D I S T R I B U T I O N B U S I N E S S J O U R N a L M a N a G E M E
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Di s t r i b u t i o n Bu s i n e s s Ma n a g e m e n t Jo u r n a l Volume 2, 2004 Price: $5.00 Lean, Smart, Supply Ch a i n s RF I D : The Next Generation of Bu s i n e s s Beyond Fill Rate: Perfecting the Perfect Order DBM 2004 Directory and Reference Guide DC Expo 2004 Ov e r v i e w Kraft Foods: Sustainable Logistics Leads to Long-Term Pr o f i t a b i l i t y Lean Thinking in Distribution Ma n a g e m e n t The Learning Path to RFID at Ph a r m a v i t e 0 Circle Number 66 Circle Number 67 DB M J Di s t r i b u t i o n Bu s i n e s s Ma n a g e m e n t Jo u r n a l 4 St a f f 21 The Learning Path to RFID at Pharmavite 4 Introduction: Special Focus on Lean, Smart, This special feature Supply Chains profiles an individual who has received special 5 Ed i t o r i a l recognition and status 7 Publisher‘s Letter through on going, educational efforts 9 Industry Rou n d u p and professional ac h i e v e m e n t s . 10 Using Lean Thinking in Distribution 27 DBM 2004 Exhibitor Ma n a g e m e n t Directory and Applying lean concepts Reference Guide to distribution systems and networks is a 45 Advertisers Index logical and powerful 46 DC Expo 2004 exercise that can Exhibitor Listing result in measurable im p r o v e m e n t s . 52 Kraft Foods: Sustainable 14 RF I D : The Next Logistics Leads to Generation of Business Lo n g -Term Businesses change as Pr o f i t a b i l i t y new strategies are Kraft recognizes that devised, different over the long term, some business practices sustainable practices can are put to use, and new increase product quality technologies deployed. and actually reduce cost. The way business is conducted is changing. 56 Spotlight on 17 Beyond FIll Rate: Education and Perfecting the Perfect Res e a r c h Or d e r Logistics education at Distribution centers Ohio State University is have worked hard to highlighted in this get their fill rates up - is s u e . often into the high 90th percentile – only 60 Customer Service: to find that customers The Key to a are still not happy. Successful Supply What companies are Chain doing to improve In the ever-changing food pe r f o r m a n c e . in d u s t r y , the dynamics continue to drive logistics professionals toward more creative, innovative supply chain solutions. 3 Di s t r i b u t i o n Bu s i n e s s In This Issue: Ma n a g e m e n t Jo u r n a l Amy Z. Thorn Special Focus Publisher, Editorial Director Michael Schwartz Editor on Lean, Smart John T. Thorn Executive Publisher Ron Malec Supply Chains Director Creative Services Susanne Munford Administrative Manager Today, management at all Mike Hrabina‘s article. levels is expected to embrace Another major factor driving Editorial Advisory Board smart technologies, secure the U.S. economy in 2004 is Dr. Michael Crum their supply chains, and “think security and the war on terror- Iowa State University lean.“ This issue of the journal ism. In the U.S. post 9/11, busi- Dr. O. Keith Helferich proves that distribution busi- nesses have had to take a hard Central Michigan University ness management is no excep- look at their supply chain‘s Dr. Jezdimir Knezevic tion. It‘s all part of survival in security policy. Companies that MIRCE Akademy, U.K. the business world. Hopefully have met the challenge have Detlef Spee this issue will help you under- seen improved business per- Fraunhofer Institute, stand how to prepare for the formance measured in terms University of Dortmund, many technological, political, of cost reduction, operation Germany and ecological challenges that efficiency, and customer satis- lie ahead. faction. Up-to-date information Published quarterly by: There are some companies on this timely topic can be that have received awards for found in the article, Securing Distribution Business Management Association doing just this. Like the Circle the Food Supply Chain. of Excellence Award winner On the economic front 2938 Columbia Ave., Suite 1102 Kraft, a company that recog- there‘s been talk about manu- Lancaster, PA 17603 nizes that over the long term, facturing outlook. In the begin- Phone: 717-295-0033 some sustainable ecological ning of 2004 it looked bleak but Fax: 717-299-2154 e-mail: [email protected] practices can increase product recent data shows an upward www.DCenter.com quality and