Social Media Literacy and the Supply Chain
Inventory & Supply Chain Optimization
Inventory & Supply Chain Optimization
In today’s interconnected, digital world people are able to access more information than ever, and we’re using more data, too. By next year, 2016, it is estimated that there will be 3.4 billion internet users and “1.2 million minutes of video, or the equivalent of more than two years worth, will be consumed every second.”
Why will videos be at the forefront of data streams and downloads? In addition to television and films’ migration to the internet, increasingly, people want a medium that provides a fuller picture. More and more, people want to learn and view the whole truth. This coincides with a push for transparency in politics, nutritional labeling, big bank bonuses, and data collection, to name a few.
People are also accustomed to immediate information access. You can track a flight in real-time, review medical records, pay bills, “see” a friend half way around the world, all with a few clicks of the keyboard. You can also do substantive and thorough research that had, in the past, been impossible without a library card and many hours to spare. Additionally, the rise of social media provides an outlet for those who want to share more about themselves, or gain immediate information about others.
How are these two things: demand and access, changing the workplace? Companies, leaders, and employees are being asked to reveal information about themselves more and more. Trends in society impact business. People don’t want leaders who distance themselves and seal off information. They want leaders who are, increasingly, transparent. In a Forbes article about transparent leadership, Glenn Llopis writes, “besides the need for job security and career advancement opportunities – employees want to be a part of a workplace culture that puts a premium on delivering the truth. They desire their leaders to be proactive in sharing where the company is headed and forthright about its future.”
The hunger for transparency extends to all areas of the workplace. More than ever, employees are being monitored, open floor plans are peppering office spaces, and companies are sharing detailed financial information. However, as referenced in a Wall Street Journal article, there are drawbacks to this seemingly utopian clarity: “more transparency isn’t necessarily better. Rather, smarter transparency is better. If leaders can adopt a transparency strategy that strikes a balance between openness and privacy, that tears some walls down while leaving others in place, they are more likely to get the results they want.”
Here are some potential benefits of transparency in the workplace:
Smarter transparency is important, as there can be negative sides to complete transparency. Here are some ways in which transparency is coming to the workplace, for better or worse:
People can often view each other’s profiles, both professional and personal. Social networking can be a way for people to package themselves, advertise, and find opportunities. However, if not properly used and monitored, social media can be detrimental. People have been fired from their jobs and some companies have deeply embarrassed themselves and alienated customers.
Monitoring employees can increase safety, comprehension of policies, and productivity. It can also provide a system to acknowledge employees’ strengths and accomplishments that might otherwise go unnoticed. Employee monitoring can also provide feedback on errors and help save money by addressing employees who are utilizing work hours to do personal business. On the downside, employees can sometimes feel uncomfortable or resentful about being monitored. UPS workers are some of the most monitored employees out there, which brings many benefits to the company and often to the drivers, however, according to one driver, “it does feel like big brother.”
Traditionally only a few people are aware of the detailed finances of a company. Some companies are now sharing all finances so that all employees can feel like one of the “players”. According to a Harvard Business Review article, Share your Financials to Engage Employees, by being a player employees can know the rules and feel invested. With transparency, such as sharing all salaries, honest and difficult conversations will happen and, “tough conversations, over the long-term, are a good thing.”
For decades open-office layouts, where employees work side by side, have been popular. According to a New Yorker article on the open-office concept, it was originally conceived to “facilitate communication and idea flow.” The idea of employees being siloed behind closed doors seems counterintuitive when thinking of transparency. However, as modern and forward-thinking as the open-office layout seems, this trend has its faults. Many employees experience decreased productivity, and only engage with people sitting right near them. Studies have also shown that health decreases when more employees are seated together. Noise can be the largest issue of all. According to one employee who works in an open seating environment, “Headphones have replaced cubicles,” he said. “I wear them to let people know I’m busy. “
Increasingly we demand transparency, and in the workplace there are pros and some cons. Being smart about the transparency we’re seeking and providing is important, as we must remember that above all transparency comes with accountability.
Change management is the process of taking an individual or a group of people from a current state to a more desired state. Its recent prevalence, and often necessity, is heavily due to new technology and globalization. As humans we experience change constantly, on micro and macro levels. Today alone, around 350,000 babies will be born and 150,000 people will die. Gas prices might have dropped recently or your favorite flavor of potato chips might be discontinued. Stock prices rise and fall by the second. Nearly everything changes, yet the word change is often scary or stressful, especially when applied to the workplace.
