JULY/AUGUST 2010
THE MAGAZINE FOR GLOBAL SUPPLY CHAIN LEADERS 一本为全球供应链管理人士倾力打造的专业杂志
Thin Ice 如 履 薄 冰 The Facts behind the Foxconn and Apple Crisis
富士康和苹果危机的幕后真相
PROFESSIONAL DEBATE专业辩论 IS CHINA READY FOR LEAN?
对于LEAN中国准备好了吗?
SOUR DOUGH
LOGISTICS UPDATE
DEBT AND LAWSUITS FOR PAUL BAKERY 债务官司缠身的PAUL’S
FROM THE MOUTHS OF THE EXECUTIVES
酸面团
物流进化论
物流主管说当今物流
Land of Opportunities Offshore Sourcing and Supply Chain Management
机会之地 海外采购和供应链管理
China has emerged as one of the leading low cost markets for global sourcing. However, the recent economic downturn has created unprecedented risk for businesses and their supply chain managers. Companies that are sourcing offshore have always needed to consider procurement holistically to be successful. Today, supply chain managers must be cognizant of a large number of risks that are difficult to detect in any market – but even more so in less developed markets. Gaining insight to and mitigating risks in this market requires a different set of tools than in a past. However, if managed effectively the opportunities and benefits remain achievable.
中国是全球采购重要的低成本市场之一。然而，当前全球金融危机 给公司及其供应链经理带来了空前的风险。 实施全球采购的公司必须通盘考虑以确保采购成功。当今，供应链 经理必须认识到在任何市场都存在大量难以觉察的风险，尤其是在 发展中国家的市场中。洞悉和管控风险需要用与以往不同的方法， 同时有效管理仍然可以带来吸引人的机会和收益。 普华永道利用其全球视野和本土知识经验，为企业提供创新的，切 实可行的解决方案，并为企业拓展业务和实现可持续发展提供新的 机遇。
With our global insight and local knowledge, PricewaterhouseCoopers provide innovative and practical solutions to address these key business challenges and turn them into opportunities to expand your business and result in sustainable growth.
了解更多的业务范围，请访问普华永道网站：pwccn.com，或联系：
To find out more on how we can address your needs, please visit pwccn.com or contact:
Damon Paling 电话:+86 (21) 2323 2877 电子邮件:damon.ross.paling@cn.pwc.com
Robert Barrett Tel: +86 (21) 2323 3818 Email: robert.barrett@cn.pwc.com Damon Paling Tel: +86 (21) 2323 2877 Email: damon.ross.paling@cn.pwc.com © 2009 PricewaterhouseCoopers. All rights reserved. “PricewaterhouseCoopers” refers to the China firm of PricewaterhouseCoopers or, as the context requires, the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.
Robert Barrett 电话:+86 (21) 2323 3818 电子邮件:robert.barrett@cn.pwc.com
Publisher: China Supply Chain Council Ltd. (Hong Kong) CHaINA Magazine is a FREE bi-monthly publication for the members of the Council. There is no charge for members and qualified readers to receive subscriptions in China. For your free subscription, extra copies or address changes, please email subs@supplychain.cn 出版商：China Supply Chain Council Ltd. (香港) CHaINA杂志是为Council会员准备的免费杂志。我们协会会员 和高质量的读者都可以免费订阅。为了及时收到我们的杂 志，额外订阅或地址变更请发邮件至subs@supplychain.cn
Office and Team: Publisher Max Henry Chief Editor Monica Liau Art Director How Xu Graphic Designer Acco Fang Photographers Jimmy Kim
Contributing Writers Dave Henshall, Geofrey Master, John D. Van Fleet, Rosemary Coates, Eileen Chow, Frances Karamouzis, Herve Le Faou, Ryan Dourado Translation YiXiu Wu, Sharon Yu, Patrick Zhou, Pauline Zhang
CHaINA Magazine is the only bilingual supply chain and logistics magazine in Asia with a strong focus on Greater China. In every issue, we write about the news, trends and best practices that will help manufacturers, retailers and distributors make better business decisions with their sourcing, production, logistics from, to or within Asia. CHaINA是亚洲地区唯一一本专注于中国的供应链和物流行 业的双语杂志。在每一期，我们通过刊登新闻，行业动向 和实践经验来帮助制造企业、零售商和发行商进行亚洲内 外的采购、生产和物流形式的选择。
Distribution: 10,000 copies 6 times a year CHaINA Magazine is offered FREE of charge by direct post mail to qualified readers in Greater China who are involved in all aspects of supply chain management. It is also distributed through selected locations in major Chinese cities, including hotels, restaurants, service offices/apartments, business centers, airport lounges and other key locations. 发行量：一年六期，一万本 CHaINA杂志通过直接向中国各供应链管理的专业读者发送 邮件来提供免费的阅读机会。同样也分发到中国的主要城 市并在酒店、服务楼，商务中心，机场大厅或其他中心地 带免费赠阅。
Target Readers Our target readers are R&D, sourcing, procurement, manufacturing, logistics, warehousing, transportation, retail, distribution and operations managers, directors, vice presidents and decision makers. A majority of our readers are end-users shippers, mainly foreign-invested and local manufacturers and retailers. 目标读者 我们的目标读者有来自采购、制造、物流、仓储、运输、 零售和分销的运营经理、总监、副总裁、或总裁。大部分 读者是物流的需求者，外资或国内的制造企业和零售商。
Subscription for Overseas Readers If you are located outside China, you can subscribe to this independent and insightful magazine today with full online access for only US$ 50 for 6 issues per year. For subscription inquiries, please contact: subs@supplychain.cn Stories Ideas, Comments & Feedback If you have an idea for a story, interview or case study, please contact the editor. We welcome feedback and comments about our content or any issues relating to supply chain management in Asia. Please email editor@ supplychain.cn 反馈和意见 如果您有任何新闻故事、采访或实践案 例，请与我们主编联系。如果您就杂志 内容或亚洲供应链管理有任何的意见、 建议或新鲜资讯，请发邮件至 editor@ supplychain.cn与我们取得联系。
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THE MAGAZINE FOR GLOBAL SUPPLY CHAIN LEADERS
It’s difficult to approach sensationalism with the right sense of balance, but that is what we at CHaINA have tried to do for this past issue, even in the face of some rather attention-grabbing news. The daily news has been throwing around disturbing Foxconn tales of suicides, worker dissatisfaction, bad CSR and unstable supply chains. Apple has been indicated and criticized in their role, along with several other major electronics Monica Liau brands like Dell, Sony and Amazon. While all this Chief Editor news could make outsourcers shake in their boots, it’s CHaINA Magazine important for us to delve beneath the surface of general public understanding. John D. Van Fleet has interviewed over 13 different sources from Foxconn, Apple, Quanta along with other major voices and researchers from the field. His conclusions bust up some of the myths flying around the face of Chinese manufacturing. In another disquieting story, CHaINA follows the debt-riddled path of Paul Bakery in China, a subsidiary of respected French bakery owners, Holder Group. While foreign businesses often talk about the difficulty of jumping the cultural gap and working with Chinese ventures, Paul’s is being torn apart by a fellow French company, Levillair Group. One source has estimated total debt at around 1.2 million Euros. How has it been possible for Holder Group, a traditional and tight knit family organization, to let this problems get so out of hand and affect so many different parties in perhaps one of Paul’s most important market? Enjoy the hot months with some of the hottest stories of the season. 要保持新闻不哗众取宠是比较难的，但这正是CHaINA杂志一直努力做的， 即使是一些非常让人震惊的新闻。每日新闻一直报道令人不安的自杀，员工不 满，糟糕的企业社会责任和不安定的供应链问题。苹果和其他一些品牌例如戴 尔，索尼和亚马逊在其角色方面一直都被质疑和批评。所有这些新闻都会让外 购员担忧害怕，所以对于我们来说深入研究大众理解的表层现象是非常重要 的。John D. Van Fleet 已经采访过来自此领域富士康，苹果，广达等超过13个不 同渠道的采购员和其他主流的研究者。他的研究结论揭开许多中国制造业的神秘 面纱。 在另外一则故事中，CHaINA调查了作为Paul’s法国分公司在中国的负债问 题。外国企业经常说要忽略文化差异和中国企业合作是一个困难，Paul’s已经被 法国Levillair同类公司所瓜分。其中一天消息来源声称Paul’s总负债已经达到了 120万欧元。一个传统紧实的公司怎么会容许让事态发展到这个程度并且影响的 Paul’s最重要的市场？ 请尽情享受这个季节所呈现给你的最热门的新闻故事。
DISCLAIMER Editorial and advertising are independent and do not necessarily reflect the views of the Council, the board, its members or the staff. While every efforts has been made to ensure accuracy, the publisher is not responsible for any errors. Views expressed by writers or contributors in this magazine are not necessarily those of the publisher. The publisher is not responsible for product claims and representations. @ Copyright China Supply Chain Council Ltd. (Hong Kong). All rights reserved The contents of the magazine may not be reprinted in whole or in part without the permission of the publisher. No part of this publication may be reproduced without written consent of the copyright holder. CHaINA is a registered trademark of the Global Supply Chain Council.
JULY/AUGUST 2010
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FEATURE 16
26
Rumors and truths about Foxconn and its’ clients
Going Up
Interview with Marc Magistrali, KONE elevators
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37
Thin Ice
JULY/AUGUST 2010
22
Sour Dough
Logistics Update
Executives in the field speak up about changes, challenges and the future
Paul Bakery’s debt ridden franchise
34
Eco-Ships
The future design of cargo movement
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THE MAGAZINE FOR GLOBAL SUPPLY CHAIN LEADERS
JULY / AUGUST 2010
CONTENTS FIRST:
06 The Frenzied Pitch China actually did make it to the World Cup 2010
NEWS Roundup
56 A Matter of Cost A comparison of labor prices in China and India 58 Toilets and Drains How Nan’an affects your everyday needs
08 Key stories impacting logistics and supply chain management in the Asia region
59 Big and Small M&A and its effect on procurement departments
11 What the English Media Missed A look at what the Chinese media is saying about logistics and supply chain management
SPONSORED Feature
COLUMNS
EXECUTIVE Appointments
13 Cloud Computing A Whether Update
LIFE
12 Taming the IP Dragon Corporate Practices
M&A
15 Want It? Got It. The latest Chinese mergers and aquisitions
PROFILES
16 Ultimate Flexibility Interview with David Simchi-Levi, MIT
FEATURE
48 Professional Debate Is China ready for Lean?
FOCUS
60 Central Thinking Implementing Chinese domestic shared procurement service centers
63 With talent at a premium, CHaINA keeps an eye on which executives are moving where.
64 Book Review: Dead Duck or Shining Star? Dissecting Nokia with Daniel Steinbock 65 Breakfast Discussion Product liability and you 70 Cocktail Mixer Under the stars at the Global Supply Chain Mixer 62 CLASSIFIED 65 COMPANY
LISTINGS
INDEX
54 Doing It The rise of the Chinese sports brands
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JULY/AUGUST 2010
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FIRST Word
FRENZIED PITCH China may not have made it into the bracket list of this year’s FIFA World Cup, but that doesn’t mean they aren’t part of the South Africa games. The deafening, droning cry of millions of vuvuzelas, (the official horn made for the South African games) have been blasting their way into the public consciousness and the player’s concentration, 90% thanks to manufacturers in Southern China. Demand for these ear-blasting instruments is not just centered in South Africa. The World Cup match between South Korea and Greece on June 19th was watched by a total of 24 million Chinese. While many of the viewers can’t make it to the games live, the demand for the trademark World Cup horns has skyrocketed in the past month. South African workers and activists alike have been enraged at the amount of World Cup related memorabilia was manufactured outside of South Africa, which they say is drawing profits away from local businessmen. However, despite high current market demand, Chinese manufacturers have a profit margin of less than 5%. Most of the profits go into the pockets of overseas distributors and exporters instead of to the workers themselves. .
5 1 million
COMPANIES in the whole China market are licensed to make the horns, with production mainly located in Ningbo, Zhejiang and Shantou, Guangdong.
VUVUZELAS
were sold by the Jiying Plastic Product Company alone in the first four months of 2010, mainly to South Africa.
RMB0.6 RMB2 RMB20
is the average manufacturing
is the average wholesale price of each horn
is the average asking price for vuvuzelas on Taobao, which has sold thousands of the trumpets.
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JULY/AUGUST 2010
Imaginechina
price of each horn
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June 11, 2010. Soccer fans cheer during a celebration for the opening of the 2010 World Cup inside the South Africa Expo Pavilion in Shanghai, China.
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JULY/AUGUST 2010
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NEWS Roundup
NEWS ROUNDUP Qualcomm sets up R&D in Shanghai Qualcomm Inc has invested several million dollars in order to establish a research and development center in Shanghai focusing on chips for “qualified and affordable” 3G handsets. Qualcomm will also strengthen cooperation with Chinese partners to launch products such as high-end smart phones, smart books, and small-size laptops with long battery life, to meet surging demand for 3G models and portable devices in China.
its market share to about 19% from 12% in 2008.
Foton plans Indian vehicle plant by 2011 Major Chinese truck maker Beiqi Foton Motor Co, a Daimler AG partner, is considering building a manufacturing plant in India capable of making 100,000 vehicles annually. The company aims to start manufacturing in India as early as 2011 and may bring its entire range of products, including light and heavy trucks as well as sport util-
ity vehicles to the country. They say that eventually, after starting production for three to four years, Foton expects to reach their manufacturing capacity of 100,000 units a year. It is unclear whether Daimler, which has a truck manufacturing venture with Foton in China, is involved in the project.
Nippon Express to build new warehouse in Vietnam Nippon Express (Vietnam branch) recently held a ground-
breaking ceremony for its new warehouse in the Song Than area of Binh Duong Province on the outskirts of Ho Chi Minh City. Nippon considers Vietnam the best candidate for production sites in its China-plus-one strategy. The Song Than Logistics Center, which is now under construction will feature a general and a bonded warehouse . Both will have air conditioning and refrigerator facilities, as well as a hazardous goods warehouse, allowing NE Vietnam great flexibility to supply logistics needs.
New car plant to be located in Foshan FAW Volkswagen has agreed to locate its’ new RMB8 billion (US$1.17 billion) plant in Foshan, Guangdong Province. According to an industrial outline issued by Guangdong Province, the joint venture between FAW Group Corp and Volkswagen will build a plant capable of producing 300,000 units in Nanhai District. At the end of April, Volkswagen AG announced it would invest another 1.6 billion Euros (US$2.1 billion) in China to build two new plants and launch new models to meet rising demand. Volkswagen plans to boost sales from 150,000 units to 500,000 units in South China within three to five years to raise
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JULY/AUGUST 2010
Agility Opens Logistics Hub in Shanghai On June 10th, 2010, Agility celebrated the opening of one of the biggest logistics facilities in China. This 66,000sqm hub will receive and distribute up to 600,000 tons of polyolefins annually from Borouge’s plant in Abu Dhabi, UAE. Agility Abu Dhabi designed, constructed and owns this facility and will manage operations and distribution to the Asian market over the next 10 years. The Shanghai Logistics Hub will receive polymer resins in bulk containers directly from the Borouge Middle East gateway situated at Ruwais in Abu Dhabi. These polymers are used in a wide range of applications including pipe systems, wires and cables, automotive components and advanced packaging as well as household white goods. Adjacent to the Logistics Hub is a 30,000 sqm Compound Manufacturing Unit (CMU), which produces 50,000 tons of polymer compounds each year. Agility Abu Dhabi, a joint venture between Agility, Mubadala Investment Company and Al Dahra, designed the building infrastructure and service connections that support the CMU. Borouge is a joint venture between Abu Dhabi National Oil Company (ADNOC) and Borealis, a leading provider of chemical and innovative plastics solutions.
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NEWS Roundup
Logwin Expanding Logwin, a global leader in air/ocean freight and logistics services, is upgrading and expanding its facilities in Shanghai as demand grows in China for value added logistics services in the fashion retail sector. The company has moved to the 6,000 sqm CFS centre in the Lingang district of Shanghai, which is close to the deepwater Yangshan Port. They have also established a 2,000 sqm logistics facility in Baoshan in the north of Shanghai. The Baoshan facility will be primarily focused on serving Logwin’s fashion retail clients where a full range of value added logistics services such as quality checking, price tagging, sorting, labeling, scanning and pick and pack are offered.
DHL invests in fashion logistics in China
GIC to launch US$700 million IPO
DHL is looking to capitalize on the fashion and apparel logistics industry in China, estimated at US$7.5 billion per annum. The company is enhancing its supply chain solutions, infrastructure and human resources to cater to rising demand of faster, more efficient door-to-door distribution in the multi-billion dollar industry. China is a key growth driver for the industry in the North Asia Pacific, with the region producing and exporting more than half of the world’s fashion and apparel goods. North Asia Pacific made up 66% of the global airfreight export last year, while ocean freight constituted 54% of the global fashion and apparel export market.
Singapore’s biggest sovereign wealth fund GIC. UL is looking to kick off an initial public offering of its logistics business around the fourth quarter of this year in order to raise at least US$707 million. It is set to be the biggest IPO in Singapore since CapitaMalls Asia and will allow the world’s fourth-biggest sovereign fund to raise cash for further investments. The IPO will include assets in China and Japan that GIC’s real estate unit bought from ProLogis (PLD.N), one of the world’s biggest warehouse owners and developers, and some third party assets. GIC RE manages a multi-billion dollar global portfolio of property assets, with over 200 investments in more than 30 countries.
open 400 more stores in China by the end of next year, as the giant country is one of its’ biggest customer bases. In addition, four new Watsons retail units will be built in Jusco outlets, a department store chain owned by Japan’s Aeon Co. Under the “1,000 Stores in 100 Cities” plan, the company is planning more than 1,000 stores in 100 largeand medium-size cities in China by the end of 2011, including second and third-tier cities. .
Metro AG to open 100 consumer electronics stores in China The German company has teamed up with Taiwan-based Foxconn Technology Group in a 200-million-dollar joint venture to bring Media Market, Europe’s largest retailer of consumer electronics.
Watsons unveils big expansion strategy A.S. Watsons & Co Ltd, owner of the largest health and beauty retailer in Asia, plans to
Correction Notice: In the May/June edition of CHaINA magazine, we would like to note that on page 24, the titles of Mr. Michael Romeri and Mr. William Li are switched. Mr. Li is the GM and Group Vice President, while Michael Romeri is the Executive Vice President. Also note that in the Chinese version on page 23, the Chinese title for Emptoris, “安普特瑞斯” is not the official Chinese title and should have been left as “Emptoris.”
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NEWS Roundup
Alibaba starts loaning to its clients Taobao representative Zhao Jingpeng, announced that their parent company, Alibaba will now provide small loans (below RMB 500,000) to Chinese entrepreneurs and smallto-medium-sized enterprises. Alibaba aims to serve the grassroot users to meet their financing demands for operation expansion and to support the development of these entrepreneurs and SMEs. In June 2007, Alibaba group teamed up with China Construction Bank and Industrial and Commercial Bank of China to provide loans to SMEs. Over the past three years, Alibaba and the two banks have jointly provided CNY12.8 billion loans to SMEs.
ANY NEWS YOU THINK WE CAN USE? LET US KNOW WHAT YOUR COMPANY IS DOING
CHaINA Magazine is always looking for updates and news from its readers. If you think your company is doing something that is interesting to others, help us help you get the word out. Contact us at editor@supplychain.cn to submit a story or to get more information on guidelines
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JULY/AUGUST 2010
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NEWS Roundup
MBA-Supply Chain Club in Xiamen
Xiamen distribution system expanding
BMC Software moves towards SCM
The Xiamen University Management School will be setting up an MBA Supply Chain Club; the first of its kind in China. The club is organized by the MBA center and is looking to attract professionals and scholars in the field along with students who are interested in SCM. As a non-profit organization, the club aims to push forward the development of SCM in the area by encouraging academic studies and corporate practice to come together. The club now has 30plus members who are SC managers from major companies.
Xiamen has announced plans to build up a pan-city distribution system based on E-business to provide logistics services to the whole of west Fujian province. Currently, the government has invested RMB25 billion in logistics projects which are already under construction. There are 2300-plus logistics firms and 33 projects already located in the city. All the investments are focused on one complete industrial pattern. In 2015, Xiamen says it will finish their Haixi Economic Center Logistics Center and become a regional shipping center
BMC, which provides IT management and automation software, has been moving its products towards cloud computing. The SaaS version of Remedy will tie into BMC’s configuration management database that tracks the technology components within an enterprise. BMC is targeting big companies with separate IT departments who help with supply chain management, especially by synching the distribution of different company branches. BMC is especially targeting retail.
Cold chain hospitality Jinjiang International Holdings Co., Ltd and Mitsui & Co., Ltd. have officially signed a cold logistics joint venture project. The agreement requires the two parties to jointly invest RMB 250 Million, with a contract term of 15 years. The Jinjiang Group wants to use this venture to build an efficient and traceable cold supply chain which supports its hotel industry, decrease logistics costs and increases food safety.
What the English Media Missed SPAR establishes largest logistics center in South China SPAR, the worlds largest food retailer, has put its Guangdong Logistics Center into operation in the Hongmei area of Dongguan. This is the largest retail distribution center in Guangdong and covers an area of 140,000sqm. It is separated into offices, room temperature areas, low temperature areas, kitchens and docks (two 1000-tonnage berths). The center aims to improve purchasing ability, inventory control and cut down the logistics cost. According to sources, the maximum throughput of the room temperature warehouses is 100,000 boxes per day.
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Yuancheng Logistics opens seventh highway
Zhengzhou Haier Park
Suning and LG for green supply chains
The Changchun-to-Beijing Yuancheng Highway is now open for use. The Changchunto-Beijing route cuts the 1050km drive to down to 16 hours. This is the seventh highway that the Yuancheng group has built in the last eight months. Yuancheng Group plans to open 50 more highways by the end of this year, linking together all big and medium cities in China.
The Zhengzhou Economic and Technological Development Zone has signed an agreement with the Haier Group which marks the beginning of a new Haier (Zhenghzou) Logistics and Industrial Park. This enormous project will cover an area of 143,332sqm and will cost RMB300 million. The project had its foundation ceremony in June 2010 and is planned to be completed by the end of the year. Once completed, the park will provide the distribution needs of electrical appliances and IT goods for Henan Province and it surrounding areas.
The Chairman of Suning visited the LG headquarter in Korea to discuss a “green cooperation” between the two companies. Both sides announced plans to work together to create a green supply chain for their electrical appliances. Suning will jointly develop products with LG to be promoted into China’s market. This is not only part of Suning’s CSR campaign but by creating more mature energy-saving technology, more products will be put on shelves in Suning in the second half of the year. By doing so, the two companies hope to achieve their revenue goal of RMB10 billion by the end of the year.
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COLUMNS
Taming the IP Dragon
I David Henshall is founder of Purchasing Practic (www.purchasingpractice.com), a niche consultancy specializing in procurement. Contact him at dhenshall@purchasingpractice.com )
China’s loose IP regime has been key in the country’s growth; until Google, western businesses have been willing to trade 12
JULY/AUGUST 2010
Corporate Practices
ncreasingly , international manufacturers are motivated to be in China due to the growing domestic demand of the Chinese marketplace. It is easy to see why when you consider that last year, Chinese consumers bought more automobiles than Americans for the first time in history. Tim Lee, General Motors Shanghai-based president of international operations recently said that he thinks it won’t be long before GM will sell more cars in China than in its home market. However, despite this optimism, all is not well in Chinese – Western relations. Perhaps the most high profile case is that Google, one of the world’s most ambitious and recognizable technology companies, was willing to pull out of China; defying censorship regulations despite its 30% share of China’s internet search market. The key issue this action raises needs to be addressed by Chinese policy makers and must be rigorously considered by all global executives and risk managers who are seeking to do business in China. I am talking about intellectual property (IP) theft. Google’s allegation of state-supported IP theft raises questions about the ability of any business to safeguard IP in China and just how many companies avoid the Chinese market because they fear they could lose their most valuable assets; IP rights. China’s extremely loose IP regime has been a key element in the country’s growth, and until Google’s recent stand, western businesses have been willing to trade on these terms; balancing IP risk against their own short- and long-term business development goals in China and Asia. However, I argue that western businesses will increasingly develop duel strategies to balance their regional sourcing goals in order to harness low cost sourcing requirements with alternative strategies for gaining access to domestic Asian markets. One such strategy will be India. According to a study performed by the London
School of Economics, both India and China are capable of world class manufacturing processes. The study on the supply chains of the two countries’ automotive industries, found that two-thirds of their domestic suppliers were able to meet western quality standards and have a large sub contract base to outsource component manufacture. The recent flow of major global companies setting up sourcing operations in India emphasises India’s growing attraction as a manufacturing base for western companies: Fiat and Chrysler, BMW, Ford, and Jaguar Land Rover have all recently established India sourcing; Walmart is looking to make India a major sourcing hub and Atlas Copco set up global sourcing in India India is now in the early stages of a manufacturing revolution of the kind that China commenced in the 1990s, and it is increasingly seen as a viable alternative to China for sourcing manufactured goods. Add to this that India, with its legal system roots planted in English law, is seen as a much safer environment for international firms to protect IP, and India could become a serious threat to China’s manufacturing dominance. Also, as trade between China and India continues to grow to be one of the world’s largest trading blocks, India could become the Asian base of choice from which western companies centre regional market strategies and also gain access to the huge Chinese market. To address this challenge I argue, China must tame the IP dragon in two ways; tighten its IP regulatory framework to protect western investment , whilst also continuing to internationalise via M&A, and cooperation, to secure its own IP. The internationalisation route has already been followed by Huawei Technologies, Haier, Sun Tech Solar and Chery International, and more recently by Geely’s $1.8bn acquisition of Volvo. In this way China can tame the IP dragon and maintain its country of choice position amongst western companies in the long term.
