Summer session explores opportunities, risks of digital disruption

Nearly three-quarters of a century into its existence, Safelite Group has reason to act like a market leader – it is one.

The ubiquitous Columbus-based glass repair and replacement services company has a presence in all 50 states, with the capability to serve about 97 percent of U.S. drivers. Even 70 years after its founding, it’s in growth and acquisition mode.

That doesn’t mean, however, that Safelite isn’t keeping an eye out for disruptors waiting in the wings to turn the business on its ear.

“We’re looking over our shoulder,” said Bruce Millard, the company’s vice president of digital and customer innovation. “We’re asking, ‘Who has the velocity to potentially cause us problems?’”

Millard was one of four speakers at the second of two summer sessions focused on top business challenges and co-hosted by the Center for Operational Excellence along with three other centers housed at Fisher College of Business: The Center for Innovation and Entrepreneurship, the National Center for the Middle Market and The Risk Institute. After surveying the state of the “talent war” in July, the centers brought together industry executives and academic experts to offer a mix of exciting developments, sobering realities and paths forward in the rapidly shifting world of data analytics and digital disruption.

Cisco’s Jeremy Aston

In his kickoff keynote, Jeremy Aston of tech communication giant Cisco shared how much — and how little — has changed in how companies are viewing and preparing for the threat of digital disruption. Cisco’s Global Center for Digital Business Transformation in a 2015 survey of nearly 1,000 executives found 15 percent said digital disruption was already occurring in their respective industries. At the same time, a scant one in 250 of those surveyed said digital trends would have a transformative impact on their industry. Fast-forward to a new survey round this year and the shift is staggering: Half of those surveyed said disruption was ongoing, while nearly one in three foresaw a transformative effect.

“Today, we’re under pressure to transform and perform,” said Aston, senior director of the Go to Market and Offer Monetization Office at Cisco.

One statistic that changed little in the two-year span hints at a gap Cisco’s research has found between companies’ awareness and action. In 2015, a quarter of those surveyed said they were “actively responding” to digital disruption. That number rose to just 31 percent this year.

“That is a dangerous game to play,” Aston said.

Drive Capital’s Mark Kvamme

While the media/entertainment trades and Cisco’s own technology products and services niche are easily most vulnerable to disruption, few – if any – parts of the economy are immune to companies born in today’s digital-first world. Speaker Mark Kvamme, a former Ohio economic development official and partner at venture capital investment firm Drive Capital, shared a dynamic portrait of “born digital” companies in Drive’s investment portfolio. One of them, Columbus-based startup CrossChx, has launched an artificial intelligence-enabled tool for the health-care industry that synthesizes and automates high-volume, repetitive tasks — prior authorizations, appointment reminders — outside the scope of patient care. On the analytics front, Columbus-based FactGem — run by Megan Kvamme — is helping companies translate hordes of data from far-flung sources into actionable intelligence.

All these innovations, Kvamme said, point to an unavoidable truth: “The amount of change we’re going to see in the next five to 10 years is going to spin everybody’s heads.”

A world of opportunity, however, also means a world of risk. Professor Dennis Hirsch, who runs the Program on Data and Governance at Ohio State’s Moritz College of Law, closed out the session with a look at the tricky terrain of data analytics in technology, which already has destroyed some players (student data repository InBloom) and led to serious brand damage for others (Uber).

“Big data is a crystal ball,” Hirsch said, “and that means it can be used for good — and for bad.”

As companies move forward, Hirsch said, it’ll be incumbent upon them to establish processes and guiding values that protect customers and treat them fairly. Technology and its innovative uses for data, in fact, are outrunning the law itself.

“The law hasn’t caught up, and to some extent it never will,” Hirsch said. “We need to be asking, ‘What does it mean to be responsible beyond just compliance?’”

A key tool companies can use as they make decisions on these issues, and the broader world of digital transformation, is a decidedly non-technological notion at heart: process. From a legal and ethical perspective, that means establishing them on the front end to mitigate the risks of leveraging big data. From a business agility standpoint, Aston of Cisco said in opening the day, that means having a perspective that extends beyond the flashy innovation itself.

“We have to make thoughtful decisions,” Aston said, “and we can’t just be focused on technological outcomes. What’s the business outcome you need to drive?”

