Solution provider Enporion announced that it has done a successful SAS 70 audit, an independent auditor's review of its e-commerce supply chain management hosted solutions, Supply and Demand Chain Executive reported.

The Statement on Auditing Standards (SAS) No. 70, Service Organizations, developed by the American Institute of Certified Public Accountants (AICPA), is an in-depth audit of a service organization's control objectives and activities, including controls over information technology and related processes. Application services providers (ASPs), as well as software-as-a-service (SaaS) providers, such as Enporion, must demonstrate that they have adequate controls and safeguards in place when hosting or processing customer data.

One of the issues many supply chain managers are facing, especially when designing or changing the supply chain network is where to locate the facilities. Well, I was thinking of creating a sample and simple! checklist on this. I myself think some of the most important criteria to make this decision are the answers to the following questions:

1) Are the sources of supply concentrated in a few geographic areas? (If yes, locating facility near them might lead to cost savings. A good example is facilities which make products using steel; it makes sense to be near the source of supply).

2) How high is the cost of shipment for products from the supply areas? (With rising fuel prices, this factor becomes more important).

3) Are customers located in a few geographical areas? (If the customer base is highly concentrated, then maybe it makes sense to make the products near them)

4) Do you follow a postponement strategy for most of your markets? (If we are following the postponement strategy, then it's good to be centralized in between final destinations to minimize the transport and cost to serve. Here I assumed that final destinations have roughly similar level of demand).

5) Are there other companies with which you could combine shipments and facilities?

6) Are the potential areas high risk in terms of natural disasters?

How about you? Do you have more elements to add to the preliminary list of mine?

Dr Patrick Dixon, the futurist and management professional, recently gave a keynote speech on how to speed up supply chain and logistics. My evaluation of his talk: IT'S VERY INTERESTING...

I found the video of his talk and below you can see the first part.

Supply chain and operational efficiency and synergy is the motivation for many of the M&A deals today. However many of such benefit estimation don't materialize after the deal. There are a variety of reasons behind this problem: Typically the estimations are too high-level and don't take into account what really works and what not (sharing the warehouses for example takes time but changing the supplier can usually be done in short term).

Andy Sealock and Marc Tanowitz from Pace Harmon, have recently written an article in Supply and Demand Chain Executive and talked about their approach to attach M&A problems regarding SCM. In their point of view, a plan including elements below should be developed well ahead of the deal:

Step 1 - Determine Synergy Initiatives
Step 2 - Prioritize Initiatives Based on Business Impact
Step 3 - Develop Resource and Synergy Capture Plan
Step 4 - Execute the Synergy Capture Program

For example in the third step, the series of actions which should be looked at include:

Estimated Savings - the most direct measure of synergy value and generally given the most weight of all criteria
Spend - often used as a proxy for savings if savings cannot be predicted with an acceptable confidence interval
Speed of Savings Capture - the payback period or time required for synergies to be realized as a result of the project
Resources Required - the full time equivalents (FTE) personnel or other investments required to execute the synergy initiative
Business Impact - importance placed by the business on meeting the completion date for the project.
Stakeholder Buy-in - degree to which business stakeholders will advocate for, support and provide sufficient resources to execute the project successfully

I will write more about this subject this week.

Aldata Solution announced at the FMI Show/Marketechnics that Price Chopper has selected the Aldata G.O.L.D. Retail Supply Chain Suite to centralize merchandising and procurement and to improve replenishment management operations across its 116 stores.

Supermarket News reported that the Northeast grocer anticipates leveraging Aldata's Product Information Manager (PIM) module to better manage item and vendor data by enabling vendors to enter their data in to a vendor portal. Price Chopper is contracted to implement the G.O.L.D. Topase module for demand-based replenishment and the G.O.L.D. Mine business intelligence system to gain real-time visibility into factors such as enterprise inventory management, internal operations and competitive activity.

The 10th Annual European Supply Chain & Logistics Summit, is going to host a number of big names this year. The ones which are already confirmed include:

- Head of Manufacturing - Pirelli
- VP of Purchasing - Michelin
- Supply Chain Director - Mars Snackfood
- European Logistics Manager - Honeywell
- European Purchasing Manager - HJ Heinz
- Head of Global Planning - British American Tobacco

Supply Chain Risk Management and Reverse Logistics are among the topics which will be covered in great detail. You can go to www.supplychain.eu.com for more information.