In the last three years, companies and their supply chains have been confronted with extreme challenges and previously unknown situations due to the Coronavirus pandemic, the outbreak of the Ukraine war, and climate change-related natural disasters, among other things. In the face of these globally impactful risk outbreaks, the importance of the topic of supply chain risk management is growing and has now become a top priority for 58% of the companies.

This is just one of the findings resulting from Miebach Consulting's second edition of the global market survey on the relevance and success factors of supply chain risk management with nearly 300 participating companies. Other findings of the study are:

“Supply chains are 40% more likely to be affected by disruptions than in 2019, and the disruptions that do occur result in more dramatic impacts. Accordingly, the demands for risk mitigation, flexibility, and resilience in supply chains are increasing. This is where supply chain risk management can make an important contribution,” says Tim Wagner, Consultant at Miebach.

Depending on the severity of the disruption, participating companies experienced financial losses averaging between 0.6% to a peak of 4% of annual sales last year. The most common consequences of the disruptions included delivery delays, blocked delivery routes, and rising transport costs.

About 50% of respondents with supply chain risk management in place were able to mitigate the impact of the top risks. In doing so, 68% of companies were able to bypass blocked supply routes, thereby maintaining their procurement or distribution flows and minimizing the impact. The negative effects of delivery delays were reduced by as many as 80% of companies.

94% of companies have established a process for supply chain risk management, but fewer than one in five include the entire supply chain in the process. Low system-side support (51% without a system) ensures that the benefits of a supply chain risk management process are not fully realized.

Three-quarters of respondents want to continue investing in supply chain risk management in the future. The focus is on optimizing the process as a whole.

In strengthening resilience, companies are focusing on redundancies in inventory or procurement (dual/multi-sourcing) in the short term - structural changes in the supply chain are planned for the long term, such as nearshoring.

“If the past few years have taught one thing, it is that supply chain risk management is essential for companies to navigate safely through difficult times and secure competitive advantages in the long term,” sums up Daniel Simon, Senior Consultant, Miebach Consulting.

The complete report of the study results in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Companies in all industries, from time to time, find themselves in the need to bid for product or services. This can happen for a variety of reasons such as, their current contracts are about to expire or the business is expanding into new geographies. EU-based companies which have their operations to the UK affected due to new regulations imposed after Brexit, prefer to tender for a new warehouse in this nation instead of doing the operation themselves.

That said, you may have reasons or be tempted to handle tender projects internally. Confidentiality, total control over the process and knowledge retention are the main reasons, in addition to the fact that the recent increase in global prices has pushed smaller and more vulnerable companies to seek to cut costs as much as possible.

However, getting external support with the project by hiring a specialised consulting firm to run your tender project has advantages that far outweigh the drawbacks.

Read more about this topic in the Miebach Whitepaper by Cesar Rodriguez and Richard Nachar "10 reasons to run you tender project with external support".

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The rapid growth of e-commerce, the on-demand economy, and the associated surge in shipments, are escalating traffic and environmental pollution in cities. This reinforces the need for new and effective urban logistics concepts, not to mention ever-increasing customer demands, service improvements required to satisfy these demands, the desire for flexibility, and the growing importance of sustainability for companies and their value creation.

Read the full article in the ULaaDS website 

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Supply Chain Assessment: Starting Points for Holistic Cost Optimization in the Chemical Industry

Due to the current very challenging economic and geopolitical situation, cost-cutting measures seem unavoidable for many companies. The German chemical industry is also feeling the massive headwind and is preparing for the onset of the downturn with cost-cutting programs, some of which are worth millions. But which measures make sense? Which will have a lasting effect and not just postpone necessary investments for the future?

CHEManager asked Klaus-Peter Jung, Partner and Head of Industry for the Chemical Industry, Beverages and Logistics Service Providers at the Miebach Consulting Group, about a possible solution, the Supply Chain Assessment. The questions were asked by Birgit Megges.

Source: © CHEManager International, Wiley-VCH GmbH

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The German Supply Chain Due Diligence Act, which became effective on January 1, 2023, is currently stirring up controversy. Supporters see the regulation primarily as a necessary instrument to motivate companies to act more sustainably and make improvements in terms of human rights, working conditions, fair pay, etc. Others argue that the legislation will not bring about any noticeable changes in society and will also lead to high bureaucratic hurdles for companies. 

What do German companies think of the new legislation and are they sufficiently prepared for it? To address these questions, Miebach Consulting, in collaboration with GS1 Germany, conducted a study with nearly 500 participants in the summer of 2022 to determine the attitude of German businesses toward the upcoming regulations, as well as what measures have already been taken or are planned. 

The free report on the results of the study in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Miebach Consulting improves efficiency and quality using Tecnomatix Plant Simulation – 7 case study scenarios

Dr. Jens Zimmermann, Principal at Miebach, and Markus Nadj, Consultant at Miebach, presented several Pharma case studies at Realize LIVE, Siemens’ global customer event. They span the entire Pharma value chain and reflect the potential improvements that can be achieved by creating a digital twin of the physical system.

Miebach has chosen Plant Simulation in the Tecnomatix® portfolio of digital manufacturing software from Siemens as their standard tool to work with their clients in this space. They site Plant Simulation’s flexibility, object orientation, library concept, and data handling as key advantages over other alternatives.

Link to the article

Source: Siemens

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Companies want to use new concepts for urban logistics in the future. The new trend study on the topic of "Urban Logistics" by Miebach Consulting in cooperation with the global real estate advisor JLL and the Research Lab Urban Transport (ReLUT) of the Frankfurt University of Applied Sciences shows that companies are rethinking their delivery concepts to cities and want to break new ground.

The free report on the results of the Miebach Urban Logistics Study in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Large-scale projects in pharmaceutical logistics are complex, longterm and investment-intensive projects that can only be successfully implemented with an assertive and goal-oriented large-scale project organization structure. The installation of a powerful overall project management, consisting of the comprehensive project management (PM) and a supplementary project management office (PMO), is critical to success.

Overall project management requires both specialist logistics expertise and specific management skills.

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The past few years have flooded global supply chains with problems such as product shortages, price spikes, and port congestion. Whether the crisis is related to weather, lingering pandemic issues, or land war in Europe, the way that companies respond to challenges has been significantly compressed. What used to be strategic planning has given way to risk and contingency planning. 