DHL Supply Chain riding digital wave with ‘smart glasses’ pilot

The digital wave continues to wash over the global economy, and it’s making a big splash at a Center for Operational Excellence member company.

dhl supply chainMember DHL Supply Chain this month announced that it has completed a pilot of a new augmented reality addition to its warehouse picking operations, equipping employees with “smart glasses.” By wearing these glasses, employees have instant access to visual displays that give picking instructions, along with details on where the item is located and where it should be placed on carts.

DHL Supply Chain in a press release said it’s seen boosts of productivity of up to 15 percent during pilot tests in the U.S. and in Europe, CIO and COO Markus Voss calling the digitalization “not just a vision or a program” but “a reality for us and our customers.”

DHL Supply Chain is one of many companies grappling and experimenting with the role of digital technology in legacy business models that, in some industries, haven’t seen radical disruption in generations. The challenge of digitization was the subject of an event just this week at The Ohio State Univeristy, where COE partnered with three other Fisher centers to address challenges and opportunities in this area.

In the opening keynote, Cisco executive Jeremy Aston shared research from the company’s Global Center for Digital Business Transformation showing that in just two years, companies’ perspectives on digitization have shifted drastically. In 2015, only 15 percent of surveyed companies told Cisco and its partners that digital disruption was already occurring in their industry. That number jumped to 49 percent this year. At the same time, roughly one in three of the executives surveyed told Cisco that digitization would have a transformative impact on their industry. Just two years ago, that perspective was shared by one in 250 surveyed executives.

DHL Supply Chain hinted that the “smart glasses” picking pilot is just the start, with plans to look at leveraging this technology in training and maintenance functions, among others.

COE ringing in 25th anniversary at September seminar

The Center for Operational Excellence is ringing in a momentous anniversary with a celebration in September featuring two standout keynotes.

COE’s fall kickoff seminar – a formal celebration of its 25th anniversary – is set for Friday, Sept. 15, where Robert Martichenko, CEO of LeanCor Supply Chain Group, and Billy Taylor, head of North America Manufacturing for Goodyear Tire & Rubber Co., are set to present. The sessions will bookend a tailgate-themed networking lunch … with some to-be-announced special guests.

LeanCor CEO Robert Martichenko

Both keynote speakers are renowned storytellers who bring a blend of personal and professional experiences to their respective stories of spending decades driving transformational change. Martichenko, set to keynote at 10:30 a.m. on Sept. 15, founded LeanCor with a mission to advance the world’s supply chains through training, consulting and third-party logistics. He’s emerged as a globally recognized thought leader in lean thinking and end-to-end supply chain management, as well as an award-winning non-fiction and fiction author.

Martichenko’s keynote, “Lessons in Lean: Lessons in Leadership,” focuses on what he’s learned while building organizational cultures focused on lean thinking and relentless business improvement.

Billy Taylor, Goodyear

Taylor of Goodyear, set to speak after lunch at 1 p.m., is a sought-after speaker and self-described “evangelist” for people-inclusion processes in operational excellence. In his keynote, “People-Driven Operational Excellence,” he charts his journey from fledgling plant manager to top leader at an iconic brand, offering insights on keys to building a high-performance, self-sustaining culture that’s the foundation for company-wide success.

Both sessions also will be offered to employees of COE member companies via live webcast, hosted and run by Mills James. Registration for webcast and in-person attendance – expected to reach capacity – will open the week of Aug. 7. Read more about both speakers on our website.

The event comes a full quarter-century after the founding of COE, which started in 1992 at the Center for Excellence in Manufacturing Management. Once narrowly focused on the application of lean in the manufacturing sector – and touting only four members – the center has grown along with the field of operational excellence to encompass the notion that process improvement principles are intrinsic to competitive edge for any industry.

Today, COE has a roster of nearly 40 member companies and engages with thousands of operations leaders across the country in the shared pursuit of building better processes in a culture of continuous learning.

Fisher centers’ collaborative series shines spotlight on ‘talent war’

Fisher College of Business’ research and business partnership centers might be individually focused on an eclectic range of themes, but finding common ground is easy when it comes to today’s toughest business challenges.

