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The 2014 MHI Annual Industry ReportInnovations that drive supply chains

What executives think about emerging innovations that could dramatically impact tomorrow’s supply chains…and the barriers to adoption

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Supply chain executives understand the need to capitalize on powerful new technologies and business innovations that can help address and manage the increasing complexity of today’s global supply chains. In the past, companies tackled supply chain challenges primarily by focusing on internal cost reduction and improved operational efficiency. However, those traditional approaches are losing their effectiveness as supply chains become longer and more intricate, with more inter-connecting links, higher stakeholder expectations, and more sources of risk. This increasing complexity is forcing companies to rethink their approach to supply chain improvement.

In late 2013, MHI and Deloitte conducted their first MHI Annual Industry Report survey. The topic of this survey was “Innovations that Drive Supply Chains” and the goal was to provide an up-to-date perspective on emerging supply chain trends. The survey included more than 450 respondents from large and small companies across a wide range of sectors, including: Retail and Wholesale, Consumer Packaged Goods, Automotive, Consulting, Life Sciences and Healthcare, Transportation and Warehousing, Material Handling and Supply Chain Equipment and Related Services. The vast majority of respondents were senior executives, with more than half being C-level executives, Managing Directors, Senior Vice-Presidents, Vice-Presidents, or Directors.

According to our survey, the top two strategic priorities for supply chain executives are Supply Chain Analytics and Multichannel Fulfillment.

• Supply chain analytics. Analytics tools and techniques harness data from a wide range of internal and external sources to produce breakthrough insights that can help supply chains reduce costs and risk while improving operational agility and service quality. At many companies, the supply chain function is a step or two behind the commercial side of the business when it comes to capitalizing on the power of analytics.

• Multichannel fulfillment. Today’s consumers want to shop for what they want, where they want, when they want — and then have all of their purchases delivered quickly and consistently, whether their timeline is next day or even same day. Although many retailers now do a decent job on the front end handling orders through their various channels — retail, wholesale, and online — many are still struggling to adapt their back-end fulfillment processes.

Executive summary

As used in this document, “Deloitte” means Deloitte Consulting LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

The 2014 MHI Annual Industry report Innovations that drive supply chains 3

The survey also revealed two major barriers to development and adoption of supply chain innovations.

• Talent shortage. To capitalize on the latest innovations, companies need supply chain talent with the right skills, experience and mindset: people with deep business and supply chain knowledge who are also willing and able to apply new tools and methods. Unfortunately, finding qualified workers is already at a crisis point with baby boomers starting to retire and a scarcity of younger workers to replace them. And with the supply chain field expected to add 1.4 million new jobs by 2018, the issue will likely only increase in intensity.

• Continued focus on cost reduction. Over 70% of respondents say that “controlling costs” is a top priority, making it the #1 focus area for supply chain executives. However, this singular focus might now be working against them, choking off investment in essential innovations that are the key to long-term growth, performance and efficiency. Although most respondents expect to increase their supply chain investments over the next three years, in many cases it will be just enough to get by and not nearly enough to drive disruptive innovation and competitive advantage.

Three emerging innovation areas are not yet top of mind for executives…but may be soon.

• Sustainability. Four out of five respondents say supply chain sustainability is at least “moderately important.” However, over 60% of respondents admit to significant capability gaps that may be preventing them from implementing and fully benefitting from sustainability initiatives. Leading companies are adopting a holistic approach as they start to recognize that sustainability is as much about increasing the value of their overall brand as it is about the ROI of individual projects.

• Mobile and machine-to-machine (M2M) technologies. Companies of all shapes and sizes are beginning to apply these technologies to their supply chains — but at this early stage the large majority (70%) report significant capability gaps. Looking ahead though, 73% of companies plan to continue investing in this area, and nearly half expect their investments to increase over the next three years.

• 3D Printing. Additive Manufacturing — popularly known as “3D Printing” — is getting a lot of attention as a technology that could transform supply chains by localizing production and enabling just-in-time manufacturing. However, there is a big gap between future vision and current reality. According to our survey, only 17% of respondents view 3D Printing as a strategic priority, while 70% say they are not sure about its future impact. That being said, the technology has clear potential and companies should follow it closely and be prepared to invest quickly as the technology matures and additional applications become available.

This report takes a closer look at these strategic priorities, major barriers and emerging innovation areas, and offers data-driven insights on how they are shaping supply chains of the future.

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Strategic prioritiesAccording to our survey, supply chain analytics and multichannel fulfillment are the top strategic priorities for today’s supply chain executives.

Supply chain analyticsPossibly no other business area is changing faster than analytics. From big data and visualization to predictive modeling and more, analytics encompasses a rapidly evolving world of technologies and tools that are changing the face of supply chain management. Using the latest analytics tools and techniques, supply chains can harness data from a wide range of internal and external sources to produce breakthrough insights that help reduce costs and risk while improving operational agility and service quality.

The executives we surveyed recognize the importance of analytics and view it as the top strategic priority for supply chains, with nearly 80% rating it as “very important” or “moderately important.” Most also plan to increase their investments in this area. That’s a good thing, since our experience shows that at many companies the supply chain side of the house is a step or two behind the commercial side when it comes to tapping the full power of analytics.

Investing in analytics can help leading companies gain competitive advantage by being more predictive and forward-looking with both external and internal information. This is especially important as supply chains become more expansive and complex. Analytics can help companies tame the complexity and unearth hidden value for the business.

For example, visualization is an analytics technique more and more companies are applying to logistics and supply chain management. Companies can now create “control towers” that provide pro-active visibility into global events along the supply chain by portraying vast amounts of data visually to reveal insights into shipping patterns. This provides better insight into material flow, and enables trade lane managers to respond more quickly and holistically to unplanned events.

A convergence of forces is helping to expand the possibilities for supply chain analytics:

1. Data proliferation. The amount of data available for analysis — especially supply chain data — is growing quickly.

2. Cheaper data storage. From 2000 to 2008, storing a MB of data became 100 times less expensive.

3. Faster processing power. Processing speed has increased 256 times since 2000.

4. Anywhere, anytime connectivity. Mobile data is now available almost everywhere.

5. Better tools. Innovative tools make sophisticated analysis simpler and more cost effective.

6. Advanced visualization. New tools and techniques help show patterns in huge volumes of data.

Despite the advances in tools, companies should start by focusing on desired outcomes — specific supply chain areas that can dramatically benefit from analytics — and then work backwards to figure out what tools and data are needed to support those outcomes.

