Ellery's Essays

Solving Urgent Problems in Supply Chains

A shipping manager of a medium-sized consumer goods company is dispatching deliveries one morning. One of the company’s trucks unfortunately won’t start. The driver says the battery is dead. The truck is loaded with products a customer ordered and is waiting to receive. The truck is twenty (20) years old, and the manager already secured top management approval to have it replaced with a new one in a few weeks. Should the manager buy a new battery, or should he transfer the products to another truck for delivery later in the day? Should he retire the old truck and wait for the new truck?

Urgent problems are issues which vie for immediate attention and resolution. A problem is especially urgent when a person of authority, i.e., owner, executive, or manager, perceives it as a cause for setbacks or threats to one’s operations or schedules.

The example of the truck with the dead battery is urgent as it threatens the schedule of the shipping manager’s operations. But what is the problem exactly? Is it the truck requiring immediate repairs or is it finding another way to deliver an order to a customer?

One should be careful before answering the above questions. On one hand, the problem is how the shipping manager could get the truck fixed and running. On the other hand, the problem is how to deliver the order to the company’s customer who expects it today. As the answer may seem obvious to some (delivering the order), other managers may perceive it otherwise (needing the truck to be fixed to avoid backlog in deliveries).

Urgency of a problem stems from the attention it seeks. Urgency, however, is not the same as importance. Importance depends on how a problem would affect performance towards meeting goals. A problem can be urgent but not necessarily important. And there are problems that are important but not necessarily urgent.

Then there is the degree of urgency. An urgent problem may be nothing more than a pressing matter, that is, one which could be resolved quickly, or it may be a full-blown crisis, one which causes or threatens catastrophe.

There are urgent problems, however, that could go far beyond the managers’ capabilities to solve. Such urgent problems would prompt managers to seek help. In the case of the broken-down truck at the shipping dock, if the shipping manager can’t get the truck fixed or couldn’t find another truck to deliver the customer’s order, the manager would be facing an urgent problem, escalating into a crisis. The urgent problem may no longer be about fixing the truck or finding another one; it may be about the lack of capacity to deliver pending orders. And if the urgent problem threatens the company’s topline sales target, then the manager may have gotten a crisis on his hands, in which he’d need help.

Managers turn to engineers to fix urgent problems in their systems & structures. Engineers, after all, are problem solvers by education and training. Hence, engineers are often observed overseeing complex repairs of equipment and recommending changes to designs of facilities or systems.

Managers, however, don’t usually turn to engineers when it comes to urgent problems in supply chains.

Several enterprises I had worked with were chronically in crisis stemming from similar scenarios as the example of the broken-down truck at the shipping dock. In many such cases, operations managers tried to solve the problems on their own. Most ‘successful’ solutions were nothing more than short-term remedies, in which the problems would re-emerge in the not too distant future. Others were downright failures, which led to outsourcing of the problematic operations or change of management, which brought higher expenses or losses to companies.

The common denominator in many chronic supply chain crises is that management does not turn to engineering expertise to solve their urgent problems.

Urgent problems, like all problems, could be best solved via a problem-solving methodology most engineers are adept at:

Define problem
Brainstorm solutions
Outline criteria for solution selection
Select solution
Develop roadmap or plan for selected solution
Develop detailed designs & plans for selected solution
Implement solution

Whereas managers could do the methodology too, engineers are better equipped with in-depth technical expertise they learn from school and experience.

Some managers may argue that their experiences are just as in-depth as engineers. The jobs of managers, however, are about managing resources to perform toward objectives. Engineers’ jobs are about solving problems. Managers may have some expertise, but they would not have the same focus as engineers. Each respective profession has different sides of experience due to the variance between their foci.

Managers may also say that there are too few, if any at all, engineers with problem-solving expertise in supply chains. The rejoinder to this is many managers are reluctant to admit the need for supply chain engineering which discourages interest to the field. And there is an engineering field that does address supply chain problems: it’s called Industrial Engineering.

