The Wheatland Hop Was 100 Years Ago Today

And while it may sound like a new dance craze, it was actually a riot that took place during a strike on the Durst Ranch in Wheatland, California that resulted in four deaths. It was among the first major farm labour confrontations, blamed on the radical syndicalist trade union of the Industrial Workers of the World, and a * example of what an organization can expect if it tries to take advantage of poor workers in developing, and more importantly, emerging countries or, even worse, workers at home by trying to force interns and low-salaried workers to work long hours for little pay and no benefits.

As per the Wikipedia entry, in the summer of 1913, Durst advertised for temporary workers with a promise of ample work at high rates of pay for every hop picker that arrived on the farm by August 5. In this particular year, the supply of willing workers almost doubled the demand, and Durst slashed pay rates. To make matters worse, not only were workers on his farm making roughly half of what workers on other farms were making (for toiling twelve hours a day in fields that could reach 110F / 44C), but the workers were forced to live in tents on a barren hillside that they had to rent for 75c/week when they made, on average, $1.50 a day with drinking water a mile away and unspeakably unsanitary toilet conditions. And to add insult to injury, Durst retained 10% of the earnings until the end of the harvest, and only paid it out if the workers stayed until the end of the harvest.

It was only a matter of days before a temporary local chapter of the IWW was organized that demanded a better pay rate per lb of hops picked, worker supervision of measurement of the hops, provision of drinking water in the fields, improved toilet facilities, and assistants to help women and children load and unload heavy hop sacks. Durst responded that toilet conditions would be improved, water would be provided in the fields, and one worker could be allowed to witness the weighing process. The local chapter of the IWW then threatened a strike. Durst responded by calling the sheriff (who could not do anything for lack of an arrest warrant). By the end of August 2, a mass meeting for all of the workers was planned for August 3. On the 3, with a mass meeting underway, Durst went into town to gather authorities to put down the revolt. The sheriff, a number of deputies, and the district attorney was pulled into the ranch.

Upon arrival, shortly after the mass meeting had begun, the sheriff and his men tried to arrest the leader of the of the local IWW chapter, but workers intervened. In response, one of the law enforcement officials fired a shotgun into the air, which was taken as an act of aggression and which prompted a full-fledged riot and an attack on the sheriff, the deputies, and a district attorney.

Unfortunately, instead of being a warning siren for other farm and ranch owners that used migrant workers, it was only the first of other bitter strikes between California growers and farm workers that would take place over the next couple of decades.

In a nutshell, Corporate Social Responsibility is more than just good PR, it’s good business.

Will Darrell Issa Save the Post Office? Or Put Another Nail in the Coffin?

Early last week, Darrell Issa, a Representative of California and chairman of the the US House Oversight and Government Reform, signed off on H.R. 2748, the Postal Reform Act of 2013 which is designed to bring the United States Postal Service (USPS) to financial solvency with cost-cutting reforms and innovative new sources of revenue.

SI has been asking if the US Post Office can be fixed for a while now, with its most recent post on the subject last summer (Source). Given that the USPS has more debt than 50+ countries have capita, fixing it is a tall order – especially when the US needs to identify immediate savings of almost 20 Billion plus (as it keeps bleeding red with losses of 15.9 Billion in 2012 and 3.2 Billion in the first two quarters of 2013).

Key points of the plan, as summarized in this Logistics Management article, include:

  • moving from door to curbside delivery and neighbourhood boxes, which could save 4 Billion annually,
  • ensuring small and rural post offices are protected from a disproportionate number of closures,
  • creating a Chief Innovation Officer,
  • protecting existing collective bargaining agreements,
  • recalculating projected liabilities for employee pensions, and
  • offering additional relief from retiree health care benefit payments.

While SI has to say it likes the first and third options, that’s not going to be enough to generate the savings required giving that costs are going to keep rising.

