June 2017 Issue 38
ENHANCING THE BUSINESS OF LOGISTICS
THE HUMAN RESOURCE
Detrimental to business success
Hiring and salaries 2017 How is it looking?
Green tech
Bee’ah and Masdar sign JV
KSA’s healthcare
Medical cities, insurance and more
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He/she is the most important aspect of any business. The success of every venture depends on the employee. So how are UAE businesses from the logistics and supply chain sector taking care of their revenue generating businesses and the people who help them make their revenues during this not-so-ideal time? For our cover piece we spoke with leaders from three important companies - Freightworks, Blue and Globe Express Services to get their insights. Our experts suggest that while the oil and gas industry doesn’t look like it’s going to be making any major changes for now, other industries such as construction, tourism and hospitality seem to be moving in the right direction in the short term. The core sector - supply chain - is however, looking better than most. And with e-commerce gaining impact, last mile delivery companies are looking at busier times ahead since Amazon is making it’s presence felt in the region. The most important thing for businesses to continue doing is making changes big and small to adjust to market forces. And most important to this equation is always the team. That is what will translate to success or failure. Turn to Page 22. We’ve also spoken to recruitment experts to get to know how regional companies are treating their employees in terms of salaries, retaining, training and benefits. Page 32 has more. We also have a report from the International Renewable Energy Agency (IRENA) stating how numbers of people working in this area are increasing worldwide. Page 40. Lots of analysis, dialogue and news as always is packed in this issue. Do let us know your thoughts. Have a happy and blessed Ramadan and Eid Al Fitr and we’ll see you next month.
Munawar Shariff Managing Editor munawar@signaturemediame.com
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June 2017 Issue 38
ENHANCING THE BUSINESS OF LOGISTICS
46 Cargo connection
26 06 News 16 Country report Kingdom of saudi Arabia Big changes ahead for Saudi Arabia’s health care sector Rising consumer demand and an increased role for the private sector look set to drive expansion and open new doors for investors in Saudi Arabia’s health care industry
22 Cover The all important human resource Munawar Shariff speaks with leaders from different industries of the logistics and supply chain sector about the people factor in successful business
32 Hiring and salaries 2017 Munawar Shariff speaks to leading recruitment experts to gauge the hiring scene 4 JUNE 2017
36 Making tracking easier Leading British retailer, John Lewis, is rolling out a UHF RFID solution
38 Toyota tests zero emission truck Toyota puts zero emission fuel-cell semi-truck to test at the Port of Los Angeles
40 Jobs in renewable energy Renewable energy employs 9.8 million people worldwide, as indicated by a new IRENA report
42 Asset management with RFID Mike Beedles, Director Integration Services, SATO America, talks about how RFID Technology simplifies asset management
Milaha launches door-to-door shipping service between Qatar and the UAE, targeting the SME market
48 Green tech - Bee’ah and Masdar join forces Bee’ah and Masdar launch joint venture to develop the first waste-toenergy plant in the region
52 Kanoo - raising industry standards A chat with Krishna Kumar, GM, Logistics – YBA Kanoo, to find out the status of the sector
54 Wannacry: An Analysis of Competing Hypotheses The Digital Shadows Analyst Team analyses the recent WannaCry cyberattack
60 Investing in the future SAP to build skills and knowledge to support Middle East youth job creation
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Ajman Free Zone opens office in Cyprus
Utico wins ‘Desalination Company of the Year’ Distinction award at Global Water Summit 2017 Utico has bagged the ‘Desalination Company the Year’ distinction award at the Global Water Summit 2017, the first UAE company to win the coveted annual award at the world’s premier business gathering for the water industry worldwide held in Spain. Utico is the only company from the Middle East to win the coveted award. Utico won the honour for developing a trailblazing independent water and power project (IWPP) model, distinctively positioning the company as a private water utility, dealing directly with the end users and government bodies alike. The award was given by Global Water Intelligence with worldwide industry peers voting and assessment by an eminent independent jury. The citation by the Global Water Award committee said that Utico has taken the desalination industries development model to the next level, lining up a string of power and water projects around the Gulf, while spreading its wings abroad through acquisitions, particularly mentioning its takeover of Minjur acquisition plant in Chennai, India last year.
Richard Menezes, Managing Director of Utico (centre) receiving the award. On his left is Christopher Gasson, Publisher, Global Water Intelligence, and Nassim Nicholas Taleb, Former Trader, Risk Specialist and Author, speaker at Global Water Summit.
In line with its global outreach strategy to secure new investments, Ajman Free Zone announced that it has opened a representative office in Cyprus, and has also entered into an alliance with Freemont Group, a business and corporate consultancy with offices in both Nicosia and the UAE. In a statement, the free zone said that the alliance with Freemont Group will help the free zone woo and facilitate investments from Cypriot entrepreneurs who are keen to create a business base in the UAE. Over the years, the free zone’s active engagement of the global market has led to a consistent rise in investments from across the world, contributing to the reputation of the UAE as a stable economy for entrepreneurs to set shop. Last year, the UAE opened its embassy in Nicosia, the capital of Cyprus, a move which has helped further accelerate economic and social cooperation between both the countries, and Ajman Free Zone, known for its proactive investment facilitation, stands to benefit from the robust mutual relations.
Koch Supply and Trading, JOVO, MISC, and Teekay Marine Solutions sign pioneering deal in LNG Ship-to-Ship transfer Koch Supply & Trading (KS&T) has announced the completion of the first of multiple and regular ship-to-ship (STS) LNG transfers with private Chinese company JOVO and Malaysian ship owner MISC. The agreement is the first of its kind for KS&T, JOVO and MISC, and is the first LNG STS
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transfer in the Philippines. With LNG STS transfers traditionally serving more of an operational role, this project represents a key commercial milestone as a recurring STS transfer demonstrates the commercial potential of such activities. Such operations open new markets
for exporters, and provide new supply sources to those with LNG requirements. In this example, the mother vessel loads cargo from Australia before transferring it to a smaller daughter vessel at Subic Bay in the Philippines. The operation is carefully managed by Teekay
Marine Solutions with Teekay and MISC providing their extensive LNG experience to administer a safe and successful transfer. The cargo is then delivered to JOVO’s Chinese terminal, where it is distributed by truck to one of their many industrial or commercial customers in Southern China.
Rockwell Automation CEO discusses future of industrial IoT Blake Moret, president and CEO of Rockwell Automation, spoke on Internet of Things (IoT) adoption and its impact on industrial productivity, sharing insights with more than 1,200 business leaders at Cisco’s IoT World Forum in London. As the industry’s only company solely dedicated to industrial automation and information, Rockwell Automation is uniquely positioned to understand the challenges and opportunities associated with harnessing the future of smart manufacturing. The positive outcomes associated with IoT will continue to accelerate as organisations progress from pilot or proof-of-concept IoT projects to scalable IoT deployments. According to the Global IoT Decision Maker Survey, published by International Data Corporation (IDC), nearly one-third (31 per cent) of those surveyed have already launched IoT solutions, and another 43 per cent are looking to deploy solutions in the next 12 months. Moret explained how a connected enterprise that adopts IoT technologies can generate better insight into industrial operations and deliver greater value by providing the right information at every level of their business through scalable analytics. The 2017 IoT World Forum explores the impact of IoT on business, technology and society. As strategic partners, Rockwell Automation and Cisco have long collaborated on industrial networking and security solutions required for industrial digital transformation.
SITA solves the multi-merchant challenge for payment acceptance at airports SITA has launched the first payment solution that addresses the need for airlines to be able to accept payments securely at airports when using a shared IT infrastructure. SITA AirportConnect Common Use Payment Service enables payment transactions by multiple airlines on a single payment terminal. Importantly, this is possible with any, and all, of the departure control systems the airlines choose to use. Airlines use common-use or shared IT infrastructure at airports around the world, and this groundbreaking solution has been developed by SITA to support airlines that wish to accept payments at common-use checkin desks, kiosks, and bagdrop areas for baggage fees, upgrades, and other ancillary charges. SITA’s new solution uniquely combines point-to-
point encryption (P2PE) technology, with Europay, Mastercard, Visa (EMV) and Payment Card Industry (PCI) compliant chip card payment terminals, applications and processes, to allow multiple merchants to use the same terminal while meeting PCI security standards. A new world of mixed reality is now emerging, and SITA Lab, the research arm of air transport IT provider SITA, is exploring its potential for airlines and airports. It has now released early results of research carried out with Helsinki Airport, using Microsoft HoloLens to analyse and manage airport operations in a mixed reality environment. HoloLens is the world’s first self-contained holographic computer, enabling users to engage with digital content and interact with holograms in the world around them. It runs Windows 10, and
enables the blending of the physical and digital worlds in ways that were previously impossible. SITA worked with Helsinki Airport to use HoloLens to reproduce the airport operational control centre (AOCC) in this mixed reality environment. This new way of looking at the world can provide new insights into how the airport is functioning. HoloLens also opens the possibility of being able to access the AOCC environment from any location, on or offsite, allowing experts to provide input to situations remotely. While the technology shows potential, SITA Lab points out it is early days, and before enterprise use at airports, issues of weight, size, and durability will need to be addressed. Users must also learn how to interact in this new environment to maximise its benefits.
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During Invest in Sharjah’s participation at the 2017 World Forum for Foreign Direct Investment in Shanghai During Invest in Sharjah’s participation at the 2017 World Forum for Foreign Direct Investment in Shanghai
A new era of Sharjah - China investment possibilities forged As part of its ever-increasing drive to attract more foreign business into the UAE, the Sharjah FDI Office (Invest in Sharjah), the promotional arm of the Sharjah Investment and Development Authority (Shurooq), has reinforced the emirate’s investment advantages at major global events in China’s two fastest growing cities. Participating at the 2017 World Forum for Foreign Direct Investment in Shanghai, the centre of the country’s business, finance, information and culture, and at the China
Offshore Summit in Shenzhen, China’s fastest developing city in terms of investment activities, innovation capability, and technology exchange, Invest in Sharjah showcased the benefits and incentives of investing in the UAE in general, and Sharjah in particular, providing insights and investment opportunities through its ‘Invest in Sharjah’ stand. The delegation included Yonghui Ma, Investment Promotion Manager at Invest in Sharjah, and Saif Al Suwaidi, Investment Promotion Manager at Invest in Sharjah.
During Invest in Sharjah’s participation at the 2017 World Forum for Foreign Direct Investment in Shanghai
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The delegation described the events in both Shanghai and Shenzhen as ideal opportunities to continue investment momentum for the UAE, with estimates for last year’s bilateral trade with China as high as US$ 60 billion (AED 220380000000). They pointed to the fact that there are approximately 4,200 Chinese companies operating in the country, including China State Construction, China National Petroleum, HUAWEI, Bank of China, ICBC, China COSCO Shipping, and many more.
Yonghui Ma and Saif Al Suwaidi at the 2017 World Forum for Foreign Direct Investment in Shanghai
Abu Dhabi Airports marches steadily towards excellence Following the completion of its own internal excellence awards last month, Abu Dhabi Airports is now finalising its submission for the 2017 cycle of the Abu Dhabi Awards for Excellence in Government Performance, launched by H H Sheikh Khalifa bin Zayed Al Nahyan, President of the UAE, in 2007, and under the patronage of His Highness General Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces. Abu Dhabi Airports identified excellence focus groups and champions to lead the award exercise, and has been supporting them by organising a series of workshops to finalise submissions for all relevant award categories. The programme has seen tremendous support from the executive management, who recognise the value of such awards in highlighting good performance. The objectives of the Abu Dhabi Awards for Excellence in Government Performance are to inspire organisations to improve their performance, practices, and capabilities based on a proven model of excellence, and in doing so, deliver better value to government customers and stakeholders.