The ongoing digitalization of supply chain data has enabled a transformation in the way decisions are made - and will be a key differentiator for those companies who can be agile and flexible in their responses to disruptions. Nick Banich, Chief Revenue Officer at Miebach USA, provides insight into how leaders can adapt to the changing landscape of supply chain and logistics in this publication produced in conjunction with SupplyChainBrain. 

About SupplyChainBrain  SupplyChainBrain, today’s most comprehensive supply chain management information resource, is accessed year round through a wide range of ever evolving multi-media formats by hundreds of thousands of the world’s most influential supply chain executives. In addition to addressing the fundamental principles of supply-chain management, SupplyChainBrain identifies the latest news, emerging trends, technologies and best practices, forward thinking ideas and cutting-edge solutions - and continues to write and report about these as they evolve and mature. Visit https://www.supplychainbrain.com/ to read more. 

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For some time now, the "Project Management Office" (PMO) has established itself in Supply Chain Engineering alongside the classic project management approaches.

Great potential benefits for large-scale project implementation lie in the planning and implementation of a PMO, as both administrative and management-related gaps are closed with the goal-oriented project management. Success has two letters: Do. Major project management with PMO leads to your implementation success!

Read more about this topic in the Miebach Whitepaper by Ole Grasedyck "No way around PMO".

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The need to establish such complex supply chains with central and regional warehouses has been reinforced by several trends in recent times. But which article should be placed in which warehouse? A holistic approach to article allocation helps here - and can unlock enormous cost optimization potential.

Read more about this topic in the Miebach Whitepaper by Christian Lütkemeyer and Ole Grasedyck: "Where to put the stocks?".

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What a boring topic: what is the optimum pallet height? But if you take a closer look, it is quite exciting. Why is that? Because this topic has direct potential for cost and CO² savings.

Read more about this topic in the Miebach Whitepaper by Dr. Niels Linge und Heiko Hitzhuber: „Pallet heights in logistics“.

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A case study by Miebach Consulting & Binzagr Company

Miebach Consulting supported Binzagr Company as the designer and project manager for the design to realization of their world-class distribution center in the King Abdullah Economic City.

Binzagr Company is one of the largest and leading distributors in Saudi Arabia and the GCC that recently completed a unique milestone of over 140 years of continued service. The distribution business forms the foundation of Binzagr Company, which can trace its history back to its start in 1881, trading on the ancient routes between Europe and The East.

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Supply chain digitization is imperative for companies who want to stay competitive in the marketplace. Experts state that 80% of supply chain costs are locked in within the design of the supply chain, so focusing on that area is paramount to running cost-efficient supply chains.

Leading companies have adopted modeling and simulation technologies, leveraging a digital twin of their respective supply chains, allowing them to unlock benefits that otherwise would have been locked in by design. While adopting new digital supply chain technology results in dramatic efficiencies within operations and logistics, it demands supply chain practitioners have specialized skills. This is where we encounter the skills gap.

One way to address how to overcome the skills gap is in the context of a maturity model. Understanding where your organization lies within the maturing model allows you to enable and augment internal capabilities, thus accelerating the journey.

Join Miebach and Coupa as we discuss the approach, best practices, and technology that can enable you to overcome the skills gap. A special guest from Eaton Corporation will share her experiences with Miebach and Coupa as we worked together to develop their in-house supply chain analytics expertise.

We'll discuss ideas and practical examples for addressing the skills gaps within:

• Project Initiation - People, product, process
• Skill Development - Hiring, Coaching, Training, Developing, and Shadowing
• Maturity - Anchoring the Organization and Developing a Center of Excellence

Please fill out the form to receive a link to the webinar recording on-demand.

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Dirk Falkenreck, European DC Manager, Parker Hannifin shares how Miebach helped increase efficiency, improve customer service and create a 2025 vision.

Read more about this topic in the Parker Hannifin case study.

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How cross-industry practices could benefit the developing supply chain

Logistics professionals understand the importance of shaping the right supply chain for both the right product and demand. But what is the right supply chain for cannabis? Prior to 2018 no legal examples of largescale cannabis supply chains, much less documented patterns of legal market demand, existed. Legal cannabis is a relatively new industry but faces multiple supply chain challenges. These challenges, such as how to adapt to regulations, fulfill demanding customer expectations, optimize their supply chain networks, and reduce product variability, have significant supply chain consequences. Fortunately, these challenges are shared among four prominent and mature industries: Pharmaceutical, Fast-Moving Consumer Goods (FMCG), Alcohol and Tobacco, and Agriculture.

Miebach Consulting has collaborated with clients on supply chain projects and engagements related to these challenges in each of the four industries. This experience and expertise uniquely positions Miebach to create value for clients within the cannabis industry and enhance their supply chain operations. This publication offers a perspective of how the pharmaceutical, FMCG, alcohol and tobacco, and agriculture supply chains relate to cannabis, and which best practices cannabis companies could implement from each.

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Even before the Corona pandemic, supply chains were disrupted by emerging risks and the consequences were often severe. Risks can occur in the form of various types of costs, be it lost productivity, lost sales or inventory build-up, and at different points in the supply chain. Lack of visibility can be cited as a significant reason why disruptions can occur as a result of risk occurrence.

Read more about this topic in the Miebach Whitepaper by Daniel Simon: "Supply Chain Risk Profiling".

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Boosting Intralogistics Efficiency in the Pharmaceutical Area

The changes in customer needs and market requirements have not only been changing because of the pandemic influences within the last year, but traditional business models were quickly considered outdated in the current environment. The ones who have an adaptable warehouse and distribution concept are now pleased to react flexibly to the future needs. But what happens to those who struggle with outdated technical equipment, old IT systems, or even both?

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Today, supply chains are already considered by a large majority as essential tools for achieving business objectives, as they are elements that generate competitive advantages and provide differential values for companies. And as a consequence, they are given greater attention by Senior Management.

It goes without saying that this trend has been particularly exposed during the COVID-19 pandemic: in the face of a totally unexpected and unprecedented situation in which there have been very abrupt changes in market behavior, only well-prepared supply chains have been able to respond adequately, cushioning the impact of the crisis or even, in some cases, taking advantage of it.

