MHD May-June 2019

MHD Supply Chain Solutions MAY / JUNE 2019 COVER STORY

THE FUTURE IS DATA

AI will steer supply chains into a data-driven future

PROCESS SUSTAINABILITY

The test of all good transformation programs

IN FOCUS

IT IN THE SUPPLY CHAIN: LOGISTICS INNOVATION AND TECHNOLOGY

Deal with demand Maximising man and machine in the modern warehouse

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MHD FROM THE EDITOR

MHD Supply Chain Solutions CONTACT MHD Supply Chain Solutions is published by The Intermedia Group Pty Ltd ABN 940 025 836 82 41 Bridge Road, Glebe NSW 2037 Telephone: (+61) 02 9660 2113 Fax: (+61) 02 9660 4419 Email: mhd@intermedia.com.au

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THE MACHINES ARE COMING!

S

omewhat interestingly in an increasingly overpopulated world, finding good workers is becoming increasingly difficult for many industries.

Now whether this is due to the preference for importing already trained workers (under whatever visa numbers) and simultaneously decimating vocational training (TAFE), instead of training our own, or the digital economy placing ever-increasing demands on personnel – after all, home delivery takes a lot more labour than serving customers in a shop – I cannot tell. But for those few who have been lucky enough to receive good education and have numerical brains, robotics and automation opens a new field of Eden.

Our regular contributor Mal Walker’s visit to America’s principal warehouse equipment showcase Promat 2019 demonstrates, the warehouse workers in the future will be few in number, be served by ‘cobots’ and watch autonomous vehicles run around the warehouse rather than having to hop on a forklift themselves. You can read Mal’s report on page 36.

Even that ubiquitous demander of spare hours the regular cycle count is increasingly being done by – wait for it – unmanned aerial vehicles, or UAV!

THE SOFTWARE TO DRIVE THE MACHINES Of course, machines cost money and you don’t expect your autonomous robots and UAV to have to be driven by a warehouse worker mangling a remote control.

As the introduction to our Cover Story establishes, (“Maximising man and machine in the modern warehouse: how embedding WES and Order Streaming in a WMS changes everything”), the clever people at Manhattan Associates have tweaked the venerable WMS to champion over the task of new-age order fulfilment and warehouse management. As they say: “As e-commerce trends continue to emerge and impact supply chains, supply chain leaders must find ways to modernise their DC operations in order to remain competitive in the face of new pure-play e-commerce start-ups, international brands, and other omnichannel enterprises. Advancements in technology, equipment, and operational best practices will certainly provide opportunities and inspiration.”

Read more from page 12 and in general, enjoy reading your MHD magazine as always!

Charles Pauka Editor charles@intermedia.com.au

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MHD MAY / JUNE 2019 | 3

DELIVERING MORE THAN JUST FORKLIFTS. THAT’S THE TOYOTA ADVANTAGE.

ELEVATED WORK PLATFORMS

COUNTER-BALANCE FORKLIFTS

WAREHOUSE EQUIPMENT

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BURDEN CARRIERS

SWEEPERS AND SCRUBBERS

MAY / JUNE 2019

ISSUE #3 VOLUME 49

THIS ISSUE COMMENT

COVER STORY

06 All roads lead to working capital 08 Technology => efficiency 10 Why businesses must take a risk management approach to supply chain security

IN FOCUS: IT IN THE SUPPLY CHAIN: LOGISTICS INNOVATION AND TECHNOLOGY 16 Join the network

12

18 Moving with the times 20 The future is data

34

22 Crisis control 24 Accelerate your profitability 26 Mobile transformation 28 Bring down the walls 30 7 reasons 31 The Amazon effect 32 Back in control 34 The distribution centre of the future 36 Spotlight on: Promat 2019 38 Need to know 39 Digitise to win

SUPPLY CHAIN 40 Process sustainability – Part 1.

43 Stop the nightmare 44 Reducing the haystack

DEPARTMENTS AND REGULARS 33 Subscription information 45 Materials handling and management 48 ASCI – contacts, courses, news

ON THE COVER How embedding Manhattan WES and Order Streaming in the WMS changes everything. See page 12

47

50 From the Supply Chain and Logistics Association of Australia

MHD MAY / JUNE 2019 | 5

MHD COMMENT

ALL ROADS LEAD TO WORKING CAPITAL SEAN WILES AND MARTIN SEWARD

“

We recommend having an appropriate funding structure, which gives management teams the liquidity and flexibility to run their businesses.

”

6 | MHD MAY / JUNE 2019

W

hen assessing the financial performance of a businesses, it is commonplace for management teams to only think about revenue and earnings. Analysts scrutinise and rate companies on their profitability, owners link dividends to earnings, and executives,

- and that customers pay on or before the invoice due date. Similarly, on the supplier side, paying late or stretching creditors is not sustainable, however, there is generally no good reason to pay early, unless there is a discount on offer and even then, that discount must be better than the financing

sales and operational staff are typically incentivised through bonus structures linked to either sales or earnings, or both.

However, this approach neglects one key aspect of what makes a business tick: cash flow. Sales and earnings do not mean much unless they can be converted into cash, quickly, and to do this companies need good working capital management. The shorter a business’s working capital cycle, the better its cash flow, and the more flexibility it has in making business decisions.

McGrathNicol Advisory recently explored the working capital cycle of a sample of 146 ASX listed companies across nine sectors, including the transport and distribution sector. It found that this sector experienced the greatest deterioration in working capital performance in 2018, with all but one of the sampled companies having lengthened their working capital cycles.

At a macro level, transport and distribution is typically an industry where cash flow can come under pressure from business-critical suppliers (e.g. fuel, subcontracted labour, warehousing) that are unlikely to extend credit for long periods, exacerbated by large retail, mining and manufacturing customers imposing high levels of bargaining power.

Despite these forces, we believe there is a twofold solution to improving the working capital of companies within this industry.

Firstly, a disciplined approach to working capital management is required to ensure cash flow is optimised and any residual ‘funding gap’ is well understood and minimised.

This may sound simple but clear procedural steps are required to ensure that accurate invoices are raised as quickly as possible

rate than having the cash in the business’ own bank account. Clearly setting out the steps in the procurement-to-pay cycle and assigning responsibilities help ensure suppliers are paid on time and no earlier.

Secondly, we recommend having an appropriate funding structure, which gives management teams the liquidity and flexibility to run their businesses.

This part of the solution has not always been well understood by transport and distribution companies, particularly when it comes to the type of financing arrangements available to further reduce their ‘funding gap’. However, American Express is seeing a growing take-up of business credit and charge cards by savvy business owners wanting to extend the settlement timeframe on supplier payments, with this sometimes providing up to 55 days of extra cash flow, giving owners the extra breathing space they seek whilst also allowing them to earn rewards points.

Many of American Express’ transport and distribution clients can have a funding gap of around 20 or 30 days. In some cases, full payment for services isn’t received until completion of contract and this can make things very tight, especially for businesses operating on thin margins.

Getting working capital right can be challenging for operators in the transport and distribution sector, but those that do can carve out a real competitive advantage and set themselves up for long-term success.

Sean Wiles is partner at McGrathNicol Advisory and Martin Seward is vice president and general manager at American Express Global Commercial Services. ■

EFFICIENT GOODS-TO-PERSON PICKING Goods to Person order picking systems provide high productivity and space efficiency.

Flexible warehouse management software gives you visibility of performance, and puts you in control. ssi-schaefer.com

MHD COMMENT

TECHNOLOGY => EFFICIENCY BART DE MUYNCK

Mobility technology drives transport efficiencies

G

overnment regulations requiring greater compliance, the increasing need for visibility into the status of shipping loads, and an increasing responsibility for driver safety continue to drive demand for mobility technology in transport. It remains a top technology investment, according to a recent Gartner supply chain survey.

At the heart of mobile technology for transport is telematics, which is used to monitor a wide range of information relating to an individual vehicle or an entire fleet. Fleet operators can locate and track the movements and monitor conditions of assets in real time, using mobile or satellite links. This gives them visibility into exact vehicle locations, engine performance, fuel usage, hours of operation, maintenance problems, cargo temperature, and tampering alerts via onboard sensors.

Fleet operators can also track drivers to ensure safety and performance. The analysis of driver performance results in improvements in fuel consumption, prevention of workers’ compensation claims and accidents. This leads to lower operating costs, higher compliance, safety and accountability (CSA) scores and, possibly, lower insurance rates.

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All of these factors help improve customer service, routing, safety, vehicle maintenance and productivity.

It also helps organisations cut costs, reduce and mitigate risks, boost revenue and decrease fuel consumption.

WHAT ARE THE DIFFERENT SOLUTIONS? There are three main types of commercial telematics systems to consider for your fleet’s needs: 1. OEM-embedded. An onboard computer, also known as a fleet box, is installed during the manufacturing of new vehicles

by OEM, such as Mercedes-Benz Fleetboard, Scania Communicator, Volvo Dynafleet and MAN TeleMatics. These systems are capable of engine management and tele-diagnostics. Unfortunately, fleets only replace a small percentage of their vehicles on an annual basis, so this option wouldn’t allow an immediate upgrade for an entire fleet.

2. Aftermarket-installed. These systems are at the origin of commercial telematics. The hardware varies from very expensive onboard computers to plug-and-play devices. The main advantage is that they can be installed on almost any vehicle in the fleet, new or old. The purchase of these devices is also

independent of the procurement of the vehicles. Aftermarket products will continue to dominate the market, especially in the overthe-road segment. They will also, in many cases, complement OEMembedded systems.

3. Portable. Portable telematics systems don’t need to be installed and are easy to use. Personal digital assistants (PDA), portable navigation devices (PND), smartphones and tablets can be used as portable telematics systems. So, even smaller fleets can compete with their larger competitors. There are also systems that purely use mobile devices to track the vehicle and driver via GPS positioning. Although these systems serve many uses, they can’t be used by fleets to satisfy some government mandates.

Use these telematics in combination with your current routing or other fleet management tools. As more data is collected through these mobile systems, analytics can be used to offer better visibility for both the fleet operator and the shipper.

Adoption of telematics systems is also increasingly growing beyond direct usage in the vehicle or cab, such as in trailers, containers, rail wagons, school buses, local government vehicles, industrial equipment and heavy machinery.

MARKET CONTINUES TO EVOLVE The transportation mobility technology space continues to grow at approximately 20 per cent per year, fuelled by aftermarket and OEM telematics products.

As these have evolved, they’ve become more affordable and effective. The cost of devices, as well as the communication costs, have come down significantly. Most products are also offered on a subscription basis, which means they are no longer limited to larger fleets - smaller fleets can start using them to provide value to their organisation and customers.

Additionally, the increasing penetration of long-term evolution (LTE) technologies and high-speed broadband around the world continue to bolster the demand for commercial telematics in the global market.

With 5G networks expected to roll out in the next few years, this will impact the type and amount of data that can be exchanged.

If you haven’t already, now’s the time to invest in transport mobility to ensure compliance with government mandates, ensure productivity for the fleet, and obtain tools that enhance customer visibility and

“

The advantages that can be gained will drive your fleet’s efficiencies and increase customer service.

”

fleet maintenance. The advantages that can be gained will drive your fleet’s efficiencies and increase customer service.

HOW TO GET STARTED • Adopt vehicle-tracking systems when the pain of empty loads, idle drivers and ‘lost’ assets visibly affects customer satisfaction or operating efficiency for fleet operators.

• Implement technology to further enhance driver safety and driver and vehicle performance, via real-time monitoring.

• Evaluate off-the-shelf and portable products that support your business needs.

• Explore whether newer, less-expensive systems justify a switch from current transport mobility technology, or extend usage by using new functionality and integrating the technology into other execution and analytics systems.

Bart De Muynck is a research vice president at Gartner, specialising in supply chain delivery processes such as transport planning, commercial telematics, freight payment, analytics, vehicle routing and scheduling. For more information visit www.gartner.com/supplychain. ■

FUTURE-READY AUTOMATION: FLEXIBLE,ROBOTIC, DATA-DRIVEN

swisslog.com

ROBOTIC, DATA-DRIVEN & FLEXIBLE AUTOMATED SOLUTIONS At Swisslog, our scalable future-ready automation systems and SynQ warehouse management software are designed to give you the insight and flexibility you need to meet your company’s changing demands. So they’ll make as much sense tomorrow as they do today.

MHD MAY / JUNE 2019 | 9

MHD COMMENT

MANAGE RISK

Why businesses must take a risk management approach to supply chain security

ILAN RUBIN

O

rganisations that use supply chains need to be aware of the cybersecurity risks created by vulnerabilities in upstream or downstream partners. Often, the lack of security is unintentional. A supplier may unknowingly leave security gaps in information, which is then incorporated into the organisations’ systems and may be exploited by malicious hackers.

It’s essential for organisations to work closely with their supply chain partners to overcome these challenges, and to secure the supply chain.

Chief information security officers (CISO) and other leaders responsible

10 | MHD MAY / JUNE 2019

for security can be forgiven for being frustrated by their limited control over supply chain activities. Supply chains tend to be dynamic, highly complex, and fluid. And with no easy way to predict where an attack might come from, this makes the job of securing the organisation even harder.

This challenge is equally confounding for small and large businesses. While small organisations don’t tend to have the required resources to conduct due diligence throughout the supply chain, large organisations tend to have such disparate and complex supply chains that conducting due diligence is similarly challenging.

However, the more complex the supply chain, the more important it is to have a strong security foundation. And, even though CISO can’t necessarily control all the actions of supply chain partners, they’re still responsible for securing the organisation, so they must pay careful attention to the supply chain.

CISO should start by creating a risk management plan pertaining to the supply chain before determining on what areas to focus and where some risk may be acceptable. Characterising risk based on its consequences is a useful way of determining what is acceptable and what must be mitigated. Organisations can then start to plan their security measures.

Organisations should protect information based on its value. This means it can segment its assets to protect the crown jewels more effectively and without wasting resources. This approach can also restrict the scope or spread of compromised supply chain systems.

Open up a conversation with all partners about supply chain risks and security best practices to ensure that everyone in the supply chain is working towards the same goal of security. This can help overcome factors such as human error, which is often a significant contributor to data breaches.

Just by being aware of the need for security best practices, organisations can reduce the risk of people inadvertently creating vulnerabilities.

While mitigating the risks across the supply chain can seem overwhelmingly difficult, it is essential to take a risk management approach that minimises the dangers. This might involve incorporating a security fabric approach, which delivers broad protection and visibility to every network segment, device, and appliance, whether virtual, in the cloud, or on-premises.