Emirates maps future airport experience with key partners Emirates has launched its ‘Together’ initiative, in collaboration with key partners: Dubai Customs, Dubai General Directorate of Residency and Foreigners Affairs (GDRFA), Dubai Police, and Dubai Airports. The initiative aims to improve traveller experience at the airline’s Dubai International airport hub, focusing on innovative and practical solutions that will be based on the ‘6s’ - Smart, Speed, Saving, Service, Safety, and Security. Using a collaborative and actionoriented approach, the team comprising of senior representatives from each partner organisation will conduct a series of workshops to agree priorities and a working plan, geared towards incremental implementation in four-week sprints. In
parallel, the working group will also look at goal posts further into the future, in line with Dubai’s 10X programme to generate innovations that will put the city 10 years ahead of other global cities. Meanwhile, Emirates SkyCargo has played a key role in strengthening trade links in perishables between Vietnam and the UAE. Over the last year, the carrier has facilitated a near five-fold increase in the volumes of exports of fruits, including rambutans and lychees from Vietnam to Dubai. As a result of the collaborative efforts between Emirates SkyCargo and Vietrade, the volume of perishables exports from Vietnam to Dubai has increased considerably touching a record of close to 110 tonnes in January 2017.
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EMC provides 50 Mercedes-Benz Trucks to Readymix Firm Emirates Motor Company (EMC) Daimler Commercial Vehicles has delivered 50 Mercedes-Benz Actros trucks to Transgulf Readymix that will help the UAE concrete firm fulfil on its growing list of contracts. EMC officially handed the fleet of trucks over to the Abu Dhabi-based firm in what is
believed to be one of the largest deals of its kind in the UAE. Transgulf are one of the region’s largest ready mix firms and the 50 Actros 4440 8x4 vehicles represent a vital cog that will allow the firm to deliver to its clients as it continues to expand.
Agility signs three-year logistics deal with Porsche The Kuwait-based logistics service provider has signed a three-year partnership agreement with Porsche Motorsports for the Porsche Carrera Cup Deutschland (PCCD) racing series. The partnership is a marquee operation for Agility, which works with automotive customers on a spectrum of automotive industry projects. “This partnership with the PCCD gives us an opportunity to demonstrate our understanding of the special demands of automotive logistics, and our ability to deliver under the pressure of race conditions,”said Essa AlSaleh, CEO of Agility Global Integrated Logistics. On the air cargo side, Agility registered globally significant numbers, placing well within the largest global forwarders category. Source: Lewis King, www.aircargoworld.com
GENAVCO participates in Automechanika – Dubai General Navigation and Commerce Company LLC (GENAVCO), member of Juma Al Majid Group, participated in Automechanika, which was held in Dubai last month. It was a great moment for the company that also celebrated its 50th year anniversary. Neeraj Mahajan, the new Director of GENAVCO, along with the key principals, inaugurated the stand with
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a grand ribbon cutting ceremony. He strongly believes that Dubai will remain to be the leader in logistics and supply chain hub of this region. GENAVCO Spare Parts, the biggest section of the Trade Fair, showcased their main product, ISUZU, alongside other brands like MTU, Detroit Diesel, John Deere, Alison Transmission, Writgen, Crown, JLG, &Liebherr.
From lef: Philipose Jacob, regional general manager, Honeywell Building Solutions (HBS); Datta Godbole, vice president and chief technical officer, HBS; Deborah Learoyd, Global Leader Connected Operations, HBS; Dina Tamimi, Smart Cities Leader and John Boothroyd, Global Service Marketing Director, Connected Services, HBS at an invitation-only OBS event hosted in Dubai earlier this month Norm Gilsdorf, Honeywell President, Middle East, Russia, Turkey & Central Asia addressing audience at OBS event in Dubai
Honeywell’s launches connected freight technology and cloud-enabled building management service Honeywell has announced a new Connected Freight solution that gives shippers and logistics companies unprecedented ability to monitor shipments of high-value and perishable goods, helping prevent costly damage and loss. The new solution, developed in collaboration with Intel and thirdparty logistics companies, provides real-time information about the location and condition of critical freight while in transit. Real-time shipment information is critical, for example, when shipping perishables and goods that require uninterrupted refrigeration, such as pharmaceuticals, or Indicators truck high-value equipment that is sensitive to vibration or shock. Honeywell’s Connected Freight solution consists of costeffective sensor tags that sense a range of environmental conditions, such as temperature or vibration. The tags can be affixed to pallets or individual packages. Honeywell developed the technology with Intel and three prominent third-party logistics companies: DHL, Expeditors, and Kuehne + Nagel. As a technology partner and ongoing supporter of the Middle East’s smart building and smart city ambitions, Honeywell has also introduced Outcome Based Service, a new cloud-enabled building management service aimed at making the region’s facilities greener, safer, and more productive. The service helps prioritise building maintenance activities where they can have the most impact on overall building performance. Combining advanced automation and data analytics, Outcome Based Service enables Honeywell service engineers to assess and scrutinise building assets around the clock, promoting the identification of anomalies and misconfigurations earlier than traditional maintenance, and helping save time and money. By leveraging the Internet of Things (IoT) the cloud-based service will continue supporting the development of smarter buildings. Results from early pilot deployments have shown it can help organisations cut energy spend while cutting reactive Stakeholders interacting at Honeywell OBS event in Dubai service calls.
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Dubai Internet City affirms role as enabling platform for entrepreneurs and SMEs
Some of the UAE’s leading business and technology experts discussed the secrets of successful entrepreneurship, with a focus on how best to harness business opportunities, at the 20th edition of TECOM SME Builder, organised by Dubai Internet City (DIC. The event is just one example of how DIC has successfully established itself as a strong platform and enabler of SMEs and start-ups in the Gulf and beyond. Launched by the TECOM Group in 2007, TECOM SME Builder has been a highly successful event series, consisting of two to three annual events organised specifically to serve its 11 business communities in Dubai that offer home to over 5,100 companies and a total workforce of 76,000. Created on the back of positive forecasts that outlined the important role of the SME sector in the growth of the UAE’s economy, the event
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enables small business owners to open a dialogue with and build a network of experts and consultants in different operational aspects of the industry. Held last month at the Arjaan Rotana in Dubai Media City, the morning saw presentations on ‘Innovation Funding: How to get it right’ by Martin Roussel, Managing Director of the Mohammed bin Rashid Innovation Fund (MBRIF) and ‘Dubai SME Rating Framework (RATE)’ by Salama Al Falasi, Principal Executive in the Strategy and Policy department at Dubai SME, a government agency focused on developing entrepreneurship and Small & Medium Enterprises (SMEs) in the Emirate. The event also featured speed table sessions for one-to-one expert consultations, and offered an opportunity for attendees to network with inspiring innovators, thought leaders, and peers.
MBRSC’s Sustainable Autonomous House wins the 2017 MENA Green Building Award The Mohammed bin Rashid Space Centre (MBRSC) Sustainable Autonomous House, the first of its kind Passive House for a hot and humid climate, won the 2017 MENA Green Building Award under the category Green Residential Building. The awards attracted a large number of submissions from many institutions, companies, research centres and students from six countries from the Middle East and North Africa (MENA) region for different categories focusing on sustainability practices. The event was organised by the Emirates Green Building Council (EmiratesGBC), in partnership with the JordanGBC and LebanonGBC, and supported by the World Green Building Council. H.E.Yousuf Al Shaibani, Director General of MBRSC said: “The award affirms the Centre’s success in launching innovative and integrated projects that provide a typical living environment to humans, adopting to sustainability standards”.
Cathay Pacific reorganises head office as first step in transformation plan Cathay Pacific announced that it will be making around 600 people redundant in its head office. This is part of a transformation programme to make Cathay Pacific and Cathay Dragon more effective by improving the speed and quality of decision-making, and putting a greater focus on its customers. The changes will affect senior, middle management, and nonmanagerial roles at the Group’s headquarters in Hong Kong. Around 190 management and 400 non-managerial roles will go, representing 25 per cent of management, and 18 per cent of non-managerial positions respectively. The majority of affected employees will be informed of changes or a cessation to their role today and over the next month, with most of the restructuring completed by the end of 2017. To align with the head office reorganisation, Cathay Pacific will also restructure its Cargo department.
SAP unveils live business and expands Google partnership at SAPPHIRE NOW SAP SE announced it has harnessed its digital core, bold technologies of the future, and its expertise in ERP, to help customers make everything digital, programmable, smarter. SAP’s commitment to an open ecosystem and strong partnerships will be key for the cloud-based intelligent enterprise, seen as a cornerstone for the new global economy. The expanded SAP Leonardo brings together differentiating software capabilities in machine learning, the Internet of Things
(IoT), Big Data, analytics, and blockchain on SAP Cloud Platform, together with SAP experience, deep process and industry knowledge, and advanced design thinking methodology. The SAP and Google strategic coinnovation partnership, announced in March, now includes additional certification of SAP technology and applications on Google Cloud Platform (GCP). The partnership also aims to make SAP Cloud Platform on GCP available globally, as well as future collaboration and integrations in machine learning, the IoT, data transparency and custodian services, and workplace productivity. Google and SAP plan to accelerate customers’ digital business transformation through intelligent applications such as conversational apps that guide users through complex workflows and transactions and answer questions around their enterprise.
InfoFort becomes first in UAE to rebrand with ‘Dubai Font’ InfoFort has unveiled a new logo designed using the recently launched ‘Dubai’ typeface. In homage to the emirate’s vision to become a leader in innovation and smart technology, InfoFort announced that it has also adopted the ‘Dubai Font’ for use across its entire internal and external
communications materials. The re-branding and adoption of the new logo also reveals InfoFort’s pioneering spirit that is central to its vision and based on three main pillars: Data; Technology; and Analytics. The font, created by The Executive Council of Dubai, in collaboration with
Microsoft, was officially introduced to the public on April 30th by the Crown Prince of Dubai, His Highness Sheikh Hamdan bin Mohammed Al Maktoum.
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Al-Futtaim Motors inaugurates its very first Toyota Material Handling 3S facility in the UAE Al-Futtaim Motors opened the doors to its very first standalone 3S Toyota Material Handling facility in Umm Ramool, Dubai (sales, service and spare parts). The fully integrated ASEC certified 3S facility offers
customers a much more convenient and efficient journey than ever before, with a dedicated service area that includes 18 simultaneous working bays. Additionally, an automated vehicle in the
form of a mobile robot that follows markers or wires on the floor, while using lasers for navigation, is utilised in the facility, in order to create fast synergy and increase uptime between the parts counter and service technicians, ensuring faster services and heightened efficiency and productivity. The new Toyota Material Handling 3S facility is located in Umm Ramool next to the Lexus body shop, and will open five days a week, from 8.00 am to 5.00 pm.
Majid Al Futtaim celebrates big wins at the MENA Green Building Awards 2017 Majid Al Futtaim celebrated big wins at the fifth annual 2017 MENA Green Building Awards. Supported by the WorldGBC, and organised in partnership with the JordanGBC and LebanonGBC; the MENA Green Building Awards 2017 saw two accolades awarded to Majid Al Futtaim. Majid Al Futtaim was recognised as ‘Developer of the Year’, underpinning the company’s achievements and ongoing commitment to sustainable development
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and green building practices. Earlier this year, Majid Al Futtaim launched their Net Positive strategy that aims to significantly reduce the company’s water consumption and carbon emissions, to the extent that it puts more back into the environment than it takes out, resulting in a positive corporate footprint by 2040. In addition, Majid Al Futtaim also took home the award for ‘Green Hotel of the Year’ for the Hilton Garden Inn Dubai, Mall of the Emirates, the second
largest Hilton Garden Inn in the world, and the largest outside of America. The hotel, a LEED Gold project with the highest LEED certification points achieved for any hotel property in the UAE, was designed, constructed, and opened for business as planned in an impressive 18 months. All aspects of the project - from design to development and construction were underpinned by sustainability - from locally produced, recyclable building materials, and use of solar thermal collectors for hot water; to best management practices in dust control, noise pollution to uphold quality, and ensure the highest health, safety and sustainability standards. Majid Al Futtaim has reduced energy consumption by nine per cent across the 12 hotels in its portfolio. It expects to save a further AED three million (US$ 816771) by installing LED lighting at the 21 shopping malls that it manages across the region.
