Tyler Higgins is a managing director at AArete, a global management consultancy, and leads the firm’s retail and consumer practices.
In 2015, blockchain (the technology that makes digital currencies such as bitcoin work) was starting to be explored as a solution for supply chains. It promised cost savings, increased efficiency, and heightened transparency, among other benefits. For that reason, many companies were happy to run pilots testing blockchain for themselves. Today, these small-scale projects have been replaced by large-scale enterprise adoption of blockchain-based supply chain solutions. There are plenty of choices now for blockchain supply chain products, platforms, and providers. This makes the option to use blockchain available now to nearly everyone in the sector. This wealth of choice does, however, make it more difficult to decide which blockchain integration is best (or, indeed, if your organization needs to use it at all). To find the right blockchain, companies need to consider three factors: cost, sustainability, and the ultimate goal of trying new technology.
Choosing the right blockchain for an enterprise supply chain begins with the most basic consideration: cost. Blockchains work by securely recording “transactions,” and in a supply chain, those transactions are essentially database updates. However, making such updates has varying costs on different chains. If a container moves locations, that entry is updated, and a transaction is recorded. Enterprises need to figure out how many products, containers, or pieces of information they will process daily. Each of these can be considered a transaction. Now, some blockchains cost not even $1 to record a million movements. Other chains can cost thousands of dollars for the same amount of recording. Understanding the amount of activity you will need to record against the cost of transactions is the first place for an enterprise to start when considering blockchain. Ask the provider which blockchain their product is built on, and its average transaction cost. This will help you find the most cost-effective product or integration.
The question of cost becomes even more important when your supply chain partners have other transparency obligations, like that of a “Protected Designation of Origin” product. This kind of requirement means that your adoption of blockchain will likely involve more transactions, or records, to serve your purpose, which means utilizing a blockchain with lower costs is imperative. This was the case for producers of Fontina cow’s cheese. This is a “Protected Designation of Origin cheese,” which means it must come from the Aosta Valley (and only the Aosta Valley) in Italy. Utilizing blockchain helps prove the provenance of this artisanal cheese to its customers and partners, which is one of the reasons it was adopted by the group responsible for its production (the Consortium of Producers and Protection of Fontina PDO). However, when reporting on their adoption of blockchain in their supply chain, they also acknowledged that the potential high costs of using the technology were a concern (but this was allayed by their choice of blockchain platform and design of their pilot).
The second consideration is sustainability. Supply chain partners are being pressured to deliver on ambitious environmental, social, and governance (ESG) targets across the board. The addition of new technologies to any system, especially technologies like blockchain and artificial intelligence (AI) that are known for their energy use, can be counterproductive to meeting these expectations. However, just as different blockchains have different costs to run transactions, so too do different chains have different environmental footprints. This can also be easily vetted by asking your provider if the chain is proof-of-work or proof-of-stake.
Proof-of-work is most well-known because it is used by bitcoin, and can cost an extremely high amount of energy and electricity to run. If the blockchain is proof-of-stake, it is more likely to be environmentally friendly. The good news is that many supply chain and logistics service providers are stepping in to offer these greener blockchains as an option for their projects. One of these is Finboot in Spain, which worked with the energy company CEPSA to implement blockchain to trace vegetable oil from its source to its end use in its biodegradable surfactant production. Still, ask for their sustainability credentials anyway. If there’s any reason to doubt that the blockchain being used or the solution being proposed is carbon-neutral, the solution has to be disregarded. There’s just no reason to adopt more technology if it will present more problems later on.
The final consideration is the toughest but also the most rewarding: the ultimate goal of adopting blockchain. What improvement is the most important to your business? Blockchain could address several of them. For example, there is a movement towards maintaining a fair trade for goods like chocolate and coffee. However, the true “fairness” of the provenance is only as good as the records. Blockchain can help here, as proven by the household Italian coffee brand Lavazza.They integrated blockchain to simplify and streamline the supply chain journey of its La Reserva de Tierra Cuba coffee bean, making it easy for consumers to see the journey from farm to cup. Each coffee bean harvest and reception, environmental data and processing information, quality control, and transportation are recorded on a publicly available blockchain for the company and the consumer to use. They are also using a carbon-neutral chain with low costs, helping them hit their sustainability as well as their fair-trade goals.