These more advanced supply chains have stood out for responding with greater agility, for having superior reliability in stock availability, for meeting delivery dates, and for their ability to better control operating costs. One of the key aspects that has allowed them to achieve these results has been the visibility of the operations within the supply chain, and in this sense the companies that had implemented "Control Tower" tools have had a substantial advantage to exploit with respect to the rest.

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The corona pandemic has disrupted many industries, and companies are still adapting to various shifts in consumer habit as well as product availability. The results of the study performed in Q4 2020 indicate that a number of initiatives are being considered to streamline operations within warehouses and DCs to adapt to these changes efficiently.

Although there is no single task that will transform a struggling operation, according to Felix Vicknair, Director, Miebach Consulting Inc, companies should not give up: "The most common initiatives currently in progress overwhelmingly pertain to that of operations management and operational processes; simply stated, although not so simply perfected, pursuits of improving the way in which operational execution is managed and performed.”

These are the results of the DC Efficiency study by Miebach Consulting. In mid-2020, the international supply chain consultancy examined which strategies and measures companies are focusing on to improve efficiency within their 4-walls, and how those priorities have shifted since the advent of COVID-19.

85 companies took part in the global online study, including an unusually high proportion of C-suite and Director level participants(15 and 35% respectively), which indicates the importance and strategic significance of the topic.

Most-immediate improvement efforts focused on operations management and processes

Top Priority was defined as “having our immediate attention - currently mobilizing resources for it” – the largest areas being Process Accuracy (52%), Health, Safety, and Environment (51%) and Warehouse Management System (50%). The lowest categories in contrast were in regard to higher budget and newer technology, such as CAPEX projects, Digital Twin for warehouse operations, and Complete picking automation.

Responding to demand and channel changes is important to supply chain leaders

When looking at the largest priority shifts, two trends stand out: operations are considering how to accommodate the effects of demand & channel shifts, and managing those operations is more relevant than ever before. Operational leaders are most concerned with accounting for e-commerce growth, enabling omni-channel fulfillment, or correctly prioritizing their customers and channels.

All categories reported an increase in urgency

The increase in prioritization of all focus areas shows there is still focus and potential improvement across all facets of an operation. The common saying of "a chain is only as strong as its weakest link" is certainly applicable for DC operations and is represented in the data.

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In times of Corona, means of transport beyond public transportation and private vehicles that allow social distancing are booming. The clear winners of the crisis in this context are the caravanning and bicycle industries, which are now receiving an additional boost in addition to the already good medium to long-term growth forecasts. In our Miebach Consulting Bicycle and Caravan Report 01/2021, current developments in both sectors are described.

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Production and logistics are undergoing a transformation caused by increasing digitalization.

• Will this overturn the achieved improvements performed by lean methodology?
• Will industry 4.0 replace lean?

Read more about this in the Miebach Whitepaper by Dr. Reiner Friedland: "Industry 4.0 - the replacement of lean?"

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The new normal has brought about drastic changes in the supply chain: supply disruptions, different consumption patterns than usual, unexpected growth in e-commerce, pressure to respond more quickly to demand volatility, and last but not least, pressure to cut costs, among many other things.

The positive side of the situation is that companies have realized the importance of the role of the supply chain within the organization: today there is more awareness of how crucial it is to have a robust and efficient digitized supply chain to be able to better respond to business changes.

Outdated manual data processes have their days numbered, and this dynamic should be harnessed by supply chain leaders to push their supply chain to the next level. Taking a quote from "The Art of War" by Sun Tzu, "Where there is chaos, there is also opportunity."

Download this whitepaper to learn how to get the most out of your supply chain using artificial intelligence and digital twins.

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The advancement of the supply chain is linked to the incorporation of new technologies, and the implementation of blockchain in this area can be the solution to many current problems, as it gives visibility and innovation to business processes.

If you work together with all the agents within the supply chain, it is possible to start seeing the great benefits, impact and opportunities that the implementation of blockchain can have.

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Even though the corona pandemic has pushed many future topics and plans into the background, companies are working on initiatives for greater sustainability. The results of the study suggest that a successful turnaround towards sustainability can be achieved if consumers first rethink and transform this new way of thinking into action and demand.

Nevertheless, according to Thorsten Gensmer, Director, Miebach Consulting GmbH, companies should not sit back: "Those who think ahead now and lay the foundation for sustainable business activities can profit greatly from the newly developing market. Collective actions with a complete cradle-to-cradle approach are necessary for greater climate protection goals in the supply chain. The high level of planned initiatives shows that this can already be worthwhile now!

These are the results of the current sustainability study by Miebach Consulting. In mid-2020, the international supply chain consultancy examined which strategies and measures companies are taking to make supply chains sustainable - and to what extent sustainability and corporate goals can be combined.

277 companies took part in the global online study, including an unusually high proportion of managing directors (18%), which illustrates the importance and strategic significance of the topic.

The motivation for sustainability is tied to the idea of efficiency and cost reduction

With regard to the most recent and the next planned initiative, the majority of respondents cited an improvement in efficiency with an average of 14%, or a cost reduction with an average of 15% as motivation. This is followed by topics such as CO2 reduction (7%), green packaging or the reduction of plastics in general (7%). Sustainable measures based on ecological or social motivation, such as employee health and safety (1%) or environmental protection (1%), are rarely mentioned.

Sustainability in supply chain management is gaining in importance

The surveyed companies have implemented an average of 16 sustainability initiatives in their companies. For the future, however, the surveyed companies plan to almost double (+97%) the number of sustainable initiatives already implemented within the next few years. This suggests that sustainability in supply chain management will gain in importance.

High resource input and complexity discourage

In general, sustainable initiatives are considered less attractive if they require a high level of resource input, such as the development of reverse logistics, which is rated at just 4.2 out of 10 points. Even already complex topics, such as network planning, which is rated 4.6, are perceived as less important. Therefore, resource-saving and relatively simple measures are generally preferred.

The free report on the results of the Miebach study "Sustainable Supply Chain Management" in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Due to increasing disruptive events like COVID-19, it is becoming more and more difficult to control supplychains successfully. The interaction with different suppliers, production, and distribution sites as well as customers increases the complexity.