Ilan Rubin is the managing director of Wavelink, distributor of Fortinet security applications. For more information email sales@wavelink.com.au, call +61 3 9832 4444 or visit www.wavelink.com.au. ■

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DEMAND

Maximising man and machine in the modern warehouse: how embedding WES and Order Streaming in a WMS changes everything

T

he impacts of digital transformation and connected commerce are resounding across industries. The roles of manufacturers, wholesalers, retailers, employees, technology and robotics are all rapidly transforming in today’s evolving e-commerce landscape. Changing consumer behaviours and new digital initiatives have also changed the game for distribution centres (DC) and supply chains, which are now expected to skilfully handle large B2B wholesale orders, retail store replenishment orders, as well as urgent, small e-commerce orders.

Some of the biggest shifts in expectations of the DC and supply chain are inline with the flexibility that consumers now expect from e-commerce. Manhattan Associates recently conducted research that revealed 56 per cent of Australian consumers would stop shopping with a retailer that doesn’t offer flexible returns options, and 71 per cent check to see if a retailer offers flexible delivery methods such as home/office delivery, parcel pickup lockers, clickand-collect and express delivery, before shopping online with them.

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Today’s supply chain and warehouse need to keep up with a much more demanding omnichannel landscape, which will likely continue to grow more demanding as technology advances and competition rises.

KEEPING UP WITH THE CHANGING INDUSTRY Under pressure from rising consumer expectations, forward-thinking companies around the world are challenging themselves to serve more customers, more quickly, more directly and more personally. And these companies realise that omnichannel distribution projects aren’t just an issue for the consumer-facing retailer end of the business – it is also very much down to supply chains and warehouses to keep up.

In an effort to keep up with the omnichannel, distribution leaders are making unified channel fulfilment a key goal, because it delivers a holistic approach that is capable of factoring in the complexities and uniqueness associated with each individual channel.

Supply chain leaders are now taking note of the benefits other businesses have gained with this approach and

are taking action. They have realised it’s no longer acceptable to operate channels with segregated warehouse space, duplicative inventories, excess labour, and redundant automation.

All of these assets are expensive and in order to improve throughput, profitability and customer satisfaction, maximum utilisation is critical. There needs to be continuous optimisation and orchestration of order fulfilment activities across all assets and all channels. That’s why advanced warehouse management systems (WMS) must now also feature an embedded Warehouse Execution System (WES) and Order Streaming capabilities.

WAREHOUSE EXECUTION SYSTEM The trend today is that more and more organisations are going down the multi-channel fulfilment route. Tasked with handling more SKU, greater numbers of smaller, more frequent orders, across more channels – all with shorter processing times – distribution centres are under constant pressure.

Rising demand for human labour and resulting labour shortages are driving many warehouses to investigate

MHD COVER STORY

advanced automation and robotics. The appeal is obvious: automation is not impacted by regional workforce capacity, robots do not get fatigued, injured or sick, and they can work around the clock. Robots are also safer in some cases, helping to manage large, heavy, or hazardous loads to protect both worker health and the company’s liability.

DC robotics are getting more efficient, more sophisticated and faster than ever before, with innovations coming from vendors around the world. The challenge is that different types of automation do not naturally communicate and are often not aware of each other, much less the supporting workforce. In order to get maximum throughput within the DC, the various types of automation need to work together.

“

More than ever, warehouse management must be approached with a holistic perspective that considers any combination of human and automation together.

”

Previously, there was no standardising of systems and no limitation to the amount of automation – when supply chain leaders introduced automation, they were forced to work with various systems: a warehouse management system (WMS), or warehouse control system (WCS), as well as a warehouse execution system (WES).

The systems worked independently of each other and remained largely siloed, meaning fulfilment organisations actually had to work harder to ensure inventories were not duplicated, and resources were maximised.

These legacy WMS were never designed to continuously manage the capacity and throughput across advanced automation, robotics and humans. Now, with fulfilment across multiple channels, supply chains need a lot more flexibility.

“The challenge for the supply chain is that it has multiple flows coming from all the different channels,” said Raghav Sibal, managing director at Manhattan Associates, ANZ. “This has created a need to optimise the flow of products through different channels, as throughput needs to be measured and optimised through each area of the warehouse to be able to maximise the overall efficiency of the operation, with the WMS integrating all systems used in all areas.”

Today, the WES module needs to be built inside the WMS, rather than being patched on later from the outside. Eliminating siloed integration challenges, a WES embedded into the WMS provides a comprehensive, coordinated approach that gives complete command and control of the warehouse. >> MHD MAY / JUNE 2019 | 13

“

The challenge for the supply chain is that it has multiple flows coming from all the different channels.

”

Many operations have both human and automation in the warehouse, and whilst automation can be optimised at maximum capacity, a bottleneck is often created in other areas. WES inside the WMS will optimise throughput through each zone or area in the warehouse, both automation and human, in order to maximise the efficiency in each area. The system is able to take into account how long an order has been sitting, as well as orders going through goods-topurchase, to prevent a bottleneck occurring upstream or downstream, and ensuring operations are optimised.

A fully integrated WMS should work seamlessly with any type of automation, allowing robotics providers to simply plug in to the new system and be up and running quickly.

ORDER STREAMING In a further effort to take charge of omnichannel management and success, many supply chain leaders are looking to Order Streaming, a sophisticated approach to order fulfilment. Order Streaming helps the DC operate with increased speed and flexibility by breaking down the boundaries between wave (bulk orders) and waveless (smaller e-commerce orders continuously streamed) fulfilment. It allows warehouses to use multiple processes to efficiently fulfil orders of any size or type rapidly from a DC of any size or type — both smaller, local, quickresponse facilities, as well as larger, regional, high-volume, automated e-commerce sites.

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Australia Post’s 2018 E-commerce Industry Paper revealed that in 2017 online spending saw a growth of 18.7 per cent, while traditional retail saw a growth of only 2.5 per cent. Additionally, Australia Post predicts that by 2020, one in ten items will be bought online. With this growth, Order Streaming will become more important in the supply chain to keep up with the increased volume and smaller pick orders from e-commerce.

Order Streaming is a waveless approach and allows smaller orders to be incorporated into the flow without disrupting the efficiency and productivity of the warehouse.

Rather than batching orders and dropping them into the DC operation in waves, which will slow down production as smaller or single-product orders have to sit and wait until they can fit into a batch, Order Streaming continuously evaluates the order pool and automatically releases work based on variables such as order priorities and facility processing capacities.

MHD COVER STORY While many types of orders and operations are best served by batch-wave processing, development of a waveless approach has been necessary to respond to growing omnichannel fulfilment promises. Waveless manages every order as a discrete allocation of work, enabling fast, responsive fulfilment for smaller, more urgent orders. It is ideal for direct-to-consumer order fulfilment.

“Order Streaming gives distribution centres the ability to process urgent e-commerce orders throughout the day without disruptions, which is only going to be more important as e-commerce continues to grow and delivery timeframes shrink,” Mr Sibal said.

Another key benefit of Order Streaming is that the system allows retailers to accept online orders later in the day, while still allowing them to turn around and ship orders quickly (often in the same day).

Whether a warehouse relies on a combination of manual and partially automated processes, or a fully automated, robotic system, Order Streaming supports the requirements of adaptive, changeable fulfilment and delivery. Today’s trends toward sophisticated autonomous robotics open an exciting set of opportunities for Order Streaming and its impact on business strategies.

ALLOWING FOR FUTURE GROWTH

ACHIEVING OMNI-CHANNEL SUCCESS Manhattan Associates’ customer Country Road Group completed a successful roll out of Manhattan’s WMS. The technology deployment was a key component of a business transformation project designed to deliver a unified brand experience for customers across channels and to drive ongoing business growth.

Country Road Group’s business and sales channels have evolved in complexity and scope as the company expanded its operating footprint. With over 700 stores and a growing online operation, the retailer had outgrown its outsourced logistics services model and recognised the critical need to take greater command of its supply chain. The company made the strategic decision to invest in a new DC and chose Manhattan’s system to orchestrate goods flows through the new DC.

Head of supply chain Australasia, Country Road Group/David Jones Peter Fouskarinis commented: “The Manhattan solution has enabled us to optimise our store replenishment and online order fulfilment processes, resulting in improved product availability and customer satisfaction.”

The Manhattan system’s advanced fulfilment logic for wave management, constraint-based selection and real-time replenishment has been critical in helping Country Road Group realise its omni-channel commerce goals. The system eliminates costly physical counts with auditor-approved cycle counting, and stores can now provide same day fulfilment as a result of a new cross-docking approach.

Watch the Country Road case study video at www.manh.com.au/ resources/videos.

More than ever, warehouse management must be approached with a holistic perspective that considers any combination of human and automation together.

Coordination and collaboration across discrete pieces of advanced automation – as well as the human workforce – only gets more powerful when those systems are integrated with each other. The combination of an embedded WES and Order Streaming capabilities makes today’s advanced WMS one that enables total visibility across the DC, complete flexibility for automation growth, as well as continuous analysis and maximum utilisation of all resources.

As e-commerce trends continue to emerge and impact supply chains, supply chain leaders must find ways to modernise their DC operations in order to remain competitive in the face of new pure-play e-commerce start-ups, international brands, and other omnichannel enterprises. Advancements in technology, equipment, and operational best practices will certainly provide opportunities and inspiration.

For more information contact Manhattan Associates on +61 2 9454 5438, email anzinfo@manh.com or visit www.manh.com.au. ■ MHD MAY / JUNE 2019 | 15

JOIN THE NETWORK Make your supply chain work effectively with GS1 Australia’s Network of Solution Providers

A

s commerce, in general, has become more competitive and advances in technology continue at breakneck speed, an efficient supply chain is crucial for the survival and success of your business.

With Industry 4.0, the suite of new technologies such as artificial intelligence, robotics, sensor technology and data analytics are transforming how businesses operate with their trading partners and consumers. Australian businesses can make their supply chains more efficient by reducing costs and boosting their competitiveness. Many of these technologies are underpinned

by GS1 standards, the most widely used supply chain standards in the world.

While most companies are aware that ‘supply chain improvements’ are needed to drive efficiencies across the whole of their business operation, managers and business owners often don’t have enough expertise to start implementing practical steps.

GS1 Australia’s extensive Network of Solution Providers is available to help member businesses implement GS1 standards quickly and accurately, from barcode labelling through to data warehousing.

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ONE-STOP SUPPLY CHAIN SOLUTIONS PROVIDER NETWORK Introduced more than ten years ago, GS1 created the Alliance Partner program to connect business members with solution providers that have a thorough knowledge of the GS1 system and to share its vision of delivering tangible supply chain benefits for its members.

Today, around 20,000 business members from more than 20 industry sectors can take advantage of the pool of knowledge and expertise within the Alliance Partner community. All partners in the network are trained in GS1 standards and implementation across a range of industry sectors including retail (apparel, general merchandise and food & beverage), healthcare, freight and logistics, and rail.

The GS1 community offers businesses a complete suite of products and solutions to help them build efficient and effective supply chains, from barcoding of products (printers and labels), software like Electronic Data Interchange (EDI) messaging for purchase orders and invoices and Enterprise Resource Planning for procurement of goods, through to data warehousing and warehouse management systems (WMS).

Some further benefits that the GS1 Alliance Partner community can bring to a business include: • Value-added tools and resources to complement and enhance the GS1 system.

• Access to the latest information on supply chain products and services, some of which is global by nature.

• Ongoing support to help businesses continue to innovate and extend their supply chain efficiencies.

Additionally, GS1 partners have expertise in helping companies improve visibility across their supply chain as implementing traceability and anticounterfeit measures is a key challenge facing manufacturers and their suppliers.

FINDING A SOLUTION PROVIDER Businesses have many opportunities to connect with the Alliance Partner community and find the right solution provider for their needs. To help businesses readily find GS1 partners, the Solution Providers Directory is available at www.gs1au.org/what-wedo/solution-providers/find-a-solutionprovider. Visitors can search for a provider and contact them directly by submitting the short request form.

From the directory you can view a description of the solutions offered by each of the Alliance Partners, together with their contact details and a link to the company website.

Business members can also meet face-to-face with many of the Alliance Partners exhibiting at events and training sessions hosted by GS1 Australia across the country. One of the key networking opportunities for businesses to connect with the Alliance Partner community is at GS1’s premier conference, NEXUS, which is held every two years and brings together supply chain leaders from industry, government trade associations and the GS1 business member community. Additionally, the popular one-day Barcode Basics for Your Business is held regularly and is available for GS1 business members and non-members.

With the pace of change in business showing no signs of slowing, connecting and consulting with a GS1 Alliance Partner can help improve your business efficiency, profitability, safety and security.

For more information about GS1 Solution Providers or if you’re interested in becoming an Alliance Partner, email alliances@gs1au.org or visit www.gs1au. org/what-we-do/solution-providers. ■

Creating a data warehousing model that delivers real value, in real time

MOVING WITH THE TIMES PETER O’CONNOR

D

ata warehouses are far from new. The term itself was coined back in the 1970s, and repositories for data amassed from a range of sources that can be used to inform business decisions have been part of Australia’s corporate high-tech landscape for almost as long.

With data analytics and artificial intelligence (AI) the primary foci for organisations of all stripes and sizes, it’s an opportune time for businesses to review their data warehousing strategies, to ensure they’re well positioned to support burgeoning demand for insights.

Here are some tips for maximising the value of the data warehouse.

1/ ADOPT AN ‘AS-ASERVICE’ MODEL What’s the primary role of your data warehousing team? Is it to manage infrastructure or to support the development of data programs that drive efficiency and profitability across the enterprise? If you haven’t yet adopted an ‘as a service’ model, you’ll likely find it’s the former. Management and administrative tasks – think partitioning, scaling, maintenance, back-up scripts and the like – are likely to consume a significant portion of your team’s time. As a result, there’s less time for them to work 18 | MHD MAY / JUNE 2019

on projects that add value to the enterprise. Adopt an as a service model and all that changes. Data and service protection, database management and security are taken care of, leaving staff free to focus on exploiting data to help the organisation succeed.

2/ BROADEN YOUR HORIZONS Data no longer comes in two flavours – structured and semi-structured.

If your organisation is not ingesting data from a wide variety of sources – enterprise applications, mobile applications, the internet, APIs and the Internet of Things (IoT) – then you’re at the back of the pack. Today’s data integration technology makes pulling these data sources together to exploit the insights they contain a much more straightforward matter than once it was.

3/ IMPLEMENT SELFSERVICE DATA ANALYTICS Historically, data analytics was the remit of small specialised teams within organisations. If business units wanted queries run or information analysed, it was a matter of lodging a request and waiting for the results to be returned. Delays were a common but unavoidable occurrence.

User-friendly data analytics software has turned this model on its head.

An increasing number of Australian

enterprises are adopting a self-service model, whereby employees are given access to the data warehouse and provided with tools to extract insights for themselves.

The benefits of democratising data in this way can be significant.

Bottlenecks can be minimised and results extracted and acted upon more quickly. Conversely, businesses that fail to throw open the data warehouse risk being left behind, as their more nimble counterparts gain a competitive ‘information advantage’.