Improving internal provenance records is also a valid reason to adopt blockchain, making it easier to maintain a stringent, auditable record that can be provided to other departments, shareholders, governments, or regulators. This kind of provenance can be more detailed and more sensitive to attempts to access or change the data. So, using blockchain to certify medicine shipments, as one example, allows an enterprise to securely control a record of authentic, noncounterfeit medications. This is especially important if counterfeit medicines end up causing harm and government agencies investigate. Otherwise, blockchain can help make supply chains more resilient to digital attacks or intrusion, reduce costs of maintaining records, fight the threat of counterfeit goods, and more.
The supply chain sector is under pressure to be even more efficient and reliable despite a challenging economic and geopolitical landscape. Still,a recent report from EY stated that enterprises plan to “shake up their supply chain strategies to become more resilient, sustainable, and collaborative with customers, suppliers, and other stakeholders.” If that is the case for your organization, then certainly blockchain can help you. Blockchain’s internal provenance and integrity makes a supply chain more resilient, including by helping identify potential disruptions early, streamlining regulatory compliance and internal audits, and detecting counterfeit products and fraudulent activities. Blockchain is also a tool for collaboration with your stakeholders. Lavazza is just one example of how it can be used to give customers verifiable information about product origin, journey, and authenticity, building confidence and loyalty through transparency and traceability. And if you choose a blockchain that is itself sustainable, it can help achieve sustainability goals too. The most important filter, however, remains the ultimate goal. What do you want to improve or change about your operations? If the answer involves becoming more resilient, more transparent, or more efficient, blockchain can help. Use this goal to evaluate your options first, followed by an analysis of costs and its sustainability metrics. By considering these three factors, you are more likely to find a scalable, resilient, and efficiency-delivering use of blockchain in your supply chain business.
An advanced transportation management system can help with route optimization, real-time tracking, multimodal management, and predicting potential supply chain challenges.
A transportation management system (TMS) is a critical tool for all supply chain and logistics practitioners. It provides shippers, third-party logistics companies (3PLs), and fourth-party logistics providers (4PLs) with the visibility they need to manage the supply chain and optimize the movement of products and goods. There are various types of transportation management systems, and while using a basic TMS is better than no TMS at all, advanced transportation management systems offer enhanced functionality and can scale with you as your business grows.
Getting the right TMS in place can have considerable benefits, as a TMS helps with planning and executing the movement of goods on a comprehensive level, which aids in reducing the risks of disruptions at every point in the supply chain. Companies that better manage risk will see significant savings. Data from the supply chain risk intelligence company Interos found that of the organizations they surveyed in 2021, the average organization lost $184 million in global supply chain disruptions. Similarly, a McKinsey study found that, within 10 years, the cost of supply chain disruptions adds up to nearly half of a company’s profits.
Differences exist between TMS solutions, with not every organization or product offering the same features. More advanced TMS solutions go further, providing greater visibility and control. Consider some of the differences of using an advanced TMS for your logistics operation.
A basic, or “lite,” TMS solution offers some nice features and enhances productivity. It offers features related to basic routing and order management, and it gets your products moving.
By comparison, an advanced TMS will include additional tools to enhance success, including:
A basic TMS solution is typically best suited for small businesses. It does not provide advanced features to support more complicated needs. The more complicated your logistics needs are, the more robust the features on your TMS must be, including both in the planning and execution stages.
An advanced TMS offers more of what you need if you are a medium-sized business planning to grow or if you are a large enterprise right now. It offers solutions to adapt to more complex and intricate supply chain models. In high-volume networks, this is critical. If you expect to see significant demand increases, or your supply chain experiences seasonal demand fluctuations, an advanced TMS is the better solution.
Organizations also must consider how well their existing data and tools will integrate into a new system. A basic TMS will facilitate some options but tends to have limitations on what types of products and solutions it will integrate with overall. More so, it does not have the ability to take the data it has and provide you with comprehensive analysis, but rather just offers the data for you to analyze yourself.
