(whooshing) - Hi, everyone. Welcome to Suffolk University's Spring 2022 Supply Chain Seminar series. This is the second event of the series, titled, "Innovative Technologies in Global Supply Chains". So I'm glad we have a great panel today. They all have extensive professional experience in technologies and also supply chains.
First, Shawn is the head of the software engineering and supply chain inventory and planning and optimization at Wayfair. Martin is the president of the supply chain systems, technology company supply chain. Alex is the director of client solutions and global strategy accounts in supply chain and logistics technology. So company name is a Advatix.
Finally, Alan is the moderator today. He's the president of GDA Consulting and Training Company. Alan is affiliated with the Association for Supply Chain Management, and he was a chair of the International Board of Directors in APICS, which is American Production and Inventory Control Society. But the organization is now the Association for Supply Chain Management. So Alan, thank you.
- Good to be here. So this is a really exciting program today because we are going to talk about something that's near and dear to every supply chain professional. You know, it's reasonable to state that global supply chains are in crisis today.
The depth and breadth of the crisis could be perhaps debatable, but its existence is certain. Global parts shortages, increasing lead time, transportation bottlenecks, and bottlenecks, by the way, especially in Western ports, talent shortages, pandemic induced business model changes, and now if that's not enough, even war in Europe's Eastern region have all conspired to create the most volatile, complex and perhaps chaotic global supply chain that certainly I've ever seen in my career. So to help participants today who engage every day in this messy supply chain world that we're dealing with now, we would like to pose a few questions to our panelists. So we've brought together a series or a number of panelists that have direct background in technology, along with direct background in all facets of global supply chain management and leadership.
So that combination of technological leadership and supply chain leadership creates a great learning atmosphere today. So I would like to pose the first question, I have a series of questions, and we'll see how they go. And by the way, everybody who's listening today, please submit your questions as we go along.
We probably won't wait till the end of the program to engage the panelists in answering some of those questions. So submit 'em, we'll be monitoring the question box and we'll try to provide some information back to you and get the panelists engaged in your specific issues. So here's my first question to all the panelists. I just look for one of you to jump in as quick as possible. The question is this: From the perspective of your company, considering the technologies and the products and services that you provide into the supply chain world, what will be, what do you think will be the role of technology and advanced technologies in supply chain, in let's just say post pandemic. So let's take the pandemic issue kind of off the table and talk about it after the pandemic.
Any one of the panelists wanna jump in on this? - [Shawn] I can go. - Good. - I'll start with sharing my company, what do they do first, and I have a short video that I'd like to share. - [Narrator] Wayfair, you got what I need, and when I find what I need, it feels pretty sweet. ♪ You know, the feeling ♪ ♪ Yeah, that's the one ♪ ♪ It's the feeling of done and done ♪ ♪ It's so much fun ♪ ♪ Easy as a click and then comes quick ♪ ♪ Say it won't come easy ♪ ♪ Click, cool, sleep, breezy ♪ ♪ Then more fun ♪ ♪ It can even be crazy. ♪
♪ So be one of a kind ♪ ♪ Yeah, baby, get a deal done ♪ ♪ Looks fine ♪ ♪ Just kick back, relax ♪ ♪ With Wayfair, you're done ♪ ♪ You know the feeling ♪ ♪ Yeah, that's the one ♪ ♪ It's the feeling of done and done ♪ ♪ It's so much fun ♪ ♪ Wayfair, you got just what I need ♪ ♪ And it feels really sweet ♪ ♪ Yeah, yeah, yeah ♪ ♪ You know the feeling ♪ ♪ That's the one ♪ ♪ It's the feeling of done, and done ♪ ♪ So much fun ♪ - [Narrator] Bring home the feeling at wayfair.com. - Right, that's it. So, Hey everybody, I'm Shawn Liao. I'm from Wayfair and-- - [Man] In today's video, I'm going to be discussing with you the true cost of renovate. We're not just talking dollars. We're talking-- - Sorry, hold on one sec.
(overlapping discussion) - [Alan] While he's doing that, I'd like to thank Shawn by the way for the great table that I bought from Wayfair that all my equipment is sitting on in my studio right now. Good job. - Yeah, hey, I got my video playing on the background? That's why I was interrupting myself. Okay, could you guys hear me okay now? - [Alan] Yes. - Perfect, okay, great.
So, alright, so I'm the head of engineering for Wayfair for the inventory planning and optimization. So to answer this question about what role does technology play in supply chain, I think I need to first talk a bit about what is supply chain? What does supply chain mean to a company like Wayfair? Right, so what is Wayfair first of all? So Wayfair exists to be the destination for all things home, helping everyone anywhere to create their feelings of home. As you can see it in the video, it's not just (speaking faintly). it's really anything that you can purchase for your home.
So I think the first thing that I'd like to explain, the supply chain management in Wayfair, what are they? So it is really pretty comprehensive. So it comparison, the planning, the enablement, and the orchestration, and execution of physical flow of the goods and services, as well as they're related information. It includes all storage, handling, transportation processes that allows us to move our suppliers products from their factories, many of them in China, to end customers in predominantly US and Europe. And we need to basically, or also actually, they are also the reverse logistic component of that, which means when customers return their product, we need to be able to bring those, you know, products back to either our fulfillment centers or even to suppliers. So what makes supply chain unique for Wayfair is really that we require, the supply chain capabilities go far beyond a regular eCommerce setup. so what we are talking about there is one, many to many network with thousands of pickup locations in North America and Europe.
