Is cloud computing merely a trend or the future of computing as we know it? In recent years, analysts have used survey after survey to find out if IT leaders and organizations would embrace Internet-based shared computing services.

You might be surprised to learn that ArrowStream had the answer to that question almost 10 years ago when cloud computing was still known as ASP (Application Service Provider). We were delivering cloud-based solutions long before hard economic realities made it a top business priority to migrate away from front-loaded investment models and find lighter weight, more flexible technology options.

ArrowStream Chooses SaaS in 2001
ArrowStream made SaaS (now more popularly called cloud computing) our chosen delivery model way back in 2001. The cost savings, flexibility, convenience, efficiency and collaboration capabilities of cloud computing reflected exactly what we set out to be almost a decade ago-the company that transforms the foodservice industry supply chains from reactive apparatuses into a dynamic network of business information and trading partners. We knew the road to greater business performance, bottom-line results and fierce customer loyalty traveled via the supply chain and SaaS was the best vehicle to get us there.

Those five core benefits that convinced ArrowStream to use SaaS a decade ago mirror many of the benefits business leaders across the foodservice industry (and beyond) are looking to gain from “the Cloud” today. They include:

Cost Savings
Cost effectiveness is a top and enduring priority for businesses working throughout the foodservice supply chain, from manufacturing to distribution to restaurant chains.  Cloud computing saves businesses significant upfront and long-term costs. Lower TCO (total cost of ownership) begins with the fact that there are no startup infrastructure costs.  Hardware, software, and ongoing maintenance is provided by the service provider. Technology is accessed securely over the Internet using a browser.

Businesses are also able to “pay as they go.” For example, that means ArrowStream clients only pay for supply chain services they use rather than paying for a giant solution package in which only parts would be utilized.  With centralized automated updates, cloud computing eliminates several administrative and operational tasks and offers one of today’s surest paths to greater efficiency.

Flexibility
Businesses expand and contract at different times, but often technology investments are a one-time buy at one size. The cloud changes that by establishing constant access to technologies and services over the Internet. Businesses can easily scale their technology subscriptions with the fluctuating size and needs of their businesses. Simply increase subscription numbers over the cloud to add new users. The same goes for scaling back. Businesses can easily cut back users and reduce access to programs to immediately reduce business costs.

It’s also simple to expand the capabilities of a solution via the cloud. For example, should a business’ supply chain reporting needs increase, ArrowStream OnDemamd customers can easily expand their reporting capabilities online. They can also reduce them if they are not being used.

The instantaneous flexibility businesses gain through the cloud not only equals rapid scalability but also gives businesses more direct, immediate control over supply chain costs.

Convenience
Internet-based services offer a level of convenience that anyone who banks or shops online understands very well. It’s hard to beat the convenience of being able to log in and get information from anywhere at any time. ArrowStream OnDemand clients have enjoyed that freedom for nearly a decade, which has expanded real-time management visibility into supply chain operations.

Because supply chain data and applications are always accessible anywhere, supply chain teams are better connected with the business teams (marketing, procurement, etc.) they collaborate with, the trading partners upon whom they depend, and the senior executive leaders who are eager to better understand supply chain operations.

Increased Efficiencies
Several operational efficiencies are gained as a result of cloud computing. For example, the expanded and widespread access to supply chain information means greater flexibility and more informed, faster decision making.  The simplicity of online services means less training for users and less training costs for businesses. Because there are fewer demands on the company infrastructure with cloud-based solutions, businesses save on infrastructure maintenance costs.

Simplified, Secure Collaboration
Since ArrowStream’s inception, we have advocated greater trading partner collaboration across the supply chain. However, divergent backend systems and technologies have made this a complex process. Not so with cloud computing, which gives businesses a shared space where they can immediately provide trading partners with access to critical supply chain information (inventory levels, delivery schedules, etc.). By having access to the cloud, businesses can protect the data they feel is essential to competitive advantage while sharing vital knowledge that can keep the supply chains of their partners and clients highly efficient and informed.

No matter what you name it-ASP, SaaS, cloud computing -the benefits of Web-based services are tremendous, especially across the supply chain where access to real-time knowledge has a powerful impact on day-to-day business results. As more businesses and trading partners seek out greater supply chain efficiency via the cloud, the faster and more insightful well-managed supply chains become.  It’s an evolution that’s about to gain big momentum, which is why ArrowStream is glad to be years ahead of the learning curve.

