If Meri Stevens hadn’t become a supply chain manager — she’s currently global vice president of supply chain and delivery for Johnson & Johnson Consumer Health — she might have had a career as a cardiologist.
In a recent conversation we had about J&J’s supply chain, the phrase flow blockers came up several times. This makes sense if you think about how blood flows through the body and how goods need to move through the supply chain: both sometimes require intervention to keep things flowing properly. “I think of the flow as a digital thread that starts with the consumer and then goes all the way down to the ground through our partners to our suppliers,” she said. “We are looking for flow blockers in this thread and asking how we can use automation and digital technologies to eliminate them.”
Digital transformation is an area garnering a significant percentage of supply chain investment at J&J, a perennial leader on Gartner’s list of the Top 25 Supply Chains, including number 3 in 2022. But digital transformation isn’t was just one of the topics we covered. They also understood reliability and resilience, the importance of having a seat at the C-suite table, and winning the war on talent.
A Career in Supply Chain
Stevens is an engineer and supply chain veteran with over 30 years of industry experience. She began her career in operations management at GE, where she spent over a decade. Prior to joining J&J in 2015 as Vice President of Supply Chain Strategy and Deployment, she worked at companies as diverse as Bertelsmann, Tyco and Newell Rubbermaid, where she served as Director of Supply Chain. supply for two years. “I think I’ve been in every industry except food,” she said, adding that J&J marks her third health industry tour. “If you think you’re leaving a lasting impact, health is a key area where you really want to drive something different.”
She has this opportunity at J&J, where her portfolio includes all processes in the SCOR model, from planning and direct material sourcing to manufacturing, delivery and return functions. She is responsible for the delivery of J&J products that touch our daily lives, such as BAND-AID® brand adhesive bandages, suntan lotion, allergy medications, TYLENOL®, LISTERINE® and shampoo, to name a few. name a few. His team was responsible for the cold chain that delivered J&J’s COVID vaccine, and they were involved in redesigning the medical device organization from a delivery perspective.
Reliability and resilience
The consumer healthcare supply chain is massive. Stevens oversees operations that serve more than a billion people every day in 60 countries. What drives this supply chain? First, its “reliability and resiliency choices,” Stevens said. “When you serve over a billion people a day, the most important thing is to make sure that when you reach our product on the shelf, it will be there for you.” This has never been more important than before the development of COVID vaccines and antivirals, when consumers around the world sought out TYLENOL® for some relief from their symptoms. Demand for an otherwise stable product has skyrocketed.
This focus on reliability influences decisions about how J&J balances what it manufactures in its own facilities versus its manufacturing partners – what Stevens described as “manufacturing in a way that creates agility”; whether the product is stocked in J&J distribution centers or with 3PLs: and, increasingly, how and where the company sources materials and develops new suppliers. “One of the things we’re working on extensively is understanding our dual sourcing strategy,” Stevens said. “And because, in many cases, our portfolio has been built through acquisitions that can sometimes take us longer.”
“Our two axes are where the consumption is happening and where is the best source of supply,” she said. “With these, we look at the partnerships we have developed. In a perfect world, I would have everything nearby, infinite capacity and 100% agility. But, in an imperfect world, I’m limited by where I am today and the changes I can make now. So it’s about balancing those things as you go along.
Respond to volatility
Like most organizations, J&J’s supply chain has been tested during the pandemic. “The biggest thing we experienced was volatility, especially in the consumer sector,” Stevens said. “We’ve seen a lot of variation in where people are buying products and what they’re buying.” Demand for some traditionally stable products has doubled and tripled.
As a result, J&J is investing heavily in digital capabilities to better detect and understand demand. “There’s been an explosion in this area that allows companies to combine different types of data,” Stevens said. These include the structured data that companies have always relied on, such as historical sales and channel data for specific products. But also unstructured data. For example, J&J incorporates weather data to better understand how consumers buy sunscreen and allergy medication.
“People are buying products like ZYRTEC® that used to be seasonal almost year-round,” Stevens says. “So now we’re using digital tools to forecast demand down to shelf level.” This is the demand at the macro level. But J&J is also focused on understanding how demand in a place like Peoria might differ from New York City, as well as whether consumers in those locales are buying in the local store or online. “We want to understand the total global demand for a product to ensure we have stock available where and when it’s needed,” Stevens said. “That’s why these investments in digital capacity are critical to capacity management.”
She added, “We are investing for the long term because we believe some trends have changed permanently.”
Pull digital wire
J&J’s digital investments aim to transform the supply chain from a constraint into a competitive advantage. The digital thread that Stevens referred to earlier is this ability to get every bit of information about every step of the process. “I want to be able to spot trends so I can be adaptive and predictive to drive responsiveness,” Stevens said. “With this wealth of information, I can see where I have what we call flow blockers in the thread. These are the biggest opportunities to use automation, whether it’s automation digital, robots or 3D printing We ask how we can use these capabilities to remove this flow blocker so I can make the thread run faster.
In an organization as large as J&J, digital initiatives take place in all processes: team members go on reconnaissance to identify promising new solutions; test them; and if successful, scale them. Stevens identified two projects currently underway. One is a project with a startup and one of the world’s largest retailers to use smart digital automation to predict how much product will be taken off the shelf at any point of sale. The solution brings together the unstructured data that Stevens referred to earlier as well as the point-of-sale and inventory data that J&J already receives from retailers. “We got amazing results in testing, so now we’re scaling this solution globally,” she said. “It will work just as easily with our large retail partners as it does with our smaller mom and pop stores in India.”
The second project is an optimization engine to make better use of trailers and shipping containers, both of which are severely constrained – clearly flow blockers. “We’re able to take order information for a load and optimize the use of trailers and containers in a way that really allows us to increase capacity.” A side benefit is that better use of containers means fewer trucks on the road, which also results in lower carbon emissions. “We get the benefit from a cost perspective, but we also get the benefit of reducing greenhouse gases,” Stevens said.
Considering all the emerging technologies available today, I wondered if there was one in particular that Stevens was looking at. “What we explore depends very heavily on what we think is the biggest flow blocker to attack,” she said. “Rather than trying to solve all flow blockers at once, we are prioritizing and focusing. This allows us to move fast.”
Supply chains are always about people
Despite all the attention to technology, supply chains are still managed by people. And, people are perhaps the biggest constraint – the biggest flow blocker – in today’s supply chains, including J&J. “We fight for people every day,” Stevens said. Her goal is to create a culture that embraces diversity “where everyone can walk into the office every day feeling like they can be their best selves,” she said. “It’s about finding great talent through different ways of thinking, and then allowing those great talents to feel included.”
Stevens is directly involved in J&J’s WiSTEM2D initiative, or Women in Science, Technology, Engineering, Math, Manufacturing and Design, and is the Executive Sponsor of the Youth Pillar. “We think women and especially disadvantaged people or people of color tend to fall off the rod lane at a young age. Once you fall, you can’t recover,” she said.
She noted that J&J held events around the world almost daily to engage women and girls in science and technology. The company also sponsors a program called Johnson & Johnson Re-Ignite, which aims to bring women with a science and technology background back into the workforce who may have left the field to raise children or care for parents. .
“We want to make sure that we open our doors to all types of talent so that we can be the great company that we want to be all the time,” Stevens said.
About the Author
Bob Trebilcock Bob Trebilcock, Managing Editor, has covered material handling, technology, logistics and supply chain topics for nearly 30 years. In addition to Supply Chain Management Review, he is also editor of Modern Materials Handling. A graduate of Bowling Green State University, Trebilcock lives in Keene, NH. He can be reached at 603-357-0484.