Transportation, Distribution & Logistics for Competitive Advantage

1. Transportation, Distribution & LogisticsforCompetitive Advantage John Sullivan Director, Center for Advanced Manufacturing, Purdue University Scott Whitlock President, Flexware Innovation

2. Manufacturers that will thrive in the new economy will be the ones that innovate in • product, • process, • marketing and • distribution • “Without Innovation there is no life after lean” • Al Frink, Manufacturing “Czar” • Assistant Secretary for Manufacturing and Services • U.S. Department of Commerce SME Chapter 268 Presentation, 1/27/05

3. Indiana’s Competitive Advantage • Location, location, location • Crossroads of America • Rail, Air, Ports, Key Roads (N/S, E/W) • Strong Manufacturing Capabilities • Excellent Universities SME Chapter 268 Presentation, 1/27/05

4. To compete effectively inthe supply chain of tomorrow… • Lead time is critical • Technology is essential • Business environment must be flexible SME Chapter 268 Presentation, 1/27/05

5. What your Supply Network will demand • Glass Supply Chain – See Inventories • Product Information – Part of the product • Serialization – Aiding in Warranty & Security Issues • RFID & EPC Global Standards SME Chapter 268 Presentation, 1/27/05

6. Plan Supply Chain SCOR Model Main business processes Customer’s Customer Supplier’s Supplier Internal or external Internal or external Enterprise Customer Supplier Source Make Deliver D D S M S M D S Source; Pittiglio Rabin Todd & McGrath Supply Chain Council, Inc. Pittsburgh, Pennsylvania 412 781 3255 SME Chapter 268 Presentation, 1/27/05

7. Plan Supply Chain SCOR Model Customer’s Customer Supplier’s Supplier Internal or external Internal or external Enterprise Customer Supplier Source Make Deliver D D S M S M D S Source; Pittiglio Rabin Todd & McGrath Supply Chain Council, Inc. Pittsburgh, Pennsylvania 412 781 3255 SME Chapter 268 Presentation, 1/27/05

8. 2 1.9 1.8 1.7 1.6 ’54-’80 1.71 average 1.5 1.4 1.3 1.2 1.1 2004 1.24 1 1960 1958 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1998 2000 2002 2004 1996 The Manufacturing Supply Chain is EvolvingInventory to Sales Ratio for Manufacturing Source: Census Bureau SME Chapter 268 Presentation, 1/27/05

9. Indiana TDL Opportunities • Mass Customization • Customers are demanding customized products • Postponing final manufacturing/assembly improves profitability • Add value to products during distribution • Manufacturing operations located around distribution centers • Manufacturing operations located within distribution centers • Mobile Manufacturing Final Customization in Indiana The Crossroads of America SME Chapter 268 Presentation, 1/27/05

10. Processor Producer Stamping Warehouse SME Chapter 268 Presentation, 1/27/05

11. What do we need to do? • Engage in meaningful strategic planning • Both at the State and industry level • Increase our technological, financial and managerial strengths • Integrate our supply chains to reduce costs and improve performance • Get started with some pilot projects SME Chapter 268 Presentation, 1/27/05

12. Thank you! SME Chapter 268 Presentation, 1/27/05