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COLUMNS
Cloud Computing
E
veryday it seems we hear something about cloud computing. As a topic, it pops up everywhere. Industry experts describe its paradigm shifting potential for customers, while major suppliers are buying up companies with cloud related capabilities while proclaiming astronomical business potential. Everyone seems to be offering some variation of service. It has been around for years, but suddenly it is being identified as the top strategic technology for 2010. Something is going on. What is it? Definitions abound, but a common element of all cloud computing definitions is that it involves the provision of services over the Internet, thus deriving its name from that fluffy Internet cloud appearing in technical diagrams. Beyond this, details diverge and are frequently driven by the perspective of the definer. Frequently, definition efforts launch into descriptions of characteristics of cloud computing, citing: • scalability – the consumer uses as much or little as needed at any given time; • full management by the provider, so the consumer needs only device with access to the Internet (which usually entails a browser); • charges relating to use, frequently time. That may be exciting, but it is not all that new. Talk is actually being driven by the explosion of service offerings and service providers, a mix that is changing the way customers approach and contract cloud computing services. The service offerings involve software as a service; platform as a service; and infrastructure as a service. The service providers include the familiar companies, but also include your search engine provider, your telecoms
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A Whether Update
provider and even your book and consumer product seller, each vying to sell you often sophisticated services in the simplest of ways. Who cares? Of the many benefits to cloud computing, technical advantages are frequently first noted. These include on-demand computing services, saving time and money by avoiding investment in hardware, software, network infrastructure; and pooled computing resources across multiple users, so fluctuations in demand are more easily met. There are operational advantages which increase opportunities for collaboration and knowledge sharing as files are available to any designated users from any location (with Internet access). Control of data can be enhanced, as the paradigm shifts from shipping data around to controlling access to data, and on a real-time basis. However, challenges are quite wieldy. The services contracting model, which has developed over many years to address significant concerns sufficient to allow third party services to be incorporated into business operations, is facing a tough go with cloud computing. Especially among the new breed of service providers with little outsourcing experience, suppliers are emphasizing low cost offerings and have limited capacity for or interest in contractual commitments or customer requirements. This situation requires customers to exercise significant judgment, diligence and restraint. Not all service / contractual arrangements fill all needs. On one end of the spectrum, some “nice-to-have” tools, routines and non-sensitive data may allow use of a standardized, low-cost cloud computing service with few contractual protections. A move toward the other end of the spectrum, such as toward mission critical data and applications, gives
Geofrey L. Master is a Partner at Mayer Brown JSM in Hong Kong. He specializes in sourcing transactions, including the outsourcing and offshoring of information technology and services as well as of business processes. You can reach him at geofrey.master@ mayerbrownjsm.com
Businesses that use cloud computing face several regulatory challenges, many of which are already legendary. JULY/AUGUST 2010
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COLUMNS
Ultimately, cloud computing is a variation of outsourcing, so many of the risks are the same ones faced for years in more traditional outsourcing.
rise to the need for security and predictably. Then there are the regulatory challenges, of which many have already become legend. Businesses involved in any kind of regulated activity face obvious risks, where restrictions on data disclosure, access and even location of storage will have to be carefully considered in the context of any cloud computing solution. Issues may rise under import/export control regulations as data moves around the cloud, often to non-identified locations and parties holding the data. Data retention and disposal requirements can present challenges in cloud computing. But the grand regulatory challenge by far relates to privacy and security issues related to regulating personal information. Customers must determine how to ensure compliance with these various laws and standards while taking maximum advantage of the benefits of cloud computing. Applying to the Supply Chain Cloud computing is also beneficial and risky for supply chain operations. With applications as diverse as customer relationship management, hu-
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man resources and accounting being made available through cloud computing offerings, supply chain organizations will increasingly face the appeal of obtaining powerful functionality without the time and costs of arranging for the people, applications and facilities required to do-it-yourself is absolutely huge. However, equally huge is for those organizations will be retaining requisite control of critical proprietary data, so that they have confidence that it will be where it needs to be, and won’t be where it shouldn’t or cannot be- whether such requirements are driven by business need or law. Such responsibility cannot be delegated and seeing to such needs will almost certainly require increasing judgment, discipline and, in some cases, powerful restraint. Ultimately, cloud computing is a variation of outsourcing. In this sense, many of the risks are the same as the risks faced for years in more traditional outsourcing. They also must be mitigated the same way – through successful navigation of appropriate due diligence up front, appropriate contractual protections that account for higher risk data and applications, and continuing vigilant governance.
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M&A
Want It? Got It.
Everyone was talking when Geely Automotive announced their acquisition of Volvo, but with Chinese M&A projected to hit a record high this year, there’s a lot more happening beyond automotive.
US$ 3.07
Jollibee even jollier Phillipines based JOLLIBEE Foods Corp. (JFC) continues to focus on overseas expansion by taking a majority stake in another chain of restaurants in South China. JFC will enter into Guangxi Zong Kai Food and Beverage Investment Co. (GZK) for the eventual joint ownership of San Pin Wang, a chain of 34 restaurants selling low-priced beef noodles. JFC will own 55% of the fast food chain, which has outlets in Nanning, Liuzhou, GuangXi, and the Zhuang Minority Autonomous Region in Mainland China. Its partner, GZK, will hold a 45% interest in the business. Under the agreement, JWPL will invest RMB 30 million ($4.39 million) to acquire the majority stake in the business. JWPL and GZK have also committed to jointly invest another RMB 20 million (US$2.93 million) in the fast-food chain for its expansion. The joint venture is expected to be fully operational by January 2011. Hitachi Transport System acquires Flyjac Logistics
Hang Seng Bank buys into Shanghai premises
Japanese owned Hitachi Transport System Ltd. a subsidiary of Hitachi Ltd, bought an entire stake in Flyjac Logistics for about US$55 million in cash. Flyjac has 650 employees and 19 warehousing locations in India. They are also the ground handling agent for AAI at New Delhi and Amristar.
Hang Seng Bank agreed to purchase about 7,000sqm of office and retail space, together with naming and signage rights for the building, in Shanghai’s financial district for RMB510 million (US$74.67 million).
US$1.6 billion Charles River buys WuXi PharmaTech Pharmaceutical research company Charles River, which is headquartered in Wilmington Massachusetts, paid US$1.6 billion in cash and stock to acquire Chinese outsourcing company WuXi PharmaTech, 2.5 years after the Shanghai-based company listed in the US. The new company will take on the Charles River name and offer an expanded portfolio of products and outsourcing services.
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billion
Sinochem heads to Brazil
E Ink agrees to
US$215 Million
Taiwan-based Prime View International (“PVI”), the world’s highest volume supplier of ePaper display modules, signed a definitive agreement to acquire E Ink Corporation, a leader in electronic paper display materials and intellectual property. Their goal is to grow business by over US$3 billion by 2013, citing the emerging popularity of e-reading material. Sources say the market for electronic book devices such as the iPad, SONY Reader and Amazon Kindle is forecasted to grow from 1.1 million units in 2008 to 20 million units in 2012, over 105% growth.
Sinochem Corporation agreed to buy a 40% stake in the Peregrino Brazilian oil field for $3.07 billion in cash, continuing a trend of Chinese firms seeking to meet the country’s demand for energy and commodity resources through overseas acquisitions. The seller is Norwegian oil and gas producer Statoil, which will retain the remaining 60%. The offshore oil field is located approximately 85 km from Rio de Janeiro in the Campos basin and is expected to start production in early 2011. This transaction is Sinochems largest foreign acquisition ever made.
Hong Kong-listed arm of China’s e-commerce firm Alibaba announced that billionaire investor George Soros is now among its top three largest shareholders. The legendary financier who founded Soros Fund Management bought shares in Alibaba. com in the third quarter of last year. Alibaba also reported that its firstquarter net profit jumped 34% from a year earlier to RMB330 million (US$48.34 million).
JULY/AUGUST 2010
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PROFILES
Going
Up
Marc Magistrali Senior Vice President, Global Sourcing Kone elevators
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PROFILES Magistrali recently moved to Shanghai to be closer to one of the worlds’ fastest growing markets. He talks to CHaINA about risk, commodities and managing more than 2 billion Euros of KONE’s global direct and indirect spend. Why has Kone moved the heads of the sourcing and supplier management organization out to China? China has become a key growth market for KONE, representing more than 50% of the global ‘new equipment’ (elevator and escalator) market. Mega-trends such as urbanization and the aging population (which requires more horizontal and vertical transportation) are key drivers spurring this growth for KONE and our industry. Additionally our China based suppliers are playing an increasingly important role in driving innovation as well as supply to our global operations. I have moved to China to ensure that we are well positioned to manage the enormous opportunities ahead of us, and although most of our global roles are still based out of Europe, this will increasingly shift to China based on our business requirements. How did you change your department when you moved to KONE in 2005? Before arriving to KONE in mid-2005, the sourcing organization was highly decentralized and sub-optimized. We have since transformed our sourcing and supplier management organization into a globally integrated operating structure working in alignment across more than 45 business units worldwide. Having globally harmonized processes, systems and ONE sourcing strategy has greatly enabled knowledge and spend leverage, and our team of more than 180 people has the principal reason for our significant contribution to KONE’s bottom-line as well as top-line business impact since 2006. Adoption of the category management business practice has also ensured cross-functional alignment with our internal business partners such as engineering and manufacturing so that we are all working to support our business requirements as well as common goals and targets. Part of sourcing is managing suppliers and fostering supplier development. Any tricks to the trade? As supplier management and development requires a significant amount of time and energy, a basic perquisite to effective supplier management is having a manageable number of suppliers as well as a clear segmentation process. We currently have less than 100 strategic direct material suppliers which represent approximately 80% of our global spend, having reduced our supply base by more than 45% since 2006. Having the right sourcing and supplier management capabilities is another fundamental ingredient to driving the right value from strategic suppliers. This is especially true when driving supplier development initiatives, as this requires the right level of experience and competence to continuously identify and ensure supplier pro-
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ductivity improvements. We also really focus on our Supplier Day (held this year in Shanghai) which brings together our strategic suppliers once a year and is also a key venue to strengthen the relationship with our strategic suppliers. We use this day not only to solidify our supplier relationships, but also to involve our top executives (including our CEO) as well as my peers such as the Head of Technology and Manufacturing, to communicate our business plans and direction. We do not use this venue to hammer our suppliers but rather celebrate our relationship. Other ‘tools’ we use to develop our supplier relationships, include quarterly supplier steering meetings, our certification process, and our 2010 priorities reflect our ongoing pursuit to continuously improve our internal business partner (category management, risk/ commodity management) and external partner (supplier development) relationships. Another key priority in 2010 is the roll-out of a ‘best practices’ integrated sourcing platform to ensure automation, transparency and continuous supplier performance in our journey towards sourcing excellence. Are most of your strategic suppliers in China or elsewhere? Most of our strategic suppliers have global operations to support our global manufacturing operations. Many of our strategic suppliers have been requested to establish operations in China to support our growth, undoubtedly also lured by the incredible market growth opportunity, whereby other suppliers have been locally developed. What would you say are some of the biggest challenges to you job? The volatility in the commodity and currency market as well as the global electronic components shortages are just some of the challenges we are currently managing. Fortunately we have developed relationships with some very capable suppliers as well as established robust systems that support us to properly manage and mitigate these risks. Our global commodity team for example filters multiple data sources, including past and current market trends, to establish meaningful future projections that we forecast against. We have also developed a system that was particularly useful in 2009 to continuously monitor the financial health of our supplier chain. The most important ingredient to an organizations success are its people, therefore ensuring that we continuously attract, retain and develop the best talent is both a positive challenge and tremendous opportunity. I am very conscious of the fact that leadership behavior, the right attitude and common values are the key factors to build a winning culture as well as a trust based, performance driven and fun environment to work in.
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PROFILES
更上一层楼
n Marc Magistrali 高级副总裁，全球物料资源 通力电梯
Magistrali最近将他的采购团队转移到世界市场发展势头凶猛的城市之——上海。在和 CHaINA谈起这个决定时，他也提到了其中的风险，包括产品调整和如何控制20多亿欧元直接 或间接的开支。 为什么通力提出将采购部的高层 主管调移到中国？ 中国的市场对我们很重要，特别是 因为它占据了超过50%的“新型设备”市 场—包括电梯，自动扶梯等。我们十分关 注城市化进程和老龄化趋势将带来越来越 多的人口向城市流动，电梯的需求势必会 增长。 此外，我们的中方供应商在我们整 个国际运作中担负着越来越重要的供应角 色。 此次我移居上海，就是为了确保 我们能更好的抓住眼前的巨大良机。 尽管我们公司的重心大都仍在欧洲， 但我们将不断的把重心调整到中国市 场以满足我们的业务需求。
要想从战略供应商取得最大的价值， 有能力做好采购与供应管理也是至关重要 的。当供应商发展成为动力因素是，这一 点就变得更加重要了，因为，做到这点需 要大量的经验和能力以保证明确供应商的 生产效率的提高。 我们每年都设定的供应商日也是我们 关注的重点。届时我们的战略合作供应商 都会齐聚一堂，联络交流。今年供应商日 的举办地点会在上海。我们希望能充分利 用这一天来牢固我们和战略供应商的合作
当您刚加入通力时，对部门的结构和 人员都做了哪些改变？ 当我在2005年中旬加入通力时，公司 显得十分分散。2005年开始，我们整 合了所有的采购与供应部门，讲起转 换成为45个协作联系的国际办事处。 通过全球范围的优化供销环节，我们 大大的提高了我们的信息传递，见傻 了成本支出。自2006年开始，我们的 180人的团队成为通力的主要力量，为 通力做出了贡献。 分类管理同样也保证了我们公司在业 内各职能部门间的合作，诸如工程， 制造业等，这样一来，我们就是通力 合作以支撑我们的业务需求及共同的 目标和理想。 采购的一个部分是管理现有供应商并 培养潜在的供应商。做好这两种工作有 什么诀窍吗？ 供应商的管理和发展需要大量的时间 和精力，而要想实现一个有效的供应商管 理模式的关键是数量数量合理的供应商和 清晰的过程划分。 我们现有不超过100家直接材料供应 商。自2006年起，我们已将供应商的支出 降低了45个百分比，而对前述100家的供 应商的支出占到公司全球指出的近80%。
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关系，也为了使我们的高管及我的好伙伴 加入到我们的活动中，一起分享各自的商 业计划和目标，而不是试图打击或压榨他 们，这绝不是我们的初衷。 我们拓展我们和供应商之间的联系 的别的途径还包括季度供应商大会，我们 的认证过程。我们2010年的优先权的安排 体现了我们要不断追求提高内部业务伙 伴（分类广利，危险/商品管理）和外部
业务伙伴合作（供应商拓展）关系的决 心。2010年我们工作的另一个重心就是推 出我们的最佳实践整合采购平台以确保我 们在通往最佳采购的道路上实现自动化， 透明化及不间断的供应商服务。 你们大部分的供应商都在中国吗？ 我们的供应商大都在国际范围运营并 为我们提供全球化的生产供应支持。我们 要求我们的众多供应商在中国开设营业点 以支撑我们的发展。当然，他们来到中国 也是被中国的巨大机会所吸引，而我们 也有一些供应商是在中国本土发展的 供应商。 您认为什么是目前工作中最大的挑战 呢？ 我认为，商品及货币市场的波 动，全球电子配件的短缺时我们常常 要面对的一些挑战。可喜的是，我们 已经和一些十分可靠的供应商达成协 作关系，同时，我们已建成前进的体 系以支撑我们合理应对并弱化危机。 例如，我们的全球商品团队会过 滤层层数据—这些数据包含了历史及 现有市场趋势----以得出我们能预期 的合理的设计方案。我们在2009年也 建立了一个十分有用的系统，用来不 断监测我么供应商联的经济状况良好 情况。 一个公司的成功的关键还是他的 员工，因此，确保我们能始终吸引， 留住和发展人才是一个巨大的挑战， 但同时又是一个绝佳的机会。我十分 清楚的是，要创造“赢家文化”，营 造一个以信任为基础，以业绩为动力的 有趣的工作环境的关键还是领导能力，正 确的态度及共同的价值理念。 通力公司是电梯制造及服务行业的 领军企业，年均收益为46亿欧元，旗下雇 佣35,000名员工。通力的宗旨是提供最好 的传动体验，积极提供解决方案使人们在 日趋城市化的环境下亦能便捷，安全，舒 适，及时的享受电梯传送。
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PROFILES
麻省理工， 工程师的摇篮
n David Simchi-Levi 麻省理工大学工程学院教授
David Simchi-Levi 在麻省理工大学教授博士，工商管理硕士及硕士学位的供应链管理课程，并建立了与上海交 通大学的合作项目-多领域供应链管理。现在，他要探讨值得企业关注的来自供应链的挑战。 作为应用数学的博士，您是如何 进入供应链管理这个教学领域的？
我是一个应用数学家，但我是早 在供应链这个理念尚未成形前就开始 着手研究了。在过去，当我为一些公 司工作并讨论供应链时，他们并不懂 得供应链的意义，而且说那只是后勤 办公室的人该处理的一些操作事宜。 现在供应链理念已经列为董事会的讨 论议程。还有在过去15年中，我有一 家专门开发供应链方案的软件公司， 这是一段很好的经历来帮助我辨别哪 些公司需要获得帮助， 也帮助我将案例分析 和确实性带入课堂， 并且精深我的研究项 目。
60%。增加库存的理由很简单，当运输 成本增加，企业尝试加大运送容量， 其影响对运输有利，但对库存不利。 还 有 一 些问题就是不断增长的风 险，供应链收到各种干扰，而这些都 是由于企业结构精简，过多依赖于采 购外包和离岸外包所造成的。还有就 是市场需求和商品价格的巨大浮动， 导致你对下个月的价格无从可知，面 对签订合同感到不知所措。最后，企 业们面临可持续性发展的压力，高管 们需要在未知的环境中管理供应链。
所以您现在的研究重点 是什么？
在近几年，我的 研究关注于经济变化 如何影响供应链应对 策略。我认为有6种主 要力量加增了主管们 管理供应链的压力。 首先，环球供应链拥 有较长的交付周期， 供应渠道往往充满存 货，所以公司在投资时必须注意不同 地域的设施和合伙人的相互合作。其 次，消费者需求不断改变， 以致增加 了提升服务质量的压力，当试图减少 存货时，你会变得不知该如何应对。 第三，人力成本每年在发展中国家持 续增长，近5年中，中国增长了20%， 墨西哥5%，美国3%；所以一家公司 如果在4，5年前制定的一揽子采购决 定，他们或许现在需要重新考虑了。 企业还必须解决由持高不下的能源价 引发的运输成本的上升。仅在美国， 过去5年运输总成本上升约50%，与此 平行的存货成本和水平, 平均增长了
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您最近给了一个关于运用“灵活性”，最 大化提升供应链性能的讲座，
灵 活 性 是企业们面对当今全球供 应链挑战时最主要的策略之一。企业 们若能在灵活性上下功夫，就能平 衡供求关系，提升服务水平，缩减成 本并更好得利用资源来提高供应链性 能。我刚完成了对100家企业关于在灵 活投资方面的调查。我们发现相对于 过去，在灵活性方面投资的企业越来 越多。长期以来，由于高科技产业周 转率很快，灵活投资一直是他们的专 长，而非大众消费品产业所涉及。但
现在，在调查的公司里，有超过50% 进行灵活投资。 在您看来，哪些公司贯彻灵活性有效率， 那些没有效率？
某些公司似乎着迷于一个供应链 的神话，尽管他们拥有多种产品，品 牌和渠道。这是个巨大错误!GAP就犯 了这个错误，他们旗下拥有三个品牌, Banana Republic 针对流行服饰，Old Navy 针对廉价服装，GAP 则是高端 休闲装.扮。三种品拍代表三种不同的 消费理念：流行注重速 度，Old Navy 注重低 价格和低成本，而GAP 是处于两者之间。所 以你需要三种不同的 供应链来应对挑战。 很多企业会说设置三 种不同的供应链太难, 但如果只有一种就 意味着只能是中庸之 道。 宝洁公司在这点上 作得很出色, 他们为不 同的产品大类打造相 对应的供应链，而且 还懂得利用从不同供 应链上获得采购，制造 和客服的协同效应。宝洁公司几乎制 造从美容用品到尿布的所有产品，但 他们懂得分部门来减少成本，提高效 率，也就是说你在拥有多种供应链的 同时也要找到它们的共通性。 戴尔公司也面临挑战。以往他们 依赖网络销售，但在发展中国家，顾 客往往希望先看到实物再买单，所以 真正的购买力是来自于零售渠道。戴 尔公司必须认识到网络和零售是不一 样的消费理念，所以你要有不同的供 应链策略。总之戴尔需要变革！有人 会想当然得认为戴尔会改变经营方式, 但是注意任何变革又不能操之过急。
JULY/AUGUST 2010
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PROFILES
assachusetts nstitute of echnology
School of Engineering David Simchi-Levi Professor
imchi-Levi teaches supply chain management on MA, MBA and PhD levels, and helped found the MIT partnership with JiaoTong University’s supply chain management program CLFM, where he is also a guest lecturer. Now, he discusses his list of challenges that companies need to watch out for in their supplychain. You have your PhD in applied mathematics, what drew you to supply chain management as a field of teaching? I am an applied mathematician, but I started working on supply chain issues well before it was called supply chain. When I used to work with companies and talk about supply chain they didn’t know what that meant and usually said someone in the back office dealt with these operational issues. Now [supply chain] has moved into boardroom discussions. Also, in the last 15 years, I had a software company which developed supply chain solutions – it was a good cycle that allowed me to identify what companies needed to help them address their challenges. It also helped me bring casestudies and credibility to my classroom and shaped my research program. So, what does your research focus on right now? Over the last few years, my research has been about how changes in the economy affect supply chain strategies. In my view, there are six main forces putting a lot of pressure on executives managing their supply chain. First off, global supply chains with long lead time suggests that supply chain pipelines are full of inventory, which also means that companies need to invest in collaboration between geographically diverse facilities and
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partners. Second, customer demand is shifting, and there is a lot of pressure to increase service levels but it’s not clear how you address this while minimizing inventory. Third, labor costs in developing countries are increasing – annually, the costs in China have raised 20%, in Mexico 5%, and U.S. 3% over the last five years – so if a company made a bunch of sourcing decisions 4-5 years ago, they may need to reconsider them. Companies also have to deal with higher energy prices which affect their transportation costs. In the U.S. alone, total transportation costs increased by almost 50% in the last five years – in parallel inventory costs and levels have increased on average by 60% for US companies. The reason for the increase in inventory is clear. As transportation increases, companies try to bulk up their shipping amounts – which is great for transportation but bad for inventory. The last few problems are increasing levels of risk due to companies going lean and relying more on outsourcing and off shoring, which implies a diverse supply chain open to all sorts of disruption. There is also a huge volatility, not only in demand but also in commodity prices, which begs the questions of what contracts companies should sign – you don’t know about prices next month . Lastly, companies are also facing pressure to
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PROFILES
become more sustainable – executives need to manage their supply chain in an environment that is uncertain You recently gave a lecture on the concept adapting “flexibility” to maximize supply chain performance, Flexibility is one of the major strategies that companies can take to address the challenges of the modern day global supply chain. Companies who invest in flexibility improve their supply chain performance by better matching supply to demand, increasing service levels, reducing costs and better utilizing resources. I just finished a survey of about 100 companies trying to figure out how many are investing in flexibility. We see more companies investing in flexibility in industries where before we never saw very many. For a long time, it was only hi-tech industries who were investing in flexibility, as their technology turnover was very fast, but it wasn’t necessarily part of the CPG industry. Now, over 50% of the companies surveryed reported investing in flexibility. In your opinion, which companies are implementing flexibility effectively and which ones are not? Companies sometimes seem to buy into the myth that they only need one supply chain, even if they have multiple products, brands, and channels. This is a huge mistake. GAP has made this mistake – they have three brands – Banana Republic (which sells
fashion items), Old Navy (low price clothing) and the GAP (highend casual wear). These are three very different brands with three different customer value propositions – fashion is all about speed, whereas Old Navy is more about low price and hence low cost and the GAP is somewhere in between – so you need three different supply chains to address each one of these challenges. Most companies would say – well, it’s too difficult to implement three different ones, but the problem with just having one is that a company finds itself basically responding to the average P&G is doing a good job - they have different supply chains for different product categories but also they take advantages of synergies between different supply chains in terms of procurement, manufacturing, customer service etc. They basically take cross sections to reduce costs, and increase efficiency – P&G does everything from beauty products to diapers – you need completely different supply chains while still finding points of commonality. Dell is facing some challenges. Their problem is that they’ve always been in the online business, but the real power today comes from selling to the retail channel – in developing countries, customers want to see the product before they purchase. The challenge faced by Dell is that customer value online is different from retail, so you need different supply chain strategies. Dell therefore needs to adjust their supply chain strategy. One could assume they will change, but you can’t do that very quickly.