This is why in an age of digitalization and far-reaching market-related and social changes in the logistics IT architectures of the companies, transport management systems (TMS) are becoming increasingly important as a central software component for supply chain management. These systems not only ensure efficiency, but also fulfill the increasingly important function of an integrator between the involved supply chain partners. TMS are therefore an essential component for an overview of the flow of goods and the implementation of integrated logistics strategies.

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COVID-19 has raised the need in the entire supply chain, and particularly in warehouses, to be proactive and well prepared for unexpected situations with peaks and valleys to be able to adapt, grab opportunities, and lead the market.

Interviewing, observing, and gathering data helps you in identifying the gaps and in setting the right action plan to optimize your layout, improve process, fully utilize your employees, and decrease the operational costs.

Miebach Consulting has the answers on how you can start making your warehouse more future-ready.

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Businesses have been preparing their supply chain in readiness for Brexit, however many have had their plans disrupted by the Coronavirus which has highlighted some of their supply chain shortfalls and diverted their effort from Brexit planning onto more pressing issues. 

Whatever the eventual outcome of Brexit, business should see the uncertain future as a prompt to rethink their supply chain strategies and build greater flexibility, resilience, and structural agility into their supply chains. 

From Miebach’s perspective there are 5 key topics to future proof your supply chain strategy and become “Brexit ready”. 

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In cooperation with the logistics newspaper “Deutsche Verkehrs-Zeitung” (DVZ) Miebach Consulting conducted the eighth edition of an outsourcing study for logistics experts from industry, trade and service providers. The top focus of this year's survey has been the topic personnel. More than 360 shippers and 170 logistics service providers from Europe, Central and South America took part in the study.

Central results of the success factors and trends in logistics outsourcing 2020 are:

Employee recruitment and qualification are confirmed as success factors. 97 % of German logistics service providers consider employee recruitment, qualification and retention to be the decisive success factors, another 87 % expect that the concept of employee recruitment in the context of an award decision will gain in importance and only 17 % follow the statement that employee recruitment and qualification will lose in importance for logistics service providers due to higher automation and digitalization.

The assessment of both German and international shippers regarding the outsourcing suitability of various logistics functions is clear: outsourcing continues to be dominated by classic transport and warehousing services. This is also confirmed by the assessment of logistics service providers. The clear dominance of classic transport and warehousing processes is also reflected in the question of which functions companies plan to outsource in the future. While around two-thirds say that they have already outsourced transport completely and that there is therefore less future potential, the greatest outsourcing potential is found in the area of warehousing and order picking.

For the first time, the importance of the selection criteria between storage and transport services differs and regional differences in the importance of the individual criteria are also increasing.
A slight increase in insourcing is also evident. 24 % of shippers respond that they are planning insourcing for the future - in addition to classic warehouse processes, now also in returns processing and transport planning.

The future of outsourcing is viewed much more critically in Germany than 3 years ago. Among both shippers and service providers, the proportion of those who expect a further increase in outsourcing has fallen significantly - in favour of those who expect a stable proportion.

"Future growth in outsourcing will take place primarily outside Germany. This is a development that we have been observing for some time. For example, the total outsourcing volume in Germany has tended to grow in terms of price and volume in recent years, while genuine new business in logistics outsourcing is becoming increasingly rare. " - says Dr. Klaus-Peter Jung, Miebach Consulting.

The complete study report in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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In our "Supply Chain Check" we are following the 80:20 rule, focusing on the most business-relevant supply chain structures first. From supplier via manufacturing and warehouse sites to customers - we evaluate the level of oversize, the match of locations to markets, service levels to customer needs as well as required stock levels - assessing costs and performance, weaknesses and saving potentials.

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Applicable methodologies exist to define and implement different types of strategies along the value chain, helping to identify challenges as well as establishing a work plan.

These strategies, which help to transform a vision into reality, include the following aspects:

• Value chain Management
• Risk Management
• Change Management
• Digital Transformation
• Carbon Footprint
• Cross-cutting KPIs and impact on ROI
• Integration strategies, collaboration with suppliers and customers

Miebach Consulting has been successfully transforming value chains globally for nearly 50 years. Contact us if you want to discuss how to align your value chain.

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The current crisis requires an immediate response to reduce operating costs and focus on the post COVID-19 era.

Can productivity and space efficiency be improved? How can the warehouse throughput time be reduced? Is it possible to increase throughput or improve quality in an established structure?

This white paper provides an insight into how potential improvements can be identified, quickly and robustly by a logistics audit and how the necessary short and medium-term implementation steps can be planned and prepared.

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Managing supply chain risks has received increased attention in recent years, aiming to shield supply chains from disruptions by predicting their occurrence and mitigating their adverse effects. COVID-19 showed us how vulnerable current supply chains are. Artificial Intelligence (AI) offers huge benefits to supply chain managers, but only if it is based on solid fundamentals that take into account the diverse and dynamic nature of today’s modern supply chains. 

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Can Digital Transformation, Big Data, Artificial Intelligence, Internet of Things and Robotics be the answer to some of the main Supply Chain challenges? How relevant are these technologies in the short, medium and long term?

The complete report on the results of the Miebach Pharma & Life Science Study 2020 can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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What accounts for a good crisis communication? The Corona crisis will pass...

... and then you need your employees - healthy and highly motivated to master the coming challenges together. Either your company could move into restructuring mode or being faced to a sudden upturn in business. Your employees (and the Management too) will be expected to have a lot of recovery work (today and tomorrow).

Therefore, protect the motivation and commitment of your employees and always make sure that there is good communication in both directions. Be aware of the reservations and fears of your employees and deal with them proactively.

Have a look in the Miebach whitepaper compact where we share 9 tips for crisis communication with you.

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Also before COVID-19 almost all OEM and international automotive suppliers (tier1, tier2 and tier3) are faced with a significant drop in sales and profitability. What we observe as a possible reason is a major disruption in this industry - boosted by the current move of the OEMs towards electric cars/e-mobility and changes in customer perception of mobility. How can automotive suppliers optimize their supply chain according to their necessary strategic and operational turnaround? 