In the rigorous work of supply chain management, it’s good to have lots of partners on your side. That said, many supply chain managers often overlook the marketing team, one of the most valuable business partners they have.

Supply chain leaders from many of the world’s largest restaurant chains have admitted to ArrowStream that they do not effectively partner with their marketing colleagues to better understand the objectives, strategies and even timelines behind promotions. Instead, they just try to best react and support marketing efforts as they occur. What’s lost in this reactive stance is the ability to execute effective promotions that best leverage resources across the entire supply chain.

Consider this finding from ArrowStream’s 2nd Annual Foodservice Industry Survey: More than 75 percent of foodservice industry leaders cited problems with LTO (limited time offer) demand planning. Stock-outs and inventory obsolescence are devastating to promotions and those troubles erupt quickly into sales and customer loyalty and satisfaction challenges. When supply chain teams are not a part of the LTO/promotion planning process, their ability to deliver on timelines and prepare teams and trading partners is forfeit. Marketing is stuck with a supply chain team that can only “do their best under the circumstances” and the supply chain team is stuck scrambling. Neither position is an enviable or effective one.

So what will greater supply chain and marketing collaboration win a business in these still trying economic times? By partnering with marketing from the very start of promotional campaign development, supply chain teams serve as a valuable information resource to marketing partners. The result for marketing will be more effective promotions driven by greater insight into supply chain processes. The result for the supply chain organization will be early insight that allows teams to better prepare for and, therefore, better execute promotions. The result for the business: more traffic, greater sales, higher rates of customer satisfaction and increased revenue.

Common Sense Tips for Partnering with Marketing

Most supply chain teams know all too well the importance of good collaboration with the marketing team. Often, it’s just a lack of time that keeps them from best practices. Here are a few reminders of the simple, common sense collaboration practices that can help keep communications strong and collaboration effective:

• Meet Regularly - If you want to understand and support marketing’s efforts, you have to get to know them. Work with your marketing peers to establish a regular meeting schedule that will ensure you have a clear and constant picture of marketing’s calendar, goals and objectives and that marketing understands the work and resources required of the supply chain to meet their goals.
• Teach Supply Chain 101 - Marketing professionals have their own objectives and tough challenges to face, leaving them little time to learn the fundamentals of supply chain operations. However, just a small amount of knowledge can go a long way in helping your marketing counterparts understand the many factors that influence product movement, cost and timeliness. Take the time to educate marketing peers about what happens across the supply chain in order to ensure their promotions are fulfilled. Even job shadowing or one-day job swapping can provide a ton of insight that can help marketers more successfully plan marketing promotions and give your team important insight into the important work marketing does.
• Make Knowledge Sharing a Priority - When issues or changes occur in the supply chain that can affect marketing’s promotions and their execution, share the knowledge early and thoroughly. By making marketing a communication priority, supply chain leaders are establishing a powerful knowledge-sharing channel and building a relationship that will allow the teams to better partner and deliver together.
• Consider Technological Integration - Are there ways to better communicate and share information through the technology tools you have in place? Does your supply chain management solution integrate marketing into knowledge and information sharing? If not, it may be time to consider a more expansive supply chain solution that enables collaboration within the business and across supply chain trading partners. Remember, the greater the information integration is, the more informed, effective and reliable the supply chain will be.

Finally, if you should find marketing teams are resistant to sharing information or collaborating, ArrowStream recommends making your business case. Host a meeting or prepare a convincing fact sheet that demonstrates the many ways supply chains processes effect the timeliness and quality of promotions. Marketing professionals, like anyone in your company, are very busy but they are also committed to the same fundamental goals as the supply chain: increasing sales and customer loyalty and satisfaction. Reminding your marketing team of what a useful and powerful partner the supply chain can be is a great way to win support and help everyone work together to improve bottom-line business success.

The Web continues to change the way we work, and the latest milestone in this evolution is social media. How socially networked is your supply chain? Are you using tools like LinkedIn and Facebook to connect with your supply chain partners? Are you networked and engaging partners through user or sub-groups? If not, you are missing an opportunity to directly engage and collaborate with peers who have significant influence on your supply chain’s effectiveness.