4/ FOSTER A DATA DRIVEN CORPORATE CULTURE Empowering employees to access and manipulate data is a vital step towards the establishment of a data-driven corporate culture, in which up-to-date information is used to inform every business decision.

Data-driven decision making has superseded decision making based on intuition or gut feeling in at least a third of Australian boardrooms, according to 2016 research by PwC. ICT staff can play a vital role in fostering this culture at all levels of the enterprise. Instead of acting as gatekeepers for the data warehouse, they should be regarded as trusted guides for their colleagues throughout the organisation.

MHD FEATURE 5/ CONTROL THE QUALITY If leveraging data across all areas of the enterprise is the aim – and it should be – it’s vital to ensure its quality and integrity.

Establishing a rigorous data governance regime will ensure what’s extracted from the data warehouse is clean, trustworthy and correct.

6/ EMBRACE CONCURRENCY Old-school data warehouse professionals were required to be masters of scheduling.

Their challenges invariably included finding time slots when large jobs could be run without monopolising finite processing resources and disrupting other activities.

Migrating to a cloud-based, as-a-service data warehousing model puts paid to this issue. Eliminating the competition for resources allows IT staff to run multiple jobs concurrently and deliver results and insights more efficiently to stakeholders.

7/ MEASURE PERFORMANCE Improving the efficiency of the data warehouse begins with finding the right metrics with which to measure

its performance and its cost to the organisation. It makes sense to include management overhead in the calculations.

Many tasks and procedures which require management intervention under an in-house model can be executed automatically under an as a service model.

The time savings can be considerable, over time, and should be included in any reckoning of the relative costs and benefits of the two models.

8/ DOING MORE WITH DATA In today’s digitally driven business environment, data has been dubbed the new oil. The insights it contains can help organisations become more efficient and profitable. Exploiting the full potential of the corporate data warehouse is vital to the process and Australian organisations which fail to do so may find themselves struggling to keep up with their datadriven competitors.

“

Exploiting the full potential of the corporate data warehouse is vital to the process.

”

Peter O’Connor is the vice president of sales, Asia Pacific and Japan, at Snowflake. For more information visit www.snowflake.com. ■

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THE FUTURE IS DATA AI will steer supply chains into a data-driven future

RAJEEV MITROO

T

he modern global supply chain is defined by scale: billions of transactions and terabytes of data across multiple systems, with businesses generating more every moment. Traditional supply chain management (SCM) practices are quickly being outmatched by the ceaseless onslaught of information.

Over the years, Australian organisations have deployed a broad range of transactional and analytic systems for supply chain operations.

While gains have been made, supply chains remain far from the ideal of real-time visibility and data-driven decisions that define the supply chain of the future.

When a problem arises with inventory costs or availability, financial and demand planners dive into Excel or legacy SCM tools in an attempt to pinpoint the issues. This approach is like looking for the proverbial needle in a haystack. The sheer volume, velocity and variety of data defy human efforts to understand the dynamics and steer the ship.

Supply chains have grown infinitely more complex in today’s faster digital environments. Soaring data volumes and diversity are overwhelming the relatively static and simplistic business rules of legacy transactional and 20 | MHD MAY / JUNE 2019

analytic applications. More partners, products and geographies complicate the dilemma.

As a result, too many supply chains run on guesswork decisions based on information that’s often outdated and contradictory. An inaccurate forecast, for example, can very quickly have a cascading negative impact throughout a supply chain. Companies risk delays, needless costs and revenue loss, by continuing to rely on status quo processes and decade-old software.

One of the problems is that most analytic solutions stop at the ‘understand’ stage, leaving the business user to figure out what to do. It’s important to take an integrated approach to data from across the enterprise to provide prescriptive recommendations for business users. This helps companies move beyond understanding problems to actually taking actions that improve business performance.

ENTER ARTIFICIAL INTELLIGENCE Artificial intelligence (AI) is poised to transform supply chains with breakthrough capabilities to process huge amounts of real-time data and make intelligent recommendations to usher supply chains into a truly datadriven future.

Innovative organisations are applying AI and machine learning

against vast sets of supply chain data to unearth insights into problems and performance that are effectively beyond the reach of even the most skilled planning professionals.

Organisations in pharmaceuticals, consumer packaged goods, manufacturing and other industries, see the tremendous promise that AI holds and are looking to move beyond relatively simplistic SCM tools built on static business rules that inhibit the ability to optimise and scale.

German pharmaceuticals firm Merck, for example, plans to deploy AI and predictive analytics throughout its healthcare division’s entire supply chain by the end of 2019. The company is currently using analytics software to mitigate supply shortages, predict spikes in demand and bottlenecks with about 100 products related to fertility drugs. The company plans to expand its pilot program to 5,000 products by the end of this year, which will add significant competitive advantage.

Closer to home, the Australian Government is getting behind local businesses to support projects with a specific focus on AI, committing $25 million in additional funding for the Cooperative Research Centres Program.

Developing Australia’s AI capability will support business innovation by enabling SME to develop and leverage new technologies, products, processes

MHD FEATURE ATP is just one example. AI’s powerful cognitive automation capabilities can be applied to all supply chain processes, from demand and supply forecasting to inventory optimisation, manufacturing performance, procurement automation and supplier reliability assessments.

GETTING STARTED WITH COGNITIVE AUTOMATION

and services for global supply chains, ensuring Australia is a world leader in competitive global markets.

A SMARTER SUPPLY CHAIN How will intelligent supply chains actually work? Rather than the limiting rules of traditional software, AI relies on machine learning algorithms to learn and refine in real time as it crawls internal and external data sets. That could include inventory data, supplier performance, demand fluctuations, and even weather or road conditions.

AI combines this disparate knowledge to make recommendations or decisions on optimal actions. Think of it almost as a self-driving business based on cognitive automation — the ability to learn, think and take actions.

Take the available-to-promise (ATP) function, which is an important concept in supply chain management that responds to customer order inquiries based on resource availability. In traditional software, ATP is fundamentally a rules-based calculation based on theoretical lead times and allocation rules that are incredibly variable and volatile. Using those data points in ATP calculations can result in wrong ATP dates.

In contrast, AI can automatically generate a ‘supply chain map’, showing everything about an order, including allocated quantity and expected delivery date. It delivers highly accurate recommendations and predictions based on machine learning and data science, not simple rules-based ATP calculations.

“

Despite the hype around AI, it’s already delivering the insights and optimisations that many supply chains desperately need.

”

The AI-driven supply chain is a journey — and like any journey, it needs a roadmap and a driver.

Supply chain managers at innovative companies like Merck move through five key levels on their way to intelligent, datadriven operations: 1. Understanding: leverage AI to fully understand the true operative states of your supply chain.

2. Recommendations: use the AI system f or recommendations on key risks and opportunities.

3. Predictions: gain insights with predictions and probabilities based on AI’s continuously evolving machine learning.

4. Augmented decisions: AI suggests optimal decisions that require human review and approval.

5. Autonomous decisions: AI makes decisions autonomously without human intervention.

Moving through various levels of understanding and decision making, supply chains can ultimately reach completely autonomous decision making, leaving room for experts and managers to focus on strategy and growth. So where should you start?

First, think through specific uses for applying AI in your supply chain, whether it’s demand forecasting, inventory planning, manufacturing, or ATP/CTP (capable to promise) optimisation. From there, assess each of the business rules for those disciplines and how to make them more algorithmic with data science.

Once you’ve mastered the basics, it’s important to operationalise AI into your business. AI cannot be a side project — when done right, it should be embedded within your processes.

Despite the hype around AI, it’s already delivering the insights and optimisations that many supply chains desperately need.

By embracing it vigorously, we enter a brave new world with boundless possibilities for supply chains to run as efficiently as proverbial clockwork.

Rajeev Mitroo is managing director of Asia Pacific for Aera Technology. For more information visit https://www.aeratechnology.com. ■ MHD MAY / JUNE 2019 | 21

MHD FEATURE

CRISIS CONTROL DANIEL KOHUT

How fast can your supply chain respond to changes in customer demand and adapt to external influences? The answer is in the data

W

e live in a world where the customer is still king and keeping up with the changes in demand for goods is fast becoming the most important competitive differentiator for companies across the globe. Combine this with volatile weather patterns and the prominence of social media, and the result is a supply chain process for businesses everywhere that can often be under huge pressure to adapt to a new environment in a matter of minutes.

You may know what I’m talking about when I say it feels like you need a built-in crisis control tower for your supply chain. Control towers have been around for more than 15 years, and while there has been moderate adoption of control tower technology in the market, many companies have been able to run efficient supply chains without it. But as the volume of IoT-generated and consumerrelated digital signals continues to grow, along with rising customer expectations, this will change.

It is becoming increasingly important for companies to be able to see, analyse and act on information across supply chain in real time, and then learn from those experiences to become better at sensing and responding to supply chain risks and opportunities. Successful businesses are leveraging existing data to be able to adapt their supply chains in real time and make intelligent decisions that end in profitable outcomes for their businesses.

There are three ways a digital control tower in your supply chain will help you navigate the complexities of the ever-evolving supply chain: 22 | MHD MAY / JUNE 2019

1/ MEET THE INCREASINGLY PERSONALISED NEEDS OF YOUR CUSTOMERS A digitally connected control tower in your business will help you see all your channels within seconds at the touch of a button. You will know immediately if a customer posts something online to a social media channel and you’ll be able to respond immediately to their post with your course of action to avoid stock outs and lost sales.

You will also be able to respond to the latest trends to optimise and personalise new assortments and customise new product introductions.

Using the insights from your control tower, you’ll be able to plan more effective promotions. The result will be improved customer experiences across every touch point of your business.

2/ MANAGE WHAT YOU CAN’T SEE We all know how it feels to be caught out. There could be a major traffic event on the route one of your vehicles is using or suddenly a storm brings a deluge of rain to the area in which you’re operating. With a control tower monitoring these events ‘round the clock for your business, you’ll be able to respond to an external situation in seconds and minimise the effect it has on your operations.

With a collaborative and connected platform such as a digital control tower, companies can now visualise the entire flow of goods across suppliers, factories, distribution centres, distributors, retailers and customers. Having real-time visibility across the digital supply chain you’ll gain access to a built-in crisis control centre that warns of impending disruptions and recommends corrective actions before those disruptions occur.

3/ AUTOMATE RESPONSES AND ELIMINATE PROBLEMS BEFORE THEY OCCUR Manufacturers will also be able to access real-time data and signals

across their network of suppliers, systems and machines so they can fine-tune production, shipping and fulfilment. It allows them to automate changes at short notice and prevent potential problems before they occur.

A best-in-class, cloud based control tower will include the following features: • Dashboard with real-time visibility into in-transits and inventory positions at various supply chain nodes.

• Aggregate view of product demand by region/site, as well as supply required to satisfy that demand (orders inside lead time and forecast-commits outside lead time), across the entire supply chain.

• Ability to manage by exception via proactive alerts that are triggered when predefined rules and thresholds concerning shipments, inventory, orders, demand and supply are breached.

• Dashboard drill-downs that allow users to view underlying transactions and associated impact for more effective monitoring and KPI tracking.

• Ability to generate data-driven insights and predictions based on data feeds from external partners.

• Modern, intuitive and personalised user experience.

• Ability to seamlessly extract master and transactional data from enterprise resource planning, supply chain planning, warehouse management and transportation management systems.

• Ability to correlate data, events, exceptions and responses and provide fact-based recommendations.

Digital control towers put the data to work for you. From product planning to the production line, shop floor to the store shelf, and from the online store to the front door - the true fulfilment of customer expectations has never been more within reach.

Daniel Kohut is senior alliances solutions director at JDA Software Australia. For more information email Daniel.Kohut@ jda.com or visit www.jda.com. ■

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ACCELERATE YOUR PROFITABILITY Supply chain innovation opens fresh opportunity

PAUL GOEPFERT

A

n unprecedented demand for precision and pace has been a catalyst for change in the logistics and wholesale sector. These high customer expectations have led IDC to predict that by 2022, digital technologies that allow for automation of repetitive tasks will streamline supply chain operations dramatically, cutting typical manual-based processes in half.

These new technologies are geared at helping retailers and wholesalers answer one question. How can I bring simplicity and profitability to my supply chain, in the midst of a chaotic 24x7 shopping environment?

DATA DRIVES ACCURACY AND INSIGHT Manual, labour-intensive supply chain methods impede the pace at which a business can gather and act on vital insights from multiple locations, stakeholders and resources. Leading Australian businesses are leveraging robust Enterprise Resource Planning (ERP) software to overcome these hurdles and provide an outstanding customer experience.

Using best-of-breed ERP solutions, wholesalers can identify the location of a product even if it is stored across multiple warehouses, as well as the quickest picking route. This kind of information speeds up order allocation, streamlining operations to improve customer experience and win loyalty.

24 | MHD MAY / JUNE 2019

Wholesalers can also identify valuable insights that drive better performance through real-time monitoring and historical trend analysis via embedded business intelligence (BI) functionality. This helps wholesalers keep pace with the changing demands of retailers and their customers.

FULL VISIBILITY INCREASES EFFICIENCY Supply chain networks are becoming more complex with multiple suppliers, stakeholders and locations. Of course, wholesalers live or die by the accuracy of their records, and their ability to keep these expansive ecosystems in balance.

This is why manufacturers require an ERP with powerful distribution requirements planning (DRP) functionality embedded. It should offer a visualisation map of the full network to give manufacturers one single view, simplifying their navigation through the system. Businesses can then plan more thoroughly with a clear view of all elements, including stock and staff, across multiple locations on an hourly, daily or weekly basis. A robust DRP should also equip you to source any item, from anywhere, without limitations and control – whether purchasing is done centrally or locally.

This makes it easier to monitor both physical and financial operations from one centralised hub.

TRACKING ACROSS DELIVERIES ENSURES RELIABILITY It is critical for wholesalers to track and manage the supply chain after an order is dispatched. Orders can be delayed, lost or returned to the depot for a variety of reasons, often through no fault of the supply chain management team.

To provide further visibility on this last stretch of the supply chain, proof of delivery (PoD) is a recommended capability integrated within your ERP system, to help improve the overall user experience by keeping the logistics operator up-to-date on every stage of the delivery process. It should be mobile-friendly, so no matter where your team is on the road, they can be alerted to key milestones within each delivery, in real-time. These status changes should then instantly record against a sales order, eliminating manual work and the potential for an order to be lost en-route, increasing overall reliability and profitability.

With complete access to package details, delivery instructions and customer contacts, delivery teams are then more informed and efficient when handling dispatches. An ERP system integrated with location-based tracking services, such as Google Maps, makes it convenient for drivers to plan their deliveries and view distances between drops, at a glance. They can capture signatures and photos upon

MHD FEATURE delivery to serve as proof, ultimately making the process more secure and seamless for the customer. Delivery records can then be viewed at any time, even when offline, helping to eliminate failed or incomplete deliveries due to network drop-outs.