Alan L. Milliken wrote in his article The Importance of Change Management in the Supply Chain that the key components of a successful business are process, technology, and people. He terms this the “Triad of Operational Excellence.” How is this “triad” involved in change management?
Sometimes process is the reason for implementing change. Are the processes in the supply chain preventing timely order fulfillment? Can the current process ensure proper, safe, and secure delivery? Are current processes compliant with regulations, nimble enough to weather unexpected change, efficient and modern enough to match innovative competitors? These are all good points to assess. When implementing change is it critical to understand a company’s current capabilities, what needs to be changed, and whether the current systems and finances can support change.
Often change management can be spurred by a need for technological growth. If the end-to-end supply chain has antiquated practices, and one member of the chain is transitioning to modern technology, the rest of the players involved may feel the need to change despite being resistant to new technologies or feeling overwhelming by the cost and steps required to transition.
Some companies with decades or a century of business behind them, may be nervous about shifting to a social media driven, on-demand paradigm. There are many benefits to modernizing, and seeing the long-term view of how technology and media can assist business is critical. One company that has made changes to the way they present their business is the packaging supply company, Laddawn. Overhauling their website and providing customers with new purchasing capabilities has put them at the forefront amongst competitors. According to CEO, Ladd Lavallee, “It’s difficult for manufacturers to invest in service, or service technologies, because production can easily consume our time and money. But we need to make our customers’ lives easier if we want to keep winning their business in a shrinking world.”
If leaders aren’t on board with a change management process their frustration or hesitation can seep into others’ mindsets. Studies have shown that emotional contagion occurs in society, and in business. People who cultivate a positive mind-set perform better in the face of challenge. When Bert’s Bee’s was rapidly growing on the global market, then-CEO, John Replogle, worked positive emotional contagion into his workplace, realizing, “Leaders, by virtue of their authority, exert a disproportionate impact on the mood of those they supervise.” He saw this change as an opportunity for people to grow as the company was growing.
In a sweeping meta-analysis of 225 academic studies, Sonja Lyubomirsky, Laura King, and Ed Diener found that happy employees have, on average, 31% higher productivity; their sales are 37% higher; their creativity is three times higher. According to executive coach and business consultant, Sara Regan, of Common Focus Consulting, thoughtful leadership during change is critical to success and employee satisfaction, “The biggest mistake I see leaders make is that they are too late in bringing others into the process. It usually creates more work in the end since it heightens anxiety and resistance then making the leader push harder instead of listen. The way in which leaders approach change impacts the end results but also the ongoing trust and engagement of the team.”
Certainly there are times when change is not necessary in a company, but when it is, aligning the process, technology, and people are key to reaching a new, more successful and desired state.
The phrase “If it ain’t broke, don’t fix it” is often attributed to Thomas Bertram Lance, businessman and Director of the Office of Management and Budget under President Jimmy Carter. He was quoted in the May 1977 issue of the magazine Nation’s Business, though the sentiment feels as old as human existence. If something is working, and has always worked, then why change it? There are many adages along the same lines: leave well enough alone, never change a running system, don’t change a winning team.
True, humans are always evolving, but we also like consistency and stability. In his book Handbook of Contemporary Economics, Morris Altman wrote, “Without some stability over at least the short term, it is hard to conceive of humans engaging in sustained goal-oriented activity.” Change, adaptability, and flexibility, especially in business culture and lore, have turned from buzzwords to commandments. There are some things, though, that don’t require change. Assess whether change is necessary, rather than assuming it is because it’s socially and commercially popular. Ask:
If the answer to these questions is yes, then why change? According to Harvard Business Review change could alienate your base, confuse people, damage your brand, and lose you money. Cadbury and its parent company, Kraft, are experiencing intense backlash due to a change in the Cadbury Creme Egg recipe. People are protesting, writing letters, posting negative comments online, and accusing the company of “ruining Easter.” We’ve seen this before. According to TIME’s article on the top 10 bad beverage ideas, “April 23, 1985, stands as one of the most significant dates in business history — the date the 99-year-old Coca-Cola company announced it was scrapping its original soda formula for a newer, sweeter version.” This change brought with it over 40,000 letters of protest, not to mention the bad press. Within three months the original soda formula, Coca-Cola “classic”, was back and met with an incredibly positive reception.
Some companies opt for a subtler approach to change by expanding its traditional offering. Instead of changing the successful product line for women, Dove expanded into the male market, creating Dove Men+Care, while still adhering to their public image and mission of creating personal care products that support natural health and realistic beauty.
