News Feature

Supply Chain Management: Q&A With Santa's CIO

January 01, 2003 — CIO — You think you have supply chain mangament (SCM) headaches? Try being Hermey Elfin for a day. As CIO of Santa Claus LLC's North Pole operations, Elfin manages a supply chain encompassing billions of toys, games, dolls and various other children's products that must be delivered to his boss's 2 billion customers between bedtime and dawn on Dec. 25. His sole means of delivery to all 24 time zones? Nine flying reindeer. CIO recently sat down with Elfin as he was putting the finishing touches on the systems behind Christmas 2002.

CIO: How do you manage all of this?

Hermey Elfin: Well, up until about a year ago, we were operating in a complete legacy environment, so it wasn't easy. We had elves faxing handwritten orders to all of our suppliers—Playskool, Fisher-Price, the Island of Misfit Toys. We finally decided to implement an SCM system, though getting an integrator up here to the North Pole wasn't easy.

What was the rollout like?

Bumpy. Two months before the go-live date, [CEO Santa] Claus wanted to pull the plug because the integrators and elves couldn't agree on some specs. We almost lost Christmas 2001. We had to lock everyone in a conference room for one weekend and hammer out the requirements.

Was it immediately accepted by the line workers?

No. The elves on the shop floor were very resistant to the new ways of handling orders and keeping track of inventory, but I identified some superuser elves, and I showed them how it could improve their ability to schedule better. Now everyone seems real excited. The warehouse supervisor, Yukon Cornelius, says that it was like we struck gold with this supply chain system. And I think he's pretty much right.