten years ago. This correlates to the willingness to embrace the increased use of Internet technologies and smart tech tools and continue to build phones during the same time period. While the iPhone skills necessary to advance and other devices offer entertaining social apps, the one’s career. downside is that smartphone for business is the new norm. From checking work emails at home to respond- GoToMeeting, web portals and video conferencing ing and engaging in work duties full on all the time, for client relationship management, multi-branch smartphone use increasingly interferes with home life. meetings, and business presentations have really The majority of working adults today are managing boosted information exchange for local and global to balance the demands of career, family responsibili- businesses. ties, home and vehicle care, while also fitting in leisure In the recruiting space, video interviews using time. The good news from the Statistics Canada report Facetime, Skype and HR specific platforms such as is Canadians between ages 15-64 say life is better due Spark Hire have replaced in-person interviews, freeing to technology use. Think about remote work: flex work, up schedules and providing access to offsite locations. travel activity and how much getting to the job takes Business development tools have been at the forefront away from being on the job. Setting up WiFi/remote of usage, with customer relationship management work cuts away the travel delays, reduces costs, saves tools (CRMs) in existence for several decades. Now, time, office resources, scheduling and planning and a with so many more ways to push sales and branding, raft of other traditional employee management leaders in the field are eight times more likely to be requirements. heavy tech adopters. If you do have to get to your office or onsite meetings, On the upside, the digitized workplace is eliminating using the Waze app is a great tool that boosts GPS mundane tasks and preventing data errors, completing with real-time user data, especially critical in congested document storing, scanning, sorting and data capture areas in major urban centres in Canada. As someone from a number of sources in an automated way with who spends the majority of work time in the car, tech business processing management tools like Yakidoo. features were a critical factor in car choice. Knowledge workers need to adapt to evolving tech- No matter where or how you work emails, search nology regardless of age demographic. Marketability Tracy Clayson is activities, social media participation and other non- is all about an attitude of willingness to embrace the managing partner, productive, distracting and interferences are some of tech tools and continue to build skills necessary to business development the negative factors that affect prioritizing goals. Now advance one’s career. For those of us who are glued to of Mississauga, technology use can be measured and can be blocked screens and systems it might be wise to consider a tech Ontario-based off with certain apps. Rescue Time, for example, tracks diet or fast for the benefit of health, happiness and a In Transit Personnel. time spent on certain applications. Having tools to boost of melatonin. MM&D [email protected] www.mmdonline.com | November/December 2017 35 THE PLATFORM FOR YOU TO Featuring Speakers:

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ACT NOW AND SECURE Jim Hourigan EARLY BIRD RATES Chief Supply Chain Officer, BuildDirect Technologies

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www.cargologisticscanada.com LEADING EDGE Back in the saddle

ifty years ago, when I was six, I had the opportunity in our career and business pursuits too. Testing the Fto ride a pony at a church picnic in Winnipeg. boundaries of our assumptions can lead to break- Within just a few minutes my eyes swelled shut, my throughs and new opportunities. A couple of clear-cut nose ran continuously and I sneezed over and over examples came to mind. again. I guess you only discover you’re allergic to horses Recently a business acquaintance of mine launched Ross Reimer when you sit on one, and from that day forward I’ve a new business that required a significant number of avoided riding. Now, this hasn’t been easy since both speaking engagements. As we all know, this can be my wife and daughter are expert riders and I’ve attended very intimidating, and my friend had had a couple of many horse shows – always with a breathing mask, bad experiences years earlier and consequently avoided allergy medicine and careful positioning so as not to public speaking ever since. get too close. But because he was deter- To be honest, not only am I allergic to horses, but I mined to achieve his goal he also find them a bit intimidating given how many enrolled in a course with an times I’ve seen them spook and throw their rider. I’ve expert public speaking teacher, helped both my wife and daughter out of the dirt and practiced diligently and has back on the horse multiple times. Thankfully there now done numerous effective were only minor injuries along the way. Over the years, presentations that are contrib- I always felt kind of okay that riding was “out” for me. uting to his business growth. So when my wife and I planned a trip to the Great Another friend of mine has Smoky Mountains in Tennessee just a few weeks ago spent all of her career running I certainly didn’t have riding a horse on my personal a successful interior design agenda. In fact, I stowed my golf clubs in the trunk business. Recently she got the and planned at least a couple of games. bug to start something new and When we arrived at the resort it was clear that horseback launched a sister company in riding on their many trails – over 4,200 stunning acres – the rental collection and ser- was very popular. Our first morning, as I sat outside vices business, targeted at wed- sipping my coffee and watching the fog burn off to a dings and other special events. It became very beautiful sunrise, I noticed the horses in the paddock. It required her to become an clear that it’s The wheels began to turn. Why not? It would be an expert in purchasing, inventory worthwhile to try experience, it would make my traveling partner incred- management, logistics and new things...” ibly happy, and who knows? Maybe I’ll only sneeze a perhaps most importantly, few times! marketing via social media to an entirely differentferent As I floated the idea, my wife smiled from ear to ear clientele. and we headed for the barn. I was given the steadiest Finally, another friend who had not been in university horse, named Bill, from the folks at the barn, and most for nearly 30 years, and whose academic record was importantly some expert instruction from my knowl- middling at best, decided it was time for an MBA, a edgeable wife. This was a bit more than a trail ride. plan that was not only costly but educationally chal- We were heading through a fast-moving creek (twice), lenging to him personally. He quickly became cogni- up a couple of steep slopes and then back down a zant of the time commitment, the many years since Ross Reimer has narrow trail through the bush. Wow, that wasn’t in he’d been focused on an academic pursuit and, quite over 30 years of the brochure! frankly, the doubt in himself. Along the way, it was experience in Long story short? It was loads of fun, I experienced great to check in with him. And today he is celebrating transportation/ no allergic reaction (apparently you can grow out of the successful completion of his degree. supply chain. For the allergies), I arrived back at the barn still in the saddle From a relatively simple act like getting on a horse, last 20 years he has (facing the right direction), and most importantly to a venture as complicated as starting a new business, been President of shared a really fun time with my best friend. focused energy, combined with some expert advice Reimer Associates, As I reflected on the experience while we continued can produce outstanding results. Yes, in this situation a recruitment firm our vacation it became very clear that it’s worthwhile we’re forced to face our fears, but the reward in the within supply chain. to try new things, not only in our personal lives but end makes it all worthwhile. MM&D [email protected] www.mmdonline.com | November/December 2017 37 SAFETY FIRST Keeping product safely on the racks

