
There are few people that have had such a profound impact on world history as Sir Winston Churchill. A personal hero of mine, Churchill was an inspirational statesman, writer, orator and leader who led Britain and her allies to victory in the Second World War.
Churchill was an enduring optimist, who believed in duty, hard work and a never say never attitude. In my humble opinion, it was his passion and total belief that ultimately freed Britain, and Europe, from the grip of the gestapo.
An accomplished writer and orator, he was renowned for many sayings that summarized his philosophy and outlook on things. One of these, was the phrase “keep buggering on” – a phrase used to encourage people to keep going, even when faced with overwhelming odds. Churchill believed that to achieve one’s goal, you need to “keep buggering on” – never giving in and continuing the journey until you reach your goal.
I’d like to share a true story of my colleague, Andre Martin, who – for roughly 50 years – has “kept buggering on” to realize his dream of a completely connected, seamlessly integrated supply chain from consumption to source; what we call Flowcasting.
To begin, let’s turn the clocks back to 1974. Andre has a huge problem on his hands as the Director of Manufacturing and Distribution at Abbott Labs in Montreal, Canada. He’s getting beat up about and trying to understand why the service levels in Similac (an infant nutritional product), and others, are dismal. They hover around 90% or so, but the target is 98%, or better. To make things worse, his manufacturing and distribution folks are at loggerheads and often in a fight.
Andre recalled a Jay Forrester article entitled “Industrial Dynamics” written in 1958 and decided what was needed was an inventory planning system that connects and manages 4 separate levels of inventory – their 10 regional DC’s supplied by a central DC, which was supplied by 3 factories which were supplied by multiple vendors.
About the same time a colleague recommended that he attend an Oliver Wight MRP seminar in Boston – which he did and where he met Oliver Wight. Soon after he would retain Oliver Wight in a consulting capacity. Andre would share his idea how he was thinking of planning production and synchronizing purchases with suppliers using the principles of MRP. Given that Abott had two more levels of inventory to manage, what Andre concluded was that he needed a four-level planning system that would integrate all levels.
Ollie liked the idea and agreed with the concept but informed Andre that no such software system existed in the market. To realize his design, he would need to develop it himself but could count on Ollie’s support and guidance should he choose to do so.
In fact, Oliver Wight informed Andre that he knew a person that could help develop the new software and introduced him to a young dude named Darryl Landvater. Two days later Darryl visited Montreal to work with Andre and began the journey to develop the very first integrated DRP/MRP solution – connecting distribution and manufacturing into an integrated system.
Once designed and implemented, the results were phenomenal! Service levels increased to 98-99% consistently, inventories were reduced at all levels by 25-60%, obsolescence was down by 60% and the cost of production fell by 15% as well.
Given the success of this initiative, Andre continued to think about seamlessly integrating any industrial supply chain. At the 1975 APICS conference in San Diego, California, he’d confirm his thinking. He had been pondering about an integrated supply chain driven from store-level to supplier using the principles of what they implemented at Abbott Labs. His breakthrough idea was that he flipped the MRP concept of a bill of material and instead created a bill of distribution – so the integrated supply chain could be driven by only one forecast.
At the conference he’d bump into and discuss this idea with the legendary Dr. Joseph Orlicky, the father of Material Requirements Planning (MRP) and a planning guru. Upon hearing Andre’s idea, Joe thought about it for a few minutes, then responded in a profound manner. “Andre”, he said, “your idea is sound, because you should never forecast what you can calculate.”
Not long after his success with Abott Labs and the DRP/MRP integration, Andre would join the Oliver Wight organization to help take DRP mainstream, including writing the seminal DRP book and later a book called “Infopartnering”. During his time at Oliver Wight, he would help lead the successful implementation of DRP with more than 40 companies – helping to cement the principles of DRP in distribution and manufacturing.
He then decided that the thinking should be taken to retail. To that end he would work with early retailers like Sears to help them implement DRP for their distribution operations, including early pilots of supplier scheduling in retail – i.e., sharing time-phased shipment projections with merchandise suppliers.
He would re-join forces with Darryl and create the Retail Pipeline Integration Group, focused on helping retailers embrace these concepts and drive their entire integrated supply chain from a forecast of consumer demand at the store level. They would help several retailers, including my team at Canadian Tire, and dabble in determining what was needed to build a retail focused solution capable of enabling Flowcasting – including how to process the massive volumes in retail and the retail specific planning challenges, like managing slow sellers as an example.
Based on their learning regarding a retail-focused solution during their initial prototypes and pilots, they would visit several large planning solution providers to convince them that a retail solution would be needed. All the major players declined to build one. So, given they were both committed to the cause, they decided to build a solution themselves. It’s a solution that has eventually found a home with the Oliver Wight Group – ironically the organization where the ideas, thinking and concepts of integrated planning largely originated.
In terms of the Flowcasting concept, early pilots and implementations have proved, beyond a shadow of a doubt, that Andre was correct in his initial thinking regarding an integrated supply chain. In retail, the entire supply chain for early adopters is driven by only a forecast of consumer demand and all other demands are calculated – providing all partners a model of the business and the ability to work in harmony using a single set of numbers.
Andre is retired now, but he still interacts with me and the original Flowcasting pioneers to share his wisdom and talk a little smack about hockey (btw, Andre, the Leafs are better than the Canadiens, at least for now).
I suppose that I’m now one of the ones that will continue to drive the thinking and adoption of the principles and concepts of Flowcasting. Which reminds me of another famous Churchill quote to help inspire us; “Never give in. Never, never, never, never—in nothing, great or small, large or petty.”
Don’t worry, we won’t, so when it comes to Flowcasting adoption…
We’ll “keep buggering on”.