Also a very diverse product portfolio. You know, you guys, again, I mentioned about this is everything home, and we have millions of products, different products that we're selling our website. And oftentimes we need to be able to support outside of the normal flow of goods. You know, for example, you know, furniture is bulky, fragile, oftentimes they're multi box, and they need to be prioritized.
So we also need to do in-room delivery and we also offer repair services. So all of those specialized capabilities require our supply chain to be in a position that can make a substantial difference in our business. so basically, so that's what Wayfair supply chain does. And now back to technology.
What's the role of technology in supply chain for Wayfair? I mean, in short, it is really front and center, right, and it's in all those components I just talked about earlier. For example, from a customer experience standpoint, we need to enable fast delivery. How do we enable fast delivery? We wanna be able to place our product in the warehouse that's closer to our demand.
So how do you enable that? How, how do you support that kind of capability? You need to have a really great demand forecasting capability. You need to understand where the customers purchase behaviors are, and all those are enabled by technology. Now, once you, once someone clicks on a Buy button in a, you know, in a website, we wanna be able to provide a really good promise on when the delivery's gonna happen. Is that one day, two days, or maybe it's gonna take a week because, you know, it's big items. We wanna promise to be very accurate, and how do enable that technology? As I mentioned earlier, bulky items are very difficult to transport.
You know, there could be a lot of incidents due to damages and things like that. How do we enable that tight integration of our technology with transportation systems. Reverse logistics, also super difficult to support in this kind of, you know, product that we are servicing to our customers. So the other major part of technology enablement for the supply chain is the cost reduction. And those, you know, pre-pandemic, during pandemic, and the post pandemic, the cost and inflation has gone up a ton.
So how do we continue keeping those costs to a level where we can still support, you know, our customer's needs that includes the opportunity in optimizing our transport costs, labor cost, inventory holding costs, and the product cost itself. So in order to support all of those different cost reductions, technology is a key enabler. So I'm gonna pause here, and I think it's been a few minutes here, so I'm gonna pause here, and I think, needless to say, that the technology is absolutely in the front and center of the supply chain management. - I'm gonna ask a question real quick about this. So in the Wayfair's business, there must be a lot of returns.
And so can you speak for just a second, we don't have much time left, move on to the others, but can you talk a little bit about the dilemma and the solutions to managing reverse logistics? - Yeah, so the dilemma really is the cost trade off, right? So in order to enable a seamless return, it requires, you know, a lot of costs, transportation costs, you know, restocking costs, and at the same time, we cannot just give a real product because those are expensive products. You know, so there's a balance between how do you, you know, really determine what type product you want even a customer to return in the first place, and then the secondly, enable all the partners that we are engaging from transport standpoint, from the, you know, warehousing standpoint, to be able to efficiently have the product return into our network. So the technology there is really playing a role in the sense, like understanding what profile product we even want to support the process, and then also enable that process to be very efficient.
- Right, does anybody else wanna jump in on this and talk about the products and services in your company and how some of those tools have really improved some of your clients and some of your customers' ways that they've managed their supply chain during the pandemic, and maybe even talk about how those might evolve and help them post pandemic as well. Anybody wanna jump in on this? - Yeah, Alan, and I'll be more than happy to do that. Hi everyone, I am Martin Mirsky, supply chain systems, and I started my career in the supply chain as a chemical engineer for Dow Chemical. And I learned very early on in my career that you're dealing with two situations all the time, and we used to automate our plants where we had computer control, this goes all the way back to the seventies, where we had a computer program that would actually control how a plant would operate. And you would program those computers to handle the normal operations of making those products. But you'll also then had to overlay that with extraordinary situations, and you had to also program, if this should fail, what do you do about it, and how do you recover back to where you were during the processing of those chemicals? And so these are very complex thought processes of how to deal with that, and now you're not even dealing just in days and weeks and months, you're dealing in microseconds, milliseconds, you know, in a very constant flow of information that you're gathering from your plant, analyzing with algorithms what to do about it, and then sending output to actuators.
Supply chain is very much the same way. You're dealing with inputs, analysis and actions. And so let me share with you a couple slides. Let's see. I'll kind of illustrate the point for everybody.
So let's just take, for example, we have a hurricane coming in. do all the preparations for dealing with hurricanes happen just as the hurricane is hitting the coast? No, you have to layer that kind of activity into preplanning that maybe is months and years ahead of time, And then as a hurricane gets closer, you're going to be doing other things like allocating resources and how much do you need. And then when it's finally hitting, you have a lot of activities.
Planning in this kind of a world when we have pandemics and supply chain shortages, and you understand that you have a global economy out there, and we're very integrated with those other countries around the world. We have to think about those normal operations on how to be more efficient, but also the risk mitigation that you need to put in place, here again, way ahead of time of when you actually need it. And if you don't do that planning, then you are gonna suffer the consequences of not being prepared properly for those kinds of events, even in the case of war.