An advanced TMS goes further by providing more advanced analytics, including opportunities to incorporate the tools you need as you grow, such as an enterprise resource planning system, warehouse management system, order and inventory management tools, real-time visibility tools, and accounting systems. It also offers more comprehensive reporting tools.
Partnering with a 4PL or managed transportation services provider and implementing an advanced TMS is a strategic play that's going to have a very dramatic impact on the profitability of your business’s profitability and resilience.
An advanced TMS equips companies with essential tools to capture and leverage data effectively, offering enhanced visibility, and control over logistics processes. By enabling real-time insights, predictive analytics, and seamless data integration, an advanced TMS transforms complex supply chains into strategic assets. This level of supply chain optimization empowers businesses to address disruptions proactively, drive growth, and maintain a competitive edge in today’s dynamic global marketplace.
Labor strikes can stop supply chains in their tracks unless companies take steps to build up resiliency.
Strikes and potential strikes have plagued the supply chain over the last few years. An analysis of data from the Bureau of Labor Statistics by the Economics Policy Institute concluded that the number of workers involved in major strike activity increased by 280% in 2023 from 2022. Currently, the U.S. East Coast and Gulf Coast ports are facing the threat of another dockworker strike after they return to the negotiating table in January to attempt to resolve the remaining wage and automation issues. Similarly, Boeing is continuing to contend with a machinists strike.
Strikes, or even the threat of a strike, can cause significant disruptions across the global supply chain and have a massive economic impact. For example, when U.S. railroads were facing the threat of a strike in 2022, many companies redirected their cargo to avoid work stoppages and unhappy customers. If the strike had occurred, it would have had a massive economic impact. The Association of American Railroads (AAR), estimated that the economic impact of a railroad strike could be $2 billion per day.
Similarly, although the U.S. West Coast ports avoided a strike in 2023, the labor negotiations caused companies to reroute freight. For example, companies with locations on the East Coast went through the Panama Canal instead of having their cargo land at West Coast ports. As a result, West Coast ports’ market share dipped during this timeframe. Now as the East Coast and Gulf Coast ports try to finalize negotiations to seal the deal with the International Longshoremen’s Association (ILA), companies are searching for alternative routes and transferring their shipments back to West Coast ports. The economic impact of the strike is estimated at $3.8 to $4.5 billion per day by J.P Morgan.
Labor negotiations also threaten to further exacerbate inflationary trends, which have been a key concern across the supply chain. The ILA and port operators reportedly reached a tentative agreement to increase wages by 62% over the next six years. Similarly, the Boeing machinist strike is mainly related to a request for a 40% pay raise, with machinists recently rejecting a proposed 35% increase. These demands come as companies and consumers across the spectrum are resisting increased costs.
Nor are these strikes completely focused on pay increases. The ILA is also demanding a total ban on the further automation of cranes, gates, and container movements that are used in the loading or loading of freight. This issue still remains unresolved. Such a ban would not only increase costs, it would also threaten the competitiveness as the U.S. ports, which are already some of the least competitive in the world. According to the Wall Street Journal, L.A. and Long Beach ports are about half as productive as China’s best port in terms of average container moves per hour.
Labor unrest and strikes have caused executives to open their eyes to the volatility, uncertainty, complexity, and ambiguity (VUCA) in their supply chains. Many are responding to the volatility and disruptions by working to create more resilient supply chains.
No company can thrive in a supply chain disruption-ridden environment if it is not prepared to pivot as conditions change. However, preparation alone will not suffice. To thrive in a VUCA world, companies should be ahead of changing conditions or perhaps flip the situation on its head to become the disruptor instead of the disrupted. As the competition struggles to maintain customer service levels, profitability, and working capital requirements in the face of disruptions, companies with a more resilient supply chain will gain market share.
There are several strategies to create a resilient and proactive supply chain. The most successful approaches include rethinking strategies, upgrading business processes, and automating and utilizing advanced technologies. The bottom line is to create resiliency/flexibility, quick responsiveness, and upgraded performance.