UAE tile market to grow 12 per cent by 2020 The UAE’s continued construction boom ahead of Expo 2020 has driven demand for ceramic tiles to increase by almost 70 per cent, and, with almost 40 per cent of tiles imported from overseas, this poses huge opportunities for international manufacturers to win contracts on prestigious UAE projects. As the largest exporter of tiles to the UAE, India is well positioned to build on its already strong business ties with the country, and, between November 14th and 19th, 2017, buyers from the UAE will have the chance to visit the second largest manufacturer of tiles in the world at the Vibrant Ceramics Expo and Summit 2017. An initiative of Prime Minister of India, Narendra Modi, the exhibition will be held in Gandhinagar, Ahmedabad, Gujarat, India with business leaders
from the booming local ceramic industry welcoming a delegation of buyers from the UAE. The hosted programme will offer three nights’ accommodation, meals, local transportation, and a helicopter tour of the factory for international delegates. This event is being organised in association with the Morbi Ceramics Associations. Spread over 50,000 square metres, it will host more than 250 exhibitors, 400+ brands, and thousands of sizes and designs under one roof.
Solutions for a healthy world Tranzone operates a state-of-the-art 3PL warehouse in Jebel Ali Free Zone. We have partnerships with the leading pharmaceutical, medical device and animal health companies around the world.
Healthcare Logistic Services: Air Freight Sea Freight Land Transportation Value Added Services Warehousing & Distribution Return logistics Documentation Tranzone FZCO (Member of Banaja Holdings)
Jebel Ali Free Zone (South) Plot No: S20129 P.O Box : 262955, Dubai, United Arab Emirates, Tel : +971 4 811 0000
Web: www.tranzone.ae JUNE 2017 15
COUNTRY REPORT - KINGDOM OF SAUDI ARABIA
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COUNTRY REPORT - KINGDOM OF SAUDI ARABIA
Big changes ahead for Saudi Arabia’s health care sector
Rising consumer demand and an increased role for the private sector look set to drive expansion and open new doors for investors in Saudi Arabia’s health care industry. Oxford Business Group reports on the healthcare and insurance industries in the Kingdom
I
n its “2016 Global Medical Trend Rates”report, US-based consultancy Aon Hewitt predicts the Kingdom’s health care sector will grow at a compound annual growth rate of 12.3 per cent through to 2020, reaching a value of US$71.2bn. Last year the average net“trend rate”for the industry in Saudi Arabia rose by 9.5 per cent, according to Aon, well above the MENA average of 5.3 per cent. A strategy report released in December by Saudi brokerage firm Al Rajhi Capital likewise says that improved liquidity and a government commitment to expand the private sector’s role in the economy should see higher levels of investment in health care in the coming year. “The health care sector in Saudi Arabia can count on the right enabling environment and resources to start
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enacting key reforms to the entire sector’s model,”Dr Haitham Alfalah, CEO of King Saud Medical City, told OBG.
In the pipeline According to a report issued in December by Dubai-based investment management firm Al Masah Capital, out of roughly 150 major health care infrastructure projects listed for completion by 2021 across the GCC, some 87 are located in Saudi Arabia, accounting for some 47 per cent of the regional total of US$42bn. Among these projects are plans to build several“medical cities”in the Kingdom at a total cost of US$4.3bn. The largest will be the US$1.2bn King Abdullah Medical City in Dammam, which will span more than 700,000 sq metres and house a 1500-bed facility. A second, the US$1bn King Abdullah Medical City in Makkah Province, will contain three hospitals and 10 medical centres, with a total of 1500 beds, while a third, the US$1.1bn King Faisal Medical City in Abha in the south, is to open in 2021 and include a 500-bed main hospital alongside five specialty hospitals, for a total bed count of 1350.
Healthy vision
Sunset over Riyadh downtown, Saudi Arabia.
These projects are part of Vision 2030, the government’s long-term blueprint for economic and social development, which – alongside the accompanying mediumterm plan, the National Transformation Program (NTP) launched last year – calls for a major overhaul of the health sector in the coming years. Among the measures outlined to achieve this will be improved access to health facilities and greater transparency through increased adoption of technology. According to the plan, 70 per cent of the Saudi population will have a unified digital medical record by 2020. Vision 2030 is backed by significant fiscal resources. Out of total allocations of SR890bn (US$237.3bn) in the 2017 budget, released at the end of last year, health and “social development”account for SR120bn (US$32bn), an increase of 15 per cent on the previous year. Much of this spending is aimed at boosting infrastructure, including plans for 38 new health centres with a total of 9100 hospital beds. This comes on top of 23 new hospitals and 4250 beds that were added last year. The plan also calls for a shift in the state’s role in the sector. Though it will maintain
some degree of involvement in providing health services, in future the public sector will focus more on planning, regulatory and supervisory functions. Under the blueprint, the private sector share in the health care industry is forecast to rise by 10 percentage points to 35 per cent by 2020, pushing total revenue generated by the private sector up from a baseline of SR300m (US$80m) to reach SR4bn (US$1bn).
Taking the sector’s pulse A fast-growing population and high incidence of lifestyle-related illnesses such as diabetes and obesity in the Kingdom are expected to be the main drivers of new demand for quality health care in the medium to long term. “The health care market is so big that there is great room for it to accommodate several other private sector players before it becomes saturated,”Osman Minkara, managing director of Aldara Hospital and Medical Centre, told OBG. The Kingdom’s sizeable health care sector has proved resilient in the wake of the global economic downturn, and opportunities in niche segments are growing, according to Riyadh Bajodah, CEO of health care IT solutions provider Waseel. “Health care will always be in demand independently from the broader economic picture,”he told OBG.“IT systems for health insurance claims are even less volatile given that their demand is based on the number of insured people rather than the size of transactions. The former can only increase as the public becomes more aware of the benefits of insurance.”
Compulsory insurance lines to underpin sector growth in Saudi Arabia A government push to enforce stronger uptake of compulsory health and automotive coverage could generate substantial new business in Saudi Arabia’s insurance sector, deepening the industry’s premium pool and strengthening its asset base. On April 10 the fourth phase in a yearlong legal effort to boost compliance came into effect, requiring all companies with less than 25 employees to join larger firms in providing health insurance for their staff. The“unified health insurance policy”was approved by Cabinet decision on April 14,
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COUNTRY REPORT - KINGDOM OF SAUDI ARABIA
2016 and carried out in four stages by the Council of Cooperative Health Insurance, a state agency. Three previous phases mandated full compliance with health insurance laws under varying grace periods – three, six and nine months, respectively, for firms with 100-plus, 50-99 and 25-49 employees – according to global law firm Clyde & Co. Since passing the Cooperative Insurance Law in 2006, the Kingdom has transformed its insurance sector from a largely unregulated industry into what is now the GCC’s largest market for non-life and health insurance, according to a February report by S&P Global, the research arm of ratings agency Standard & Poor’s. While growth in gross written premiums was modest last year, rising 0.5 per cent to SR35.8bn (US$9.55bn), net income increased by 139 per cent to SR2.5bn (US$670m).
Aerial view of Riyadh downtown, Saudi Arabia.
Market in waiting The potential market from a further rise in compliance could be significant in the long term. According to official estimates, some 2.5m Saudi nationals working in the private sector do not have employer-provided health insurance as required by law. Local media reports suggest the same may be true for another 870,000 foreign workers and their dependents. Taken together, these groups represent more than 10 per cent of the Kingdom’s population of 31.5m. Similar potential exists in the automotive segment: S&P Global estimates more than half of all vehicles in the Kingdom are uninsured, in breach of the law. Efforts to boost enforcement in both these areas of coverage should spur growth in the sector, according to David Anthony, lead credit analyst at S&P Global. “The Saudi insurance market is likely to see only modest growth at best in 2017, largely fuelled by the authorities’ pursuit of motorists and employers that have so far not taken out the cover required under Saudi law,”Anthony told media last month. According to the most recent figures from reinsurance firm Swiss Re, Saudi Arabia’s insurance penetration stood at 1.51 per cent in 2015, well below Bahrain’s 2.5 per cent and the UAE’s 2.4 per cent. This underscores
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vast long-term potential in what is the GCC’s largest economy, with a GDP of US$639.6bn in 2016, according to the IMF. Beyond health and motor insurance, a further segment that could see higher levels of activity in the future is homeowner’s insurance, thanks to moves by financial sector regulator Saudi Arabian Monetary Authority to boost access to mortgages. In January the agency announced it was raising the ceiling on loan-to-value ratios for first mortgages from 70 per cent to 85 per cent of the listed property price – a move it hopes will bring new buyers into the market and could drive fresh demand for property insurance.
Crowded field Any gains on the horizon for the sector may, however, be spread thinly, particularly among second-tier firms seeking to compete with larger ones – there are more than 30 insurers operating in the domestic market, a number many analysts consider too high.
This congestion, while a positive for consumers able to benefit from pricing competition, also means many firms have very narrow margins. Some companies are therefore reportedly looking to strengthen their positions through mergers or acquisitions, as has happened in the banking industry. One recent move towards consolidation occurred in early March, when Gulf Union announced it was in early talks with fellow domestic insurer Al Ahlia about a potential merger. According to a company statement, the two parties hope to negotiate a preliminary agreement over the next 12 months. In a report released that same month, ratings agency Moody’s said much of the sector’s business is concentrated at the top end, both in Saudi Arabia and across the GCC. It suggested this could impact profitability among smaller firms and increase their exposure to risk as they try to compete with stronger, better-capitalised rivals. -www.oxfordbusinessgroup.com
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COVER
The all important human resource Munawar Shariff speaks with leaders from the logistics and supply chain sector about the people factor in successful business, about how best to utilise the human resource in the ebb and flow of their respective industries 22 MAY 2017
COVER
Facilities management Rafael Sanjurjo Lopez, Regional General Manager - GCC, Blue
There is a huge demand in facilities management and waste management today. Driven by Dubai’s ambitious Waste Management Master Plan 2030, which aims at attaining 75 per cent waste diversion from landfills by 2021, companies are looking for sustainable and smart ways to reduce and dispose of their waste.“And this what we do at Blue, providing sustainable solution for a greener and cleaner future,”says Rafael Sanjurjo Lopez, Regional General Manager GCC, Blue - Facilities Management. Part of the Alserkal Group, and in the market since the last 25 years, Blue has the backing and reputation to face market challenges head on.“Moreover, our strategy to offer a comprehensive range of innovative solutions to our clients has helped us to become one of the industry leaders. Today, Blue is a key partner in both Facility Management and Waste Management industry,”says Lopez. This success can be attributed to the team at Blue. Lopez believes in the potential of each employee.“We have created an international team of experts, fitting into the cultural melting pot of the country. Our team is rich with 30 different nationalities, coming from diverse backgrounds and bringing their expertise, which largely contributes to our success,”he states.
