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Artificial Intelligence Swarms Silicon Valley on Wings and Wheels (NYT)

The new era in Silicon Valley centers on artificial intelligence and robots, a transformation that many believe will have a payoff on the scale of the personal computing industry or the commercial internet, two previous generations that spread computing globally. Computers have begun to speak, listen and see, as well as sprout legs, wings and wheels to move unfettered in the world. The shift was evident in a Lowe’s home improvement store here this month, when a prototype inventory checker developed by Bossa Nova Robotics silently glided through the aisles using computer vision to automatically perform a task that humans have done manually for centuries.

How Manufacturing has changed (Economist)

Manufacturing has not really gone away. But nor has it held still. Some processes that used to be tightly held together are now strung out across the world; some processes that used to be quite separate are now as close as the workers and designers who share the shop floor in some factories. Assembling parts into cars, washing machines or aircraft adds less value than once it did; design, supply-chain management, aftercare, servicing and the like add much more.

Adidas’s high-tech factory brings production back to Germany (Economist)

Behind closed doors in the Bavarian town of Ansbach a new factory is taking shape. That it will use robots and novel production techniques such as additive manufacturing (known as 3D printing) is not surprising for Germany, which has maintained its manufacturing base through innovative engineering. What is unique about this factory is that it will not be making cars, aircraft or electronics but trainers and other sports shoes—an $80B-a-year industry that has been off-shored largely to China, Indonesia and Vietnam. The Speedfactory, as this plant is called, belongs to Adidas, a giant German sports-goods firm. Production is due to begin in mid-2017, slowly at first and then ramping up to 500,000 pairs of trainers a year. Adidas is constructing a second Speedfactory near Atlanta for the American market.

Kellogg Revises Distribution Method (WSJ)

Kellogg Co. is abandoning its traditional way of delivering some snacks to stores in an effort to cut costs, though it risks hurting sales of some products. The maker of Cheez-Its and Keebler cookies, which reported fourth-quarter earnings Thursday, will begin delivering its U.S. crackers and cookies to grocery stores’ warehouses, rather than directly to the individual stores.

World’s biggest shippers don’t grasp supply chain impact on climate change

The world’s largest corporations are failing to work with supply chain partners on climate change, according to a survey of 4,000 suppliers to the world’s leading shippers. The Carbon Disclosure Project polled suppliers to 89 of the world’s largest firms – including Walmart, Microsoft, and Coca-Cola – to assess how the multinationals were responding to and tackling climate change. While the report found that 68% of major shippers recognized the benefit of taking action, only 22% had engaged with suppliers and just 4% had actually actioned supply chain emissions targets.

JIGGERY-BESPOKERY (Economist)

In its tireless struggle to innovate, fashion is turning to mass customization. This trend is both very new and very old.

An iPhone’s Journey, From the Factory Floor to the Retail Store (NYT)

After the iPhone leaves the Foxconn factory in Zhengzhou, it takes two days, on average, to get to a store in Shanghai, a 590-mile trip. It takes three days, on average, to get a store in San Francisco, some 6,300 miles away. Chinese customers can pay much higher prices, because of currency fluctuations and the country’s hefty value-added tax. A 32-gigabyte iPhone 7 sells for about $776 at the Apple Store in Shanghai. In New York, it goes for $649.

Merck Deploys AI For ‘Self-Driving’ Supply Chain (WSJ)

Company is in a multi-year project to improve demand forecasts, plans to deploy sensors and algorithms throughout its supply chains for pharmaceuticals and health-care products. The goal is to create an autonomous supply operation where computers make more decisions about allocating materials and distributing products,

Siemens and General Electric gear up for the internet of things (Economist)

The two firms are taking very different paths towards digitization. GE is completely reinventing itself, whereas Siemens is staying close to its roots. Siemens tends to be organised in vertical, industry-specific silos, such as machine tools and medical equipment. GE typically comes in horizontal, widely used layers, such as computer operating systems.

Amazon Moves to Cut Checkout Line, Promoting a Grab-and-Go Experience (NYT)

In the latest in its expanding set of experiments involving bricks-and-mortar retail stores, Amazon has created a small grocery store in Seattle that will allow customers to pluck drinks, prepared meals and other items off shelves and walk out without having to wait in a checkout line, the company said.

As Gap Struggles, Its Analytical CEO Prizes Data Over Design (WSJ)

Under Mr. Peck, a former partner at Boston Consulting Group who arrived at the company in 2005, Gap Inc. has put operational executives in control of its major brands, including Old Navy. It has also expanded the role of outside vendors—some of which have their own design teams. Mr. Peck favors a model in which things are more decentralized. Brand merchants, who serve as collection editors, are no longer involved in every product category. Some items, like men’s dress shirts, can be stamped out by a foreign supplier without approval from a head designer. He is also pushing executives to pay more attention to Google analytics and market-research data to monitor consumer tastes.

Choke Point of a Nation: The High Cost of an Aging River Lock (NYT)

Lock No. 52 is a serious bottleneck in innumerable supply chains nationwide. It is emblematic of the nation’s crumbling transportation infrastructure coast to coast — including locks, ports, highways and railroads. The average delay at No. 52 in October and November was 15 to 20 hours. At the moment, No. 52’s sister dam downriver, No. 53, is adding 48 more hours to the wait.

Zara’s Recipe for Success: More Data, Fewer Bosses (BusinessWeek)

Zara has unique practices that may account for its success
– Unlike rivals such as Gap, H&M, and Primark, Zara has no chief designer, and there’s little discernible hierarchy. Its 350 designers are given unparalleled independence in approving products and campaigns, shipping fresh styles to stores twice a week. Guided by daily data feeds showing what’s selling and what’s stalling, the teams develop fashions for the coming weeks.
– It “pulls” ideas from consumers, rather than designing collections months in advance and “pushing” goods on shoppers with ads.
– Its supply chain which consists of a network of factories in Spain, Portugal, and Morocco that produces 60 percent of its merchandise. With production nearby, it can quickly switch gears if weather or fashion trends change, getting designs into stores in as little as two or three weeks, while rivals’ orders slowly make their way across the ocean on container ships.

Blockchain has the potential to revolutionize the supply chain (TechCrunch)

Blockchain has the potential to transform the supply chain and disrupt the way we produce, market, purchase and consume our goods. The added transparency, traceability and security to the supply chain can go a long way toward making our economies safer and much more reliable by promoting trust and honesty, and preventing the implementation of questionable practices.

How to Fight Amazon.com, Best Buy-Style (WSJ)

1) Prevented showroom shoppers from buying elsewhere.
2) Committed to matching competitors’ prices and brought its prices in line with Amazon’s.
3) Improved its website and mobile app.
4) Used its stores to improve its e-commerce operations.
5) Used its stores for competitive advantage.

Walmart Wants to Apply Blockchain to Other Products Beyond Pork

Trying to make pork products in China safer was just the first step of Walmart’s global plans for blockchain. The pilot unveiled last week uses technology from the Hyperledger project to track pork shipping information, including farm origination details, batch numbers and storage temperatures on a secure blockchain. Over the months ahead, the retail giant wants to expand on that work.

Amazon’s Newest Ambition: Competing Directly With UPS and FedEx (WSJ)

To constrain rising shipping costs, the online retailer is building its own delivery operation.