AUTOMATION BOOSTS SALES REVENUE In today’s fast-paced retail world, wholesalers that stand out from competitors are those that demonstrate their ability to rapidly fulfil an order and provide a definite ETA. An ERP system integrated with available to promise (ATP) capability considers a wholesaler’s sources of supply such as purchase, transfer or manufacturing orders and matches this information against sales or branch transfer orders to generate ATP dates. By considering future delivery dates on purchase orders, as well as outstanding sales orders, wholesalers can then provide accurate fulfilment information and better manage customer expectations.

Robust ATP functionality should also offer the intelligence to softly allocate products

“

By considering future delivery dates on purchase orders, as well as outstanding sales orders, wholesalers can then provide accurate fulfilment information and better manage customer expectations.

”

to expected orders, improving stock management and driving real efficiencies in supply chain planning. Wholesalers can then confidently go above and beyond for their customers, with the system providing alternatives to complete orders that inadvertently get delayed or cancelled by one manufacturer. Not only does this build your customer loyalty, it helps drive more sales during periods of peak demand, especially when other wholesalers struggle to cope with orders.

YOUR PATH TO SUCCESS Streamlining and optimising supply chains is a priority for competitive organisations but achieving results can seem elusive and expensive. Don’t let this complexity stop your transformation. Work with a trusted technology partner who has the deep industry expertise required to offer innovative answers to your toughest questions. This will simplify your path to profitability and growth in 2019 and beyond.

Paul Goepfert is the chief marketing officer of Pronto Software. ■

We Optimise Your Supply Chain

MHD MAY / JUNE 2019 | 25

MHD FEATURE

MOBILE TRANSFORMATION Fast, accurate, reliable: how mobile technology is transforming delivery processes BETTER CUSTOMER SERVICE

MICHAEL DYSON

C

onsumer expectations continue to rise when it comes to online deliveries, which is placing extreme pressure on the transport and logistics (T&L) sector.

Mobile technology is enabling local businesses to transform their supply chains and delivery processes – driving efficiency, visibility and meeting customer demand. Logistics organisations increasingly rely on mobile devices and apps to improve customer service, reduce costs and increase productivity.

The benefits of mobility in the T&L sector include reducing downtime, keeping drivers safe, tracking assets and maintaining compliance.

With workers constantly on the move, it means their mobile devices are, too. T&L businesses need to be able to monitor mobile device use and implement systems to reduce risk by controlling available apps on the device while the vehicle is in motion, thus preventing distractions. Mobile technology also allows businesses to ensure they maintain compliance at each stage of the supply chain.

T&L businesses can have different driving factors behind their decision to invest in mobility. A recent report 26 | MHD MAY / JUNE 2019

The use of mobile devices within the supply chain allows for improved customer service, as the real-time data enables accurate delivery times and provides the reason and duration behind any delay. More timely and accurate information makes everyone happier, from the shipper to the carrier to the customer. It’s true that customers want faster and more reliable delivery, but they also want to be kept in the loop and informed of the progress of their delivery. This transparency with consumers prevents the likelihood of customers having a negative experience with their delivery, if they have been informed of a delay, they are less likely to make a complaint about it. conducted by VDC Research revealed that while 36.4% of T&L businesses consider improved worker productivity to be their main driver for investing in mobility, 31.8% view reduced paperwork as their main driver, and 27.3% supported compliance mandates/ reduced risk of litigation as their main driver for investing in mobility.

END-TO-END VISIBILITY Mobile devices deliver real-time, endto-end supply chain visibility. Mobility allows for tracking assets, both where they are and what they are doing. This in turn can improve productivity, as if there is any break down along the supply chain, it is visible, and the issue can be solved quickly. By having end-to-end visibility, businesses can have a more streamlined process with open communication between different stages of the supply chain, improving efficiency, accuracy and timeliness of the delivery process.

By achieving more accurate delivery times with end-to-end visibility, T&L businesses can streamline their operational efficiency and make it faster and easier to offload and crossdock important shipments. This visibility also benefits customers, with them able to track their delivery and keep up-to-date with its progress.

THE MOBILE TECHNOLOGY NEEDS TO BE RELIABLE Without a doubt mobility is impacting the T&L sector as device adoption rates grow. However, this increase in dependency and demand for mobile solutions in local supply chains means that the technology needs to be reliable. The use of more mobile devices and apps opens up the possibility of more risks and IT problems for businesses.

As dependency on mobility continues to grow, a lost connection or failed application can end up being very costly to businesses and can cause time consuming disruptions to operations.

The report by VDC Research revealed that a lost connection or poorly performing application can end up costing T&L businesses almost $20,000 per mobile worker and up to 100 minutes in lost productivity. Having a management system in place will ensure mobile devices run smoothly and if an issue does arise it can be easily and quickly solved, minimising any downtime and disruption, which in turn will save businesses money in the long term.

Michael Dyson is the managing director of SOTI. â–

CONNECTING THE WORLD’S SUPPLY CHAINS

True supply chain connectivity starts with near real time visibility tools.

Clearly see your freight strategy at any given moment with C.H. Robinson’s integrated technology solutions.

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© 2019 C.H. Robinson Worldwide, Inc. All rights reserved.

MHD FEATURE

BRING DOWN THE WALLS I4.0 is bringing down supply chain walls

JOHN YOUNG

DIGITAL THREADS

I

Many manufacturers must deal with a significant quantity of manual, paperbased processes when managing the supply chain. This creates a complex web of procedures and actions, which can be easily confused or lost entirely. Moving from paper to glass and digitalising the tracking and monitoring process creates digital threads that cannot be lost or altered.

While many major organisations run computerised enterprise resource planning (ERP) and supply chain management software, including digital shipping notices and radiofrequency identification (RFID) scanning systems, most have only limited insight into where their products are at any given movement.

f the vision of Industry 4.0 is to be realised, enterprises must step further into the realms of digitalisation. A critical element of this evolution is the move from traditional supply chains towards a connected, smart and highly efficient supply chain ecosystem.

Traditionally, supply chains contain a series of largely siloed steps taken throughout product development, manufacturing, distribution and finally into the hands of the customer.

Digitalisation brings down those walls. Making the supply chain a transparent ecosystem involves all its key factors, from suppliers and transporters of raw materials all the way up to the end user.

28 | MHD MAY / JUNE 2019

Production may be recorded digitally but the moment it moves along the supply chain, a PDF created for shipping becomes no more than a software copy of a printout. Its digital number may tell you where the package is heading, but not what’s inside the box and in the ocean of data that could be available, only a drop of it is actually visible.

Blockchain is no longer confined to the worlds of cryptocurrency and finance. In fact, blockchain will support the global movement and tracking of $2 trillion (USD) worth of goods and services annually by 2023, according to research by Gartner. By implementing blockchains, companies gain a realtime digital ledger of the actions and movements for all participants in their supply chain network.

Blockchain could also help keep products and consumers safe. In 2018, a woman was charged after needles were found in strawberries in Australia, sparking a nationwide crisis and the need for emergency recalls, which caused a major blow to the multimillion-dollar industry.

Using blockchain, a food processing plant can keep track of raw materials, from the farm all the way to supermarket shelves.

This means that if a contamination scandal broke out, the source could be traced back to the specific farm or factory where it began.

By improving traceability along the supply chain, loss due to recalls is prevented and the risk to public safety is massively reduced.

PREDICATIVE ANALYSIS Imagine putting a crystal ball to your supply chain and asking it how much of a certain product you should create. Predicative analytics could help plant managers know exactly what they need to produce to meet demand and how to satisfy downstream customers.

Machine learning is a type of artificial intelligence (AI) that provides computers with the ability to learn without being explicitly programmed. The technology has been a part of our everyday lives for some time. Take credit card monitoring, for example. Machines learn our regular credit card activity over time so when a suspicious transaction outside of our normal purchasing behaviour is noted, the credit card company immediately puts all account activity on hold.

In order to do this, data is key. With more data available than ever before, predictive algorithms can help streamline the supply chain and efficient forecasting can predict future demand based on past events and prevailing trends. Both over and understocking result in loss. If too much of a product is produced, it will result in waste.

If not enough is made to meet demand, it leads to unfulfilled orders that could damage future customer relationships.

With an accurate and detailed picture of demand, predictive technologies such as machine learning and cloud-based inventory management eliminate overstocking and enable warehouses to work together to manage inventory.

The final frontier of business analytics is prescriptive analysis that allows software to not only analyse issues, but also suggest next steps for the supply chain manager. By taking advantage of predictions, prescriptive analytics attempts to quantify the effect of future decisions in order to advise on possible outcomes before those choices are actually made.

“

The final frontier of business analytics is prescriptive analysis that allows software to not only analyse issues, but also suggest next steps for the supply chain manager.

”

STREAMLINING STOCK Predictions can also extend to plant maintenance. Manufactures often stockpile industrial parts, particularly those that risk becoming obsolete, to arm themselves against the threat of breakdown. This large amount of ‘just-in-case’ extra equipment takes up valuable factory space and may not be required for years to come.

Predictive analytics can be used to monitor the condition of all operating equipment in a factory, so that if equipment isn’t performing to its optimum capacity, a plant manager can receive an automatic alert. This increase in transparency means that, in many cases, the problem can be rectified without disrupting the entire production process.

If smart sensors on a motor can, for example, detect and monitor an issue such as overheating and adjust accordingly, this could prolong the component’s overall lifespan. If fixing existing equipment isn’t an option, the smart factory could order a replacement part from a reputable parts supplier, such as EU Automation, without any human involvement at all. This would eliminate the need for manufacturers to stock spare parts in their own facilities and optimises the management of equipment health.

If businesses are to delve deeper into digitalisation, the walls of their supply chains need to be broken down. By making the most of smart technologies, manufacturers can have a better grasp on their stock during every step of the chain.

This will not only determine how much of a product should be created, but where it should go and whether the manufacturing process is working as effectively as it should.

John Young is the APAC sales director at industrial parts supplier EU Automation.

For more information email jonathan.wilkins@euautomation.com or visit www.euautomation.com. ■ MHD MAY / JUNE 2019 | 29

7 REASONS

Seven reasons why industrial fleet management systems matter GRAHAME DON

1/ INFORMATION IS POWER How do people know how to enhance operations if they don’t know what exactly needs improving?

Fleet management systems provide businesses with the succinct information needed to make constructive changes to improve the operation of their fleets. This information is used to address areas to improve upon whether it be resource, asset management related, or both.

In some instances, businesses don’t realise there are small adjustments they can make to see operating costs reduce and productivity increase. It’s thanks to the information supplied by fleet management systems that give people the power to make the required changes needed to see compelling results.

2/ INCREASE PRODUCTIVITY Increasing output, reducing machine maintenance, streamlining efficiencies and improving safety are all made possible with the help of fleet management systems and all aid in increasing productivity in business.

For example, productivity can be affected when mobile machines and/ or equipment are unexpectedly out of service. Fleet management systems can alert management when servicing is due and when incidents have occurred to prevent unexpected downtime.

With management systems, information is reported electronically, meaning management is more inclined to act upon the notification than if this was manually recorded. The outof-service notification allows clients to categorise planned and unplanned maintenance that helps allocate resources. The incident reporting feature also ensures operators are more accountable for machine damage.

3/ STAY COMPLIANT Compliance is key in the business world! Obeying legal laws and regulations is of the utmost importance 30 | MHD MAY / JUNE 2019

to avoid incidents and fines and fleet management systems can help. Fleet management systems can ensure only licensed, qualified personnel can access equipment, preventing any unauthorised use. They should only allow authorised personnel to access machines via a swipe card or pin number. Live email alerts should also notify management when operators’ licences are approaching renewal dates, ensuring all personnel are appropriately licenced.

4/ IMPROVE SAFETY Safety in the workplace is everyone’s responsibility; to ensure the wellbeing of themselves and colleagues.

Incidents can have a dramatic effect on business, so prevention is key and fleet management is the answer: helping to adopt a preventative and predictive approach to workplace safety. The implementation of fleet management systems creates a greater awareness among employees that leads to greater ownership and behavioural changes in operators which reduces incidents.

Fleet management systems such as SmarTrack is equipped with impact monitoring, meaning management is notified of any incidents involving machines making contact with anything and any points of sharp deceleration, making operators more accountable. This also helps management identify where the majority incidents are occurring to identify and address ‘black spots’ in the working environment as well as recording where impacts occurred.

5/ UNDERSTANDING FLEET UTILISATION Imagine having the tools available to gain a comprehensive understanding of how fleets and operators are performing and using this information to assist the decision making process, to ensure the fleet is well-utilised at all times?

In business it is imperative for a fleet to do more, with less; the more

a business can get out of their fleet, the more competitive they are. Being able to strategically improve fleet utilisation, not only boosts productivity and decreases costs but also increases profitability of a business, which is always everyone’s end-goal.

Additional benefits of tracking utilisation include reducing fuel consumption, assisting with fleet deployment and having the ability to manage idle time to plan and manage personnel across shifts. Alerts, graphs and reports are provided displaying fleet utilisation information in an intuitive and easy-to-read format.

6/ BOOST SECURITY Controlling and monitoring access to equipment in a fleet has numerous security and safety benefits. It ensures only those with valid licences and permission are able to access machines to safeguard companies to prevent incidents, and also gives businesses up-to-date information about where vehicles in their fleet are located at all times and personnel who have had access to the machine last. With the fleet management system, machines can only be accessed by an authorised operator signing in.

7/ REDUCE OVERALL COSTS Fleet management systems can help companies decrease fleet-related costs to increase profitability. These systems are integral for monitoring and making progressive changes in managing fleets. It’s these stepchanges that work towards reducing incidents, damage and costs associated with manual paperwork, which in turn significantly reduces costs.

All the benefits associated with the implementation of fleet management systems save businesses money in the short and long term.

Grahame Don is RCT’s senior business development manager, industrial. For more information email GrahameD@rctglobal.com or visit rct-global.com. ■

MHD FEATURE

THE AMAZON EFFECT What does it mean for freight forwarders?

“

The freight forwarding industry is evolving at a relentless pace and becoming increasingly competitive. The question is, who will win out?

”

DOUG SURRETT

A

mazon continues to change the face of retail and recent news hints that the e-commerce giant will have a greater impact on logistics providers in the future. The retailer recently ramped up its ocean freight services and has begun trying to woo shippers from FedEx and UPS as it aims to gain more control of its supply chain. With Amazon showing no signs of letting up, this could signal changes that may bring great transformation to the supply chain industry.

Since the beginning of last year, Amazon organised the shipment of more than 5,300 containers from China to the US. Additionally, the company is forgoing many fees charged by the ‘traditional’ carriers. The concept of Amazon competing with carriers such as FedEx and UPS is not something new.

