Material Handling Rocks!

Mass customization takes on new meaning as artists customize guitars in Cleveland.

Material Handling Rocks!

Mass customization has as many definitions and forms as practitioners. We’ll take a more serious look at the subject in our November issue. Meanwhile, here’s a groovy story about how mass customization helps raise money for charity, and takes art to the streets. Cool.

The definition of mass customization used to be — The customer can have any color car he wants, as long as it’s black. Not so at Prewitt Fiberglass Animals. For Prewitt, mass customization means making lots of anything and letting an artist customize the job. The company has been creating nearly life-size fiberglass animals for more than 30 years — horses being its specialty. The company has a stable of about 50 creatures champing at the bit, ready to go. You’ve probably seen its critters in western-wear shops, restaurants and similar places. When the craze for putting large animals on the street and having them painted by artists for charity began a few years ago (Zurich, Switzerland, is credited with starting the phenomenon in 1998 with life-size alpine cows), Charlie Spencer, owner of Prewitt Fiberglass, found himself riding high, wide and handsome. He’s made cows for Chicago, horses for Lexington and fish for Baltimore — to name a few.

Cleveland, however, is different. We don’t have a logo-animal — but we do have rock ‘n’ roll. “We knew how to do animals,” Spencer tells me from his shop in Gibbon, near Kearney, Nebraska. “But guitars were a bit different. Getting those strings on was a challenge, but we liked that,” he says with a chuckle.

The Cleveland project started in late 2000. One of the companies singing the praises of this project was Sedlak Management Consultants, an internationally known material handling consultancy headquartered in suburban Richfield, Ohio.

“We recognized the benefit to charity and the potential for getting our name in front of the public,” says Pat Sedlak, Sedlak Management Consultants. “Because we signed up early in the game, we made sure we got preferential placement of our guitar in the lobby of the [Cleveland Hopkins International] airport,” he says. Sedlak’s local clients, like American Greetings, Sherwin-Williams and Jo-Ann Stores, also jumped on the bandwagon. About 100 brightly painted guitars grace the streets of Cleveland this summer.

I asked Spencer how mass manufacturing guitars differs from one-of-a-kind animals. He tells me that building the first guitar took about five months. “After that, we had the mold and making the next 100 or so was easy.” The company worked from original blueprints of the legendary Stratocaster (used by greats like Buddy Holly, Stevie Ray Vaughn, Bonnie Raitt, etc.) provided by Fender Musical Instruments.

“The original Stratocaster was about three feet long,” says Spencer. “We were making a replica 10 feet tall and bolting it to a cement base.”

The list of luminaries brought together for painting the guitars reads like a lineup for ... well, like no lineup ever assembled. Folks like Drew Carey, Yoko Ono, Peter Max, Graham Nash, Keith Richards, Omar Vizquel and many others have expressed their feelings about Cleveland on these unique canvases. Sedlak’s guitar, called My Blue Cleveland, was painted by local artist Ron Hill.

For Spencer, material handling for mass customization has not radically changed the way he does business. In fact, it sounds like he does it right from the start.

“We’re not ordering material in bulk, yet,” he says. “We still order what we think we’ll need for a project to keep the inventory down.” Spencer foresees the mass-customized animal phenomenon continuing. He projects increases in his business for the next five or six years.

The guitars will be auctioned in November to raise money for the sponsoring charity organizations.

Clyde E. Witt, executive editor

Should Logistics and Marketing Merge?

The state of the U. S. business logistics system is extraordinary, says Robert V. Delaney, Cass Information Systems Inc., in his 13th annual “State of Logistics Report.” Last year, he notes, U.S. business logistics costs declined by $33 billion compared with 2000. This was the first decline since 1991. Logistics costs were equal to 9.5 percent of nominal gross domestic product during 2001. That is a record low in the history of the data.

Inventory investment was reduced during all four quarters of 2001. Even more remarkable, the changes in inventory were also negative during the third and fourth quarters of 2000. So, we have experienced six consecutive quarters of declining inventory investment, Delaney reports.

To help illustrate the dynamics of inventory management, Delaney cites comments from Roger Urban, principal of Urban Wallace Associates, a firm that concentrates on business strategy and operational marketing issues.

