Kenco releases supply chain innovation blueprint

Chattanooga Tennessee-based 3PL Kenco recently hosted a roundtable of supply chain leaders from companies including Coca-Cola, Chevron Technologies, Georgia-Pacific, Kids II, and Sealed Air. The open-ended discussion produced four key themes, outlining a blueprint for companies looking to drive meaningful supply chain innovation.

According to the blueprint, successful supply chain innovation will only happen when the following actions occur within an organization:

• Stop thinking of “innovation” only as adopting emerging technology – and get the C-Suite thinking this way too.
• Break down silos across the organization. Innovation and success can only happen when there is collaboration with peers.
• Move beyond a fixation on cost; without risk, there is no return.
• Realize trying to become more like Amazon is not the best strategy.

Kristi Montgomery, vice president of innovation for Kenco, attended the roundtable and details the four themes in the blueprint, which cites industry research, real-world examples and practical steps to move forward.

“Members of the roundtable recognized that as supply chain leaders, we have the power to influence and transform the way innovation is developed, nurtured and implemented in our industry,” Montgomery said. “The future of the supply chain is based on collaboration, connectivity and agility, and most important, being resilient.”

Among the sentiments expressed in the roundtable, Montgomery said, is a current lack of cooperation between procurement, sales and marketing, and operations.

“They see it as well and understand it’s a huge barrier,” she added.

Traditionally, customers have largely approached third-party logistics providers (3PLs) like Kenco for only supply chain services. Lately, they are increasingly asking for help overcoming the collaboration barriers within their organization.

“The more a 3PL partner can understand the challenges, the better positioned they will be to offer help,” Montgomery said. “When you make a packaging change, for example, it’s important to know the impact down the supply chain.”

Montgomery said the roundtable included a few companies that are aggressively innovating with an eye toward transformational change, whereas most are looking for incremental change.

“Some of our customers look for a moonshot, the one big idea that will propel their business into the stratosphere,” she said. “But more often they’re looking for the one idea that will give some improvement.”

Whether thinking big or small, each company recognizes the size of the challenge facing the industry.

“Consumer immediacy is driving a different thought process in how they run their businesses,” she said. “A shopping mall is not going to be how people shop in the future. These companies are weeding their way through that and thinking about how to meet those challenges.”

The goal is to cost-effectively give the consumer what they want, Montgomery said. Since the supply chain is not usually the money-maker in an organization, it’s no small task to add that value. In addition to collaboration within the organization, companies will want to make sure their current investments communicate well with future ones.

“We see innovation as a continuum, with incremental on one end and the moonshot on the other. In between, there’s a whole lot of value to be gained,” she said. “It’s about utilizing technology in such a way as to improve processes. From my perspective, solutions in the market like big data, robotics, IoT, and the other buzzwords – none of them are cheap. But in the short term, customers can ask if there is enough collaboration and communication between these tools that they can use them for years, because in three years you might be looking for the next big thing.”