CRITICAL MASS, MEASUREMENT BIG ITEMS ON ECR'S AGENDA

LINDA PURPURA

CHICAGO -- Achieving critical mass ranks high on the official Efficient Consumer Response agenda for next year.

The ECR Executive Committee, which met here last month, set expanding the depth and breadth of industry involvement in core ECR programs, and developing a method for measuring progress, as top priorities heading into the new year.

The group also completed agenda plans for next year's annual ECR Conference, March 12 to 14 in Atlanta. Among the keynote speakers heading the event are Mike Wright, chairman, president and chief executive officer of Supervalu, Minneapolis; Drayton McLane Jr., president and CEO of McLane Group, Temple, Texas, and Mike Hammer, co-author of the book "Reengineering the Corporation."

The committee also confirmed that several more ECR case studies, including one in the area of category management, will be released before next spring's ECR conference.

Those were among the key areas discussed and acted upon in the Nov. 14 ECR Executive Committee meeting, which took up a list of recommendations drawn up by the ECR Operating Committee.

Gary Capshaw, vice president of logistics at Fleming Cos., Oklahoma City, and Jack Haedicke, vice president of ECR finance at Kraft Foods, Northfield, Ill., shared highlights of the Executive Committee's decisions in an interview with SN last week.

Capshaw and Haedicke are co-chairmen of the ECR Operating Committee, which will focus enormous attention on the key areas of education and communications heading forward, they said.

The next big goal for the Joint Industry ECR Project is pushing to achieve critical mass for ECR, meaning that fully one-third of the industry is actively involved in the core competency areas of efficient promotion, efficient assortment, efficient replenishment and efficient new product introduction.

Capshaw said reaching critical mass is key to ECR.

"If the industry reached a certain critical mass, then ECR would have its own momentum and could go on its own. It wouldn't necessarily need a committee structure to keep it going," Capshaw said. "We're not there yet and we need to get there."

Determining what critical mass is also remains a crucial question, Haedicke said.

The annual ECR Status Report conducted by Kurt Salmon Associates, Atlanta, indicated that 16% of the industry, including retailers, wholesalers, manufacturers and brokers, were using the "four E's" of ECR to significant extent in their business practices at the end of 1995.

But deciding how that figure should be measured to reflect real-world activity even more precisely is an issue that the ECR committees will be working on with Kurt Salmon Associates, Haedicke said.

The ECR group also wants to measure how far the industry has come in 1996, and thus how far it still has to go to reach critical mass, or one-third of the industry participating fully in the "four E's."

To help the industry better understand its focus on critical mass, the ECR committees will be stepping up their efforts in the core areas of communications and education.

As one example of its ongoing education effort, Haedicke said, 150,000 copies of its ECR Best Practices documents have already been distributed and 2,000 copies of the CD-ROM ECR document have been produced.

Results of the EDI survey, for example, will be presented at the next ECR Operating Committee meeting in mid-December. A dictionary defining ABC models at different stages of the value chain also will be issued by year-end. In addition, illustrative case studies to go with the ECR efficient assortment document will be released in the next few months.

Reports to be released in February include the ABC study on CRP benefits; a document outlining CRP success and failures, and a study on optimum order quantities and the potential trade-offs between using full vs. partial pallet loads.