Urgent problems are not-so-welcome staples in supply chains. They occur in varying degrees from pressing matters to full-blown crises. Because executives have yet to recognise the need for supply chain engineering to help address urgent problems, enterprises suffer chronic setbacks and face ongoing threats from the supply chains they operate in.

Supply chain engineers, like other engineers, apply a methodology to solve problems. Their in-depth education and experience which is unlike what managers are trained in give them the expertise to address urgent problems.

Find Ellery

Separating Facts from Inferences

When it comes to solving urgent problems, I use whatever information is already available. I don’t spend any more of my valuable time to gather or validate any more data. Time is of the essence. I’d like to remedy any adverse situation as fast as possible.

In some cases, the remedy does the job. But in not a few instances, they don’t. The problems re-emerge and some return more seriously than before.

My company’s sixteen (16) year old Toyota Fortuner SUV stalled one day on the road. The driver said it was likely the alternator had failed. The road-assistance technician who brought a new battery agreed after he tested the newly installed battery. The driver and technician suggested I ask a mechanic to repair the alternator.

I decided to stick with the new battery. The Toyota SUV broke down again the next evening again on the road. Fortunately, a roadside assistance team lent me a service battery to enable the driver to bring the SUV back home. The next day, I called the mechanic and he said not only was the alternator in need of repair but also the radiator’s water pump was nearing breakdown. I had the mechanic repair all of these and by next day, there were no more problems with the Toyota Fortuner.

Because I doubted the fact that the Toyota Fortuner’s alternator was not charging the battery, I lost more time and a little more money in repairs. It could have been worse. Were it not for the roadside assistance team’s willingness to lend a battery, the Toyota Fortuner would likely have been towed at greater expense.

A fact is information based on a real occurrence.

We tend to mix up fact with truth. Facts are based on observations. Truth is based on inferences, conclusions we make from facts.

For example:

Fact: the thermometer reads 32^º Centigrade.

Inference: It’s hot.

Fact: Your dashboard camera shows a vehicle bumping your car’s rear end.

Inference: Somebody just hit my car and it’s the other vehicle’s fault.

Fact: The new battery of my Toyota Fortuner shows no increase in electric charging from the alternator

Inference: The alternator isn’t working.

Inferences are what you see a lot in social media. People who post their inferences would declare them as truths. Commentators would agree or disagree, which would then lead to debates.

Some people end up doubting the inferences and questioning the facts. The trouble is, however, that often, we don’t read too many facts in social media posts. What we see instead are posts claiming to show facts when they are nothing more than inferences.

There are calls to regulate social media because some groups of people believe there is a proliferation of disinformation.

But what do they mean by disinformation? Is it the lack of or the twisting (falsifying) of facts? Is it about inferences not seemingly based on facts? Or is it that the opinions of some people incite vehement disagreement thereby leading to conflict?

The Internet connects people to abundant sources of information. Individuals can access data and harvest facts from the worldwide web. Individuals, however, draw conclusions from whatever data or facts they deem as enough to do so. People choose facts which would support their cases. Critics bring up facts which would contradict those cases. In many instances, individuals don’t bring out all the facts to infer what may really be closer to the truth.

An environmental activist may cite warming temperatures as bases for global warming. But a resident shivering from winter cold may doubt the activist’s claims. How could there be global warming when it’s cold where I am?

Both the activist and the resident should ideally lay out all the facts, distil them via analyses, before inferring whether there is global warming or not.

The trouble is many of us don’t do that. We choose what we want to see or hear and doubt whatever doesn’t agree with our beliefs.

And I am just as guilty for doubting facts and jumping to my own conclusions based on my beliefs or just plain stubbornness. And I paid for it with a near-miss disaster with my company’s Toyota Fortuner.

Find Ellery

Never Make the Boss Wait

A field sales manager was late in fetching his boss, the multinational corporation’s director of sales. Rumour had it that as a result of that snafu, the field sales manager was passed over from promotion and was eventually re-assigned to an obscure position at the logistics department. Some years later, the field sales manager resigned as his peers moved up the corporate ladder without him.