In our experience, Logistics and Sales & Operations Planning are two of the leading places to begin since they can both benefit from the forward-looking capabilities of analytics, as well as from the broader perspective provided by external data such as demographic trends and consumer buying patterns. Risk management is another prime opportunity area, for similar reasons. Analytics can also be a useful tool for reducing costs and improving efficiency — not only as a way to generate short-term savings, but also to support strategic decisions that can make a supply chain network more cost-efficient and agile over the long term.

Key findings

Competitive

advantage

Optimization algorithms

Simulation and modeling

Advanced forecasting

Predictive andprescriptive

Moreforward-looking

Role-based performance reporting

Exceptions and alerts

Slice and dice queries and drill downs

Descriptive anddiagnostic

Morebackward-looking

Information management Table-stakes

Figure 1: The analytics spectrum


Figure 2: Supply chain analytics — The art of the possible

Supply chain challenge How leaders are using analytics to solve supply chain challenges

Margin & asset optimization

An Oil & Gas company applied advanced mathematical techniques to quantify critical differences in drilling performance and costs, and identify underlying drivers

Event-driven risk management

A large Industrial Products company designed ongoing monitoring of supplier risk, leading to improved visibility and assurance of uninterrupted material flows from supplier to point of use

Product visibility

A Life Sciences company used analytics to improve supply chain traceability and serialization capabilities, and to administer recalls

Demand planning

An Aerospace and Defense manufacturer used advanced visualization and simulations to reduce material shortages and improve planning around ballooning product lead times

Business relationship management

A large Global Retailer combined multiple data sources into a single visualization platform to optimize relationships with trading partners and manage supplier risk, performance and compliance

Functional integration

An Appliance Manufacturer leveraged predictive analytics to identify warranty cost reduction opportunities by predicting likely product failures

Multichannel fulfillmentToday’s consumers want it all. They want to shop for what they want, where they want, when they want — and then have all of their purchases delivered seamlessly on a consistent timeline (whether the timeline is next day or even same day delivery). Companies and supply chain executives are working hard to achieve the vision and fulfill the promise of a consistently excellent multichannel experience. However, historically many online and brick-and-mortar channels have operated with different merchants, different offerings, and separate P&Ls — with supply chain being one of the few areas that served both channels.

Online fulfillment is the fastest growing segment in retail. In fact, some traditional retailers are actually seeing same-store sales decline while their online business is exploding. Although many retailers now do a decent job on the front end handling orders through all of their various channels — retail, wholesale, and online — many have been slow to adapt their back-end fulfillment processes.

Trying to serve individual consumers with existing distribution networks that were designed for high-volume store replenishment is far from optimal. Likewise, trying to fill online orders using store inventory is also less than ideal, since many retailers run into practical issues such as having busy store associates struggle to locate items because they lack accurate visibility into store inventory.

One consumer’s real-world experience with multichannelA consumer ordered a set of dishes over the Internet from a retailer with multichannel operations that include brick-and-mortar stores as well as a direct-to-consumer online ordering process.

One dish was shipped from a store in flimsy packaging. Another dish was shipped from a distribution center in sturdier packaging. The remaining dishes were shipped from an e-fulfillment center in yet a third kind of packaging.

The consumer ended up receiving three different shipments, packaged three different ways, on three different days. That’s a far cry from the seamless multichannel experience today’s retailers are striving to deliver.

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The vast majority of retailers we surveyed (over 90%) plan to continue investing in multichannel capabilities, and 74% expect their investments to increase over the next three years. To support this growth, companies that provide the material handling equipment and software to execute in a multichannel environment expect a similar increase in their own investments.

Of course, even with adequate funding and investment, achieving the vision of multichannel fulfillment is no easy task. According to the executives we surveyed, the top three challenges are:

1. Controlling the cost-to-serve2. Optimizing the distribution network footprint3. Integrating technology solutions and systems across

functions and channels.

Emerging solutions range from distributed order management systems that allow fulfillment from multiple locations, to robotics in distribution, to fully integrated, highly automated fulfillment centers that can pick both brick-and-mortar store orders and individual consumer orders.

For many retailers, the ultimate goal is not just multichannel fulfillment, but omnichannel fulfillment in which all channels are fully integrated and operate as a single unit. Such a shift will require flexible and agile supply chains that use innovative material handling equipment and processes such as wearable technology, driverless vehicles, and sensor gear. This type of equipment and technology could easily be adopted in the back room of stores — not just in distribution centers — which would have a dramatic impact on the traditional retail environment. A recent collaborative report by MHI entitled, “The US Roadmap for Material Handling and Logistics” (aka, the “MHL Roadmap”) reinforces this industry shift.

Automated storage and retrieval systems

Automated active pick processes

Flow-through processes (receiving to shipping cross-dock, reserve to packing)

High-speed sorting — including a tilt tray sorter

Figure 3: State-of-the-art warehouse management system (conceptual illustration)In 2014, one of the world’s largest footwear companies will finish constructing and open a true omnichannel fulfillment center — a key component of the value chain.


Distribution operations should move beyond flows that receive product and then slowly route it through various processes — from reserve to active to packing and shipping. In today’s fast-paced retail environment, products must be able to flow freely from receiving to shipping at high velocity. Traditional wave picking may soon be replaced by wave-less operations that more closely resemble tidal waves in terms of volume and velocity.

A shift to omnichannel will likely not only require operational changes to the supply chain network, but also changes to how performance is measured and rewarded — with a shift away from individual store and channel metrics to a more enterprise-wide perspective.

Barriers to innovation and adoptionAccording to our survey, a shortage of talent and a continued focus on cost reduction are the two major barriers preventing companies from adopting the latest supply chain innovations.

The talent shortage barrier to innovationThe biggest single barrier to harnessing the value of supply chain innovations is a shortage of talent. In order to implement and capitalize on the latest supply chain innovations, companies need talent with the right skills, experience and mindset: people with deep business and supply chain knowledge who are also willing and able to apply the latest tools and methods.

Unfortunately, the right kind of supply chain talent is extremely difficult to come by these days as companies look to fill jobs in traditional areas such as material handling and logistics, while also looking for people with new skillsets such as contemporary information, technology, and systems. What’s more, the MHL Roadmap predicts that the problem will get worse over the next several years as demand for supply chain workers rises dramatically.

One of the overarching themes of the MHL Roadmap is the industry’s heavy reliance on people — and the looming shortage of the right ones. Finding qualified workers is already at a crisis point with Baby Boomers retiring and a dearth of younger workers to replace them. And with the supply chain field expected to add 1.4 million new jobs by 2018, the issue will only increase in intensity.