A group of four Fisher centers teamed up this summer to tackle two of the biggest challenges companies face today: growing and developing talent, and unlocking the power of data and digital disruption. Nearly 150 members and guests of the Center for Innovation and Entrepreneurship, Center for Operational Excellence, National Center for the Middle Market and The Risk Institute gathered in July for a deep dive into winning the “talent war,” with the disruption-focused follow-up set for Wednesday, August 16.

The big picture

Keynote speaker Marek Gootman of the Brookings Institution

The July “Winning the Talent War” session turned a spotlight on some of the key issues employers are facing as they match the supply in the talent pool with their hiring needs. A region’s talent pool, keynote and Brookings Institution Fellow Marek Gootman told the crowd, is nothing short of the key to its vitality.

“One of the things that connects everyone is where we’re pooling our talent from,” he said, “and talent is a key driver of economic competitiveness.”

Harnessing the potential of the labor pool today, however, means facing serious headwinds, Gootman said. For one, employers are demanding more workers with a college education despite the fact that many out-of-work members of the labor pool don’t have more than a high school education. A recent Brookings analysis of 130 population centers by county – among them Columbus’ Franklin County – found that 55 percent of those out of work have, at most, a high school degree, while only 20 percent have a bachelor’s degree. In Franklin County, that gap is even wider.

Brookings, a research partner with Fisher’s middle market center, is an advocate for workforce programs – apprenticeships and social enterprise initiatives, to name a few – that can help solve this supply-demand imbalance. And with technology’s reach extending these days to traditionally “non-digital” jobs, building workforce skill in this area is quickly taking on critical importance, Gootman said.

“This is something that everyone, large and small, is going to be grappling with,” he said.

While these challenges might prove formidable to larger companies, they can be downright crippling to the middle market sector, whose companies create 60 percent of the country’s new jobs but can lack the capacity or perspective to reach outside their four walls for workforce help. New survey data Brookings compiled with the Fisher middle-market center and released at the session showed the sector’s firms struggling to hire for needed skills, underinvesting in talent planning and facing intense competition from larger companies.

By moving from an adversarial relationship to one that’s focused on building a better region, middle-market firms and larger companies can join forces and better leverage support from the public sector, Gootman said.

“You’re reliant on these mid-sized firms for the economic vitality of the region,” he told the crowd. “Large firms can find their own value in working with the middle market.”

The ground war

talent war panel
The discussion panel, moderated by Fisher Prof. Marc Ankerman, featured HR leaders from Cardinal Health, Marathon Petroleum, Nationwide and Wendy’s.

Shifting demographics and an explosion of digital technology are very much on the minds of top talent leaders at some of Ohio’s biggest brands, who joined Fisher Prof. Marc Ankerman for a panel discussion following Gootman’s keynote. In a wide-ranging question-and-answer session, human resources leaders from Cardinal Health, Marathon Petroleum, Nationwide and Wendy’s Co. grappled with the challenges ahead.

At Nationwide, a top Columbus-area employer, process automation and the rise of driverless cars are two technology-centered trends likely to disrupt not only the company’s base of 10,000 call-center associates – but the insurance models at the heart of its business, said Kathy Smith, the insurer’s VP of talent development. The oldest business represented on the panel – 125-year-old Marathon Petroleum – is similarly bracing for technological upheaval, but also investing in readying its existing workforce for it.

“We’re really focusing on repurposing our workers’ skills and preparing them to learn automated technology,” said Tony Moore, head of talent acquisition.

Technology is even transforming the hiring processes at the heart of human resources, said Will Shepherd, Wendy’s director of enterprise learning and development.

“We’re having to meet applicants where they are from a technological standpoint, and recruiters are stepping that up,” he said.

No matter what technological leaps are around the corner, panelists told the crowd they still have an eye on the kinds of capabilities that won’t show up on a resume, Smith of Nationwide highlighting collaboration and “emotional intelligence” as critical.

“We need to continue to build skills in the hard stuff,” said Kelly Wilson, VP of talent management at Cardinal Health, “but the soft skills are so important.”

Coming up

The collaborative summer sessions continue with a look at data and digital disruption on Wednesday, Aug. 16, featuring speakers from Cisco, Safelite Group, Columbus-based data analytics startup FactGem and the Ohio State University Moritz College of Law’s Program on Data Governance.