So what we do as a company, of supply chain systems, is we create computer models, and with those models, we incorporate all of that data that we could use to predict what would happen to be more efficient and to be more predictive of what would happen if we have some extraordinary event. And even when something happens with that model, you can quickly analyze that and incorporate the new data and then adjust your supply chain. I almost find it in unconscionable that we have such shortages out there, and all it really indicates to me is that companies have not done their due diligence of thinking about that kind of risk. They should have these predictive models in there on what they need to do with their resources, with their supply chain partners and their customers, and try to manage all of these different objective functions. - You know, Martin, I'm gonna interrupt just a second because I think you've said something that's really valuable to all of our participants today. You know, it's been said in the people who study safety and industrial safety, they've said, almost every major safety disaster originated from a lack of imagination that that kind of thing could occur in the first place.
Indeed, even the 9/11 report, on that terrible incident in 2001, said there was a lack of imagination that that could happen. So the idea of predictive modeling is, I think, should be very intriguing to a lot of today's participants. But doesn't that start with imagination.
I mean, before you can have the algorithm, don't you have to imagine? So how do you get executives to think a little bit deeper and to imagine the things. When I started today, I talked about all the things we're facing today, now throwing, you know, war in Europe on it. How do you get executives to imagine the things that can happen so they can build predictive models from that? - Well, I have to react to that in kind of a negative way, is that companies used to think more long term and with kind of the shift in being more stock market focused as a company, they're more concerned for short term profits and they don't do that long term planning. So it's almost the environment of how we think about our companies has a direct impact on how well we actually plan for the future.
So if you're, you know, if you have people who are rewarded on the short term and not on the long term, you can almost expect what the outcome is going to be. So it's the same thing like, look in this slide right here with New Orleans and preparing for the dikes. That didn't happen overnight. They had to prepare for years to make sure that those dikes were going to be adequate enough for the kinds of storms that they might expect. And really this is a layered approach to planning. You have to plan years out, you have to plan months out, weeks, and what you're going to do tomorrow.
So this is a very complex activity, and if I was to recommend to anybody who's in the supply chain area, the more that they can learn about building these kinds of models and what kind of data is going to be required to go into those models to do those predictions, this is gonna be the battleground of the future with supply chains. (overlapping discussion) That they plan their supply chains and the technologies that they employ in order to build these predictive models. - Yeah, so aren't you really talking about resiliency as a core business practice? - Absolutely, absolutely. That has to be part of every businesses plan because they have to, you know, it's not just about efficiency during normal times when you can have JIT. You're also gonna have to have safety stocks for the eventuality of not only having fluctuations in demand, but also supply chain variation.
And now we're seeing it coming home to roost where we're talking about having to build more inventories, or you have very close relationships with suppliers that guarantee those supplies. But it also has to do with supply chain design and making those much shorter and closer to home. Where companies used to be making a lot of their own components, now they outsource and they will get their components all over the world. That makes it more dangerous. It makes it more unpredictable, and longer lead times. So the design of the supply chain is critical when at the start of this whole planning process.
- I think that goes beyond just intelligence. I think that's wisdom that everybody should be paying attention to, that this resiliency and this imagination of what can go wrong and building a model. It's not like a hurricane is a new phenomena, right? These things happen, but we just don't know when and where they're gonna happen, and that resiliency, I think that you're talking about is something that has to be part of the normal daily dialogue in manufacturing and distribution companies. Does anybody else wanna jump in on this question before I go to the next question? - Thank you very much for the invitation. I mention a little bit about Advatix for a couple of minutes.
We are supply chain consulting and technology company. We offer a wide variety of supply chain related services across the world. And let me share a little bit of my screen here. We concentrate primarily on people, processes and technology. We believe that technology without the people behind might take you nowhere, and that's the reason why we put a lot of emphasis on people, training people, bringing the right people to the companies, et cetera.
Our offerings can be summarized as follows. The supply chain consulting technology and control tower, and we also have our own network of fulfillment centers under the XPDEL brand. We cover the country and we can deliver within two days, to 98% of the population in the US. So what do we do? We are on a mission to accelerate profitable growth for businesses and we do that by bringing our supply chain expertise to our customers and by developing and implementing our cloud based technology. We have an advanced fulfillment execution platform, a logistics execution platform, advanced analytics platform, and other platforms related to business intelligence, such as S&OP, or what is known as sales and operations planning.
These technologies coupled with our extensive experience in transforming supply chains, logistics and fulfillment operations gave us a winning formula. We have been barely four years in the market and among our customers, now we have fortune 500 companies, as well as some well known internet e-commerce companies who became unicorns during the last five years. And we started working with them a very early stage. We believed in what they were doing, and now they are big players. They are loyal to us because they recognize that, without our help, it would have been a rocky path for them, and probably they wouldn't be where they are now. And because of that reason, we as a company also have grown tremendously from two employees in 2017 to more than 500 today across four continents.
We are one of the, we are among the top 500 fastest growing private companies in America according to the latest list of the Inc 5,000, released in September. So that's, we consider that a big accomplishment. And among other things, we help companies with 3PL services such as warehousing, online order fulfillment and last mile delivery as well. And on the consulting side, we assist our customers with distribution network design, operational flows, inventory management, labor planning, and logistics solutions. This is all the most efficient production plans and supply chains can be designed and implemented. We help companies to improve their supply chain, regardless of if they are a startup or a well established multinational corporation.