Older staff typically have the required supply chain knowledge and experience but tend to be less receptive to new tools and methods. Younger staff are generally comfortable with new tools and methods but are likely to lack the required knowledge and experience. The problem is particularly acute in the middle management ranks, where having the full set of required capabilities is essential for translating strategy into action.

MHI has been focusing on the talent shortage for years and working with the trade to provide resources to address this critical issue. One key resource is MHI’s College Industry Council on Material Handling Education (CICMHE),

“What seems clear for the industry is the need for omnichannel operations, in which the distribution center can provide same-day and next-day service alongside ordinary replenishment and other operations — very challenging. Order-to-ship response times will be the new metric for distribution center design and operations.”

Kevin Gue, Editor-in-Chief, U.S. Roadmap for Material Handling & Logistics

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which addresses the needs of professors and students in four-year university-level programs. Also, MHI and the Material Handling Education Foundation, Inc. (MHEFI) have jointly developed the Technical Career Education Program (TCEP), which is helping to build the workforce of tomorrow by developing curriculum and textbook materials for training programs at the high school, vocational-technical school and community college levels.

For individual companies, the first step to addressing short- and long-term talent challenges is to develop comprehensive talent strategies. Companies should assess their current workforce and predict what the organization will need to look like in three to five years based on the pace of innovation and expected attrition. After that, they should identify the right kinds of talent to recruit or develop — taking into account the specific skills required to fill each gap area — and then identify the leading sources for that kind of talent.

A number of leading companies have begun to conduct formal skills assessments that combine quantitative skills testing with qualitative feedback — not to weed out weak performers, but to better understand the organization’s gaps and future needs.

Other solutions include training older workers on the latest tools and innovations, as well as providing younger workers with mentoring and rotation programs to help them build experience more quickly. There may also be opportunities to shift older resources into new innovation areas that can benefit from their experience.

In highly specialized areas such as analytics, a team approach to talent is proving to be more practical than holding out for individuals with the full mix of leading-edge technical knowledge and deep business experience. According to a recent Deloitte report entitled “Analytics Trends 2014,” more and more companies are “mixing and matching professionals to deliver a balanced response to business analytics questions.”

Recruiting and developing the right kind of talent will likely require an incremental investment, which is something many companies are reluctant to do given the constant pressure to cut costs. However, the investment will likely pay for itself many times over by enabling a company to capitalize on innovations that can take its supply chain performance to the next level.

The MHL Roadmap presents a highly collaborative approach that could also help address the talent issue. “One way to think of the potential here is to think about ‘economy of scale’ in a different way,” said Dr. Kevin Gue, associate professor of engineering at Auburn University and editor-in-chief of the MHL Roadmap. “We're used to thinking of an individual company realizing cost benefits through economies of scale by growing its business or by acquiring another company. Now imagine the potential economies of scale if all companies were to collaborate and leverage the training programs already available. But I don't think all companies have to sign on for the big gains to be realized. Even localized initiatives of a few or several companies could produce big savings.”

The cost reduction barrier to innovationOur study showed that cost reduction is still the #1 concern for many supply chain executives. Over 70% of respondents across industries say that “controlling costs” is a top priority. However, that singular focus might now be working against them, limiting investment in essential innovations that are key to long-term growth, performance and efficiency.

“Multiple factors are contributing to the talent shortage, including an aging workforce and the negative perception of manufacturing and supply chain jobs among the younger demographic. However, the biggest factor is the changing skill set required for today’s supply chain jobs.”

George Prest, CEO of MHI


At the same time, companies appear to be under-valuing the strategic importance of investing in new technology areas such as supply chain analytics — and critical capabilities such as supply chain agility and multichannel fulfillment could be getting lost in the shuffle. If a focus on cost reduction prevents a company from adequately investing time, money and effort in other critical areas, it may soon find itself in a downward spiral of declining performance and competitiveness relative to other companies in its industry.

Over two-thirds of the companies we surveyed expect their supply chain investments to increase over the next three years; however, in many cases those investments will be just enough to get by and not nearly enough to drive disruptive innovation and competitive advantage.

Commitment to supply chain investments seems to be highest among “Retail and Wholesale and “Transportation and Warehousing” companies, with close to 75% of companies from these sectors expecting to increase their supply chain investments, and almost 95% expecting to at least maintain their current levels of investment.

Emerging innovation areasThree emerging innovation areas — sustainability, mobile/machine-to-machine technologies, and 3D printing — could have a dramatic impact on future supply chains. These innovations are not yet top-of-mind for supply chain executives, but may be soon.

SustainabilityIn our survey, four out of five respondents say sustainability is at least a “moderately important” supply chain initiative. Transportation and Warehousing, Consumer Products, and Retail Industry respondents are leading the way, and are more likely to have company-wide programs to reduce environmental impacts. Also, they are more likely to use alternative sources of energy, track the impact of their programs, and have a clear ownership and governance process.

Manufacturers and retailers are looking to reduce supply chain waste through more fuel-efficient vehicles, optimized packaging, and greater use of renewable energy sources. Material handling companies are designing equipment to meet these needs.

However, over 60% of respondents admit that significant capability gaps exist at their companies, customers and clients that may be preventing them from implementing and fully benefitting from sustainability initiatives.

According to our survey, the two top barriers to implementing supply chain sustainability initiatives both center around cost. The first barrier is the traditional and continued focus on cost reduction, which diverts time, attention and resources away from sustainability. The second barrier is the actual cost of implementing sustainability initiatives.

A third major barrier for the companies we surveyed is the “inability to measure benefits of sustainability initiatives.” And while it’s true that many of the benefits associated with sustainability can be difficult to quantify, in our experience the tangible cost savings and operational efficiencies resulting from sustainability initiatives are in and of themselves generally more than sufficient to justify the investment — meaning that the important intangible benefits are essentially a free bonus. Sustainability initiatives and the resulting benefits typically have a very direct tie to cost savings. Also, it’s relatively easy to do the math and calculate the savings associated with reducing greenhouse gas emissions savings.

“A focus on cost without an appreciation for environmental impact, resource availability and social factors exposes supply chains and brands to increased risk. Best-in-class supply chains and major brands have made measuring green efforts one of their top priorities. And they’re seeing significant positive environmental and bottom line impacts.”

George Prest, CEO of MHI

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Our experience shows that companies on the leading edge of supply chain sustainability actually think about the issue differently today than they did several years ago. Before the global recession, sustainability was an emerging hot topic as companies began to realize that pursuing efficiencies in supply chain could also produce environmental benefits; however, the focus back then tended to be on sustainability initiatives as individual projects.