SI agrees with Rob Martinez, President and CEO of Shipware Systems Corp, cited in the Logistics Management article, who noted that a comprehensive plan that addresses multiple options is required if the USPS is to become solvent again. However, SI’s approach, which differs from Mr. Martinez’s, would involve the following:

  • maximization of neighbourhood box and curbside deliveries,
  • an immediate end to Saturday mail delivery,
  • global restructuring and consolidation of postal facilities until all are at least break-even*,
  • freedom to revise operational practices to take advantage of savings identified by Procurement and new sources of revenue identified by Marketing and Innovation, and
  • freedom to enter into co-opetition agreements with the major private delivery companies to share resources and routes, for both long-haul and last-mile deliveries, in ways that save both parties money.

SI does not agree with eliminating the pension prepayment mandate, freeing up a percentage of pension funds to ensure ongoing solvency, or cutting contributions to retiree health benefits. Not sufficiently funding these payment obligations is what got the USPS, and a whole bunch of other public and private organizations, into this mess in the first place. (However, SI fully supports a careful recalculation of the unfunded liability to make sure the payments do not exceed what is required.) Plus, it’s the USPS after all. Congress, who dumbly vetoed elimination of Saturday mail delivery, isn’t going to stop lending the USPS money until they find a way out of this mess, so it’s not like the USPS has to worry about bankruptcy. The USPS has to get it right, not exacerbate the problem.

And in SI’s view, the current plan will not save the post office and may even put a nail or two into the coffin because every provision except the provision to move to neighbourhood boxes and curbside delivery is likely to increase costs in the long run.


* SI agrees that every town needs a postal facility and that anyone in a rural area should have a post office within a reasonable distance, but doesn’t agree that this means that existing facilities stay open. They may need to be reduced in capacity and change locations. For example, here in Canada, many locations are sublet in retail establishments, and drug stores in particular (which are open long hours). These micro locations can be staffed by one person and cost next to nothing.

A Customs Audit is Coming Your Way – Are You Ready?

As per this recent post over on the C.H. Robinson blog, the U.S. Customs and Border Protection (CBP) is stepping up enforcement of customs compliance. It’s not just looking for fraud, but for poor record-keeping, mistakes, and uncorrected discrepancies that will allow up to impose fines of up to $10,000, penalties of up to 8 times the value of the loss of duty on dutiable items, and penalties of up to 80% of the value of non-dutiable items which allow the CBP, and the U.S. Government, to fill its coffers at your expense. Just like ignorance of the law is no excuse, neither is an innocent mistake.

And while you can’t prevent an audit, you can prevent a fine and a penalty by making sure you don’t make any of the nine-common trade-related errors the CBP will get you on and, in a few cases, taking extra steps to limit what can be held against you. To minimize fines and penalties,

  • Report Manufacturing Assists which are dutiable (at cost).
  • Have a system and process in place to verify the mainfest immediately after the ship is loaded.
    If there are additional, missing, or damaged items, and the price is modified, the price you are actually going to pay needs to be reported.
  • Be sure not to include dutiable costs! While you will be refunded duty overpayments, you can also be fined $10,000 for a record-keeping error!
  • Don’t screw up the country of origin. It’s not necessarily the exporting country. It may ship from China, but it could be manufactured in Myanmar and Vietnam.
  • Get the HTS code right. Hire a consultant or acquire an import trade tool if you have to, because if you get this wrong, here’s where the 8X penalty comes into play!
  • If claiming Free Trade, make sure you have the arguments, documentation, and, if they exist, previous determinations or rulings to back it up.
  • If you are re-importing goods into the US (HTS 9801 & 9802), be sure to have tangible proof of US manufacturing and a full chain of custody that demonstrates no advance while abroad.
  • Don’t screw up the amounts claimed in a related-party transaction.
    Just because you trade goods for $1 does not mean this is the value you can claim when calculating duty.
  • Keep exactly 5 years of records. You have to keep five years, or get fined, but if you have more than 5 years, you are just giving the CBP more records to go through to find problems.

Will this completely eliminate your risk? No, but it will greatly reduce it!