While foodservice businesses have long known that social media is a powerful way to connect with consumers (think viral promotions and social networks for like-minded shoppers and coupons sharing), working social media into supply chain collaboration has been a slow-moving process. While the culprit may be skepticism of social media’s staying power, I believe the more likely culprit is time. Who in the precision world of supply chain management can spare even a moment for blogging, tweeting, updating their Facebook page?

What is important for supply chain managers to consider is how social media is changing the way people get information-even the information we rely on to do our jobs. How we research, get news and find referrals has migrated quickly to the Web due to social networking. Just a few years ago many supply chain professionals relied heavily on trade publications to give them insight into business trends and emerging technologies. Now more and more are meeting up online through groups on LinkedIn, Facebook and other social media sites to get the information directly from industry resources, peers and colleagues.

 As information sources and idea-sharing shift to online networks-supply chain professionals can use these mediums to create greater opportunities for collaboration. How? Here are several ways you can begin to leverage social media to your supply chain’s advantage:

Dedicate a Team Member
The realm of social media expands every day-as do the tools people use to connect and interact. It’s important to have one person on your supply chain team who can dedicate part of his/her time to researching where clients and partners are connecting online, building and maintaining communities, updating core sites with fresh content and staying on top of important trends.

Expand Your Network
If you and your team are only just getting started in social networking, the first step is to build your networks by registering on core sites-LinkedIn, Facebook and Twitter-and building up your contact base. However, the big names are not the only names in social networking. Industries and interest groups are rapidly forming new social networking sites every day, so do some exploring to find out which niche industry and professional networks you should consider joining.

For example, there are many emerging sites for the supply chain and foodservice industries. Logipi recently launched an online business community dedicated to supply chain professionals while networks like Biteclub, FohBoh and Foodservice Rewards focus on the restaurant and foodservice industries. No matter how focused your career, interest or hobby, you are sure to find a social network dedicated to it today. Find a handful that are useful to you professionally and try them out.

Once you’ve built your online communities, get the word out to your customers, prospects, employees, personal contacts and other industry partners who you work with regularly. Place links directly on your website to your networks and start an email campaign inviting others to join.

Build a Common Interest Groups/Web Community
You can build an online group/community for your key supply chain partners. A small, focused online community allows you and your supply chain partners and suppliers to easily share ideas, ask questions and discuss best practices in a low-maintenance forum. It takes very little work and you would be surprised how quickly these turn into use information resources you and your peers turn to when stumped by a supply chain challenge.

Write a Blog
Business blogs can be a useful tool for sharing thought leadership and trends with your key partners. It allows you the chance to share a bit of expertise-establishing credibility-while giving your readers the chance to respond and create an interesting dialogue.

You can invite your partners to follow your company’s blog to help them understand your business better and you can do the same by following their blogs and news. The key is to make sure content is refreshed regularly and you are sharing information that can help your partners and clients do their jobs better.

These four steps are a good way to build a foundation of social networking activity that can bring you closer to the supply chain collaborators with whom you want to stay in close contact. As your networks strengthen, you will find that you are rewarded for sharing valuable content by partners and peers who will reciprocate with knowledge, referrals and news that can help you do your job better and improve your supply chain management.

For even more insights, news and resources; check out ArrowStream’s online communities:

Facebook (http://www.facebook.com/arrowstream)

LinkedIn (http://www.linkedin.com/groups?trk=anet_ug_hm&gid=2121229&home=)

Twitter (http://twitter.com/ArrowStreamInc)

Restaurant Leadership Offers 2010 Outlook

At the end of April, I attended Restaurant Leadership-a national gathering of industry, business and community visionaries. The mood was upbeat as we heard businesses express their optimism for a profitable year. The consensus is that the restaurant industry is hacking its way out of the thick weeds of the recession, and starting to find room to grow again. 

While it was exciting to debate industry trends (this year the role of social media was a hot topic and one I will cover in a future blog entry soon), the real issue of the event and of this year is the tough competition restaurants have from supermarkets and retail giants like Target and Wal-Mart. With grocers and retailers selling prepackaged meals at very low costs (often much lower than the cost of eating out), restaurants face ongoing price pressure despite improvements in the economy.