And interestingly, the traditional carriers are starting to offer services competitive with Amazon. For instance, FedEx announced earlier this year they will be offering a next-day delivery service for packages picked up as late as 2am.

However, now that Amazon is a fully-fledged non-vessel operating

common carrier, they can offer ocean services to clients, effectively removing freight forwarders from the middle.

This ultimately acts as an accelerant in the move towards more direct relationships between steamship carriers and shippers. Today that market is controlled by forwarders, but it is beginning to change.

The freight forwarding industry is one that will be undergoing massive transformation in the next two to five years as technology and other market forces such as Amazon put extreme pressure on forwarders to add value or disappear.

For forwarders, the pathway to profitability lies with process automation and value-added services — a two-pronged approach that reduces errors (improving customer service) and differentiates the business with customised add-on services. And the best way for freight forwarders to achieve both of these goals simultaneously is with proper partners and the right technology.

The fundamental boundaries between different systems are breaking down as

logistics operations evolve into leaner, more agile services. Similarly, freight forwarders should look to technology that is offered as a continuous, scalable service. To stay competitive with the likes of Amazon entering the market, freight forwarders need highly functional systems that operate as single applications, covering everything from order management and shipping, to customs and compliance.

The pressure mounting from new market entrants is also why models like the Global Trade Network are gaining momentum. With the Global Trade Network, freight forwarders have a system that optimises the movement of customer shipments using every mode possible, but also one that helps efficiently move product across borders and time zones — without losing all-important visibility.

Perhaps most critically, the power of a network lies in its ability to bring clarity and certainty to a volatile situation, while offering on-demand connections to thousands of potential carriers. Just like Amazon is using data to drive its logistics network, the Global Trade Network provides the capability for freight forwarders to capture and share data, as well as benchmark their performance against others in the network.

The freight forwarding industry is evolving at a relentless pace and becoming increasingly competitive.

The question is, who will win out?

Scale can help, however for freight forwarders to prosper, they will need to become smarter and must exploit the opportunities that the democratisation of technology has brought.

Doug Surrett is the chief product strategist at BluJay Solutions. For more information call +61 3 9020 4463 or visit www.blujaysolutions.com. ■ MHD MAY / JUNE 2019 | 31

MHD FEATURE

BACK IN CONTROL Removing risk from the supply chain with better information management

paper documents into electronic versions that can be stored, searched, retrieved, and sent anywhere, anytime, provides huge benefits.

This means drivers don’t have to carry hard copy consignment notes or third-party documentation or be concerned with losing them or getting them back to the head office for processing. Everything they need is on a hand-held device they carry with them. All documents are completed electronically and sent to the next step in the supply chain as required. This approach minimises errors, lowers costs and increases efficiency.

2/ PROOF OF DELIVERY

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usinesses that depend on a supply chain can’t avoid introducing risk into their operations. Supply chain risks come from issues such as unpredictable demand, interruption to supply, environmental fluctuations, financial volatility, and physical conditions (https:// bit.ly/2sxSeSx). It’s therefore essential to find ways to mitigate these risks.

Relying on other organisations is part of doing business but it means giving up some element of control. Businesses need to claw back as much control as possible to minimise the risk of business disruption caused by supply chain partners. Putting the right technology in place can help provide a higher level of control and visibility.

Specifically, businesses need to manage information and documentation more effectively for streamlined, reliable supply chain operations.

We have identified three key areas in which businesses can proactively reduce the risk presented by supply chain partners through better information and document management.

1/ TRANSPORT AND LOGISTICS Challenges around delivery and compliance requirements mean the transport and logistics side of the supply chain generates a massive amount of paperwork. Reducing the burden of manual processing is crucial to keeping costs down. Therefore adopting digitalised workflows that turn hard copy 32 | MHD MAY / JUNE 2019

MATT COAD

“

Having the right technology in place lets businesses implement compliance workflows, track documentation, prepare quickly and comprehensively for audits, keep information secure, and ensure no aspect of compliance is ever missed.

”

Transactional documents such as dockets and invoices are crucial to track the movement of goods through the supply chain. Managing these documents effectively can reduce the risk of something going wrong and it can also help organisations identify anomalies sooner so they can deal with them faster.

Digitising the proof of delivery process via a tablet or adding smarts to documents such as automated barcode recognition results in instant storage, search, and retrieval of POD. It can also provide exception reporting to identify daily jobs that are yet to be returned, along with integration into enterprise resource planning (ERP) systems, and more.

3/ COMPLIANCE Compliance requirements create a significant administrative burden when there are no processes and systems in place.

The complexity can make it difficult for organisations to manage their compliance efforts effectively.

Having the right technology in place lets businesses implement compliance workflows, track documentation, prepare quickly and comprehensively for audits, keep information secure, and ensure no aspect of compliance is ever missed.

The crux of good business operations is information governance. By managing paperwork and documentation in a streamlined, automated, digital way, businesses can significantly reduce the risk in their supply chain.

Matt Coad is the EGM of solutions at Upstream. For more information visit https://upstream.com.au. ■

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OWN THE FUTURE

The distribution centre of the future: scale, flexibility and the need for automation MARTIN KOHL

A

s technology advances and society changes, consumers are demanding services faster and more readily available. Current warehousing and distribution practices won’t be sufficient to keep up with market expectations, so forward-thinking businesses are investing in flexible, scalable and automated solutions to future-proof their operations.

Societal and logistics trends will have a huge impact on what the warehouse of the future will look like.

IMPACTS ON DISTRIBUTION The changes in society and technology will certainly influence how products are stored and distributed in the future. Based on those changes, key capabilities of the supply chain of the future will include:

1/ Storing products closer to consumers Many of the trends lead to the same conclusion: more people living in cities and ordering products online, which will increase the need to support same-day delivery. At the same time, cities will be battling increased congestion and air pollution.

Small, self-driving vehicles and local delivery robots, such as Starship, and possibly drones could be part of the 34 | MHD MAY / JUNE 2019

solution to this challenge. However, these systems are typically meant for short-range transport, which will require that distribution centres be located in cities, close to large groups of consumers.

Yet, this presents its own set of challenges. The number of SKU is already in the thousands or tens of thousands in many warehouses and could grow to more than 100,000. With the space constraints inherent in most urban environments, how can an urban distribution centre support the needs of the market it is positioned to serve?

2/ Customised production As seen with the example of the new Adidas factory, products that are custom-made for one consumer do not require warehouse storage.

These articles are sent from the manufacturing site to the consumer directly upon production.

While this minimises the requirement for storage space, it will require fast transport and sortation networks, and potentially some ultrashort storage to synchronise product flows with consumer schedules.

In 2030, customised production will most likely be limited to luxury items, spare parts or fashion products. Basic essentials will still be produced to stock – probably in smaller batches than today, but enough to require some form of warehousing.

3/ Omni-channel support Supporting omni-channel retail requires providing consumers with options that extend beyond traditional delivery. By enabling options such as in-store or kerbside pickup, retailers can give consumers more control over how they receive products and eliminate some of the frustrations with home delivery, such as product security and returns, while minimising the cost of same-day delivery by shifting the cost of the ‘last mile’ to consumers.

These various impacts are all addressed through the development of urban distribution centres that bring distribution closer to consumers, support custom production and enable fast, efficient delivery based on consumer preferences.

THE URBAN DISTRIBUTION CENTRE OF 2030 Societal trends are driving the shift to numerous urban distribution centres that bring key logistics capabilities close to consumers. Urban DC will likely be shared-service facilities that optimise all logistics flows for the area or community they serve, including the following core functions:

1/ Inventory and order picking Similar to many warehouses today, the urban DC will need to hold some inventory. However, since space in

MHD FEATURE cities is limited and product ranges are likely to continue to expand, this inventory will be limited. In principle, smaller items and products that are sold regularly would be held in stock. Inventory size would be minimised through 3D printing and use of big-data to predict behaviour and distribute articles to the urban DC just before they are ordered.

An order picking process, using automated picking systems would also be required. Because the urban DC will support multiple sellers in a shared service model, this creates the opportunity to consolidate articles from different sellers into one shipping carton to reduce shipping costs and enhance the customer experience.

2/ 3D printing Products not available in the limited inventory may be 3D printed. This reduces inventory requirements and allows the creation of individualised products. The urban DC is an ideal location for several large, sophisticated and fast 3D printers. With the picking scenario described above, it is also possible to consolidate printed items with items picked from the inventory into one parcel.

3/ Parcel consolidation The urban DC of the future will consolidate pre-picked parcels coming from multiple sellers or parcel companies into one lastmile transport to the consumer.

Functionally, this is no different from the many parcel sortation hubs that exist today. The difference is that flows will be consolidated. In today’s networks, companies like DHL, UPS and FedEx do their own sortation and last-mile transport, for their customers. The future urban DC will consolidate flows from all companies.

KEY ENABLING TECHNOLOGIES In addition to supporting these core tasks, urban distribution centres will need to incorporate a number of advanced technologies to meet the distribution requirements of 2030.

For picking, intelligent robots with advanced grippers could not only pick individual products, but also assemble products from several parts produced inside the warehouse, and consolidate orders from multiple sellers,

including 3D printed products, into one shipping carton. Robotic goodsto-person or fully automated picking systems, such as Swisslog’s AutoPiQ, would support the high pick-speeds required by the urban DC. Big data and smart, self-learning analytics will predict what consumers will be ordering to minimise inventory; however, the predictions will not always be correct, and that will create additional product movements.

Technology advances, such as selfdriving trucks and robotic loading and unloading systems, will minimise the costs of those movements.

For products that can’t be printed and are not predicted, new means of fast, long-distance transport could support delivery of products not stored locally. Emerging transport technologies, such as Hyperloop, could connect large, central warehouses with urban DC in major cities. Alternatively, larger, longdistance cargo drones could offer flexible, infrastructure-independent transport over longer distances. In addition, automated storage and retrieval systems could be deployed to maximise the amount of product that can be stored in the available space.

Online marketplaces would need to be employed to manage supply and demand among sellers vying for space in the DC, allowing sellers to balance their costs against the need for delivering very quickly. This will reduce the number of distribution centres within a particular city and maximise space utilisation.

LAST MILE DELIVERY OPTIONS Many different ways will exist for last mile delivery and the urban DC will need to interact with a multitude of delivery options.

A significant percentage of parcels will still be delivered in a multidelivery vehicle. Most likely, this will be an electric, and potentially driverless, version of the familiar delivery van. Loading such a vehicle efficiently requires that a high number of parcels be loaded simultaneously in as short as time as possible. Very likely some kind of drop-sequence will be required for that as well.

For this, we can imagine standardised loading modules where parcels can be staged before the vehicle

arrives and loaded into the vehicle ‘in one go’. Inside the vehicle, there may be a form of automated handling, presenting individual parcels to the driver. The Daimler Vision Van is an early example of this concept.

The urban DC will also need to support customer pickup, and a network of mobile pickup points.

To support pickup, the DC will require a ‘parcel station’ similar to those used by overnight shippers today. But, being located within an automated warehouse, it will allow for automatic loading of individual lockers, from which consumers would receive their purchase from the back.

Mobile pickup points would be filled quickly with multiple parcels at the community warehouse and then driven to a spot even closer to the consumer (e.g. shopping mall parking lot) where consumers would pick up their parcels.

Some parcels may need even more individualised transport methods.

Parcel-drones or small autonomous vehicles similar to Starship could accomplish this. These methods will require different loading processes, since each vehicle will only be loaded for one stop. The warehouse will need a series of small ‘docks’ for these vehicles, and a way of automatically loading into the drone or vehicle.

Another potential scenario is that consumers will send their self-driving vehicles to collect their packages. For that, the DC could use mobile robots to place the goods in the trunk of the car. It is not difficult to imagine a next generation of KUKA’s Mobile Robot (KMR) doing this.

The preceding article in this series Welcome to the future appeared in the November-December issue of MHD magazine and can be read here: https://bit.ly/2CpLU5H. This article is to be continued next issue with Scale, flexibility and the need for automation and A question of ownership.

Martin Kohl is senior sales consultant, warehouse and distribution solutions at Swisslog Australia, responsible for Swisslog’s Food & Beverage segment in Australia and New Zealand. He has over 15 years of experience in intralogistics with roles varying from consulting, design and project management to market strategy and innovation. For more information visit www.swisslog.com. ■ MHD MAY / JUNE 2019 | 35

SPOTLIGHT ON PROMAT 2019

USA trends in DC equipment and digital consciousness MAL WALKER

I

n early April I had the opportunity to visit Promat 2019 in Chicago. Promat is North America’s largest materials handling equipment and systems exhibition, featuring over 950 exhibitors and 150 educational seminars.

What is happening in the Northern Hemisphere from a material handling and logistics perspective?

In this article, I will give you a glimpse of some of the distribution centre (DC) trends and technologies that Australian firms should be aware of.

THE RISE OF THE DIGITAL SUPPLY CHAIN AND DIGITAL CONSCIOUSNESS The Deloitte Report indicates that firms are adopting digital supply chain innovations at a fast rate: • Cloud computing: 56% of firms surveyed are adopting, with growth expected to 79% over the next two years.

• Inventory and network optimisation is forecast to reach 75% adoption over the next two years, and 90% over the next five years.

THE TOP TWO CHALLENGES FACING DC OPERATORS 1. Hiring qualified workers.

2. Customer demand for lower delivered costs.

Labour shortages of qualified workers is of growing significance in the USA. This may be hard to understand in a nation with over 330 million people, yet it’s top of the list in the Deloitte survey. What is driving this? Sadly, young Americans do not aspire to work in warehouses, even when jobs are available, and pay is reasonable. This is exacerbated by the Trump Administration’s reduction in

AI

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ITA

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Figure 1. Digital Technology Adoption Pyramid. From the 2019 MHI Annual Industry Report, presented at Promat and prepared by Deloitte.

• Predictive analytics is expected to reach an adoption rate of 87% of firms.

• Sensors and automatic identification adoption 86% of firms.

• Industrial IoT (internet of Things) 80% of firms.

• Wearable and mobile technology 73% of firms.

• Blockchain and artificial intelligence, while at low adoption rates currently, are expected to reach 62% in the next five years.

Advanced Analytics

Automation

Internet of Things Cloud Computing & Storage Sensors & Automatic Identification Blockchain & Distributed Ledger Technologies

Digital Connectivity

OF

Robotics & Automation Wearable & Mobile Technology Autonomous Vehicles & Drones 3D Printing (Additive Manufacturing)

ES ST AG

Predictive Analytics Inventory & Network Optimisation

Artificial Intelligence

36 | MHD MAY / JUNE 2019

immigration, so with cuts to imported labour, workers are indeed scarce.

