MHD SUPPLY CHAIN
CREATING AN UNFAIR ADVANTAGE Peter Jones, Founder of Prological, explains how the logistics consultancy is reinterpreting the supply chain rulebook to give its customers a competitive edge.
Peter Jones, Founder of Prological.
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ack in 2003, LG Electronics (LGE) had just rebranded from Lucky Goldstar and required an overhaul of its national supply chain operations. Founder of Prologocial, Peter Jones and his team of conusltants were tasked by Tony Harris, National Supply Chain Manager for LGE, with creating solutions to support the company’s businesses aspirations in the Australian market. In parallel with setting up new distribution facilities around Australia was a total redesign for LGE’s freight operations. After several months of work, transport options were narrowed down to two candidates: the established McPhee Transport and a relatively new business unit within TNT, known as Speciality Services. To help Peter’s team make this decision, LG sent its head of supply chain for APAC, Leonardo Kim to Australia. Leonardo’s name was born from his first expat role in Spain, and it was proudly displayed on all of his business cards. “McPhee Transport, having worked with Sony, Panasonic and several other White and Brown goods brands was a known entity we could take to the bank without risk,” Peter says.
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“TNT Speciality Services was more of an up-and-coming business without the maturity of McPhee within this sector, but under Andrew Lysaght’s leadership was able to do things advantageous to LGE.” After carefully examining all processes from both transport companies, Peter came to a decision. “I said to Leonardo, ‘I know McPhee transport is a very low risk proposition,’ but he had a different approach all together,” Peter says. “Leonardo turned to me and said, ‘If we go the same way as everybody else, the best we can be is the same as everybody else and we can never be better than that.’” TNT Specialty Services’ work for LG made up 20 per cent of its business unit volume, at the time allowing the emerging business unit to develop unique capabilities off the back of LG’s volume, according to Peter. Combined with an equally unique approach with Allied Express for national metropolitan distribution, LG Electronics Australia quickly grew to 8 per cent of LGE global sales. “Life was Good for LGE customers as well as us consumers who bought the products by the ship load,” Peter adds. The success of this project birthed Prological’s philosophy of “creating an unfair advantage,” that is, implementing supply chain solutions which place customers ahead of their market competitors.
SOLUTIONS TO TODAY’S PROBLEMS Peter draws inspiration from engineer and designer of Formula One racing cars Gordon Murray when assessing solutions to modern day supply chain problems. Working with the Brabham team, which was owned by Bernie Ecclestone
at the time, Murray designed the BT46 “fan car.” The vehicle was driven by a complex series of clutches running from the engine to a large single fan at the back of the car, so the faster the engine ran, the stronger the fan would suction. The car won its debut race at the Sweden Grand Prix in 1978 but so superior was this innovation that Brabham themselves withdrew it from the rest of the season amid concerns over their “unfair advantage” ruining the competition. “It’s an example of someone remaining within the rulebook but