Seats allotted for COE are currently full but employees of member companies may join the waitlist for the seats by e-mailing Jackie McClure at mcclure.92@osu.edu. More spaces are expected to be released to the center the week of July 31, and those will first be extended to waitlisted attendees.

Global sourcing projects offer chance to connect with Fisher students

One of the best ways to unlock the value of your company’s membership in the Center for Operational Excellence is engaging with students at Fisher College of Business.

Prof. John Gray

Once again, COE is offering member companies the opportunity to partner with groups of students on projects designed to give them real-world experience – and give you real value at no cost. COE Associate Director John Gray is seeking interested companies to host a group project for his second-year MBA and junior/senior undergraduate “Strategic Global Sourcing” classes for autumn semester 2017.

To indicate your company’s interest, just fill out a quick survey by Tuesday, Aug. 8. If your project is selected, you’ll work with Prof. Gray in August to create a more detailed project scope, which will be presented to students at the start of the academic year.

In these projects, students take what they’re learning in class – make-vs.-buy decisions, location decisions, supplier management, and more – and apply it to a real-world problem-solving need at your company. By opening up your doors, providing data and committing to roughly one call per week, your company receives up to three hours of work per week per MBA student along with a written deliverable, which can include analyses conducted through the project.

Check out the “Student Engagement” section of COE’s website for more specifics on recommended project scope and more.

Many COE member companies take advantage of project opportunities as a way to network with students and build relationships that ultimately could open doors to internships and/or job opportunities. Projects also offer the chance for concrete ROI – the “I” being solely your company’s time and commitment.

Looking to engage more with the global sourcing community? Join Prof. Gray’s LinkedIn group. If you have questions or would like more details, contact him at gray.402@osu.edu.

Fisher Prof. Craig wins ‘best paper’ honor for retail industry research

A professor in the academic department closely affiliated with the Center for Operational Excellence is part of a team that took home a top research award for a recent paper on the retail industry.

nate craig fisher
Prof. Nathan Craig

Fisher Assistant Prof. Nathan Craig traveled to Washington, D.C., last month to accept the Ralph Gomory Best Industry Studies Paper Award, given annually by the Industry Studies Association. Craig and co-authors Nicole DeHoratius (University of Chicago) and Ananth Raman (Harvard Business School) clinched the honor for their paper “The Impact of Supplier Inventory Service Level on Retailer Demand,” published last year in Manufacturing and Service Operations Management.

The journal where Craig’s work was published was one of seven in a pool of contenders for the prize, which was judged by top researchers at universities in North America and Europe.

The winning paper breaks new ground in the field of retail research, which largely has examined business-to-consumer relationships in the past. Craig and his co-authors moved upstream in the supply chain to focus exclusively on the relationship between supplier service levels and retailer demand. By conducting a field experiment at Hugo Boss, Craig and his team were able to quantify the impact of a supplier boosting its fill rate, or the percentage of a customer order satisfied by a shipment. Specifically, an increase of only 1% in supplier fill rate lead to an 11% increase in retailer demand.

What does this mean for suppliers to retailers? Even the best ones, Craig and his team found, can fuel substantial increases in retailer demand by working toward incremental service-level gains. And those who ignore this link are missing out on a prime opportunity to boost profit and grow market share.

Check out the Management Sciences research portal for more on the latest work from Fisher’s top-ranked operations faculty.

Hiring, retention a growing employer concern; July event tackling ‘talent war’

For more than 20 years, Duke University’s Fuqua School of Business has been polling hundreds of CFOs once a quarter, asking them what their top concerns are. For the latest survey, they saw something top the list that hadn’t done so once in all 84 rounds before it.

According to a June report in the Wall Street Journal, results of the Duke survey found “Attracting and retaining qualified employees” topped CFOs’ list of concerns for the first time in its history. These talent acquisition and management concerns edged ahead of headline-grabbing issues such as government policies, cost of benefits, economic uncertainty and data security.

Hiring and retention challenges might have topped the list of concerns this time, but they’ve been near the top of the ranking for a number of quarters in the past few years, indicating the issue has broken out of the human resources silo and become a major consideration in businesses’ ongoing efforts to stay competitive. And understanding the forces at play – demographic shifts, a skills gap, to name a few – is an imperative for more than the C-suite and the HR department. Keeping a pulse on this challenge is critical for leaders of any rank.