We support them as a true partner. Our goal is to help companies to stay ahead of their competition and to cope with any unexpected event, like my colleagues have been mentioning. We can create digital twins to simulate supply chain and distribution networks, and we don't stop there. We can also simulate the warehouse operation.
This is to allow tests and fine tune processes that perhaps will impact the distribution network. And I, we have been talking about it for a little while now, but not only the distribution network, also the warehouse operation. So the what-if scenarios that you were mentioning, these simulations allow the companies to react to unexpected events very quickly and in a more efficient way, but we are on the way there to hold their hands in case that they need an extra warehouse, they need to change the transportation system. As a company, we have space with some of the airlines that are well known, so we can, we can immediately switch the routes, et cetera, with these companies.
And briefly, I will show some of the platforms that we have developed. We have an order management system. And if you noticed, I mentioned our warehouse, our fulfillment execution platform, and then a logistics execution platform. This is because we focus on the execution.
During the last few years, e-commerce transformed everything, and now everything has to move fast. So the typical warehouse management systems and the typical transportation management systems don't necessarily fit very well with the new way of delivering the goods from e-commerce companies. We have also what we call our Advatix Lab, developing some artificial intelligence solutions for some retail companies as well. So I can probably talk for hours about the many services that we have, but going back to the original question of how technology can help the supply chain.
We strongly believe that technology, if you don't have it, you have a disadvantage. But it's not only the technology, as I mentioned. It's the people, but it's also the data.
How are you handling your data? Data, we know, is the new goal. But if you have data silos, you don't have a structured data, you are not gonna go too far with that data. So we believe in partnering with these companies and show them what is possible with their data. - Yeah, so thank you, Alex.
I'd like to build on what Alex has just talked about, and maybe we can start with Alan after I, after I ask this question. So, you know, I want you to think about not the past, but I want you to think about the future now. So I want you to think about the technologies that can assist supply chain participants to respond to all those evils that I talked about before: The increasing lead times, the bottlenecks, the global chaos, the shortages that we're dealing with, and of course now even inflation. You know, what technologies do you think, and maybe rate them if you have to, but what technologies do you think are going to lead us from chaos to clarity? Maybe Alan wants to start with that, or I'm sorry, not Alan, I meant I met Shawn. Sorry about that.
- No problem. You know, I think as a way talking about technology, oftentimes, you know, we talk about the kind of new emerging stuff like machine learning, AI, IoT, blockchain, stuff like that... You know, in my view, I think it's, there's really not much of a gap of the current technology exists in the marketplace. It's really how to apply them, you know, in solving the problems. So in my view, I'm gonna actually reiterate a couple of things that both Martin Alex mentioned in their discussion earlier. So building a resilient supply chain from the, you know, start from network design, right, perspective.
And so what technology, you know, we wanna let live. You know, operations research have developed the BNA programming or messenger programming from many, many years ago, right? This is not newly emerging technology, but it is really applying those technology into that design that is a key, in my opinion. And I would also mention, Alex mentioned about the simulation, right? So I think building the resilient supply chain gives you the ability to handle those exceptions, but how do you handle those exceptions with agility is a complete different question to answer. I think, simulation platform with ability to answer what-if scenarios quickly given what you've not seen and be able to very quickly recalibrate your supply chain to deal with the new situation is super important.
So to me, the technology component of that is be able to leverage that data input and put into a simulation model and be able to then very quickly produce an outcome based on a new situation, and then that informs your supply chain operations to be able to react to those very quickly is super important component of the technology and supply chain. - Yeah, so saying all that, so, you know, think about this, simulation, advanced algorithms, predictive modeling, agility thinking, resilient thinking, where are we gonna get the talent to do this? You know, I'm thinking that, you know, Martin seemed to have some thoughts about this, so maybe Martin or Shawn, maybe you can jump in and talk a little bit about this, because I think, you know, I just recently read a report that said, just in North America, there's 900,000 individuals short in the supply chain world, and about 1.8 million worldwide. It's increasing, I'm telling my kids, all my college age kids, Forget about all that other stuff. Go into supply chain because there's a lot of jobs. But it seems to me that the gap is getting bigger, not smaller.
And the gap is not just about supply chain smart people. It's also about technology smart people and application smart people in this. So maybe Martin or Shawn, maybe you can jump in on this one. - Yeah, I'd be more than happy to. And that is a key concern, is the talent pool that we're looking at.
A lot of education is very narrowly focused and it's almost like being multi-talented and having backgrounds in multiple areas. That interdisciplinary type of a background is critically important in order to create these models, in order to be able to manage and maintain the models and understand the business relationship. And what I like to term, when I was thinking about this seminar, I thought in terms of managing time in all these multiple dimensions that we have to deal with. So there is a structure to how you plan for these things.
So a lot of it comes from the experience of working for different companies in different functions at different levels. And we all see these levels as we grow through our career, and a lot of it does come from that experience. But there are certain key fundamental skill sets and education that would help the students out there to prepare for these kinds of jobs in the future.
And let me just here again, go back to a couple slides that kind of illustrate these points. You know, if you're working with the top level management, the executive board, you're doing strategic planning, and they would have separate models for that. And the objective, the business objective is how do you look at new markets and how do you look at new manufacturing. And tactical planning? Now you're thinking about profitability. You know, what kind of suppliers are you using? Where are they located? You know, what kind of labor do we need? What kind of talent pool do we need? Operational scheduling gets down to actually managing your costs and your margins.