Consequently, firms are refraining from investment decisions based largely on labour savings. They are focusing on customer delivery, best use of footprint, and smart ways to obviate labour shortages. At Promat, it was clear that the answer lies in robotics, autonomous vehicles and drones as the displays of each were prolific. With a steep curve of American adoption over the last two years, driving factors are: 1. The cost per unit for such equipment has decreased.

2. Reliability has increased.

3. Robots are fast evolving into ‘Cobots’ or collaborative (human friendly) robots.

Cobots Cobots can work alongside human beings, and can see, slow down or speed up depending on the proximity of people. They can also be interrupted or paused in their work by human intervention, before continuing their tasks when ordered to resume. In future, we can expect to see a combination of cobots and humans in order picking situations working alongside each other.

For example, equipment such as Goods to Person systems, are turning into Goods to Cobot systems.

What is interesting is that the control of automation is demanding a new breed of skilled labour with digital, data analytics and artificial intelligence skills.

Autonomous vehicles Autonomous vehicles are being used with excellent safety features that allow them to work alongside human operators. Advances in digital control systems provide for both cobots and autonomous vehicles, to be dynamically operated according to order urgency and priority. This feature is hard to achieve with fixed infrastructure such as zone route and batch picking systems, but with free-path autonomous vehicles,

MHD FEATURE they can be programmed to receive urgent orders, jump the queue and pick items immediately.

Drones Despite what you may have heard, drones are not being used very much for ‘last mile’ customer delivery, as there are navigational issues that have not been resolved. Yet they have found their way into DC for a different purpose. Tracking inventory! They are being used to perform cycle counting of palletised stock. They fly down aisles of racking at predetermined times, taking readings of barcodes on racking and checking that pallets are in the correct pallet locations. Data from the drones is fed back to ERP systems for updating of inventory records.

Fixed infrastructure - or not Robots, cobots and autonomous vehicles are causing many companies to reassess the implementation of fixed warehouse infrastructure such as conveyors, goods to person and sortation systems, particularly as the former are cheaper to install, run and maintain. The implication of this is that for conventional warehouses, with basic materials handling equipment, operators can scale up their operation by adding robots at lower capital investment than fixed equipment.

Blockchain Blockchain is increasingly being used in supply chains. As a distributed digital ledger, it is providing a new architecture for business and logistics transactions. Whilst it is seen as transformative, the take-up will take time to move off TCP/IP communications protocols. However, forecasts predict that in ten years, approximately 10% of US gross domestic product will be in blockchain.

DEVELOPING NEXTGEN SUPPLY CHAIN TECHNOLOGIES As mentioned earlier, labour shortages in the USA are rife. These are causing companies to review how they can retain and attract people who have digital skills. Evidence shows that introduction of NextGen supply chain technologies can be scary for existing employees, therefore US firms are now setting strategy around successfully adopting digital technologies and

capabilities. In this regard a kind of ‘reverse mentoring’ process is in place whereby seasoned supply chain professionals are being paired with younger professionals who have grown up with digital technologies. In short, the wisdom of elders is being combined with tech savvy youngsters, to determine how best to apply emerging technologies.

DIGITAL ADOPTION STRATEGY FOR THE NEXTGEN SUPPLY CHAIN The Deloitte report postulates that American firms need to intentionally work on a four-stage digital adoption strategy to effectively deal with the NextGen supply chain and use of artificial intelligence (AI).

Stage 1: Digital Connectivity. Process of collecting, cleansing and organising data from multiple supply chain sources.

Stage 2: Automation. Using automated systems, robotics and augmented technologies to perform repetitive supply chain tasks.

Stage 3: Advanced Analytics. Using digital information for the purpose of inventory and optimisation, predictive and prescriptive analytics.

Stage 4: Artificial Intelligence.

Decision making by machine learning, using technologies to copy or expand human activities to reason and interact with the environment. At this stage, automation will be characterised by robots and cobots, learning as they

work, with intelligence to accept data while working, instead of adhering to a fixed program.

OUTLOOK FOR AUSTRALIAN FIRMS The future looks bright for suppliers and users of robots, cobots and autonomous vehicles, particularly in small and medium enterprises, which do not have the financial capacity of larger firms.

Organisations are encouraged to consider their own strategy for digital adoption. Especially if they wish to explore operational benefits of robots, cobots and autonomous vehicles. As we have seen in the past, Australia is only a little way behind America with US trends flowing down under.

So, the learning from Promat is that enterprises should plan for digital adoption, and investigate new ways of materials handling, in the wake of increasing competition, customer demands and potential labour shortages.

Ignoring these factors could be at the enterprise’s peril.

Mal is manager, consulting with the Logistics Bureau, where he works with local and international organisations to guide them in specification preparation, establishment and review of outsourcing contracts.

He holds qualifications in engineering, business operations and logistics. For more information contact Mal on 0412 271 503 or email mwalker@logisticsbureau.com. ■ MHD MAY / JUNE 2019 | 37

NEED TO KNOW What transport businesses need to know to compete in 2019 and beyond

PETER LAWTHER

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usinesses in every industry are being affected by the rapid evolution of technology.

Businesses that can leverage emerging technologies to transform will be better-equipped to compete in the modern, competitive marketplace.

Those that fail to integrate these technologies into their operations and, in many cases, use them as the impetus to create new business models, will find themselves falling behind in the near term.

There are seven key trends that are likely to impact the transport industry in 2019. Business leaders should be aware of these trends and act now to prepare.

1/ TAKING THE INTERNET OF THINGS (IOT) SERIOUSLY Freight transport faces many challenges, including ensuring safety, reliability of service, efficiency of delivery, and a need to find growth.

Implementing IoT technology will be crucial to success in many of these aspects by providing increased asset productivity, cost savings, improved driver health and safety, increased visibility into the supply chain, and predictive maintenance. However, as IoT technology within the transport sector hasn’t traditionally been viewed as a holistic strategy with a clearly-defined business objective and benefit, projects often do not scale beyond proof of concept. This will need to change if the sector is to make meaningful progress towards digital transformation.

2/ REACHING DIGITAL MATURITY If digital vision within the transport industry has been previously lacking, there are signs that 2019 will see a push from CIO to liberate the benefits of digital technology. According to new research from Gartner, a high degree of digital maturity is already present in 38 | MHD MAY / JUNE 2019

the transport sector, with only two per cent of respondents stating they have no digital initiatives on their roadmaps, compared to ten per cent in 2018. The insights from the research also showed that 21 per cent of digital initiatives within the sector are in the scale phase, increasing from seven per cent in 2018.

And ten per cent of CIO are already redefining their digital initiatives by optimising their digital business and seeking new opportunities, an improvement from three per cent in 20181. While digital progress is on a limited front, it is happening.

3/ DISRUPTION BY DIGITAL PLATFORMS The digital platform economy has disrupted the passenger transport industry with the introduction of Uber and other ride-sharing platforms. In 2019, freight transport is likely to be next impacted. Amazon in the United States, for example, has launched the Amazon Delivery Service Partner to empower entrepreneurs to move into the logistics delivery space2.

4/ EXPLORATION OF BLOCKCHAIN TO DRIVE EFFICIENCY AND TRUST Transport is potentially a natural fit for blockchain initiatives, as it has the potential to increase trust and security between participants in wider value chains and to automate transaction and payments within those chains.

From a low base, 2019 will see an expansion of exploratory projects to find where value resides.

5/ CUSTOMER RELATIONSHIPS TO GET HIGHER PRIORITY The research from Gartner also shows a strong desire on behalf of CIOs within the transport sector to improve the quality of customer relationships3. As a result, CIO are placing an increased emphasis on collecting and analysing customer data to gather insights.

6/ COORDINATED ROLL-OUT OF ARTIFICIAL INTELLIGENCE (AI) Despite being ranked the second gamechanging technology, AI is only in seventh place when it comes to receiving increased investment, according to Gartner4. While initial implementations of AI included chatbots within call centres and autonomous vehicles, this will begin to change in 2019, with transport companies now looking to AI for robotic process automation.

7/ LACK OF FUNDS, RESOURCES, AND SKILLS There will be no let-up in the pressure on resources in 2019. Some entities do not have the funds available to innovate quickly enough on their digital journey. As a consequence, many transport companies are looking for partnerships with IT service firms, start-ups, or software providers to help them fill the gap in IT resources and skill sets. These ecosystems are bringing innovation and helping to accelerate organisations’ digital strategy, creating new marketplaces and communities.

These trends include plenty of opportunity for smart transport businesses to take the lead and gain a first-mover advantage. In an increasingly competitive marketplace, businesses will need to find every advantage possible. Working with a knowledgeable, collaborative technology partner can help transport organisations create value in their businesses and take a leading position in the industry.

Peter Lawther is the chief technology officer at Fujitsu Australia and New Zealand. References: (1) 2019 CIO Agenda: Transportation Industry Insights, Gartner, October 2018; (2) https://logistics.amazon. com/marketing/opportunity; (3) 2019 CIO Agenda: Transportation Industry Insights, Gartner, October 2018; (4) 2019 CIO Agenda: Transportation Industry Insights, Gartner, October 2018. ■

MHD FEATURE

DIGITISE TO WIN

How even small to mid-sized companies use digitisation to work smarter, not harder WALTER SCREMIN

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igitisation promises to deliver genuine efficiency gains but there are some principles to making it work. Digitisation is becoming more influential, whether via common telematics technology or sophisticated global systems incorporating the Internet of Things (IoT). But more logistics divisions are asking how far they need to go, and how they can get the most from digitisation.

There is a risk in overspending and overcommitting to something with only a marginal pay-off. Digitisation can bring genuine efficiency gains, manage inventory and improve customer service. But just buying an off-the-shelf solution won’t necessarily solve all your problems.

For it to really work, you need two things going for you: 1. Good systems and processes which allow the technology to shine.

2. A commitment to put in the daily effort required to get the most from the technology.

Some of the most impressive digitisation examples I have seen come from the automotive parts industry – logistically, auto parts is among the most cut-throat industries, working against tight deadlines and often unpredictable orders. In auto parts supply, if you can’t get the right part to your customers at the right time there’s always another competitor who can step in.

While you might expect such an industry to be dominated by bigger players, in fact many small businesses thrive in this environment. But they have been incredibly smart about the way they go about it.

For these businesses, strong systems and processes form the backbone to the operation. All aspects of the logistics division needs to be working together – if any of inventory, drivers, vehicles, ordering processes and proofof-delivery are inadequate the whole chain can fall apart.

Good systems will cope well with the unpredictable. Managing driver absentees is a perennial challenge – good systems will have a pool of drivers identified, including back-up drivers who are familiar with the business and can step in when required; the system understands drivers’ availability and can seamlessly replace an absentee quickly. Poor systems will make it up on the run, usually pulling someone out of the warehouse or another area to run deliveries for the day – they fill a gap but lose efficiency and risk late or missed deliveries.

Managing vehicles is the same – good systems track vehicles, plan for maintenance and have contingency for unexpected break-downs or crashes, while poor systems wait until something goes wrong and struggle to replace vehicles which are off the road.

Many auto parts firms selectively outsource these crucial fleet operations for greater flexibility and control, whilst also incorporating digitisation.

These companies understand technology is not a magic wand.

Finding efficiency requires a daily commitment and knowledge of what you are working towards – for example, fleet tracking technology provides overwhelming data, and many high-performing fleets narrow it down to some key indicators.

While tracking technology has been available for some time, there is still surprisingly low take-up among many small-to-mid-sized delivery fleets in other industries. Auto parts companies want to see where their drivers are at any time. Most importantly, customers can receive reliable updates on their deliveries using the same tech.

The auto parts industry was among the first to use this technology on a daily basis, to enhance their customer service and allow their drivers to achieve more deliveries in the same hours as previously.

Auto parts show that logistics divisions of any size can be improved by incorporating digitisation. But they also show a longstanding commitment to systems and process is as important as the technology itself.

Walter Scremin is general manager for national transport firm Ontime Delivery Solutions. For more information visit www.ontimegroup.com.au. ■ MHD MAY / JUNE 2019 | 39

PROCESS SUSTAINABILITY The test of all good transformation programs – Part 1.

ROD HOZACK

“

The purpose of induction education should be to also formally introduce and explain the key processes in the business, as well as people’s roles and responsibilities.

”

40 | MHD MAY / JUNE 2019

P

rocess sustainability – why does it matter? After all, once a company deploys a program, achieves its goals and has reaped the benefits, there is nothing more to do, right? Wrong.

Process sustainability is a crucial element in the success story and presents three significant benefits: i) Ongoing benefit realisation. ii) Prevention of regression and atrophy. iii) A solid platform for building further improvement.

As is identified in Jim Collins and Morten T Hansen’s Great by Choice, one of the three core elements that sets ‘10x’ companies apart from the ‘also rans’, is fanatic discipline. The five keys of sustainability is a self-perpetuating cycle to not only maintain the results, but continually build improvement through the application of a disciplined approach.

At Oliver Wight, we often come across the misperception that the formality and discipline required for sustainability can stifle creativity and flexibility. Our experience is the opposite –it liberates creativity because there are boundaries to work within. The primary impact of process sustainability mechanics is to ensure that ‘the routine things are done routinely’, which in turn frees people to work on strategy and innovation. On the other hand, the people-dependent processes that dominate business culture, often result

in employees – including senior managers – being dragged into the detail and losing sight of the bigger picture.

For example, one of the areas we target, is improving forecast accuracy. Educating people, designing new processes and installing new software requires a lot of effort, precision and planning, but if we get it right, the results can be stunning.

Accuracy improves, bias is eliminated, inventory reduces dramatically, flexibility increases, and resources are re-routed to anticipating and planning for issues before they become today’s problems.

Now imagine that a new employee joins the organisation who isn’t familiar with the process, hasn’t received training, and doesn’t understand why measuring forecast accuracy and bias is so important. In time, Excel spreadsheets start to become a substitute for the forecasting package, other ‘more important’ metrics are introduced, and knowledge wanes with each subsequent new employee.

At Oliver Wight, we cover nine categories of business planning and execution (see panel); process sustainability applies equally well to them all. The same is also true if we are only reinvigorating an existing process a sustainability plan is critical.

There are five keys of sustainability: 1. Education and training.

2. Communication and feedback.

3. Formality and discipline.

MHD SUPPLY CHAIN 4. Role descriptions.

5. Appraisal and the reward and recognition approach.

We will cover the first two in this issue, and the other three in the next issue of MHD Supply Chain Solutions magazine.

1/ EDUCATION AND TRAINING Induction

Most companies claim to have induction education, but when we delve into it a little more, we often discover it consists of company policy, product range, who the major customers are, and an organisation chart. These all have merit, but the purpose of induction education should be to also formally introduce and explain the key processes in the business, as well as people’s roles and responsibilities. When questioned why their induction education doesn’t address this, companies often shrug it off with ‘It’s a learn-by-doing induction’.