Now, leading companies are starting to recognize that sustainability is as much about increasing the value of their overall brand as it is about the ROI of an individual project. These organizations are finding that capturing and maintaining customer and consumer loyalty through sustainability initiatives can help improve performance on the top line as well as the bottom line. At the same time, a growing number of large, sustainability-conscious companies are asking their logistics providers to report data on fuel use and GHG emissions, which can also have a positive ripple effect on sustainability.

A well-defined business case that shows the positive trade-off between short-term profitability and long-term brand and shareholder value can go a long way in motivating companies to make their supply chains more sustainable.

Mobility and machine-to-machine technologyMobility and machine-to-machine technology (M2M) are emerging as key supply chain enablers. Mobility and M2M can improve responsiveness and customer service by providing supply chain workforces with the information they need — whenever and wherever they need it.

Some of the associated technologies have been around for a while (e.g., bar coding, image scanning, voice data collection and RFID). However, until recently their use was often limited to companies at the leading edge of supply chain innovation. Now, our study shows that M2M and mobile supply chain applications are becoming increasingly common at companies of every shape and size. What’s more, as the ecosystems mature, implementing the technologies and their associated applications will likely become more cost effective — further driving adoption.

Many companies are starting to view this as a strategic issue, with over half of our respondents rating supply chain mobility and adoption of M2M technologies as ”very important” or “moderately important.” Primary focus areas include Warehouse Operations, Inventory Management and Transportation.

Since mobile and M2M technologies are still in the early stages of supply chain adoption, it’s not surprising that roughly 70% of respondents currently suffer from significant capability gaps that are preventing them from fully capturing the benefits of this innovation. However, 73% of companies plan to continue investing in this area, and nearly half expect their investments to increase over the next three years.

Companies are also investing in related talent. Many respondents say they plan to implement mobile and M2M training programs for their supply chain workforce. And in the Retail and Wholesale, Transportation and Warehousing, and CPG sectors, nearly 20% of companies plan to supplement their training initiatives with external hiring to bring more mobile-savvy talent into the organization.

Figure 4: Sustainability — The art of the possibleLeaders are adapting and being rewarded.

A food & beverage company designed coffee refill packs that weigh over 90% less per gram than typical glass jars, reducing packaging and transportation cost

A consumer packaged goods company sells scrap dental floss to firms that make industrial spill cleaners; hair care manufacturing waste is sold to firms who make bricks

A consumer packaged goods company created a shampoo that is applied dry and rinses off in a third of the time in order to minimize water use in arid countries

A multi-national consumer goods company in India achieved a positive water balance in order to accommodate local water needs

An outdoor clothing provider communicates directly to consumers about the energy, carbon dioxide, and waste involved in producing each product

A large retailer has been using a sustainability scorecard with its suppliers in order to achieve its own footprint reduction goals


According to our survey, the biggest challenges are integrating mobile applications with existing infrastructure and across value chain partners. Many existing applications were developed for specific uses and do not provide integrated end-to-end solutions that would help drive adoption. However, integration is a common challenge for emerging technologies and is likely to be addressed over time as the ecosystem matures and application providers improve their offerings. Looking ahead, it is likely mobile and M2M technologies will produce their greatest value when combined with business analytics. This powerful combination has the potential to enable real-time decision-making and deliver major breakthroughs that could make supply chains far more dynamic and efficient.

3D PrintingAdditive Manufacturing — popularly known as “3D Printing” — is getting a lot of attention as an innovative technology that could revolutionize production processes and have far-reaching future implications for product supply chains. It involves manufacturing or “printing” a three-dimensional object using a computer-controlled laser that melts plastics or alloys according to a digital blueprint.

Many industry watchers are already talking about a future where 3D Printing could localize production and improve supply chain efficiencies by reducing waste and enabling just-in-time manufacturing. However, there is a big gap between the future vision and how executives in our study view the immediate potential for this innovation. According to the survey results, only 17% of respondents view 3D Printing as a strategic priority, while 70% say it is not a key consideration and they are unsure about its future impact.

Many experts and analysts are excited about the future of 3D printing, and the medical device examples of using 3D printing for prototypes and final products illustrate the technology’s potential to create leaner, more cost efficient supply chains that reduce offshore manufacturing and minimize inventory. However, most business executives in our survey are not yet convinced it will have a significant impact on supply chains in the near to medium term. That being said, companies should keep a close eye on this rapidly evolving technology and prepare to invest quickly when the technology matures and additional practical applications become available.

Figure 5: Mobility and M2M — The art of the possible

Appication How leaders are using mobility and M2M within supply chain

Clinical lab delivery tracking

Managing pickup, delivery, and location of specimens sent to clinical labs for testing (as well as the supplies and the drivers of those vehicles) in real time.

Medical equipment delivery

Managing pickup and delivery of medical equipment and supplies to be distributed to healthcare facilities such as clinics and hospitals.

Food distribution Managing distribution of food orders from pickup and delivery to invoicing. Specifically, the ability to split pallets at the point of delivery, and truck mapping (essentially a mini-Warehouse Management System that tells the driver which area of the truck to pick from).

Auto parts manufacturing and distribution

Tracking movement of materials on the shop floor to ensure timely delivery of items from manufacturing unit to distribution center to customer. In auto parts distribution, Service Level Agreements are very strict and it is very expensive to stock every part at every location. A mobile solution is capable of tracking a part to the nearest location (whether retail or distribution center).

Figure 6: 3D printing — The art of the possible3D printing has had the greatest impact in the manufacturing of objects with complex designs that need heavy customization based on customer need. It is already being used heavily in the Class II and III medical devices industry.

Category Current 3D printing applications and real-world uses

Dental devices

Dentists use 3D printing to design and produce custom-fitted braces, bridges, caps, crowns, and dental appliances

Aircraft parts

Mechanics use 3D printing to design and produce fighter jet components and parts on the spot to reduce maintenance costs

Children’s toys

Children create their own toys with the option to 3D-print or order them from on-line partners after passing safety checks

Food and candy

Consumers use sugar and cocoa butter rather than plastics in 3D printers to produce various foods including candy, pizza and ravioli

Orthopedic/Other

Doctors produce body braces, bone grafts, hearing aids, hips, orthopedic insoles, prosthetic eyes, prosthetic noses and skin

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Conclusion — Driving value with supply chain innovationThe strategic priorities, barriers and emerging innovations highlighted by our survey are the forces shaping supply chains of the future, and they have significant implications for how companies design and manage their supply chains. The executives we surveyed clearly recognize the strategic importance of supply chain innovation, yet they also acknowledge the challenges in getting these innovations approved and adopted within their organizations.

