IFFA – What a show!

I don’t know what it is with these European Trade Shows, but I must tell you that I made more and better North American contacts at IFFA than any other major show in North America. Makes you wonder why that is. Here is my crack at it.

I believe that a tradeshow for manufacturing equipment and supplies happening in three year intervals has clear advantages. Exhibitors as well as Attendees make an extra effort to make it a success, and innovations in that segment are not as blistering fast as e.g. in technology.


As a result, Exhibitors provide their full line-up of equipment to touch and feel and see in in action. They are present for 6 days, 9 hours each day to answer your questions – and they bring everyone, sales people, product managers, engineers and maintenance staff. Everyone that provides something meaningful for the global meat industry is present at the show, as the more than 60,000 attendees prove.

Attendees know years in advance about the event. For meat executives it turns out like a pilgrimage to the latest innovation, which they normally combine with visits to the research and development centers of the leading German equipment manufacturers for sausage production, the Dutch and Danish slaughterhouse automation specialists etc. There is just no other location in the world, where so much skill and knowledge can come together.

Not only knowledge comes together. Vendors as well. The main theme of the show was around automation. On basically any booth at the show, you were able to see how information systems integrated, controlled and managed equipment. Whether it was Robotics and fully automated pack lines or simpler integration of equipment to monitor Overall Equipment Efficiency (OEE) – the trend is clear. We cannot look at any of our systems, whether these are computer systems or manufacturing systems, isolated anymore.


As an attendee, you are actually working this show different. There are hardly any educational sessions provided by anyone. You can find all the education on the floor. Let’s face it – if it is not commercially available, you cannot use it. Here you can work the floor, get solid education of competing technologies and interface right then and there with other partners to develop uniquely designed automation concepts for your business. You literally wind up getting more and better education, where you can decide al`a carte what to learn, how to learn and from whom to learn. It almost feels like a live version of the internet, where everything is connected and you hyperlink from one booth to the next – it just takes way longer to walk than to click.

I still believe that there is some value in the smaller educational conferences the ones that NAMA, CMC, US Poultry & Egg etc. provide. Especially if the educational program is led by industry leaders, scientific leaders and great speakers in general. We need to think though about frequency and duration of these shows, and we need to think what exhibitors pay for and what they don’t. The US concept of filling the coffers of certain trade associations via vendor’s booth fees lead to the demise of some shows already. On the other hand, the only show that is at least in attendance still growing in North America is the Process Expo – hosted and paid for by the vendors to the food industry. The process expo is closer to the concept of the European tradeshows, and perhaps herein lies their success.

I really look forward to the next major shows for the year. In October is the biannual Anuga Show in Cologne, which expects to see between 150,000 and 200,000 executives within the food manufacturing, food distribution and grocery retail arena for 5 Days in October in Cologne. This will be followed by the largest North American Food Equipment Show, the Process Expo in Chicago in November. I hope to see you there, and I hope that these exciting tradeshows provide an example for others to follow.


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Getting Ready for @IFFA_Frankfurt 2013!

Every three years the global meat industry descents over Frankfurt, Germany. With about 60,000 attendees, IFFA Frankfurt does not compare to anything other meat industry event in the world. Because of this large audience and its global reach, vendors to the meat industry make an extra effort to sell their products and services to members of the meat industry: new products are developed and introduced at IFFA, displays are larger and more complicated and the staff at the booth’s is absolute first class – no questions are being left unanswered.


The format of the show is also a lot different than what we are used to in the United States. The show runs 6 days straight from 9:00 am to 6:00 pm every Day. Most of the larger exhibits have full catering at their booth, providing snacks, lunches, beverages making each visit to a vendor a lengthy but productive experience. I think it is fairly common, that people spend 1-2 hours at a booth getting informed about a product they are really interested, and I have seen cases where someone came in the morning, stayed all day – and came back the next day.

IFFA is about getting business done. You work the show until you have all the facts, know everything there is to know and you can move on to making important business decisions.

I will leave on Tuesday for Frankfurt. My IFFA Tour starts with a practical seminar with meat executives from 5 continents attending at EDEKA Rheinstetten, one of the world’s most modern meat processing and distribution facilities. I will give a talk about cut planning, yield management and cut-out values in a facility that has a 2 hour supply of hogs in the holding cooler and needs just in time purchasing planning and cut room management.