An induction program should at least include: • Integrated Business Planning process, including the decision authorisation policy and escalation criteria.

• Integrated Tactical Planning process, including time fence management and escalation criteria.

• Strategy development and deployment processes.

• Continuous improvement methodology and housekeeping process.

Refresher Education should not be limited to just ‘induction education’ for new employees – organisations need to establish it as an ongoing activity throughout the year. It’s easy to assume that after a 12-month initial education and change management program, there is nothing new to share. This is incorrect. Annual refresher education sessions are a golden opportunity to re-energise people by demonstrating how much has changed/ improved, how much has already been done and how much more can be achieved.

It’s also an opportunity to obtain feedback on refinements and improvements, and it can be timed to coincide with annual document reviews and updates to policies and procedures. And of course, knowledge does fade over time, so a top-up session is always beneficial to keep things fresh.

At Oliver Wight, we believe in the principle of ‘learning by doing’, but without a framework to build ‘muscle memory’, processes will decay over time. Education is also crucial in explaining the ‘why’ behind

Figure 1. The principal objective of integration.

THE OLIVER WIGHT ‘CLASS A STANDARD’ FOR BUSINESS EXCELLENCE COVERS: 1. Managing the Strategic Planning Process, 2. Managing and Leading People, 3. Driving Business Improvement, 4. Integrated Business Planning, 5. Managing the Products and Services Portfolio, 6. Managing Market Demand, 7. Managing the Supply Chain, 8. Managing Internal Supply, and 9. Managing External Sourcing.

processes. If that is not understood, it can also lead to a lack of motivation to maintain the process integrity and discipline.

By encouraging personal investment in the process through education, people are motivated to continue to strive for improvement.

Training If education is about the ‘why’, training is about the ‘how’. It has been reported that less than 20% of most businesses’ ERP system functionality is actually being used.

Since ERP systems are often the single most expensive purchase for a company, it also makes it the single biggest waste. It boils down to a lack of adequate training.

A common mistake is for organisations to either provide superficial training – screenshots in a PowerPoint presentation – or to give access to the tools with no guidelines at all.

At Oliver Wight, we often use the Principle Objective of Integration model (Figure 1.) to describe the pathway for achieving true integration in a business. Starting with people and behaviour, we ensure the requisite knowledge transfer has occurred and buy-in to appropriate behaviours has been gained. Once people are armed with this new knowledge, we can guide them in designing processes that align with the business’s strategy, and then also aligns the tools (computer systems) to business processes. All too often we see this done in the reverse order and needless to say, the latter approach is rarely successful. >> MHD MAY / JUNE 2019 | 41

“

The plans must be aligned with the way people work and constantly communicate the value of good work practices.

”

TOP: Figure 2.

Simple continuous improvement model.

BELOW: Figure 3. The ball and chock model.

With regards to training, it is essential that not only are the tools installed, but that they are used and used optimally.

Without training in the continual application of what is available, the pernicious spreadsheet culture will infiltrate and undo a lot of the opportunities that specific-purpose software creates.

2/ COMMUNICATION AND FEEDBACK When Oliver Wight introduces programs of work, including small-scale projects, there is always a communication plan to ensure a continual stream of relevant and timely information is shared. When addressing the sustainability plans at the end of a program of work, the communication plan should be an ongoing activity that has a budget allocated, the strategic intent documented,

and a detailed activity plan created. Like all good plans, it should be measured for its impact and relevance.

Existing organisational communication departments are an ideal channel through which to disseminate these plans, but the plans must be aligned with the way people work and constantly communicate the value of good work practices.

Routine feedback Feedback is a very important element of communication. While it is often seen as something separate, we see it as ‘closing the loop’ in establishing a culture of two-way communication. As a starting point, feedback mechanisms should be in place for all communication media and events.

Other key areas to include are: • Meeting and process critique.

• Engagement and ‘bullet proofing’ proposed changes to ways of working and computer systems.

• All communication sessions, e.g. strategy and direction setting, ‘state-of-nation’ sessions, etc.

This article will conclude in the JulyAugust issue of MHD Supply Chain Solutions magazine, describing the other three keys of sustainability: 1. Formality and discipline, 2.

Role descriptions, and 3. Appraisal and the reward and recognition approach.

Rod Hozack is a partner at Oliver Wight. For more information email information@oliverwight.com or visit www.oliverwight.com. ■

42 | MHD MAY / JUNE 2019

MHD SUPPLY CHAIN

STOP THE NIGHTMARE ANDREW ROSSINGTON

How to prevent a workflow nightmare for your business

T

he nature of supply and demand means that transport businesses undergo drastic peaks and troughs of sales throughout the calendar year. Higher-traffic periods, such as the end of the financial year or around holiday seasons, can change the operational requirements of your business significantly, particularly in sectors like retail or FMCG. Advances across the retail industry and beyond, including AI-powered customer service assistants, the increased accessibility of online shopping, and increasingly globalised supply chains, have changed the way that consumers and companies purchase goods. They’ve also changed expectations of service.

This means you are now required to deliver goods faster than ever.

To meet this demand, you may need to reschedule jobs on the fly or get new drivers and subcontractors quickly up to speed on your business processes. With longer hours and high-volume deliveries to be expected during busier times, it’s important to ensure the safety of your staff while meeting higher service expectations.

Without effective management and job scheduling, busier times can quickly turn into a nightmare for your team.

MANAGING DELIVERY SCHEDULES Tight delivery schedules and a rush of orders can bring new challenges when it comes to job scheduling. We’re seeing the rise of the smart consumer and more demanding customers, who are more discerning and want faster, more seamless experiences. Your business must adapt to the needs of these customers and ensure that your end-to-end processes can provide the service expected of them.

Integrating a freight management system into your business allows you to align all parties involved in the delivery of goods and better manage your pick-up and delivery locations for faster and more dynamic service.

These systems optimise workflow by providing greater visibility and improving efficiency for your delivery fleet, allowing you to streamline your job schedules. Introducing new technologies can facilitate safer, more agile processes and keep your employees safe and healthy.

STREAMLINING BUSINESS TASKS By introducing technology to manage your workflow and the tasks at hand, you can streamline job processes and reduce the burden on all staff involved in the process of making deliveries.

These tools allow you to schedule jobs according to your customers’

requirements, as well as easily track delivery and pickups. In turn, this enables an easy workflow so back-office staff can directly communicate with delivery drivers to allocate manifests and call for help in the event of an incident.

Effective job execution is essential during busy periods, as customer service remains a high priority for businesses to ensure profitability. As supply chains and deliveries become more complex than ever, introducing a job execution tools can help operators manage their responsibilities efficiently and integrate all necessary processes.

These tools work with existing freight management systems to provide streamlined, real-time data for all employees involved in job delivery.

Integrated technology ensures businesses are able to keep track of their responsibilities. And having all essential data in one location means that information is highly accessible and easily monitored by back office staff, which can help to reduce the burden of compliance on your business during high-traffic periods, encouraging a happier and healthier environment for all of your employees – without compromising the fast delivery times customers have come to expect.

Andrew Rossington is the vice president for transport in Australia at Teletrac Navman. For more information visit www.teletracnavman.com.au. ■ MHD MAY / JUNE 2019 | 43

MHD THE LAST WORD

REDUCING THE HAYSTACK T

It’s time to reward those in international trade who are taking measures to minimise risk PAUL ZALAI

Paul Zalai.

44 | MHD MAY / JUNE 2019

he Australian Government provides a diverse range of services, support and benefits to the Australian public to achieve its policy outcomes.

Much of this is funded by our hard-earned income tax (and other general taxation), sale of public assets, government investments and more focussed cost recovery measures.

Like defence, it could be argued that ‘Quarantine’ and ‘Customs’ community protection activities should be funded by taxpayers out of consolidated revenue. While sound in theory, no government would realistically want to put a dent in the Federal budget, nor would they have an appetite to wind back the clock seeing that we have had cost recovery measures in place since the mid 1990s with industry being charged for specific border and biosecurity activities.

The environment is changing with a move away from ‘one size fits all’ in terms of import and export statutory reporting.

The Australian Border Force (ABF) is proudly, and justifiably so, promoting the Australian Trusted Trader Program. The initiative rewards importers, exporters and intermediary service providers with benefits including a dedicated account manager, duty deferral and priority processing.

Entities that can demonstrate that they deploy a secure supply chain are substantially moved to one side to allow ABF officers to focus on a ‘reduced haystack’ of remaining entities.

This approach is not just sensible, it is essential in an environment of rapidly growing volumes of trade and where the ABF is continually tasked to meet community

protection expectations more with diminishing resources.

The question needs to be asked that if we are moving away from a one-size-fitsall regime, shouldn’t Australian Trusted Traders pay a differential fee if their actions are reducing the risk for the ABF? Perhaps those traders remaining in the ‘haystack’ and absorbing valuable ABF resources should be paying a higher rate?

In a similar manner to ATT, the Department of Agriculture and Water Resources has in place Approved Arrangements whereby certain accredited industry participants can complete their own biosecurity assessment of ‘low risk’ commodities. This reduces the burden on the department allowing available officers to focus on high risk consignments.

This again leads to an argument that those reducing risk should be rewarded with a differential cost recovery fee.

While we continue to advocate for this outcome, the Federal Government announced in the 2018-19 Budget “a levy on imports by sea to invest in a stronger, fit-for-purpose biosecurity system, to commence on 1 July 2019.”

The Government stated that the levy, estimated to raise $325 million over three years, would “contribute to onshore surveillance, diagnostic, data analytics, research and adoption of new technology to help us detect, identify and respond to exotic pest and diseases earlier and ensure we can move people and goods into Australia safely and more efficiently.”

It is important to note that this levy will be administered above and beyond the existing cost recovery arrangements. Like all taxes, it is likely that this will require legislative backing.

The challenge will be whether some form of flat fee will be implemented in terms of a form of taxation or whether cost recovery principles will be introduced to apply costs against risks.

The Biosecurity Levy Steering Committee is due to report its finding by June 2019 – the outcomes will be critical by way of setting another precedent for ongoing tax and cost recovery reform.

Paul Zalai is a director of Freight & Trade Alliance (FTA). Paul was recently appointed by to participate in the Biosecurity Levy Steering Committee. For more information visit www.ftalliance.com.au. ■

MHD MATERIALS HANDLING AND MANAGEMENT

DURABILITY WINS

T

asmania’s largest food distribution business SRT Logistics has taken delivery of 36 new Toyota Material Handling forklifts and pallet jacks, which it purchased outright after considering a business case to depart from a leasing model.

Headquartered in Brighton, near Hobart, SRT Logistics has grown from a small refrigerated food transport operation to a full supply chain management provider. With five distribution centres, it services every town in Tasmania with dry, frozen and chilled foods for customers such as Woolworths, Lion, and Schweppes, and also ships across the Bass Straight to its Melbourne depot.

All its sites feature dedicated refrigerated warehouses with sealed loading docks.

CEO Rob Miller said his father, Jim, founded SRT Logistics 30 years ago before Rob and his brother Brent Miller joined the business. “My father had a refrigerated truck or two and worked with Purity supermarkets, which is now Woolworths. When I started in the family business in 1997, we didn’t even have a forklift because we didn’t have a warehouse. We just worked out of the truck yard, but things grew.

“We evolved from a ‘truck and a con-note’, taking goods from A-to-B. Now we have warehousing and distribution. We have sophisticated freight management systems and equipment with cameras and telematics - lots of real-time data happening. We’re across the whole supply chain.”

SRT started by renting forklifts from another brand, however, after some problems turned to Toyota Material Handling Equipment Australia (TMHA).

“Our old gear was sort of dying and running out,” said Mr Miller. “Then we met (TMHA’s) Rodney Jones and the business ended up buying four Toyota forklifts from TMHA. Hobart area sales manager Rodney Jones said from the outset it was clear that TMHA and SRT held shared business values, and similar expectations. “SRT doesn’t see itself as just a service provider to its customers.

More than that, it makes itself a true business partner,” said Mr Jones. “We at TMHA take a similar approach. We take the time to understand the details of our customers’ operations so we can help them with equipment solutions that best suit their specific needs and provide the most efficient and

economical outcomes. We call this Tailored Business Solutions and it is one of the cornerstones of the Toyota Advantage.”

With the first four Toyota forklifts performing strongly, SRT eventually decided on adding another 36 Toyota machines - comprised of Toyota 8FBN 2.5-tonne four-wheel and Toyota 8FBE 1.8-tonne three-wheel battery electric forklifts, 32-8FG 1.8-tonne four-wheel gas forklifts, Toyota BT LPE220 ride-on electric pallet jacks and BT LWE130 electric pallet jacks.

SRT conducted due diligence before making the decision, which was based on multiple factors. “We looked at the offerings from the main fork suppliers,” Mr Miller said. “In the end, it was a combination of our history and experience of the Toyota forks - the longevity and consistency of their performance - the pricing of the gear and the ability for our supplier to also meet our short-term rental requirements while the new equipment was on order. All those things went into the decision to choose Toyota Material Handling equipment.

Mr Miller said the performance of SRT’s first four forklifts was especially instrumental in TMHA being chosen for its latest order.

“The old machines performed really well. We never had any problems with those early Toyota forks. It’s been the most reliable material handling gear we’ve used, so I reckon that our history certainly helped in us making our decision to purchase the latest additions to the fleet.

“We had good longevity out of that equipment - we still have a couple of those kicking around 15 years later and expect to get the same or better out of the new machines. If you can get 10-15 years out of that type of equipment you’re doing well.”

Such feats of durability and reliability - another key Toyota Advantage - demonstrated by SRT’s first Toyota Forklifts is made more impressive considering the business operates constantly. “We’re pretty much run 24 hours per day, seven days a week and we have operated that model for most of the last 15 years,” he said.

For more information visit www.toyotamaterialhandling.com.au. ■ MHD MAY / JUNE 2019 | 45

Suitable for indoor and outdoor use, the EFG 6 Series electric forklift truck can carry up to 9 tonnes.

9T ELECTRIC J

ungheinrich‘s new EFG 6 Series electric forklift trucks can carry up to 9 tonnes at a load centre of 900 mm and are suitable for both indoor and outdoor use.

Jungheinrich already offers five EFG series. With the EFG 6 Series launched in 2019, Jungheinrich is complementing its portfolio of electric counterbalance trucks. The EFG 6 Series is especially designed for powerful performance applications in beverage and building material wholesaling or in mechanical engineering. With a load capacity of up to 9 tonnes and a load centre of 900 mm, Jungheinrich will now be offering one of the most powerful electric forklift trucks on the market.