According to the survey data, the single biggest barrier to supply chain innovation is a shortage of qualified talent. Companies need people with the knowledge, skills, experience and mindset to understand and adopt these breakthrough innovations. To overcome the talent gap, companies should have comprehensive talent strategies that not only assess the current workforce, but anticipate what the organization’s needs will be in three to five years given the rapid pace of innovation. The strategies should include a list of the right kinds of talent to recruit and develop — taking into account the specific skills required to fill each gap area. Effective talent strategies are likely to include new approaches such as:

• Conducting formal skills assessments

• Testing for quantifiable capabilities and seeking qualitative feedback to better understand gaps and future needs

• Training older workers on the latest tools

• Providing younger workers with mentoring and job rotation programs

• Shifting older resources into new innovation areas

• Adopting a team approach to talent deployment in specialized areas such as analytics

Another major barrier is the continued focus on cost reduction, which may be choking off essential investments in supply chain innovations that are the key to long-term growth, performance and efficiency. To overcome this barrier, companies should take a holistic approach to supply chain innovations, treating them as integral parts of a comprehensive program, rather than focusing on the ROI of individual initiatives. This is truly a case where the whole is greater than the sum of its parts.

Supply chain executives should also find ways to communicate the value and impact of innovation on financial performance. Companies that fail to invest in and harness supply chain innovation could find themselves struggling to compete in an increasingly demanding marketplace.


This section takes a closer look at the survey data, with insights and expert observations from MHI and Deloitte. The detailed findings are organized around five hot topics that could have far-reaching implications on how companies manage their supply chains:

We asked respondents how they perceive each of these topics, what initiatives they have planned to adopt them into their supply chains, and what challenges they face in trying to fully capitalize on them.

Detailed findings

Supply chain analyticsThe use of analytical techniques and solutions to aid supply chain decision making, improve visibility to performance and optimize operations

Mobile supply chainsProliferation of mobile devices, M2M (machine-to-machine) and similar supply chain technologies such as bar coding, image scanning, voice data collection and RFID

Additive manufacturing technologiesManufacturing three dimensional solid models from a digital blueprint (often referred to as 3D printing)

Supply chain sustainabilityApplying a long-term view to supply chain decision making by focusing on controlling environmental costs in the supply chain while improving or maintaining performance

Multichannel fulfillmentThe ability to fulfill consumer orders and receive/handle returns from anywhere (e.g., store and/or distribution center) and provide consistent performance across all customer categories and channels

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Supply chain analyticsThe use of analytical techniques and solutions to aid supply chain decision making, improve visibility to performance and optimize operations

Supply chains play a central role in serving customers and controlling costs. As such, they are key to competitiveness in today’s marketplace.

Improvements in computing technology and an explosion in data have helped supply chain analytics emerge as an important tool for companies to create competitive advantage. Executives are keen to leverage analytics to derive new insights from the vast amounts of data being generated in their organizations — and to use those insights to improve performance and streamline operations.

Leading companies were quick to recognize how analytics could help improve performance. However, there now seems to be a broad consensus among executives that supply chain analytics is a strategic priority. Almost 80% of our respondents say that supply chain analytics is at least “moderately important” supply chain priority.

An almost equal number believe significant gaps exist in their supply chain analytics capabilities and adoption. This implies that while analytics is a strategic consideration, there are execution gaps related to adoption and implementation that may be preventing organizations from fully capturing the desired benefits.

Many organizations are trying to address these issues and gaps. Nearly 85% of respondents believe their companies, customers and clients will continue to invest in supply chain analytics over the next three years. This trend will likely be led by ‘Retail and Wholesale’ companies, with over 90% of respondents in that sector expecting their companies to continue making supply chain analytics investments, and 70% expecting the level of investment to increase. Investments are expected to focus on ‘Demand and Supply Planning’, ‘Logistics and Distribution’ and ‘Inventory Planning’ due to relatively higher needs in those areas.

Companies also expect to focus significant attention on talent development to build supply chain analytics-related skillsets and know-how among executives and staff. Over 65% of respondents from ‘Retail and Wholesale’, ‘Transportation and Warehousing’ and Consumer Packaged Goods companies plan to invest in building up their internal supply chain analytics capabilities. While the

Figure 7: Strategic importance of supply chain analytics

Don’t know/Not applicable

7%Not

important2%Slightly

important12%

Moderatelyimportant

40%

Veryimportant

39%

Figure 8: Expected changes in investments overthe next three years


11%No plansto invest

5%Decrease

3%

Remainthe same

27%

Increase54%


main focus will likely be on training programs to build capabilities, over 30% of ‘Retail and Wholesale’ and Consumer Packaged Goods companies also expect to hire from the outside to bring the required skillsets into their organizations.

There is a lot of interest in advanced analytical techniques that can provide forward-looking guidance to improve supply chain decision making. These techniques can help supply chain executives better prepare for future market conditions through simulations and improved forecasting. While there is value to be derived from investing in advanced tools and technologies, our study indicates that the immediate priority for many companies should be to get the basics right. A key capability for any organization is the ability to track and measure key metrics related to the health and performance of its supply chain operations. The survey responses reveal a critical gap area in this area, with less than half of surveyed executives saying their companies, customers and clients have a well-defined strategy or robust processes for supply chain metrics and key performance indicators. Research shows that another common challenge faced by many companies is a lack of quality of data in their systems. This prevents executives from being able to trust the data when making decisions.

Addressing these critical capability gaps can help improve the effectiveness of existing analytical tools and encourage adoption of new tools throughout the organization. Any organization that wants to move up the maturity curve in analytics should perform an assessment of its existing capabilities and address any gaps before attempting to implement more advanced tools. Starting with a solid foundation will help ensure that future investments provide the desired benefits and returns.

Mobile supply chainsProliferation of mobile devices, M2M (machine-to-machine) and similar supply chain technologies such as bar coding, image scanning, voice data collection and RFID

Customer expectations are rising and organizations are responding by creating a more responsive, real-time supply chain. Mobility and M2M (machine-to-machine) technologies are key capabilities that can empower a company’s supply chain workforce by providing them with the right information at the right time and place so they can serve their customers better.