At the end of 2009, CREST (Consumer Reports on Eating Share Trends) reported that supermarkets prices had fallen from the year prior while restaurant prices were higher. Wallet conscious consumers have been cooking and eating at home more often and the question is how do restaurants lure them out again? The odds are high that penny pinching will continue among consumers. Americans are saving more than twice the amount they were two years ago according to the Bureau of Economic Analysis. In the fourth quarter of 2007, 1.5% of earnings was going toward savings in American households. By the fourth quarter of 2009, the number had risen to 3.9%.

Rather than waiting for a shift in consumer habits-good habits like saving more-restaurants will need to compete head-to-head with supermarkets and their low-cost, prepackaged foods. That means price is king and efficiency is a must. Restaurant chains will need to squeeze every bit of efficiency out of their supply chains in order to keep prices competitive and attractive to cost conscious consumers. Even grocery and giant retail competitors are loudly talking to the market about supply chain efficiency. Think of Wal-mart’s current TV ads, which speak to making the most of their truckloads in order to deliver lower prices to their customers. The supply chain is your most direct route to greater efficiency and the world’s largest retailer knows it.

Restaurants too must invest in supply chain solutions that provide greater visibility and the detailed knowledge needed to better manage their pricing, spending, logistics and promotions. Only with end-to-end and trading partner-to-trading partner supply chain insight can restaurant chains truly compete in terms of price with grocers and super stores today. And in this brightening economy, restaurant leaders nationwide agree: It’s a good time to get out there and compete.

February  26, 2010 | Steven LaVoie

Part 4 of a 4 part series

To conclude our series of tips for businesses working to increase supply chain openness with trading partners, I am going to talk about performance goals. As you make significant changes to your supply chain operations and technologies, it’s critical to define and communicate the goals behind these changes. While the senior management team that signed off on purchase orders and read business cases may well understand the motivations and objectives behind major supply chain changes, there are still many people across the entire business organization that might not have that information.

It’s important to make communicating supply chain changes and performance goals to key audiences a formal part of your change management process. Why? Because it helps to ensure that the new strategy and system are embraced and utilized for maximum business benefit. At ArrowStream, we suggest defining your audiences as well as what they need to know and what performance goals are expected and the metrics you’ll use to measure it.

• Supply chain staff - These critical team members need to understand how, when and why the changes are happening, how they will affect their roles and what will be expected of them. Make part of the communications process a formal discussion of performance goals and how supply chain staff will be expected to help measure and analyze the effectiveness of any new supply chain solution or approach. It’s also important that staff members understand performance goals will be regularly measured, analyzed and shared. You’d be surprised how many businesses outline performance goals for the supply chain and its teams but never measure them. Incorporate performance metrics such as issue resolution times and total product and freight spend.
• Business partners - Across your organization, various departments will be affected by supply chain solution changes. Promotions, for example, involves multiple departments from supply chain to purchasing and marketing. Be sure they are well-informed of the changes, how they will affect their operations and what improvements they can expect. Include them in the performance management process by asking them to note improvements and/or performance declines as they relate to the new system. Also, communicate the metrics needed to measure performance. For example, with promotion performance, you’ll want to measure inventory obsolescence, stock outs, and ROI.
• Executive management - Keep executive management keenly aware of progress and milestones achieved as you upgrade and open your supply chain operations. They should have access to high level performance metrics such as, total landed costs, spend analytics, inventory volume tracking and promotions management. Likely major objectives have been defined, but also take time to share insights and anecdotes into information executive management might not be tracking. For example, if team efficiency has greatly increased due to automation or better information, share the story. If new information provided through the more open and trading partner-integrated operations has allowed the supply chain team to make unanticipated but important improvements, share the story.
• Trading partners - As you open up your supply chain operations to more trading partner insight and scrutiny, be certain you are sharing performance goals and expectations. Remember, it’s not just more information you are hoping to gain by increasing supply chain openness, its better business performance. Don’t be shy about defining your expectations for improved working relationships with trading partners, whether that is framed in terms of cost, on-time performance or greater information access. And remember, your trading partners will have performance goals as well and in most every case both businesses will benefit from defining and measuring them.