Old strategies will no longer suffice in this more volatile world. For example, producing in China to reduce labor costs provides no resiliency when chokepoints arise in the global supply chain and/or as geopolitical risks surge. For example, the Red Sea crisis has created a supply chain chokepoint, delaying goods transiting from northeast Asia to the East Coast of the U.S. and Europe. Container ships have re-routed around the southern tip of Africa, adding cost, time, and other risks to the trip. As labor disputes and/or strikes arise, the risk increases that the product will get stuck or delayed in transit. If there are strikes on the East Coast and Gulf Coast ports, ships will have to divert to the West Coast and be shipped across the country, adding time and cost. By moving manufacturing closer to customers and consumers through reshoring, nearshoring, and vertical integration efforts, these risks are mitigated. If local disruptions do occur, companies can recover quicker due to the shorter distances, quicker lead times, and greater control.
Thus, proactive executives are rethinking their manufacturing and supply chain network. For example, Ascential Medical & Life Sciences last year expanded its domestic manufacturing footprint, opening a 100,000-square-foot facility in Minnesota that will specialize in developing custom manufacturing machinery and solutions for medical and life science companies. The facility is part of a broader reshoring effort by the company.
In a similar vein, many companies, such as GM, Samsung, and Dell, have followed a nearshoring (also called friendshoring) strategy to Mexico. By moving closer to customers, they not only are more resilient but also can take advantage of trade agreements, such as the United States-Mexico-Canada Agreement (USMCA), as well as lower regulations and costs.
In addition to moving manufacturing, companies are also diversifying their supply base. They are pursuing strategies such as adding backup sources of supply, establishing strategic partnerships and joint ventures, and vertically integrating their supply chain.
The most successful companies are aggressively upgrading strategic processes to support resiliency, customer success, and profitability. For example, rolling out an SIOP (Sales, Inventory, Operations Planning) process can help companies respond more quickly and proactively to changing customer demand and/or supply chain disruptions. Similarly, companies that have upgraded their demand, production, and replenishment planning processes are able to provide customers with higher service levels while also freeing up cash by reducing unnecessary inventory. These upgraded planning processes also improve margins by increasing efficiencies and productivity while reducing waste.
For example, a manufacturer of health care products utilized a SIOP process to better predict revenue and to create a better operational rhythm. The company’s demand plan was translated into machine capacity and critical raw material requirements. By taking this step, the company became aware that it needed to get a backup supplier to avoid a potential critical chokepoint in the supply chain. At the time, the manufacturer was purchasing all of its most important material from Brazil. Due to geopolitical risk in the region, there was the potential for supply chain disruption. To mitigate this risk and ensure reliability, the manufacturer began sourcing 20% of its material requirements from a backup supplier in the United States. Fast-forward a few years, and there was a port strike that made it difficult to receive the materials from Brazil. The manufacturer’s SIOP process provided a forecast of what was required to bridge the supply gap during the disruption. Because of the already existing relationship, the backup supplier was willing to ramp up volume to cover the manufacturer’s supply gap, even though the supplier was receiving an overload of requests from other companies. As a result, the manufacturer was able to maintain supply of this critical material and continue to meet its customer service levels. While its competition struggled, the health care manufacture was able to grow its revenue by 15%.
Technology can also help companies respond better to disruptions and volatility. For example, advanced planning systems can help planners can quickly pivot with changing conditions, such as strikes. The most advanced of these systems will be equipped with artificial intelligence (AI) capabilities that will recommend changes on the fly to satisfy customer needs in the most profitable and least risky manner. For example, as strikes arise, the system will quickly assess changing conditions and recommend that the manufacturer move demand to plants and/or routes not impacted by the strike. The planning systems will also provide the planners with a better picture of requirements so that they can change production plans and ensure high service levels for customers.