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COVER
our training and development programme, Diversity, adaptability, leadership, and employees get a minimum of two days teamwork – these are the main qualities training per year,”he elaborates. Lopez looks for in potential candidates. “In today’s world, if you want to be Professionals who work well with clients successful your leadership style has to are ideal.“Dubai’s market is very unique, as constantly adjust. Adjust to the situation, to it offers highly-educated candidates from the culture, and even to each all over the world, with business unit, division, role, diverse culture and professional exposure. Such innovation has and staff member within the organisation. Blue was created This is exactly the type of become essential in with the desire to foster candidate we are aiming develop new ideas, at attracting here at Blue,” tracking services and change, new roles and vision. Change he says. comes with challenges, and From then on, Blue improving supply requires making a clear takes the training and chain management. path for our employees to career development understand our vision and route.“We value their It builds closer goals,”he explains. skills development as relationships For Lopez, delegation is a way for the company key to empower the team, to build the necessary between thirdgiving them the opportunity to foundation for its party providers shine and grow. His objective business growth. To meet is to get employees with a the market changing and customers strong sense of ownership, demands, we ensure that and increases the able to make their own our employees have the right set of skills to adapt efficiency of service decisions, yet, work towards their common goals.“As the while growing within the delivery. regional general manager, my organisation. Through
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role is to provide my team with the tools and guidance they need to grow,”he says, adding,“This comes in handy during times of crisis as we need to stay level-headed and focus. The main responsibility of a manager is to ensure his team always keeps its priority, whatever challenges the company is facing. Communication and messaging are also important to deal with unforeseen crisis situations. The major mistake made by companies is to try to respond to the immediate consequences of the crisis, and therefore often lose sight of the need to fix the underlying problem. Crisis need to be analysed to be addressed with the correct plan. As part of our standard operating procedure, we have plans to face certain type of crisis. If not, we have to consult others and seek advice. Lastly, we have to learn from it so we can avoid it in the future.” Through the Waste Management Master Plan 2030, the country is encouraging the development of an integrated and innovative approach to waste management. A lot of new projects are under plan, which will help the country and the region to be at the forefront of the industry, which is good news for the industry as a whole.
COVER
Sean Bradley, Managing Director Freightworks
Logistics
When it comes to oil and gas related work, Sean Bradley, Managing Director Freightworks, believes growth will remain static. The good news is that he thinks the construction, hospitality, and tourism sectors will begin to improve in the short term. “The aviation supply chain is a key focus for us, and even though the industry is going through a difficult time, we are seeing continued investment. The relationship we have with the Emirates Group has been developed over 18 years - we are regarded as partners and follow a specific performance matrix. We receive very positive feedback from the group so this has been a good area for Freightworks in 2017,”he says. Ocean freight in general has been hard for some time. Following Hanjin’s collapse, the subsequent empty space generated didn’t stay so for long, gobbled up by one of the Alliance partners, who continue to grow stronger as seen with the recent Hamburg Sud acquisition. Airfreight imports, exports, and
transhipments remain steady, he says, even though pricing in some sectors is being affected by integrator freighter pricing driving the 100+ kilogramme market down. “Supply chain development in Dubai looks strong. Panalpina has moved into new premises recently, and Mohebi and GAC have developed new logistics centres, some to specifically cater to one client. E-commerce is doing very well, and developing rapidly within the region. Credit card proliferation will increase, driving the business forward exponentially. Last mile service providers are in for an interesting time with Amazon entering the region,”he smiles. As the arrival of VAT attracts attention, it also requires a lot of preparation, as its full application and impact is not yet fully understood.“It will be interesting to see how the payment and recovery systems for goods entering and transiting the country and region develop over the remainder of 2017. From our perspective, we are taking every step possible to ensure that we are at the forefront of these developments,”says Bradley.
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COVER
One of these steps include making changes to the business, big and small, all with the aim of improving their service offering.“Continuous improvement methodology is applied to everything, along with building a robust HR framework, applying LEAN, Town Hall, open communication, and integrating the company into one team,”he says, adding, “The whole team, from grade one to 10, is absolutely integral to making the company a success.” To ensure the team is right for the job, Bradley is involved in the recruitment of every person that eventually joins the company.“We do not use external agencies for recruitment as we are already part of two fantastic companies - the Kanoo and Emirates Groups - and through these, as well as our own networks, we have access to a plethora of possible applicants,”he explains, continuing,“When it comes to finding the right person, I look for someone with a ‘get up and go’ attitude, who is self-disciplined, presentable, well-spoken, and thrives in a team environment, someone who will go that extra mile for a colleague.” In the UAE, Bradley finds the calibre of individuals in the market varies greatly, as does the 4000+ registered number of companies in the industry.“Needless to say,
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very good people are difficult to find, so we spend time, effort, and money developing our own staff through validated internal programmes and succession planning systems,”he says, adding,“We invest in our employees to ensure they are the best in the business. In addition, we are sensitive to the need to be the best we can in the fields we operate in. We take safety, ethics, and compliance extremely seriously, so that we hit the highest possible global standards, ensuring that these mechanisms are audited by third party accredited specialists.” When it comes to leadership, Bradley takes a straightforward approach, never short of encouragement or ideas, and will go the extra mile for his team and the company every day. He keeps an open-door policy, which comes in handy when dealing with crisis situations. “If it involves a client, I will get involved personally and ensure the client is informed straight away. At the same time, I will work with my team to discuss service recovery options and seek an immediate resolution. I’m very hands-on, so will stay involved throughout the process, which includes being open, discussing the facts, both good and bad, ensuring the client knows you are there to resolve the issue, explaining clearly what your plan of action is, keeping them informed all the way through the process, and ensuring
While financial capital and other assets, such as transport and technology, provide the facilities for the company to best serve our clients, a good working relationship with our team is always the one that brings successful results. contact is made when promised, and resolving the situation as soon as possible, while accepting responsibility if it is the fault of the business. This means you continue to develop a longer-term relationship with the client,”he states. And when it comes to the long-term, Bradley is confident of where the company is going –“Just like Uber has done with taxis, and Air BnB has done with accommodation, we will no doubt encounter changes in the industry: drone deliveries, C2C, pack station developments, changes in the laws within the postal sector, VAT and taxes, and geopolitical landscape changes are all likely to have an impact. But one thing for sure - that nothing is going to get delivered without us!”
COVER
Mark Geilenkirchen, CEO, SOHAR Port and Freezone
Oman is gearing up to take full advantage of its favourable geographic location by investing heavily in infrastructure and Sohar Port and Freezone, located outside the Strait of Hormuz, is at the centre of its plans. In 2016, the logistical hub handled over one million tonnes of cargo each week for the first time. The new Hutchison-operated container terminal uses remote-controlled quayside cranes, ready for next generation 20,000 TEU container vessels. Recently installed Auto Gates and an online truck appointment
system have reduced paperwork and dramatically improved turnaround times. Sohar Port and Freezone CEO, Mark Geilenkirchen, knows that time is money in the world of global logistics:“Ports don’t look very smart seen from outside the fence, but over the past ten years there has been a revolution in the way that we work. Behind the scenes, there has been huge investment and innovation. Today, Sohar is one of the world’s fastest growing port and free zone developments. Investments at Sohar reached a staggering US$26 billion last year, which is more than the GDP of some smaller European countries.”
Logistics
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Dutch-born, but with broad global business experience, the Sohar CEO knows that the focus of port operators is changing across the globe. Instead of being really good at doing just one particular thing, today it’s more important that they become really good at learning how to do new things - and doing that faster and better than ever before.“Right now, that’s our focus at Sohar, and ensuring that we have the people and management structures in place to deliver,”explains Geilenkirchen. “Underestimating uncertainty can lead to corporate strategies that on one hand don’t defend the company against threats, and on the other don’t take full advantage of the many opportunities that higher levels of uncertainty can bring us,”he says. Sohar Innovation Zone is central to this effort. The Port and Freezone wants to operate their new Innovation Zone as an ideas factory. Working in close cooperation with the Port of Rotterdam, it will try to find innovative ways to solve tomorrow’s logistical
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problems.“Together with private sector companies, international research institutes and some of the world’s top universities, we are seeking solutions across a broad range of issues that affect our shipping, logistics and industrial hub at Sohar Port and Freezone,” says Geilenkirchen. Sohar Innovation Zone will focus on sustainability, it will not be connected to the national power grid, instead getting all its electricity needs from renewable sources, while all waste will be recycled. The Innovation Zone is not a hypothetical, futuristic concept, however. It will use proven and trustworthy techniques brought together
in one integrated system for the first time, to demonstrate the full potential of Oman’s technology sector. All of these efforts are helping to increase efficiency, making the port smarter through innovation. Mark Geilenkirchen knows that finding qualified staff in the Middle East for developments like these is never easy. I asked him how he chooses who to hire:“Faced with equally qualified job candidates, I would always pick the one who is more self-critical, because I think they understand better what it’s like to work in an entrepreneurial climate. I might ask them to give me examples of things that they struggle with, or to tell me three mistakes that they made in their last job. The answers to those questions reveal a great deal about underlying personality traits.”And the CEO’s advice to a young Omani, entering a leadership position for the first time?“Listen carefully to people, don’t presume, stay humble, empower others – when they shine, you shine too, and when they mess up, it will be you that’s on the line.”
COVER
Logistics Mustapha Kawam, President and CEO, Globe Express Services
The Middle East is rapidly catching up with technological innovations in the logistics and supply chain industry, where communication and real-time information is as crucial as the goods being delivered. The availability of information to customers is essential for growth in this part of the region, and the competition is high when it
comes to providing premium value through information technology, particularly on the use of cloud computing and mobile communications. “Such innovation has become essential in tracking services and improving supply chain management. It builds closer relationships between third-party providers and customers and increases the efficiency of service delivery. Recent surveys have shown that
53 per cent of companies in the region are satisfied with their third-party providers’ capabilities,”shares Mustapha Kawam, President and CEO, Globe Express Services. GES attributes its growth to constant efforts to improve their services, which has become part of the company’s DNA.“Our strategy is simple, and based on four main goals: inspired employees, excellent services, trusted by customers, and a rewarding business network. For each of these goals, we implement specific initiatives and projects, and make sure they are achieved. For example, in motivating our team, we have employee engagement and recognition, as well as training and career progression programmes. For providing great services, some of the things we do include checking that things are done the right way, listening to our customers, and improving delivery speed, among others,”he explains. When it comes to the team, Kawam places great importance and confidence in his.“The
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The major mistake made by companies is to try to respond to the immediate consequences of the crisis, and therefore often lose sight of the need to fix the underlying problem
team is the core that makes the company move, based on the set goals. Without the right combination of staff to work on the targets we have set, nothing will materialise. Our company is based on people, and so they are our best assets. Investing in their growth is essentially investing in the company’s future. While financial capital and other assets such as transport and technology provide the facilities for the company to best serve our clients, a good working relationship with our team is always the one that brings successful results. We could have the top-level tracking systems or a heavy-duty transport, but in the end, a smart and dedicated staff can only make the difference to our customers,”he smiles. When recruiting staff, attitude towards work and colleagues is top priority for Kawam, because there is no value in looking at the potential benefits of someone with demonstrable skills, but with an attitude that does not fit the company values. The candidate may bring in monetary rewards temporarily, but the consequent disruptions from a wrong attitude are not worth it. “Someone who has the right attitude, but insufficient skill has better chances of helping the company grow as he or she can be trained,” he says, adding,“The UAE provides
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a wide array of candidates, given the diversity of nationalities in the country, and thus presents a good opportunity to develop a multicultural team that complements each other in terms of skills and values. It can sometimes be a challenge, but the benefits are higher as the network is also bigger.” GES is a strong believer in employee training, and it is one of the activities done throughout the year. Kawam considers it a necessity, and not a luxury. “Every year, we have a scheduled outsourced training programme for the whole team, as well as an in-house programme mainly for the operations and sales team. A yearly workshop is also being held to encourage staff, and bring new ideas to help improve the business. Logistics is a complex business, and to be able to deliver the best and most competitive solutions, we need highlytrained staff to be at the frontline of every aspect of our operations,”he muses. Kawam believes in inspiring loyalty and respect, rather than fear.“I always believe that to be able to lead and earn respect from my team members, it is important to empower and motivate them well, so that there is zeal and enthusiasm in their work. When employees are motivated, they become
creative and contribute better ideas on how to improve a task. I think to be a leader is to provide an environment for the staff to grow and consider the office as a great place to work,”he states, adding,“Leading the team to align their work according to our vision and mission, and knowing where they could excel and be most productive is very important, because when they know what to do, they can be empowered and they can play an active role in decision-making.”
