Bro braus ugl supplychain nov2015

C O M PA N Y O V E R V I E W IN PARTNERSHIP WITH: Delivering solutions.

End-to-End Mobile Communication Solutions

UGL Adapting its

supply chain

The diversified services firm, which specialises in the delivery of critical assets within Australia, has been in the process of switching its supply chain methodology for the benefit of its end users.

Written by: Sam Jermy

Produced by: Vince Kielty 3

UGL

UGL’s ultimate objective is a dynamic supply chain that is responsive to its customers.

U

GL Limited has been on a journey to fundamentally change its operations, in order to get ahead of the industry curve and continue to see the $2.3 billion business grow.

The company, which trades on the Australian Securities Exchange, is a leading provider of end-to-end outsourced engineering, asset management and maintenance services with a diversified endmarket exposure across the core sectors of Rail, technology systems, power, resources, water and defence.

With over 8,000 employees 4

November 2015

(including subcontractors) across Australia and South East Asia, the company partners with some of the world’s largest blue-chip companies, government agencies, and private enterprise/public institutions.

It is not an easy task to revise the supply chain strategy of any company, as it is intrinsically linked to daily operations. Dean Newman, Head of Supply Chain for Rail Freight at UGL, explained the Rail Freight business’ journey in detail. He said: “Our underlying fundamental principle is the maintenance and construction of assets; that’s the

S U P P LY C H A I N

UGL’s Rail division falls under the Rail, Defence and International (RDI) umbrella.

same regardless of sector. With regard to Rail, the building of assets has changed; there’s not the mining boom that there once was and the construction of heavy rolling stock has declined as a result.”

“Importantly, UGL currently remains the only builder of locomotives in Australia. In the build space, we are General Electric’s representative in-country. We build locomotives either as a coOEM (Original Equipment Manufacturer) product or as a GE product under licence supervision. We have a co-OEM product that we build with them; the C-44 locomotive. As the landscape changed, where we were a large prolific builder of locos and wagons, now there is far greater emphasis on the maintenance of assets.”

“Importantly, UGL Rail currently remains the only builder of locomotives in Australia. In the build space, we are General Electric’s representative incountry.”

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Delivering solutions.

You serve the world’s markets.

So do we.

Your top priority is that your cargo reaches its destination – not how it gets there. With our global network, we perfectly combine rail, road, ocean, and air freight to ensure that your goods make it anywhere in the world. Safely, reliably, and right on schedule. And we do it quickly, efficiently, and affordably. From simple transport services to complex logistics processes, we have tailormade solutions to fulfill your needs.

Let us serve you.

For inquiries please contact:

Schenker Australia Pty Ltd 72-80 Bourke Road Alexandria (Sydney) NSW 2015 Australia

Phone: +61 2 9333 0333 Fax: +61 2 9333 0496 Email: info.au@dbschenker.com www.dbschenker.com

UGL

S U P P LY C H A I N

Strategic shift As such, the supply chain that underpins the Rail freight business has had to shift radically. The primary shift has been moving away from an inventory push methodology associated with materials pushed into the supply chain, to support the build of locos and wagons: UGL now has to be far more dynamic, adaptive and aligned to what the customers expect from the firm.

Newman said: “We hold a unique position now. Most of the locomotive manufacturers exited in the last 12 to 18 months because of the low demand. So

in today’s world we’re adopting an inventory pull methodology.

Over the last 12 months UGL has been driving the implementation of a really robust sales and operations planning (S&OP) process, where we endeavour to get marketing information from customers (internal/external), look at historical consumption and insert a predictable variability factor, because in the maintenance business you’re always going to have emerging type work. It’s all about trying to build the right forecast model.”

“Our ultimate objective is a

SUPPLIER PROFILE THE INTEGRATED LOGISTICS GROUP

DB Schenker stands for performance, service and safety, regardless of the complexity or extent of logistics tasks and requirements. We are well equipped for any and all challenges thanks to our robust business model. Merging international markets and increasing flows of goods are challenges we face every day, and at the same time are what drives our business.

Schenker Australia Pty Ltd was established in 1962 in Sydney and provides a complete range of international air and sea freight forwarding together with integrated logistics services from its premises in Sydney, Melbourne, Adelaide, Brisbane, Perth and a subsidiary office in Auckland, New Zealand.

With more than 1,100 employees and over 240,000sqm of storage capacity, DB Schenker in Australia and New Zealand is well-positioned to handle unique requirements of any industry. Our certifications and recognitions emphasize our commitment to provide quality service to its customers and continual improvement and its commitment to environmental responsibility.

