I attended as many talks as I could manage in the three and a half days that I spent at the worlds largest Operations Research / Management Science conference (separated by meetings with some local companies), and as a result I learned the following:

1. Under the right model:
   • centralized models of production, decentralized make-to-stock models of production, and decentralized make-to-stock models of production can all be highly profitable
   • sole sourcing is not always the right option
   • but sometimes sole sourcing is the right option
   • when supply chain participants collaborate and share processes, higher customer satisfaction can result
   • better information leads to lower costs
   • shifting inventory to the right supply chain participant can save everyone money
   • large distribution networks are often bloated and inefficient
   • increased flexibility often leads to increased cost and profit loss
   • lean supply chains can be very profitable
   • but sometimes modular supply chains with more inventory are more profitable
   • a complete characterization of potential supply chain risk is challenging
2. Abstract, strategic, “big picture” thinkers often solve problems faster and better than concrete, tactical, “current crisis” thinkers.
3. Decreasing customer returns increases profit.
4. OEMS can profit greatly from secondary markets and those that try to shut them down might be severely jeopardizing their business.
5. Good supply chain planning is key to good disaster readiness planning.
6. 1 in 5 outsourcing relationships are doomed to failure because they favor the client at the expense of the vendor from the outset
7. Highly skilled individuals prefer solutions with moderate amounts of complexity.
8. The benefits of centralization realized depend on commitment levels.
9. If you want to sell your solution, focus on the benefits, not the features.
10. Manufacturers benefit from innovative customers.

Well, as you probably guessed, I did not actually learn the above, but I did learn that academics now have solid mathematical models that explain why us practitioners have observed each of the above “teachings” offered by various talks that I attended. Don’t worry, I’m not going to bore or confuse you with the models, but simply point out why each of these is true from a “common sense” viewpoint.

1. • different production models can be highly profitable
     it really depends on how lean your supply chain is
   • sole sourcing is not always the right option
     it is often a risky proposition
   • sometimes sole sourcing is the right option
     since dual sourcing can often be costly
   • higher customer satisfaction results from collaboration
     do you pick out your wardrobe with your eyes closed?
   • better information needs to lower costs
     better forecasting alone saves you money
   • properly placed inventory saves money
     it costs money to move improperly placed inventory around
   • large distribution networks are often bloated and inefficient
     if JC Penney needs less than 10 DCs in the US, how many do you need
   • increased flexibility often leads to increased costs and profit loss
     the more versions of a product you have, the less likely you are to sell a large quantity of any particular unit, and profits, like economy, come with scale (and each different variation has its own setup and teardown production costs)
   • lean supply chains can be very profitable
     in fact, they can be more profitable than you think
   • sometimes modular supply chains with more inventory are more profitable
     if you have to shut part of your supply chain down waiting on inventory, you’re losing money – the right amount of safety stock at each location can prevent this
   • complete characterization of potential supply chain risk is challenging
     you can never come up with and plan for more than a finite number of possibilities but in real life, an infinite number of things can go wrong
2. abstract, strategic, “big picture” thinkers are better problem solvers
   a “big picture” thinker is less likely to sacrifice better opportunities tomorrow for good opportunities today
3. decreasing customer returns increases profit
   customer returns decrease profits, so reducing them increases profit
4. OEMS can profit greatly from secondary markets
   considering how much today’s high-tech equipment costs, a company is a lot more likely to invest in a solution that has a decent resale value
5. good supply chain planning is key to good disaster readiness planning
   if you do not know what is critical to your operations, then you do not know what to prepare for
6. 1 in 5 outsource relationships is doomed to failure from the outset
   considering the less than stellar returns from many outsourcing projects, this should not be a surprise
7. highly skilled individuals prefer solutions with moderate amounts of complexity
   after all, using a simple solution does nothing to demonstrate your capabilities
8. benefits of centralization realized depends on commitment levels
   an unsupported initiative never works (and center-led is probably more effective anyway)
9. focus on the benefits, not the features, in solution selling
   with the exception of those few individuals who have to use the solution significantly in their daily tasks (who are usually not the decision makers), no one really cares how cool it is to use – they care about how effective it is at solving their business problem and saving money
10. manufacturers benefit from innovative customers
    innovation helps everyone