Supply Chain Digital – May 2020

M AY 2 0 2 0

www.supplychaindigital.com

: Special report

the Blockchain in supply chain

g n i m r o f s n a r T : G C B y l p p u S l Digita Chain Also inside: Procurement software vendors The digital evolution of 3PL services

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FOREWORD

W

elcome to the May edition

In this month’s special report,

of Supply Chain Digital!

we examine the introduction of

In our cover feature this month, we speak with Stefan Gstettner, Partner & Associate Director in the Frankfurt office of Boston Consulting Group, to discuss the impact of digitalisation

blockchain in the supply chain and look at what opportunities companies can leverage by adopting new technologies into their operations.

in the supply chain. “It goes without

In this edition’s Top 10, we count

saying that our clients expect us

down 10 of the leading procurement

to be at the forefront of market

software vendors worldwide.

developments – I would even argue, that’s not enough,” he affirms. “We aspire to shape trends in the supply chain space.”

Also inside this issue, we look at the transformation of digital procurement and examine how some of the biggest companies globally are redefining their procurement approach.

Elsewhere, we explore the digital

Also, don’t miss exclusive digital reports with Ninja Van, Pokka International and Motisun Group.

Would you like to be featured in the next edition of Supply Chain Digital? Get in touch at sean.galea-pace@bizclikmedia.com Enjoy the issue!

Sean Galea-Pace

evolution of 3PL services, as Coyote Logistics, UPS, Blue Yonder and EY discuss the changing expectations of the sector. www.supplychaindigital.com

03

Is supply chain the weakest link in your global strategy?

“EY” and “we” refer to all German member firms of Ernst & Young Global Limited, a UK company limited by guarantee. ED None. MUK 1903-246

Addressing an organization’s overarching end-toend supply chain and operations strategy to grow, optimize and protect their operations – no matter if local or global: EY provides the right answers as your leading integrated transformation partner in the digital age. www.ey.com/en_gl/supply-chain

Click the burger menu (top right) to return to contents page at anytime EDITOR-IN-CHIEF

Sean Galea–Pace EDITORAL DIRECTOR

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10 Ninja Van: preserving the startup spirit

20

58

Embracing digital in supply chain

The digital evolution of 3PL services

54

40 THE INTRODUCTION OF

BLOCKCHAIN IN THE SUPPLY CHAIN

68

84 Procurement Software Vendors

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102 Pokka

120 Motisun Group

10

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11

Ninja Van: preserving the startup spirit WRITTEN BY

WILLIAM SMITH

PRODUCED BY

CAROLINE WHITELEY

w w w. s up p l y c h ain digi t a l . c o m

N I N J A VA N

Vin Perez, COO, Philippines, discusses how Ninja Van is maintaining its position as the vanguard of ecommerce logistics in Southeast Asia

L 12

ogistics technology company Ninja Van is one of a number of high tech startups in Southeast Asia, a region ripe for

disruption. That’s precisely what attracted COO, Philippines, Vin Perez back to the region after studying for an MBA at Harvard Business School.

“There’s explosive growth happening here in Southeast Asia, following what happened in the West maybe 15 years ago and China 10 years ago.

Because of that, I was really quite keen on going back. I happened upon this opportunity at Ninja Van, where the company was really looking to establish the regional ecommerce logistics industry.”

While the region brings enormous opportunities, it also has its own challenges. “Ecommerce markets in the West develop straightforwardly. There’s existing infrastructure, there are regulations, technology is quite advanced. Customer adoption of ecommerce is therefore really direct. In Southeast Asia, the infrastructure is not as good. There are M AY 2 0 2 0

2014

Year founded

10,000 Number of employees

13

w w w. s up p l y c h ain digi t a l . c o m

N I N J A VA N

“ We believe in a virtuous cycle of technology helping us to be lean, which allows us to adapt new technologies that in turn allows us to become leaner, and so on” — Vin Perez, COO, Philippines, Ninja Van

a lot of logistical challenges to make sure that the parcels arrive on time.

Some of the challenges are to do with events like typhoons and the disruption they cause.” Overcoming such issues requires a certain flexibility. “We really have to be creative,” says Perez. “The percentage of the population that uses credit cards is very low, so a large chunk of our deliveries go through as what we call cash on delivery or COD. That’s not so common in the West, but it makes up more than 90% of our

14

deliveries here.”