actually reduce trend. One reason for the co s t . recovery is that so many man- Distribution Business Management Journal A DBM Publication All businesses can learn from ufacturers are working leaner 2938 Columbia Avenue, Suite 1102 Lancaster, PA 17603 the food industry where the and smarter. Efficient supply Internet: http://www.DCenter.com necessity of the just-in-time chains may be the key to main- Journal Reprints: 717-295-0033 delivery at the lowest total cost taining a competitive edge in Distribution Business Management Journal (ISSN 1535- 1254) is published quarterly by DBM, Inc., 2938 requires a lean, streamlined, the global economy. A detailed Columbia Avenue, Suite 1102, Lancaster, PA 17603, phone 717-295-0033, fax, 717-299-2154, internet cost-effective supply chain, account can be found in Dr. http://www.DCenter.com. Periodicals postage paid at according to Rick Blasgen, V.P. Alexis Summers, refereed arti- Lancaster, PA and at additional mailing offices. Postmaster send address changes to DBM Journal, of Supply Chain at ConAgra cle on “Using lean thinking in 2938 Columbia Avenue, Suite 1102, Lancaster, PA 17603. Subscriptions in the U.S. $20.00 for one year, and this issue‘s thought leader- Distribution Business $35.00 for two years, single copies $5.00. Subscriptions ship author. Management.“ in Canada $25.00 for one year, $45.00 for two years, sin - gle copies $7.00. Outside the U.S. and Canada, $30.00 Modern businesses have also This issue also highlights the for one year, $55.00 for two years. International single copy $9.00. Send remittance in advance to DBM, 2938 relied heavily upon technology Annual Distribution Business Columbia Avenue, Suite 1102, Lancaster, PA 17603. as a way to increase quality Management Conference co- Printed in the USA copyright©2004 by DBM, Inc. and reduce costs. A hot topic located with DC Expo at the No part of this publication may be reproduced or trans- in the press lately is RFID. In Navy Pier in Chicago. This mitted by any means without permission from the pub- lisher. Permission to photocopy for internet use or the this issue you can learn about years‘ event offers an interac- internal use of specific clients is granted by DBM Inc. technologies that are changing tive conference dedicated to for libraries and other users registered with the Copyright Clearance Center, CCC provided that a base our world like the Smart Chip education in the distribution fee of $1.25 per copy of the article plus 60 cents per page is paid directly to CCC, 222 Rosewood Dr., technology talked about in and logistics industries. Danvers, MA 01923 DB M J 4 DB M J Letter From the Editor within the box, literally and knowhow is Michael Hrabina and fi g u r a t i v e l y . his “Smart Chip“ article. The Indeed, as we see companies future is here. As the personal and individuals meet the computer made a dinosaur of the challenges before them, success mainframe, so too may the most often comes from a fresh “Smart Chip,“ a tiny, wireless perspective on familiar material, device capable of transferring not from a mysterious ether of terra bytes of information without answers “outside the box“ as it its own power source, antiquate were. The answers are in the box the current supply chain with us already. Our task is to operation. become the Magellan of our own Dr . Alexis Sommers of the boxes. University of New Haven, brings Does a company measure what the thought of the East together it should when gauging its own with the business of the Wes t efficiency? How does a company with a concept known as, “Lea n ma k e environmentally friendly Th i n k i n g .“ Focusing on the initiatives and disaster relief cost distribution side of logistics, effective? Is the company Sommers explains how this Customer Service: conducting itself the best way Japanese concept seeks to Still The Bottom Line possible? Are we continuing to eliminate all waste from business, satisfy our customers while creating a “le a n “ company with a Lately I‘ve been giving the idea expanding that very base? robust profit margin. of “customer service“ more These are some of the Does a high fill rate alone thought than I ever had. Fir s t , questions facing business today necessarily correlate to satisfied because I‘m the new editor of and, thankfully, we need not tap customers? Kate Vitasek and Kar l Distribution Business the answer ether to solve them.