An increase in adoption of M2M and other similar technologies (including bar coding, image scanning, voice data collection and RFID) can make equipment smarter and enable real-time supply chain visibility. Although these technologies have been around for a while, they are now seen as increasingly relevant for supply chains.

Our survey shows that executives are starting to view supply chain mobility as a key strategic issue. In fact, over half of the respondents rate supply chain mobility and adoption of M2M technologies as “very important” (18%) or “moderately important” (35%).

The immediate priority for many companies should be to get the basics right

Figure 9: Strategic importance of supply chain mobility


16%

Notimportant

9%

Slightlyimportant

22% Moderatelyimportant

35%

Veryimportant

18%

16

While mobile and M2M technologies have important applications across the supply chain, the survey results indicate their adoption will likely be highest in areas related to Warehouse Operations, Inventory Management and Transportation.

Given that the technology is still in the early stages of supply chain adoption, it is not surprising to find significant capability gaps that prevent companies from fully capturing the benefits of this innovation. According to the survey, roughly 70% of respondents currently suffer from significant capability gaps. The problem is most prevalent in the Transportation and Warehousing sector, where roughly 85% of respondents report significant supply chain mobility-related gaps that exist in their organizations today.

Implementing supply chain mobility technologies presents its own challenges. According to the survey, the biggest challenge is integrating mobile applications with existing infrastructure and across the value chain.

Many existing applications were developed for specific uses and do not integrate well within end-to-end solutions. This has slowed their adoption. Such challenges are typical for emerging technologies and are likely to be addressed over time as the ecosystem matures and application providers improve their offerings.

Despite the challenges, companies seem optimistic about investing in this area. Three out of four respondents expect their companies to make supply chain-related investments in mobile capabilities and M2M technologies, and nearly half expect these investments to increase over the next three years.

Companies are also investing in talent. Many respondents say they are planning training programs for their supply chain workforce. And in the Retail and Wholesale, Transportation and Warehousing, and CPG sectors, nearly 20% of companies plan to complement their training initiatives with external hiring to bring more mobile-savvy talent into the organization.

Nearly 20% of companies in Retail and Wholesale, Transportation and Warehousing, and Consumer Packaged Goods expect to hire skilled talent to grow their mobile capabilities

Figure 10: Challenges in implementing mobile capabilities and M2M technologies


Other

Data security concerns

Lack of skilled workforce that canuse and implement these technologies

Initial investment required

Lack of end-to-end solutions that address a variety of business needs

Difficulty in integrating mobileapplications across value chain partners

(with suppliers, customers, etc.)

Difficulty in integrating mobileapplications with existing infrastructure

49%

42%

32%

28%

28%

18%

2%

20%


In the past, supply chain applications using mobility and M2M technologies were largely associated with large multinationals and companies at the leading edge of supply chain innovation. However, our study indicates that such applications are already becoming increasingly common at companies of every shape and size. And as the ecosystem matures, implementing these technologies and their associated applications will likely become more cost effective — further driving adoption.

Looking ahead, these technologies will likely produce their greatest value when combined with business analytics. This powerful combination has the potential to enable real-time decision-making and deliver real breakthroughs that make supply chains more dynamic and efficient.

Additive manufacturing technologiesManufacturing three dimensional solid models from a digital blueprint (often referred to as 3D printing).

Additive Manufacturing — commonly known as “3D Printing” — is a technology many people believe will revolutionize production processes and have far-reaching implications for product supply chains. It involves manufacturing or “printing” a three-dimensional object using a computer-controlled laser that melts plastics or alloys according to a digital blueprint. Many industry watchers are already talking about a future where 3D Printing can localize production and improve supply chain efficiencies by reducing waste and enabling just-in-time manufacturing. However, there is a significant disconnect between this long-term vision and the current market outlook. Although many experts and analysts are excited about the transformative potential of 3D printing, most industry executives are not yet convinced — at least in the medium term.

Only 17% of our survey respondents view 3D Printing as a strategic priority, while 70% believe it is not strategically important or are unsure of its impact.

Figure 11: Expected change in investments over the nextthree years


17%

No plansto invest

7%

Decrease3%

Remainthe same

27%

Increase46%

Figure 12: Strategic importance of 3D printing

Don't know/Not applicable

27%

Notimportant

41%

Slightlyimportant

15%

Moderatelyimportant

12%

Veryimportant

5%

18

What’s more, a detailed analysis of future investment plans shows that much of the enthusiasm for 3D printing is currently coming from the “sell side” — i.e., companies that sell supply chain products and services — not from companies that would actually buy and use the technology. According to our survey, nearly 40% of sell-side respondents expect supply chain investments to increase over the next three years, but only 16% of buy-side respondents share their optimistic view.

This could mean that sell-side companies are overestimating the relevance of 3D printing for their customers. It could also mean that buy-side respondents agree on the long-term potential of 3D printing, but do not believe it will have a significant impact in the next three years. Whatever the case, neither side has widespread and concrete plans to develop 3D printing skills and capabilities within their workforce.

The survey results suggest that while 3D printing may someday revolutionize product-based supply chains, it is not likely to disrupt traditional supply chain models in the near to medium term. That said, companies should closely follow the evolution of this potentially transformative technology and be prepared to invest when the technology matures and practical applications become available.

Figure 13: Expected change in investments over next three years (as indicated by supply chain products and services providers)


29%

No plansto invest

8%

Remainthe same

24%

Increase39%

Figure 14: Expected change in investments over next threeyears (as indicated by their customers and clients)


35%

No plansto invest

25%

Decrease1%

Remainthe same

23%

Increase16%


Supply chain sustainabilityApplying a long-term view to supply chain decision making by focusing on controlling environmental costs in the supply chain while improving or maintaining performance

Cost reduction has long been the top priority for supply chains. However, increasing attention from consumers and the media on environmental and social issues is forcing businesses to take a broader view, with greater emphasis on sustainability.

According to our survey, supply chain sustainability has become an important strategic priority for many companies, with four out of five respondents rating sustainability as at least “moderately important” and nearly half rating it as “very important”.

The percentage of companies rating sustainability as at least “moderately important” was especially high in three sectors: Transportation and Warehousing (~90%), Consumer Packaged Goods (85%), and Retail and Wholesale (~80%).

Despite the growing emphasis on sustainability, nearly 75% of respondents believe their organizations face significant capability gaps in terms of sustainability processes and

skillsets. Also, only ~30% of companies have very clear ownership and governance structures for their sustainability initiatives. These problems are likely undermining the value and effectiveness of their sustainability initiatives.

The study indicates that companies are keen to address these gaps, with ~65% of respondents expecting to build capability through a combination of training initiatives and external hiring.