Urban recently joined Delaney in a meeting with Ohio State University’s Supply Chain Management Research Group in Columbus, Ohio. This group has studied the efficiency of raw material, work in process and finished goods inventory for more than 8,000 public companies based on their financial reports to the Securities and Exchange Commission. Based on the group’s findings, Urban concluded that agility, accommodation and flexibility are the keys to survival for supply chain managers. The emphasis is on constant adjustment today, not optimizing on yesterday’s data.

To read Delaney’s complete “State of Logistics Report,” go to www.cassinfo.com and click on “Delaney’s Dugout.”

Editor’s note: The Ohio State University’s Supply Chain Management Research Group can give you a benchmark analysis of your inventory performance compared to competitors, citing the implications for corporate profitability. For more information on this service and on the group’s report, go to Fisher.OSU.edu/scmrg.

Supply Chain Process Management Shows Growth

The supply chain process market experienced dramatic growth between 2000 and 2001. Year-over -year growth of 83 percent was achieved. The updated ARC Advisory Group study, Supply Chain Process Management Worldwide Outlook, is forecasting cumulative average growth rate (CAGR) of 53 percent through 2006 while growing from $170 million in 2001 to just over $1.4 billion by the end of 2006.

Supply chain process management (SCPM) is used to identify and proactively resolve problems in real time. An application monitors the extended supply chain and provides event alerts (for example, a shipment has not left the supplier within a preset time) and key performance indicator alerts (fulfillment throughput in the distribution centers has fallen below a preset parameter) to help synchronize the supply chain. This market also bridges the gap between supply chain planning and supply chain execution. Alerting can be by e-mail, phone or pager.

Center Of Excellence Formed

Marconi InfoChain, an asset management solutions provider, announced a collaboration with leading consumer goods and technology firms to found a Center of Excellence. This forum will explore and develop opportunities for the application of radio frequency identification (RFID) technology within consumer goods supply chains.

Joining with InfoChain are RedPrairie, Intermec, Georgia-Pacific, Unilever, Kimberly-Clark and CHEP. The strategic partnership of complementary technologies will promote research and analyze the results of major pilot projects designed to test optimum application of RFID functionality and benefits within the supply chain.

“We are looking at how RFID can streamline collaborative planning, forecasting and replenishment [CPFR],” said Paul Witt, Marconi InfoChain vice president of business development. “The Center of Excellence will help drive this process to establish a benchmark in productivity.”

Currently, the center is working with scientists at the MIT Auto-ID Center to validate the use of RFID tags for inventory visibility and tracking. Testing involves distribution centers that support Sam’s Club and Wal-Mart stores. With RFID, information can be updated with encoded microchips, often 40 times faster than with bar code-based systems. Data, gathered from RFID tags applied to pallets at distribution centers and read at stores, can boost supply chain capabilities by helping to get product to the shelf.

USPS Cites Cost-Savings Through Material Handling

A senior postal official detailed the success of new “intelligent” flat mail sorting equipment that deciphers hard-to-read addresses while sorting three times as fast as previous equipment. The system, known as the Automated Flat Sorting Machine 100 (AFSM 100 from Siemens Dematic), will save the Postal Service $292.5 million this year.

In making his presentation during the Board of Governors monthly meeting, Walter O’Tormey, manager, processing operations, reported that the two-year nationwide deployment of 534 AFSM 100s that began in April 2000, and placed equipment in 239 mail processing facilities, has been completed.

“One of the Postal Service’s long-term goals is to move flats processing — traditionally one of the most labor intensive — from a manual and mechanized environment to one that is automated,” he explained. “The Automated Flat Sorting Machine 100’s innovative design offers several features not previously available, including automatic feeders, a tray take-away conveyor with adaptability to robotic handling, and on-line video encoding for processing non-readable flat mail images.”

Ford Leads with Emissions-Certified Industrial Engines

Ford Motor Company has received emissions certificates for all fuels in its two most popular industrial engines. The California Air Resources Board (CARB) has certified that Ford’s 2.5-liter and 4.2-liter engines meet emissions standards for all fuels (gasoline, liquid propane gas and natural gas), operating under 4,000 rpm. The certifications also apply to engines equipped with the new Ford Engine Performance Module (EPM).

“We are the only manufacturer to be certified on all fuels for the broad industrial market to date,” said John Andreas, director, programs and engineering, for Ford Power Products. The new certifications apply to 2002 model year production. These engines, as well as the new Ford EPM, are now available from Ford Power Products distributors. Primary markets for these engine packages include airline ground support equipment, sweepers and mobile generator sets.

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