This blog entry concludes the ArrowStream Tenets of Achieving Greater Supply Chain Openness series. As you consider how to increase information sharing and collaboration across your supply chain and trading partner relationships, keep them in mind. We look forward to hearing how your supply chain operations are expanding and improving through greater insight, partnership and visibility.

February  23, 2010 | Steven LaVoie

Part 3 of a 4 part series

In our ongoing series on increasing supply chain openness, I have shared the first two tenets of success: 1) a broad network of partners and 2) strong supply chain technologies that can integrate trading partner systems. In this posting, I would like to share with you the importance of maintaining effective change management processes, which is the third tenet of supply chain openness.

While few people would immediately select change management tools and resources as vital to supply chain operations, we at ArrowStream have seen firsthand how important they are in evolution of opening up the supply chain. Today, technology plays an important role in increasing information sharing and collaboration among trading partners. With the integration of new technologies and capabilities, many manual supply chain processes are automated, such as contract management and price notifications. Increased automation changes the fundamental roles and responsibilities of supply chain team members.

To ensure supply chain staff evolve with technology and are supportive of efforts better integrate trading partners into supply chain operations, businesses need to establish strong change management processes, which ArrowStream defines in three phases: alignment, incentives and, finally, execution.

Alignment - It’s critical that staff members and your trading partners are carefully educated and prepped for the operational and process changes that come with major supply chain advancements. This includes not only solid training around new technologies, but also clear instruction on how their own roles are evolving, an understanding of your business objectives and the metrics that will be used to measure performance (total freight spend, cost per case, inventory levels, etc.). This focus on preparing and aligning staff and trading partners will win more supporters of the change and alleviates many of the growing pains.  

Incentives - To unite the entire business-from trading partners to executive teams, supply chain and procurement staff-explain the incentives. The whole business stands to gain from supply chain optimization so define what it will look like by communicating the benefits and what the rewards will be. Some clients of ours, will even give bonuses tied to reaching certain metrics and performance goals.

Execution - Once you have aligned all team members to the change and defined and communicated incentives, it’s go time. However, maintaining communication excellence throughout the change process is critical in keeping the organization supportive of the new solution. Send out updates and share when milestones are achieved. Most importantly, let all team members know when benefits (lower costs, greater flexibility, and increased productivity) are realized. Let the entire company see that the change was well worth the challenge.

It’s also important to remember that as supply chain technologies and processes advance, comprehensive and timely information is available to employees across the supply chain. Businesses that prepare their staff for these changes and train them to better manage and understand the information the supply chain provides are cultivating topnotch decision makers. Those that overlook the importance of helping their staff evolve with supply chain technologies are overlooking a fundamental step that will keep them from successfully broadening their supply chain reach, knowledge and effectiveness. 

Please stay tuned for our fourth and final piece of guidance for businesses looking to create greater supply chain openness and integration among their trading partners. I will be posting it in the next several days.

Part 2 of a 4 part series

In December, I posted the first in a four-part series of blog entries focused on the need for greater supply chain openness among foodservice industry trading partners.  That inaugural post looked at the advantages of joining an established network of industry trading partners, which is ArrowStream’s first piece of advice to businesses determined to get on the path to greater openness and more effective cooperation among trading partners.  

Now it’s January. A new year and a new decade have arrived, and it’s time to explore ArrowStream’s second tenet of Supply Chain Openness: Aligning and Integrating Supply Chain Management Technologies.

First, you need to evaluate your relationships with your manufacturer and distributor partners. At ArrowStream, we believe the most fundamental part of technology integration is trust. Have you established trust among your trading partners so that they would be willing to share their data with you? I hope the answer is yes because in order to be aligned and integrated, you must first break the barriers of information sharing by eliminating any fear your trading partners may have with technology integration. Data is the great currency of the information age and when your business is locked out of valuable supply chain data sources due to information protectionism, your organization is the poorer for it. The more your supply chain management tools and applications allow you to connect with those of other trading partners the more information and analytics you have fueling your business decisions.  Explain to your trading partners that with technology integration, everyone shares in the savings.