COVER
A great team can be most beneficial when dealing with unforeseen crisis situations, but Kawam takes it in his stride.“There are always threats that we often think to be unforeseen, simply because we never consider them to be cause for concern. Threats to the business are always around – natural disasters such as earthquakes and hurricanes; labour disputes; geopolitical unrest, changes in trade regulations, and environmental risks to supply, among others.
It is not only our business that gets affected, as these threats of supply chain disruptions can impact the bottom lines, market position, and stock value of other companies at the end of the chain,”he shares. However, he believes that paying close attention, and staying alert on events that may have an impact on the business, makes it easier to navigate the team on what is the next step to take. It takes a well-planned contingency to ensure business continuity
amidst such situations. It is pretty much like securing an insurance policy that you wish you never need. However, when the situation arises, he says, a carefully laid out supply chain contingency plan would define the next steps for the business- and not be caught in a matter of staying afloat or begin sinking. “We need to prioritise the threats that can lead to work flow disruption, such as natural calamities, sabotage, and labour issues. And then identify the types of disruptions that may take place, such as production cuts, raw material shortages, and interruption in transport links. These critical preparations could determine the future of the business,” he explains. A future that he sees as being quite bright. “We are seeing continuous growth for the logistics sector in the run up to the UAE’s hosting of World Expo in 2020, and the country’s determined efforts to achieve its goals as embodied in UAE Vision 2021. In addition, the UAE Government is highly supportive of the sector, particularly with the launch of the Authorised Economic Operator programme, which makes the UAE one among 63 countries worldwide that enables the smooth flow of trade, customs, and supply chains. Such initiatives will further boost the industry’s strategic position in providing services across the region. I also see the unprecedented advancements in ICT and the customer-centric approach to services as major factors that will continue to drive growth in the sector,”he concludes.
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RECRUITMENT
7 Hiring and salaries
30 JUNE 2017
RECRUITMENT
Gary Ward
Munawar Shariff speaks to two leading recruitment experts - Gary Ward, Operations Director, Hays Oil and Gas, EMEA and Brian Cartwright, MD, Top Management Resources Group for the logistics industry - to gauge the hiring scene currently and in the near future
Gary Ward, Operations Director, Hays Oil and Gas, EMEA The Oil and Gas industry is moving again, thanks to the increase in oil prices in the first quarter of 2017. Sentiment in the market is understandably cautious. “However, we have seen an uplift in hiring activity, as formerly paused projects have resumed and new projects are underway,” says Gary Ward, Operations Director, Hays Oil & Gas, EMEA. According to Ward, different parts of the GCC are moving at different paces, with Saudi Arabia leading the way. Organisational re-structures in response to the low oil
prices of previous years (which resulted in depressed hiring activity), have largely taken place in the GCC, and he anticipates positive recruitment trends going forward.“The exception to this is in the UAE, mainly Abu Dhabi, where the general feeling is the region won’t have organisational re-alignment completed until well into 2018, and which could have a negative effect on hiring activity. As always, everything hinges on the price of oil and the geo-political manoeuvring of the US, Russia, Saudi Arabia, and potentially Iran,”he adds. From the Oil and Gas perspective, many organisational efficiency drives - including
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RECRUITMENT
Brian Cartwright
Whilst it’s not expected that the oil and gas industry will make any more redundancies, it is balanced on a knife edge, and the next six months could define the direction for the major operators and their supply chain. It’s moving upwards, but very cautiously
redundancies – and economic stagnation has been happening for the last two years. “Whilst it’s not expected that the industry will make any more redundancies, it is balanced on a knife edge, and the next six months could define the direction for the major operators and their supply chain. It’s moving upwards, but very cautiously,”says Ward. Within this sector, recruitment happens on a needs basis, where candidates already possess the level of expertise needed, so there have not been any significant changes in terms of learning and development. “What has changed is the investment in the training and development of UAE National employees, with skill enhancement programmes becoming more commonly adopted by organisations. No longer are UAE Nationals hired purely to meet government quotas - the programmes ensure that a career path within the organisation is mapped out, so as to enable them to hold business critical roles,”explains Ward. The candidate pool has remained the same, more or less, in terms of calibre, but there has been an increase in the number of available candidates in response to the high level of redundancies made globally with the Oil and Gas sector.“As a result of this, operating companies are being more selective over the quality of candidates that they hire. Individuals with proven experience, which matches the available job vacancy, are of preference to entry level / inexperienced candidates,”says Ward, indicating a bleak scenario for new graduates, adding,“It’s not envisaged at the moment that there will be any salary increases to offset VAT across the GCC. Salaries are much the same as five years ago, however, benefits within the Oil and Gas industries have declined sharply.” However, on the positive side, HR policies and procedures are becoming much more standardised across geographies than they previously were.“Employers are typically recruiting from around the globe, and therefore applying international standards to the way they handle and nurture employees,”he concludes.
Brian Cartwright, MD, Top Management Resources Group “A major slowdown in business across the region has significantly reduced hiring activity in the Supply Chain and Logistics sector. Many organisations are focusing on ‘right sizing’ and restructuring. I have seen an increase in redundancies and non-renewal of expat contracts, especially at mid to senior management levels,”says Brian Cartwright, MD, Top Management Resources Group. In the GCC Supply Chain and Logistics Sector, according to Cartwright, the UAE and Saudi Arabia are leading in terms of available job opportunities. Positions requiring in-depth knowledge of supply chain and logistics operations, and people who have the experience, local market knowledge, and proven ability to identify and implement processes and solutions that can help improve efficiencies and lead times and prevent unnecessary expenditure are the most sought after. This applies across the board, from 3PLs to Shipping Lines, Airlines, Seaports, Airports, and the end users. “Supply Chain management is arguably one of the most important functions in the vast majority of organisations these days, as it can literally make or break a business. I would even go as far as to predict that in the near future, many C-level executives will have come from a supply chain management background,”Cartwright predicts. “Salaries have not kept up with cost of living in recent years. In the GCC, in particular, costs such as schooling in certain countries have continued to increase, yet allowances for employees have either remained the same or have been reduced. This has made it challenging for organisations to attract even internal candidates to the region due to high cost of living, and also the cost of initial set up as an expat,”he admits. When it comes to training, Cartwright has a suggestion.“Companies need to invest and engage with their employees more than ever before. Additional financial investments may not be viable, but spending more time listening to and coaching, mentoring, and developing people goes a long way,”he concludes.
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RETAIL TECHNOLOGY
Making tracking
easier
Leading British retailer, John Lewis, whose first UAE store opened in Dubai Festival City earlier this year is rolling out a UHF RFID solution, provided by Checkpoint Systems, at 34 locations across the United Kingdom. RFID Journal’s, Claire Swedberg explains
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U
K department store retailer John Lewis has deployed ultrahigh-frequency (UHF) EPC RFID technology at 34 of its 46 stores to improve inventory management of key fashion products. The rollout took place during the course of just three months late last year, and 25,000 stock-keeping units (SKUs) across lingerie, sleepwear, swimwear, and men’s formal wear are now being tracked at those locations via RFID readers. The company opted to deploy RFID tagging for entire product SKUs to make the deployment simpler to manage, says Rob Mitchell, John Lewis’s manager of selling support.“This volume will increase through 2017 as we roll out to more assortments,”
Mitchell reports. By early 2018, the retailer expects all apparel to be tagged during three additional phases. The solution is provided by security technology company Checkpoint Systems, which offers software and integration services, with tags from Avery Denison, and handheld RFID readers provided by Zebra Technologies. The handheld readers are deployed at all of the 34 branches, and the Checkpoint software to manage the collected read data resides on the retailer’s centralised server. There, the software provides reporting for central and branch operational teams. Since the system was taken live late last year, Mitchell reports, the increase in on-shelf availability provided by the system has boosted sales. An additional benefit is a
RETAIL TECHNOLOGY
reduction in stock levels, he says, since the company no longer needs to store as much inventory at branches in case product may run out“We can better direct our replenishment effort,”Mitchell states,“and stock levels have been reduced as we have been better able to trust the stock figures, and, therefore, remove contingency stock.” John Lewis is owned by the John Lewis Partnership. Before this deployment, the company embarked on an RFID pilot in 2014 and 2015, at three branches across a few select fashion items. Based on that pilot’s success, the store decided to roll out the system on a universal level across entire SKUs. Approximately 80 per cent of all tagged products are being tagged at the point of manufacture, Mitchell explains,
Once tags are applied to garments, each tag’s unique ID number is stored, along with the corresponding SKU, in the inventorymanagement software
while the remaining 20 per cent are being tagged by a third party. Once tags are applied to garments, each tag’s unique ID number is stored, along with the corresponding SKU, in the inventorymanagement software. The tags are first interrogated at the store branch by sales personnel during receiving. From that point, the tags can be read for regular inventory counts, in order to ensure that products are replenished on store shelves as they are sold, and to prevent out-of-stocks. The department store sells products from a large number of suppliers. Thus far, about 100 of these companies are applying RFID tags to products destined for John Lewis stores. The firm chose to start using RFID readers at stores only (as opposed to distribution centres), where the greatest impact would be felt by customers, since RFID tag reading at the store level boosts onsite inventory accuracy. With the RFID data being collected, the retailer has now been challenged with determining how to analyse the large volume of information.“Now that we are more familiar with the data available, we are looking to refine our reporting this year so that it is easy to highlight key metrics,”Mitchell states. Although handheld RFID readers are providing an improvement in inventory accuracy, Mitchell says, fixed readers could offer more automated data collection, as products are moved to the sales floor.“We are interested in potential uses of transitional readers to track movement of stock from stock room to shop floor,”he adds,“but have not begun any work on this as yet.” In the future, Mitchell reports, the company may expand its RFID use to nonfashion lines, such as linens. Such linens come in a variety of sizes, he says, making inventory management challenging, and would thus benefit from RFID management. “Once we have enough of our assortment tagged,” he states,“we may look beyond the core functionality of RFID to see how it could be used to enhance the customer experience in areas such as fitting rooms.” In 2014, the retailer’s flagship store launched a pilot involving RFID-tagged furniture shapes and fabric samples, allowing customers to view selected chairs, sofas and coverings displayed on a computer monitor. -Claire Swedberg, Senior Editor, www. rfidjournal.com
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ENVIRONMENT
Toyota tests zero emission truck Toyota puts zero emission fuel-cell semi-truck to test at the Port of Los Angeles
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I
magine this. It’s the 710 Freeway in the US, heading south, bumper-to-bumper semis hauling cargo to and from the bustling Ports of Los Angeles and Long Beach. Now imagine those trucks moving quietly, quickly, and without producing any emissions. This is a dream that Toyota Motor North America, Inc (TMNA) is working towards making a reality. TMNA has revealed ‘Project Portal’ - a hydrogen fuel cell system designed for heavy duty truck use at the Port of Los Angeles. Announced at an event with port officials and representatives from California Air Resources Board (CARB) and the California Energy Commission (CEC), the zero-emission truck proof of concept will take part in a feasibility
study, examining the potential of fuel cell technology in heavy duty applications. The study will begin this summer, and contribute to the Port’s Clean Air Action Plan, which has dramatically reduced harmful emissions from operations at the Ports of Long Beach and Los Angeles since 2005.“As they did with the Prius and the Mirai, Toyota is taking a leap into the future of technology. By bringing this heavy duty, zero emission hydrogen fuel cell proof of concept truck to the Port, Toyota has planted a flag that we hope many others will follow,”said Mary D Nichols, Chair, CARB. “Toyota believes that hydrogen fuel cell technology has tremendous potential to become the powertrain of the future,”said Bob