Website: www.dbschenker.com w w w. u g l l i m i t e d . c o m

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C&J SHEETMETAL FABRICATIONS

One-Stop Shop Approach C & J Sheetmetal Fabrications started in 1990 and over the past 25 years our Company has grown due to providing Excellent Customer Service, Quality Products and On Time Delivery.

We service the Rail, Mining, Defence, Industrial and Engineering sectors in Australia. We currently have an Australia wide client base, which generates repeat business.

Quality Management System – ISO 9001:2008

WE ARE SPECIALISTS IN:

• Laser and Water Jet Cutting • CNC Pressing, Punching & Folding • Stainless Steel, Aluminium and Mild Steel Fabrication, by Certified Welders • CNC Machining / CNC Milling • Sandblasting • Spray Painting to Automotive Quality

Ph: +61 2 4904 0000 Fax: +61 2 4947 1166 Email: sales@candjsheetmetal.com.au

1 Waterloo Street Bennetts Green NSW 2290 www.candjsheetmetal.com.au

UGL

S U P P LY C H A I N

dynamic supply chain that is responsive to our customers. But more importantly it will become a fundamental enabler for the reduction of inventory held within the business and will improve the ROCE (return on capital employed), making sure inventory is not on shelves being lazy; it is actually working for us.”

“Two years ago we were very much in the build space and now that shift has seen the supply chain change to the maintenance of assets instead. Historically we had a business referred to as the National Freight Parts Sales, which had rendered supply chain capability.”

UGL has now implemented a more robust supply chain focusing on operational efficiency, core competency, and total quality management across its Rail division. Inventory management

SUPPLIER PROFILE

Dean Newman - Head of Supply Chain for Rail Freight at UGL

C&J SHEETMETAL FABRICATIONS

Established in 1990 C & J Sheetmetal Fabrications enjoys a reputation as one of most respected names in our field. We are a family owned Company that has been running for over 25years.

Our vast industry knowledge, highly experienced tradesmen and state of the art equipment allows us to offer our customers options not normally available from one location.

We carry a wide range of sheet and plate in stock and can respond to your urgent requirements.

C&J Sheetmetal are committed to offering a quality product and better service at very competitive prices. We conform to a Quality Management System ISO 9001:2008.

Website: www.candjsheetmetal.com.au w w w. u g l l i m i t e d . c o m

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UGL is a leading provider of end-to-end outsourced engineering, asset management and maintenance services

UGL

S U P P LY C H A I N

has also improved, with sales and operational planning helping to move from the push to pull methodology in response to changing market needs.

Implementation in Australia The Australian engineering and Rail sectors spent a lot of time where a push supply chain strategy was the best option according to Newman, because it was simply more important to keep customers’ rolling stock moving in industries such as mining. Compared with the FMCG (fast moving consumer goods) world, which has a far more mature advancement of pull strategies, mining and Rail have been slower on the uptake.

Newman suggests the Rail industry in Australia is now also awakening to this pull methodology though. He said: “It’s been a tough road at times because it has been a paradigm shift from the way in which the business operates, and the entire mindset has to change. We’re moving from buying ‘just in case’ and trying to push that to a market where we move to a strategy that says ‘no, let’s understand what we will need and when we

Dean Newman

“The outlook is positive in that we’ll continue to diversify and serve our customers with exceptional service, and as we migrate from a push to pull inventory strategy it will help us to help them.” w w w. u g l l i m i t e d . c o m

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End-to-End Mobile Communication Solutions base2 is an original equipment manufacturer (OEM) of communications and control room hardware and software. From product inception, electronic design, mechanical design, testing, rmware and software, through to production, all engineering and manufacturing services are performed in-house.

• The base2 ICE, In-Cab Communications Equipment is a modular communications device speciically designed for the rail industry.

• The base2 VCS is a control room system for integrating voice and data communications systems into a touchscreen operator console.

• The base2 National Train Communications System (NTCS) is used for all train control communications on the Australian Deened Interstate Rail network and selected regional areas.

28 Pritchard Road, Virginia, Queensland 4014, Australia Ph: +61 7 3637 5444 | Fax: +61 7 3637 5445 | Email: admin@base2.com.au

www.base2.com.au

UGL will need it.”’

“Implementation of pull methodology on inventory stocking is a key focus for the supply chain function, as has been the ‘rights’ of the customer, be that internal or external. An internal customer is where we are facilitating movement of materials for one of our maintenance or build facilities that maintain or build locomotives all over Australia. Externally, some customers maintain their own assets, so they would procure their own materials from us to facilitate their asset management.”