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JULY/AUGUST 2010
21
FEATURE Retail
Sour
Dough Paul Bakery’s debt ridden China franchise
H
older Group, founded in 1889, owns seven prestigious brands in France. Their Paul Bakery chain has 750 stores in France and 100 worldwide, and is arguably the group’s most famous. It has blossomed in South Korea, Taiwan and the Middle East. So why now is Holder’s branch in China under fire? Accusations against Levillair Group, the franchise owner of Paul Bakery in China, include lack of financial control, un-paid bills and poor human resource management. The aggrieved parties form a long line and involve logistics service provider Clasquin, well-known food importer Sinodis, several franchise investors, plus landlords, construction and design firms, employees, and even Holder Group itself. Francis Mouly, ex-operations director of Paul’s, estimates the total debt at minimum is around 1.2 million Euros. According to sources, Holder Group has been quietly trying to regain control of the situation at Paul Bakery since 2009, but as of yet have been unable to reign in their renegade bakery branch in Shanghai. The Ones Who’ve Lost The amount of debt Levillair Group allegedly incurred is staggering. One insider estimates that at one point, the company had an outstanding debt to Clasquin of over RMB 1 million for imported ingredients. “Essentially Clasquin would pay up front for the raw materials we needed from France,” said the anonymous sources. “But we stopped paying them on arrival and were using services on extended credit … each shipment was around one full shipping container and worth about RMB 300,000.” When the economic crisis hit around 2009,
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Clasquin was finally ordered to cancel the group’s credit line and the last shipment of baking goods (dough for croissants, whole cakes, etc) was abandoned, with an unpaid customs fee, for more than two months in the shipping yard. The entire shipment was ruined and had to be destroyed. Clasquin, which has a relationship with Holder Group in France, may have received some compensation, but sources say it is unlikely that the debt has been completely cleared. Clasquin declined to comment on any of the charges. As a result, the Paul’s Bakery chain here has turned to local suppliers for ingredients, said the source. Paying rent has also apparently been a problem, and Paul’s stores and factory have been plagued by unannounced shutdowns. Former employees say that it was the landlords who shut the door. The Paul shop in the Portman Ritz-Carlton had its doors closed briefly in May 2010, with no announcement; deliverymen arrived to find locked doors. The shop on DongPing Road, in the heart of the French Concession has allegedly not been paying its rent on a regular basis. The factory responsible for providing all bakery items for the Paul’s franchise had its electricity shut off. One of Paul’s most profitable shops, the Gubei Carrefour branch, was shut down for almost a month. At one point, Paul’s owed nine months of back rent to Carrefour, though Mouly says it has been at least 70% paid back. Several former-employees, both from the back office and on the shop floors, have noted that most of the restaurants also lack the correct licenses. Some are licensed under the landlord; others allegedly have no license to speak of. In 2008, the Paul on Huaihai Road was
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FEATURE Retail
shut down permanently due to license issues, after frequent unannounced closings. Individual Players However, the biggest losers in this swath of destruction are arguably the many smaller players, partners and independent investors. Mouly, who was one of the groups’ first China partners, quit in February of 2009. He says he was promised a 3% stake in the company in exchange for his investment of Euro 50,000 and his role as one of the founding partners. It never came. Mouly also says that other investors suffered even greater losses, including the original Arab investors who own the Paul’s franchise in Qatar and Dubai. These investors originally agreed on a 35% stake in the China franchise in exchange for a 6 million euro investment. Mouly says the Arabs never saw a dime in return. The four Arab investors confirmed that they did indeed invest in the China franchise, but declined to comment on this story. The group is also facing lawsuits from the very people who originally defended them. The lawyer, who asked not to be named due to an ongoing lawsuit, represented the group during their first few years in Shanghai. He is now suing Levillair Group for unpaid legal fees, asking for a 200,000 Euro settlement. This lawyer is also filing an official complaint with the French Law Bar Association. If the complaint is filed, then no lawyer in France aware of the case will represent the CEO, Harold Levillair, in court. Employees have been suffering also. According to another insider, paychecks have been paid progressively later since February 2010, sometimes nearly a month after they were due. Health insurance was cancelled in 2009. How it Began Paul Bakery in China was not always so riddled with controversy. Mr. Levillair became involved with Holder Group after his father, who owns a small boutique hotel in Morocco, introduced his son to the patriarch of Holder Group in 2004. After a visit to Shanghai with Levillair, Holder became impressed by the city’s vast potential and a fran-
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chise agreement was approved. Paul’s was on its way to China. The group entered Shanghai with a splash in 2007, expanding rapidly and garnering much excitement among both the Chinese and expatriate population. People marveled at its’ rapid expansion and excellent public image. Residents salivated over the goods. According to two sources, the seven stores were profitable until around 2009, as baked goods – especially French pastries backed by Paul’s international reputation – are very
popular. The shops, despite their relatively high-end prices, were full to the brim and often selling out of stock. However allegations of irresponsible spending soon started the string of unpaid bills plus a downgrade in quality. Despite this, Levillair Group managed to raise four to five million euros to open up Pavilion Coste in 2009. This gourmet restaurant and lounge was located in Shanghai’s ritzy XinTianDi, where rents run around RMB 500-600,000/month. Sources say that the group used Paul as a guarantee when raising funds. Sources also allege that Levillair Group siphoned a portion of the funds intended for Pavilion Coste back into the debt-riddled Paul. However, plenty of money was still spent on Pavilion Coste; the grand opening revealed four RMB 50,000 video projectors, expensive sound engineers from the UK and a renovation by upscale interior designer Red Door. The restaurant closed its doors eight months later with an-
other grand party. Reputation Given the situation, why it has taken Holder Group so long to wake up? While under the franchise agreement Holder Group is only entitled to 5% of the franchise’s revenue, they are arguably risking the ruination of their brand in one of the worlds’ most promising markets. However, Mouly still sees Holder Group as a victim. “Holder tried to do their job monitoring the bakeries,” he said. “But the group was able to avoid them or keep them off; nothing could be done.” A trusted source confirmed that Holder Group has indeed tried to take back the franchise in China to protect its’ interests and reputation, but at the end failed to reach an agreement due to the unreasonable stance of Harold Levillair. As a result, Holder Group now has a pending suit against Levillair Group. Harold Levillair himself was emailed a request to comment on the multiple accusations against his company. He confirmed receipt of the email, but has not responded. The irony of this story is that, in a country where many foreigners tell horror stories about being cheated by local Chinese businessmen, Holder Group appears to have been taken by a compatriot. They can comfort themselves that if they were the first, they are unlikely to be the last. Levillair Group continues to raise funds and open new establishments. According to local lifestyle magazines, the space once inhabited by Pavilion Coste in XinTianDi is currently under renovation, and will open as a Buddha Bar later this year. While the terms of the contract are not disclosed, the lifestyle website SmartShanghai says management will still be under the Levillair Group. “How can I explain this? [Mr Levillair] has the power to make people dream,” said Mouly. “I dreamed for two years with the group, but when I woke up, it was a very hard time indeed. Everyone will wake up sooner or later.”
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FEATURE Retail
酸面团 创建于1889 年的Holder Group 在法国拥有7个知名品牌,其 中最著名的就是Paul's Bakery Paul's 在法国拥有750 家门店,在全 球其他地区拥有100家分店,在韩国, 台湾,中东地区的他们的生 意也日渐红火. 但为何Holder在中国的分支受到了质疑? 作为Paul’s Bakery 在中国的专营权所有者，人们对Levillair Group 的责骂声不断:混乱的财物管理, 拖欠的债务，糟糕的人 事管理。深受其苦的当事人排起了长队，位列其中的有Clasquin 物流公司，知名食品进口商 Sinodis ，数家专营店投资者，房 东，建筑公司，设计公司，员工，甚至连Holder Group 本身也 有份．Paul’s Bakery 的前任营运总监Francis Mouly 估计Levillair 所欠债务最低在1200 万欧元左右。据相关报道，Holder Group 从2009 年也试图夺回Paul's Bakery 的控制权，但对上海的分营店 却只能是覆水难收。 亏本经营 据说Levillair集团的债务着实令人惊愕。据知情着透 露， Levillair 欠下 Clasquin100 万元人民币的进口原料费。在 Paul’s工作的后勤工作人员说：“ Clasquin 先帮我们垫付从 法国进口的原料费，但是我们货到后我们却没有付款并开始赊 帐．．．每批货物差不多能装满一整个集装箱，价值30 万元人民 币。” 当2009 金融危机开始席卷全球，Clasquin被通知取消贷 款享有权并下达命令扣押最后一批烘赔原料（如羊角面包和蛋糕 的发面团）。整批货物被扔在堆场两个多月，而货物的海关费也 迟迟未付。整批货物最后变质，只得被销毁。Clasquin和法国的 Holder Group一向有良好关系，可能得到了一些补偿，但肯定无 法拿到所有欠款。由于事件尚未完全解决，Clasquin不愿对此多 加评论。而据可靠消息称，Paul’s Bakery开始选择当地的原料 供应商。 支付租金也成了问题。Paul's的门店和工厂也悄无声息的 陆续关门歇业。Paul’s的前任员工说不许门店开门营业的是房 东。Paul’s在波特曼酒店的门店于今年5月停止营业。由于事先 没有任何通知，投递员 只能吃闭门 羹了。东平 路上的 门
店处于旧时法 租界的中心 地段，他们 仍是按常付租 金。专门负责 Paul’s门店的 n Monica Liau 面包生产工厂停 电了。Paul’s的 古北家乐福门店，可 谓是家乐福最赚钱的一家了，但一个月前，他们也歇业关门了。 有一点是明确的，Paul’s欠家乐福9个月的租金，而Mouly说70% 的欠款已经偿还。 一些以前在门店里操作和后方办公室里工作的员工称有些 Paul’s的门店甚至连营业执照都没有，有的是在房东名下做的 执照，有的索性完全不过问这档子事儿。在2008年，Paul’s在 淮海路上的门店就是因为执照的缘故而关门大吉的。
债务官司缠身的 PAUL’S
个人损失 然后，这一摊浑水中最失利的要属小公司，合伙人和独立投 资人。作为Levillair 集团的第一批中国合伙人，Mouly在2009年 2月份退出了合伙。Mouly说他投资5万欧元本应购买了公司3%的 股份，他的职位应该是创业合伙人。但这些股份和头衔并没有兑 现。Mouly 还说别的投资者损失更为惨重。他们有些是Paul’s 在卡塔尔和迪拜的阿拉伯投资商。他们原来答应投资600万欧元 兑换35%的股份。这些阿拉伯商人再也没看到他们的银子流回来 过。这四位阿拉伯投资人确认他们在中国门店的投资行为，却拒 绝对此事做进一步评论。 集团现也面临起诉，而起诉他们的人正是原来为他们辩护 的一方。这位不愿透露姓名的律师在集团进驻上海的头几年为 集团担任法务代表。但现在他因Levillair拖欠他的律师费而将 后者告上法庭。该律师同时也向发过律师协会提出投诉，一旦 投诉生效，在法国没有律师被允许代表集团首席执行官Harold Levillair出席法庭判决。 集团的员工也挣扎于水生火热之中。另一位知情人士表示， 今年2月后，他们断断续续收到了工资，有时候会隔一个月才收 到上个月的工资。2009年时他们的医疗保险就被告知停止了。 源头
Paul’s
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Bakery
在中国碰到的并不都是矛盾。2004 年，
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FEATURE Retail Levillair 先生因为其开一家摩洛哥小旅馆的父 亲而结识了Holder 集团的掌舵人。Holder 在 与 Levillair 同行参观上海之后，十分看好上 海的发展前景并答应开直营店。Paul’s 在中 国的第一家直营店便由此诞生了。 Levillair集团2007年华丽进驻上海。那 一年，他们大量扩张业务，在中国和外国消费 者中引起了一阵追捧热潮。人们都十分惊叹 Paul’s的扩张速度，也十分赞赏它的品牌形 象。面包飘香又常常让人垂涎三尺。据称， 直到2009年，这7家门店仍然处于盈利状态， 因为Paul’s是拥有著名国际品牌支撑的面包 房，人们颇爱面包。尽管开价颇高，但是面包 房仍然很受欢迎，常常供不应求。然而，好景 不长，滥用资金很快就引来了债务，人们也指 责面包的质量有所下降。 尽管如此，Levillair集团在2009年仍筹 资400-500万欧元建造Pavilion Coste。这家餐 厅座落于上海新天地，租金大约为5-6万元人 民币每月。消息称，集团在筹资时用Paul’s 做担保。同时，Levillair集团挪用了小部分Pavilion Coste的 启动资金来填补Paul’s的债务漏洞。大部分资金还是花在了餐 厅上。餐厅开张仪式当天，主办方启用了四台价值5万元的投影 仪，还聘用高端室内设计公司红门做内部设计。饭店开张刚8个 月就关门大吉了。
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名声 看到如此情况，Holder集团为何方才清醒？虽 说Holder集团只收取直营店收益额的5%，他们放任 不管只会在中国这个如此有前景的市场上毁坏自己 的名声。然而，Mouly仍认为Holder集团也是受害 者。他说：“Holder想操控Paul’s,但Levillair 却百般阻挠，使得前者无计可施。”虽说已有律 师事务所介入代表Holder与Levillair谈判，但 至今我们仍不知晓事情会不会有解决的可能性。 由于事情仍在处理过程中，双方都不愿做更多评 价。Harold Levillair被邮件通知必须对其公司 的职责作出回应，虽声称收到邮件，却迟迟未作出 应答。 这一事件的可笑之处在于，在中国，当许多 外国人抱怨说被中国商人欺骗时，Holder集团似乎 成了自己人的枪靶子。他们当然大可安慰自己说虽 说这样的事情这次发生在了自己身上，但同样的事 情一定会再次发生。Levillair集团仍在筹集资金 开设新的店面。据一家本土生活杂志称，Pavilion Coste现在正在装修，年内将开出一个布达酒吧。 虽然合同的条款并未公开，但生活时尚网站SmartShanghai称酒 吧的经营权仍由Levillair集团掌控。Mouly说：“这一切又从何 解释呢？Levillair就是有本事让人们幻想。我在这个集团做了 两年的美梦，但当我清醒后，一切变得太过可怕。早晚会有那么 一天，所有人都会清醒的。”
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S
FEATURE Supply Chain
uicides. Spreading strikes. Militaristically zealous management and aggressive security guards. Pay raises and suicide contracts. These recent dramatic headlines have shoved Foxconn, the trade name of Taiwan-based Hon Hai, from relative anonymity straight into the unwelcome limelight, dragging its big-name customers like Apple, Dell and Sony along behind it. But while the glare of publicity may be bright, it has blinded many to the real story, which is about much more than suicides at a single electronics company in Southern China. While the shrill voices of daily news have been pointing fingers at individual players, the issues, real and illusory, at Foxconn are symptomatic of the dynamic, pressured relationships between all the usually anonymous EMS providers and their brand-name customers, their employees, governments and society at large.
Thin Ice
Examining the facts behind Foxconn, Apple and the “crisis” facing the EMS market. Myth: Foxconn is the Bad Guy Before looking at the wider issues, we should consider what is actually happening at Foxconn, and clear up a wide array of misunderstandings intensified by headline hype. Foxconn is the largest electronic manufacturing services (EMS) provider in the world, more than twice the size of its’ next-largest
competitor Quanta, and with more than 300,000 employees at their Longhua and Shenzhen campuses alone. It is also notorious for an aggressive management style. “They come in like an occupation army,” said one former Foxconn manager. “That approach served them well in the past, but I think they’ll have to change now.”
But whether management changes or not, Foxconn is hardly the only EMS firm that manages “aggressively,” and while many have criticized Foxconn’s on-site factory work environment, Foxconn actually offers working conditions similar to those at the other leading EMS players, and substantially better than those at many of their suppliers.
The League Table of Leading EMS Players (Table 1) Approx. 2009 revenue(US$1 billion)
Origin (HQ)
Recent gross margins
Foxconn (Hon Hai)
$62
Taiwan (Taipei)
8.7% - 9.8%
Quanta
$24
Taiwan (Taipei)
unknown
Flextronics
$21
USA (now Singapore)
4.1% - 4.9%
Wistron
$16
Taiwan (Taipei)
4.5% - 6.0%
Compal
$13
Taiwan (Taipei)
6.2% - 6.8%
Inventec
12$
Taiwan (Taipei)
3.5% - 3.6%
- Sources: Company financial reports, China Supply Chain Council research.
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FEATURE Supply Chain
One insider noted that while the company is aggressive in their business approach, they also provide their workers with swimming pools, exercise rooms and on-site counseling centers for staff. One supplier to Apple said that, in their experience, Foxconn is far from a sweatshop, and actually provides a better environment than many Chinese companies. For example Wintek, one of Foxconn’s suppliers, was accused earlier this year of not protecting its workers against the toxic chemical n-hexane, which is used to clean Apple components. Many employees subsequently exhibited extensive damage to their peripheral nervous system and spinal cord, causing to muscular weakness, atrophy and in some cases, paralysis. Another misleading assertion is the link between the suicides and overtime. “In my three years of interviewing migrant workers . . . I found that the greatest pressure comes more from interpersonal and emotional concerns than factory conditions,” said Leslie T. Chang, author of Factory Girls: From Village to City in a Changing China, in a recent report for research house CLSA. “Laboring long hours is the reason they come to the city in the first place.” According to other sources, most factory workers actually expect the ability to apply for overtime work, as this is how they make extra money on top of their base monthly salary – which averages around RMB900. Factories that do not offer overtime have a hard time filling spaces on their factory floor. While some argue that the only reason workers want overtime is because they are underpaid, the counterargument is that many of the migrant workers have one goal: to save as much as humanly possible in as short a period of time, and send it home.
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Behind the Suicides However, the 10 disturbing suicides plus three attempts that have been reported do not express a sense of worker satisfaction, and to outsiders the tragedies suggest an even darker corner in Foxconn’s closet. The first suicide reported was a result of one worker being accused of stealing an iPod and then being interrogated in a small room for hours. The interrogation, and the worker’s ensuing deadly leap from the roof, enraged the public. Unfortunately, the same Spartan management style that brought Foxconn to dominance was ill suited to coping with ensuing employee dissatisfaction and media coverage. Eventually compensation was granted to the worker’s family. The suicides kept coming, but seemingly spawned by dissatisfaction in the given worker’s personal life—although one worker referred to the prospect of generous compensation from Foxconn in his final letter. In any population of 300,000 young people in urban China, one should statistically expect at least as many suicides per year as seen at Foxconn recently. Factory workers are overwhelmingly younger than 25, and the suicide rate among Chinese youth (similar to youth everywhere) is higher than the overall average. Many U.S. universities would be ecstatic if their suicide rates fell to levels as low as those at Foxconn China. Even a concentration of suicides at a single manufacturer may not be the manufacturer’s fault. Aggressive media coverage tends to exacerbate the globally well-documented “Werther effect” of suicide clusters. “Reports from other countries have identified suicide clusters in schools, military units and other closed communities similar to the ’company town’ environment at Foxconn,”
EMS Branding Risk?
I
n some peoples mind, these brand names have outsourced too many secrets, and face having their name brand technology used for by and EMS trying to break into the retail market. Early in the last decade, Flextronics famously decided against developing an own-branded product in the mobile device sector, believing that they’d risk too much by going into competition with their competitors. “Foxconn will never do what HTC and such have done,” said one ex-Foxconn employee. “To launch their own brand doesn’t make sense.” An ex-Apple manager echoes that Foxconn will not betray its customers and in fact is in line with Apple’s business strategy. “I believe Foxconn is the right partner for Apple,” said the manager. “They have the same concept for supply chain management. Apple wants to move to online business, while Foxconn wants to continue their vertical integration.” The bottom line is that branded products produce more margin than unbranded ones; services and solutions produce more margin than hardware. The zeal for margin will keep brands and their EMS suppliers on the battlefield, though sometimes fighting in league with one another.
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FEATURE Supply Chain said Michael Phillips, director of the Shanghai Suicide Research and Prevention Center at the Shanghai Mental Health Center, in a recent opinion piece for the Asian Wall Street Journal. “This is most common in adolescents and young adults [all the recent suicides have been in their teens or early 20s] and there is always a contagion element to clusters because the individuals know each other or have been exposed to prior suicides by personal communication, the media or the Internet.” Myth: The Apple’s Gone Bad While Foxconn has already caught its share of the heat, some reporters are already looking up the value chain at Foxconn’s corporate customers. This involves Apple in particular, as the company has also been getting a lot of flack in this media blitz for lying down on CSR and for the fact that it seems to have little knowledge about the actions of its suppliers. In February 2010, a CSR investigation (initiated by Apple) discovered child labor in its suppliers’ factories. While by the time the workers were discovered, they were legally of working age the revelation, in combination with the Foxconn scandal, has rattled Apple’s image with Western consumers and made some observers wonder whether it is losing control of its supply chain. That’s extremely unlikely. Rather, the media feeding frenzy grows because Apple, like Foxconn, represents an easy target. In Apple’s case, it’s in part the extreme of secrecy and detail orientation in product development, though the resulting product design has created millions of devoted Apple fans the world over. A supply chain manager at a competitor in the mobile device sector says that they do think Apple is on the extreme side when it comes to their outsourcing strategy. But the difference is of degree, not of kind. “Apple is well aware of Foxconn’s practices and is attentive to the world at large,” says one former Apple supply chain manager. “Apple pushes Foxconn to improve the working environment.” In 2007, three academics writing for the Personal Computing Industry Center took apart an iPod to gain a clearer understanding of Apple’s sourcing and supply chain, and to un-
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EMS VS. OEM
The term original equipment manufacturer (OEM) is confusing; it is widely used within the EMS companies to refer to the brands (Sony, Nokia, Dell, Apple, etc.) that are their customers; it is widely used elsewhere to refer to the EMS companies themselves. In this report, we use ‘EMS’ to refer to companies like Foxconn, and ‘consumer brands’ or ‘brands’ to refer to the Sonys, Apples and other such. These EMS companies, rather than the brands who are their customers, manufacture all those electronic gadgets we have on our desks, in our briefcases and our pockets. This industry is young, having gained a kick-sin the 1990s. The Worldwide Electronics Manufacturing Services Market report of 2009 estimated total 2008 EMS market size at US$294 billion. The China Supply Chain Council’s research indicates that the top ten players in the sector hold slightly more than half of the market (see table 1, pg26). Because manufacturers view with envy the higher margins enjoyed by the brands, a number of companies that stared out as mere contract manufacturers have evolved into EMS players, providing a wider range of solutions to customers.
Leading Brands (Table 2) Approx. 2009 revenue (US$1 billion)
Origin (HQ)
Recent gross margins
Apple
$37
USA (Cupertino)
34% - 36%
Nokia
$59
Finland (Espoo)
32% - 34%
Dell
$61
USA (Round Rock)
17% - 19%
Sony
$67
Japan (Tokyo)
19% - 22%
- Sources: Company financial reports, China Supply Chain Council research. derstand which parts of the value chain were delivering the most profit. In Who Captures Value in a Global Innovation System? The case of Apple’s iPod, the authors revealed that the iPod, like virtually every other consumer electronics product available today, is a combination of many companies’ efforts. Toshiba makes the hard drive (themselves outsourcing some components), the most
expensive component in the iPod. Broadcomm, Inventec and Samsumg all contribute components as well. Foxconn manages the overall upstream supply chain, assembles and delivers to distribution points, and then supports after-sale service. Nothing in this model suggests anything extraordinary, though the report does note that “Apple is particularly sensitive about its supply base.”
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FEATURE Supply Chain
THE CONSUMER BRANDS
Developing a valuable consumer brand requires years or decades of endeavor, an intimate knowledge of end users and a solid grasp of strategic marketing, a skill-set dramatically different from that required of EMS providers. All these brands manage their supply chains in part by outsourcing to EMS companies so they can focus their resources on their core competitive advantage and the parts of the value chain where margins are the highest. Even after outsourcing manufacturing, brands recognize that some aspects of their remaining operations are more profitable than others. IBM famously left the PC market entirely (they’d long since outsourced the manufacturing component) with the sale to Lenovo six years ago. Sony’s 2009 annual report indicates their goal of similarly moving from hardware to software and solutions. Dell’s financials indicate that their product segments deliver gross margin of 14%, while their services segments delivers more than 33% gross margin. No wonder then that Dell has launched Dell Financial Services. For Apple, iTunes is the relevant story.
Operating Margins of 120 Taiwanese Technology-sector Vendors Excluding Semis Including Semis 9% 8% 7% 6% 5% 4% 3% 2% 1% 0%
2004
2006
2008
- Source: Controlled Contagion, CLSA Asia-Pacific Markets, 3 June 2010
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A Problem of Cost Looking beyond Apple and Foxconn, what substantial supply chain issues really lurk behind the stories? Rather than media hype and speculation, supply chain managers should be paying attention to how the manufacturing environment in China is changing. A primary issue is increasing labor costs. Manufacturing job growth in China has accelerated rapidly again this year, and seems to have recovered almost entirely from the 2008/2009 downturn. Rising demand for manufacturing labor, rising minimum wages and an increased sense of worth on the part of potential laborers have all put strong upward pressure on labor costs. In late May, headlines covering a strike at a Honda-owned parts factory in Foshan (near Shenzhen) began to appear alongside the Foxconn stories. The Honda employees won about a 25% wage increase. At the same time, workers struck at a Japaneseowned manufacturing facility in Xi’an and at a Taiwanese-owned facility near Shanghai. Nearly concurrently, Foxconn announced a pay raise of over 30-50% for its Shenzhen plant, bringing the base salary of its workers from RMB900 to RMB1200-2000. Numerous provincial governments subsequently announced they would raise local minimum wage levels. For companies operating in China, labor costs are going up. Business as Usual The EMS companies survive on relatively small margins. Can they survive in a more expensive environment? One supply chain manager at a leading EMS player says that the strikes at Honda and in Xi’an are more worrisome than the over-reported situation at Foxconn. The macro factors driving increased negotiating power on the part of employees will continue to nudge labor costs up for manufacturers. However, since labor costs are not yet a major component of overall costs, manufacturers have some room to manage labor cost increases. Manufacturing wages have also been climbing roughly in line with GDP in China for at least a decade, yet manufacturers have survived. “A sample of 120 Taiwan tech vendors shows remarkably steady margins, on an aggregate, through many years of wage hikes,” says Bhavtosh Vajpayee, head of technology research for CLSA. “Despite a
decade of wage inflation, China or India will remain preferred outsourcing destinations for hardware and services.” Demand volatility and non-labor input costs have a much stronger influence on margins. Arthur Kroeber, head of the research house Dragonomics, also says that since workers in China aren’t permitted to independently organize and there are still so many of them, China won’t see a paradigm shift soon. “China’s massive underclass of workers is often seen as a source of social unrest, but in reality [these workers] are a force for stability,” says Chang in her CLSA report. “Repeated predictions of rising unrest—during an Asia-wide recession in the late 1990s and again in the recent global economic downturn—have not come to pass.” Customer Distancing The other issue is the demand side. Will the recent media frenzy negatively impact Foxconn’s relationship with its customers, namely Apple, and shift the power relationship between the brands and their suppliers? As mud drips off of Foxconn onto Apple and Dell, will the brands try to distance themselves? As a rule, during initial stages of discussions between brands and EMS players, the negotiation advantage tilts towards brands, due in part to overcapacity in the EMS space and the lower barrier to entry. A sales representative for one of the leading EMS says that he as seen a lot of desperation among the EMS players recently. “Last year, we were at the final stage of negotiation for a big project, and we’d already accepted terms that would have cut our margin to 1%,” he said. “Then the brand rep said we would be required to pay a multi-million contract signing fee.” The sales representative’s company walked away from the deal, but their competitor took it anyway. “They are losing money,” he continued. “How long can this go on?” Forward looking prospects However, no substantial change is likely in the short term. Once a relationship is established between an EMS supplier and a brand, savvy EMS players are able to make the relationship sticky—meaning the cost of shifting suppliers becomes intolerably high
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FEATURE Supply Chain – so that the EMS player’s negotiating power increases. “[Our major customer] may press us for a few more pennies off the price,” said one EMS development manager. “But we counter by saying we’ll grant the discount if they give us a larger piece of the service contract.” Foxconn is exceptionally good at being sticky—few of the insiders we spoke to felt that Foxconn is at any risk of losing substantial business as a result of the recent media attention, because their high-profile and highly demanding brand customers have come to rely so deeply on Foxconn’s partnership—going far beyond product production and covering virtually all of the value chain: from cooperation in R&D to retail distribution and after-market services. At the same time, the increase in labor costs is also manageable. Historically, Taiwanese tech-sector companies have been able to maintain their margins over time because they are constantly on top of their pricing. While the Shenzhen site will be more expensive to operate, Foxconn, along with competitors Quanta and Wistron, are
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already developing other manufacturing sites in western China. Foxconn will likely downsize dramatically in Shenzhen and Longhua, moving the mass production work farther north and west, while the more detailed finishing and export work will stay on the coast. Not only are labor costs less out west, but land prices are also cheaper, as local governments are very keen to give large employers a break to attract them to their town. While reaching global markets from Chongqing and other inland locations may be marginally more expensive, the move to the inland provinces also puts EMS providers closer to some of China’s large and fastgrowing domestic markets. Foxconn and their figurehead Guo have also proven their ability to evolve fast. In late May, the company took the unprecedented step of inviting six buses full of journalists for a tour of their Longhua facility. For a company that is famously secretive and protective of their customers’ products, the media bus tour reflects on the likely speed with
which they’re going to transform what they’re doing in Longhua. While discussion, concessions and media hype may continue for some time, the relationships between the brands and the EMS will not likely stray greatly from their current course. The recent incidents at Foxconn and Honda, and countless others that are happening around the country, though less reported, are merely smaller symptoms of an epoch-level transition in the global economy and supply chains. The major forces affecting the China supply chain will remain as they’ve been for some time: steadily rising wages and more demanding employees here; contract manufactures moving up the value chain, and brands eager to hand over more of it to the manufacturers, worldwide; and consolidation of the manufacturers, because of the paramount importance of economies of scale. Supply chain leaders will do well to remain focused on the global tides affecting supply chain management, and to ignore the regularly appearing froth on the waves.