ENVIRONMENT
Project Portal is just one part of Toyota’s ongoing commitment to fuel cell technology and the potential of a hydrogen society
Aerial view of harbor cargo containers in Southern California
Carter, EVP Toyota Motor North America, Inc, adding,“CARB will be following the progress of this feasibility study with interest, as we look to develop the best mix of regulations and incentives to rapidly expand the market for the cleanest, most efficient big trucks to meet the need for dramatic change in the freight sector.” Project Portal is the next step in Toyota’s effort to broaden the application of zeroemission fuel cell technology that can serve a range of industries. It is a fully functioning heavy duty truck with the power and torque capacity to conduct port drayage operations, while emitting nothing but water vapour. Heavy duty vehicles make up a significant percentage of the annual emissions
output at the Port of Los Angeles, and the Portal feasibility study may provide another path to further reduce emissions. “Toyota believes that hydrogen fuel cell technology has tremendous potential to become the powertrain of the future,”said TMNA Executive Vice President Bob Carter. “From creating one of the world’s first mass market fuel cell vehicles, to introducing fuel cell buses in Japan, Toyota is a leader in expanding the use of versatile and scalable zero-emission technology. With Project Portal, we’re proud to help explore the societal benefits of a true zero emission heavy-duty truck platform,”he added. The Project Portal platform is designed to provide the target performance required to
support port drayage operations. The truck generates more than 670 horsepower and 1325 pound feet of torque from two Mirai fuel cell stacks, and a 12kWh battery, a relatively small battery to support class eight load operations. The concept’s gross combined weight capacity is 80,000 lbs, and its estimated driving range is more than 200 miles per fill, under normal drayage operation. “Hydrogen fuel cell vehicles play a role in California’s efforts to achieve greenhouse gas emission reduction goals,” said Janea A Scott, Commissioner, California Energy Commission Added Tony Gioiello, Deputy Executive Director of Port Development, Port of Los Angeles,“The Port of Los Angeles is excited to collaborate with Toyota to explore the feasibility of fuel cell technology for port drayage operations. Our port and industry stakeholders have demonstrated their leadership in reducing pollution from portrelated operations, and we see the potential of Toyota’s zero-emission heavy-duty truck technology as another solution to meet the long-term goals of the San Pedro Bay Ports Clean Air Action Plan.” Project Portal is just one part of Toyota’s ongoing commitment to fuel cell technology and the potential of a hydrogen society. It follows on the company’s continued work to expand California’s hydrogen refuelling infrastructure, including the recently announced partnership with Shell to increase the number of hydrogen refuelling stations in the state. “Hydrogen fuel cell vehicles play a role in California’s efforts to achieve greenhouse gas emission reduction goals, improve air quality, and reduce our reliance on fossil fuels,”said Scott, adding,“That’s why the California Energy Commission is investing in the refuelling infrastructure needed to support adoption of these vehicles. The Commission applauds Toyota for putting this cutting-edge technology to use in a heavy-duty freight proof of concept.” “This demo will show how fuel cells can help support the heavy-duty sector’s efforts to increase efficiency, transition to zero-emission technologies, and increase competitiveness,” she concluded. Source: www.supplychain247.com
JUNE 2017 39
PEOPLE
Jobs in renewable
energy Renewable energy employs 9.8 million people worldwide, as indicated by a new IRENA report
40 JUNE 2017
M
ore than 9.8 million people were employed in the renewable energy sector in 2016, according to a new report from the International Renewable Energy Agency (IRENA). Renewable Energy and Jobs – Annual Review 2017, released at IRENA’s 13th Council meeting, provides the latest employment figures of the renewable energy sector, and insight into the factors affecting the renewable labour market. “Falling costs and enabling policies have steadily driven up investment and employment in renewable energy worldwide since IRENA’s first annual assessment in 2012, when just over seven million people were working in the sector,” said IRENA Director-General Adnan Z. Amin, adding,“In the last four years, for instance, the number of jobs in the solar and wind sectors combined has more than doubled.” “Renewables are directly supporting broader socioeconomic objectives, with employment creation increasingly recognised as a central component of the global energy transition. As the scales continue to tip in favour of renewables, we expect that the number of people working in the renewables sector could reach 24 million by 2030, more than offsetting fossil-fuel job losses, and becoming a major economic driver around the world,”he elaborated. The Annual review shows that global renewableenergy employment, excluding large hydropower, reached 8.3 million in 2016. When accounting for direct employment in large hydropower, the total number of renewable-energy jobs globally climbs to 9.8 million. China, Brazil, the
United States, India, Japan, and Germany accounted for most of the renewable-energy jobs. In China, for example, 3.64 million people worked in renewables in 2016, a rise of 3.4 per cent. IRENA’s report shows that solar photovoltaic (PV) was the largest employer in 2016, with 3.1 million jobs - up 12 per cent from 2015 - mainly in China, the United States, and India. In the United States, jobs in the solar industry increased 17 times faster than the overall economy, growing 24.5 per cent from the previous year to over 260,000. New wind installations contributed to a seven per cent increase in global wind employment, raising it up to 1.2 million jobs. Brazil, China, the United States, and India also proved to be key bioenergy job markets, with biofuels accounting for 1.7 million jobs, biomass for 0.7 million, and biogas for 0.3 million. “IRENA has provided, this year, a more complete picture on the state of employment in the renewables sector, by including large hydropower data. It is important to recognise these additional 1.5 million working people, as they represent the largest renewable energy technology by installed capacity,”said Dr Rabia Ferroukhi, Head of IRENA’s Policy Unit and Deputy Director of Knowledge, Policy, and Finance. The report finds that globally, 62 per cent of the jobs are located in Asia. Installation and manufacturing jobs continue to shift to the region, particularly Malaysia and Thailand, which has become global centre for solar PV fabrication. In Africa, utility-scale renewable energy developments have made great strides, with South Africa and North Africa accounting for three-quarters of the continent’s 62,000 renewable jobs. “In some African countries, with the right resources and infrastructure, we are seeing jobs emerge in manufacturing and installation for utility-scale projects. For much of the continent, however, distributed renewables, like off-grid solar, are bringing energy access and economic development. These off-grid mini-grid solutions are giving communities the chance to leapfrog traditional electricity infrastructure development and create new jobs in the process,”Dr Ferroukhi said.
RFID
Asset management with
RFID Mike Beedles, Director Integration Services, SATO America, talks about how RFID Technology simplifies asset management
F
aced with intense emphasis on profitability, and the need to comply with new governmental accounting rules, companies are recognising the critical need for real-time, effective asset management solutions to help them run leaner and smarter. Organisations, challenged with running large IT infrastructures with limited resources, are becoming aware of technologies such as radio frequency identification (RFID), and their capability to ensure asset optimisation and enhance profitability. Many companies, as well as federal, state, and local governments are turning to technology to handle the extra workload, because it enables them to track
42 JUNE 2017
and locate valuable assets, which are being lost or stolen at an alarming rate, without the need for additional labour.
Advantages of RFID Consider the hundreds of thousands of desktop and laptop computer units throughout offices, classrooms, and satellite locations throughout the school and government systems, manufacturing, and logistics facilities in the United States. Most computer equipment has a life cycle of three to five years, and 20-30 per cent of the total units are replaced annually. This cost is in the hundreds of millions of dollars and, if lost or stolen, can cost companies, the government and taxpayers millions of dollars.
Typically, when a new piece of equipment is deployed, the manufacturer’s serial number is logged, and a sequentially numbered bar code tag is attached to the computer and usually logged in via a hand-written document book, or keyed into an accounting system. The system is then audited by an internal team or external company, which locates and updates the system on a quarterly or annual basis. Once the audit has been completed, a printed discrepancy report provides the serial number and description of the item that has not been located. The problem with this ‘manual’ or even ‘barcoded’ systems is that the process relies on human intervention, and provides many opportunities for logging or key entry
RFID
errors. Studies have shown that one in 500 keystrokes can lead to an error, and since a direct line of sight is required to scan a barcode, it is only effective when the asset can be physically located. Given the monetary impact, the human error factor is not an acceptable solution. In most situations, manual audits become ‘search and destroy’ missions. Teams of auditors are set up with auditing books, and they are sent out to log or scan each and every asset that has been logged. If the assets have been tagged or logged correctly initially, this usually captures only about 80 per cent of the items. Assets that may be in a closet, drawer, packed in boxes, or have simply been pilfered, are not found, and are
written off the books, and the system takes the loss and the dollar impact. RFID is a seamless, wireless environment that allows for non-contact identification reading that is similar to barcodes, but offers a more extensive list of benefits than current barcode systems. Although barcode systems are still workable, effective processes must be put in place in order for them to be successful. In recent installations, companies have bypassed manual or barcode deployments and opted for RFID, since the cost to deploy is not much more than traditional barcode applications, and, in some cases, there is no additional cost to deploy the system. RFID is comprised of three main components: an antenna or coil, a transceiver with decoder,
JUNE 2017 43
RFID
and a transponder (could be a handheld), or radio frequency (RF) tag, which is electronically programmed with information suited to your specific needs. The RF tag allows for additional specific information to be added, and information to be stored about the tagged item, rather than a traditional barcode, which can only reference a general item description. This enables companies to track carton or pallet level data, track assets, vehicles, manage tractor trailer/containers, and control inventory, as well as personnel. The other great benefit is that RFID software and configured hardware can read a multiple number of tags instantaneously, instead of the traditional one-scan-at-a-time that is currently provided by traditional barcodes, and no line-of-sight is required.
RFID - Plan for success Most RFID systems in the industry have focused on supply chain, or large scale warehouses or manufacturing. While this approach is great, and has saved millions in loss of goods, as well as provided visibility to the goods that are in supply chain, there is a much larger need to track and locate valuable assets. In order to be successful at tagging, logging, and actually utilising RFID effectively, it is imperative to use a five-step plan. Step I: It is essential to use a numbering algorithm that makes sense and applies to an organisation’s local or national system (ie, state, county, asset number, serial number, manufacturer’s code, and date issued). This not only helps identify the asset down to the serial number, but it also allows for warranty and repair contracts to be supported and maintained. Step II: Multiple types of RFID tags must be tested to ensure that one selected work best on the specific assets. The antenna must be compatible with the outer or inner components (ie, metal, magnetic, or detuning materials or form factors). Although many tags ‘will work’ for the assets they are affixed to, it does not mean that they are the best tags for the job. In some cases, the proper adhesive needs to be tested to ensure longevity, and some tags can be secured via screws, which eliminate the need for an adhesive backing. Location
44 JUNE 2017
The optimal implementation is an enterprise side solution, which has completely integrated hardware and software solutioninterfaced to host or ERP systems
and form factor of the tag will drive the final tag selection. Step III: Consider if the application uses LF, HF, or UHF for the tag and RFID frequency. Many countries require specific frequencies, and regulations must be followed to ensure that the equipment is compatible in the countries where the tagged assets will be used. Step IV: It is essential to select a company that can provide a turnkey service. Since there are many elements to the implementation
of RFID, working with a provider that can deliver a complete solution, and offers full post installation support is critical. It is also important to choose a company with an established reputation for successful RFID solutions, and the ability to support hardware, software, and tags that will be phased out will be very important. Failure to choose a supplier wisely has forced many organisations to implement an entirely new solution when their supplier goes out of business.