And this is a different set of models that has a different time horizon. It has a different time buckets to these things. And then finally you gotta schedule your manufacturing plants, and you have to have feasibility in your systems. And I have to laugh a little bit.
I had arguments internal to Dow Chemical when we were implementing SAP, that that was a transaction system, and we had to prepare and have models for predicting the future. It's not just about what we're committing to today and what happened in the past. It's also looking at that risk assessment, looking down the road and trying to make sure that we're prepared for being more efficient and being more predictive about extraordinary events.
So it was critically important to try to understand this technology and I came up through the ranks and I understood because I did all of these things. I had to work in different businesses and have that experience as saying, What are the business questions? What are the business objectives? And you learn that over time. And I wish we did more education in the colleges.
It used to be just having MBA programs. Now they have supply chain disciplines within the MBA programs. You know, where it used to be just financially focused. Now it's more tangible with the material focus on it. So, you know, when I think about the talent pool, yeah, if we wanna be competing with countries like China that are really looking down the road, we have to be thinking more long term.
We have to prepare for those kinds of things, and actually think in terms of very large scope things like Tesla was doing, trying to say, If we're going to grow, we're gonna have to look at the sources of our different raw materials. Are they reliable? How much is there? Where are they? How are we gonna get those to manufacturing? So you can see how detailed during their battery day they were in their analysis of how they were gonna grow their business. So that was some very high level strategic thinking, but they had to go back and analyze all that data. So if you think about that from a talent point of view, you have to understand what kind of data's out there, how are you quickly going to get that data into these models, and basically automate your business decision making? This can be premeditated. I do not accept the idea that you cannot build these models ahead of time and predict these kinds of situations. - So switching gears, thank you, by the way.
Martin, you run a, you know, leading consulting firm that focuses a lot on automation technology in the supply chain. So surely you deal with this talent issue all the time. Are there any things that leaders of manufacturing and distribution companies, and maybe even healthcare companies and their distribution networks, is there anything that they can do to develop or to attract the kinds of talent? And maybe you can even speak to the kinds of talent that even your organization uses? - Well, you know, I find it interesting that we used to invest in our people, and the new world order of talent out there is that there's emerging technologies that are happening constantly. So it's not a matter of just learning old technologies.
It's really always pushing the envelope of looking for new technologies. You know, the old technology might be blockchain right now, and hashgraph is a newer technology that we need to be thinking about because it has a more efficient way of dealing with the execution of transactions, smart contracts, being able to handle financial transactions, currencies, languages around the world. I mean, we have a very complex business environment and we're trying to solve those problems of how to deal with all those different dimensions to running businesses today. So we have to invest in our people, we have to encourage them, support them, fund them, give them the time to go and research and experiment with these new technologies and how to incorporate them. And this is a longer term planning process, again, from a labor, distribution and a labor development point of view, and if we are shortsighted about that, we're really gonna lose the race. So that's what I would say to all business executives today, that you have to start investing not only in the technology, but in that talent pool.
Not just looking at what people knew in the past, but that attitude of going out there and learning as much as they can about what's emerging, what would really help, what tools can I apply that will really help my fundamental business decision making. - Yeah, no, you know, listening to you, Marvin, I noted the comment about hashgraph. So this is, you're the second human being in the supply chain world that I've heard talk about hashgraph. I've heard hundreds of people in the IT world talk about it, but this is, this is illustrative of the issues with supply chain now, is the technology is developing so quickly, you cannot become outdated. You cannot allow that in your company or in yourself. I tell everybody, I wake up every morning trying to figure out how to be a 66 year old millennial, because we have to be thinking that way.
So Alex, your business is one that depends on this kind of talent to develop technologies. Can you speak a little bit about the technologies for the future and the talent for the future in supply chain, certainly in, you have experience with these very large accounts and very large projects. Maybe you can talk a little bit about that. - Yes, absolutely, and lemme share my screen again here.
I can just show perhaps one quick example of how we approach a challenge. In this case, it was the optimization of a very large company doing last mile deliveries. And they had a huge problem. We are talking 7,000, about that, per week deliveries in a small region. And so there was an under-utilization of their assets.
They had no relevant data of what was happening, and it was really bringing the company down to their knees. They said, well, our business is not going to go anywhere. We are about to close the doors. So I said, Let us take a look at it. So as you noticed, the approach was we create a complete different model and processes. But one of the, the things that we did is we changed the management, believe it or not.
(laughing) And that was a key part of the process. So we eventually turned the solution and they are still running and profitable and growing and growing along with us. If you go to our website, advatix.com/careers, you will see, we are actually looking for a lot of people. We have maybe a hundred openings there, because it's not only for our own company.
The department right now within our corporation that is growing the fastest is the human resources, because we help these companies to not only establish new processes, we bring technology, whether it is ours or somebody else's technology, whatever you know, is the right technology for the challenge, and we bring people as well, if they don't have it, or we train their people. So we have all these learning systems and platforms that we can immediately set up and start training their people from the warehouse all the way to the CEO, believe it or not, because it's a cultural change in many cases. You cannot have a meeting to forecast, let's say, the inventory for the next year, and you have the sales people saying, okay, I will sell $100 million for next year, and then you have the marketing people saying, I will sell $300 million next year, and then you have finance forecasting something between $50 and $150 million. So who's right? Everybody has a little different agenda. So when you generate data and not keep the data in silos, and I insist on this, this is a key part of the, of any business now in this age, when you have all the data and you have full transparency across the departments, then you can move forward fast. Otherwise it's very, very, very difficult.