At the same time, UGL has been

SUPPLIER PROFILE

S U P P LY C H A I N

incredibly focused to ensure this operational shift does not result in a decline in its customer service offering. This has been an absolute deliverable for the firm as it has transformed the supply chain over the last year. “Competition is no longer between companies, it’s between supply chains.” added Newman. “It is difficult to compete on price, brand loyalty is diminishing, there are lowcost economies all over the world; but a supply chain that delivers the right product, in the right place at the right time, and for the right customer in the right quantity and quality … well, you can’t beat that.”

BASE2

Established in 1987, base2 has been responsible for design, manufacture and software for numerous control room systems worldwide. Products are developed primarily for the Transport and Life Safety industries. Engineering and manufacturing are performed at base2 facilities in Australia. This includes mechanicalmanufacturingviaComputerNumericControlled(CNC)equipment through to electronic assembly via an automated surface mount Printed Circuit Board (PCB) production line.

Current ongoing projects include the National Train Communications System (NTCS), the Victoria Regional Rail Communications Network (RRCN) and ICE integration with Sydney GSM-R Digital Train Radio System (DTRS).

Website: www.base2.com.au

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C O M PA N Y N A M E

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Key differentiators UGL’s Rail division, which falls under the Rail, Defence and International (RDI) umbrella, has a strong philosophy of being an employer of choice not circumstance. Despite the reduction in the manufacturing space, the company has continued to evolve its maintenance division though diversification of services.

This has resulted in a new component overhaul division (COD), which is able to leverage its large manufacturing and workshop facilities for wider use. Split into mechanical and electrical, the new

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division also utilises the strong partnerships it has built in mining and Rail with the likes of GE, Pacific National, Aurizon, Rio Tinto and several other similar organisations.

Newman said: “Many of our customers have some ability to do their own in-house maintenance in their own right. That’s why we sell parts to them as our external customers. But with the (COD) division we service, repair, refurbish and overhaul equipment as new.”

“One of the greatest technology advancements UGL has managed to achieve in the last two years and

SECTOR

successfully rolled out over the last six months has been our mobility solutions. We have invested heavily into Service and Asset Management Mobility (SAM) to ensure work execution efficiency and quality is maximised.”

SAM Mobility is a direct user interface for workshop employees to UGL’s quality and material resource planning. Mobility provides portability via an iPad (in a rugged case) so that technicians can perform routine tasks, recognise and create ‘on condition’ tasks, conduct and record ‘strip and quote’ tasks, review and enter

measurement points, and record serialised equipment changeovers.

UGL is now able to see all open work for rolling stock while out in the field, complemented by 24 hour support crew.

“It has changed the world of our service technicians, they’re now able to create service orders, and give real-time updates. It drastically reduces the risk of errors, has improved stakeholder engagement and provides excellent supply chain visibility. Giving technicians access to our systems and engagement of communication tools, like having email accounts and internet access w w w. u g l l i m i t e d . c o m

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UGL

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S U P P LY C H A I N

has had a positive employee engagement spinoff which is truly wonderful,” added Newman.

If this wasn’t impressive enough, UGL has also brought its own unique industry product to the market. The FlexiCurve™ bogie is UGL’s premium locomotive bogie, providing significant benefits in locomotive performance, reliability and maintainability. FlexiCurve™ is a family of bogies for applications ranging from 90t, 1 metre Narrow Gauge through to 160t, 1.7 metre Broad Gauge. UGL won the Regional (Newcastle) Engineering Excellence Award for this earlier in 2015. Developed in Australia by UGL Limited, the FlexiCurve™ has become GE’s bogie of preference when selling locomotives out of North America, something the company is incredibly proud of.

Asked about what the future holds for UGL, Newman concluded: “The outlook is positive in that we’ll continue to diversify and serve our customers with exceptional customer service, and as we migrate from a push to pull inventory strategy it will help us to help them. We’ll also be able to take a far greater level of proactive, pragmatic deliverables as we move forward with our technological solutions, so we’re in a very strong position in that regard.”

When the world and its industries change once more, UGL beyond all others will be very well positioned to maximise the upturn potential.

Company Information INDUSTRY

Supply Chain HEADQUARTERS

Level 5, 40 Miller St North Sydney NSW, Australia, 2060 FOUNDED

UGL originated as a small engineering business in Western Australia in the late 1960s EMPLOYEES

8,000 REVENUE

$2.3 billion

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UGL Level 5, 40 Miller St North Sydney NSW, Australia, 2060 www.ugllimited.com