While the commitment to invest and improve capabilities is necessary, companies also should create a sustainability culture among their supply chain executives and staff. The companies we surveyed say the biggest challenge with executing sustainability initiatives is the “traditional and continued focus on cost reduction.” Two other major obstacles are the cost of implementing sustainability initiatives, and the difficulty of measuring the return on sustainability investments.

Figure 15: Strategic importance of supply chain sustainability


5%

Notimportant

3%Slightly

important13%

Moderatelyimportant

30%

Veryimportant

49%

Figure 16: Sustainability related capability gaps


9%Low or

industry leadingcapabilities

4%

Somewhatlow12%

Average47%

High22%

Very High6%

Four out of five companies view sustainability as at least “moderately important” and nearly half rate it as “very important”

20

These challenges underscore a need within organizations to understand and agree on the benefits of a sustainable supply chain. While many benefits of sustainability are intangible, there are also tangible benefits such as cost savings and improved operational efficiencies that can deliver significant value in the long term. A well-defined business case that explains the trade-off between short-term profitability and long-term shareholder value can go a long way in helping companies make their supply chains more sustainable.

Despite the challenges and hurdles, companies today have a real opportunity to create long-term value and competitive advantage by committing to sustainability in their day-to-day operations.

Case study: Investing for long-term valueA leading fashion retailer was building a fulfillment center for their e-commerce operations and was considering installing solar panels to make the facility more sustainable.

Company leaders decided to postpone the installation after a study found the solar panels would not be immediately economical; however, they also approved additional investments of several thousand dollars to bolster the building structure to support solar panels in the future.

This example highlights the smart trade-offs that companies are making to address sustainability concerns.

Figure 17: Challenges faced in implementing supply chain sustainability initiatives

Other


Staff incentives are not alignedto drive action on sustainability

Existing staff don’t possessnecessary skills or training

Time required toimplement initiatives

No clarity on customer valueof sustainability initiatives

Lack of ownership and agovernance structure to

drive sustainability

Limited visibility and controlover suppliers’ operations

Not seen as a source ofcompetitive advantage

Inability to measure benefitsof sustainability initiatives

Cost ofimplementing initiatives

Traditional and continuedfocus on cost reduction 55%

41%

29%

24%

23%

20%

20%

18%

16%

9%

9%

0%


Multichannel fulfillmentThe ability to fulfill consumer orders and receive/handle returns from anywhere (e.g., store and/or distribution center) and provide consistent performance across all customer categories and channels

Traditionally, supply chains were designed around one primary channel (e.g., store replenishment for retail companies, or order fulfillment for wholesale companies). This helped companies optimize their operations around their key customers and product categories. But as new channels were added to target new customer segments, compete against new competitors, and increase market share, supply chain capabilities and channel requirements

often became misaligned. This limited the flexibility to scale operations and seamlessly serve customers through multiple channels.

Although an obvious benefit of multichannel fulfillment is an improved customer experience, there are other important benefits for the business as well. These include: greater operational flexibility, improved responsiveness and speed to market, and the ability to manage inventory across channels more effectively.

Our study found that executives are beginning to recognize the growing importance of multichannel fulfillment for their customers, and to understand the need for a dedicated multichannel strategy. Nearly two-thirds of respondents believe multichannel fulfillment is either a “very important” (34%) or “moderately important” (27%) strategic priority.

Growth in multichannel demand has outpaced the expectations of many companies and exposed gaps in their operational readiness to fulfill this demand. The survey results show that 65% of companies perceive significant process, technology and skillset gaps in their multichannel fulfillment capabilities.

Case study: Ignore multichannel at your perilThe holidays are always a busy period for retailers. However, the most recent holiday season was busier than usual for a variety of reasons — consumers being more comfortable buying online, a condensed holiday shopping period, and a lot of promotional activity leading up to Christmas — which kept retailers and their logistics service providers on their toes trying to deliver products to consumers on time.

Many retailers saw direct-to-consumer and online sales that were significantly higher than expected. Logistics service providers therefore faced delivery volumes that were much higher than planned. This led to service failures both within retailers’ supply chains and with the carriers. Although the failures were only a small percentage of the total shipment volume, the negative press generated may have significantly affected consumer perceptions about service quality and the ability of businesses to meet their delivery commitments.

This situation highlights the extent to which companies might be underestimating the growth of multichannel demand among consumers — and the negative impacts that can result.

Figure 18: Strategic importance of multichannel fulfillment


16%

Notimportant

8%

Slightlyimportant

15% Moderatelyimportant

27%

Veryimportant

34%

22

On a positive note, our study also shows a healthy investment outlook for multichannel fulfillment. Over 70% of respondents expect to continue investing in multichannel fulfillment, and almost half expect their investments to increase in the next three years.

“Retail and Wholesale” and CPG companies seem to be the most enthusiastic, with close to 90% expecting to continue or increase their investments.

Talent development initiatives are helping companies build multichannel capabilities in their supply chain workforce. Almost three out of five respondents expect to shore up their capabilities in this area through a combination of training programs and external hiring. Plans for external hiring are highest in ‘Retail and Wholesale’, where over 25% of companies cite external hiring as their primary talent development strategy.

Designing and implementing multichannel fulfillment strategies presents a wide range of challenges. The top challenge according to our respondents is controlling cost-to-serve, which suggests companies are still emphasizing profitability even as they pursue multichannel fulfillment. Another top challenge is that legacy supply chains and systems are designed around a primary fulfillment channel and are not optimized for multichannel capabilities.

Figure 19: Expected change in multichannel investmentsover the next three years


20%

No plansto invest

7%

Decrease2%

Remainthe same

25%

Increase46%

“A retail client I know is currently working on merging their ecommerce and retail distribution operations and moving towards one pool of inventory. Their biggest challenge is legacy systems. They have separate platforms for ecommerce and traditional retail and this limits what they can do in terms of one pool of inventory. I suspect that this is a concern for many other retailers, especially store-based retailers making the move to multichannel.”

Britt Dayton, Director, Logistics and Distribution, Deloitte Consulting LLP

Investment outlook related to multichannel fulfillment is good


Implementing a multichannel model will likely require significant changes in fulfillment operations. Many companies have traditionally maintained dedicated facilities to serve demand from specific channels; however, a growing number of companies are now adopting multichannel strategies in which fulfillment centers are capable of meeting demand from multiple sales channels. To effectively support multichannel operations, companies need real-time inventory visibility at every facility so they can synchronize operations across the supply chain. This can help improve efficiency by managing all inventory as part of one common pool, rather than maintaining separate inventory for different channels at dedicated fulfillment centers.