RFID
Step V: It is important to verify that a supplier’s products come with a warranty, and have the system tested before making a purchase. A live pilot test is worth thousands in savings to ensure the system works for the specific application.
Adaptability While smaller organisations can benefit from a standalone application of RFID, they can also expand their use of the technology
incrementally as their requirements change. The optimal implementation is an enterprise side solution, which has completely integrated hardware and software solution-interfaced to host or ERP systems. For smaller to mid-size organisations, there are software packages that can run standalone and no additional software is needed. By replacing antiquated methods of tracking assets and managing depreciation with RFID, organisations gain the adaptability to respond
to tax law changes, and, more importantly, to eliminate time-consuming, labour intensive, and inaccurate asset management systems. Working with a supplier offering a complete RFID solution gives companies the opportunity to implement a cost-effective solution that will assure them that their assets, from in-house equipment and inventory, to order receiving and shipping, are being managed with 100 per cent accuracy. www.satoamerica.com
JUNE 2017 45
SHIPPING
I
Milaha launches door-to-door shipping service between Qatar and the UAE, targeting the SME market
Cargo connection
46 JUNE 2017
f you want to transport goods between Qatar and the UAE, there is now a new option. Milaha, a Qatar-based maritime transport and logistics conglomerate, has launched a door-to-door shipping service between the two countries. Mainly targeting SMEs in the automotive spare parts, fashion retail, and the Fast-Moving Consumer Goods (FMCG) sectors, Milaha will use its own marine transport assets and logistics infrastructure to fulfil the service. The service has been launched as part of the company’s strategy to be a one-stop shop for its partners’ shipping and logistics requirements. The frequency of the service will initially be weekly, and it will allow customers to track their cargo online from point of origin to destination. Said Milaha’s President and CEO, Abdulrahman Essa Al-Mannai,“This new service is a great example of the advantage of our presence across the supply chain, and how we can leverage the synergies among our business units – in this case, our Logistics and Container Shipping units – to give our clients and partners seamless solutions at very competitive prices.” Milaha’s new service is ideal for SMEs as it provides a quick delivery time, with regular departures between Dubai and Doha, and a single rate that covers pick-up, ocean transport, customs clearance, and delivery within the two cities. The first consolidated shipment of the service happened last month.
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Bee’ah and Masdar join forces Bee’ah and Masdar launch joint venture to develop the first waste-toenergy plant in the region
48 JUNE 2017
WASTE MANAGEMENT
I
n line with the vision of His Highness Sheikh Dr Sultan bin Muhammad Al Qasimi, Member of the Supreme Council and Ruler of Sharjah, around environmental challenges, and ways of maintaining a pollution free environment, Bee’ah and Masdar have announced a joint venture, Emirates Waste to Energy Company (EWEC), to develop waste-to-energy plants across the region. The first project will be the Sharjah MultiFuel Waste-to-Energy Facility. The plant will be the first in the region, and will treat, within its first phase, more than 300,000 tonnes of municipal solid waste (MSW) each year, and have a power capacity of around 30 megawatts (MW). Bee’ah set the ambitious target for Sharjah to achieve zero waste when the company was created back in 2007. At present, the emirate diverts 70 per cent of its waste away from landfill. With the
completion of this new facility, Sharjah will soon become the first city in the Middle East to achieve the target of 100 per cent diversion of waste from landfill. His Excellency Dr Thani bin Ahmed Al Zeyoudi, Minister of Climate Change and Environment for the United Arab Emirates, attended the launch of EWEC, and witnessed the signing of the waste supply agreement (WSA) and power purchasing agreement (PPA) for the landmark wasteto-energy project by Bee’ah, Masdar, and Sharjah Electricity and Water Authority (SEWA) officials. Bee’ah and Masdar said EWEC’s first project would leverage the strengths of both companies to pave the way for further waste-to-energy facilities in the UAE and the region, delivering commercial solutions to meet the challenge of solid waste disposal and the ever-growing demand for clean energy.
Bee’ah and Masdar launch joint venture to develop landmark waste-to-energy plant in Sharjah
JUNE 2017 49
WASTE MANAGEMENT
Bee’ah and Masdar launch joint venture to develop landmark waste-to-energy plant in Sharjah
H E Dr Al Zeyoudi said,“The Waste-toEnergy joint venture in Sharjah represents an important step in our endeavour towards sustainability, and a bold and unconventional solution to address the increasing development challenges in a sustainable way to achieve the objectives of the National Agenda for UAE Vision 2021. Hence, this pioneering national project is particularly important in the realisation of two main objectives of our National Agenda; raising the percentage of treated waste to 75 per cent, and increasing the contribution of clean energy in the national energy mix to 27 per cent.” Added Salim Al Owais, Chairman of Bee’ah,“Together with our strategic partner Masdar, we have set the ambitious goal of making the UAE a beacon for best environmental practices in the Middle East. We also intend to set an example to the world for how a country that has traditionally been heavily reliant on fossil fuels can embrace change and become a leader in green technology, through vision, determination, and hard work.” Al Owais’s comments were echoed by Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar,“Masdar firmly believes in industry collaboration
50 JUNE 2017
as the most effective way of advancing the deployment of commercially viable technologies, while supporting the UAE’s goals for sustainable economic development.” The signing of the power purchase agreement with SEWA also took place with the EWEC, which was assented by Khaled Al-Huraimel, Bee’ah’s Group CEO, Al Ramahi, and HE Dr Eng Rashid Al Leem, Chairman of SEWA. Under the terms of the agreement, the EWEC will supply SEWA with the power generated from its waste-toenergy plant, the first of its kind in the UAE. Commenting on the signing ceremony, HE Dr Alleem, said: “We are very happy, even before the facility has been built, to demonstrate through this contract, that electricity generated by waste has a very important place in the energy supply chain, and to acknowledge the added value of such green energy in terms of reducing carbon emissions. That all of this is happening in our home emirate makes us especially proud, it truly is a win-win situation for both SEWA and our new partners Bee’ah.” The launch event was attended by senior representatives from CNIM, a French company considered a world leader in treating and recovering energy from waste,
led by Nicolas Dmitrieff, Chairman of CNIM, and Mohamed Ayachi Ajroud. CNIM was also signed on as the lead contractor on the project, and will not only design and build, but also operate the new joint venture plant, which is to be located within the site of Bee’ah’s existing Waste Management Center Centre. When it comes online, the new joint venture facility in Sharjah will be able to process as much as 300,000 tonnes of solid waste every year that would otherwise have been buried in landfill sites, thus unlocking the potential of an untapped source of energy. In addition to recovering valuable materials for recycling, the new plant will incinerate up to 37.5 tonnes of solid waste per hour, generating 30 megawatts of energy. The new waste-to-energy plant has been designed to meet the strictest environmental standards, complying with the European Union’s Best Available Techniques, which are widely recognised as setting the worldwide standard. Its construction and the ratification of these agreements will serve to raise the UAE’s profile as a world leader in sustainability and green technology, harnessing best practices and deploying them, for the benefit of its citizens, and for that of the world.
Subscribe today Global Supply Chain is a magazine that aims to provide quality editorial content aimed at providing the supply chain industry with information that assists in meeting and overcoming challenges and making the most of supply chain opportunities. Global Supply Chain will be the publication of choice covering all aspects of the industry from transport (air, sea, road, rail), technology, warehousing, materials handling, reverse logistics, sustainability and more. This media pack has the in-depth editorial plan for 2014 as well as rates and specifications. We look forward to establishing a successful, long term relationship with you.
June 2017 Issue 38
May 2017 Issue 37 April 2017 Issue 36
ENHANCING THE BUSINESS OF LOGISTICS
ENHANCING THE BUSINESS OF LOGISTICS ENHANCING THE BUSINESS OF LOGISTICS
THE HUMAN RESOURCE Detrimental to business success PACKAGING HEALTHCARE And transporting it right
ECONOMIC
IMPACT Road, rail, sea transport
Qatar’s deadline 2022 is approaching
Water scarcity The GCC’s strategy
Aviation safety
Tasneef
At the World Aviation Safety Summit
•GSC_May 2017_Cover.indd 1
Autonomous vehicles
Certifying safety at sea
4/30/17 2:32 AM
Time compression
Here to stay
For successful SC management
•GSC_March 2017_Cover2.indd 1
Hiring and salaries 2017
Green tech
How is it looking?
Bee’ah and Masdar sign JV
4/1/17 22:23
KSA’s healthcare
Medical cities, insurance and more
•GSC_June 2017_CoverF.indd 1
5/31/17 11:31 PM
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raising industry standards Global Supply Chain has partnered with Brian Cartwright, Managing Director, Top Management Resources Group (TMR), to run a series of exclusive interviews with industry leaders to provide real time insight on the regional supply chain and logistics sector. 52 JUNE 2017
INDUSTRY LEADERS
the government and the private industry plays a decisive role together. It’s time for both to sit around the same table and talk to each other, and chart the goal and the path in phases and steps. There are many great ideas and initiatives being shared by the government and private sector organisations throughout the region. But it can be challenging to get enough traction and alignment between key stakeholders from all sides to be effective enough to make a difference. What can be done to help drive this forward?
In this first article, Cartwright speaks to Krishna Kumar, General Manager, Logistics – YBA Kanoo, to find out the status of the sector.
I
n the current economic climate, business continues to be tough going for many organisations, and the logistics space in particular has been impacted greatly, so when there was an opportunity to talk to Krishna Kumar, GM Logistics for the Kanoo Group, on the good, the bad, and the future of logistics in the region, it had to be done. Kumar took over the running of the group’s logistics business a year ago, having moved across from his previous role as Managing Director of Kanoo Terminal Services (a joint venture between Kanoo and Maersk), where he spent the past 25 years. Prior to his time at Kanoo, he worked for Johnson & Johnson and Colgate Palmolive for several years, hence he possesses a wealth of insight and experience gained from major MNC’s and long established family-owned businesses.
Here are some excerpts: What do you think the future of logistics looks like in the Middle East?
The future is extremely bright, but we do need to focus on encouraging more collaboration and communication between key stakeholders in government and the private sector. The future success of the industry should be a joint story, one where
Implementing ideas will take more than just will - it will take grit and sheer determination. The tools are there, technology is available, people can be retrained – but the resources need to be given shape by the joint forces of both the government and the industry. You have a lot of experience in Saudi Arabia, the biggest market in the region for logistics. How important is the KSA’s role in this?
As the largest market in the region, both in terms of imports and exports, Saudi Arabia will make a huge difference, and impact the way logistics is done in the region. It is imperative that the logistics community and government in Saudi Arabia is a major supporter and influencer of change and development.
as training and qualification in the field of logistics has become a primary guideline for selection of employees, and improving the skill sets of the already employed. Trainability, and hence, employability, of local population is also now being taken very seriously, with the government of each country making it a law. This has led to logistics providers making a concerted effort to engage and upskill nationals, as well as their expats employees. How is Kanoo Logistics contributing to upskilling employees and raising logistics industry standards?
We are raising the internal bar first – our group now has a dynamic team of professionals led by our group CEO, Dr Patrick Chenel. We have laid out the cards on the table, and charted out the path into the future by taking steps – bold, yet careful; fast, yet consistent; local, yet global; individually, yet as one company. We are raising the standard of our group offerings with technology, compliance, people competence, operational excellence – all aimed at one single goal: a strong customer focus and delivery.
What are your thoughts on how e-commerce is affecting the logistics sector?