And going back to the talent pool, whether it is we train people or we bring the people that we need, but we are definitely looking for these young ones that, yes, they have an expertise, let's say supply chain, but they have to know a little bit about technology, they have to know a little bit about business because technology by itself, as I mentioned before, is not too relevant. You have to have the people and you have to have the processes. - You know, it's, to me, it's a very interesting slide and a very interesting discussion. I'm, you know, I'm thinking, as you're talking about transparency, I'm wondering where the state of technology is related to multi-tier transparency. So let's imagine in a perfect world where the manufacturer of the aircraft can see the suppliers on the components, can see what they're doing, and then they can see down below that, and eventually all the way down to the bauxite mine where the aluminum comes from.
The ESG world, there's a desire to not only make sure that you run your companies in an ESG appropriate way, but your suppliers run it as well. And then who knows where that ends. Maybe you have to go all the way down. But can any of you talk, and it's up for anybody who wants to jump in, can you talk about the future, the technologies that are going to make some level of transparency down more than just to the suppliers, in other words, get transparency through the entire global network possible? Does that exist now? Does the technology, is it actually working anywhere now, and also again, how do you get the people, as well, to be able to manage and run and operate that kind of a technology? I think our users would be very interested, and our listeners would be very interested in hearing about that level of multi-tier transparency.
Anybody wanna jump at that? - I can mention a couple of things if-- - So, Alex, go ahead. - Yes, I don't know of a platform that allows you full transparency from the manufacturer all the way to the delivery of the product. However, we can do that. We can manage that for a company using different tools and training them to do that, or we do that for them.
And there are different ways that you can integrate with a manufacturer, with a distribution company, and tracking, you know, everything from A to B through APIs, perhaps EDI connections, but eventually you get all that data. I don't know of a platform, to be honest with you, that can have everything in one. Companies like Boeing, for instance, they have their own and they connect to everybody, and they know exactly what airplane in what city is going to need a replacement part, and they ship that part in advance because they know the airplane is going to be there for that will need a replacement for maintenance.
But that's a company of that size. - I asked the question, a little bit self-serving, I sit on the board of a large nutraceutical company, and our chairman asked the question one day, he said, Look, I'd like to know the field that the alfalfa came from and the pesticides used on that field. That's four levels down in the supply chain. And I think, you know, the food processing, I know that IBM has a great food industry set of applications to help that.
But I'm wondering how realistic that level of transparency is. I can see some of the benefits from it, but I'm wondering how realistic that might be and what might be involved in developing that. Anybody-- - Yeah, I can address that I think to some degree. I've been really investigating this whole area of hashgraph, and primarily for that exact reason. When companies back 20 years ago started looking at their internal systems of how they did their cash management, all their transactions, human resources, they came up with the ERP systems, these large just grand systems that dealt with all the internal transactions that a company had to deal with.
So there was, you know, SAP was one of those big companies that dealt with global systems, global information, but it was all internal to that same company. But what you have today now is all this interaction between companies around the world. So you have two basic kinds of networks out there. You have the public networks and you have the private networks. And so what has happened with a company like a Walmart or a Boeing, similar to what Alex was saying, they develop private networks to be able to deal with some of their other partners in the supply chain. What we need is more of these public networks where it's available, because it's like Xin was mentioning before that we have this many to many relationships that we have to gather data from.
It's not, not just a very defined network anymore. So in order for those growers and the fertilizer companies and everybody else who are part of the agricultural area, they have to have a public network that's relative to the food industry that they can share that information, and we can query that information so you can go back and find out what was the handling and the quality control and the sources of all this food. I actually was a vice president for supply chain for two food companies and these were the business questions that we had to try to deal with, is how are we going to guarantee that if there's a recall, where do you go back to in that source to make sure that you're pulling back the right food that's on the shelves and at the same time, still be efficient with delivering things quickly and not carrying too much inventory. So you all these multiple objectives that you're trying to deal with, you know, but what we needed is more visibility. We needed more data from all those other sources, and right now they're not available, but the technology is there, here, again, either with a blockchain, which I don't think is quite as efficient, but the hashgraph type of environment, where we could build those public networks for our food industry. - I can almost hear everybody's keyboards typing in, you know, Googling hashgraph right now, so I'm glad you brought that up.
Look, I think what we're talking about here in a sense is, is where transparency and predictive modeling can come together, that sounds to me like it could literally change our lives. I'd like Xin to talk a little bit maybe about this, because, you know, think about a company like Wayfair, is you have millions of customers, probably thousands of logistics assets in play at any point in time, you have warehouses, you have distribution centers, you have trucks, you have hundreds, if not thousands of suppliers. This is a many, not just a many, this is a whole lot to a whole lot sort of a relationship. It's a huge, huge complex network to be in the kind of business that Wayfair is in.