Field sales managers in the corporation tell new salespeople that they should never ever make the sales director wait. Whether it be picking up the executive at the airport or attending a meeting at the head office, sales managers have an unwritten rule in which they should never be late. Because if they ever were late, chances are those erring salespersons would be bypassed from promotion, their careers frozen for good.

There was no such rule in any of the corporation’s manuals about not being late to a meeting or an appointment with one’s superior. There is also no memo or letter stating such a measure. The ‘never should you make your boss wait’ is an unwritten rule, one shared only between salespeople and other employees in the sales department.

Yet, salespeople in the multinational corporation follow this rule and communicate it to others. They feared risking their careers if they did not comply.

It’s not enough for employees to just follow whatever the written rules are. They should also know and be familiar with the unwritten ones as well.

Find Ellery

It’s a…What Is It, anyway?

Subic Bay at Luzon island, the Philippines, is a former United States naval base. In its heyday from the 1950s to the 1970s, it was the Americans’ largest military facility in the Western Pacific.

Subic Bay served as a logistics hub and port for the US Navy. Together with the nearby Clark Air Base, Subic served as the Americans’ projection of military power in Southeast Asia.

In 1991, after the Mt. Pinatubo eruption, the Philippines and the United States did not renew the lease treaties of both Clark and Subic. In a matter of months, the Americans left and turned over ownership of the bases to the Philippine government.

The Philippines immediately declared Clark and Subic as ‘freeport zones,’ in which authorities granted tax incentives to firms doing business in the former bases. Factories and duty-free stores sprouted at Subic and Clark as a result.

Subic Bay, more than thirty (30) years later, had become a….what? One cannot figure out what Subic had become. The former naval base has a deepwater port which loads & unloads merchandise for export & import. It has companies, big & small, with manufacturing & logistics operations. It has shops selling duty-free products. It also has recreational places, such as a golf course, safari, an aquarium, scuba dive spots, a horseback-riding ranch, a rainforest, and a beach. There are also several hotels, residential condominiums, a yacht club, as well as private enclaves.

Subic had become a mix of so many things, such that one couldn’t figure out what it was. Was it an industrial free-trade zone? A duty-free shoppers’ paradise? An eco-tourism site? A very large resort?

And because it tried to be so many things, Subic had no one identity. It was like a person who had multiple personalities—no one knew which was real.

Subic didn’t draw crowds and instead had become a sparsely populated place. Business was mediocre at best. Locators who manufactured and did logistics there did not really expand. New investments year to year weren’t too much, nothing to boast much about.

Nearby Clark was a bit luckier. Thanks to its growing airport, people identified Clark as a viable alternative versus Manila for travel to and from Luzon island. Subic, however, remained almost anonymous as people were clueless about what the former naval base was or could be.

The lesson from Subic was that when one markets a place, one should develop an identity for it. One shouldn’t promote it as several things. Subic is a free industrial zone; it’s a duty-free shoppers’ locale; it’s an eco-tourism site; it’s a recreational area; it’s a private get-away-from-it-all residential place. When one says it’s all these, one gets the impression it’s trying hard and it becomes none of the above.

What is Subic? Time won’t tell. Only people who have stakes in it, if there are any, will.

Find Ellery

What is the Problem in the First Place?

I went to a branch of a local drugstore to buy a small bottle of mosquito repellent lotion. The branch didn’t have any stock but the nice lady behind the counter checked her computer and told me to go to another branch which was a short five (5) minute walk away. I went to the other branch and yes, there were small bottles of mosquito repellent lotions available. I picked up a bottle and then shopped for another item: shaving cream. There was no stock but the nice lady behind the counter of this drugstore branch said there were some available in the branch where I came from.

What’s the lesson I learned here? Buy all the available items you’re looking for before going to another store. Haha.

Why is it that some stores would have plenty of one product and none in another? It’s easy to pin blame on the manufacturer who sold the product. Maybe the sales representative was remiss in checking stock availability or the manufacturer’s logistics department hadn’t been delivering pending orders?