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Ninja Van: On the Record with CEO Lai Chang Wen CLICK TO WATCH

|

3:04

15 Ninja Van’s success has also required the intelligent application of technology. “Trying to address the complicated last mile problem here in Southeast Asia starts with technology. We have a talented development team that constantly thinks about these problems and how we can address them. We use a lot of different proprietary technologies in our internal platform, which allows us to provide the quality of service we do.” It is thanks to technology that Ninja Van can take an evidence-based approach to the decisions it makes. “I’m a firm believer w w w. s up p l y c h ain digi t a l . c o m

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Hongkong SSG Limited

in data. It’s essential to understand

a certain culture and demographic to

how you’re performing, how the

be able to adapt to this kind of tech-

market is reacting and how we can

nology,” says Perez. “In order to have

be more proactive in addressing the

the objective in mind and to be able to

market’s needs. But working with data

reach it, it’s key that everyone is going

is easier said than done. A lot of it’s

for the same goal and has that com-

about making sure you have the right

mon purpose. More often than not, we

database tools and understanding

find the younger demographic to have

who has the ability to deal with such

the ability to operate in this environ-

an infrastructure. You have to adapt

ment.” That emphasis on youth led to

your organisation to be able to address,

new and unexpected solutions to logis-

handle and then really trust the data.”

tics issues. “Especially early on in our

Technology means little without the

tenure, we really looked into the young

proper culture in place, however. “We

problem solvers who may not have

discovered along the way that it takes

had the most experience in logistics,

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but were willing to explore different

we’d be stuck with an organisation una-

problems in order to solve logistics

ble to adapt. A startup has to always

problems in a very different way.”

be aware of where it is investing its

That startup spirit is not just present

resources, making sure that it doesn’t

in the younger members of the team,

grow wasteful. I think that’s essential,

however, having instead suffused the

and it feeds back into how we use

entire organisation from the very start,

technology. We believe that, because

as Perez explains: “Over the past sev-

of technology and how we deploy it,

eral years we’ve been growing more

we are able to scale while remaining

than 10-fold over the span of a year,

lean. We believe in a virtuous cycle of

and in certain periods even quicker.

technology helping us to be lean, which

If we hadn’t kept the team lean and

allows us to adapt new technologies

agile and willing to explore new ways

that in turn allows us to become leaner,

of serving our clients and operating,

and so on.”

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E XE CU T I VE PRO FI LE

Vin Perez Vin Perez graduated with a Bachelor of Science in Industrial Engineering from the University of the Philippines, and a Master of Business Administration from Harvard University. Prior to Ninja Van Philippines, he has acquired operations management experience as a Demand and Supply Planning Executive for Nestlé. His vision for Ninja Van Philippines is to connect every Filipino to the parcels and products they want one delightful delivery at a time. In his spare time, Vin plays basketball and is working to finish the latest role playing video game on his PlayStation.

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N I N J A VA N

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“ We really looked into the young problem solvers who may not have had the most experience in logistics, but were willing to explore different problems in order to solve logistics problems in a very different way” — Vin Perez, COO, Philippines, Ninja Van M AY 2 0 2 0

Ninja Van partners with some of the biggest ecommerce operators in the region in the form of Shopee and Lazada. “We have a mutually beneficial relationship with them, where we essentially serve their logistics needs.

So we integrate with their platforms, we speak the same language in terms of technology and customer experience, and that allows both parties to provide a solid experience.” The super app Grab is another key synergistic partner. “Grab offers many different services in many different areas, including delivery, and

19

that’s where Ninja Van comes in, provid-

of the big ticket items. Operationally,

ing delivery outside of the main metro

I see it just getting more and more opti-

areas,” Perez explains. “At the same

mised.” Such improvements are all in

time, we’re cognizant that a big chunk of

the service of improving the customer

business in the market is still happen-

experience. “At the end of the day, being

ing in the physical retail space. Smaller

able to provide a solid, reliable experi-

SMEs haven’t been well served - that’s

ence to the people who ship with us and

a very underserved part of the market

the people we deliver to is key.”

that we really want to serve a lot better.”