In the same fashion, companies that automate their manufacturing processes, such as by using robotic welders, can more flexibly respond to changing customer requirements change while also mitigating costs. Similarly, companies that use additive manufacturing technologies can produce and customize on demand. By using robotics and automation equipment, manufacturers can run lights out, thereby increasing output and flexibility, while reducing cost. Therefore, if a strike occurs at the manufacturer, some level of production is likely to occur, as long as they can assign a resource to keep the robotics and automated equipment running.
In logistics, advanced technologies can seamlessly sort, package, and move products. These technologies can help companies quickly respond to changing conditions so that packages can be re-routed at any time. Similarly, transportation planning can use predictive models to optimize freight costs and rerouting shipments through the global supply chain in response to changing conditions, thus ensuring timely deliveries. For example, as strikes arise, the system will quickly assess a company’s transportation network, evaluate alternative routes, and recommend the optimal one. Changes will also be made to current routes for goods in transit so that they meet the customer due dates at the lowest cost.
The bottom line is to create a resilient supply chain and craft tomorrow’s supply chain today. Companies that invest smartly in the future will be prepared to take market share as disruptions occur. There will be more opportunity than ever before for those that rethink strategies, upgrade business processes, and automate and digitize their end-to-end supply chain.
About the author: Lisa Anderson is founder and president of LMA Consulting Group Inc., a consulting firm that specializes in manufacturing strategy and end-to-end supply chain transformation that maximizes the customer experience and enables profitable, scalable, dramatic business growth. She recently released SIOP (Sales Inventory Operations Planning): Creating Predictable Revenue & EBITDA Growth that can be found at https://www.lma-consultinggroup.com/siop-book/.
Future warehouse success depends on robot interoperability.
Interest in warehouse robotics remains high, driven by labor pressures and a general desire to further automate distribution processes. Likewise, the number of robot makers also continues to grow. By one count, more than 50 providers exhibited at the big MODEX show in Atlanta in March 2024.
In distribution environments, there is especially strong interest in autonomous mobile robots (AMRs) for collaborative order picking. In this application, the AMR meets pickers at the right inventory location, and the workers then place picks in totes on the robot, which then moves on to another location/picker or off to packing, greatly reducing human travel time.
While the use of robots in distribution is still early in its maturity, for many, if not most, companies, the future is one of heterogeneous robots—different types of bots from different vendors operating in a given facility. With the growth in robotics, these different robots will often need to communicate with each other—either directly or indirectly through use of an integration platform—to automate the flow of information and work. This is broadly termed “interoperability,” and it is an important concept for companies planning warehouse robotics initiatives, with the ultimate goal of achieving a “plug and play” environments where new robots can easily be added to the automation mix and processes adapted over time.
Why is interoperability important?
Consider the following example. A company buys perhaps 20 AMRs to support collaborative picking. A few years later, additional AMRs are needed to support growth. But now there is another AMR from a different vendor that the company prefers for cost, design, change in stock keeping unit (SKU) attributes, or other factors.
Interoperability will allow a company to keep the AMRs they have and seamlessly add the new AMRs to the mix. Beyond basic integration, a company will want to manage the robots across both vendors in terms of visibility, task assignment, performance measurement, and more, operating as if it’s a single fleet.
That’s a good example of what interoperability is all about.
There are some initiatives across the robotics sector to develop cross-vendor integration protocols that will make interoperability much easier. However, these standards, such as VDA5050 (a standardized interface for automated guided vehicles) and the Mass Robotics 2.0 AMR Interoperability Standard, are either not widely used or are still under development.
Many vendors have also started offering support for what is called a “robot operating system” (ROS/ROS2). However, this is a loose, open source framework (not a full standard) that doesn’t fully address the interoperability challenge.
In the absence of useful standards, companies still have a few options for achieving interoperability. One is the traditional approach of manually programming interfaces between different robots and interfaces between robots and software systems such as warehouse management (WMS) or warehouse execution systems (WES).
The downsides of this approach are well understood. They include extended developing times and the high cost to get the integrations done, as well as a significant lack of flexibility down the road, with some added risk thrown into the mix as well.
A better alternative is the use of a platform strategy. Which begs the question: What is a robotics platform?