The large corporation that owns the drugstore has a central warehouse that receives products and distributes them to all its branches. Could it be that the drugstore corporation wasn’t efficient enough to stock all its branches with the complete line-up of products?

There’s also the possibility that a customer bought plenty of one (1) product at one drugstore branch and left none for the rest of the day. It’s what managers would call a spike in demand.

Some supply chain managers would recommend building up inventories at branches to avoid stock-outs. Inventories, however, come with a cost, in the form of cash tied up on unsold products on a drugstore’s shelves. Executives don’t like cash being tied up especially if it can be used elsewhere such as high-interest returning investments.

Information technology (IT) managers could suggest installing an integrated information system which would flag out-of-stock incidences to the drugstore’s logistics planners in real-time. Supply chain managers could swiftly deliver items using smaller trucks or even motorcycle couriers. Transportation expenses might rise though.

All these possibilities sound well and good, and many companies do apply the ideas above. But what was the problem in the first place?

If perhaps it were the owners of the mosquito repellent lotion company who noticed the lotion being out of stock at the drugstore branch, they maybe would throw a fit as they call the sales and the supply chain departments to investigate and restock the branch.

Executives & managers tend to fast-track solutions to issues without first defining what the problems are. But is there really a problem? Does the drugstore chronically run out of stock in its branches or was that stock-out of mosquito repellent solution a one-time event which doesn’t happen often? What products are always out-of-stock? How much is the drugstore losing from stock-outs?

And there perhaps lies the bigger question: how are stakeholders addressing their supply chain issues? When does an issue become a problem, and when does a problem become a crisis needing a lot of attention?

These are questions which could keep supply chain managers, if not executives, awake at night. Answers won’t come, however, by grabbing for solutions. They come after clarifying the problem.

When stakeholders know what the problem is, when it becomes clear what the root causes are, solving problems becomes more straightforward.

Find Ellery

Praising Unsung Heroes

National Aeronautics & Space Administration (NASA) administrator Jared Isaacman praised the United States space agency’s workforce for the success of the Artemis II mission which brought four (4) astronauts to orbit around the moon and back for the first time since the Apollo missions in the 1970s.

Mr. Isaacman’s praises were noteworthy given all the media attention and accolades to the four (4) astronauts, who many called heroes.

How many times have I and a few operations professionals attended annual sales conventions of corporations and saw chief executive officers (CEOs) heap praises and give rewards to sales & marketing people for successful business results of brands & products. Apart from all the credits, the salespeople also receive hefty commissions for meeting monthly revenue quotas.

Meanwhile, other departments like operations, accounting, R&D, and human resources receive little or no recognition and get nothing extra. It’s already significant that I and those few operations professionals even get invited to those conventions (some years I’m not even asked).

Before and after every such convention, executives would scold operations for any failure to deliver pending sales orders. There also would be hardly any acknowledgment to accountants who submit reports before deadlines. I’ve seen executives even fire company agents who were unable to collect from customers who intentionally delayed payments.

Despite whatever large savings in expenses other departments were able to attain, executives would just say that it was part of their jobs to reduce costs. The same executives would add that the people who did any hard work for lower costs probably made up for it via overtime.

Meanwhile, the executives praise the sales & marketing people when revenue targets are met, and they provide the support structure of bonuses & commissions. In fairness, executives do pounce on sales & marketing people to build business and reap higher revenues. Unfortunately, they do the same for every other department but without a similar support structure.

Is it any wonder then that employee turnovers in such corporate organisations are high? The turnover might not be apparent or even is concealed when executives opt to outsource operations, accounting, and human resources administration to third parties. The morales of people whether in-house or outsourced suffer, nonetheless.

I congratulate NASA’s Isaacman for not forgetting the contributions of hundreds of the space agency’s staff for the success of the Artemis II mission. Hopefully, executives would not only emulate Isaacman in their own organisations but also go a little further by setting up structures & systems of support for the departments that aren’t as visible as astronauts who go to the moon.

Find Ellery

How Do Supply Chains Fit into Your Firm’s Priorities? (Wrong Question)

Supply chains are the lifelines of the products & services of enterprises. Hence, executives should manage their enterprises’ supply chains to ensure they will meet strategic goals.