The Center for Operational Excellence at Ohio State is taking a deep dive Tuesday, July 18, into the so-called talent war in an event co-hosted with the university’s Center for Innovation and Entrepreneurship and Fisher College of Business’ National Center for the Middle Market and Risk Institute. At this half-day, morning session, open to employees of COE members and guests, we’ll be presenting exclusive new data on work-force trends and engaging in a wide-ranging conversation with talent acquisition and management leaders from some of Ohio’s top employers.

At “Winning the Talent War,” you’ll hear insights on:

The Big Picture: Marek Gootman, fellow and director of strategic partnership and global engagements in the Global Policy Program at renowned think tank the Brookings Institution, will be presenting a mix of survey data and research-based insights from the renowned think tank focus on how companies are responding to large-scale shifts in work-force dynamics to hire and retain workers.

The Ground War: The middle section of the morning’s program will be dedicated to a panel discussion led by Fisher senior lecturer and HR expert Marc Ankerman and featuring: Tony Moore, head of talent acquisition, Marathon Petroleum Corp.; Will Shepherd, director of enterprise learning and development, Wendy’s Co.; Kathy Smith, VP talent development, Nationwide; and Kelly Wilson, VP HR-talent management, Cardinal Health.

The Pipeline: The morning concludes with a presentation from Jamie Mathews-Mead, senior director of graduate career management at Fisher, on how the college is preparing students to best meet companies’ rapidly evolving needs and how organizations can leverage Fisher to build and grow their work forces.

With less than a month remaining before the session, limited seating is available for invitees of each center. Employees of COE member companies can register now at no cost using discount code “coesummer” while non-member guests of the center can save half off the $95 admission until July 1 using discount code “coeguest.”

The centers’ collaboration hosts the second of the two-part “Top Business Challenges” sessions Wednesday, Aug. 16, where we’ll be exploring opportunities and risks surrounding data and digitization. Featured speakers include:

  • Jeremy Aston, senior director, Cisco;
  • Bruce Millard, VP digital and customer innovation, Safelite; and
  • Dennis Hirsch, Professor of Law and Director of the Program on Data and Governance, The Ohio State University Moritz College of Law.

Registration for the August session will open the week of July 3.

Head to COE’s events site for more details on these and other upcoming sessions …

Summit speakers talk lean, supply chain, “EQ” in new podcasts

Miss this year’s Leading Through Excellence summit or looking to revisit it?

eric olsen cal poly
Cal Poly Prof. Eric Olsen, who hosted a workshop and breakout at this year’s summit and is featured on the “Manufacturing Tomorrow” podcast.

COE once again has partnered with the Ohio Manufacturing Institute on its semi-monthly Manufacturing Tomorrow podcast to feature speakers from the three-day summit in its two latest editions. In the dual editions of the summit-centered podcast, you’ll hear Executive Producer Kathryn Kelley interview summit speakers:

  • Cary Dunston, CEO of kitchen and bath cabinet manufacturer American Woodmark Corp., a featured breakout speaker for his insights on leadership and emotional intelligence;
  • Derek Browning, director of consulting services for LeanCor Supply Chain Group, who presented a breakout on supply chain excellence;
  • Eric Olsen, director of Central Coast Lean and a professor at California Polytechnic State University, who ran a popular workshop on facilitating lean and offered a breakout session on the “power of lean habits;”
  • and Mark Reich, COO of the Lean Enterprise Institute, who hosted a breakout session on hoshin planning.

You can check out the first round of the podcast interviews, featuring Dunston and Browning, here, while round two – with Olsen and Reich – can be found here.

COE regularly partners with OMI to bring speakers to Manufacturing Tomorrow. Past COE collaborations have resulted in podcasts interviewing Goodyear’s Norbert Majerus, COE Executive Director Peg Pennington, Snap-On Inc. CEO Nick Pinchuk and more.

The full Manufacturing Tomorrow podcast archive is available on iTunes.

CoverMyMeds: Experiment, innovate, grow – hold the jargon

The routine “Best Places to Work” features that offer a snapshot of what it’s like to be a part of Columbus-based CoverMyMeds often focus on what stands out at first glance: The pool tables, the beer tap, the jeans-day-every-day vibe.

nate lusher covermymeds
Nate Lusher of CoverMyMeds presenting at the June 6 COE event.