Look for Compatibility and Integration
So, how does a foodservice business go about ensuring the supply chain technologies it invests in can integrate with trading partners? First, you need to look at the big picture. What is your vision and why is technology good for your business? What results do you expect to see? Widespread technology integration among trading partner supply chain systems can seem like a daunting, long-term goal, however it doesn’t have to be. In fact, integration can be a relatively simple process that will lead to tremendous financial benefits. The more integration you can gain with each technology advancement and enhancement, the more data rich and supply chain efficient your business becomes.

Begin by looking at your 10 most important trading partners and determine what barriers are getting in the way of data sharing - information protectionism; multiple technology platforms; lacking in trust. These unnecessary barriers prevent spend, inventory and supplier data from informing the critical decisions you and your trading partners make every day.   Consider how much more effectively you could work with your suppliers (and benchmark their true performance) by synchronizing data and giving all parties access to valuable information like food spend, procurement, contracts, pricing and shipping information.

Next, talk with the supply chain solution providers to look at how they can support greater integration of supply chain systems. At ArrowStream, we understand how vital integration and data sharing is to the daily efficiency, fundamental success and bottom-line health of our foodservices clients. Any provider of supply chain solutions today knows that helping trading partners better integrate and work together will only make their systems more effective and widely sought after. If you find the certain technologies and/or their solutions providers are limited in helping your business integrate with trading partner systems, quickly take them off your list.

Time & Effort Well Spent
This increased focus on integration capabilities adds only a small amount of time to the technology vetting process but will yield greater visibility, resources and insight to your overall supply chain management solution.  As more and more businesses across the foodservice industry work to better integrate systems and share data, the shorter and shorter this integration assessment process will be. By demanding topnotch integration capabilities from solution providers, industry trading partners are helping to push supply chain technologies exactly where they need to be-on the bleeding edge of secure, smart, innovative supply chain integration.

One Essential Key to Having a Banner 2010

What makes a good manager great? For ages, many believed it was an intangible and immeasurable gut instinct that made strong business leaders visionaries. A manager that took risks by “going with his gut” or “trusting her instincts” had more than moxie, but also a better performance record to go along with it.

While there is always a role for instinct in business, history and measurement have found that sound and timely business information will outdo a sixth sense any day of the week. Take for example the IBM Global Business Services study and report, “Business analytics and optimization for the intelligent enterprise.” The study of more than 400 high and low performing business enterprises showed again and again that top performing businesses are more effectively tapping into timely business data and analytics to improve decision making and business operations. Below are just a few of the outcomes from the study and its executive report, which you can read in full here. 

• In the study, organizations that had analytic programs that were “well underway” were found to be more than three times as skilled at using information to understand risk (and twice as skilled in using that information to predict outcomes) than businesses that did not make analytics a priority.
• Top performing businesses are “twice as skilled as low performing businesses when it comes to extracting and prioritizing relevant information.“
• Top performing businesses were found to be “three times better at applying information for more predictable outcomes, which gives them the opportunity to better anticipate, navigate and handle contingencies.“

This clear link between top performance and the smart use of timely data and analytics across a business organization is irrefutable. In fact, it’s becoming a calling card for success as leading businesses make good, actionable information a main driver of business strategy and competitive advantage.

For the foodservice industry, there has never been a better or more important time to embrace the masses of business data provided by the supply chain and convert it into useful, actionable information. Eating habits are changing and attracting the American consumer will be harder than ever. The peak year for dining out in America was 2001, according to Harry Balzer, senior vice president and chief industry analyst with the market research firm NPD Group. Since then, people have been eating more of their meals at home, ending a five decade trend in which Americans frequented restaurants at ever-increasing rates.  After a decade at the mercy of global fluctuations in commodity and fuel pricing, a brutal recession and falling restaurant traffic, foodservice businesses need to make most of 2010 and the decade it rings in. It must become an era of embracing business intelligence in order to radically improve decision making, efficiency and business performance results. Confident in the value that analytics can bring to the foodservice industry, ArrowStream has greatly expanded its Performance Management capabilities. Our mission is to put critical business information at the fingertips of CFOs and procurement executives. Aggregating spending, inventory, purchasing, volume and contract data from across the supply chain, ArrowStream’s performance management dashboards give foodservice industry leaders an astonishing, new and real-time perspective on costs and vendor performance. 