The Harvard Business Review lists Brooks Brothers as a company that successfully found new opportunities without changing its values, “Instead of simply sticking to selling classic clothing, and waiting for outside catalysts (such as the popularity of the fashion in the television show Mad Men) to increase its popularity, the chain innovated around the edges by offering more fashionable accessories — shoes, belts, bags and the like — while leaving its core basically unchanged.” Capitalizing on this opportunity did not drive customers away because Brooks Brothers’ base products remained.
Remember that change has a cost. Are your consumers willing to pay the cost, especially if they didn’t require the change in the first place? Will your partners in the supply chain be willing to do business with you if the change you implement doesn’t suit them or benefit them? Think about some of the elements, for example, of a brand change:
Things such as graphic design, business cards, letterhead, social media, advertising, re-launch, etc. all require real time and money. You must assess if your change will reap real, solid benefits. You don’t want to expend the effort, time, and money to change if you don’t have to, especially if it requires reversing the change or worse, killing your business.
During his TED talk on the Internet of Things (IoT) technologist, Dr. John Barrett, described how every thing: appliances, furniture, vehicles, equipment, soil, food, animals and humans can become connected, identified, monitored, managed, and controlled. By 2032 he predicts that each person could come in contact with 3,000 to 5,000 connected things each day. IBM sees the Internet of Things as the planet’s new central nervous system.
The Internet of Things is already here and developing—monitoring our footsteps, heartbeats, lighting, home temperature and environment— and it will continue to grow at a rapid rate: “The growth in IoT will far exceed that of other connected devices. By 2020, the number of smartphones, tablets, and PCs in use will reach about 7.3 billion units,” said Peter Middleton, research director at Gartner. “In contrast, the IoT will have expanded at a much faster rate, resulting in a population of about 26 billion units at that time.”
This will have a huge impact on the supply chain as we currently know it. In his talk, Dr. Barrett describes how a food processing company waiting for a delivery of shellfish will be able to not only “know where the food delivery is, but its entire storage and shipping history since the moment it came on board” the boat. Already, some vendors are able to remotely monitor their vending machines and access data about temperature, supply, and theft. In the future vending machines will be able to recognize a customer, recall their past preferences, and “even refuse to vend a certain product based on a shopper’s age, medical record, dietary requirements or purchase history.”
How else will we see IoT inform end-to-end transactions within the supply chain? Transparency in the supply chain is already growing with the swell of ERP and SCM, and with its growth it brings collaboration, clarity, and trust. With the increased use of Radio Frequency Identification (RFID) computer chips can talk to each other, and gather and deliver more detailed information than ever. Visibility in the chain will continue to expand and improve operations. The IoT will impact the supply chain in many ways including the following:
Many companies are already employing the IoT, and as a result they are seeing improvements while working out the kinks of this new technology. UPS has increased single carrier deliveries with the use of sensors. According to David Barnes, the company’s chief information officer, more than 200 measurements can be tracked on a delivery truck from “how fast the vehicle is traveling, how aggressively it’s accelerating or decelerating, the RPMs and the fuel consumption. We can hook into the engine bus environment. We also put in a GPS unit. There are sensors on the engine and on components like starter motors and seat belts.” The analysis of this data is a main focus for UPS and has resulted in improved safety management, fuel efficiency, environmental impact, and customer satisfaction. One carrier reported that his deliveries increased from 90 a day to 120 a day. UPS drivers have seen an increase in salary as the company’s revenue multiplies.
The $1 billion UPS invests in technology per year is producing results, but what are the downfalls of telematics and other advancements? The union representing UPS workers has already set forth some demands: drivers cannot be monitored without being informed and cannot be disciplined “based solely on data.” One driver noted that it “does feel like big brother.”
Issues of security, privacy, accuracy, capacity, and the growth of software substitution in the workplace are all matters that need to be examined as IoT explodes. As IoT matures, it is wise for companies, especially those in manufacturing and logistics, to pay close attention. As reported by Gartner, by 2020, “Economic value-add (which represents the aggregate benefits that businesses derive through the sale and usage of IoT technology) is forecast to be $1.9 trillion across sectors.” With the increased possibility, reach, and data of the IoT will come complex decisions and opportunities for businesses.
Fronetics’ Kate Lee has written extensively about the Internet of Things and the supply chain. Her article, How the Internet of Things will change your world, was published in the Quarter 1, 2015 edition of Supply Chain Quarterly.