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FEATURE Supply Chain
自
杀。罢工潮。狂热的 军事化管理，严苛的 安保。加薪，不自杀 协议。最近，这类引 人注目的大字标题层 出不穷，把富士康这家台湾鸿海集团的 子公司从相对默默无闻的幕后径直推到 不受欢迎的聚光灯下。而其大牌客户如 苹果公司，戴尔公司和索尼公司也由此 难逃牵连，被迫与富士康共同曝光。不 过，充分曝光或许十分炫目，但强烈的 光芒也同时让众人无视真实的情况。这 些情况远不止是一家电子产品代工公司 的系列自杀事件那么简单。尽管各大媒 体对个别厂商还在高声挞伐，但是，富 士康事件真切却又虚幻地反映了中国众 多隐身幕后的EMS公司近来与他们的知名 客户，他们的员工，政府和社会的密不 可分却又压力频增的关系。
中国供应链行业中的
自杀与罢工事件
一条大鱼 不过，在进一步探讨各种问题之前， 弄清富士康事件的真相，同时澄清狂热的 媒体推波助澜予以强化的普遍误解，还是 值得的。富士康是全球最大的电子产品代 工服务（EMS）供应商，其规模是紧随其 后的竞争对手广达电脑的两倍。前者仅在 深圳龙华的分区就有30万员工。不仅规模 惊人，富士康还素以其严苛的管理风格 而颇受非议。一位富士康前任经理说：“ 他们是像占领军一样来到大陆设厂的。过 去，那种军纪严明的做法很管用，但现在 我想他们非改不可了。” 不过，不管管理风格是否会改，在 EMS公司中，富士康这种严苛风格绝不是 独此一家。尽管很多人纷纷指责富士康 工厂工作环境不如人意，实际上，富士康 所提供的工作条件与其他行业领先EMS厂 商相去无几，并且与众多供应商相比，这 种条件已算差强人意了。一位业内人士指 出，虽然富士康在生意上咄咄逼人，但公 司还是为工人们提供了诸如游泳池、健身 房和现场心理咨询中心等服务设施。一家 苹果公司的供应商表示，据他们所知，富 士康远谈不上是血汗工厂，与中国众多同 类公司相比，富士康的工作环境实际上已 算更胜一筹。比如，今年早些时候，富士 康的供应商之一胜华科技就遭到指责。该 公司工人用有毒化学制品正己烷清洗苹果 公司产品配件，公司却没有为其提供相应 保护。这些工人中不少人随后被发现周 围神经系统与脊髓严重受损，导致肌肉乏
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n John D. Van Fleet 力、萎缩，有些人直至瘫痪。 另一个产生误导的判断是认定自杀 与过度加班密切相关。而《工厂女工》 （Factory Girls）的作者Leslie Chang 在其近期为里昂证券（CLSA??）所做的一 份报告中称：“在我探访民工的三年中， 我发现，民工们最大的压力往往来自于人 际沟通和情感问题，而不是工厂的工作条 件。” 而在另一位业内人士看来，“能加班 工作是民工们一开始打算进城务工的原因 之一”。工人的平均工资在900元左右， 很多工人实际上盼着能有机会加班，因为 这是他们每月能够多挣一点的机会。无法 提供加班机会的工厂则普遍面临招工不足 的困难。有些人认为，工人们之所以加班 的唯一原因，是因为报酬太低，但对此形 成反驳的事实是，许多民工都抱着一个目 标：在短期内，力所能及地尽量多存下钱 来，寄回家里去。
自杀背后的真相 不过，一连发生了十起自杀，加上三 起自杀未遂，显然工人们过得并不如意。 而对外界来说，这些悲剧事件则揭示了富 士康内部黑暗的内幕。第一起自杀的起因 是，那位工人被控偷了一台iPod后，被关 进小屋接受了长达数小时的盘问。盘问事
件加之随后从屋顶一跃而下自杀身亡的举 动，终于触犯了众怒。 不幸的是，富士康可以凭借军事化管 理作风称霸世界，但在应付接踵而至的员 工怨言和媒体报道时，这种作风就显得力 不从心了。最终，公司对死者家属做出了 赔偿。最终，自杀的员工的家庭得到了赔 偿，但自杀事件接踵而至，层出不穷，虽 说一个工人在遗书中称动机倾向于富士康 提供的大笔赔偿金，但工人们自杀额原因 似乎还是源于对工作生活的不满。 对死因的讨论似乎大多集中在死者个 人生活的失意上。不过值得注意的是，一 位自杀者在其最后一封信中，提到了富士 康会为身故者提供的大笔赔偿金。从统计 上看，中国城市中任何一个为数30万人的 年轻人群体中，每年都会发生至少与富士 康近期自杀事件数量相当的自杀。不过， 工人们都十分年轻，大都不超过25岁，而 中国年轻人（他们与世界各国青年无异） 的自杀率比人群总体平均自杀率要高得 多。而对于很多美国大学来说，如果他们 的自杀率跌至与富士康相当的水平的话， 那就值得额手称庆了。 就算所有这些自杀案都是在一个制 造商名下发生的，这也不能说就是那个 制造商犯了错。媒体对自杀事件的广泛 报道会加大世界范围内广受印证的连续自
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杀（suicide clusters，或者说“自杀 丛”）的“维特效应”。迈克尔•菲利普 （Michael Phillips）是上海精神卫生中 心（Shanghai Mental Health Center） 上海自杀研究与预防中心的主任。在他近 期为《亚洲华尔街日报》（Asian Wall Street Journal）所撰短评中，他的观点 是：“世界各国都有研究报告证实，自杀 丛往往出现在与富士康企业生活区这样的 环境类似的环境中，如学校、军队和其他 人口密集的社区。往往是在青少年和青年 中，这种情况最为多发（近期富士康的自 杀者都只有十几岁或二十出头），而自杀 者前后相继，往往彼此间还存在着一种传 染效应，因为自杀的个体之间要么相识， 要么通过人际传播、媒体或互联网知道了 刚发生的自杀。” 不过，富士康及其老板郭台铭也向 来以快速应变而著称。五月下旬，富士康 破天荒地邀请了满满六辆大巴的各路记者 造访其位于龙华镇的工厂。该公司一直号 称高度机密，对客户的产品严加保护，因 此此举显得颇耐玩味，并且，在某种程度 上，这也表明公司可能将迅速采取举措， 对其在龙华的做法作出改进。
无良苹果公司？ 就在富士康深陷各方热议时，有些 记者已经开始审视富士康公司客户的价值 链了。苹果公司首当其冲。就在这轮媒体 大讨伐中，苹果公司因其置企业社会责任 （CSR）于不顾而饱受争议，而其对自己 供应商的所作所为似乎知之甚少，也成为 批评的目标。对苹果公司在今年2月展开 的CSR调查表明，其供应商工厂里存在童 工现象。由于这一情况，加之富士康公司 自杀丑闻，苹果公司在西方消费者心目中 的形象已受到动摇，同时，也令一些投资 者提出质疑，该公司是否已对自己的供应 链失去掌控？ 与富士康一样，苹果公与富士康一 样，苹果公司也是一个处于极端位置，易 受攻击的对象。之所以这么说苹果公司， 部分原因在于其登峰造极的保密 政策，以及其在产品 研发中极度 苛
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求细节的倾向。不过，由此创造的产品设 计却在世界范围内造就了成千上万铁杆苹 果迷。在移动设备领域，一个苹果公司竞 争对手的供应链经理表示，就生产外包战 略而言，苹果公司确实做得颇为极端。 但与对手相比，这种 差异主要在于程度而 非类型上。苹果公司 一位前任供应链经理 说：“苹果公司对富 士康的做法了如指 掌，同时对外部世界 也高度关注。苹果公 司正敦促富士康改善 其工作环境。”
成本难题 中国的制造业大环境正在发生改变。 首先是不断攀升的劳动力成本。今年以 来，中国制造业岗位再次快速增加，似乎 已从 2008 、 2009 年的开工不振中彻底走 出。制造业劳动力需求猛涨，最低工资提 高，潜在务工者对自身价值的高估，所有 这些合力造成了劳动力成本被迫推高。 五月下旬，报道本田汽车佛山（靠 近深圳）配件工厂罢工的媒体头条开始与 对富士康的报道并肩亮相。本田的雇员最 终赢得了25% 的加薪。与此同时，西安的 日资工厂与上海的台资工厂也纷纷举行罢 工。就在差不多同时期，富士康宣布，其 深圳工厂加薪30%-50% ，将底薪从900 元 提高到 1200 元— 2000 元。随之，数个省 宣布，将提高当地最低工资水平。对中国 本土公司，尤其是外资公司而言，劳动力 成本就此开始上涨。 面对现状，所有人心头都萦绕着一个 疑问：成本不断增长， EMS 公司能挺过 去吗？有关工资增长的新闻已让富士康的 股价出现重挫，投资者们对中国其他外资 公司的盈利状况也开始担忧。 EMS公司的利润不多，他们能否在这 个成本激增的环境中继续竞争下去呢？ 一位 EMS 行业骨干企业的供应链经理表 示，比起富士康受到过度报道的情况来， 本田工厂与西安工厂的罢工其实更令人担 忧。目前，对生产商来说，推动工人们谈 判能力不断增强的各种宏观因素将持续推 高劳动力成本。不过，由于劳动力成本已 不再是总体成本的主要构成要素，生产商 还是有余地掌控劳动力成本上涨的。 近十年来，制造业工资水平一直与 GDP 大致保持着同向增长，不过生产商 们 还 是 过 得 不 错 。 里 昂 证 券 （ CLSA ） 的技术研究部主管Bhavtosh Vajpayee 表 示：“一项对 120 家台资技术供应商的抽
样调查显示，虽然工资水平多年来保持增 长，但这些企业总体上还是一直盈利。尽 管十年来工资一直上涨，对硬件制造和相 关服务来说，中国或印度还会是理想的外 包目的地。”事实上，需求变动和非劳动 力成本对盈利情况才影 响更大。 Dragonomics研 究公司的负责人亚瑟• 克鲁伯（Arthur Kroeber ） 也 表 示 ， 由 于 中 国的工人不得独立形成 组织，并且这类工人仍 然为数众多，因此，中 国要实现生产模式的转 型还为时尚早。 而 Leslie Chang 在其为里昂证券所做的报告中称：“中国 广大的下层劳动力常被视作社会动乱的潜 在因素，而实际上，他们是维系社会稳定 的重要力量。20 世纪90 年代末，亚洲地区 饱受经济衰退冲击，近期，又出现全球经 济下滑，这两个时期都不断有人预言，社 会动乱即将到来，但是，这些话都没有应 验。”
客户端难题 另一大问题在于需求端。近期富士康 在媒体上形象一落千丈也不禁让人产生疑 问，这些事件会对富士康与其客户，比如 苹果公司的关系造成负面影响，并让这些 品牌公司与自己的供应商之间的权属关系 发生变化吗？当富士康身上的负面报道不 断影响到苹果公司和戴尔公司时，完全可 以认为，这些品牌会设法置身事外。 一般而言，在品牌公司和 EMS 公司 开展磋商的初期，谈判的砝码更多地在品 牌公司手上，这部分是由于 EMS 的过剩 产能和该行业不高的准入门槛。一家主要 的 EMS 公司的销售代表表示，最近他看 到很多业内公司已陷入抓狂的境地。他 说：“去年，我们的一个大项目已经到了 谈判的最后阶段，协议条款让我们的利润 率被砍到 1% ，我们也接受了。随后品牌 公司的代表却说，我们必须付几百万的合 同签约费。”这使得该公司放弃了这笔买 卖，但他们的竞争对手随后跟进签了这笔 合同。他说：“他们是赔钱签的，这么做 能长得了吗？”
前景预测 不过这种现状恐怕短期很难改变。 就供应商与品牌公司的关系而言，一 旦合作关系确立，精明的 EMS 厂商就会 设法让这种关系铆牢——这就意味着转换
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FEATURE Supply Chain 供应商的成本会很高，有悖效率优先的原 则——由此EMS 厂商的谈判能力会大幅提 高。一位EMS 公司开发经理说：“大客户 可能会逼着我们再让点价，我们怎么应付 呢？我们会说，如果你们给我们更大的服 务合同，让价没问题。” 富士康就在如何铆牢这种关系上尤其 擅长——我们交流过的公司内部人士中， 几乎没人认为，富士康会因为最近的媒体 曝光而丢掉主要业务，因为公司那些众所 瞩目并要求苛刻的品牌客户已经非常依赖 于富士康的合作关系了——这种合作早已 超出了单纯的产品代工，几乎覆盖了全价 值链：从研发合作到零售分销再到售后服 务。 与此同时，劳动力成本就算上涨，也 还在可控范围内。从历史上看，台资科技 型企业一直都维持着盈利能力，因为他们 始终精熟于如何定价。当深圳的运营成本 增加时，富士康，以及其竞争对手广达电 脑和纬创集团，已经开始在西部地区开发 设厂了。 富士康很可能会大力压缩其深圳和龙 华镇的生产规模，将大量生产的工作迁至 中国北部和西部地区，同时将更精细的总
装和出口工作留在沿海地区。西部地区不 仅劳动力成本低，地价也更便宜，因为当 地政府十分热衷于以各种优惠政策吸引大 投资者赴本地投资。 从重庆及其他内地城市向国际市场 出口可能会增加成本，但是在内地省份扎 根，也使电子产品得以靠近中国增长最快 的国内市场。 尽管各类讨论、折中方案和媒体热议 还会持续一段时间，但总体上看，外包商 与其EMS厂商的关系大部分不太会偏离既 有轨道。就最近这些事件来说，无论是发 生在富士康也好，本田也好，中国其他无 数曝光有限的地方也好，都仅仅是全球经 济和供应链转折期所表现的小症状。影响 中国供应链的主要原因仍然还是那些存在 已久的老问题：工资越涨越高，员工要求 越来越多，承包制造商太高了价值链因此 大牌厂家便迫不及待的把项目批给这些制 造商做，这个情况全球如此，还有出于规 模经济的需要，制造商们纷纷合并扩大。 对供应链的领导者来说，专注于那些对供 应链管理具有影响的世界趋势，就会赢在 长远，同时对于那些潮流所向过程中出现 的短暂事件，大可不必过于在意。
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JULY/AUGUST 2010
33
PRODUCT Study
Shipping It Green
C
argo ships are often considered a “greener” way to get goods around the world as compared to airplanes and trucks because you can ship more at one time and less trips are needed. However, the diesel fuel that these mega-boats run on is notoriously dirty. According to several sources, they produce at least 3-4% of the entire world’s carbon emissions. Not only that, but the price of oil is one of the most volatile and unpredictable parts of transportation. If practical, a ship less dependent on oil could not only be better for the environment, but also for the shipping industry’s bottom line. Here are some of the more interesting things happening in the line of green shipping.
Reduction of CO2 Emissions Total Total Cut Cut ▲ ▲ 69 69 % %
Solar power 2%
Propulsion efficency 5 %
Wind power 4%
Supercondutivity 2%
Weight savings 9%
Hull friction 10 %
Reduced power for ship use 2 %
Fuel cells 32 %
Wind resistance 1%
Hull form optimization 2%
Ship’s Particulars 8,000 TEU / 25 knots Basis
34
Standard NYK Cargo Ship
Super Eco 2030
Length
338m
353m
Width
45.8m
54.6m
Design Draft
13.0m
11.5m
Required Power
Diesel Engine (HFO): 64MW
Fuel Cell (LNG): 40MW
Renewable Energy
None
Solar : 1-2MW Wind : 1-3MW
CO2 Emission
195g/TEU-mile
62g/TEU-mile
JULY/AUGUST 2010
NYK
The model of one of the most sci-fi looking vessels currently under research and development was unveiled by Nippon Yusen Kaisha (NYK) in 2008, with the promise to create a freight ship that runs on nearly no fossil fuel by the year 2030 and absolutely no fossil fuel by 2050. The R&D branch of this Japan based shipping company is banking on being able to develop the correct technology – like more powerful solar panels, hydrogen fuel and efficient wind energy -- by the time their deadline rolls around. To work on this ship, they are focusing on three concepts. The first is reduction, which refers to reducing unnecessary weight, motor inefficiencies and frictional resistance from both sea and air. The second is using new technology for power generation, such as fuel cells and alternative fuels like hydrogen and liquid and liquefied natural gas. Lastly, NYK will work on developing new types of power sources from solar and wind. A fascinating concept, but it seems we still have twenty years to wait.
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PRODUCT Study
No rigging to foul spars, so better upwind sailing angle
Skysall
60% Thrust from wind
Automated operation lowers crew costs and increases H&S
Rotating Masts
Nor rigging to foul cargo bandling
40% Thrust from engine
B9
B9, a company based in Northern Ireland, has been working on low carbon vessels since 1983, when the company’s founder built the worlds’ first sail-assisted cargo ship. Now, they have bigger plans. According to a study by B9, there are 10,000 oil powered ships currently operating around the world that are of a similar size to the futuresque B9 Ship. Each of the dirty oil-powered ships emit some 16 tons of CO2 each day. B9 claims that it can replace all the conventional ships with reliable, clean vessels that offer predictable, affordable freight rates; a switch, they say, that will reduce CO2 emissions by 52,000,000 tons. In 2011 work will begin on building the hull for the 100m long, 3000dwt coaster. The 50m masts will be constructed at Harland and Wolff ’s shipyard in Belfast. The first B9 Ship Demonstrator will be launched in 2012, earlier than the NYK eco-ship. Afterwards, B9 says it will build at least 50 ships by 2020. Not clear is whether this ship will be able to cross oceans, which may mean it remains a ship for relatively localized freight. When the first model comes out, the cross water efficiency can be determined. However, it could still lower freight prices. B9 says that, while their ships will still utilize some fossil fuels, their ships will be efficient enough to save the companies who use the B9 and the cargo customers thousand of US dollars per trip. This could mean a drastic reduction and more stability in the price of shipping, as less oil is needed.
Hanjin Does it Differently
T
here are other companies taking the “green concept” step by step; the result may not be a sci-fi looking ship, but the numbers speak for themselves and the technology is available right now. For instance, Hanjin Shipping recently announced that it will start converting its fleet of refrigerated containers this month over to what it calls “eco-friendly” reefers. The South Korean container ship operator started using the containers at the end of May when it began receiving 1,000 units from MCI Qingdao (MCIQ) a Chinese manufacturer of refrigerated containers. MCIQ began converting its production process to an environmentally friendly foamblowing technology in May 2010. MCIQ substitutes “SuPoTeC,” or sustainable polyurethane technology, for the HCFC 141b urethane foam which is ordinarily injected between the inside and outside plates of reefers for insulation. Hanjin said ordinary urethane foam produces approximately 23 tons of CO2 when exposed to the air during dismantlement while Supotec produces only 69 kg of CO2. Hanjin Shipping will only order these reefers whenever it orders or leases new containers. The company says it expects the containers will not only reduce environmental impact but also save costs as they are free from environmental regulations when they are scrapped after more than 10 years of use. HCFC141b
SuPoTec
Ozone Depletion Potential
0.11
0
Global Warming Potential
630
3
CO2 emissions
23,800Kg CO2
69Kg CO2
What will the greener, more efficient cargo ship of tomorrow look like?
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JULY/AUGUST 2010
35
PRODUCT Study
No rigging to foul spars, so better upwind sailing angle
Skysall
绿色航运
Rotating Masts
Nor rigging to foul cargo bandling
60% Thrust from wind
Automated operation lowers crew costs and increases H&S
40% Thrust from engine
相对于航空和卡车，货船通常被认为是向全世界运输货物的绿色方式，因为你可 以增加运量减少运程。但是这些巨大的柴油货轮是臭名昭著的污染环境。据多方报 道，这种污染至少占全世界3-4%的碳排放量。不仅如此，原油价又是运输业中最无法 预料和最动荡的一部分。实际一点，减少货船对原由的依赖不仅可以有利于环境，还 可以有助于船运业的成本低线。这些是发生在绿色航运改革中的一些有趣动向。
B9
B9是一家北爱尔兰公司，其创始人在1983年制造了世界 第一艘帆篷助动的货运船，之后就一直致力于低碳船舶的开 发。现在他们有更大的计划。距B9的研究，目前世界上有 10,000艘油动力船，它们大小和B9的未来船型接近。这些油 动力船每天释放出大约60吨的二氧化碳。B9称他们可以将这 些传统的船舶替换为可靠，环保的船舶,提供可预见性及合理 的运费价格；这样一来可以将二氧化碳排放量减少52,000,000 吨。 2011年B9将开始制造船体长100米，3000载重公吨位的沿 岸贸易低碳船。50米长的桅杆将在贝尔法斯特的哈兰德和沃 尔夫的船厂生产。2012年，B9的第一艘低碳示范船会下水启 航，将领先于NYK的生态船。到2020年，B9至少生产50艘低碳 船。 目前并不清楚这种船是否能远洋运输，可能意味着只能 是小范围运输。但是它肯定能降低船运价格。B9的执行主管 大卫。索浦拉斯声称在美国船运收入每海日在6000到10000美 元，风和生物天然气会吸引双倍的海洋ROC，而出售这些ROC 会产生每海日6000美元的收入，从而改变这些新兴科技的价 值定位。相比较而言，碳交易在可预计的每吨40欧元的条件 下，会省下每海日1000美元；矿物燃料在氧化镁每吨600美元 的价格下，可以节约下每海日1000美元，3000美元的收入减去 处2000美元的生物气花费。
NYK
在2008年，由日本邮船会社(NYK)目前正在开发的 最科幻船舶揭开其神秘面纱，宣称在2030年制造出几乎不 使用矿物燃料的货船，在2050年则完全能摆脱对燃料的依 赖。NYK的研发部指望在计划期内能开发出正确的科技 技术，像强大的太阳能板，氢气能，以及风能。 NYK注重三个理念。首先是降低，指降低不必要的 重量，马达低效能，和由海洋和空气造成的摩擦阻力。 其次是运用新兴科技来产生能量，比如说燃料电池，及 氢气和液体，液化天然气这样的替代燃料。最后，NYK 致力于太阳能和风能这样的新能源开发。这真是一个令 人着迷的发明，不过我们看起来还得等上20年。
一步一步来 有一些公司对绿色航运是采取循序渐进的方式，虽然其制造的船舶不是科 幻般旋目，但效果和科技确实实在在。举个例子，韩国韩进海运最近宣布将 其船队的冷冻货柜改换成”环保型”。5月底，韩进会向青岛MCI（MCIQ， 一家专门制造冷冻集装箱的中国公司，购买1000个冷冻集装箱，然后进行改 装。 MCIQ于2010年5月开始实行环保的发泡生产线，将原来的HCFC 141b聚氨 酯泡沫塑料替换为“SuPoTeC”聚亚安酯泡沫塑料，用于注入冷藏箱的内板和 外伴中间，起到绝缘作用。韩进称常规的聚氨酯泡沫在拆卸暴露在空气中时 会产生23吨的二氧化碳，而Supotec仅产生69公斤。 韩进海运说每当他们需要定购和租赁新的集装箱时，便会购买这些冷藏 柜，不仅能减少环境污染，还能节约成本，因为这些旧冷藏柜在使用十年后 报废，将免于环保法规束缚。
36
JULY/AUGUST 2010
HCFC141b
SuPoTec
臭氧 耗能
0.11
0
全球 变暖 程度
630
3
二氧 化碳 排量
23,800Kg CO2
69Kg CO2
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The Chinese Logistics Sector
as seen from the top Monica Liau picks the brains of some experienced logistics experts at this year’s Shanghai Transport Logistics China trade show.
FEATURE Logistics
What recent
M
Tony Lin
T
Managing Director Dimerco, Greater China
here have been two areas of market slowdown for our industry – and everyone knows this – due to financial turbulence that originated in the US and Europe, which means many global agents’ home countries have been affected. This also has meant lots of cutbacks. The second area is that China used to be 16,000 service providers but during the past two years, at least 1/3 of it is gone. Their finances are just not sound – basically local and state operators have been reduced. From a customer side there will also be a financial impact on European companies – China is becoming a major importer – in the past maybe US or Europe was bigger – but now, German, French and American companies are heading to China to sell autoparts, tooling, consumer goods. This is a market trend change. In the past, most international clients were looking for global suppliers – now they’re looking for local buyers.
y experience is right now centered on Zhuhai – it’s a city of about 3-4 million people but it was sort of left behind when Shenzhen got all that Beijing money. Now Beijing is putting billions and billions of dollars into Zhuhai, especially their port capacity – I mean, the head of Zhuhai port holdings will increase by 5.5 million TEUs in the next 12 months. Plus we are currently building up the largest logistics center in the area, covering 195,000 sqm – with 98,000sqm under cover (when at capacity) – it’s 10min to the new port. This type of monumental project is typi-
Managing Director Geodis, Greater China
38
JULY/AUGUST 2010
Adam J Montgomery Executive Director Volume Group cal of China. I really think that this along with the north-south freight route and the HPH port is going to absolutely reenergize the Pearl River Delta. I mean, it’s always been on steroids here, but these projects are going even further to connect the loop (of Shenzhen, Dongguan, Guangzhou) and create one big city of commerce. At that point Zhejiang had better be worried – I’m quite serious about that.
Dieter Buchinger General Manager M&M Transport Logistics Services
E
specially last year, the global downturn was a challenge.Ocean and air all had reduced capacity; shipping lines had laid off vessel capacity, airlines had disengaged – and now that the market has picked up dramatically, there is still not enough capacity – no one knew where the market was heading. Right now the capacity is certainly not enough to really serve the entire market in a timely fashion. More and more shipping/air are taking capacity back – which means that by mid summer we should be seeing a significant increase in carrier capacity. In terms of customer service, we have had to adopt our business model to bring us back to supplier. We have to be very closely associated with them so we have a very clear forecast of what your volumes might be. We have to be integrated with their process, so we can provide them even in the difficult period. Of course it’s a certain entrepreneurial risk but we commit to our suppliers in good and bad days – it’s a balanced risk.
T
Simon Yam
changes have you seen?
he market has changed from a very controlled and government regulated market to becoming much more dynamic and pretty open . There is more competition; more players – Chinese companies, big, medium and SOE, are getting into the logistics area. More multinationals are coming too. This is positive for us, as the cake is getting bigger and bigger every day – they have a very positive influence on our business volumes, our growth rate and returns
to shareholders as well. The land/labor/environmental costs in China are also getting more and more expensive – the perception that China is an unlimited source of cheap labor is wrong and most of the factories are understaffed. Plus you see wages going up dramatically, and the high social costs. Companies need to pay 50% of their employees’ basic salary to social costs and benefits. This has a domino affect on the transportation services as well.
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FEATURE Logistics
Do cultural
Juan M. Manzanedo CEO Logis Fashion
differencesaffect business ?
W
orking with Chinese companies can be a problem. We did some projects, but probably our biggest drawback is in terms of price. We’re not really able to afford the price they are willing to pay –it’s more a cultural thing. They don’t have very developed warehouses, they’re used to cheap labor, and are not very open to change the way in which they do logistics. They are not global, they are just working here in China, sp they don’t have the incentives. But also, from my point of view, I really
think that these guys they are developing. Some are very big and they have thousands of shops, but they organize their logistics in a very traditional way. They know its inefficient and they want to change, but they do it in the traditional way – they don’t do replenishment like our client, H&M, but they know the H&M model is a good one. They want to copy the model, but don’t want to pay an outside party. This is going to change in the future though when the big guys go international, and it’s a good opportunity for us. It will probably never change for the companies that stay domestic.