So how, you know, what sort of technologies do you think are going to, you know, change the nature of the way Wayfair might operate in the future? - You know, I think, again, it is how you implement the technology to me is a key versus the, you know, any emerging tooling. So like, obviously, so I guess to, you know, to reiterate what you mentioned about the capability, what we need is end to end visibility. Alex mention this multiple times also in his previous discussions, is that you need to be able to really have this sort of digital twin concept of your physical network. So understanding again, where are all your assets, how they're connected, what the flow looks like, and, and understand all those characteristics of your network, and then also have the ability to check those physical goods flowing through your network, as much real time basis as possible.
You know, one of technology out there is IOT, right, allows you to, you know, instantaneously report out where stuff is, you know, through RFID or wireless technologies. but none of those are new. I mean, they're in the industry for 50 years even for some of them. But how to integrate them all together into a single data platform that provides that cohesive end to end visibility is extremely difficult. Why that's difficult? Because data is disjointed.
They are siloed in various different places. There are multiple kind of systems, transport systems, warehouse management systems, inbound, you know, systems from the suppliers, the systems from your shipping partners, 3PLs, and all of them are not transparent, using your words you used earlier. So how do you connect them all together in a way that they can be shared across the entire network that's the biggest challenge? So to me, the technology there is designing that data platform that allows all those different systems to, I call it event streaming this information on a realtime basis, then harmonize them all together in a single platform that then you can put a advanced analytics, predictive analytics, and all this other modeling on top. That's the challenge that we have in new technology. - Yeah, so I think you're suggesting that the network effect here is the real challenge, and the technologies are developing. I'm reminded in the early days of factory automation, what we ended up with was a lot of islands of automation.
We ended up with machines that were very automated, but they didn't talk to very well together. They didn't communicate very well with the, with the overall ERP or business systems platforms. I wonder if that's not kind of where we're at in global supply chain today, where we have a lot of tools that don't really connect on a global basis, and if that's a true hypothesis, then what has to change in order to improve this global resiliency, this global transparency, this global capability in global supply chain. You know, maybe Alex, we haven't heard from Alex in a minute or two.
Maybe Alex has a comment on that. - Yes, and I would say part of the reason is because the larger the corporation, it seems that the more data, the technology they're using, you know, is a fact. So in many of those technologies, pulling the data and communicating with another technology, more modern technology is not that easy. And I say this because I am right now dealing with a company that is a publicly traded company, one of the leaders in their field and just communicating with our system, and I'm gonna share some of this slide here. - By the way, while he's pulling up that slide, I might remind everybody to submit questions. We're shy of questions from our participants out there, so please send them in, and so we can address them before we wrap the session up today.
- So we have a custom version of our systems for them, but now, you know, communicating to the ERP. SAP version, you know, five generations back, they don't even have a way to generate an API so we can communicate with them, and that is been a challenge, and the flow of the process is kind of a bottleneck right now just because of that fact. So we are, you know, working around, we have to pull that data manually and then clean that data and finally communicate it back and forth.
So some of the challenges that I see and probably happening with many companies, not necessarily in the technology environment, but, you know, chemical companies or petrochemical companies, companies that are not necessarily too deep into technology, they use technology, but they want to do it at the lower cost and in the most efficient way. They don't want to spend, perhaps, an enormous amount of, or millions of dollars in the latest and greatest. So that's something that I am seeing across the board. I don't know my colleagues, you know, what they have seen, but at a large scale, that is what I see. Medium size smaller companies, perhaps more recent ones growing, they don't have that much of a problem, but at the same time, they're not a big player in the environment.
- Anybody else wanna jump in on that too? Martin, you're on mute. - I wanna make one point that I think can't be overlooked. We have, a large part of the economy are much smaller companies, and it's a lot of the technologies are really focused on the very large companies or the mid-size, the large companies, multinationals. And in our world today, we have a lot of small companies that wanna try to compete on that global scale, compete with the big guys out there.
So one of the focuses of my company has been, let's look at the tools that they're currently using and see if we can integrate it and get them further up the ladder of technology so that they can actually do that planning and scheduling and be efficient with their assets, as well as being more predictive with how to manage their cash flow even better. So when we're looking at these things, I had to go back and say, all right, we're using Excel in a lot of cases. So we built some models on Excel so that they could actually have some of that capability without all the cost of putting in very expensive technologies that are really out of reach until they get to be a multimillion dollar or multibillion dollar company. So just to give a little bit of an indication of the things that we've done in this area, you can see what kind of things that we've been able to accomplish.
So this is an Excel program with a lot of VBA. So you're talking about other talents that you might wanna learn, underneath Excel, there's a whole programming language on how to automate the import of data, and Excel is very good at bringing in data from many different types of data sources, whether it be other Excel spreadsheets, databases, Oracle, SAP systems. So what we have done is we've integrated these tools that are very familiar to those smaller and mid-size companies and we bring that data in so we can build these predictive models and look out over time. But we have also recently expanded on that and we in integrated Python. Python is another one of those areas that has been used by machine learning and artificial intelligence. And so we're building the links in, to other databases with huge, huge amounts of data out there, but you have to put it into a usable form.
And that's what the algorithms do, is they concentrate your data and take out the relevant parts and you bring them into these models. So what you're seeing here is the output of a cloud based application, where we took that Excel spreadsheet, extended it into machine learning and artificial intelligence and coming up with very detailed schedules for manufacturing. And when you're one of your biggest assets that you have to manage is how efficient you are with your manufacturing operations, and you're using the same equipment to make multiple products. So this is a, what you'll see is kind of like the waterfall effect, where you can't make the same product on that same equipment at the same time. You have to stage it. And when you look at it in more detail, you'll see this more evidently, and you have different parts of your schedule where you have to set up the equipment.