3PLs, Make Your Deliveries Click with Airclic

Real-time package tracking, routing, and route optimization isn’t new, as the big global delivery companies have been doing it for a while now, and neither is Airclic’s Transport Perform solution, but its tight integration with their new Route Planning and Route Optimization solutions, their enhanced support for multi-national organizations and international routes, and their improved end-user configurability is.

SI doesn’t review real time vehicle tracking, route management and last mile delivery software very often as it is not core Supply Management functionality for the average enterprise, that typically outsources this aspect of Supply Management to a 3PL which has this solution in place, but Airclic’s recent incorporation of support for simultaneous high-volume cross-docking, multi-driver cross-border routes, their new web-portal that makes their platform as easy to use as a multi-tab spreadsheet, and extensive configurability options attracted our attention.

One fact that comes through loud and clear in a review of their solution is that they understand the importance of a clear, easy to use, non-distracting, straight-to-the-point interface for dock workers and truck drivers, especially when all these people have is a small, primarily text based, mobile device. The application, which can be pre-configured with relevant supplier data, including whether the supplier is ASN-based or non-ASN-based (Advance Shipping Notice), allows the application to be customized to each supplier so that a dock worker or driver only has to enter the absolute minimal amount of information (which, for an ASN-based supplier, can be as little as scanning a barcode) and when additional data has to be collected, is presented with a minimal list of options to choose from. For an average ASN supplier, it’s select the supplier, scan the barcode, and, if the item is damaged, check a box, record the reason and, optionally, upload a picture. For an average non-ASN supplier, it’s select the supplier, enter the piece or item ID, an (optional) container ID, and destination. The application supports receiving, loading, migration of pieces/items to containers, container consolidation, returns, and depot transfers for dock workers and route selection, stop identification, pick up, deliveries, returns, depot drop-offs (for undeliverable items) and unscheduled customer stops for drivers. All data is collected and transmitted in real time to the web portal over the cellular network and updates and alerts are transmitted back to the driver in real time. In addition, alerts can automatically generated and sent to the supplier when a driver is getting close to their location.

Their web-portal allows the dispatcher to see the current status of every route, driver, dock-worker, shipment, and item. The routes are simultaneously displayed in text view and on a Google Map and either option can be used for drill-down. The interface allows the dispatcher to make changes in real time, and updates the drivers and dock workers as appropriate. If the organization has a route optimization solution, it can be integrated with the solution and optimized routes pulled in on the fly. If the organization does not have a route optimization solution, the dispatcher can manually define new and altered routes or use Airclic’s route optimization solution.

The built-in reporting is very extensive, with just about every report (template) that a dispatcher will need. There are route and route item reports, full chain of custody reports, complete item history reports, proof of service reports, inventory reports, order reports, GPS and container tracking reports, damage reports, route reports, stop reports, etc. They can be automatically generated and directed to the right individual.

But the best part of the solution is the administrative panel. Everything is configurable at a very fine-grained level of detail. Groups (which correspond to different regions, divisions, or locales with different operating rules), users, locations, handsets, workers, internationalization, routes, loading and delivery processes, can be defined and customized as needed – and the right version of the application that is localized for the driver and delivery location can be delivered to the right handset every time. When a truck is handed off from an English speaking driver to a Spanish speaking driver after a border crossing, the application can be configured to be smart enough to recognize the changeover and deliver the Spanish version for the Spanish handset pre-configured with the delivery options for the Mexican market. A multi-national will a lot of trucks, drivers, pick-up, and delivery locations will have to invest the time to integrate with it’s current Supply Management solution and to configure the Airclic solution to the appropriate level of detail, but it’s easy to see how a 3PL will easily save 400/month per truck. That savings, which approaches 500K a year for a 3PL with 100 trucks in its fleet, adds up fast!