With the analytical tools performance management provides, CFOs across the industry finally have a simple, flexible system for accurately comparing supply chain trading partner performance and costs. Rather than trusting that a vendor’s costs are low based on price sheets, business leaders can benchmark trading partners in real time to see exactly what is spent and where. This invaluable data can be used to make the very best purchasing and partnership decisions as “best in class provider” becomes a title trading partners must earn rather than a designation assumed by gut feeling. 

Today ArrowStream’s Performance Management Module offers dashboards for Total Landed Costs, Spend Analytics, Inventory Volume Tracking and Market Basket. By the end of 2010, additional dashboards for key functions, such as budget analysis, cost control, inventory, promotion and contract management will be added to the system. To learn more about ArrowStream performance management tools and how they can expand and optimize the ways businesses measure company and trading partner performance, I invite you to click here.

A new decade has come and it’s the perfect time to shake things up for the better. Here’s to 2010, a decade ArrowStream is certain can be one of smarter supply chain management, meaningful business analytics and new standards of excellence across the foodservice industry.

Musings from the 2009 IFMA/IFDA Presidents Conference

They say a little wine can help you learn a second language- dissolving the fear of making mistakes as you try out a foreign tongue.  We also found it to be an excellent conversation complement at the ArrowStream wine tasting event during the IFMA/IFDA Presidents Conference this November.  While none of the attendees, who included foodservice industry executives from leading restaurant chains, distributor companies and manufacturing businesses, were at all nervous about sharing their industry savvy, the wine was a great reason to step back from the conference hubbub. It was a reason to gather, relax and muse philosophically about how to “fix” the biggest problems the industry faces today.  

So, with wine in hand and conference badges off, what did this room of industry leaders reflect on?

First, there was the inescapable economy.  Even the best of Bordeaux cannot erase the heavy weight of economic woe. With commodity prices increasing, foodservice leaders are once again faced with a struggle to cut costs at a time when their core costs are rising. It was agreed in most circles that night that the strongest weapon foodservice businesses have against cost creeping is supply chain knowledge and process excellence. The more efficient and informed your supply chain, the more control you have over costs.

The second great area of focus for the industry and the leaders who attended the tasting was value menu programs. In light of widespread shifts in how people spend and save money, industry leaders agreed that smart value menus will attract and retain customers. The challenge to these efforts will be a successful launch and management of these programs in the marketplace as well as the struggle to win the attentions of a stretched and stressed consumer base.

At ArrowStream, our foodservice clients have found time and again that one of the most effective ways to increase the success of value menu programs is to better partner and integrate with internal departments (such as marketing, distribution, etc.). The better coordinated internal departments are in planning, creating, launching and monitoring local market promotions, the greater the results are.

The final thought was really more of an affirmation that open dialogue among foodservice trading partners will lead to great achievements. If one simple wine tasting can have so many industry participants and leaders agreeing and collaborating, consider what the results would be of a more open, trusting supply chain.  Forums like these are essential to helping the entire foodservice industry work towards greater partnership and the eventual goal of widespread, strategic information sharing.

Establishing trust and common operational goals is the first step to successful foodservice industry supply chain data sharing as it focuses all parties on bottom line results rather than the small costs they can squeeze from their trading partners. While the goal of sweeping openness and trust across foodservice supply chains is a long-term and-some would argue-lofty one, it’s one well worth having because it will transform operations and expand profitability possibilities for the entire industry.  And that’s a goal well worth raising your glass to!

Lessons in Critical Supply Chain Issues for the Foodservice Industry 

At ArrowStream, we pride ourselves on being experts in our customers’ supply chain and business operations. We also know that there is always more to learn, which is why we host the ArrowStream Customer Conference each year. Who better to help us better understand the hard work and critical needs of supply chain management than our customers-the ultimate, inside-the-game experts?

On September 20^th this year, food service industry supply chain business leaders from across our client base gathered in Chicago to delve deep into the issues having the greatest impact on their operational efficiency and bottom-line success. Every one at the Conference learned-our service teams, our technology experts and even our clients walked away with numerous ideas on how to use supply chain management technology and resources to improve their businesses today and tomorrow, and to confront the challenge of the current recessionary market. I had an inspiration as ArrowStream has been working the lessons of the Conference into the solutions, services and tools we provide - “We should share these lessons and findings with the whole industry-our clients, those we want to be our clients, our partners and, yes, even our competitors because these insights can help us all make the entire supply chain ecosystem even better”

So here they are-the core findings of the 2009 ArrowStream Customer Conference. I hope this knowledge makes a positive impact on your supply chain planning, decision-making and results.  Given that every one of the participants uses ArrowStream’s software and data network a substantial part of the discussion centered on how to further use technology to enable scale, agility, and success in the supply chain.