Where is the
China sector weak?
A
n unregulated logistics industry, for now, is still the biggest problem – it gets a little bit nasty – there’s not a set standard in terms of logistics, there are instead a million definitions and no one a set standard. I the government is putting pressure on the industry in terms of saying they support them consolidation – but in terms of what way to support it, I think they’re still trying to seek out the way. This is still one Vincent country with a million policies and systems.
I
Chan
Assistant Director, Yat Fai Logistics Group
t’s still so fragmented. You see companies here at the tradeshow that you’ve never even heard of! Smile logistics! Lucky Sunshine! Honesty International! In the domestic market there are millions of these companies and I think in the next 5-10 years it will continue to be fragmented.
Andy Weber President Kuehne + Nagel, Asia Pacific
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Gregor Veselko President, Management Board Luka Koper (Port of Kroper)
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don’t know why we would see a weakness, all of our partners perform very well – but we work with big and renowned ones – I can not speak for the smaller ones.
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e got to China is 2005, and our business model is different here than in Spain, Mexico or any of the other markets we’re in. For instance, in China, it’s very difficult to choose what the best warehouse is – bonded, domestic, expert, free trade zones – then you have the different zones like Guangdong, Shanghai, Hong Kong. We’re working with many different types of warehouse and locations, instead of buying our own, like we’ve done elsewhere. It’s just, we’re not DHL or anything, and we’re not going to have our own warehouses in hundreds of different locations. This is also a risk because right now, we don’t have so much investment in China and we need that investment in the future. We really need to have our own warehouses – telling our customers that you’re going to take care of their logistics when you don’t’ have a customized warehouse can be a disadvantage. But we don’t’ want to invest until we have a clear path in the best way to do this.
Juan M. Manzanedo CEO Logis Fashion
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n my industry, the challenges I see come from the fact that there are so many new players coming into the market, which leads to overcapacity. When you have over capacity, everyone is trying to ensure that people are trying to keep up and make their production still produce. It leads to stiff competition which in turn leads to price wars and price erosion, which means that
some people will suffer. This in turn leads to unhealthy industry growth. If everyone is cutting back, who will invest in R&D and technology? Another challenge for us is commodity fluctuations – you look at the fluctuations of prices and it’s crazy! Also, the exchange rate – its something you can’t really control but it still has a big influence on us.
C.P. Quek CEO Linde, Forklift
Andy Weber President Kuehne + Nagel, Asia Pacific
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ecruiting staff with developed logistics and supply chain skill sets is difficult – there is a big lack of this particularly in China, especially entry level. In places like Europe, many undergraduates have been studying supply chain and logistics since high school. We are growing here exponentially and not having skilled staff that you can use immediately can be a big strain on management because we have to maintain service and grow the company while still training staff and working on classroom sessions. We have continuous vacancies that need to be filled.
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What
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challenges are you facing ?
e focus on three pillars of customers; electronics (Dell, Motorola and Samsung) the chemical sector (BASF, Exxon Mobile and GSK) and the food industry (like Heinz). When it comes to supply chain requirements, they all come with special challenges. Electronics are the most time sensitive because those products are just like fashion. Three months and the product could be done. This puts pressure on the supply chain. In the auto industry, just in time means it need to be packed up within a day – but for electronics just in time means packed up within 60 minutes – our customers have raised their requirements. Think about it – a computer alone has over 200 components per computer, and if the order is for 3,000 notebooks, then we have 60 minutes to pull 600,000 different components from our suppliers. Dealing with this is ingrained in our system - we have a team of 250 IT specialists that focus solely on upgrading and improving our supply chain system. We also use RFID – some of these components are very expensive and the traditional check box way can’t be done in an hour, so our system is all automated. The chemical industry is focused less on speed and more on health, safety and environment – they don’t mind being a little slower – one incident can cost your future, like BP. But the Expo did make things interesting for that sector. The thing about China is that whenever there is an international event, the government becomes extremely cautious. Even though we had a corporate license, we were sent for training, we have to a contract our logistics – and they make it quite inconvenient – but in some ways this is good. Singapore and other places are strict – China is not as strict usually – but switching to the other extreme in such short time is difficult. The government gives you very little time to prepare. Cold chain is probably one of the biggest challenges in China. How do you maintain the same temperature for the whole supply chain? You need to have the right infrastructure, a proper warehouse (for instance ice cream can only have a deviation of 1-2 degrees), plus trucking that ensures the temperatures. Sometimes the outsourced truck drivers don’t maintain temperatures in order to save on fuel. The customer can reject the goods if the temperature isn’t maintained. Because of this, we use a lot of software and we trace the temperature – if it fluctuates an alarm goes of.
Dieter Buchinger General Manager M&M Transport Logistics Services
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t’s also still a fact that in China it’s harder to forecast supply – but if you had these same talks 4-5 years ago – we probably would always be talking about peak seasons in China. It was a given fact you had a very volatile market – this was mainly related to the fact that those companies had difficulties with their production – they were always late for seasonal/festival stuff. Over the last 4-5 years what we’ve seen is that those guys have got their process back under control, so the volumes are more even. It’s still not a German/US company level, but its certainly a lot better than it used to be.
www.supplychains.com
It’s also still a fact that in China it’s harder to forecast supply – but if you had these same talks 4-5 years ago – we probably would always be talking about peak seasons in China. It was a given fact you had a very volatile market – this was mainly related to the fact that those companies had difficulties with their production – they were always late for seasonal/festival stuff. Over the last 4-5 years what we’ve seen is that those guys have got their process back under control, so the volumes are more even. It’s still not a German/US company level, but its certainly a lot better than it used to be.
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FEATURE Logistics
What’s in store
for the future?
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government movement is encouraging consolidation of the automotive sector. We see already for instance Psyche which acquired Nanjing auto and Chana squired Haifei. You will see a little more of this in the future. The Chinese government has nominated two tiers, and four manufactures to become global brands – Chana, FAW, Donfang, and Psyche – and then there are also regional brands, etc. It’s really important that the industry be consolidated.
Robert Jan Timmerman Area Manager, Greater China Managing Director Panalpina
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e are sitting on a gold mine here, in every sense of the word. China has it all – the infrastructure, the diverse customer base. The challenge is whether the manufacturing base can keep up with growth and demands.
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Trond Tønjum Managing Director Wallenius Wilhelmsen, China
Edoardo Podesta Managing Director Dascher, Greater China
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n the next five years we expect there to be a shift in production and consumption areas. It has been very interesting in the past few days with the Foxconn drama, and I think that because of these rising prices of labor, certain heavy manpower industries will have to relocate to new areas. So we are also moving west to anticipate this – we’ll open 2-3 second tier offices. We went through the first phase of working here on the coast and now more and more we are moving westward. We are following where airports are going in. If you are talking about supply chain, we follow the demand of our customers, and most of the infrastructure is there already.
cated origin services – this could include doing procurement in the e think of the logistics industry today as a 300 origin market –is a big added value for customers in the US/Europe billion Euro market that is very fragmented. We who have little experience in the Chinese market. are the number four in the global market, and to In terms of freight management, our margins are somewhat less move up we’re focusing on a few things. than our competitors because we have tended First, we’re working to build up our contract to operate in a somewhat decentralized way. We logistics business in sectors where we have been have a big global program which works on havrelatively weak – technology and consumer reing the same systems globally – same computer tail. Tech works because we have a good freight system etc – it allows us to improve our cusmanagement business but we need to expand tomers service . The program is called “UNO” that to end-to-end consumer retail. which refers to one truth, one data, one system Next, we are number 15 in ocean freight – for the entire global network rather than 400 I don’t usually quote that number – but we’ve different truths for each branch. been growing about 50% yoy. What we see as The last focus is that we believe the customour added value here is not focusing simply on ers we should focus on are the big sophisticated the container, but on the origin and destination multinational companies that have gotten to the services. The difference between ocean freight point where they appreciate what we do and and other parts of logistics is that there is a the services we provide. Our top 100 customlower share in the business for 3PLs like us. ers represent 55% of our business, but we only Ocean carriers are a much more significant John Patullo have around 5% of their total logistics spend. part of ocean freight than say, airlines are with CEO We’re working to drive business with our biggest airfreight. This brings an important aspect of CEVA Logistics customers. competition. Being able to provide sophisti-
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变革 Adam J Montgomery 执行董事 Volume Group
Tony Lin 董事 中菲行，大中华地区
目前行业内有两个市场领 域正面临着增长放缓的尴尬这一点似乎显而易见-由于欧 美国家的金融局势动荡，许多 全球代理商在母国的业务在过 去的2-3年间都遭受大量的削 减，另一方面，中国曾经有 16,000多家服务供应商进驻， 而如今至少有三分之一的公司 选择了离开。由于财务状况并 不乐观，地方和国有的运营商
就一直在减少。 从客户角度来看，许多欧 洲公司也受到财政因素影响— 中国已逐渐取代美国和欧洲， 成为最主要的进口国。如今越 来越多主营汽车配件，模具， 消费品等的德国，法国和美国 公司进驻中国-这已成为了一 种市场趋势。大多数习惯于和 全球供应商合作的国际客户， 已转向和本地的采购合作。
全球经济的衰退对每个公 司都是个挑战，尤其是去年， 海运和空运的货运能力都明显 下降，航线也相应减少—几时 今年的市场明显好转，但运载 力依然有限，谁都无法预测市 场发展的方向。目前的航运能 力明显无法及时满足整个市场 的需求—当然越来越多的海运 和空运能力都有明显回升的迹 象—或许在这个夏季的中期，
我们能迎来一个全新的物流运 输高峰。 在客户服务方面，我们不 得不采用我们的业务模式来继 续赢得供应商的支持，比如对 供应商资源的分类与整合，并 给予他们相应的支持。可以通 过与供应商之间密切的联系来 确保供应商能得到即时准确的 货量预测。我们需要完全的融 合到供应商的日常操作中，并 从他们的角度着想，这样即时 在困难时期，供应商依然能从 我们这走货。当然，这种做法 有一定的风险，但考虑到我们 对供应商的承诺在经济景气和 衰退时期都一样适用，均衡下 来的风险还是在可以接受的范 围内。
Dieter Buchinger 总经理 M＆M名品国际货运代理有限公司
挑 战 www.supplychains.com
我的经验主 要来自珠海—这 是一个拥有300-400万人口的 城市，但经济发展的速度还不 及深圳，也没得到过什么投资 商的青睐。而现在，北京却愿 意投资数十亿美元的资金来建 设未来珠海的深海港码头—珠 海港口集团很可能在未来一年 内增加550万TEUs的吞吐量。 加上目前正在建设的港口区 域，总面积达到19.5万平方米 （其中9.8万平方米为储备面 积），只需要10分钟就能到新
的码头。这是中国发展中典型 的里程碑式项目。随着南北货 运发展和HPH港口投资集团的 各种举措，对珠江三角洲区域 的临港工业发展都有十分积极 的意义。珠海港能充分发挥深 水良港的优势，开拓更多的航 线，并作为连接深圳，东莞， 广州的海上对外窗口，打造国 际大港口城市。往深处想，这 一趋势对浙江来说是不小的威 胁。
Simon Yam 大中华区董事总经理 乔达国际货运（香港）有限公司
当前的市场已经从政府 监管下的规范市场变得更为充 满活力和开放—规模成倍地增 长，客户所能获得的信息的渠 道也更为广泛。激烈的竞争， 越来越多的大中企业，国有企 业，跨国企业都参与到物流领 域的博弈中。当然这对我们来 说具有十分积极地意义—蛋糕 越做越大，物流服务的需求也 水涨船高—这对物流业务量的 提升，企业增长和股东回报率 都有十分积极的影响。 欧元最新的动态也为市场 带来了不小的变化。随着欧元 汇率降低，欧洲出口到中国的 货量随即增长。这个变化各有 其利弊—欧洲作为中国最大的 出口国之一，一些政府债券即
将破产的负面消息显然对其贸 易形象不利。 土地、劳动力、在中国 的环保费用都越来越昂贵-中 国已不再是一个生产成本低廉 的国家，而许多工厂还面临着 人手不足的情况下。工资不断 涨，高昂的社会责任成本，让 许多企业不堪重负，公司需要 支付雇员50%的基本薪金作为 社会福利的一部分。这一点对 物流运输服务也有类似多米诺 骨牌的影响效应。
目前中国市场的供应链依然是一个相对难以预测的课题–倘若是在4-5年以前我们来对这个课题进行讨论的 话–或许我们会仅仅局限在讨论关于中国市场的旺季或是高峰期。市场中不稳定的因素太多,这已经是一个不可 否认的事实 - 这主要归咎于企业相对匮乏的生产能力-对季节性/节日产品不是产能不足就是慢一节拍。在这过 去的4-5年，我们共同目睹了这些企业的生产过程都得到了相应 Dieter Buchinger 地控制，所以产量渐渐稳定。但这还未能到达德国/美国企业的 总经理 水准，只是相对过去而言,已经得到了明显改善。 M＆M名品国际货运代理有限公司
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FEATURE Logistics 我们在2005年进驻中国，当时我们的商业模式和西班牙，墨西哥或其他市场都不一样。比 如，我们发现在中国找到最合适的仓库真是件头疼的事情。在类型上，我们需要考虑选择保税 区，国有仓库，专业仓库，或是自由贸易区；在区域上，我们也犹豫时在广东，上海，还是香港 比较好。目前，我们还是选择和不同区域，不同类型的仓库合作，而并不购置私 有专属的仓库。我们并不是DHL或其他资金雄厚的物流公司，因此我们并不准备 Juan M. Manzanedo 在数百个不同的区域投资建设自己的仓库。 总裁 当然，缺少在中国投资的经验也是有风险的，我们需要在未来投资自己的仓 Logisfashion 库—当我们为客户提供物流服务时，没有独家专属的仓库明显在竞争力上略逊一 筹。不过在我们决定好最佳投资类型和区域前，暂时还不准备将其付诸实施。
我们将目光锁定三大 类消费群体;电子类（戴 尔，摩托罗拉和三星）， 化工类（巴斯夫，埃克森 移动和葛兰素史克）和食 品类（如亨氏）。当涉及
Goh Yong Seng 中国区总裁 YCH Group
到供应链要求 的时候，就面临各种的挑战了。因为电子产品不断更新换代,因 此对时间的敏感度最高; 或许某款电子产品的热潮仅能延续3个 月的时间后便从市场上彻底销声匿迹。供应链会因此面临着巨大 的压力。在汽车行业里，我们最注重的就是及时性,这就要求所 有的组装说在一天的时间里完成-但对于数码产品,它就要求在 60分钟内完成组装-我们的消费群体对产品的要求不断提高。处 身设地的考虑- 光是一台电脑就含有200多个零部件，如果订购 3000台笔记本电脑，那么我们就需要在60分钟的时间将600000个 不同的零部件相继组装起来。对于这个问题的解决我们已经并仍 在做各方面的努力-我们拥有250个IT专员来专注于研究产品的更
在这个行业里，目前我遇 到的挑战主要源于行业新进企 业所导致的产能过剩。这种情 况下，每个人都为了保证市场 份额而不愿意减少产量，这就 直接导致了激烈的价格竞争， 必定会有人因此受到价格降低 的影响。反之，这种恶性的 竞争还有影响到产业的正常发 展—如果大家都勒紧裤带，谁 还会去投资和研 发新技术呢？ C.P. Quek 总裁 我们的另一 林德叉车 个挑战是商品的 波动 - 你看看 价格的波动有多 疯狂，难以捉摸！此外，汇率 的浮动 - 即使这是个不可控 因素，但它确实对我们有很大 的影响。
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新变革和改善供应体系。 我们还利用RFID（电子标签技术） - 其中的一些组件是相 当昂贵的，而我们传统的检验方式无法让我们在一小时内完成组 装，所以只有全自动化的系统才能满足这一要求。 化工业的重点则不在于生产效率，但着重强调健康、安全性 及环保 – 所谓欲速则不达，有时甚至慢一点都是可以接受的因为仅仅是一个小差错就能够让整个项目功亏一篑，并让客户蒙 受巨大的损失。世博会的召开也对化工业的发展产生了不小的影 响，对中国来说，每当一个国际性的事件发生，政府就变得格外 谨慎。尽管我们已经有了所有要求的企业营业执照，政府还是要 求我们参加培训，并实习物流合同制-这让原本的操作流程复杂 起来，但有时候也是好事。若是以往，新加坡或其他地方的要求 比中国要严格得多，可是在短时间内一下子变得如此极端严格， 政府让我们根本没什么时间来准备应对新的政策。 冷链物流在中国的发展也遭遇各种挑战—比如，如何在整 个供应链过程中保持同样的温度—你需要有相应的基础设施，物 流仓储设备（比如存放冰欺凌的冷柜只能有1-2度的温差），货 运卡车需要保证运输中的恒温，并选择正确的渠道和路线送到各 家公司。此外，一些外包的非专业货车司机很可能会因为节省燃 料，并未让卡车保持恒温。而一旦客户发现货物并不是在恒温条 件下送达，就可以拒收货物。正因如此，我们会使用许多软件来 跟踪货物所处的温度状态，一旦温差超过固定值就会发出警报。
Andy Weber 亚太区总裁 新加坡德迅货运代理有限公司
招聘有熟练物流与供应链技术的员工是很难的,在中国这方 面的人才十分缺乏，特别是基础水平的。在有些地方比如英国， 很多本科生从高中就开始学习物流与供应链的知识。我们在中国 的发展迅速，但却没有能立马可以利用的熟练工，这对管理整个 工厂来说是一个很大的压力。因为我们要在维持工厂对外服务和 企业成长的同时，还要训练员工，并需在教学方面投入工作精 力。在这方面，我们需要不断地努力来填补这些空缺需要填补。
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FEATURE Logistics
未来 我预计市场在年底前会有 一个持续稳定的发展。在过去 的四五个月中，我们已经看到 超过50%的增长率，我希望全 年平均的增长率能达到505。 同时，我认为空运和海运的市 场也会在未来三年有10-15%的 增长，进口量的增长或能达到 20-30%。国内运输业在一年内 就能增长20-30%。不过最终， 我还是相信铁路和陆路运输会 逐渐取代部分国内空运市场的 份额。原因何在呢？空运货物
的交货期往往需要通宵或一天 的时间，这一点铁路运输也能 做到，但只需要空运1/4的成 本。这一点是我所能预见到的 主要变化—基础设施的更新会 越来越快。
Tony Lin 董事 中菲行，大中华地区
Edoardo Podesta 总裁 Dascher, Greater China
中国现处于一个不折不扣 的黄金发展阶段，拥有一切公 共建设及多种多样的客户，所 面临的挑战是其生产业是否能 紧随需求及增长的脚步。
Robert Jan Timmerman 大中华地区总裁 董事总经理
在未来五年，我们预计生 产和消费领域会有一些变化。 富士康事件导致的劳动价格上 涨，让一些劳动密集型的产业 不得不搬到新的地方。因此， 我们会在西部城市开办2-3个 办事处，并向西部转移部分工 厂。最初进驻中国，我们将工
厂地点设在沿海地区，而我们 下一步的策略是向西部转移， 并更多地考虑选择机场附近的 区域。在供应链这一方面，我 们会根据客户的需要，并结合 基础设施的配置情况而选择相 应的解决方案。
在 和 天 津 港口商谈的合作 管理委员会总裁 协议上，我们已 Luka Koper (Port of Koper) 经做了很多方面 的努力，现在我 只希望尽早能敲 定并落实这一协议。这将是我们与中国建立良好关系的一个标 志，我们可以全面地审视与中方合作的各项事宜，同时这也是 我们交流经验，共享信息，携手合作的大好机会和平台。这个 过程我们努力了几乎一年，希望光明就在眼前。
Gregor Veselko
www.supplychains.com
政府目前的政策导向是有 利于汽车业的整合。我们已经 看到这样的实例，Psyche兼并 了南京汽车，长安汽车兼并了 海菲。你会在将来看到更多这 样的例子。中国政府设置了两 个管理层以及四个生产厂家来 打造全球品牌-长安，一汽， 东方以及Psyche- 当然也有些 地方性的品牌等。由此可见产 业地位的巩固是相当重要的。
Trond Tønjum 总裁 Wallenius Wilhelmsen, China
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FEATURE Logistics
John Patullo 执行总裁 CEVA Logistics
我们认为当今的物流业为3千亿欧元的欧洲市场服务是十分 零散的，目前我们在行业内位列第四，未来，我们希望能通过 一些的变革来加速发展。 我们正努力在相对薄弱的物流环节—技术和零售方面寻找 合同物流业务的合作对象。在技术产业这块，我们有一个良好 的货运管理机制，但需要扩大到零售终端的点对点服务。这是 一个有趣的领域，我们相信会有一些跨国企业会对我们的服务 感兴趣。 在海运方面，我们仅排名15—通常我并不引用这个数字， 但是我们一直保持着持续增长的势头（同比增长约50%）。我们 所关注的附加值不只是在货物存储上，还包括原产地和运输地 的相关服务。海洋运输和其他物流方式的不同在于，与我们类 似的第三方物流商所占的市场份额并不多。货运船只本身显然 是海运最主要的部分，就好比航线对于空运的重要性一样。这 就是竞争中我们需要特别注意的一个方面—若能为原产地市场 提供采购服务，比如购买原材料，及时安排生产服务来配合出 货的船期—这对一些在中国市场经验不足的欧美客户来说，是 一中十分诱人的附加值。 在货运管理方面，我们的毛利与竞争对手相比，或许是因 为我们还是倾向于较为分散的经营方式。我们有一个全球化计 划，可以让我们全球都能用同一种计算机系统—这可以有效地 改进我们的客户服务。该项目被称为“UNO”计划，指的是同 一个数据源，同一指令原则，同一系统地运用在全球的物流网 络，而不是400多个网点都用不同的指令原则。 最后一个重点是，我们相信我们应该关注的价值客户是一 些大型的跨国企业，并引导他们关注我们所能提供的高附加值 服务。排名在前100位的客户代表了我们55%的业务，但我们却 只在他们的物流业务中占5%。因此我们需要花更多的精力在推 动大客户业务的发展上。
在中国和亚洲北部，那些成功的公司经营者大都有一个共同点----跨行业经营。他们涉足各 个行业，在整个供应链上都要分一杯羹，从原材料生产商到终端使用客户赚钱。看看亚洲首富李 家诚就知道，他掌控着半个庄臣洗发露产业，他又把他的产品装上自己物流公司的卡车，运到香 港，摆到他旗下的快捷连锁店屈臣氏的货架上销售。这个环节中的每个步骤，他都能获利。传统 的西方经营模式却不太一样，西方公司只着眼于一个环节，但在亚洲北部，这种专一的态度却不 被接受。要想多赚钱，经营者就必须从头到尾都抓 Adam J Montgomery 住。这就是沿袭了数百年的生意模式，我相信这种 执行董事 模式连鸦片贩卖商都知道，他们不仅卖鸦片，一定 Volume Group 还卖抽鸦片的工具。
和中国公司合作会遇到很多问题，在一些我们所做的合作项 目中，我们遇到的最大的难题都与价格有关。中方公司愿意支付 的价格往往过低，这就牵扯到不同国家的文化了。中国的公司的 仓库大都比较陈旧，他们习惯于雇用廉价劳动力，却不愿意改变 他们的物流运输方式。中国公司并不国际化，因为他们只在中国 运营，这样他们看不到任何的竞争激励。 但同时我也发现这些中国公司渐渐开始发展。有些公司规模 很大，配有数千艘货船，但他们的物流模式过于传统。我们的客 户H&M实行补仓制，中国公司发现了H&M的物流模式的好处并尝试 改变自己原有的低效模式。他们试图复制H&M模式却不愿意承担 额外费用。但当这些大型中国公司走向国际市场后，他们对投资 的态度就会改变，这对我们而言是个绝佳的机会。然而，那些止 步于国内市场的公司却永远不会做出任何改变。
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文化 差异
Juan M. Manzanedo 总裁 Logisfashion
www.supplychains.com
FEATURE Logistics
优缺点 Gregor Veselko 管理委员会总裁 Luka Koper (Port of Koper)
Vincent Chan 助理总监 Yat Fai Logistics Group
现在最大的问题还是物流行业不够规范。一切都很混乱， 我们看到的是成千上万不同的定义和规则但却没有一条公认的标 准。中国政府承诺支持多式联运，这样一来就给行业制造了压 力，因为问题是政府仍在寻找支持多式联运的途径。中国现在仍 是多政策多体系的国家。
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我并没有看到缺点，因为和我们的合作方工作的十分顺利， 但我并不知道小型企业的情况，因为我们只和大型名企合作过。
一切还是一盘散沙。在展会上 还是有很多从没听说过的公司，诸如 Smile物流，Lucky Sunshine，Honesty 国际。在中国市场有数以万计这样的 小公司，而且我认为5到10年内这种情 况仍会延续。
Andy Weber 亚太区总裁 新加坡德迅货运代理有限公司
JULY/AUGUST 2010
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FEATURE Manufacturing
Why Lean
Can Happen Anywhere A Story of Change
F
or over three decades I have been working with major multinationals through some tumultuous times, and it seemed that change was never ending. New global computer systems, new manufacturing and warehouse systems, Total Quality Management, (TQM) Management by Objective, (MB0), World Class Manufacturing, (WCM) (now called Lean) and many, many more. I was invited by the editor to write an article on why some of these changes fail, but I quickly realized I would find it easier and hopefully more interesting for the reader to describe how change succeeds. During these last three decades a formula has evolved for me, which for the last fifteen years allowed me to turn failing and ordinary factories into benchmark sites. I have successfully managed factories in Ireland, USA, India and China. In every case the competition was fierce. Within multinationals each manufacturing source is con-
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stantly being compared. You fight to hold what you have, and try everything at your disposal to attract new investment. To begin the change process at factories, I lay out the challenges, threats and also the opportunities that we may face should we go forward with implementing change. I create a vision that usually is something like “We will be among the best in the world among our competition.� I tell them that I have a toolkit, which I can apply with their support, but before completing the formula I need their input. So I ask them 4 key questions: what is working, what is not working, what we should retain, and what we need to do to become a great plant. I bring in external facilitators to conduct this exercise with the entire workforce in groups no larger than 20, so that involvement and confidentiality is ensured, and I have the results printed in booklet form and every employee gets a copy. The results rarely surprise; rather they confirm what I am usually observing, but it is a
wonderful tool to show everyone that their opinions matter. Meantime, I am appraising managers at all levels, identifying who is going to embrace what needs to be done, and who will get in the way. It is my experience that at least one third of senior, middle and front line managers need to be separated. Usually, I take on board a small team of consultants I know and trust to help accelerate this process. It is absolutely essential that the people, particularly those at senior level, who are not going to make it are quickly removed. Otherwise, momentum will be slowed down, and undermined by their presence. The Leader must be absolutely ruthless in this, because the greater good, perhaps the very survival of your plant, will be jeopardized. In parallel with this, we set about putting our Lean tool kit in place. I like to do things in parallel. So I get the purchasing department working with key suppliers to get new kinds of working agreements in place. Kanbans go to our
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FEATURE Manufacturing
warehouse to start more deliveries in smaller batches. Kanbans go to our factory floor in order to start with a key product that represents a substantial percentage of our total business, ranging from 30 to 70%. I start with something substantial, so that a large number of people are involved, and generate excitement. The expert consultants I bring in teach people necessary skills including process mapping and get people working throughout the plant to generate improvements. We start to get people thinking about value streams, and usually within three months have one beginning to come together, and others identified to work on later. Bills of materials get redesigned to allow for back flushing, as a feature of my factories is that we only transact materials into the warehouse from suppliers, then to the shop floor when it moves there. We then use back flush to update the system when finished product is booked to the warehouse. The elimination of transactions for work in process (WIP) saves an enormous amount of time and frees up considerable resources. Meantime, we are also changing our financial reports so that every work center has data that they can
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make sense of, so that they can track their own performance. All data collected is analyzed. If it is not adding value and being used to inform and improve, it is eliminated. With all of these programs in play and the non-contributing managers and key staff gone, my credibility becomes well established. What I have promised, I am delivering. I have laid out the challenges facing the plant, backing it up with clear evidence. I have asked the workforce to answer the four key questions, therefore taking their views on board, I am separating those not delivering. The factory is looking much better through the 5 S programs, and painting and refurbishment. Data not being used has been dumped, new reports from every department have been redesigned and now both inform and add real value. Space has been freed up in the warehouse and shop floor through the introduction of Kanbans. Value Streams are being created with people from all disciplines sitting together where possible. Usually after three months great excitement has been generated, with many programs already in place. After six months a very substantial change in both the atmo-
sphere of the plant, its appearance and in improved results is visible. After one year the change is truly spectacular, and then just keeps getting better as people become more familiar with the new way of working and with the various tools and techniques. This is what works for me. I have achieved the most spectacular results within my (then) wider organization. The plant I was sent to close in the USA was declared a Benchmark site within two years. The Ireland plant survived and still thrives. In my last assignment in Shanghai, I also left a benchmark site behind. With my formula there is no failure, only spectacular success!