Automotive supply chain improvements in three steps:

Step 1: Getting full transparency: Miebach ensures full transparency for a strategic self-assessment

Step 2: Streamlining the set-up: Miebach streamlines the current set-up for the first turnaround steps

Step 3: Planning the new blueprint: Miebach plans a reliable and realistic future blueprint

Miebach Consultants have been successfully designing automotive supply chains for 47 years. We have extensive experience with operational issues in the automotive industry.

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In global economy appear natural cycles of growth and regression. Some of them are regional in nature, some of them impact economies on global scale. Unfortunately, in addition to this sinusoidal boom and stagnation cycle, we encounter unpredictable and violent phenomena in our life, with significant effects on economic environment. The American economist N.N. Taleb has called such phenomena as "Black Swans". We know such Black Swans from our recent history: the outbreaks of world wars, the September 11th attack, the collapse of Lehman Brothers bank. We know them from today's news too: it is a world COVID-19 pandemic. A spanner is put in the works of rushing economic locomotive, causing strong slow down. However, as we struggle with the effects of this brake, we are already thinking about what we can expect in the future and how the supply chains will look like, when the economy starts to gain momentum again. Just as the human body becomes more resilient to the disease after it has passed, so do individual actors of economic scene, are taking preventive actions, which can be observed in a macroscale as trends to make the economy more resilient to the famous Black Swans.

So how shall the supply chains look like in one-year or five-year horizon? Let's start from the near future considerations. Economists are predicting two possible scenarios: V-shaped one, with rapid deceleration and fast growth after the crisis, or U-shaped one, where gaining growth requires more time and is preceded by stagnation. U-shaped scenario is considered as more probable. Following previous example of a heavy steam locomotive with a lot of wagons, it is rather unlikely that it will start immediately at full speed, even if we try to heat the boiler as fast as possible, providing different forms of economic aid or mobilization measures.

The pandemic wave is sweeping through the world, reaching its peak in Europe and the USA, going into the descent phase in China. A lot of companies are already taking preventive actions. An example from the hi-tech sector: Apple announced production diversification with partial relocation from China to India, Taiwan and Vietnam. The automotive industry is also particularly affected by COVID-19. China is now one of the world's largest markets for new cars and an important location for OEM, 1. Tier and 2. Tier suppliers (China is one of the largest exporters of automotive components). Some manufacturers have postponed the start of production in their factories in China because of the

pandemic. Production and transport as well, are severely restricted due to border controls, closures and lockdowns or quarantines affecting factories, airports and seaports. Air transport capacity is strongly limited or only available at premium price. Consequently, some companies are facing a lack of supply of raw materials and semi-products, causing production stops worldwide and affecting global chains. Demand in Europe and the USA has fallen dramatically, but there are already some signs of recovery in China. Andreas Renschler, head of VW's commercial vehicle division, said in an interview with "Wirtschaftswoche" on April 3. "There are already orders for Scania trucks in China that we can't handle at the moment because we had to stop production temporarily”. Conclusion? In the short term, we still have to deal with production and transport obstacles that need to be taken into account to update agreed delivery times - both for new contracts and for those already signed.

Regardless of the current problems, we should already start thinking about the future. The investment cycle of the new logistics facility, from concept to commissioning, is about 2 years, and due to the current problems mentioned above it may be even longer. This means that facility designed today will start operation already after the worst time of stagnation resulted from COVID-19. So whoever dares to take investment decisions today (revising of course the growth forecasts for the coming years) will be one step ahead of the competition tomorrow. John Allen, President of the Brookings Institution, a retired U.S. Marine Corps General and former commander of the U.S. forces in Afghanistan, in his analysis for Foreign Policy said briefly: "The story after COVID-19 will be written by the victors".

So how do you become such victor? Let us try to look ahead and imagine possible lessons learned from the experience of COVID-19 and impact on supply chains in longer time horizon, e.g. five years. Some basic assumptions of global production may be questioned. Global, widely spread supply chains, with millions of components transported across the planet, may not survive in their current form. The role of local production and strategic stocks stored locally may increase. German futurologist Matthias Horx states: "The global system is drifting towards "Glocalization”. Companies will start to rebuild and reduce the multi-stage, multinational supply chains that dominate production today." Global supply chains have been put under pressure already before the pandemic - due to rising labor costs in China, President Trump's trade war, or progress in robotics, automation or 3D printing. COVID-19 can accelerate this process of change by breaking the links in supply chains already today. In the post-pandemic reality, we can witness the birth of new models of cooperation (e.g. sharing of human resources, already implemented by Aldi and McDonalds in Germany), new legal requirements (e.g. national reserves and contingency plans for strategic industries). Profitability of supply chains may consequently decrease, but supply stability should increase.

So, what could be recommended? First, not to freeze, but to carefully continue with investment plans. Second, to implement three-stage risk management: 1) identify risks, 2) implement short-term actions, 3) develop a long-term risk mitigation plan.

Further considerations about pandemic related risk management you may find in Miebach white paper "Supply Chain Risk Management. How can companies avoid a coronavirus supply chain drama?" by Dirk Friebel: Miebach Whitepaper compact SC Risk Management Corona Virus.

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The crisis has hit society and companies head-on, unprepared and with full force. Waste no time anymore and react immediately.

We recommend setting up a so-called “Focus room“ to monitor the developments in virus spread, official decisions and social media and to control supply chain focus areas on the basis of KPIs.

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You are a manager or business leader in the field of supply chain and logistics. You have already experienced the first effects of the Corona-outbreak such as

• Delays in shipments and longer inbound lead times
• Cancelled shipments of goods that are sourced from heavily impacted areas
• Additional paperwork to document the safety of your goods for certain export destinations
• Increased demand for certain goods triggered by panic buying

But that is only the beginning

• It will also come to your work-floor.
• It will also affect your people.

With everything you have been reading, you are wondering which decisions and actions you need to take. We will make a simple and clear recommendation, based on the latest available scientific data.

So, this is a call for action. There are simple measures that will make a life-saving impact. The earlier you impose heavy measures, the less time you need to keep them, the easier and quicker it will be to recover to steady operations. 

The Miebach team wishes you all the best and a clear mind for your decision-taking in these challenging times!

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Digital Twin for dynamic adaptations and optimizations

The complexity of logistics systems is a constant and ongoing challenge in supply chain management. Planning by means of simulation is an integrated approach to secure important decisions in the design of highly dynamic plants and networks. The implementation of a digital twin has become a key technology in the course of digitalizing the supply chain.