Finding 1: Business Process Performance Is King
Our customers are competing in the toughest marketplace they’ve known. Customers wield enormous power as they look for the best value for their diminished pocket books. Foodservice business executives agreed that keeping costs down while meeting rising customer demands is the great, perplexing challenge they face today. How do you deliver the variety, value and safety customers seek and reduce costs?

To meet those demands, businesses must continue to increase and maintain the highest levels of operational efficiency. A foodservice company cannot achieve that goal without world-class supply chain management. Every point and every partner across the supply chain affects operational efficiency and the supply chain is the network of processes and people that unites them. A business would do very well to use the supply chain as a pathway to greater efficiency-analyzing each process and partnership across the system to ensure top performance, efficiency and results. Realizing the importance of this strategy, many of our conference participants are seeing investments in their supply chain organization remaining the same or increasing in 2010. Clearly supply chain has taken on new strategic importance in the face of the most difficult market of the last 25 years.

Finding 2: Overwhelmed by New Products & SKUs
At the Conference, business leaders also spoke to the common challenge of introducing and managing new products along the supply chain. One client said that they had introduced a record number of new products to the marketplace this year as they work to compete and win customers in this challenging economy. The difficulty, of course, is managing and tracing this rapidly expanding product portfolio, which puts enormous pressure on teams that are often already over stressed.  We discussed a number of examples where Technology was the key element in helping supply chain teams scale to effectively meet this challenge with little or no incremental overhead.  We also discussed how the same technology is helping all business operations manage and make the very best decisions in terms of new product management, costing, and delivery.  

Finding 3: Reducing Spoilage, Improving Traceability  
Restaurant chains that reduce spoilage and improve product traceabilty are safer, more responsive better foodservice providers in the minds of their customers and the industry. To achieve this essential goal, businesses need better data and far better integration with trading partners-especially with their global manufacturing partners and distributors. Bottom line? Businesses must integrate product management data up and down the entire supply chain to be able to quickly and effectively respond to food recalls and safety issues that could seriously damage customer confidence and the business brand.

Finding 4: The Technology Beacon
Technology has taken the central role in solving many of the issues today’s food service industry businesses face along the supply chain. Businesses will continue to look to technology to address their pressing challenges (such as traceability and spoilage reductions). The food service companies that are thoroughly integrating their supply chain systems and the rich data it provides into their organizations are going to lead the pack in industry innovation and establishing greater competitive advantage in the marketplace. Those that extend the reach and advantage of their supply chain management solutions to integrate trading partners will clearly be on the leading edge of this innovation. Our customers shared some of the innovative approaches they are taking to leverage our technology to address their challenges. For example, one customer had enrolled their distributors into the ArrowStream data network so that all ordering and receiving into their store locations was 100% electronic.  This resulted in tremendous labor cost savings and billing/pricing accuracy improvements for our customer.

Finding 5: Global Identification, Greater Efficiency
Almost all participants expressed a strong belief that a global identification standard would dramatically improve product management and logistics for all partners across the supply chain.  They all voiced strong support for GTIN standardization. While the global industry works towards GTIN standardization, businesses must rely on innovative supply chain technology systems that can consolidate diverse codes into a manageable, smart and effective supply chain management system. Businesses that do are winning big gains in efficiency over competitors who are still saddled with manual data entry and the cost of maintaining redundant systems just to keep pace with business flow.  In today’s marketplace, no one can afford the additional expense of multiple data systems and stores to manage their supply chain.

Because of their importance, we will be exploring some of these topics in great detail in upcoming blogs. The goal is to show how today’s technologies, and the increasingly strategic role of the supply chain, will help businesses meet and beat their toughest challenges. Until then, share with us what your greatest supply chain concern is or where you think technology needs to go to help foodservice businesses grow, innovate and lead in this difficult but opportunity-rich time.