Many companies are thinking about upgrading their technology systems to support these new capabilities. Upgrading supply chain planning and execution systems and automating fulfillment operations can help companies fulfill orders faster and more effectively. Layering these improvements with innovations such as supply chain analytics and mobile capabilities can further enhance the ability to respond to customer demand more quickly and help maintain lean and efficient multichannel fulfillment operations.

For many supply chains, the transition to a multichannel model will require structural changes to their fulfillment operations. To understand the implications of this transition on the organization and supply chain, a company should develop a clear multichannel strategy based on a thorough assessment of its existing distribution network and capabilities.

Multichannel fulfillment has emerged much faster than many organizations expected — and is quickly becoming table stakes for competing in the marketplace. Companies should start viewing multichannel fulfillment as the “new normal” and should consider investing in technology, skillsets and processes geared towards fulfilling their customers’ multichannel expectations.

Figure 20: Multichannel fulfillment related challenges

Don't know/Not applicable

Other

Inadequate employee training

No multichanne; metrics/KPIsto drive performance of staff

Lack of leadership support indriving multichannel strategies

Gaining adequate visibilityto cross channel demand

Infrastructure modificationand/or expansion costs

Difficulty in meeting customer's deliverytime and service level expectations

Coordinating multichannel supply

Integrating technology applications andsystems across functions and channels

Existing distribution footprint not optimizedto effectively enable multichannel fulfillment

Controlling cost to serve 41%

36%

31%

26%

26%

20%

17%

11%

6%

1%

0%

21%

24

MHI and Deloitte conducted the first MHI Annual Industry Report survey of more than 450 company executives and manager in November and December of 2013 to gauge their perspectives on emerging supply chain innovations. The survey was conducted via an online questionnaire.

The companies represented a variety of industries with the largest representation in Material Handling and Supply Chain Equipment and Related Software and Services, Retail and Wholesale, Transportation and Warehousing and Consumer Packaged Goods.

Figure 21: Respondents by industry sector

Industry sector % of total

Material Handling and Supply Chain Equipment and Related Software and Services 19%

Retail and Wholesale 17%

Transportation and Warehousing (incl. 3PL, Contract Warehousing) 15%

Consumer Packaged Goods 13%

Automotive 9%

Other Process and Industrial Products 7%

Consulting or other Professional and Technical Services 5%

Life Sciences and Health Care 4%

Consumer Durables 3%

Education 3%

Technology, Telecom and Media 3%

Energy, Resources and Utilities 2%

Financial Services and Insurance 1%

Regarding company size, 25 percent of the companies had sales of less than $50 million, 15 percent had sales of $50 million to less than $100 million, 7 percent had sales of $100 million to less than $200 million, 14 percent had sales of $200 million to less than $500 million, 9 percent had sales of $500 million to less than $1 billion, 11 percent had sales of $1 billion to less than $5 billion, 9 percent had sales of $5 billion to less than $10 billion and 10 percent had sales of $10 billion or more.

Figure 22: Respondents by company size

Company size % of total

$10 billion or more 15%

$5 billion to less than $10 billion 7%

$1 billion to less than $5 billion 14%

$500 million to less than $1 billion 9%

$200 million to less than $500 million 11%



Less than $50 million 25%

About the survey


Regarding the titles of respondents, 18 percent held C-level titles (such as chief executive officer, chief financial officer, chief supply chain officer or chief information officer), 41 percent were senior vice president, vice president, director, head of business unit or head of department, and 28% were manager level.

Figure 23: Respondents by level

Title % of total

Board Member/CEO/President/Managing Director 12%

Chief Supply Chain Officer 1%

CFO/Treasurer/Comptroller/CIO/Technology Director/Other C-level 5%

SVP/VP/Director 21%

Head of Business Unit 7%

Head of Department 13%

Manager 28%

Other 13%

26

Acknowledgments

We would like to acknowledge the hundreds of organizations that participated in our survey. We would also like to thank the MHI Board for their contributions to the survey and conclusions.

MHI Officers Dave Young, President, EGA Products, Inc. Chairman of MHI

John Paxton, Vice President and General Manager, Terex Corporation President of MHI

Gregg E. Goodner, President Hytrol Conveyor Company, Inc. Vice President of MHI

E. Larry Strayhorn, CEO, SI Systems Last Retiring Executive Chairman of MHI

MHI Board of Governors Steve Buccella, Vice President Corporate Sales and Business Development Dematic Corporation

Bryan Carey, President Starrco Co., Inc.

Brian Cohen, Chief Executive Hanel Storage Systems

Willard P. Heddles, Chairman and CEO Tiffin Metal Products Co.

David R. Lippert, President Hamilton Caster and Mfg. Co.

Brian McNamara, President & CEO Southworth International Group, Inc.

George Prest, CEO MHI

Colin Wilson, President and Chief Operating Officer NACCO Materials Handling Group, Inc.

Brett Wood, President and CEO Toyota Material Handling, USA, Inc.

Additional contributors from the MHI RoundtableKen Beckerman, President Flexcon Container

John Hill, Director St. Onge Company

Kevin O’Neill, Vice President Steele Solutions, Inc.

Pat Sedlak, Principal Sedlak Management Consultants

For further information about the survey, contact the following:George Prest, CEO MHI + 1 704 676 1190 [email protected]

Scott Sopher, Principal and Leader of the Supply Chain & Manufacturing Operations Practice Deloitte Consulting LLP +1 404 631 2600 [email protected]

About MHI MHI is an international trade association that has represented the material handling and logistics industry since 1945. MHI members include material handling, logistics and supply chain equipment and systems manufacturers, integrators, consultants, publishers, and third party logistics providers.

MHI offers education, networking and solution sourcing for members, their customers and the industry as a whole through programming and events. The association sponsors trade events, such as ProMat and MODEX to showcase the products and services of its member companies and to educate manufacturing and supply chain professionals on the productivity solutions provided through material handling and logistics.

MHI 8720 Red Oak Blvd., Suite 201 Charlotte, NC 28217-3992 Tel: 704-676-1190 Fax: 704-676-1199 www.mhi.org

This publication contains general information only and Deloitte and MHI are not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.

Deloitte and MHI shall not be responsible for any loss sustained by any person who relies on this publication.

Copyright © 2014 MHI. All rights reserved.

8597981 MHI Annual Industry Report - Connected World · The 2014 MHI Annual Industry report...

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