I will then move to IFFA Frankfurt, where you can meet me at the booth of CSB-System in hall 11.1, B81. This year, we have one of the largest exhibits we ever had at IFFA. We will show how computer technology specialized for the meat industry provides efficiencies, cost savings and costs avoidances top-floor to shop-floor, farm-to-fork. Among the topics we will cover are:

  • From maintenance management to overall equipment efficiency: how you can monitor what is happening on your floor and anticipate issue long before they actually occur.
  • From individual animal traceability to batch traceability: how you can deploy traceability concepts based on your needs, your legal requirements and your individual budget based on GS1-Standards.
  • From basic operational reports to actionable Business Intelligence (BI) delivered to you anywhere, any time on any device you own.
  • Optimized general processes like order-to-cash with customer self-service web sites, digital archiving, automated picking and shipping, freight costs optimization and even automated cash application.
  • Optimized meat specific processes for Country of Origin Labelling (COOL), cut out value optimization, least costs formulation, nutritional value calculation, ingredients list management and much more!
  • Automation concepts from automated overhead rail transportation systems, silo management, automated tote- and pallet Warehouses and inner plant logistics.

So, if you are attending @IFFA_Frankfurt next week, make sure that you swing and let us talk about your computer technology can improve YOUR business processes, making you more competitive in your market place.


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About that nose diving Apple Stock…

Facebook friends of mine may confirm that I called Apple (APPL) stock falling pretty rapidly about 1 year ago, and the current dive it far from over. While I still like their products, it is the nature of the internet and the nature of competition that greatly endanger some of the core principles of the Apple business model, and that of some others operating in similar fashion.


At the heart of the issue are efficiency gains. Every single commercial success on the internet has been created by efficiency gains. Cutting out the middle man and delivering digital content drove music stores like Tower Records, book stores like borders as well as travel agencies out of business. The new businesses that replaced the old business model where extremely successful because they were the first on the scene. Being so successful called competitors to the market, wanting their slice of the action, and now we have a number of sites that do the travel arrangements for us, help us search and places where we can buy our books. I admit that there are some 800lb Gorillas out there dominating certain markets, but they need to be on the watch.

The current business model of Apple is already under attack. Ecosystems similar to Apple’s are already being operated by Google and Microsoft. Large players like Samsung will soon face the reality, where Google makes more money with their handsets than Samsung itself. There will be plenty of incentives for them to operate their own stores (which as a matter of fact they do already on their Smart TV’s).


In the meantime, consumers get fed up with buying software from proprietary stores which does not operate on all the devices they own. I may be the exception, but in our household are today already windows devices, linux devices, proprietary ‘Smart TV’ devices and of course Apple devices. All I want to do is grab whatever device I feel like and do pretty much the same applicable stuff with them independent of where I purchased it or what operating system it runs.

The answer to these challenges is already around the corner. The Mozilla foundation will launch in the next few month an open source OS for mobile devices which comes without a major store. Ubuntu will do the same. This leads to a higher degree of fragmentation of devices in our households and pockets. Locally installed apps that come from some sort of app store will need to compete with HTML5 based browser applications, which will provide the very same and rich user interface we got used to by Apple and the likes.

I don’t believe for a fraction of a second, that the 25-30% commission raked in by Apple, Google and Microsoft will be accepted by the large communication providers, equipment providers and software companies. So unless Apple will come with something else, which is truly disruptive, like an iCar, iTV or iKitchen and revolutionize another major areas of our lives, they will not be able to fend of the competition, which when all features and functions become comparable will boil down to price, something that Apple never has been able to compete with.

Watch it unfold!


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ERP is meeting the real world

I admit, I am a little geekier than most people that I am dealing with. I like technology and people that interact with me don’t always get what I am doing and even more why I am doing these things.

I started working with technology using a PC-XT 8086, running at 4.77 MHZ with 20 MB HD and 640 KB of RAM. 2 years later, I started working with the world’s leading software company (http://www.csb.com/ ) on business process improvements using computer software technology at the dawn of standard software programs specific for certain industries. Processing power on the available computers and memory was very limited, storage was expensive and networking was limited both in speed and connectivity – the internet was still in its infancy as AOL and Compuserve carpet bombed the world with their CD’s.

Managing computer systems in any company and any organization required tremendous compromises. It was impossible to capture the ‘real world’ data that was not even thought about. We thought carefully about every single byte of information, and whether we store this or not. We looked at our systems isolated, because there was no such thing as public information, public networks and public databases. Fast forward – we write Earth Date 04-13-2013.


Microsoft just launched about 48 hours ago the public preview of Geoflow (see Screenshots to the left). Most business people look at this critically and consider this playful, impractical, basically next to useless. Most people do not understand how disruptive this is.