A robotics software platform is a middleware ecosystem—cloud-based or on-premise—that provides various capabilities and services from integration to fulfillment planning and execution. It also acts as a bridge between automation systems and various enterprise software applications.
The starting point for any robotic platform success is, in fact, integration. That integration capability includes advanced tools that enable flexible “no code/low code” approaches to connecting robot fleets.
The right platform can also more rapidly integrate with WMS/WES or other software applications, using AI to greatly accelerate the often time-consuming data-mapping process. Once the WMS/WES is connected to the platform, then the robots are also connected to enable real-time, bidirectional access to the WMS/WES data.
Such a platform delivers interoperability across robot types and connects different automated processes. A simple example would be a communication from the platform to a robot needed to move goods from receiving to reserve storage, where another robot is made aware via the platform that there is a new putaway task ready for completion.
To maximize interoperability opportunities, companies should consider the following interoperability-related capabilities that may be available from a given robotics platform:
Flexibility in integration based on robot software functionality: Different robot vendors come with software at different levels of maturity. An interoperability platform should be able to work with robotic vendors at any level of software functional capability, ensuring flexibility in robot selection.
User experience consistency: For interoperability to be functionally effective, the user interface across robotic-enabled processes should be consistent, so that users can easily interact and switch between different tasks.
Flexible communication protocols: A platform should provide support for a wide range of different protocols, such as application programming interfaces (APIs), socket communication (a two-way communication link between a server and a client program), web services, ROS/ROS2.0, and VDA5050, to name just a few.
Observability: AMRs especially will generate huge of amount of data on their movements and activities that can be used for analytics. The robotics platform should normalize data packets from different vendors to create a unified dashboard.
Safety and risk mitigation: A robotics platform can help achieve safety across different types of robots by understanding the safety protocols of different machines and coming up with a common set of rules. These rules will exist in an extended fleet manager that runs in the platform and sits on top of the fleet managers of each individual brand of AMR.
While some of these capabilities may not be relevant in a company’s early years in warehouse robotics, they could prove valuable down the road, so give them some consideration today.
We’ve already covered a couple of common robotic interoperability use cases:
Here is another: One global consumer goods company wants to heavily automate distribution processes but give individual regions or countries they operate in the flexibility to select the vendor for a specific type of robot (for example, a layer picker) and be able to easily plug that specific equipment into the larger platform infrastructure. This allows a centralized automation strategy with local execution.
For a significant and growing number of companies, the future on the distribution center floor will be robotics of multiple types and vendors. To maximize flow and productivity, these heterogeneous environments must adopt interoperability strategies, enabling systems of different types to operate as if a single fleet. While standards to help with all this may arrive in future, for now a robotics integration and execution platform will provide an attractive alternative to traditional programming-heavy approaches.
The second annual 3 V’s of Supply Chain Innovation Awards Contest is in full flight at CSCMP’s EDGE Conference, recognizing companies that have used the 3 V’s Framework (variability, visibility, and velocity) to achieve success.
I’m repeatedly asked, which companies use their supply chain networks as their anchor of corporate competitiveness, embracing variability, harnessing visibility, and competing with velocity?
The top supply chain networks I admire demonstrate a clear “competitive moat” with their supply chain networks and have a market-based strategic advantage. While I somewhat appreciate the historical answers to the question, “Who are your top supply chains?”¾the answers to this question tend to be based on the tactical views of balanced scorecards, return on equity or assets, and how supply chains impact business performance. However, my top supply chains are above that fray.
I am a true believer that strategy is very different from tactics. So, I put a different lens on the question. My top supply chains are my industry “icons”: Intelligently Curated Orchestration Networks. Companies that see their supply chain networks as strategic assets embrace variability, harness visibility, and compete with velocity by deliberately curating their supply chain network.
The supply chains I admire use their supply chains not just as logistical tools but as strategic weapons, transforming them into powerful engines of market-based advantage to rise above the competition. These companies Intelligently Curate and Orchestrate their Network.
Which companies have redefined the role of supply chains, turning complexity into opportunity and positioning themselves as leaders in the face of uncertainty? Three companies that are using their supply chain networks as an anchor of corporate competitiveness are Banner Engineering, Tracegains, and Altana.