Liam Cassidy has over 30 years experience managing manufacturing plants. He was the leading plant manager of Lean Practices throughout his career with Gillette and Proctor & Gamble in Ireland, USA, India and China. He now provides consultancy support to organizations that need help and has bases in Ireland and Shanghai. Contact him at liam@concultlcl.com.cn
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FEATURE Manufacturing
在
超过三十年的时间里，我一直在一些大型的跨 国公司动荡的环境下工作，从中看来革新从未 结束。新的全球电脑系统，新的制造和库存系 统，全面质量管理(TQM),目标管理 (MB0),世 界级制造业(WCM) (现在叫作精益)，以及其它 很多方面。这一次，我被编辑邀请撰写关于为什么有些革新会失 败的文章，但是我很快意识到发现革新是怎样成功的更加容易, 并也发现读者或许对革新是怎样成功的更感兴趣。在过去的三十 年里，我已摸索出一个方案，这个方案使我能够把普通的甚至是 失败的工厂改造成行业内的模范工厂。 我成功地帮助了在爱尔兰、美国、印度和中国的许多工厂进 行改革。每一次的竞争都很激烈，因为那些跨国公司会不断地进 行比较。你必须充分利用你所有的优势，并用尽一切办法来吸引 新的投资。 在开始革新前，我陈列出我们在革新中可能面临的挑战， 威胁和机会，来阐明我们是不是应该要实施革新。我设计一个愿 景，通常是类似“我们将于我们的竞争者们一样成为世界上最好 之一”。我告诉他们握有一个工具包，在他们的支持下，我能够 使之发挥作用，但是在完成方案前我需要他们投入资源。因此我 会问他们四个问题：什么有用，什么没有用，什么我们应该保 留，和我们需要怎么做才能使我们成为一个伟大 的工厂。我引进外部服务商来和不到20组的全体 员工执行这个任务，这样一来保证了参与性和保 密性，而且我把结果打印成小册子，发给每个员 工。这些结果很少会出人意料；不光是因为他们 能肯定那些我经常关心的东西，并且这是一个很 好的方法告诉每个人他们的观点的重要性。 此外，我会对各级管理人员进行评价，并确 认谁将要从事那些需要被做的事，谁将会成为阻 碍。从我的个人经验来看，至少三分之一的中高 层和前线 管理人员需要被分开。通常，我会在 董事会上雇佣一个我所熟知并信任的小型高级顾 问组，来帮助加速这个进程。那些不能够完成任 务的人，特别是在高级管理层的，毋庸置疑地讲被很快开除出 去。否则，整个计划的实施速度将会放慢，并因为他们的出现而 逐渐消弱影响力。领导者在这一行动中必须要冷酷无情，因为若 不如此，更大的利益或者工厂的生存与否都将以此受到威胁。 与此同时，我们把精益工具包放在适当的位子。我喜欢公平 地做事。所以我让采购部辅助主要供应商工作，以此来在适当的 工作中获得新的工作协议。看板到我们仓库开始更多小批次的交
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付。看板制到我们车间主要是运用在关键产 品的交付，所谓关键产品指的是占总交易量的 30%到70%的货物。 我从主要的产品开始着手，这样就会牵涉到许 多人参与进来，大部分人都感到兴奋并跃跃欲试。 我带来的专家顾问团教大家必要的技术，包括操作程 序规划和使大家在车间里处处都能产生进步。我们开始 使大家思考价值观，通常在三个月中，大家聚到一起构思一个草 案，然后通过讨论发现其他的问题和解决方法，并在接下来的实 施过程在逐渐起到作用。条例草案的材料重新设计，允许重复生 产回冲，我们工厂的一个特点就是，我们只从供应商手里购买材 料到仓库，然后运送至车间。然后当完成品被仓库预定后，我们 可以利用反向回冲更新系统。 在制品(WIP)交易的淘汰过程节约了绝大部分的时间，且释 放了相当多的资源。我们也改革我们的财务报告，这样每个工作 中心都能搞清他们的数据，以便他们跟踪他们自己的表现。如果 这不能增加价值，不能用来及时通知大家和改进工作，那么它将 被淘汰。 伴随着所有这些计划的进行，没有贡献的管理者和雇员将 被革职，我才得以建立良好的公信力。我才能提供我所许诺的服 务。我已经把工厂要面临的挑战都列出来，并举出 相应的事例作为依据。我已经要求工厂员工回答 这四个问题，并把他们的回答在董事会上讨论。 工厂经过 5S计划，油漆和清理装修，看上去要好 多了。我们删掉没用的数据，并重新设计每个部 门的报告，只有与时俱进的信息才有了真正的利 用价值。仓库和车间的空间经过看板制的筛选后 得以释放， 人们用他们的价值观制造出各种行为 准则，并利用在任何可能用到的地方。 通常，三个月后，当很多计划都已经到位 时，令人兴奋的事会发生。在六个月后，工厂的 气氛，工厂在外表，生产能力与质量上都会有显 著的提升。一年后，改变则更为惊人了，而那时 只要继续保持就会持续变得更好，因为人们已经越来越熟悉新的 工作方法，并能熟练利用各种新的工具和技术来投入工作。 这就是我的办法。我已经在我(后来)更大的公司中得到更广 泛的运用。那个我被派遣去的本要关闭的美国工厂在两年后已成 为了模范工厂。爱尔兰工厂生存了下来，发展前景一片大好。我 上一次在上海的任务完成后，同样也留下了一个基准站点。用我 的方案和发展，不会有失败，只会是令人瞩目的成功！
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FEATURE Manufacturing
精益化生产 —中国还缺什么 龟兔赛跑-乌龟制胜
我
的一位硅谷客户在珠江三角洲的几个工厂采购产 品时，这位客户都十分注重发展供应商和培训新 技术。因此，当其中一家工厂的产品质量达不到 公司要求的标准时，供应链管理副总裁就派出了 一个技术小组前往该中国工厂传授并指导解决问题的精益生产技 术。他认为这一做法可以让中国供应商像美国工厂一样充分利用 精益化生产技术改善生产流程并解决质量问题。 这个技术小组到达东莞并前往工厂并为其做了精益技术的简 单概述。工人们似乎都饶有兴致地专心学习。第二天，这支来自 硅谷的团队便召集了所有生产线上的工人开始学习如果发现并解 决生产质量问题。然后3个小时过后，技术小组不得不充满挫折 地结束了培训---没有一个工人来参加，也就不会有人会知道怎 样获取并收集分析数据来发现生产过程中的问题，更不会有什么 志愿者来示范指导。 到底是怎么回事呢？这个培训能充分阐释精益化原则，方法 可靠且容易理解，为什么中国工厂的工人们不愿意参加呢？ 其实这倒不是我第一次遇到这种情况。西方人总是试图为中 国带来先进的理念和技术流程，并期望这些想法能得到中国工厂 的管理者和工人的支持和认同。做到这一点不难，对指导方针的 认可并不意味着在执行力上就能得到明显的改善，当一切照旧并 无改进时，西方人会觉得难以接受。他们为低技术含量的手工工 厂带来全新的技术和思想，到底是什么原 因会导致这些工厂“不思进取”呢？ 最主要的原因就是，这些全新的理念 和技术没有考虑到中西方文化间的差异。 精益化生产的各项原则是根据西方文化中 辩证的思维和协作原则得出的结论。而孔 子思想却教育国人在近3000年的实践中注 重个体的发展，反对辩证的思维。这种思 想在国人的教育初期就根深蒂固，并随着 年岁的增长不断用实践巩固这种思想。比 如说，人的“面子”就比产品的质量要重 要的多—如果一个工人指出在某条生产线上作业的产品有质量问 题，那他的主管就会因此脸面尽失，这样一来，基本上不大会有 人这样直接地指出问题所在。 勤劳努力，踏实肯干对外来务工人员来说，是他们心里最重 要的概念。毕竟，工人们来到工厂的目的就是为了通过努力地工 作改善目前自己和家人的生活。如果你剥夺了他们在生产线上的 时间，就等于无形地带走了他们潜在的收入。精益化生产计划正 是因为占用了正常的工作时间，在一开始就收效甚微。
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精益化生产模式和其他诸如六西格玛，戴明质量管理，全面 质量管理，质量圈等方法论在通用电气，丰田汽车等大公司已有 一段成功的实践经验。它们通常被用作改善工作流程并通过以下 措施来纠正的问题：1）减少浪费2）增加灵活性3）减少工作阻 力4）不断提高工作效率。 这些想法需要有效促进生产力的提高，降低复杂性，从而不 断改善生产过程。同时，这个过程往往会导致裁员或人员调配等 问题。该方法还对工人间的协作能力，奉献精神，分析数据和促 进变革等方面都有不同程度的依赖。 在美国和西欧，精益生产已经成为一种生活方式。工人们 会比较积极地参与到该项目的培训和推广中，即使这意味着要牺 牲一些正常的工作时间。他们会从最基本的课程开始学习如何合 作，奉献，分析数据，并提出改进的建议。在大多数情况下，如 思科，苹果，福特等全球性公司，都会将精益制造技术带到中国 的工厂加以推广。他们传授精益技术，并期望工厂及其合同制造 商也能一并采用。但对中国成千上万的工厂来说，前景却并不如 此简单明朗。在中国，精益化往往遭遇被动参与或抗拒心理的阻 力。 西方国家的精益化生产大多是由生产部，质量监控部门或内 部咨询部门所控制。而在中国，工厂就是完全负责生产，并不注 重过程的完善。生产部只负责生产和生产过程中的监控，质量监 控部门的存在也只是为了保证客户对产品 的质量和规格要求都能得到满足，而内部 咨询部门则是个完全陌生的概念。也就是 说，中国目前现有的这些部门在功能上并 无意向预留时间或精力给精益化生产，不 管所谓的投资回报会有多高。 当我参观一些中国工厂时，龟兔赛跑 的故事时常浮现在我的脑海。中国的发展 势头和速度比世界上任何一个国家都要强 劲，似乎每个人都鼓足了劲头竞相争夺客 户，尽可能地安排生产来满足客户的订单 需求。然而，传统文化的演变却异常缓慢，在某种程度上对新技 术和理念的传播带来了隐形迫害。儒家价值观，如尊重权威，面 子，努力工作等都是中国工人的核心价值观，精益生产原则正是 因为与这些价值观的对立而缺乏可行性。 当然，精益生产原理，技术和方法，已经逐步在某些大型 跨国企业的工厂中得到推广。随着时间的推移和中国制造业的成 熟，这种生产理念和模式很可能会在中小型工厂中也得到推广。 但现在，至少在未来的10-15年，我看到了的是乌龟占了上风。
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FEATURE Manufacturing
Why China
Is Not Ready for Lean Manufacturing The Tortoise and the Hare
O
ne of my Silicon Valley clients is sourcing products from several factories in the Pearl River Delta. As part of the relationship with these factories, my client is committed to supplier development including offering training in new techniques. So when product quality at one of these vendors was not achieving the company’s standards, the VP of Supply Chain dispatched a team of people to go to China and teach the factory problemsolving Lean Manufacturing techniques. He thought the vendor could leverage Lean methodology to improve the processes and address the quality problems, just as they would in US factories. The team arrived in Dongguan and went to work giving an overview class on Lean techniques. The factory workers seemed attentive and interested in learning. The next day, the Silicon Valley Lean team gathered the people from the assembly line to begin the process of working on the quality problem. After 3 hours, the Lean team ended the session in utter frustration. No one participated. No one would identify problems
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on the line. No one knew how to approach gathering or analyzing data. No one volunteered. So what happened? The training was adequate and the Lean principles and methods are sound and easily understood. Why weren’t the Chinese factory workers participating? This isn’t the first time I have seen this happen. Westerners bring good ideas and processes into China and expect these ideas will be wholeheartedly embraced by the Chinese factory workers and management. Chinese say yes, and appear to agree with the instructions. When nothing improves or instructions aren’t followed, the Westerners are surprised. They are bringing new techniques and ideas into low-tech manual factories, so why wouldn’t the factories want to improve and adopt new ideas? What these methodologies don’t take into account are the cultural differences between the Western world and China. Lean manufacturing principles are based on Western ideas and principles including critical thinking and collaboration. The teachings
of Confucius, on the other hand, suggest behaviors that oppose collaboration and criticism and the Chinese have been practicing these behaviors for nearly 3000 years. Children are taught Confucius values in elementary school and families practice them in their daily lives. For example, “saving face” is way more important than concerns for quality. If a worker were to criticize the production line processes as the cause for quality problems, the supervisor would surely lose face. So it is very unlikely that anyone would offer criticism. Being industrious and working long, hard hours is a more important concept to migrant factory workers than anything else. After all, workers have migrated to these factories in order to earn enough money to live a middle class life or return home to improve the lives of their families. The work ethic of the Chinese is legendary. If you take away time from their piece-work or time on the assembly line, you take away earning potential. Lean projects mean time away from normal work and are therefore not consid-
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FEATURE Manufacturing
ered to be helpful. Lean manufacturing and other programs and methods including Six Sigma, Deming Quality, TQM, Quality Circles and others have a long and successful history at companies such as GE and Toyota. They are used to improve processes and address issues that need correcting through 1) Eliminating waste; 2) Increasing flexibility; 3) Smoothing the flow; 4) Continuously improving. These ideas hinge on enhancing productivity, taking away complexity and continuously improving. And this often leads to a reduced need for resources resulting in layoffs or redeployment of the workers. The methodologies also rely on the workers ability to collaborate, contribute, analyze data and make changes. In the US and Western Europe, Lean Manufacturing has become a way of life. Workers readily participate and are compensated even when they take time away from their workstations to work on Lean projects. They collaborate, contribute, analyze data from root causes and recommend improvements. In many cases, global companies such as Cisco, Apple, Ford and others, bring their
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Lean Manufacturing techniques with them to manufacturing sites across China. They teach Lean techniques and expect them to be practiced in their own factories as well as inside their contract manufacturers. But for the hundreds of thousands of other Chinese factories, the pathway isn’t so clear. Lean Manufacturing is often met with resistance or at the very least passive non-participation. Lean programs in the West are often lead by Manufacturing Engineering or QA or an internal consulting department. In China, the workplace is all about production, not the refinement of processes. Chinese engineers are assigned to production and only production. Chinese QA exists to assure that the customer’s specs are being met. Internal consulting is an unfamiliar concept. These functions within Chinese manufacturing organizations don’t have the time or the inclination to take on Lean projects, no matter what the return on investment suggests. When I tour factories in China, the story of the Tortoise and the Hare often comes to mind. China’s development frenzy is moving faster than anyplace else in the world. Everyone, it seems, is racing to compete for
customers and to meet production schedules. But the culture is still moving at a very slow and steady pace and most often wins over new techniques and processes. Confucian values, such as respect for authority, saving face and working hard are the core inner strength of the Chinese worker. Lean principles are just too opposed to these values to be readily adopted. Of course, Lean Manufacturing principles, techniques and methods are gradually being introduced in the large global manufacturing sites in China and slowly adopted. Over time, this may lead to a broader adoption in smaller factories, as manufacturing matures in China. But for now, and the next 10-15 years, I see the tortoise winning the race.
Rosemary Coates is the author of 42 Rules for Sourcing and Manufacturing in China . She is also the President of Blue Silk Consulting and a 25-year veteran.. She can be reached at www.bluesilkconsulting.com
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FOCUS Retail
Doing It
The Rise of the Chinese Sports Brands n Eileen Chow
W
alking the streets in China today, you may notice many young teenagers wearing sports clothing with unfamiliar logos emblazoned on their chests. Looking at the curvy L that is Li Ning’s signature or the sideways V that stands for Anta, you may wonder to yourself, is that a knock-off Nike shirt? No, in fact¬, these two Chinese brands are well established and are quickly becoming Nike’s biggest competition in China. China’s sportswear market is poised to expand at an annual average of 18%to RMB149.1 billion by 2013, according to an estimate by ZOU Marketing Inc. Zou Marketing also notes that branded sports-
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wear in particular has experienced doubledigit growth since 2000. While Nike remains the number one sports brand with 16.7 %market share in 2009, Li Ning surpassed Adidas to become the second most popular brand in China with 14.2%of the market compared to Adidas’ 13.9 percent, according to AdAge. Though Li Ning holds the second place, Anta’s net revenue was actually higher than Li Ning’s in 2009 with a net profit of 21.6%compared to Li Ning’s 11.7%. Other domestic players, such as Dongxiang, Xtep, 361, Hongxing Sports, Peak, and Kangwei are also competing for their share of the pie and have achieved high growth rates in the rapidly expanding market. While Li Ning and Anta managed growth rates of about 20%last year, some smaller brands have been enjoying growth rates of 30%or more. Marie Jiang, analyst at JLM Pacific Epoch, says that this recent emergence of domestic brands will make the marketplace more competitive to the
established international brands trying to grow in the Chinese marketplace Stiff Competition Building a brand name and facing stiff price competition are the two main challenges for Chinese brands competing against the big names like Nike and Puma. In 2002, Dongxiang acquired Kappa, a European brand, and has been working on a marketing campaign that creates a new image targeting an upscale, fashion conscious crowd who don’t have or are not ready to shell out money for the more expensive Nike or Adidas. Chinese brands worked on international imaging through sponsorship; in this instance it was Shaquille O’Neal who gave them the right to use his image, name, and shirt number on their basketball products sold in China. Li Ning also produced a “Shaq” line of shoes. Not to be outdone, other brands have been upping the game by signing similar sponsorship deals with international sports stars. Anta signed deals with three players of the famous U.S. basket ball team, the Houston Rockets; Xtep signed the English Premier League Birmingham City Football Club; and Peak signed Shane Battier, also with the Houston Rockets. Home Game Besides targeting the international mar-
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FOCUS Retail ket, sportswear brands are trying to expand into another market much closer to home. While competition remains intense in Tier 1 cities, brands have realized there is a huge, untapped market in Tier 2 and Tier 3 cities. “Li Ming and Anta penetrate everywhere, even into villages. Nike and Adidas are at the higher end, and most people can’t afford the price,” says Jiang. With Chinese brands penetrating into international markets and taking over the domestic market, are foreign brands such as Nike and Adidas doomed? Perhaps not. According to a recent UBS analysis, Nike could successfully penetrate lower level markets in China by lowering its price. Jiang, however, disagrees with
this approach. She says, “Coach and other brands names have penetrated Tier 2 and Tier 3 cities,
which still have wealthy people willing to buy brand names. But if Nike and Adidas lower their price, they may run the risk of ruining their brand image, so they should seek other ways to penetrate these markets.” Online Another way brands are reaching the market is through Taobao and ecommerce. In April of 2008, Li Ning opened it’s own channel on Taobao. Sales were such that in 2009, Li Ning started to offer its merchandise on its own website. In 2010, Li Ning plans to make it even easier to shop online by allowing users to buy from their website with cellphones and sending coupons through cellphone messaging. Even if Li Ning didn’t have its own online store, other enterprising citizens would have capitalized on the opportunity. As simple search within Taobao turned up 17,427 individual “stores” offering Li Ning merchandise. As Ben Cavender of China Market Research Group observed, “It will disturb things, but ecommerce is here to stay. It will make store distributors provide better service. Kappa is starting to sell on Taobao, but distributors won’t walk away because Kappa has market pull.” Though storefronts are suffering from the loss of business, they are still a necessary part of the distribution chain. Customers benefit from browsing the store and trying out the physical merchandise, even if they end up then ordering it online. Some brands are dealing with the distributor backlash by buying out
or owning their distributors. Which domestic brands survive to battle Nike is still in question. Analysts have differing opinions. A January report from China Construction Bank favors second-tier brands such as Peak and Xtep, which they believe have a better chance of capturing the lower tier markets. However, analysts from UBS and Core Pacific Yamaichi think that smaller brands will not be competitive in the long-term, and will eventually lose out to the bigger brands, which have larger advertising budgets and are eyeing the lower tier market. Whether or not surviving brands will be able to compete with global brands is also a question that remains to be answered. “A name like Li Ning and an identity so much centered around Chinese nationalism don’t travel. Plus, the company needs to truly differentiate from its competitors in a way that is globally relevant in order to expand to international markets,” commented Francesco Wesel from Integrated Marketing Communication on an online article from Adage. What is not in question: China’s sportswear market is expanding and the battle between domestic and foreign sportswear brands is far from over. During a recent retail summit held by the Global Supply Chain Council, delegates discussed the upcoming role of domestic brands.
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55
FOCUS Sourcing
O
n Frances Karamouzis
ne of the most frequently asked questions about China is an attempt to verify the competitive cost structures variables for sourcing business consulting, IT consulting, applications development, maintenance and management or some type business process management services. And more specifically, many clients ask about labor costs as it is one of the single largest components of total cost of sourcing calculations. A comprehensive analysis of the total cost of sourcing for a business or IT process involves an analysis of two components: standard costs (such as labor, real estate, telecommunications and project management) and incremental globalization costs (such as remote management, communications, project trips and incremental legal costs). Also, enterprises should consider the costs of managing or mitigating potential risks (such as country risks, security risks or maturity risk) to arrive at a risk-adjusted total cost of sourcing. Gartner’s analysis of a comparative cost structure assessment between India and China reveals that a total cost of sourcing business case for a vendor or a captive center varies widely depending on enterprise specific business and IT requirements, scope, scale
and appetite for risk. The variability is based on city locations (where coastal China cities might be as much as 30% more expensive than inland China locations), availability of specific skill sets, risk factors (country, security, competency, and maturity risk) as well as available vendor options. Based on analyzing over 240 business case analyses over the last 2 years, Gartner research shows that there is not a simple or absolute ranking of global sourcing country locations by cost. Furthermore, given the
of clients will inevitably continue to drive interest in the analysis of China as a global sourcing destination. Unfortunately, there is no clear yes or no answer as to whether China is cheaper than India, the answer is deal specific and primarily driven by scope, scale, skill set requirements, language requirements and risk thresholds. A more detailed look at costs reveals that there a several factors that have a large variability across city locations in China, therefore, it is imperative that enterprises understand the factors with extensive hi-low ranges. These factors include: (1) the variability of wage rates and attrition across various cities in China (2) the short versus long term cost of real estate as rates vary dramatically over multi year periods given short term government or technology park subsidies (3) large standard deviations in the investment ranges required for human resources readiness (technical, language and soft skills training) as well as IT Services process business models (4) economic variations based regulatory requirements (5) government and legal requirements to manage risk (6) security issues (7) additional investment needed for low English speaking capability and/or cultural affinity. Clients must explore and ensure deal-specific due diligence for the incremental global-
A Matter of Cost Comparing Labor Prices in China & India
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current volume levels for China global sourcing, there is not enough critical mass of completed deals, or a critical mass of established vendors with extensive track records, and authenticated data. However, based on extensive analysis including breakdowns of major variables of costs, Gartner has concluded that the cost structures in China for the largest components of standard costs (namely, labor, real estate, telecommunications) are indeed within an extremely competitive range relative to many of the leading global delivery locations (including India). Therefore, the continued “cost is king� mentality
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FOCUS Sourcing ization factors and analyze risk management costs. Clients need to ensure they assess a thorough total cost of sourcing analysis over a multi-year period in order to determine cost benefits and manage risks. Common Mistakes The five most common mistakes enterprise buyers with regard to cost comparisons are as follows: 1) Enterprise buyers (especially those who have sourced work in India) often compare a rate card from a Tier 1 vendor with operations in India (i.e. IBM, Accenture, Tata, Infosys or Wipro) to a rate card of a tier 3 or tier 4 vendor in China. Simply comparing a rate card for a specific skill set is not a proper comparison because the elements built into a rate that is quoted by a vendor include elements of disaster recovery, and business continuity 2) Comparison of pure wage rate charts. For example, if you look at some wage rate charts in China, you may see a quoted number such as 9K per year for specific for a
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programmer. However, the total cost to the employer is far more because China has a federal tax that is required (similar in nature to US social security taxes) which are currently 50%. Therefore, the cost to the employer is actually 13.5 K (9K plus 4.5K). Beyond that, if the programmer requires a certain level of English proficiency, a premium of of 10 to 15% must be factored into the wage rate above and beyond the market based rate. 3) Assuming competency and skill sets in China and India are equivalent. A project manager or business analysts or even a programmer as designated on an human resource inventory in each of the respective region are not at all equivalent. Project management expertise is quite different. For example, at this particular juncture, a “experienced’ project manager in India can claim a track record of projects involving significant complexity and project size that simply has not yet materialized in China as of yet. Also, the label of of progammer or software engineer in China often refers to someone with experience with embedded (R&D) engi-
neering expertise versus the more commonly used reference in India is related to Enterprise Apps skills. 4) Assuming that there is one singular China cost structure. China is a vast country with over 20 designated hub cities. Cost structures across these various cities may vary by as much as 30%. 5) Incorrect Calculation of total cost of sourcing or risk adjusted total cost of sourcing. Quite often enterprises do not properly account for or comprehensively analyze the following: • multi-year sustainability of cost structures • do not include differentials in program and project management overhead costs • cross cultural communications cost impacts • vendor competency/execution differentials • risk mitigation and/or management costs • potential currency rate fluctuations Frances Karamouzis is a research vice president in Gartner Research and Advisory Services. Ms. Karamouzis focuses on the IT services and outsourcing market and is also the lead analyst for global sourcing research in North America
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FOCUS City
Toilets and Drains
How Nan’An Affects You Everyday
T
hinking about Drains Pause and think about it for a moment. Where do your plumbing products come from? Without them, there would be no shower in the morning, no teeth brushing at night, and certainly no indoor bathrooms at any hour of the day. If you’re based in China, there is a 70% chance that you have Nan’an to thank for your plumbing and sanitation. Nan’an City, located on the southern coast of Fujian Province, is one of the country’s largest bases for plumbing. Nan’an alone supplies nearly half of the domestic market with hot water appliances and most of the porcelain. From Village to Capital When emperors ruled China, Nan’an was originally known as the “iron blacksmith town.” The community was full of people who relied on anvils to shape their craft. However, in the late 1970’s Nan’an started its’ first plumbing production plant, a single facility that seeded the growth of the city as domestic and demand began to develop. 30 years later, the city boasted over 600 plumbing manufacturers which produced up to 3,000 different varieties of products manufactured to 20,000 different kinds of specifications. At present, the Nan’an plumbing business has expanded into sanitary ware, shower rooms, cabinets, equipment manufacturing, parts manufacturing, product assembly, sales market, logistics, brokerage, advertising, training, and other industries which support
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the plumbing trade. This growth is lead by four of China’s largest domestic porcelain and plumbing manufacturers, Nine Animal Husbandry, Chung-Yu, Brilliant and Shenluda. In 2007, plumbing retail sales amounted to RMB20 billion for the Nan’an industry, a growth of 16% from the year before.
dise, as well as creates supporting logistics, commerce, research and development infrastructure. Nan’an also has the Lun Nan Cang professional plumbing industrial zone, which covers an area of 422,002 sqm, is also located in the Nan’an area and is considered one of the countries “key industrial bases.”