Nice answer. Wrong question.

Supply chains don’t fit into the priorities of enterprises. It’s the other way around. Enterprises must fit into the supply chains they are linked to, to enable the enterprises to meet their strategic goals.

Supply chains are made up of relationships forged via pacts between enterprises. Enterprises are not the centres of the supply chain worlds. Executives negotiate contracts and transact with other enterprises to buy merchandise, engage services, and sell to customers. The supply chain is not subservient to any one enterprise.

Many executives, however, don’t share this line of thinking. They would prefer to assert dominion over their vendors & customers than to collaborate and form pacts.

Walmart, the very large North American retailer, for example, insists vendors comply strictly to the corporation’s quality & delivery protocols. Vendors who don’t comply or violate Walmart’s rules are either penalised or threatened with termination.

Walmart also had set up a network of distribution centres to complement its huge warehouse stores in North America. Walmart, thus, asserts its influence over the consumer goods supply chain from vendors to customers.

Walmart, however, does not rule over all vendors and customers. Some vendors won’t sell to Walmart, and not all consumers shop at its stores. There are products not sold at Walmart’s shelves. Walmart also competes with other large retailers like Sam’s Club, Costco, and Target who have respective large customer bases. As much as it may try to, Walmart does not hold 100% sway over the consumer goods supply chain.

Walmart does negotiate and forge contracts or pacts with vendors, especially large ones like P&G. Collaboration in many cases is the norm. And it is by working and being flexible with suppliers that Walmart remains successful. Domination may work some of the time but collaboration for win-win partnerships is the ideal.

Still, executives attempt to have supply chains adapt to their companies’ cultures rather than their companies adapt to the realistic intricacies of supply chains. It works to some extent, but it won’t work to the full. Somewhere down the line, enterprises end up collaborating and making deals.

No one enterprise dominates an entire supply chain. Some would try. Some would partially succeed. But they eventually don’t.

Enterprise executives shouldn’t ask how supply chains can work for them. They should ask how they could work better with supply chains.

Find Ellery

What Is Your Masterpiece?

Twenty-eight (28) out of Vermeer’s known thirty-four (34) masterpieces were exhibited at Amsterdam’s Rijksmuseum in 2023. My sisters & I immediately bought tickets as soon as they went for sale.

In March 2023, we travelled to Amsterdam and the Rijksmuseum to see Vermeer’s paintings. Relatives and friends were amazed that we would go all the way to Europe from our home country, the Philippines, to see the works of a European painter. Some of our relatives & friends didn’t even know who he was.

As we stepped into the gallery to see the first painting displayed, The Little Street, we knew right there and then it was worth the travel to see the Vermeer’s paintings in person. No matter how best photographs from the Internet or from any professional cameraman could claim to be, nothing could match the quality of a painting seen with one own’s eyes.

The Little Street
photographed at Vermeer Exhibition, Rijksmuseum,
March 2023

The rest of Vermeer’s paintings elicited the same reaction. Many found the exhibition magnificent.

Johannes Vermeer wasn’t wealthy when he passed away in 1675. It was only in the middle of the 19^th century that a French art critic, Théophile Thoré-Bürger, re-discovered his artworks and re-introduced him to the art world. Vermeer became even more famous when his painting, The Girl with the Pearl Earring, became the subject of novels and movies at the turn of the 21st century. Millions of people had gone to see and admire the masterpiece since 1999.

Girl with the Pearl Earring
Photographed at the Mauritshuis, The Hague, July 2018

But did Vermeer consider his paintings as masterpieces? Was it his ambition to paint for accomplishments to be appreciated?

Many artists before and after Vermeer’s time painted for a living. Johannes Vermeer was no exception. Despite his fame, there is not much known about him but many who have researched about him believe Vermeer struggled to earn a living for himself and his family.