At the heart of Banner's success is its ability to embrace variability by harnessing the visibility of their customer's wants and needs and a deep understanding of their suppliers' capacities and capabilities. This insight allows them to embrace variability by serving multiple industries with thousands of different products at an unmatched velocity. Banner doesn't merely adapt to change; it thrives on it. Each year, they introduce over 30 new products, consistently creating solutions that customers love.
Minneapolis-based Banner Engineering, founded in 1966, has emerged as a leading designer and manufacturer of industrial automation products. With a portfolio of more than 10,000 products, Banner serves multiple industries, including automotive, food and beverage, pharmaceuticals, packaging, electronics, materials handling, and logistics. Their extensive range includes award-winning sensors, wireless systems, machine safety equipment, indication devices, and LED lighting.
Banner's supply chain is not viewed as a cost center but as a strategic advantage. By leveraging a network of 5,000 engineers and support personnel, Banner has built a 360-degree view of its ecosystem. This finely tuned machine allows them to recombine ideas, technologies, and processes while continuously delivering value. It's this interconnectedness—between customer needs and supplier capabilities—that enables Banner to stay ahead of the competition, not just today but in the uncertain future that lies ahead.
The company's engineering prowess is a key factor in its success. Banner designs and engineers products that create a preferred customer lifecycle experience. Their ability to combine and recombine with speed, quality, consistency, and support is unparalleled. Design engineering and orchestrating the supply chain have become Banner's competitive advantage.
Banner's approach to innovation is about velocity—the ability to accelerate innovation, design new solutions, and respond to customer needs at a speed unmatched by their competitors. This is the secret of supply chain mastery. It's not just about being fast or efficient; it's about seeing the interconnections and using that visibility to continuously create new products and services with velocity.
Banner's global impact is significant, with operations on five continents and a worldwide team of over 5,500 employees and partners. In fact, a Banner product is installed somewhere in the world every two seconds. The company's commitment to personalized service and attentive support, offering both face-to-face and virtual interaction with customers, has helped them solve tough applications and advance manufacturing processes globally.
Banner Engineering's success stems from its ability to embrace variability, harness visibility, and compete on velocity. By leveraging their engineering knowledge and relationships with customers and suppliers, Banner continues to innovate and provide cutting-edge automation solutions for manufacturers worldwide.
TraceGains' success can be directly tied to empowering manufacturers to embrace variability through their massive catalog, which allows them to rapidly increase the velocity of product introduction and their ability to harness visibility and embrace variability, enabling a high-velocity "ingredients to product" supply chain. The company has positioned itself as a de facto standardizer of processes and methods for sourcing, building trust that allows its ecosystem to rapidly source, assemble, and reassemble ingredients-based products with unmatched velocity, quality, and process assurances.
Founded in 1998 and headquartered in Westminster, Colorado, TraceGains has emerged as a pioneering force in the food and beverage industry. The company's innovative platform provides a 360-degree view of a hyperspecialized ecosystem, connecting ingredients manufacturers with consumer product manufacturers across a vast network of 75,000+ supplier locations and 525,000+ ingredients/items.
TraceGains' supply chain network serves as both a graph and an intersection point, mapping suppliers against product requirements, quality credentials, and manufacturer pedigree requirements. This comprehensive view forms the foundation of the company's competitive moat, providing unparalleled insights and capabilities to its clients.
The power of TraceGains' platform is exemplified by its approach to ingredient taxonomy. For instance, an ingredient as seemingly simple as garlic is meticulously categorized within their network, from raw and organic to processed, chopped, and packaged in specific container sizes. This granular level of detail enables precise matching and sourcing capabilities.
TraceGains' intelligent network continuously monitors global events through “horizon scanning,” tracking adverse events, import refusals, and recalls. This real-time intelligence allows customers to remain informed about issues relevant to their specific ingredient needs, avoiding unnecessary concerns about unrelated incidents.