Industrial Clusters With the goal to attract more companies and expand the ones already based in Nan’an, the city has several specialized manufacturing parks including the mega and aptly named “China Plumbing City,” which is planned to be finished in late 2010. When complete, this area will stretch across 680,00m2 of land, representing an investment of RMB3 billion. The first phase, which was finished in 2005, already occupies 928,000sqm and was purported to attract 300-plus merchants (according to the Nan’an government) in the trade. The “China Plumbing City” provides a place to display, exhibit and store merchan-
Continued Output While everything looked rosy for a while, Nan’an faced economic slowdown during the financial crisis and has also been wrought with quality problems. In April 2010, the city announced a widespread crackdown on small companies manufacturing counterfeit plumbing goods that did not meet quality standards of the brands they were purporting to be made by. In retaliation, the city government methodically began to root out and shut down the illegal and small time factories. However, despite the shutdowns and crackdowns, the plumbing profits continue to grow along with the country’s economic development, rising standards of living and rural development. Tragedies such as the Sichuan and Qinghai earthquakes as well as international events like the Olympic Games and Shanghai Expo all demanded a huge influx in pipes. What Nan’an now faces is the international competition. While Nan’an products are used around China, international brands are still seen a having better standards. Whether companies like Nine Animal Husbandry can compete with the international brands by breaking into the global market is yet to be seen.
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FOCUS M&A
Big & Small
M&A and the Consequences on Procurement Departments
L
The following business case is purely theoretical / invented and should by no means be associated to any real existing life happenings.
et’s consider a story between a large company (BIG) and a small company (SMALL), who are both on similar business grounds. Let’s fix the parameter at “Marketing, Sales & R&D”, the recognized official engine for growth and profit, and let’s consider that “procurement” comes right after, as a second engine for growth & profit. BIG is looking for an external acquisition. They have a challenging situation in terms of top line growth and bottom line growth. In both cases, the procurement department holds some responsibility in dealing with these challenges, possibly because they are not transforming supplier relationship management into product innovation fast enough, nor are they finding the right levers to continue to deliver margin enhancement programs. Hence BIG needs an external acquisition In contrast, SMALL is able to deliver fast top and bottom line growth. This is also due in part to the procurement department, as they probably practice state of the art agility methods which include the agility to deliver profitable innovation and savings on a sustainable basis while optimizing the cost base. Hence, this is one of the reasons SMALL is being targeted Approach and Integrate In the approach phase, SMALL pulls out a defense plan aimed at doubling their savings rate, which is the best way to avoid having shareholders switching over to BIG’s offer. That puts pressure on the procurement department which is living through a oncein-a-life time adventures; they are going into the battle to resist the invader while still investing all their energy into a short term “live or die “ story.
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After the take over becomes reality, pressure stays strong as ever. BIG has to demonstrate that while both base businesses are being secured, all defense plan savings are still being transformed according to plan. The last thing you want is to have shareholders tell you they are disappointed that the merger did not perform as well as SMALL claimed it would. Meanwhile, both procurement organizations are working to understand each others organizational design, ways of working, market intelligence and price performance. Obvious synergies need to be found on rate card alignment, volume leveraged improved prices, common tenders, specification rationalization, and other consolidation activities; all while generating the original defense plan level of savings. As soon as the organizations start to integrate, the managers of SMALL will find excitement in discovering an enlarged scope and culture that comes from the newly combined company. The downside of this new integration is that the procurement office may find that company BIG makes a habit of segmenting roles and departments. This means the span of procurement influence within the company is smaller even though they are dealing with bigger spend management. Any sort of decision also takes longer consideration time as the number of stakeholders that the procurement team needs to convince is bigger. As a leader of the company, it is important to make sure frustration doesn’t start to build on all levels of management and that you retain talent after the excitement phase dies down. This is especially true during the structure integration phase where you need to act swiftly to place your best talents in the best roles.
Extended Uncertainty World class procurement is harder to embed in mega size companies like BIG than in middle size blue chip companies; which makes SMALL attractive. The agility of small companies enable them to explore a wider variety of procurement levels, work more in cross functional teams, and balance their agenda better between innovation, risk management and margin enhancement. Nevertheless, an even bigger company is still bound to find the right model for continued growth, avoid the downsides of a big organization and becomes a showcase for effective organizational design in high-complexity, high-spend environments. The full integration will likely take two to three years, according to the flexibility of your country’s legislation. This time will be necessary for the new organization to recover from times of uncertainty, but the pressure for improved delivery will keep them busy and create a wonderful adventure. However, three years is also just about the right time for another external acquisition if the company has not grown at the shareholder’s expected rate from an internal/ endemic top line growth perspective. This is a dangerous prospect, and even though the combined company opens up eras of marketing products, it is important not to fall into a never ending, ever faster, vicious circle of external acquisition which brings its load of downsides. It is also important to re-emphasize the need for procurement departments and other support functions to better balance their agenda towards partnerships for innovation with their suppliers to look for the next generation levers of internal top line sustainable profitable growth, the recipe for virtuous circle of growth.
Herve Le Faou is the Regional Procurement Director of company “SMALL.”
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SPONSORED Feature
Central Thinking
T
Implementing Chinese domestic shared procurement
service centers
he adoption of centralized shared services has become increasingly popular over the past few years in Mainland China. Many multinationals and, increasingly, domestic conglomerates are looking to this organizational setup as a way to improve process efficiency, improve transparency, and increase operational control. At the most basic level, a shared service centre (SSC) is a centralized department that services multiple business units. While the majority of back-office operations that have seen a degree of successful shared services are Accounting, Finance, IT, and HR, what is lagging are the Supply Chain functions – Sales Order Processing, Procurement, and Logistics. These functions are behind in the degree to which companies are able to setup internal shared service facilities. In this article we explore the state of shared services specifically in domestic procurement within the mainland, identify some of the challenges faced by companies in implementing such business models, and finally summarize some of the key success factors to make this a workable business model. Current Market Decentralized operational models with multiple operating entities, each with their own back office function are commonplace in China for a number of reasons. For multinationals this is often a result of needing to have multiple joint ventures, overseas acquisitions generating multiple entities, or as a result of them looking at establishing operations in geographically dispersed locations to be able to obtain tax or other benefits from doing so. For instance, Siemens, a large multinational conglomerate with over US$ 80billion in revenue, operates with over 80 separate operating entities on
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the mainland. Akzo Nobel, a Dutch chemical conglomerate with US$ 15billion in global sales, has around 30 operating companies in China.l Under the “Zhenqi Fenkai” policy (“Separating government from enterprises”) which lasted from 1982 to the mid-90s state-owned enterprises were driven to decentralized operating models. A key part of the reformation concentrated on giving the SOE increased autonomy with administrative control being decentralized to local governments. This resulted in many operating entities being setup that work independently
Decentralized operational models are commonplace in China, and most companies have several separate operating companies with the country. of each other, many of which sought to maximize the social benefit of employment rather than operating with a strong focus of operational back office efficiency. Even entrepreneurial companies that have emerged over the last decade, operate in relatively complicated operating structures as a result of a need to service local markets effi-
ciently, and in order to maximize tax benefits and city/county level policies for the establishment of new companies. Challenges While shared services organizations should generally be in a position to improve service levels within, they often fail to do so. Interestingly, technical issues tend to be easier to handle than people issues. The biggest challenges tend to be around change management, communication, and strategy. One of the biggest hurdles is a result of the “But I’m Different” syndrome. Most business units fear relinquishing control of their operations and arguing argue that a one-size-fits-all solution will not meet their needs and that a disruption in delivery of products or services will result in slowdowns or even stoppages of manufacturing processes or work. Thus they would prefer to trade off low labour costs for the ability to establish operational control. However, with the right executive sponsorship from an implementation program, Business Units soon realize the benefits of process simplicity and standardization, and thus become more comfortable with the elimination of what were previously considered essential process variations. Recruiting and developing a shared service organization can also prove challenging. The competition for labour is fierce with few procurement professionals used to working in a shared service procurement environment. Developing career roadmaps that separate out the development of transactional procure-to-pay processes to more strategic buying roles, is critical in managing employee turnover. Developing an operating model that is simple and robust enough to manage a critical level of process stability is crucial. Being able to recruit, train, and man-
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SPONSORED Feature age buyers should be a core competence of a shared service centre. Defining pricing and financing structures can also prove to be difficult. Typically, organizations choose a system of chargeback, based on utilization or allocations, which distributes costs among the business units. A complaint of insufficient representation is quite common, which often puts the shared service centre on the defensive about the value it’s bringing to the organization. Establishing and concurring on the most appropriate model within the business groups is a crucial step in the design phase when looking at the cost-benefit justification of a shared service centre, with the ultimate customers of the services – the Business Units – needing to be involved in the decision process. Key Success Factors The critical step in the establishment of shared services in procurement is the division of purchasing activities into operational or transactional activities, i.e. placing purchase orders and ensuring deliveries are on-time, versus the strategic buying requirements which look at demand consolidation, running tenders, and reviewing and developing suppliers. This separation is crucial to ensure that the strategic focus needed to obtain cost savings and manage suppliers is not interrupted by day-to-day problems. Establishing a shared service procurement organization involves developing an organization that is seen as a customerfocused vendor of choice rather than a mandated procurement organization. A good place to start is with indirect materials since the business impact of any supplier problems, such as delivery delays, is not as critical as with production materials required in customer product. Limiting choice also tends to be a quick way to lower customer satisfaction levels. While it is often tempting to try to drive volume-based savings by limiting product and vendor selection, the critical focus of a shared service procurement organization should be to ensure the inclusion of other key criteria such as quality, delivery times, and intangibles such as design services.
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Maverick buying, or the purchase of items not through the standard process but in ad-hoc manner, should be reduced, but it is important to note that it is difficult to eliminate completely. Flexibility should be built into the procurement process to take into account that it is difficult for any organization to control for 100% of its purchases, but necessary controls should be implemented to ensure awareness of what is being purchased in this manner so that the necessary actions to reduce such instances can be performed by the purchasing organization. Finally, it is imperative for a shared service procurement organization to measure costs and service levels before implementation. Often, the priority is to get the processes to work effectively. Additionally, with the go-live of a procurement organization fire-fighting can become an imperative if orders do not get processed on time or suppliers do not deliver. However, it is important from the start that the shared service organization defines KPIs in order to demonstrate value and procurement savings. Internal clients are often quick to criticize performance and demand higher levels of service, but clients should also understand what the baseline is and the length of time needed for the SSC to reach its ideal performance level. Slow but Focused Shared service centres have transitioned from being viewed as a pure transaction processing organization towards a value-provider to the business. As a result of being able to consolidate metrics, generate analytics, and aggregate business information, they have helped management focus on operations. While Procurement has been much slower to consolidate into a shared service concept, by focusing in on being serviceoriented and customer driven, certain aspects of an organization’s buying can be consolidated. Ryan Dourado PwC is a partner at PricewaterhouseCoopers. Based in Shanghai, he consults on customs, trade and supply chain issues.
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EXECUTIVE Appointments
Executive Appointments
With talent at a premium, CHaINA keeps an eye on which executives are moving where.
Oscar Perez, Head of Supply Rice ICS, APAC at Syngenta Mr. Perez is now based in Singapore and responsible for setting up new supply chains across Asia Pacific for a newly created business unit, ICS Rice. This is essentially a start-up where he is accountable for establishing and leading all aspects of the physical and the information supply chains. Oscar moves to Rice ICS from Syngenta, where he ran the Australasia supply for two years and led the integration of their supply chain. Previously, Oscar was a Senior Manager at Capgemini where he was responsible for sales and delivery working predominantly in the chemicals and life sciences industry.
Benoist Gargaud Global Freight & Logistics Purchasing Manager Groupe Casino Mr Gargaud is currently based at Casino’s Global Sourcing headquarters in Hong Kong, where he works on the delivering logistics and purchasing solutions for the group’s 11,000 supermarkets in Europe, South America, Indian Ocean and South East Asia. He previously worked as a consultant in Operations Management, Supply Chain & Logistics, reporting to CEO/ Board level of major corporations such as Michelin, GSK, EADS and Hachette Distribution Services. He has experience developing key accounts and reshaping operations, processes and positioning for further growth and commercial development in new markets and value-added services.
Aymeric Chandavoine, Director, Consumer & Retail CEVA Logistics, Asia-Pacific Mr. Chandavoine has been appointed Consumer & Retail Director CEVA Logistics, Asia Pacific. His focus on this sector is to further develop CEVA’s capability in the 12 countries of the Asia-Pacific and embedding operations excellence into customer solutions . Over his 12 years experience in the Supply Chain Management industry, Aymeric has held a variety of Operations and Business Development roles in an international environment (Central Europe and Asia). In his previous role at FM Logistic, he was responsible for the start up of their FMCG Business in China. He has Master degrees in engineering (Ecole Centrale LilleFrance) and in business administration.”
Philip Clarke Chief Executive Tesco (position begins March 2011)
Lee Finney Supply Chain Director Molson Coors
Mark Ferrio Strategic Sourcing Manager A.P. Moller - Maersk Group.
Phillip Clarke was named next in line after current Tesco head Sir Terry Leahy announced plans to retire. Clarke first worked for Tesco stacking shelves part-time in 1974 and has been with the company every since, taking on positions as store manager, buyer, marketer and international executive. He joined the Tesco board in 1998, taking supply chain functions for all stores. In 2003, he took charge of international operations in Asia and Europe - which now covers nearly 2000 stores. He also led expansion into some of the group’s key new markets such as China, India and Turkey.
Lee Finney is the new supply chain director of Molson Coors, one of the largest beer brewing companies in the world and host to brands like Coors, Blue Moon and Keystone. Finney joins the company from Goodman Felder, the largest listed food company in Australasia. In his new role, Finney will be reporting to Molson Coors Chief Executive Mark Hunter. Finney says his biggest challenge is to use the supply chain to remain competitive by being efficient and world-class in their manufacturing and logistics capabilities.
Mark Ferrio was appointed strategic sourcing manager of A.P. Moller-Maersk Group, one of the worlds largest shipping groups. He is based in Shanghai. Ferrio comes to A.P. from Just Luxe, where he was also the strategic sourcing/marketing manager focused on luxury and fashion goods. Ferrio has done business is 23 countries world wide and has broad experience with Chinese industry, multi-modal ISO-Tank Chemical Logistics and 3PL functions. Ferrio has a BA in supply chain management from Michigan State University.
Changed jobs in the past month? Hired someone new recently? comment@supplychain.cn www.supplychains.com
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LIFE Book Review
D
an Steinbock recently published his book Winning Across Global Markets with the rather strong subtitle “How Nokia Creates Strategic Advantage in a Fast Changing World.” The book is less a story but more a case study that analyzes how Nokia went from being a local Finnish forestry company in the 1900’s and morphed into the globalized and diverse company that it is today. While this book reads rather a project monitored very carefully by the CEO’s and PR managers of Nokia, there are some interesting take home points to be found in Steinbock’s book for other businesses and supply chains. First off, he emphasizes the structure of the company, where the supply chain manager works directly with the CEO and the company was, as a result, able to remain flexible and redefine itself with the changing market demands and ever widening trends of globalization. However, in a recent lunch with the author (held by the Global Supply Chain Council), many expressed doubt that Nokia is really as dynamic as Steinbock says it is. One supply chain manager said that Nokia is known as a “dead on delivery” company because it seems that they have already reached a plateau in their business development. “Nokia was riding high in the 1990’s,” said another manager. “The fact that Nokia has not been able to break into markets like the United States makes us think Nokia doesn’t have what it takes to ever expand.” Another participant noted that Nokia lacks the same consumer loyalty as enjoyed by other name brands. “The company is known for making box phones,” said one participant. “They have a big market share among first cell phone buyers but once people have enough money they ditch their Nokia.” Concerns about the company also lead into a discussion of their technology innovation. Nokia has a smart phone but it hasn’t been getting a lot of publicity or selling very well. One man held his Nokia smartphone
up during the roundtable discussion. “I have a Nokia smart phone because our company is Finnish,” he declared. “I would gladly burn it and get a Blackberry or iPhone.” It seems that while many admire the simplicity and user-accessibility of Nokia’s lower end phones, it company loses points the more complicated it tries to get. While a lot of questions were raised as to Nokia’s viability, others were convinced that Nokia still has the power to compete with other brands that have a sexier image. Steinbock acknowledged that Nokia will have to redefine its image to break into the smart phone market, but he also voiced complete confidence that it can do so. In both his book and during the luncheon, he said that the beauty and uniqueness of Nokia is that they are completely dependent and engrained in the global market, which forces them to constantly monitor the pulse of global demands. It also means that instead of having one scale of products, such as Apple which caters to higher-end consumers, Nokia relies on multiple tiers of products with multiple pricing scales. Another participant mentioned that while Nokia may not have the heart of United States tech-heads, it does have something that is perhaps more important; user accessibility, good relationships with their manufacturers and a very close knit In terms of brand loyalty, some mentioned that Nokia doesn’t have a strong figurehead and has less ability to market and pique the public. “Nokia doesn’t have a Steve Jobs,” said Steinbock. “But they don’t want one.” Steinbock says that the reliability of the product and strength of the company could be enough. According to another observer, Nokia has also focused on key growth markets like China and India, where the number of cell phone users is growing much faster than in more developed markets. Companies like Apple have historically focused on the needs of their users in the United States, and while currently that where many of the big tech heads are, that demographic is changing and companies better be ready.
Winning Across Global Markets? How Nokia Creates Strategic Advantage in a Fast Changing World.
Dan Steinbock is the research director of international business in the India, China, and America (ICA) Institute, which is working to foster knowledge on the rise of China and India and their impact on global markets. He divides his time among New York City, Shanghai, and Helsinki.
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LIFE Event
Liability Games
W
hen something goes wrong with a product and it’s your company logo at stake, their needs to be a clear structure set up to tell who is liable for damages and blame. When setting up partnerships with suppliers in China, professionals know that this action should be one of their number one priorities. It is also one of the most difficult contracts to ensure, as was clear by the multitudes of questions at a recent “Product Liabilities” breakfast held by the Global Supply Chain Council at Mi Thai. “You can never be too careful,” said Willi Vett, Partner and Head of Shanghai office at the Beiten Burkhardt International Law Firm. “Don’t ever forget how a company got sued after they put a cat in the microwave and it died…the customer said no one told them they shouldn’t put live animals inside the microwave.” Less extreme examples have to do with the costs of recalls, insurance coverage and direct product quality claims. Manufacturers have strict liability in terms of end products, and they are liable for defects and loss of cause for the defects regardless of how it arose. Vett says that there has been a change of burden of proof of the cut of the manufacturer. However, sellers and importers have a less clear role in terms of liability in China
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as they are only liable if it can be proved that they did something wrong themselves. This means that it must be proven that the buyer/seller know that the product was defective, which falls under a component of negligence. Most dangerous for buyers is if they cannot show directly where a product came from. Vett also mentions that in terms of counterfeit products, the burden of proof is changing. Vett cited a BMW case that was published by the higher courts. The plaintiff bought a BMW that was completely counterfeit, and when the car broke down it caused damaged. The buyer went back to their BMW dealer, and tried to sue. “If BMW didn’t have a very extensive responsibility contract in place they would have been liable,” continued Vett. “If you allow someone else to use your brand, then you also have to check that the quality is in order, or else you might become liable yourself – in terms of OEM manufacturing, if you put your label on it, you are liable for the product.” Wilhelm Baumeister, QA Management, Sandvik Mining & Construction, says that one of his biggest challenges in ensuring proper liability understanding and management is that his company implements standards according to the ISO-9001 booklet
which means that he is able to string all of the standards together and make them traceable, which means Sanvik can prove “this worker has done this task to this procedure on this day with this machine.” Because this is a global contract, the language is in English. “Our Chinese suppliers do not necessarily speak English,” Baumeister continued. “They often say right away – okay, where do I sign – this makes my hair go up because I have to enforce the contract once it has been signed.” Another participant voiced the fact that Chinese manufacturers are also a challenge in terms of liability because you need to ensure that the workforce has been trained to the correct standards and afterwards stay updated and in a position to qualify and improve their work. “I want to know how you handle this in your company,” the participant addressed the audience. “There are certain procedures we give, we want to see them followed and we need to see their documentation but it’s hard to get it.” “You offload responsibility to your supplier as much as possible,” Baumeister answered. “But in the end we are still liable – if one of our machines stands still for one day it costs 5 million dollars in loss of income and what follows are multiple damages and a long triangle of claims; so we are trying to do our best to offload this as far as we can.”
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CLASSIFIED Listings
LOGISTICS SERVICES
LOGISTICS SERVICES
4SCM A10, 5/F, 61 Old Warehouse Building, 61 Yangshupu Road, Shanghai 200082 上海市杨树浦路61号老栈商务楼5楼A10室 邮编200082 +86 (21) 6148 9800 www.4scm.com.cn
Deret Logistics Asia Suite 1703 Shanghai Bund International Tower, 99 Huangpu Road, Shanghai 200080 上海市黄浦路99号上海滩国际大厦 1703室，邮编：200080 +86 (21) 6306 2592 www.trans-access.com.cn
Agility 20/F Broadway Centre, 93 Kwai Fuk Road, Kwai Chung, NT, Hong Kong, China 香港新界葵涌葵福路93号 百汇中心20楼 +852 2211 8721 www.agilitylogistics.com www.alls-sh.com
DHL Exel Supply Chain 3398, Xiupu Road, Shanghai 201315 上海市秀浦路3398号， 邮编: 201315 +86 (21) 3825 6288 www.dhl.com
5/F Raffles City Office Tower, 268 Middle Xizang Road, Shanghai 200001 上海西藏中路268号
来福士办公楼5楼 邮编：200001
+86 (21) 2301 2800 www.apllogistics.com Arvato Services B-1/F XingHong Science & Technology Industrial Park, Feng Huang Gang Village, Xi Xiang, Bao’an District, Shenzhen 200231 深圳宝安区，宝安西乡前进二路凤凰岗村 星宏科技园，邮编：518102 +86 (755) 3386 1666 www.arvatoservices.com.cn BDP International Unit 2101-2110, Shanghai Bund Int’l Tower, 99 Huangpu Road, Shanghai 200080 上海市虹口区黄浦路99号上海滩国际大厦 2101-2110室，邮编：200080 +86 (21) 6364 9336 www.bdpinternational.com Ceva Logistics 19/F, Jiang Nan Shipyard Building 600 Luban Road, Shanghai 200023 上海鲁班路600号江南造船大厦19楼 +86 (21) 5302 9988 www.cevalogistics.com Clasquin Room 203, Qingke Mansion, 138 Fen yang Road, Shanghai 200031 上海市汾阳路203号轻科大厦138室， 邮编：200031 +86 (21) 6445 1452 www.clasquin.com Damco 5/F, Tian An Centre, 338 West Nanjing Road, Shanghai 200003 上海黄浦区南京西路338号天安中心24楼， 邮编：200003 +86 (21) 2306 2000 www.damco.com
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DSV Logistics 38/F, 1 Grand Gateway, 1 Hongqiao Road, Shanghai 200030 +86 (21) 5406 9800 www.dsv.com www.dsv.com/cn DTW Logistics Group 16 Tianzhu Middle Road, Zone A, Tianzhu Airport Industrial Area, Shunyi District, Beijing 101312 北京市顺义区天竺空港开发区A区天柱中路 16号，邮编101312 +86 (10) 5923 7777 www.dtw.com.cn Duisport Packing Logistics A, 8/F Shanghai Industrial Bldg, 18 North Caoxi Road, Shanghai 200030 上海漕溪北路18号上实大厦8楼A座， 邮编200030 +86 (21) 6427 2906 www.duisport-packing-logistics.com Elee 375, Kefu Road, Nanxiang Town, Jiading District, Shanghai 上海嘉定区南翔镇科福路375号 +86 (21) 3912 4360 www.eleechina.com
FM Logistic 3 West Guangzhou Road, Taicang EDZ Jiangsu Province.