Nate Lusher, an agile coach at the health-care software startup, says the key to understanding the company’s culture is to look closer.

“Those are great, but they’re not what’s going to keep you there for the long haul,” Lusher told attendees at a Center for Operational Excellence event Tuesday. “They’re an expression of our deeper culture.”

Lusher and colleague Rick Neighbarger, director of quality and risk management at CoverMyMeds, offered a peek inside the Columbus company’s culture at the latest meeting of COE’s IT Leadership Network series. They also detailed their own efforts to make tools and behaviors key to continuous improvement a part of it, a challenge that’s intrinsic to process improvement efforts at companies of any size.

CoverMyMeds, which automates the once-cumbersome prior-approval process for prescriptions, has been a part of the Columbus business community for not even a decade but has drawn attention for its rapid growth and status as a sought-after place of employment. The last time CoverMyMeds disclosed its annual revenue – about two years ago – it was nearing the $100 million mark, and the company just this year closed a deal to be acquired by health-care giant McKesson Corp. for more than $1 billion. Columbus Business First called the acquisition the biggest tech startup exit in the city’s history.

Beneath that surface layer of culture, which the company notably pledged to keep following the sale, is one that values and trusts its people. And the people themselves, Neighbarger and Lusher said, are primed to experiment and take action.

“We’re not afraid to try something out,” Lusher said. “We’d much rather dive in and do it and learn from something.”

The effort of turning that experimentation into lessons learned and, eventually, better processes has included the introduction of a number of lean and agile tools at CoverMyMeds: Kanbans and story cards, metrics on cycle time and work in process (WIP), and an articulated vision of product ownership, just to name a few.

What’s crucial, Neighbarger said, is not what the tools are but how they’re deployed.

“You can’t just pick up techniques that a large multi-national bank uses and drop them into a small health-care IT company,” he said. “You have to tailor your techniques to principles.”

That principle-first approach ultimately has helped gain traction at CoverMyMeds as the company works to deploy a broader quality strategy that continues to manage risks amid continued growth. In short, the jargon matters much less than the results.

“Our goal is not to become ‘agile,’” Lusher said. “Our goal is to become great.”

July summer session takes deep dive into critical work-force challenges

The U.S. work force is at a turning point, with change swirling everywhere: Millennials are now the largest generation in the workplace. Baby boomers – and their decades of institutional knowledge – are nearing retirement after putting it off during last decade’s recession. Constant technological leaps are rewriting the rules for the skill sets that matter.

What does this mean for organizations trying to attract and hire today’s talent? How does this change the game for their ongoing efforts to build culture and develop their existing employees?

The Center for Operational Excellence is teaming up with three other centers for a pair of summer sessions focused on today’s greatest business challenges. The first, “Human Capital and Talent Management,” tackles these vital work-force development issues and on the morning of Tuesday, July 18, at the Fawcett Center.

At this session, gain insights on this issue from three compelling angles:

  • M. Gootman, Brookings Institution

    The Big Picture: Brookings Institution Fellow Marek Gootman will be unveiling results of a new work-force survey conducted in conjunction with the National Center for the Middle Market. The survey, set to be released in late June, looks at how middle-market companies – the fastest-growing segment of the economy – are responding to large-scale shifts in work-force dynamics to hire and retain workers.

  • The Ground War: Join talent management VPs Maura Stevenson (Wendy’s) and Kelly Wilson (Cardinal Health), and Kathy Smith, AVP Executive Succession and Development at Nationwide Insurance, for a moderated panel and audience Q&A session on how their organizations are responding to these work-force trends.
  • The Pipeline: Jamie Mathews-Mead, senior director of graduate career management at Fisher closes out the session with a look at how the college is preparing students to best meet companies’ rapidly evolving needs.

After the presentations, enjoy a networking lunch with members of other Fisher and Ohio State centers. Registration is set to open in June, with limited seating available for members and partners of each center.

The second summer session, set for Wednesday, Aug. 16, focuses on the explosion of data and digital disruption companies face and features a keynote from Jeremy Aston, senior director at communication tech giant Cisco. More details will be announced next month.

Check out all of COE’s upcoming events on our website …