hile having your steel storage racks ward, a requirement in many fire Wcollapse into an intertwined mess of codes today. You now also have a twisted steel, damaged product and potential risk of the pallet being placed in Norm Kramer employee injuries may be a rare occurrence, the racking structure behind this having product fall due to poor storage prac- pallet making contact, causing the tices is unfortunately not. Misplaced and entire load to fall. poorly stored product is a common recurring The opposite can also occur, hazard tied directly to poor storage practices. with the pallet placed so that it is barely touching the back beam, resulting in excessive pallet overhang in Developing improved storage practices the front of the beam. What’s the problem with this The two main risks that warehouse businesses face storage practice? Now you now have a situation where are their racking structure collapsing and product a pallet load being raised by lift truck forks can poten- falling. There are a number of control methods to tially make contact with the overhanging pallet and prevent racking collapse. They include: Row-end may result in dislodging the entire pallet load. guards; bull-nose guards; post guards; double posting; Just one more scenario where product may fall wrap-around guards; guardrails; bollards; and heavy- arises when there is minimal space between the top duty base plates and anchors. of the pallet load and beam above. What can happen? All of these various controls are designed to be an The lift truck lifts the load upwards, it strikes the beam, integral part of the racking structure. We have seen damages the product and now the load on the beam companies spend thousands of dollars on brand new above has a greater risk of falling. racking structures, only to see them battered and dented within a short period of time. What can help? Why does this happen? Because there was a lacking A critical support for any business to reduce the risk of planning. Controls to consider might include ensur- of racking collapse and product falls is the new CSA ing appropriate guarding at the ends of rows where 344-17, User Guide to Steel Storage Racks. This new there is a steady flow of vehicle traffic turning sharp guide recently replaced the CSA Standard A344.1-05/ corners. If an appropriate guard is installed that pro- A344.2-05 - User Guide for Steel Storage Racks/Standard vides a separation itself and the racking, the guard will for the Design and Construction of Steel Storage Racks. be what gets struck and the racking structure will All of the situations described above that can cause remain fully intact. loads to fall are nicely illustrated in the CSA User Guide. The more common hazard of falling product can One of the first things you will notice when you open also often be mitigated with a variety of design controls it compared to the prior version is the many illustra- including: Pallet safety bars; vertical netting to protect tions in the new version. Most of us like to learn by walkways; back-stop beams; back-stop vertical mem- both looking at pictures and reading supporting text bers; overhead protection tunnels; and taller frame at and the new CSA guide incorporates these illustrations row ends. throughout the publication, providing clear and insight- Norm Kramer is a Other factors that can contribute to the risk of prod- ful information on design controls to protect racking, Canadian Registered uct falling are how loads are placed and positioned on proper load placements and unsafe load conditions. Safety Professional the pallet. For example, loads that are leaning to one These illustrations make it easy for your inspectors to with over 25 years’ side, protruding past the pallet edge or bulging from know what to look for when performing their monthly experience. Norm the centre of the pallet, all increase your risk. inspections. The new CSA user guide packs a powerful provides expert, Another common practice increasing the risk of punch of technical information in relatively few pages in-depth health & product falling is the way the load is placed and posi- due to the rich graphics that it contains. safety consulting tioned on the racking structure. Have you ever noticed The new CSA User Guide makes it easy to under- services for WSPS as at your workplace that pallet loads are placed too far stand the options available to protect your racking. a Warehouse Specialist back on the beam structure? In addition to increasing It provides an essential first-step in ensuring your in the GTA region. the risk of product falling, you are blocking your flue racking is safe, well maintained, properly used and [email protected] space, which may inhibit water from flowing down- inspected. MM&D

38 MM&D | November/December 2017

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