Thus, the digital twin enhances the spectrum of simulation by linking real, sensor-based data with the physical asset. The data generated not only supports process managers throughout the planning and implementation phase, but also enables dynamic adjustments and optimization in operations.

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Today’s B2B and B2C purchasing habits and market dynamics are forcing companies to make major changes to their supply chains, since traditional management models clearly neglect the variety of transparent information to which omnichannel customers are accustomed to.

In this article, Pank Bedaux, Partner at Miebach Consulting, reflects on how the supply chain has developed and on how the digitalisation changes still pending should be tackled.

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In day-to-day consulting, there are two main drivers for logistics optimization projects: Cost saving and service improvement. As a rule, the optimum solution is somewhere between these two requirements. It is worthwhile to consider the internal logistics as well as at the logistics chain outside the facility. What optimization measures can be implemented and where is the greatest potential for savings?

To give an overview of possible approaches, you will find some suggestions in this whitepaper.

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Costs for Artificial Intelligence (AI) have dropped in the last decades. With the current computer technology, available methods (including: source code) and the various data sets available

in companies and public/social plattforms, almost every company could apply AI to achieve a benefit. Prediction (= AI) is applied in more and more applications – from traditional stock
management and sales forecast to all corners of your life – from sleep quality monitoring to heartrate data collection and analysis with your fitness tracking watch.

Artificial intelligence doesn‘t really bring intelligence as long as AI is not in the deciding role – but it is a quantum leap in prediction methodologies fighting uncertainty in all processes. 

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We as Miebach Consultants are often asked to analyze Supply Chains as part of Operational Due Diligence in M&A projects. We have systematically analyzed P&Ls for over 45 years and what we see is a growing importance of supply chains which today are generating more than 50 % of overall costs. For financing companies like private equity funds it is therefore quite important to get a quick and accurate view on these costs.

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How can companies optimize their supply chains for corporate recovery? A strategic restructuring plan defining future supplier structures, products, services, sales plans and geographical footprints is necessary. The "Greenfield" approach of Miebach Consulting leads to an optimal supply chain setup - working perfectly as clear direction for the next years. 

To bring it to real life and to realize direct savings, a step-by-step implementation plan for the transformation needs to be developed - always balancing the trade-off of cost savings vs. investments, restructuring cost / one-offs.

Read more about Corporate Recovery in this Miebach whitepaper compact. 

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A successful business year of a fashion company can be made by just one successful hit style (e.g. Shoes style). Existing / current trend identification approaches are often driven manually. Artificial intelligence (AI) and webcrawling will improve the fashion company’s hit-rate of innovations. 

Knowing the trendsetter and measuring / rating the influence of them (influencers, blogs, celebrities, brands) is the first step. Then permanent observations by web-crawling and a weighted evaluation leads to identification of new trends before the competition “wakes up”!

Physical Supply Chain Management Supply comes into game when the new products have to be brought to the market within short time (max. 2 weeks). At the end of the day nets ales and EBIT of the fashion company will be boosted. Artificial intelligence can make the fashion company innovate faster.

Miebach Consultants are successfully applying innovative approaches in supply chains since 45 years. Get in touch with us if you want to discuss your current challenges

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Global FMCG 2020 Study - Overview of trends and projects in pipeline for short term implementation

Changes in consumer behavior, blurring value chain roles and omnichannel trends, combined with the megatrend of digitization and the internet of things are putting pressure on supply chains today. What are relevant supply chain potentials for companies due to present and future changes in the worldwide market? Which concepts could be an enabler towards an agile, responsive, but also efficient and controllable supply chain today and in future? In the first quarter of 2019 Miebach Consulting, in collaboration with GS1 Germany, has conducted a global study in order to answer these questions and to evaluate the most relevant challenges and trends for supply chain organizations within the consumer goods industries.

The results of this global study will be presented to you in this report. The complete study report in English  can be requested free of charge using the form or by e-mail to Ellen Wood (wood@miebach.com) or GS1 Germany, Sarah Leick (sarah.leick@gs1.de), stating the contact details.

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Digitalization is disrupting outdated models while at the same time pushing and driving new business models. As long as goods are moved physically, logistics is the enabler of these new business models. Below you will find an overview of digitalization, platforms and artificial intelligence methods along the supply chain.

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Preview: Initial lessons learned from the global GS1 and Miebach study on the relevance and adoption of innovative solutions in FMCG                                        

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Do market changes require the restructuring of the supply chain?

Retail is changing. The influence of e-commerce has continued to grow in recent years. Companies from all sectors have to react to this and adapt their distribution structure. How do consumer goods companies meet market requirements in terms of logistics? Do they adapt the supply chain structure in order to (better) fulfill certain service goals, for example?

The benchmark study conducted by Miebach Consulting in the consumer goods industry, with a focus on the cosmetics industry, reflects the current state of distribution structures and provides insights into the development of networks and applied design principles. In addition, the results point to conversion processes in the coming years - and thus provide important information for the company's own supply chain planning.

Miebach surveyed 20 consumer goods companies of different sizes. The focus of the survey was on the network structure, the supply chain related Key Performance Indicators (KPI), the special requirements of each region, their degree of orientation towards e-commerce, and ownership. A further focus was on identifying the warehouse locations.

The complete study report in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Located 120 kilometers north of Jeddah in Saudi Arabia the King Abdullah Economic City (KAEC) is growing, adjacent to a fully equipped and functioning modern Port (King Abdullah Port – “KAP”) facility and with a future link to the rail network across the Kingdom.

According to the Kingdom’s “Vision 2030”, the new city on the Red Sea is planned to develop into a metropolis of 2 million inhabitants for the time after the oil era and serve as an economic center and logistics hub. A total of 100 billion US dollars has been estimated for the mega-project announced in 2005 by the former King Abdullah Bin Abdulaziz Al-Saud.

In the King Abdullah Economic City, a new distribution/logistics park, is being built for the Binzagr Company, which will also benefit from the port, rail infrastructure and the new regulations for the special economic zones.

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Unlike the planning of conventional warehouses, additional criteria must be considered for storage and material flow planning in pharmaceutical companies. All areas must be qualified from the very start of planning - including the areas of climate control, documentation of storage conditions (e.g. monitoring system), as well as entrance and access control, and particularly for material flow changes in the production area.