A key strength of TraceGains lies in its commitment to standardization and curation. Working closely with large customer advisory groups, the company has developed standardized data formats for numerous forms and data types, including allergens, nutrition, sustainability, and supplier and item risk assessments. This standardization significantly reduces friction in the supply chain, as suppliers can enter data once in a standardized format, which then automatically propagates to all their customers on the network.
TraceGains rapidly accelerates the velocity its customers can source, assemble, and reassemble its products. By leveraging artificial intelligence and standardizing data across its network, TraceGains enables manufacturers to source, assemble, and reassemble products with unprecedented speed and precision. The company's approach transforms potential chaos into order, using the power of its supply chain network to anticipate disruptions and act proactively.
Their supply chain’s main strength? Turning chaos into order. TraceGains has turned variability into its greatest strength, enabling a supply chain that is as agile as it is reliable and capable of meeting the unique demands of each customer while sourcing from the most appropriate suppliers with the highest fidelity at velocity.
Altana enables its customers through its supply chain network to embrace variability by providing a digital, dynamic, universal global supply chain map. By harnessing visibility through its federation, Altana allows for the standardization of multi-party workflows, enabling companies to combine, recombine, monitor, and surveil their supply chain at high velocity.
Founded in 2018 and headquartered in New York City, Altana has emerged as a force in supply chain network management by operating on an even larger scale, connecting governments, logistics providers, and businesses around the globe through a federated system of supply chain intelligence, offering unprecedented visibility and insights into global value chains.
Central to Altana's innovation is its proprietary "federated learning" architecture. Unlike traditional centralized data models, Altana has pioneered a decentralized, "hub-and-spoke" approach. This revolutionary design allows customers to share intelligence without ever exposing their underlying data, thereby maintaining data sovereignty, privacy, and security for all participants in the network.
The Altana “knowledge graph” is a testament to the power of this approach. It now comprises more than 2.8 billion shipments, tracking over 500 million companies and 850 million facilities down to the part-site level, with more than 125 million distinct facility-to-facility relationships. This vast network creates a common operating picture of the world's interconnected supply chains, spanning across governments, logistics providers, financial services companies, and other associated service providers.
Altana's Value Chain Management System enables real-time visibility into supply chains that cross borders and industries. For instance, a top global retailer uses Altana to understand potential upstream exposure to forced labor in its value chains, ensuring compliance with the Uyghur Forced Labor Prevention Act. Simultaneously, U.S. Customs and Border Protection (CBP) uses the same system to enforce this law, while logistics giants like Maersk utilize it to model global value chains for the shipments they handle.
This interconnected ecosystem allows for unprecedented coordination and streamlining of compliance and enforcement activities. Parties that would otherwise be unable to share data due to fragmentation, silos, and interoperability issues can now view the same network relationships, remediate compliance exposures, and act collaboratively to facilitate trusted trade and avoid disruptions at borders.
The impact of Altana's innovation extends far beyond individual companies. By creating a shared source of truth for global supply chains, Altana is helping to recalibrate and rebuild secure and trusted supply chains on a global scale. This approach aligns with key principles of supply chain network competitiveness: embrace variability, harness visibility, and compete with velocity.
My industry ICONS have turned their supply chain networks into competitive weapons. They’ve learned that variability is not a hindrance but a source of strategic advantage. Through their supply chain networks, they enable their customers to embrace variability, harness visibility, and compete on velocity, which is what sets them apart. Like a finely organized complex adaptive system, they have curated and cultivated their hyperspecialized networks to achieve something competitively differentiated.
Banner Engineering, TraceGains, and Altana use their supply chain networks and 360-degree view to a strategic advantage. Their relationships and knowledge of their federations' capability and capacity define their strategic positions, and their ability to harness surveillance and enable rapid recombinant behavior creates their moats.
The companies that will dominate the future understand that success is not just about making the right tactical decisions on a day-to-day basis; it’s about building the infrastructure that allows you to evolve and adapt to tomorrow’s challenges. Banner Engineering, TraceGains, and Altana are not just companies—they are supply chain ICONs. Shining examples of what can be achieved when you embrace variability, harness visibility, and compete on velocity.
They are, in every sense, flying above the fray.