"From now on the motto will be: big, bigger, EFG. Our EFG 6 Series brings concentrated power and maximum efficiency to our customers' warehouses and handles even the toughest jobs,” said Jungheinrich board member for marketing and sales Christian Erlach. "With a 9-tonne load capacity, the EFG 6 Series sets new standards. For our customers, this means maximum performance with minimum consumption."

asynchronous drive motors and two synchronous reluctance lift motors, the EFG Series 6 delivers maximum power with minimum consumption.

For the demanding customer requirements in this segment, the Series 6 comes as standard with the drive&liftPLUS service package.

With its heavy-duty hydraulic block, the electric counterbalanced truck promises maximum performance even with heavy attachments.

HIGHEST PERFORMANCE

LITHIUM-ION ADVANTAGE

The EFG 6 Series is available with both superior lithium-ion technology and proven lead-acid battery technology. Thanks to the sophisticated drive concept with two

The use of modern lithium-ion technology significantly reduces energy consumption compared to lead-acid batteries. Thanks to the option of intermediate charging and

46 | MHD MAY / JUNE 2019

LARGEST PORTFOLIO FOR INDIVIDUAL CUSTOMER BENEFIT Jungheinrich offers the EFG 6 Series in a total of 14 different truck models, thereby offering the largest portfolio in the high-performance forklift segment. Four different capacities of 6 - 9 tonnes, two load centres (600 mm and 900 mm) and battery sizes ranging from 1,240Ah to 1,548Ah allow the truck to be fine-tuned to adapt to any customer requirements. The standard version with a long wheelbase absorbs all bumps and ensures a high level of travel comfort. The compact versions are shorter and therefore more agile than anything else on the market.

maintenance-free operation, the lithium-ion battery powered EFG 6 Series can be used almost non-stop.

At the same time, all the power is fully available – over a very long service life.

WORKPLACE WITH COMFORT The EFG 6 Series is best equipped for tough outdoor use. It can penetrate areas that were previously the sole domain of IC motor forklift trucks.

To do this, the truck has a full cabin with air conditioning. The laterally movable driver's seat, which is unique among forklifts of this type, sets new standards in terms of ergonomics.

ASSISTANCE SYSTEM FOR MAXIMUM SAFETY An extensive range of assistance systems such as addedVIEW and zoneCONTROL ensure optimum safety for the EFG 6 Series.

All-round visibility is guaranteed by the addedVIEW assistance system.

From four cameras, the operator obtains a 360-degree view directly on his display. This allows for operation in confined spaces and increases safety. In the event of critical danger areas in the warehouse, zoneCONTROL intervenes and automatically gives the operator a warning signal.

For more information email enquiries@jungheinrich.com.au or visit www.jungheinrich.com/en. ■

MHD MATERIALS HANDLING AND MANAGEMENT

RELIABLE AVOCADOS

T

he reliability and user-friendliness of Crown forklifts and pallet trucks has made them an increasingly important part of one of Australia’s largest avocado producer’s sorting, packaging and distribution operations.

Coastal Avocados, located in central New South Wales, has boosted its 15-strong Crown material handling fleet with the addition of another new CD Series diesel forklift.

The company uses its mix of Crown diesel and electric forklifts to haul loads during the growing and harvesting phases and for despatching large quantities of avocados to market.

The company plants approximately 200,000 trays of avocados per year and markets around 600,000 trays of produce to customers including Coles, Woolworths and markets throughout Australia.

In addition to its own produce, Coastal Avocados packs produce from the Northern Rivers and as far south as the Hawkesbury Plateau. All stock is distributed throughout Australia from its central packing shed at Stewarts Point, where it is cooled to six degrees, graded, wrapped and palletised.

Owner Chris Nelson said the pace and volume of the operation means that reliability is the number-one factor when selecting material handling equipment.

“Because we need to service growers and markets on a daily basis, we need absolute reliability from our forklifts,” Mr Nelson said.

“We make use of Crown forklifts for growing and processing of avocados; every one of our farms has Crown forklifts on it.

“Our packing shed has several. We use diesels extensively outdoors, but in the packing shed we use an electric forklift for working in the cool rooms.

Reliability, combined with responsive support from regional Crown-owned branches, has helped Crown maintain a relationship with Coastal Avocados for close to two decades.

“I’ve been using Crown forklifts for around 20 years. We still have those two Crowns that we bought in our first year and they’re still running like brand new.

“Every couple of years we select another one or two and they’re just no trouble at all.

“The service back-up is just fantastic, you never have to wait for anything.”

Mr Nelson said another attraction of Crown forklifts was that their familiar design makes it easy for operators to use a variety of equipment.

“There’s one main characteristic that keeps us using Crown; they’re beautifully simple. Every one of our operators can jump from one truck to the next and not have any issue at all about what controls this or that and I regard that as absolutely paramount in terms of safety.”

“I would certainly recommend Crown to anyone in a similar industry.”

“

There’s one main characteristic that keeps us using Crown; they’re beautifully simple.

”

For more information visit www.crown.com. ■ MHD MAY / JUNE 2019 | 47

WAKE UP CALL: Supply chain leaders to build team capability

S

ydney: Australasian Supply Chain Institute (ASCI) has developed a program to equip its members with new skills to build capability for the future.

Established in Australia in 1963 as a not for profit organisation, ASCI facilitates and enables the development and professionalisation of the Australasian Supply Chain Community. The program includes free breakfast events around the country, leadership series, site visits, a national survey resulting in a podcast series and an annual conference, all in an effort to foster supply chain leadership.

ASCI’s annual conference, ASCI2019, will be the flagship event with a theme closely aligned to the program: Technology enabling human excellence in supply chain management.

According to Ivan Imparato, CEO, ASCI, there is scaremongering around how AI and robotics advances such as automated transport spells the end of the human supply chain workforce.

“Robots are creating opportunities for smart and adaptable supply chain operators to increase their work flow visibility, efficiency, output, make their customers

“

Robots are creating opportunities for smart and adaptable supply chain operators to increase their work flow visibility, efficiency, output, make their customers happier, reduce their costs, and free extra time in their work lives to create more value and really grow their businesses.

”

CONFERENCE: ASCI2019 When: 17-19 September 2019 Where: Pullman Melbourne on the Park Website: www.asci2019.com Contact: Akolade | Ph: 02 9247 6000 | E: info@akolade.co ASCI has followed its Smart Conference traditions and appointed an Advisory Board to ensure the conference delivers return on investment and meets the needs of our valued members. The conference theme will be revealed in the coming weeks.

ASCI CEO, Ivan Imparato, officially launches the conference in the context of the organisation’s focus for 2019. Watch our two minute video for more information.

48 | MHD MAY / JUNE 2019

happier, reduce their costs, and free extra time in their work lives to create more value and really grow their businesses, governments...” he said.

In a recent article “Devastating: Robots to take 6.5 million jobs” (AFR, 1 April 2019) Microsoft says business governments and workers are woefully unprepared for robots.

ASCI has invited Microsoft to a lively Q&A session on 1 May 2019 to kickstart this program for members.

“We’re keen to hear Microsoft share their views with our members because we agree that there is a lack of urgency, not at anyone’s fault, in implementing training plans to help people acquire the necessary skills to succeed.”

Launched today, in partnership with Six Degrees and Australian Food & Grocery Council is a member survey “What makes a great supply chain and how will the industry evolve in the future,” which allows for ASCI to listen closely to its members’ requirements.

“To make this program accessible to all our members around the country, we’re launching a podcast series to communicate the survey results in a casual format to complement our members’ busy schedules, proudly supported by one of our trusted partners, SYSPRO Australasia.”

Other events that ASCI is running around the country for this program include the ASCI Leadership Series to hear how successful leaders have built teams and grown their leadership skills and site visits, where ASCI Members can see robotics in action.

“ASCI has a responsibility to guide its members through turbulent times.

We’ve seen some major changes such as manufacturing moving offshore. Now, more than ever before, we are geared to grow the community as a profession,” said Ivan.

MHD ASCI

ASCI SITE VISIT SERIES 2019 9 JULY COCHLEAR, QLD

5 JUNE DRONE DEMONSTRATION, WA

Tour of Cochlear’s $15 million Newstead facility which manufactures the latest electronic components used in their implants. This is in addition to products and components used in the external parts of the cochlear implant system like sound processors.

The site launched in July 2018 where the company now has over 200 employees,

Mahmood Hussein, CEO, Global Drone Solutions is our guest drone pilot who will show and share the drone technology and its features fit for logistics solutions. In 2014 he founded Global Drone Solutions, a CASA approved drone pilot training organisation, that harnesses drone technology to solve both social and business problems and create new business opportunities.

11 JULY SCHNEIDER ELECTRIC, NSW Tour of Schneider Electric’s National Distribution Centre, Ingleburn, which is a brand new facility. Schneider Electric has been an industry leader in air circuit breakers with over 30 years of innovation with their Masterpact range which includes Masterpact M and NT/NW, which is assembled at the site.

ASCI GUIDED LEARNING SESSIONS TERM 3 Certified in Production and Inventory Management (CPIM) Part 1 7 weekly Thursday 1-3pm/7- 9pm AEST Commencing 18 July until 29 August 2019 Certified in Production and Inventory Management (CPIM) Part 2 13 weekly Tuesday 1-3pm/7- 9pm AEST Commencing 9 July until 1 October 2019

Certified in Logistics, Transport & Distribution (CLTD) 13 weekly Thursdays 9.30-11.30 AEST Commencing 9 July until 1 October 2018

TERM 4 Certified in Production and Inventory Management (CPIM) Part 1 7 weekly Tuesdays 1-3pm/7- 9pm AEDT Commencing 8 October until 19 November 201 9

Certified Supply Chain Professional (CSCP) 13 weekly Wednesday 1-3pm/7- 9pm AEST

Certified in Production and Inventory Management (CPIM) Part 2 13 weekly Thursdays 1-3pm/7- 9pm AEDT

Commencing 10 July until 2 October 2019

Commencing 12 September until 5 December 201 9

Registration: events@asci.org.au

ASCI Practitioner Registration is now available.

Visit: asci.org.au/registration

Join our community by registering to our newsletter via our website, to receive valuable content, webinars, news and participate in forums or networking events.

1300 557 175 | enquiries@ASCI.org.au | www.ASCI.org.au MHD MAY / JUNE 2019 | 49

MHD NEWS FROM SCLAA

LET US FOCUS

T

AMANDA O’BRIEN

“

SCLAA is pleased to announce the launch of our online skills analysis platform, a free skills gap analysis tool for supply chain & logistics professionals.

”

50 | MHD MAY / JUNE 2019

here are many changes and developments that have transpired within the supply chain in 2019, however it is important at this time to concentrate on issues that affect all of us: discrimination, multiplicity and our humanity. In all these facets of life they are part of the human supply chain, the allimportant link between people. People make up our networks! In the case of the tragic Christchurch mosque massacre that claimed 50 lives, it is a stark reminder of how the fabric of our society relies on people, and multiple streams of people, working together and encompassing our differences even more than our similarities.

As our supply chains become more complex and evolved, we endeavour to solve challenges not experienced before and we need to evolve not just with technological automation, increasing efficiencies and juggling the regulatory and economic changes in our society, but as people we also need to evolve and expand our horizons with new ways of thinking and processing these differences to tackle the challenges before us.

It is important that we acknowledge how in the midst of tragedy, Prime Minister Jacinda Ardern’s leadership, compassion, acceptance of differences and zero tolerance for racism or discrimination of any kind, were able to bring together not only the country but the entire world. As in life, our supply chains contain many moving parts but we have to align all the complexity in different streams to complete the utopian end to end supply chain circle, just as we strive for our own utopian circle in life.

Our reliance on all our trading partners and developing these ties is critical to our economic security. Our teams understand the importance of this cultural diversity that has resulted in alliances with networks in the supply chain arena from not only China but all over the world.

Our colleagues in Hong Kong and Australia signed a Free Trade Agreement and Investment Agreement in March. The agreements were signed by Hong Kong’s Secretary for Commerce and Economic Development Edward Yau, and the Australian Minister for Trade, Tourism and Investment Simon Birmingham in Sydney.

On the economic front, local and global unemployment is lower and domestically we’re seeing big infrastructure and mining

projects. On the downside, the European economy is slowing and Brexit’s full impact remains a matter of speculation.

HAVE YOU GOT THE SKILLS? SCLAA is pleased to announce the launch of our online skills analysis platform. This is a free skills gap analysis tool for supply chain & logistics professionals. By answering a series of questions you can assess your skills and further develop the key capabilities and behaviours required to progress your career.

The capabilities assessed include inventory control, supply planning, demand planning, transport, order management, warehousing, manufacturing, legal contracting, financials and project management. The benefits of this include benchmarking your capabilities against the supply chain profession; gaining insights into your career journey and expertise; discovering the skills you need to progress your career; and receiving a personalised report on your results, which include e-learning recommendations. Go to www.sclaa.skillsgapanalysis.com to register.

WOMEN OF LOGISTICS The SCLAA International Women’s Day Breakfast held at Ryne Restaurant in North Fitzroy on 8 March was a great success. Our guest speaker was Marie-Claire Ross, and she gave an inspiring speech focused on the business case for trust, how to gauge low trust indicators that sabotage organisations and teams and the six essential building blocks for trust. The speech highlighted that trust is essential and without trust, you generate a dysfunctional organisation.

Two upcoming events of note are the SCLAA Women in Logistics Luncheon in Melbourne on 30 August and the 59th Australian Supply Chain and Logistics Awards Gala Dinner on 22 November at Luna Park in Sydney. For information on the Award categories, criteria and a link to the online submission form, go to: www.sclaa.com.au/awards.

There are many more interesting SCLAA events and announcements coming out in the next month, so for more information head to our website at www.sclaa.com.au.

Amanda O’Brien is the national chairwoman of the SCLAA. For more information contact the national secretariat at secretary@sclaa.com.au or call 1300 364 160. ■

2019

Call for Submissions NOW OPEN Submissions Close on 30 August 2019

2019 AWARD CATEGORIES Information Technology & Management Award Inaugural Award 1994 . Dedicated to the late Len Smith FAIMM.

Training, Education & Development Award Inaugural Award 2002. Dedicated to the late Professor Peter Gilmour.

Supply Chain Management Award Inaugural Award 1984. Dedicated to Doug Beattie.

International Supply Chain Award Inaugural Award 2016.

Environmental Excellence Award Inaugural Award 1966. Dedicated to Mr Ken Pike.

Industry Excellence Award

Inaugural Award 1987. Dedicated to Mike Munns, FAIMM.

Future Leaders Award Inaugural Award 2009. Dedicated to Vince Aisthorpe.

Online Submission Form:: http://bit.ly/2019ASCLA Finalists to be announced: 2 October 2019 Winners to be announced: 22 November 2019, ASCL Awards Gala Dinner, Luna Park , Sydney View highlights of the 2018 Awards: http://bit.ly/2018ASCLA_Video.

1300 364 160

secretary@sclaa.com.au

www.sclaa.com.au

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