You have to produce the product, then you have to clean up the equipment and get it ready for the next product. But you're also dealing with shift schedules, which makes it very complicated. So I just wanna, you know, kind of tie a bunch of things that we've been talking about together in a very tangible way, especially for the students out there, I would highly recommend that you learn Python or some of the more current programming languages that can be applied to the supply chain. And I found this to be very useful, and it brings in a lot of libraries that you can build these things fairly quickly.
So during the pandemic, when things got a little bit slower, I learned Python and incorporated it into supply chain planning. - So a great benefit of the pandemic for a lot of us in the consulting and technology world is that 2020 became one of the most creative years in most of our lives, didn't it, and that we, you know, here, you had an example, Martin learned Python. Hey Martin, can you do us a favor and pull up that Excel sheet again? - Oh yeah, sure. - I Wanna make a point here.
- All right. Hold on a second. - Yeah, go back a page or two there. So many of us remember the beginning of spreadsheets. So for the young people, I ask 'em what's VisiCalc. They have no idea what I'm talking about.
But ultimately we ended up with modern versions of Excel. Excel was created as basically an analytic tool. But isn't it interesting how an old tool is now being used as a query tool and a reporting tool that can be, so we shouldn't be throwing away old tools. We should be looking for good applications. And what I think what Martin has showed here is absolutely brilliant in terms of the ability to demonstrate how to mix technologies from different eras together to give you some insights, because that's what supply chain management's all about.
It's about insights, getting these insights that we need to be able to manage our business. We have at Caltech, where I lecture quite frequently, we have a great professor, Dr. George Djorgovski. He's a big data guy.
He studies trillions of data elements coming from black holes, and he says what we need to look for, what's required to become an agile company, we have to not only connect the dots, but we have to connect the non-dots. We have to find those patterns, those things that are happening, and this is a great example of how one does that. So I appreciate you sharing this. I'd like to switch gears real quick and go back to, go back to the question of what are the, probably the most important technologies that we all need to learn in our supply chain, we need to learn and think about applications in the next, let's just say the next five years? Let's keep it to a relatively short horizon. We have about, less than 10 minutes, about eight minutes left. So let's just kind of do a rapid round here.
Maybe we start with Alex. - I think keeping the brain healthy to learn every day is the most important thing. I always say that, you know, gimme people that can think because the tools, the technology, as we saw, and like a simple Excel spreadsheet, you can do wonders with it. But personally, I think the artificial intelligence is going to be one of the technologies just because of the predictive capabilities, the insights that can give us, artificial intelligence is going to be a key technology in the, it's already a key technology, but in the next five to 10 years, we will see more and more and more and more processes being left to artificial intelligence. - Okay, good, maybe Shawn, you wanna jump in, your idea? - Sure, you know, I think there are multiple disciplines within the technology that power the supply chain, and any single one for them, if you master them, you can get that, you can get into the door.
And so I wanna make an offer to especially the students that you don't have a necessarily chase one single thing. I'm gonna talk about four different things that any one for us can be tremendously powerful. Number one, like basics, software engineering, right. Just write really good code. You know, and data engineering, which is actually a different discipline.
It's about scalability of data, big data for you And then there's another discipline, which a data science. Now we call it, machine learning AI, to me, it's part of data science, all about statistics, analytics and data science. So that one discipline's super important. And then IoT and automation. To me, that's one discipline in the sense, like, you know, you start to deal with the machines.
You deal with, you know, the operational operating systems versus the information systems. So those four different, any single one of them can absolutely launch your career and then become super successful. - Well, that's a, you know, so if you go back 20 years ago, the advice would've been, you know, how to implement ERP systems and things like that, and you're talking about a whole different skill set, aren't you, and that's how fast the world changes around us. And globalization is here to stay. Globalization is not going to change. It's gonna get more intense.
Competition's gonna get more intense. So I think we heard from Shawn, I think we've heard some real good wisdom about where we need to be thinking. We need to, in a sense, we need to be thinking in a non-linear sort of way. Now we need to be thinking differently in this complex world.
Martin, do you have a comment on these technologies for the next five years? - Yeah, I think some of the points that were already made were very valid and I think we're pretty much in agreement on most of those issues, that it's really trying to pick out the right tools and applying it to the right situation or the right business problem that you're trying to solve. The one thing I will try to add is that, you know, we look down on technology to solve problems, but a lot of the issues that we're facing, we have to look up through the organization and trying to get senior management on board. I heard Alex mention about a tried and trained CEO, and I don't think that they really always understand what their role is of defining, you know, how we automate our business processes. And what we have to do is engage them into what kinds of questions there are. So the other talent, I guess, that was not mentioned is how to do communication upwards through the organization so that they understand, you know, what value these technologies bring to the organization, but also what their role is of defining what the business objectives are and not just have scope creep, they just want a little bit of everything.
Everything has to be prioritized. Everything has to be focused if you're going to try to answer any one specific question. So a large part of the challenge for people who are involved in the technology area, particularly in supply chain and in finance, is how to present and get the management, upper management engaged in this w
2023-10-31