Artists from Michelangelo, Da Vinci, and Vermeer painted and contributed their art not out for the sake of fame but for enterprise. Rich families and a then powerful and wealthy Catholic Church commissioned artists to sculpt and paint for their mansions and cathedrals. The artists valued the recognition but more so to obtain more work and commissions. Artists, like any normal people then and now, had to work hard for a living.

At first, I saw the great works of European artists as inspirations to make masterpieces of my own. I asked myself, “what would be my masterpiece?” What would be a crowning achievement in my life, one that would stoke admiration even long after I am gone from this world?

Many self-help gurus tell us to define goals and work to achieve great things. But as I delved into the lives of great artists and other famous persons from history, I learned that most, if not all, did not set lofty aims to deliver immortal masterpieces.

Many artists painted or sculpted because they liked, if not loved, to do so. Vincent Van Gogh, for example, painted because it brought him solace from his personal and health issues.

Great artists became so because they loved what they do and the work gave them comfort, on top of commercial benefits. Masterpieces are the results of jobs well done. They are not the ends but the means in pursuing whatever one’s personal goals are.

Johannes Vermeer likely painted more to bring bread to his family than to make a name for himself via his masterpieces. The masterpiece he probably wanted was one where he and his family would be economically secure. He wasn’t totally successful even though his works brought him fame centuries later.

What is your masterpiece?

Find Ellery

Her Problem Was Worse Than Mine

The Bureau of Internal Revenue (BIR) employee told me to come back with several documents before the agency would give my business firm access to the forms on its electronic payment portal.

I already submitted the application for the new forms via the BIR’s registration portal, I said. And it was already approved, I told the BIR employee.

The BIR employee said the issue wasn’t the access but that there was another form I needed to apply for.

But why do I need to apply for another form when I’m using the same one to submit and pay for the same tax, I replied to the employee. The employee just said I needed to do it.

I gave up arguing.

After two weeks of preparing the paperwork, I submitted the documents he asked for. The BIR received the documents and told me to come back after five (5) days to get the new certification of registration (COR) updating my company for the new forms. Five (5) days later, when I went to the agency’s office, there was no one there. Come back next week, the security guard at the office gruffly said.

The good news was that the BIR updated my company’s access to the agency’s payment portal so my business could already submit the new forms I was applying for. I only needed to get the new COR which formally would certify that my business was obligated to submit the new forms. A COR is vital whenever the BIR would audit my business.

The BIR has online portals to make it easier for taxpayers like me to register and pay taxes. It benefits the government more than it benefits me and my business. Yet, the agency makes it hard for me and many taxpayers to use the portals as it requires so much paperwork and legwork.

I thought about broadcasting my experience on social media but when I saw a businesswoman posting about a nightmare she had in filing and paying her capital gains tax for a property she sold, I decided to just count my blessings.

The businesswoman was lucky in that her social media post went viral and caught the attention of the BIR commissioner. She met with the BIR leadership who promised to take steps to improve the agency’s systems.

Some people encounter bad experiences with the governments they fall under. Sometimes they via their complaints catch the attention of leaders. Unfortunately, there are many others with stories like mine who don’t.

Being a Philippine citizen doesn’t give me privileges. It just gives me more work to do.

Find Ellery

Arguing for Adversity vis-à-vis Risk

The built-in artificial intelligence (AI) program on the word processing software advised me to replace the term, adversity, with risk. Risk, the AI app said, is a more familiar term than adversity.

I didn’t agree and I kept writing ‘adversity’ into my essay.

Risk is the likelihood an unfavourable event shall occur. Adversity is an unfavourable event or entity which represents a barrier, obstacle, or setback to any progress towards one’s goals.

In short, risk is not a synonym of adversity. They are not one and the same in meaning.

The AI program is right in that risk is used more widely than adversity, especially in the context of business and operations, which I do a lot of writing about.

But I write to share insights.

Organisations manage risks but they had not been very successful in anticipating adversities. Managers identify risks from what they know and assess. Adversities, however, stem from uncertainties, if not from the unknown.

People may not be as familiar with adversity than with risk, but it is the former which disrupts one’s operations.

One could calculate risks but not anticipate adversities.

Find Ellery