江苏省太仓市经济开发区 广州西路3号 主楼8楼，邮编：201103 +86 (512) 8889 8666 www.fmlogistic.com Geodis 3/F. OOCL Plaza, 841 Middle Yan’an Road, Shanghai 200040 上海市静安区延安中路841号 东方海外大厦3楼，邮编200040 +86 (21) 6193 2323 www.geodis.com H & T International Transportation 5/F, China Merchandise Building 152-155 Connaught Road Central, Hong Kong
LOGISTICS SERVICES +852 2543 0708 http://www.hthkg.com.hk Havi Logistics 6 Xingsheng Jie, Beijing Economic & Technological Development Area, Beijing 100176 北京经济技术开发区兴盛街6号， 邮编：100176 +86 (10) 6788 3335 www.havi-logisitics.asia Hercules Logistics Unit 5A, Bldg. A, Shenfubao Hightech Park, No. 3, Huanghuai Road., Futian Free Trade Zone, Shenzhen, Guangdong 518038 广东省深圳市福田保税区， 黄槐道3号深福保科技工业园A栋5A， 邮编518038 +86 (755) 8358 0000 www.hercules-logistics.com ID Logistics Room 19D, Dong Tai Plaza, 309 Tanggu Road, Shanghai 上海市塘沽路309号19D +86 (21) 6306 7083 www.id-logistics.com
8/F Tower Block, LiFung Plaza 2000 Yishan Road, Shanghai 201103
上海市闵行区宜山路 2000号利丰广场 主楼8楼，邮编：201103 +86 (21) 2416 4700 www.idslogistics.com Kuehne & Nagel Block 1, 11-16F, 1868 Gong He Xin Road, Shanghai 200072 上海共和新路1868号大宁国际商业广场 第一幢11-16楼，邮编：200072 +86 (21) 2602 8000 www.kuehne-nagel.com Linfox Road Transport 26-F, Cross Region Plaza, 899 Ling Ling Road, Xuhui District, Shanghai 200030 上海市徐汇区零陵路899号飞洲国际广场26 楼F座，邮编：200030 +86 (21) 5150 6699 www.linfox.com Linghua Logistics 333 Ke Yuan Road Zhangjiang HiTech Park Pudong New Area, Shanghai 201203 上海市浦东新区张江高科技园区科苑路333 号，邮编201203 +86 (21) 5080 0107 Linkstar Logistics 49A, 199 North Riying Road, Waigaoqiao Free Trade Zone, Shanghai 200131 上海市外高桥保税区日樱北路199号49A, 邮编：200131 +86 (21) 5046 1865 www.linkstarlogistics.com
LOGISTICS SERVICES Logisfashion Transportation Tower, Room 1101 218, Hengfeng Road, Shanghai 上海市现代交通大厦恒丰路218号1101室 +86 (21) 5180 1781 www.logisfashion.com Logwin 5/F & 6/F, Ocean Towers, 550 East Yan’an Road, Shanghai 200001 上海市延安东路550号海洋大厦5楼和6楼， 邮编：200001 +86 (21) 2326 2000 www.logwin-logistics.com
13/F Tower, Golden Eagle Mansion, 1518 Min Sheng Road, Shanghai 200135
上海浦东新区 民生路1518号 金鹰大厦A座13楼 +86 (21) 6160 1198 www.menloworld.com Nowaday Rational Logistics 685 Huadan Road Qingpu District Shanghai 201708 上海市青浦区华丹路685号， 邮编201708 +86 (21) 5155 6226 www.heli56.com Penske Logistics Room 1801, Honi International Building, 233 Weihai Road, Shanghai 200030 上海威海路233号恒利国际大厦1801室， 邮编：200041 +86 (21) 6227 8566 www.penskelogistics.com P.G. Logistics Group 4/F, Baogong Building, 361 East Longkou Road, Tianhe district, Guangzhou 广州市天河区龙口东路361号宝供大厦四楼 +86 (20) 3848 2090 www.pgl-world.com Schneider Logistics UC Tower,Suite 1605, 500 Fu Shan Road, Shanghai 上海浦东福山路500号城建国际中心1605室 +86 (21) 5058 7970 www.schneider.com SDV International Logitics 20/F, East Building, New Hualian Mansion, 755 Middle Huai Hai Road Shanghai 200020 上海市淮海中路755号新华联大厦东楼20 楼，邮编：200020 +86 (21) 3395 0600 www.sdvchina.com SunJet Freight Express 299 Huaxiang Road, Shanghai 上海华翔路299号 +86 (21) 6127 2637 www.sunjex.com
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CLASSIFIED Listings
LOGISTICS SERVICES Toll 18/F, Times Plaza, 1 Taizi Road, Shekou, Shenzhen 518067 深圳蛇口太予路1号新时代广场1801室， 邮编：518067 +86 (755) 2681 9188 www.st-anda.com Werner Global Logistics 5/F South Harbour Building, 1 Fenghe Road, Shanghai 上海市浦东新区丰和路1号港务大厦南5楼 +86 (21) 3887 9520 www.werner.com Yatfai Logistics 39-H, Fortune Building, 88 Fuhua San Road Futian District, Shenzhen, Guangdong Province 广东省深圳市福田区福华三路88号， 财富大厦39楼H座 +86 (755) 3336 6898 www.yatfai.com YRC Logistics 8F, Building 2#, Xinda Commercial Building, 1158 Xiehe Road, Shanghai 200335 上海协和路1158号鑫达商务楼2号楼8楼， 邮编：200335 +86 (21) 6137 7668 www.yrclogistics.com PROFESSIONAL SERVICES Accenture 30/F, Central Plaza, 381 Huaihai Road, Shanghai 200020 上海市淮海中路381号中环广场30楼， 邮编：200020 +86 (21) 2305 3333 www.accenture.cn Araia Shanghai Times Square Suite 1709, 93 Middle Huai Hai Zhong Road, Shanghai 200021 上海市淮海中路93号大上海时代广场办公 楼1709室，邮编：200021 +86 (21) 6391 8356 www.araia.com Arvato Services 20/F, Cloud Nine Tower, 1018 Changning Road, Shanghai 200042 上海市长宁路1018号龙之梦大厦20层， 邮编：200042 +86 (21) 6161 1866 www.arvatoservices.com.cn Baker & McKenzine Suite 3401 China World Tower 2 China World Trade Center, 1 Jianguomenwai Dajie, Beijing 100004 +86 (10) 6535 3800 www.bakernet.com Barkawi A 705,69 Dong fang Road, Eton Place, Pudong New District, Shanghai 200120 上海市浦东新区东方路裕景国际商务广场 A705室，邮编：200120 +86 21 6859 9686 www.barkawi.com BBK Consulting 17/F Lippo Plaza, 222 Middle Huaihai Road, Shanghai 上海市淮海中路222号力宝广场17楼 +86 (21) 5396 5600 www.e-bbk.com
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PROFESSIONAL SERVICES
PROFESSIONAL SERVICES 上海市湖滨路222号，企业天地1号楼2501 室，邮编：200041 +86 (21) 6256 7333 www.kornferryasia.com
Suite 1001 East Tower China Merchants Plaza, 333 North Chengdu Road, Shanghai 200041
上海市成都北路333号 招商局广场东楼1001室， 邮编：200041 +86 (21) 5298 1800 www.control-risks.com Demand Management Systems PO Box 6180, Norwest Business Park, Baulkham Hills BC NSW 2153 +612 9659 4555 Dragon Sourcing Suite 1502, Jin Tian Di International Mansions 998, Renmin Road Shanghai 200021 上海市人民路998号今天地国际大厦 1502室，邮编：20002 +86 21 61413955 www.dragonsourcing.com easySOURCING easySOURCING Hong Kong www.easy-sourcing.com ET2C International 23 Wangjiao Plaza, 175 East Yan’an Road, Shanghai 200001 上海黄浦区延安东路175号旺角大厦23楼， 邮编：200002 +86 21 5308 1220 www.et2cint.com
KLB Group Room 2205, Universal Mansion Building, 172 Yuyuan Road, Shanghai 200040 上海愚园路172号世界环球大厦2205室， 邮编：200040 +86 (21) 62480735 www.klb-group.com Lloyd’s Register Asia 20/F Ocean Towers, 550 East Yan’an Road, Shanghai 200001 上海市延安东路550号海洋大厦20楼， 邮编：2000012 +86 (21) 5158 5700 www.lr.org www.lloydsregisterasia.com Logistics Executive Suite 13G, Shanghai Ind’l Investment Bldg. 18 North Caoxi Road, Shanghai 200030 上海市徐汇区漕溪北路18号， 上海实业大厦13楼G座，邮编：200030 +86 (21) 6427 6697 www.logisticsrecruitment.com.cn LowendalMasai 1505 Hai Tong Tower, 689 Guangdong Road, Shanghai 200001 上海市黄浦区广东路689号 海通证券大厦1505室，邮编：200001 +86 (21) 6341 1255 www.lowendalmasaichina.cn Michael Page International 601-603 Shanghai Kerry Centre 1515 West Nanjing Road, Shanghai 200040 上海南京西路1515号，嘉里中心601- 603 邮编：200040 +86 (21) 3222 4758 www.michaelpage.com.cn Poyry 802/8F, Tower One, Prosper Center, 5 Guanghua Road, Chaoyang District, Beijing 100027 北京市朝阳区东三环北路2号 南银大厦809室，邮编：100027 +86 (10) 6410 6550 www.poyry.com
27/F, Room 02 418-428 Jiang Ning Road 200041 Shanghai, China
上海市江宁路418-428号 27楼02室， 邮编：200041 +86 (21) 6217 0253 www.iiaps.org Ivie Asia Room 1507, You You International Plaza, 76 Pu Jian Road, Pu Dong New District, Shanghai 200127 上海市浦东新区浦建路76号由由国际 广场1507单元，邮编：200127 +86 (21) 6165 9100 www.ivieinc.com Korn/Ferry International Suit 2501, One Corporate Avenue 222 Hubin Road, Shanghai 200021
11/F PricewaterhouseCoopers Center, 202 Hu Bin Road, Shanghai 200021, China 上海市湖滨路202号 普华永道中心11楼， 邮编：200021
+86 (21) 2323 8888 www.pwccn.com Resources Global Professionals Room 2705-06, Lippo Plaza, 222 Middle Huaihai Road, Shanghai 200020 上海市卢湾区淮海中路222号
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67
CLASSIFIED Listings
PROFESSIONAL SERVICES 力宝广场2705-06室， 邮编：200020 +86 (21) 6386 8710 www.resourcesglobal.com Russell Reynolds Associates 4504, Jin Mao Tower, 88 Centure Avenue, Pudong, Shanghai 200121 上海浦东世纪大道88号金茂大厦4504， 邮编200121 +86 (21) 6163 0888 www.russellreynolds.com Smart Sourcing 1210-1213 Guo-Li Plaza, 1465 West Beijing Road, Shanghai 200040 上海市北京西路1465号 国立大厦1210-1213室， 邮编：200040 +86 (21) 5212 1200 www.smart-sourcing.com Tractus Asia Suite B, 22/F, Zhaofeng Universe Building, 1800 West Zhongshan Road, Shanghai 200235 上海中山西路1800号 兆丰环球大厦22楼B座， 邮编：200235 +86 (21) 6440 0990 www.tractus-asia.com World-Check Unit 4C, Times Plaza, 1, Taizi Road, Shekou, Shenzhen, 518067 深圳蛇口市太子路1号新时代广场4C座， 邮编518067 +86 (755) 2688 9786 www.world-check.com
REAL ESTATE SERVICES Global Logistic Properties Room 2708 Azia Center, 1233 Lujiazui Ring Road, Shanghai 200120 上海市陆家嘴环路1233号汇亚大厦2708 室，邮编：200120 +86 (21) 6105 3999 www.GLProp.com
2107 - 2109, Shui On Plaza, 333 Middle Huai Hai Road, Shanghai 200021 上海淮海中路333号 瑞安广场2107-2109室， 邮编：200021
+86 (21) 6133 2000 www.goodman.com GSE 27C Industry Building, 18 North Cao Xi Road, Shanghai 200030 上海市徐家汇漕溪北路18号 实业大厦27C,邮编：200030 +86 (21) 6090 1388 www.gsegroup.com
REAL ESTATE SERVICES AMB Property Suite 2908, Plaza 66 II, 1366 West Nanjing Road, Shanghai 200040 上海南京西路1366号 恒隆广场二座 2908单元， 邮编：200040 +86 (21) 6135 1688 www.amb.com Blogis International Logistics +86 (755) 2669 4211 www.blogis.com.cn CB Richard Ellis Suite 3201 K Wah Center, 1010 Middle Huaihai Road, Shanghai 200031 上海淮海中路1010号嘉华中心3201室， 邮编：200031 +86 (21) 2401 1200 www.cbre.com.cn Colliers International 16/F Hong Kong New World Tower, 300 Middle Huaihai Road, Shanghai 200021 上海淮海中路300号， 香港新世界大厦16楼， 邮编：200021 +86 (21) 6141 3688 www.colliers.com/china Gazeley Suite 805, Kerry Centre, 1515 West Nanjing Road, Shanghai 200040 上海市南京西路1515号嘉里中心805室， 邮编： 200040 +86 (21) 5298 6622 www.gazeley.com
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JULY/AUGUST 2010
25/F, Tower 2 Plaza 66 1366 West Nanjing Road Shanghai 200040 上海市南京西路1366号恒 隆广场2期25楼， 邮编：200040
+86 (21) 6393 3333 www.joneslanglasalle.com.cn Mapletree Suite A-D,14/F, Times Square Office Building, 500 Zhangyang Road, Pudong, Shanghai 200122 上海市浦东新区张扬路500号, 华润时代广场办公楼14楼ABCD单元， 邮编：200122 +86 (21) 5836 7177 www.mapletree.com.sg Vailog Room 702, City Gateway, 398 North Caoxi Road, Shanghai 200030 +86 (21) 6090 5292 www.realtyvailog.com Yupei Group Yupei Building, 2500 Jinchang Road, Shanghai 200331 上海市普陀区金昌路2500号宇培大厦， 邮编：200331 +86 (21) 6627 7577 www.yupeigroup.com
IT & SOFTWARE SOLUTIONS Apprise Software 6009 Changjiang Science Building 40 Nanchang Road, Nanjing 210037 江苏省南京市南昌路40号 长江科技园大厦6009室， 邮编：210037 +86 (25) 8345 5308 www.apprise.com
IT & SOFTWARE SOLUTIONS Manhattan Associates Software Unit 2110, 21/F, Shui On Plaza, 333 Middle Huaihai Road, Shanghai 200021 上海淮海中路333号瑞安广场21楼2110 室，邮编：200021 +86 (21) 6386 8800 www.manh.com
ATMS Number One, Holt Court, Aston Science Park, Birmingham, B7 4EJ, UK +44 121 628 9000 www.atmsplc.com
Seeburger Room 523-526, 5F, Cimic Tower, 800 Shangcheng Road, Shanghai 200120 上海浦东新区商城路800号 斯米克大厦5层523-526室, 邮编：200120 +86 (21) 5835 7779 www.seeburger.cn
Barloword Optimus 15/F NCI Tower, 12A Jianguomenwai Avenue, Chaoyang District Beijing 100022 北京市朝阳区建国门外大街甲12号新华保险 大厦15楼邮编，邮编：100022 +86 (10) 8523 3103 www.barloworldoptimus.com
Tradecard Room B, 23/F, Jinrun Mansion, 6109 Shennan Road, Futian District, Shenzhen 518040 深圳市福田区深南路6109号 金润大厦23楼B座，邮编：518040 +86 (755) 8830 9265 www.tradecard.com
BravoSolution 19F-08, Chinese Overseas Building, 129 West Yan’an Road, Shanghai 200040 上海市静安区延安西路129号华侨大厦 19楼08室，邮编：200040 +86 (21) 6145 8500 www.bravosolution.com DDS Logistics & Sourcing Software Suite 2605,26/F, Hong Kong Plaza, 283 Huaihai Road, Shanghai, 200021 上海市淮海路283号香港广场26楼2605室， 邮编：200021 +86 (21) 6103 5715 www.ddslogistics.com/cn Epicor Software 2008 Cross Tower, 318 Fuzhou Road Huangpu District, Shanghai 200001 上海市黄浦区福州路318号 高腾大厦2008单元，邮编：200001 +86 (21) 63912808 www.epicor.com GXS International Room 1602, 16/F, Grand Gateway Tower 1, 1 Hongqiao Road, Shanghai 200030 上海市虹桥路1号港汇广场1座1602室， 邮编：200030 +86 (21) 6120 1088 www.gxschina.com.cn
Suite 1515, Silver Centre, 1388 North Shanxi Road, Putuo District, Shanghai 200060 上海陕西北路1388号 银座中心1515室， 邮编：200060
+86 (21) 6149 8042 www.supplyon.com
EQUIPMENT PROVIDERS Anwood 3F-D4 Jiacheng Mansion, 128 Jinjihu Road, Suzhou 苏州市金鸡湖路128号加城大厦3F-D4 +86 (512) 6761 5558 www.anwood.com.cn
40/F, Suites 8-10, 2 Grand Gateway, 3 Hongqiao Road, Shanghai 200030 上海市虹桥路3号 港汇二座40楼08-10室 邮编：200030
+86 (21) 6127 2488 www.chep.com Dexion (Shanghai) Logistics Equipment 155, Zha Yin Road, Shanghai 200438 上海市闸殷路155号， 邮编 200438 +86 (21) 6505 0011 www.dexion.biz Loscam Packing Equipment Room 508, 707 ZhangYang Road, Pudong, Shanghai 200120 上海市浦东新区张扬路707号508室， 邮编：200120 +86 (21) 6104 8156 www.loscam.com Schoeller Arca Systems Unit 1111-1112, Shui On Plaza, 333 Middle Huaihai Road, Shanghai 上海淮海中路333号, 瑞安广场办公楼1111-1112室 +86 (21) 3133 2081 www.schoellerarcasystems.com
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COMPANYINDEX 361 ����������������������������������������������54 A.S. Watsons ���������������������������������9 Accenture ������������������������������������57 Adidas �����������������������������������54, 55 Aeon ����������������������������������������������9 Agility ���������������������������������������������8 Akzo Nobel ����������������������������������60 Al Dahra ����������������������������������������8 Alibaba ����������������������������������10, 15 Amazon ���������������������������������������15 Anta ���������������������������������������54, 55 Apple ������������������������� 26-29, 53, 64 Atlas Copco ���������������������������������12 B9 ������������������������������������������35, 36 Banana Republic �������������������19, 21 BASF �������������������������������������������41 Beiqi Foton Motor ��������������������������8 BMC ���������������������������������������������11 BMW ��������������������������������������12, 65 Borealis �����������������������������������������8 BP ������������������������������������������������41 Brilliant �����������������������������������������58 Broadcomm ���������������������������������28 Capgemini �����������������������������������63 CapitaMalls Asia ����������������������������9 CEVA Logistics �����������������42,46, 63 Changan ���������������������������������42,45 Charles River �������������������������������15 Chery International ����������������������12 Chrysler ���������������������������������������12 Chung-Yu ������������������������������������58 Cisco �������������������������������������������53 Clasquin ��������������������������������22, 24 Coach ������������������������������������������55 Compal ����������������������������������������26 Core Pacific Yamaichi ������������������55 Daimler AG ������������������������������������8 Dascher ���������������������������������42, 45 Dell ����������������������21, 26, 28, 29, 41 DHL �����������������������������������9, 40, 44 Dimerco ����������������������������38, 43,45 Donfang ���������������������������������42, 45 Dongxiang �����������������������������������54 Dragonomics �������������������������������29 EADS ������������������������������������������63 Exxon Mobil ����������������������������41,44 FAW Volkswagen ���������������������8, 42 Fiat ���������������������������������������������12 Flextronics �����������������������������26, 27 Flyjac Logistics ����������������������������15 FM Logistic ����������������������������������63 Ford ���������������������������������������12, 53 Foxconn ����������������������� 9, 26-32, 42 GAP ���������������������������������������19, 21 Gartner ����������������������������������56, 57 GE �����������������������������������������������53 Geely �������������������������������������12, 15 Geodis �����������������������������������38, 43 General Motors ����������������������������12 Goodman Felder �������������������������63 Google �����������������������������������������12 Groupe Casino ����������������������������63 GSK ���������������������������������������41, 63 H&M ���������������������������������������39, 46 Hachette ��������������������������������������63 Haier Group ���������������������������11, 12 Hang Seng Bank �������������������������15 Hanjin Shipping ���������������������35, 36 Heinz �������������������������������������������41 Hitachi �����������������������������������������15 Holder Group �������������22, 23, 24, 25 Honda ������������������������������������29, 30 Hongxing Sports ��������������������������54
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EVENTSCALENDAR HTC ���������������������������������������� 27 Huawei Technologies �������������� 12 IBM ����������������������������������� 29, 57 Infosys ������������������������������������ 57 Inventec ���������������������������� 26, 28 Jaguar Land Rover ����������������� 12 Jinjiang International ���������������11 Jiying Plastic ����������������������������� 6 Jollibee Foods ������������������������ 15 Jusco ���������������������������������������� 9 Just Luxe �������������������������������� 63 JWPL �������������������������������������� 15 Kangwei ���������������������������������� 54 Kappa ������������������������������� 54, 55 KONE ������������������������������� 16, 17 Kuehne + Nagel ���������� 39, 40, 44 Levillair Group ������������������� 22-25 LG ��������������������������������������������11 Li Ning ������������������������������ 54, 55 Linde ��������������������������������� 40, 44 LogisFashion �������� 39, 40, 44, 46 Logwin �������������������������������������� 9 Luka Koper ����������������� 39, 45, 47 M&M Transport ����������� 38, 41, 43 Maersk ������������������������������������ 63 MCIQ �������������������������������� 35, 36 Metro ���������������������������������������� 9 Michelin ���������������������������������� 63 Mitsui ���������������������������������������11 Molson Coors ������������������������� 63 Motorola ��������������������������������� 41 Nike ���������������������������������� 54, 55 Nine Animal ���������������������������� 58 Nippon Express ������������������������ 8 Nokia �������������������������������� 28, 64 NYK ���������������������������� 34, 35, 36 Old Navy ��������������������������� 19, 21 P&G ���������������������������������������� 21 Pacific Epoch �������������������������� 54 Panalpina ������������������������� 42, 45 Paul Bakery ����������������������� 22-25 Peak ��������������������������������� 54, 55 ProLogis ����������������������������������� 9 Puma �������������������������������������� 54 Qualcomm �������������������������������� 8 Quanta ������������������������������ 26, 30 Samsung �������������������������� 41, 44 Sandvik ����������������������������������� 65 Sinochem ������������������������������� 15 Sinodis ������������������������������ 22, 24 Sony ��������������������� 15, 26, 28, 29 SPAR ���������������������������������������11 Sun Tech Solar ����������������������� 12 Suning �������������������������������������11 Syngenta �������������������������������� 63 Taobao ������������������������������ 10, 55 Tata ����������������������������������������� 57 Tesco �������������������������������������� 63 Toshiba ����������������������������������� 28 Toyota ������������������������������������� 53 UBS ���������������������������������������� 55 Volume Group ������������ 38, 43, 46 Volvo ��������������������������������� 12, 15 Wallenius Wilhelmsen ������ 42, 45 Walmart ���������������������������������� 12 Wintek ������������������������������������ 27 Wipro �������������������������������������� 57 Wistron ����������������������������� 26, 30 WuXi PharmaTech ������������������ 15 Xtep ���������������������������������� 54, 55 Yat Fai ������������������������������ 39, 47 YCH ���������������������������������� 41, 44 Yuancheng Group �������������������11
2010 JUL
1
2
THU-FRI
2010 JUL
15
Asia Ship Recycling & SNP Summit 2010 Shanghai
JUL
15 18 THU-SAT
JUL
15
Venue:
Crowne Plaza Century Park Organizer:
CBI Events Cold Chain China Summit Shanghai Venue:
Renaissance Hotel Organizer:
The Council
THU
2010
2010
THU
2010 JUL
15 16
JUL
28 29 WED-THU
Venue:
Hongqiao Hotel Organizer:
European Union Chamber of Commerce Supplier Relationship Management Training Shanghai Venue:
Sliver Center Organizer:
The Council
THU-FRI
The 12th Shanghai International Machine Tool Fair Shanghai Venue:
Shanghai New International Expo Center Organizer:
2010 JUL
22 24 THU-FRI
Clinical Trials Supply China Beijing Venue:
Marriott Hotel West Organizer:
IQPC
The 104th use Articles Trade Fair& China Modern Home Expo Shanghai Venue:
Shanghai New International Expo Center Hall Organizer:
EASTPO International Holding
2010
Shanghai Innovation Conference 2010 Shanghai
CCAGM Exhibition
2010 AUG
1
20
SUN-FRI
2010 International Conference on Automation & Logistics Hongkong Venue:
The Chinese University of Hong Kong Organizer:
IEEE
2010 AUG
3
TUE
2010 AUG
11 14 WED-SAT
China Wage Conflict & Impact on HR & Supply Chain Shanghai Venue:
Osteria
Organizer:
The Council Shanghai International Auto Manufacturing Tech & Material Show Shanghai Venue:
Shanghai New International Expo Center
2010 AUG
10 12 TUE-THU
2010 AUG
18 WED
Henjing Exhibition Company
AUG
25 27 WED-FRI
2010 China Pharma Manufacturing&Supply Chain Management Summit Beijing Venue:
Swissôtel Hotel Organizer:
Duxes
Venue:
Beijing International Exhibition Center Organizer:
CILE2010 China (Beijing) China International Auto Supplies Sourcing Fair 2010 Shanghai Venue:
Shanghai Everbright Convention & Exhibition Center Organizer:
China Auto Fitting Industry Federation
Organizer:
2010
China Beijing International Logistics Exposition Beijing
2010 AUG
30 31
Shipping Finance China Summit 2010 Beijing Venue:
Swissôtel Beijing Organizer:
IQPC
MON-TUE
JULY/AUGUST 2010
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LIFE Mixer
MIXING IT UP
T
he Global Supply Chain Council’s bi-monthly mixer brings together 60 to 100 executives for an evening of leisurely drinks and chatter. This low-key event is a great opportunity to mingle with old friends and make new ones. For the Council’s May mixer, our events team decided on Cotton’s Bar, located on XinHua Rd in Shanghai. While the restaurant is a lovely and well lit renovated colonial house, it was the porch that held the evening guests captivated. As it is the Shanghai evenings that are the most bearable weather-wise during the summer months, it’s a relief to be able to relax, drink in hand, and
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network under the stars. Cotton’s on Xinhua is the second branch of the restaurant opened by entrepreneur and local personality Cotton Ding, who has another similar space on Anting Lu in the French Concession. The XinHua space, opened in 2009, has a more spacious interior and more open porch area. Subtle lights warm the area and a fountain burbles quietly in the background. Overall, one of the best places in Shanghai to relax with a cold drink on a warm night, providing that you are liberally doused with mosquito repel-
lent before sitting down. Conversations not only surrounded general pleasantries, but offered an opportunity for our guests to seek advice, discuss and even complain about their operations, procurement, logistics and supply chain professionals. The atmosphere wasn’t too serious though, as most people were there to have a little bit of fun. Look for our next mixer this summer. Price is RMB150/ members, RMB250/ non-member. Includes two free drinks and a light buffet.
www.supplychains.com
Conferences + Workshops + Expo
November 17-18, Shanghai
CHaINA ’10: The Global Supply Chain Event for China
Media Partners:
CHaINA’10 is the largest Supply Chain event in China involving a combination of presentations, networking, workshops and exhibitors followed by an exclusive gala dinner.
变化中的中国：提升价值 链，增加在全球经济中的竞 争力。
This must attend event is the ultimate opportunity for supply chain, procurement and logistics executives to learn from your peers from world's leading companies and make new bcontacts from the hundreds of professionals who will attend the event over the 2 days!
数以百计的同僚会参会，所 以今年是您扩大人际关系网 络，树立中国供应链领袖形 象的绝佳机会。
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www.supplychains.com