Kinaxis – A New Paradigm for Real-Time End-to-End Supply Chain Management! Part III

In Part I, we re-introduced you to Kinaxis, one of the most interesting companies in the entire Supply Management space. Billing themselves as a platform for Rapid Response designed to assist supply chain professionals in managing their change-ready supply chains, Kinaxis is actually a very extensive, but deftly integrated, end-to-end cross-functional supply chain what-if platform designed to help supply chain professionals determine how to respond to various unexpected situations. As discussed in Part II, by integrating all of your cross-functional Supply Chain Management applications into one centralized control center application, it has the unique ability to not only optimize production, distribution, and supply network models but to also allow a user to create what-if scenarios in real-time that will allow the user to, among other things,

  • model current, projected, and variations to, demand,
  • plan how production would have to ramp up, down, or shift to meet demand,
  • determine what the impacts would be to other customers if a preferred customer’s order was filled sooner,
  • understand the impacts to inventory and production if a certain raw material or part were unavailable for a short, or long, period of time,
  • comprehend the impacts to new product development and introduction of there is a delay in production, raw material acquisition, distribution, or if marketing wants to introduce a last minute change, and
  • manage the change process associated with demand, inventory, development, or production changes.

The Kinaxis platform does this, and more, because they believe that the key to not only surviving, but thriving, in today’s dynamic, constantly changing, and constantly interrupted global market is to know sooner, act faster. When it takes two days to understand what the impacts of a supply disruption of a material already in short supply will be, that’s too long (as the chances are that your competitor will have locked up the remaining supply before your organization even realizes it needs it). And when it takes a week to understand what the impact of a requested feature change by marketing will be to new product development, that’s too long (as the decision will always be ‘no’ because delaying production will be too risky – and if that results in a key-feature being left out, like e-mail on the Playbook, the resulting lack of marketshare could be devastating). And if you can’t tell your marquis customer whether or not you can expedite their order the day they call, that’s too long (as the end result is that they won’t be a marquis customer for long). That’s why the Kinaxis platform was built to allow these business critical questions to be answered within two-hours or less, on average (in the hands of a knowledgeable user). Many simple questions (such as what if I add this order, change this ship date, or expedite this order) can be answered in just a few minutes — and the full details as to why can be understood in under an hour.

And now the Kinaxis platform does this on a global scale. When SI first reviewed Kinaxis, it was primarily deployed in the English speaking world and single currency. Now, with offices in North America, Asia Pacific, and Europe they are deployed globally in multiple languages and support multiple currencies. In addition, they have added mobile (tablet) support so users can access the application on-the-go, in-the-plant, and on-site when a disruption is detected and has to be dealt with. Furthermore, all of the data is accessed in real time in both the mobile app and the main application. This is another powerful enhancement as what-if scenarios can be re-run as soon as data is updated in the ERP, Inventory Management, or Operations Planning system. No more waiting for the regularly scheduled sync.

Other key enhancements include namespaces, which allow different environments to be set up for different processes, geographic locations, or what-if scenario sets; integrated project management that ties together the project management capabilities of both the Kinaxis platform and the integrated applications (that are already supported by Kinaxis which supports all of the major ERPs); attribute-based planning; variant Bill-of-Materials support which allows multiple options to be considered simultaneously; “fair-share” constraints and additional constraint modeling capability; and process orchestration (that makes sure processes that are supposed to happen in sync happen in sync and those that are supposed to happen in sequence happen in sequence) that allows processes and activities to be defined and compiled in a logical, project-like, manner (that is intuitive to anyone used to using traditional project management tools).

What Kinaxis has built is a framework for modern enterprise-class end-to-end Supply Chain Management through a consolidated control center. It doesn’t replace your ERP, e-Sourcing, e-Procurement, Logistics and Transportation Management, Warehouse and Inventory Management, Trade Management, SRM and Visibility solutions — it allows you to take your operations to the next level by orchestrating their capabilities in an entirely new way (and, in fact, the Kinaxis system won’t reach it’s true potential unless your organization has most, if not all, of these systems in place). If all you have is a suite of best-in-class Supply Management applications, even if each application is 2.0, or even approaching 3.0, your Supply (Chain) Management organization as a whole is still 1.0 as it hasn’t mastered true process orchestration and functional collaboration. This is what Kinaxis gives you, if you are ready and prepared to embark upon the journey.