90% of all data and information has been generated in the last 2 years.
You must imagine, that this means that we have generated 9 times as much information in these years than all data generated by mankind’s history! We are storing more and more information in our corporate systems, but more and more information is NOT in our home grown systems. ‘Geoflow’ is just an example of data systems that become available for us in conjunction with our business data. I can take the data from my Meat ERP solution and combine it with all the information that in this example the mapping engine of Microsoft Bing provides. I mean, sales reps can quite literally see red flags at a customer in a business data report, see what airport is nearby, hotel, restaurants – we do not need to switch to other systems anymore to experience full convergence of our business data with the real world.

It is just interesting for me, what power we have when we combine public data with our business. We can get feeds about commodity prices from USDA and the Chicago Board of trade, news feeds from TheNational Provisioner and Global Meat News and online Recall Notifications from FDA and FSIS. Multi-Billion dollar organizations are traded on NASDAQ and NYSE, whose sole existence is based on collecting and reselling data: Facebook, Google, Reddit, Pinterest, Yahoo and Groupon just to name a few.

But let’s not get to confused here: the biggest advantage of all of them is time! The most eye-popping moment last week was for me when I engaged into that nasty habit of dangling with my tablet in while watching the “news” on TV. The one hour I watched (30 minutes each for local and domestic news), I saw two segments about the meat industry, one was about the new naming conventions for meat cuts and the other was about the new findings on harmful components in red meat. I read about both of these news at least 48 hours earlier on my web RSS feeds and will read about them in the leading trade publications probably in a month from now. It makes you feel like the TV is a rear view mirror and news magazines are history books.


We must connect our business data ‘live’ to the origin of information to make significant strategic impact on the organizations we are managing. The speed in which we can obtain, combine and analyze that information can make a tremendous impact on the profitability of our organization. I will be in Europe at IFFA at the CSB-System booth, Hall 11.1, Booth B81 – feel free to come by and discuss some ideas how data can help to manage your organization more profitable.



 

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Business Intelligence for meat packers and meat processors

I wrote about the new type of people we need in IT or perhaps better working with IT or with technology in last week’s blog post. I did not really write much about what these people should do and how they can make a difference. I found that the biggest mental problem for companies in the meat industry is the approach they are taking with BI Tools. Business intelligence is for most people that I meet on a regular bases a way of making existing reports prettier and perhaps faster. Prettier a lot of times does not even equal improvements in productivity, since the way that data is being visualized does not make them better understood. People should use tables where tables make the most sense, and should use other prudent visualizations to illustrate data graphically. A pie chart is e.g. in most scenarios not the right visualization tool, even if you want to depict the share of a whole. Studies have proven that people would recognize shares better in e.g. stacked bar charts much quicker.


The most important thing though is to learn how to ask different and more detailed questions. There is hardly any ROI in a BI project, if we are not asking and answering more complex questions. Today, we can process much bigger data volumes in much faster times. This actually leads to approaches that not only evaluate data properly, but lead to actionable reports. By analyzing your financials, your collected inventory and your production data based on the most granular level available, you can analyze any aspect of your business in ways you don’t even attempt with your existing reporting tools. A few examples:

  • Everybody in meat packing analyzes cooler shrinkage. You may find, that your carcasses lose between 1% and 3% before they hit the cut floor. This does not really mean that you can act on these reports. With modern tools you can store the exact time spend in the cooler, store the exact cooling positions and understand what happens in your cooler very detailed, so that simple changes in the way you move animals in and out of your cooler can improve your cooler shrink by 5% or more. Visualizing the cooler as a heat map will create a good understanding on what is happening at which location.
  • Ditto with smokehouses. If you know exactly what rack had what position, you can determine exactly what smokehouse and what position is not circulating or yielding according to your standards.
  • Understanding the exact lifecycle of each box you get, whether it is raw materials or finished goods help you understand shrinkage, but also bound capital in new ways. You may know already that you have to stage product to export, but what is the average costs of financing building each load? Perhaps this line of business is not quite as profitable as you may think it is.
  • The daily P&L is no longer a pipe dream. It is actually quite easy to build a report model combining perpetual inventory, purchasing and sales from your financials on a daily bases, and plug in the missing pieces like labor, fixed costs and other cost components via report models and formulas. You would be surprised how close you get with the results.

The learning curve is pretty steep, and the easiest way of going about it is actually forgetting what you are doing today. Don’t start working with your existing reports, start off with new ones. Don’t automate the manual spreadsheets that you are creating every day, question their very existence. Ask yourself what you actually want to know about your business. Ask yourself what questions you tried to answer before you got these reports in the first place. Start with a fresh mind, and the value Business Intelligence solutions will deliver to you will have a tremendous impact on your business.


If you want to learn more about this, feel free to reach out to me. I will be at IFFA in Frankfurt and will answer all the questions you may have.


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