The following article examines the success factors for efficient and successful warehouse planning in climate-controlled areas for the pharmaceutical industry.

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The importance of company acquisitions is increasing among logistics service providers, but very few companies have created the organizational conditions to deal with the topic in a structured way. This conclusion is the result of a survey conducted in May and June of German financial investors and logistics service providers on mergers & acquisitions by the consulting firm Miebach Consulting in cooperation with DVZ.

"More and more companies recognize that M&A is a strategic tool for actively shaping growth opportunities. Nevertheless, it must be noted that there are only a few companies with an institutionalized M&A approach. If M&A is really to become part of the corporate strategy, the companies have to make significant progress" - says Dr. Klaus-Peter Jung, Member of the Management Board, Miebach Consulting.

The complete study report in German language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Just as there are varying levels of athletic and sporting activities in the US such as recreational, junior varsity, varsity, collegiate, and professional; so too are there levels of continuous improvement concepts, implementations, and cultures within our organizations. All-time great athletes such as Tom Brady, Mia Hamm, Michael Jordan, and Lisa Leslie didn't start their careers at the highest levels of their game. They began like many other professionals do: by starting off at either young ages or at beginner levels and growing their craft and skillset over time.

This isn't news to anyone, yet when we approach our own continuous improvement journeys within our companies, often we immediately jump into very complex projects such as implementation of a Kanban system, or rolling out a Toyota Production System (TPS) based initiative, introduction of six sigma projects, or a full-blown launch of a Total Quality Management (TQM) system, without first having built some of the very beginning levels of continuous improvement and coaching into our culture.

There are a few significant elements of continuous improvement that will help a novice manager buildup their "junior varsity team" into a more professional continuous improvement organization, and that is the focus of this whitepaper.

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Industry 4.0 – for companies there‘s just no escaping it. Some have tried going on the offensive, others have tried watching and waiting, and yet others have even tried rejection, but no one can ignore it.

The term “Industry 4.0” refers to the networking of people, systems, and objects in real time within self-organized and optimized value chains. With “Industry 4.0” having lost ist luster, the term “digitalization” is increasingly replacing it. Digitalization describes the transformation of analog processes to digital ones. Digital technologies are omnipresent: at work, at home, and on the go in purses and pants pockets. There’s more to digitalization that just digitalized photos or DVDs replacing VHS, though. The following pages offer insight into the world of opportunities opened up by the use of digital technologies in logistics and production.

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Great Britain is leaving the EU - at least that much has been decided. But how will Brexit affect logistics and supply chain management?

Europe will soon be a little bit smaller. No one is quite sure how this will play out yet. There will be consequences - that much is sure. What challenges will crop up in logistics and what should the people in charge be doing?

The entire political debate surrounding Great Britain's exit from the European Union has been plagued by uncertainty. In addition to the uncertain outcome of negotiations between Great Britain and the EU, the presumed aftermath of the negotiated terms also remains unclear. At the same time, less than a year remains to make vital decisions - and that's before implementation even starts.

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In a world where the purchases made online steadily increases and consumers are becoming more demanding in terms of speed and flexibility of service, the urban last mile distribution of goods is a service that gains more relevance every day within the supply chain.

However, national governments - and even more so the municipal administrations - have begun to take restrictive measures for delivery vehicles' access to urban centers, especially in major metropolitan areas, with the aim to avoid congestion and protect the environment.

The two trends are clearly conflicting and require a profound change in the urban distribution model. In this publication we will analyze which are the main challenges of the current model and which solutions are appearing on the horizon.

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The increasing competitive pressure, the improved technical possibilities due to digitization but also the need to make work easier for the employees both in logistics and at the point of sale as well as the partly limited availability of staff are the reasons why automation and robotics have been getting more attention in consumer goods retailing in recent years.

In summer 2017, the EHI Retail Institute carried out a survey on leading retail companies in German speaking countries to further explain the opportunities and challenges of the usage of robotics in retail - both in intralogistics and at the point of sale. The results are demonstrated in the EHI whitepaper (available in German language). Miebach Consulting supports this project within the "Robotics for Retail (R4R)" initative as a cooperation partner.

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With the technology dependency rapidly increasing in business activities and the customers demanding close to immediate responses; having a technical disruption even for a short period of time, has only negative connotations.

The interconnection among the different technologies must be understood, documented, and monitored so that the information flows and the processes perform as expected. Who is responsible for this? A Data Governance Committee that understands not only the technology, but also the processes and the users.

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In today's globalized world of business, the ever-increasing requirements of customers regarding products and services has led to a new trend - nearshoring, which allows the companies to respond to customer needs with shorter delivery times and greater flexibility. Miebach Consulting has conducted an international study on this topic to determine how supply chains are affected by current and future shoring strategies, to evaluate the factors for shoring decisions and to show what shoring trends companies expect in the future.

One of the main conclusions of the study is that an increasing amount of companies (51 % of the participants) are producing in closer proximity to their markets instead of moving the production abroad. The study also shows that this percentage is going to increase even more, since 26 % of the participating companies believe that nearshoring is a trend that is going to have a very high or high relevance in a near future, above the offshoring and the onshoring or local production (22 % and 17 %, respectively). See figure 1.

Asked more in detail about which localization strategy they would choose and where they would like to implement it in the future, respondents pointed out that in Europe the preferred strategy will be nearshoring (69%), in America Onshoring will strengthen (43%), while offshoring is still a major trend in Asian countries (67%). See figure 2.

"Modern production processes ensure a stronger focus on customers and can be a competitive advantage given the right location strategy. This is where Near- and Onshoring become more important for companies. Especially the population within the major economic regions can benefit from job creation due to production in proximity to markets." - Prof. Dr. Bernd Müller-Dauppert, Member of the Management Board, Miebach Consulting GmbH.

The study participants expect an increase in supply chain complexity due to Near- and Onshoring trends. The process of choosing an optimal shoring strategy and subsequently selecting the ideal location therefore requires an integrated consideration of both supply chain and production networks.

In all, 127 companies from various sectors took part in the study. Around 1/3 of participants are from North and South America and 2/3 are from Europe.

