Supply chain analytics was the theme of the Fourth Annual Business Analytics Workshop, held in College Park, Md., on Friday, May 2, 2014. Co-sponsored by the University of Maryland’s Robert H. Smith School of Business and IBM, the day-long workshop consisted of topics ranging from cyber supply chain risk management to disaster response planning and logistics. The workshop provided ample time for questions from the audience and speakers delivered real-time solutions to some of the attendees.
The keynote speaker was the Honorable Jacques S. Gansler, former Under Secretary of Defense for Acquisition, Technology, and Logistics. Gansler is a professor in the University of Maryland’s School of Public Policy and director of the Center for Public Policy and Private Enterprise. He holds the Roger C. Lipitz Chair in Public Policy and Private Enterprise.
“Analytics is critical to logistics and supply chain, and in turn defense,” said Gansler, whose discussion focused on logistics in the federal government – specifically, the Department of Defense (DOD). Gansler said that industry is investing twice as much in research as the federal government and that in order for the U.S. to have world-class logistics, the federal government needs to change the way it does business. “Right now we are working with more than 2,000 individual IT systems,” he said.
Gansler had some recommendations for improvement, including redesigning contract award mechanisms, contract terms and contract management policies to properly incentivize contractors and to achieve better outcomes. He noted that the current trend of always selecting the company with the lowest price technically acceptable (LPTA) bid has not been effective.
Pitipong Lin; a senior technical staff member in Smarter Analytics, IBM Integrated Supply Chain; discussed IBM's Integrated Supply Chain and how big data and analytics capabilities are powering the current evolution of the supply chain. Lin said IBM’s vision is “to provide visibility across existing applications and data sources for a predictive and smarter supply chain.”
Sandy Boyson, professor and co-director of the Supply Chain Management Center at Smith, gave an overview of cyber supply chain risk management. He discussed how the center is working to revolutionize the strategic control of critical IT systems. Holly Mann, director of Smith IT, gave a demo of the new portal the school has developed for National Institute of Standards and Technology (NIST).
Leanne Viera and Sung Seo, from IBM Global Business Services, discussed disaster response planning and logistics. They agreed that it is not easy to plan for a disaster. Some events (hurricanes) can be anticipated and so advanced planning is possible, while other events (tornadoes) allow for little preparation. Some are man-made and some are natural disasters. Planning models should factor in multiplicity, density and intensity. The high degree of uncertainty leads to many challenges: stockpiled commodities will go wasted if no disaster comes, leading both to increased costs and bad publicity. “No matter the preparation, there will always be the unknown and unexpected,” said Viera.
Tunay Tunca; associate professor of decision, operations, and information technology at Smith; discussed supplier finance, from an analytics perspective. While reviewing different financing scenarios, he analyzed various supply chain architectures and policies where a dominant retailer or distributor plays a role in guaranteeing loans for small suppliers or manufacturers.
Young Lee, an IBM master inventor at the IBM Thomas J. Watson Research Center, gave an enlightening talk on how to make smarter supply chain decisions. He reviewed a project that helped save $1 billion by reengineering the supply chain for McKesson, a health care services company.
Wedad Elmaghraby, associate professor of management science and operations management at Smith, gave the final presentation on pricing tools and sales people. She discussed the challenges in trying to get sales people to change their behavior based on the pricing recommendation from a pricing tool.
The workshop ended with a panel discussion on supply chain management moderated by event organizer Michael Ball, senior associate dean for faculty and research and Dean's Chair in Management Science. Panelists included Arnold Greenland, Distinguished Engineer, IBM Global Business Services (retired); Rich Wong, Lead Operations Analyst, UPS; and Russell Barton, Senior Associate Dean and Professor of Supply Chain and Information Systems at the Smeal College of Business, Pennsylvania State University. The panelists discussed supply chain game changers like GPS, RFID, mobile, social, big data, and the cloud.
“This workshop continues to bring together thought leaders in the field of business analytics and this year’s event offered a great look into the power of data on the supply chain,” said Ball. “The success of this workshop is particularly thrilling for me because I’ve been doing ‘analytics’ for decades – long before it was called ‘analytics’ and became such a trendy topic.’”
Conference organizer Frank Stein, IBM Analytics Solution Center, added, “Supply chain and logistics has been a hallmark of operations research. We are pleased that analytics has moved from geeky to sexy!”
About Supply Chain Analytics
Companies and government agencies have recognized for many years that understanding and managing their supply chains brings competitive advantage for businesses and high performance to the mission for government agencies. Over the past few years there has been unprecedented change to supply chain data. It is more pervasive to have it and it much more quickly available, due to influences such imbedded measurement capabilities (e.g., RFID) and real time systems that capture and aggregate data on massive scales. This availability of data creates opportunities to analyze, extract, and utilize this data to identify patterns, and channel this information to better decision making. Business analytics techniques such as statistical analysis, data mining, and network modeling are uniquely valuable in taking advantage of these new and extremely rich sources information. Potential related applications cover a wide range, including the Department of Defense, U.S. Postal Service, Department of Homeland Security, and many others.
Alissa Arford, Office of Marketing Communications