The impact of e-commerce is already seen here, with players upping their game, and also major shipping lines reengineering their model to dip into the end-to-end solutions, via digital platforms. Technology is now a differentiator of logistics services – be it, transport, warehousing, tracking, etc, which creates the visibility for the customer. Overall, the rise of e-commerce should have a very positive impact by accelerating the need for improved cross-border collaboration between countries. What do think about the level of skills and the availability of people with logistics experience in the region?
We are facing talent shortages for some functions, but it’s going in the right direction,
Brian Cartwright, Managing Director, Top Management Resources Group (TMR), is well-known throughout the international supply chain and logistics sector as a focused and highly proactive business leader, mentor, and thought leader.
JUNE 2017 53
The Digital Shadows Analyst Team analyses the details of the recent WannaCry cyberattack in an attempt to zero in on the culprits
WannaCry: An Analysis of Competing Hypotheses
O
n May 12, 2017, as the WannaCry ransomware spread across computer networks across the world, a variety of explanations also began to worm their way through the information security community. Who was responsible for
54 JUNE 2017
the WannaCry campaign? And what was the objective? Ransomware suggested it was the work of cybercriminals, although, given the sheer scale of infections and disruption, some commentators suspected the hand of a nation state. Despite relentless analysis from the
RANSOMWARE ANALYSIS
security research community that has brought fragments of new information to the fore, no consensus has yet been reached on an attribution for the campaign. One of the most recent theories put forward rests on a possible connection between WannaCry and the Lazarus Group, an actor
that has previously been linked with several high-profile network intrusions, and assessed as highly likely to have some association with the Democratic People’s Republic of Korea (DPRK). Analysis has indicated that WannaCry samples from February 2017 contained a small section of code identical to
those used in previous Lazarus campaigns. At the time of writing, however, we assessed there to be insufficient evidence to corroborate this claim of attribution to this group, and alternative hypotheses should be considered. While malware may initially be developed and used by a single actor, this does not
JUNE 2017 55
RANSOMWARE ANALYSIS
mean that it will permanently remain unique to that actor. Malware samples might be accidentally or intentionally leaked, stolen, sold, or used in independent operations by individual members of a group. It is therefore important to consider other factors, such as the consistency of an operation with previous activity attributed to an actor.
56 JUNE 2017
Digital Shadows has, therefore, applied the Analysis of Competing Hypothesis (ACH) technique to the information currently available through sources. ACH uses a weighted inconsistency algorithm to assign numeric values - weighted by the assessed reliability and relevance of each data point - to represent how consistent the available evidence is with
a given hypothesis. While the aim here was not to provide a conclusive attribution for the WannaCry campaign, this structured analytical technique allows us to assess the reliability and relevance of the data presented thus far, as well as make some tentative assessments over the type of actor most likely to have been behind last week’s attacks.
As such, we compared four hypotheses for the purposes of this exercise. That the campaign was the work of: A sophisticated financially-motivated cybercriminal actor - H1 An unsophisticated financially-motivated cybercriminal actor - H2 A nation state or state-affiliated actor conducting a disruptive operation - H3 A nation state or state-affiliated actor aiming to discredit the National Security Agency (NSA) – H4 Using a mixture of primary and secondary reporting, as well as assessments from Digital Shadows analysts, we have included a collection of the most salient data points to have emerged at the time of writing. As well as the widely-discussed
use of the DOUBLEPULSAR backdoor dropper, ETERNALBLUE exploit, and SMB vulnerability, the latter for propagation, we have included several other pieces of evidence to drive our assessment. These are presented in the ACH table, though some of the more significant points include: So-called “kill-switch”, probably an antisandboxing feature - MalwareTech, who discovered the unregistered domain, now believes this was most likely included as a badly-thought out anti-analysis measure. Low number of Bitcoin wallets a result of an unintentional bug - Symantec have reported that the creation of only three Bitcoin wallets for victims to transfer payment into was the result of a bug in
JUNE 2017 57
ACH reveals the most plausible scenario is that an unsophisticated cybercriminal actor launched the WannaCry Campaign. H1
H2
H3
-1.414
-5.0
-3.0
N
N
N
N
N
N
N
N
N
N
N
N
N
N
I
C
N
N
Medium
N
N
N
N
High
I
C
I
C
High
C
C
C
C
Medium
Medium
I
C
N
N
High
High
I
C
I
I
Primary
High
High
I
C
N
N
DS Assessment
High
Medium
I
C
N
N
Money had not been cashed out
Primary
High
High
I
C
N
N
Untargeted geographic distribution
DS Assessment
Medium
Medium
I
C
I
C
No resurgence of campaign
Primary and Secondary reporting
High
High
N
C
N
N
Lack of supporting media narrative
DS Assessment
Medium
Medium
N
N
N
I
Code links to Lazarus Group
Secondary reporting
Low
Medium
C
I
C
C
Code similarities with other North Korean operations
Secondary reporting
Medium
High
C
I
C
C
Evidence
Evidence
Type
Credibility
Relevance
-13.414
Use of ETERNALBLUE Equation Group exploit
Secondary reporting
High
High
Installed DOUBLEPULSAR backdoor
Secondary
reporting
High
High
Exploitation of SMB vulnerability to propagate
Secondary reporting
High
High
ETERNALBLUE relatively easy to use
DS Assessment
High
Medium
Anti-analysis feature usable as kill-switch
Secondary
reporting
High
High
Samples first appeared in Feb 2017
Primary
Medium
No evidence of phishing vector (untargeted spread)
Secondary reporting
High
No operator input needed for encryption
Secondary reporting
High
Victims who paid reportedly did not receive decryption keys
Primary
Only three BTC wallets produced due to race condition bug
Secondary reporting
Ransom demand 300 USD per machine rather than against individual organizations Inefficient extortion approach
C
Evidence is consistent with hypothesis
I
Evidence is inconsistent with hypothesis
N
Evidence is neither consistent nor inconsistent with hypothesis
the malware’s code, referred to as a race condition. No evidence that the malware was delivered via phishing emails - IBM X-Force, for example, scanned over one billion emails passing through its honeypots and found no evidence suggesting spam/phishing was the initial infection vector. Unconfirmed links to Lazarus Group and North Korean campaigns - Some researchers have now claimed that WannaCry contained pieces of code previously associated with the Lazarus Group, as well as two malware variants (called Joanap and Brambul) used in attacks against South Korean organisations. This connection, however, was assessed to be
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primarily based on the ordering of ciphers and public libraries used by the Lazarus Group, and inconclusive at the time of writing. Though by no means definitive, we assessed that a WannaCry campaign launched by an unsophisticated cybercriminal actor was the most plausible scenario, based on the information that is currently available. While there were numerous data points that were consistent with this assessment, a few stand out: Coordination and implementation of the campaign was relatively poor: victims who paid reportedly did not receive decryption keys No discernible pattern to the organisations that were targeted
N
H4
N
Only three Bitcoin wallets were created for the receipt of payment An inability to monetise effectively Failed anti-sandboxing measure and race condition bug These inconsistencies are not errors we normally associate with a sophisticated cybercriminal operation. The Carbanak (AKA Anunak) organised criminal group, in comparison, are known for conducting highly-targeted, lucrative, and efficient operations, relying on the strategic use of social engineering attacks and network intrusions that more resemble the tactics used by Advanced Persistent Threat (APT) groups. H3 and H4, which posit that the campaign
RANSOMWARE ANALYSIS
was the work of a state-affiliated actor, also contain inconsistencies: If the attacks were aimed to discredit the NSA (H4), then why the lack of a supporting media narrative driving this message home? In the 2016 attacks on the US Presidential election, for example, network intrusions against the Democratic Party and subsequent data leaks were accompanied by blog posts and media commentary critical of Hillary Clinton. Were this to be a nation state campaign intended to cause disruption (H3), we would also expect to see some level of target specification alongside clear campaign objectives.
During their previous destructive campaigns, the Lazarus Group, for example, have generally displayed a consistent level of geographic targeting – primarily against organisations in South Korea and the US. Specific industries such as media companies, financial institutions, and critical national infrastructure have been the main targets of attack, but in the case of WannaCry, infections were widely distributed across the world, and the malware appeared to spread virtually indiscriminately with no control by its operators. Had the attackers used a phishing vector, they would have been able to limit the malware’s capability to spread outside a network, and instead used
spear phishing emails to target selected organisations. Such tactics would have been more consistent with the activities of a sophisticated criminal outfit or a technicallycompetent nation-state actor. It is entirely possible that new information will come to light in future that further supports, or even discredits, some of the hypotheses proposed in this exercise. While attribution may be exciting and fulfil our insatiable desire to put a face to the crime, perhaps what is more important in this instance is reviewing what lessons we can learn from the WannaCry campaign.
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FUTURE GROWTH
Investing in the future L SAP to build skills and knowledge worth US$ 100 million by 2022 to support Middle East youth job creation
Marita Mitschein Managing Director SAP TDI MENA
ast month, the World Economic Forum ran a programme centred on publicprivate partnerships driving economic growth in the Middle East and North Africa (MENA). During this, SAP made the announcement that it will build skills and knowledge among young talents worth US$ 100 million (AED 367.3 million) by 2022. By exchanging global best practices with World Economic Forum stakeholders, SAP said, its Dubai-based SAP Training and Development Institute has already developed skills and knowledge reflecting an“in-country value”of US$ 110 million (AED 404 million) across the region. “Middle East organisations are increasingly reliant on advanced technical skills, but there is a major mismatch between the current level of talent and the skills needed by 2020. The World Economic Forum is a vital platform for showing how public-private partnerships can drive technology knowledge transfer to support youth job creation across the Middle East, and transform lives and businesses,” said Marita Mitschein, Managing Director of the SAP Training and Development Institute. Showing the potential, cloud, analytics, mobility, and social media skills are posting double or triple digital growth in the Middle East, according to recent Oxford Economics report ‘Workforce 2020’.
Training initiatives support the creation of sustainable work opportunities The unique training programmes of the SAP Training and Development Institute present its participants with the opportunity to learn and get certified on cutting edge enterprise applications, and benefit from ‘soft skill’ workshops, such as Design Thinking, through a blended learning approach, giving them a substantial advantage over the market competition.
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Its flagship initiative, SAP’s Young Professional Programme, is a two to threemonth bootcamp, designed to prepare local youths for their future careers. More than 1,075 participants across 12 countries have graduated from the programme as SAP Associate Consultants, of whom 98 per cent have subsequently been placed with SAP’s customers and partners. “SAP’s Young Professional Programme is not an education for professional life exposure only. It’s indeed an experience of a lifetime, which supports every aspect of career, family, and personal development and growth,” says Rayah AlDhanani, a UAE national who graduated from the programme in 2016, and now works for Etihad Airways. In the Kingdom of Saudi Arabia, SAP Training and Development Institute has written plenty of success stories, and helped young Saudi nationals to kick-start their careers. “Graduating from the programme opened many opportunities for me to enter the market, and I was able to build my own brand and distinguish myself from the other candidates. What is better than to invest in the new generation to raise their country into a better place?” says Haitham Abduljabbar, who now works as a Functional Analyst at Johns Hopkins Aramco Healthcare. Not only does the institute train and enable talented local minds, it also supports them to enter the corporate workforce or establish their own companies. In Palestine, nine Young Professional Programme graduates have become a vital asset for local SAP partner Synergy. After finishing their threemonth training programme, they successfully implemented SAP Business One, a business management software solution, at Al-Jebrini Group, empowering it to manage its activities using a single digital application. Enabling universities to transform their curriculums to meet the needs of the Digital Economy, SAP’s Dual Study programme is currently offered at 11 selected universities across MENA. The programme gives students the opportunity to undertake major-specific SAP training and certification alongside their academic studies. Taking Middle East best practices global, the SAP Training and Development Institute has launched its Young Professional Programme in Brazil, Mexico, Argentina, and Spain.
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