The complete study brochure can be obtained for free from Miebach Consulting using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

A blog article dealing with the nearshoring trend from the perspective of logistics service providers you will find here. 

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During the past few years many companies have focused on using tools for modelling their network issues. What all projects have in common is the object of determining the optimal location and number of sites as well as the distribution of inventory within the network in order to meet market service expectations at minimum costs.

In how far can software tools support the selection of the ideal location? What are tools capable of? These questions will be answered in the Miebach whitepaper "Selecting the ideal location for a logistics center - much more than simply using tools!" written by Dr. Klaus-Peter Jung.

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The term 4th Party Logistics Service Providers - or 4PL for short - repeatedly comes up in public discussion. Already during the 90's many postulated the success of the concept but this was far away from reality. Comparing the publications, talks and other PR related activities at that time to the number of projects actually implemented it seems that the 4PL euphoria has been more marketing hype than an actual trend.

Long forgotten, the concept is now being revived - 4PL is back in the public debate. But what is this all about, why is this issue being taken up, which players are important and for which kind of industrial and retail customers could this approach be interesting? The following pages give answers to these questions.

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The strength of a businesses internal Supply Chain capability is a result of the need to adapt to ever changing market expectations. To cope with today’s exponential rate of change an increasing number of businesses are relying on external expertise to innovate and exploit supply chain opportunities. Miebach Consulting believes that collaboration is becoming an indispensable component of leading edge supply chains and the factors that need to be addressed to ensure success.

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This whitepaper gives an insight into current limitations and possibilities of robots in logistics, as well as answers and additional suggestions on the current state of robot-based automation, the feasibility of applications and their opportunities.    

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The strategic development of a company is a challenge for many logistics services providers, and previous methods only lead to insufficient solutions. While during the 90s and 2000s the focus was to successfully establish new businesses, it has now changed to attracting new business opportunities. This change is challenging the whole industry.

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Miebach’s participation at the 2016 LLamasoft Summercon Conference included a session on Ideal Supply Chain Design presented by Nick Banich.  The response from the presentation was very positive, and in consequence we have collaborated with LLamasoft to create an E-Book on the topic to be made available to those who were not in attendance.

“The idea of the ’10 Pillars of Supply Chain Design’ was to share the very high-level strategy that we ourselves employ when beginning a project of this nature for a client,” explained Nick, Miebach partner in the US. “By sharing this information with other supply chain professionals, Miebach and LLamasoft can show the value of our respective roles within a design project for our clients.  Between our expertise and the comprehensive Supply Chain Guru software, network designs are able to achieve a greater positive impact for the client’s overall business plan.”

Miebach’s LLamasoft Center of Excellence supports both owners and non-owners of the software across the full spectrum of supply chain design and transformation. 

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The study brochure about the new Miebach pharma survey 2016 with 256 participants is now available. The results show: The pharmaceutical industry is giving its supply chain and logistics a much greater importance than in the past. The top subjects in the pharmaceutical logistics are end-to-end supply chain visibility and optimizing the distribution networks. The increasing volume of refrigerated and frozen products and serialization of product codes are further challenges supply chain managers are facing.

"Our European study clearly shows that most pharmaceutical companies see the European market as a whole region, while national borders are becoming less important, except for specific legislation or distribution channels" - says Martin Eckert, Global Pharma Expert & Director, Miebach Consulting. Optimization of the distribution network has grown very much in importance (from 76 % to 86 %). The initiatives are aiming to transform many national networks into one more efficient and transparent European network, alongside with other many issues.

Topics like improving supplier management (86 %), end-to-end supply chain visibility (93 %), improving forecasting accuracy (84 %) and track & trace (82 %) are some of the most significant issues for the management, very much in line with the previous Miebach pharma study from 2012. Optimization through automation (64 %), outsourcing (62 %) and constructing new warehouses compliant with GxP guidelines (54 %) are also important topics.

The full study report including derived recommendations for action (available in English, German and Spanish language) can be obtained free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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Published in the Logistics Magazine f+h 01/2016

Case Study about Supply Chain Transformation (pdf see download area).

Link to the English version: https://keosk.3dz.com/apps/#/html5/mag/Hlo1K5ArYgLkC/page/18

Link to the Turkish version: https://keosk.3dz.com/apps/#/html5/mag/2OXmhhGD3rREt/page/22

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The heterogeneous Asian-Pacific area increasingly gains importance as a market, with China being the top-performer. The results of the current Miebach Study - Distribution to Asia-Pacific, with more than 126 participants, indicates that 20 % of the surveyed companies already earn more than 15 % of their total turnover in this area.

“All signs point to expansion in Asia-Pacific, although companies will have to adjust their delivery time and service level to European standards”, said Prof. Dr. Bernd Müller-Dauppert, member of the executive board of Miebach Consulting GmbH.

More than 75 % of participants expect an increase in delivery time requirements. As of right now, more than half of the exporting companies have to supply customers within 14 days; almost a quarter within three days. Two thirds of the participants additionally expect an increase in competition, which will result in an even higher service demand. To fulfill delivery time requirements, three quarters of companies pursue a supply chain strategy precisely for Asia-Pacific. Especially the strategic importance of agility and flexibility in the region is assessed highly, followed by the CPFR-concept (Continuous Planning, Forecasting and Replenishment) as well as supply chain transparency. Further important topics for Asian-pacific companies are supply chain differentiation by customer demands as well as the use of current IT-systems.

A majority of companies (41 %) distribute their products in all five Asia- Pacific regions and almost a quarter within four regions. Exporting companies with local production have on average eleven  mainly self-owned warehouses in Asia-Pacific. Only a small number of companies consider developed countries like Australia/ New Zealand and Japan/ South-Korea as attractive production locations. That indicates that companies are following consumer markets: Higher saturated markets have higher customer demands – therefore, a customer proximity is required.

Background of the Study: 

Miebach Consulting conducted a survey in June and July 2015 about distribution to Asia-Pacific. An online survey was used as research method, which was sent to companies from different industries. The survey was analyzed completely anonymously.

The complete study report in English language can be requested free of charge using the form or by e-mail to Ralf Hoffmann (hoffmann@miebach.com), stating the contact details.

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The article deals with three technological trends, which might revolutionize the world and have a major impact on supply chains: 3D, printing, robots and drones.

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