Going forwards, Perez still sees room for improvement, particularly when it comes to automation. “Right now we’re looking at fully automated facilities that can process parcels for us. That’s one w w w. s up p l y c h ain digi t a l . c o m

PROCUREMENT

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M AY 2 0 2 0

THE

TRANSFORMATION OF DIGITAL

WRITTEN BY

SEAN GALEA-PACE

PROCUREMENT

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PROCUREMENT

How is the digital procurement landscape transforming? Let’s find out

T

he role of procurement is transforming.

There are a number of key reasons why companies are choosing to adopt a digi-

tal procurement approach. These are centered around increasing efficiency by automating repeatable tasks and achieving significant cost savings. Digital procurement helps with day-today decision making and allows real-time visibility into all areas of the supply chain.

22

Here are several companies that are embracing digital procurement and leveraging it into operations.

ACCENTURE The multinational professional services company, Accenture, believes it shouldn’t be if companies choose digital procurement, but when. On Accenture’s website, it states: “The procurement organisation has largely been left behind in the digital revolution. This needs to change, fast.”

WHAT MAKES AN EFFECTIVE PROCUREMENT STRATEGY, ACCORDING TO ACCENTURE? Data - When data is sourced from both inside and outside, it allows the organisation to inform not just what was purchased and at what price but also why it was purchased too.

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You see a shipping terminal.

We see the missing container that will shut down production.

C3.ai transforms Manufacturing. Š 2020 C3.ai, Inc. All Rights Reserved. is a mark of C3.ai, Inc.

PROCUREMENT

Technology toolbox - Understanding

addition to an updated operating

data and providing advanced intelligent

model, to enable an understanding of

support requires the right technology,

the new responsibilities.

particularly AI, natural language proACCENTURE KEY PEOPLE

cessing, analytics and bots.

Intuitive user experience - Intuitive user experiences encourage stakeholders to use the online procurement tools.

Skills and talent - Achieving true value requires a cross-functional team of people from data scientists and AI

Kai Nowosel ­— Accenture’s CPO Ken White — Chicago Sean Mckeogh ­­­— NCR, Philippines Daan Koetsier — Brisbane

specialists, category experts as well as AI and design professionals.

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Policies and procedures - A review of policies and procedures is required, in

Business Chief: Breaking the mould in Procurement with Accenture CPO CLICK TO WATCH

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1:54

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PROCUREMENT

ACCENTURE’S THREE STEP CHANGE IN BUSINESS PROCESS DIGITISATION

to ensure that when a digital transfor-

Recording why decisions are made

mation is complete, a company isn’t

about transaction processing; the con-

behind the times. It is important to

text within an individual’s own universe

understand what problems are trying

of data.

to be solved through digital transfor-

Recording data and transactions

mation. Having an end goal or target in

through the use of eProcurement tech-

mind is vital.

nologies, digital process management.

Operate and interact with information outside your own data ecosystem; intelligent capabilities guide business decisions instead of transactions.

26

SELECTHUB SelectHub is a technology management solution that centralises all processes through an easy-to-use, intelligent platform. Offering built-in best practices and activity tracking for procurement, IT and finance, means organisations can achieve more successful IT initiatives faster.

A ROADMAP TO DIGITAL PROCUREMENT, ACCORDING TO SELECTHUB 1. Gather data from inside and outside sources. With any successful digital procurement strategy, it is M AY 2 0 2 0

essential to embrace the latest trends

2. Creating a vision of the future.

Imagine the role of procurement in five years time. How does your organisation’s procurement strategy fit into that? Discussing a clear plan with procurement executives at every company is key to understand what technology is required to achieve success.

SELECTHUB KEY PEOPLE

Venkat Devraj Steven Sowin Luis Hernando Blanco

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PROCUREMENT

3. Implement the vision. Upon completing preparation, it is time to introduce the strategy. By setting achievable goals, it will allow momentum to be built. Organisations should create a timeline to ensure they are achieving targets in a timely manner.

GEP GEP empowers global companies to operate more efficiently and effectively, gain competitive advantage, boost profitability and maximise value. Its uni28

fied approach to digital procurement transformation allows its clients to increasingly deploy the resources required to charge a high-performance digital procurement organisation.

The company recognises the true value of digital procurement and through GEP SMART, offers an industry-leading cloud-native, unified source-to-pay platform.

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G E P S M A R T P L AT F O R M

The GEP SMART platform is the company’s own end-to-end procurement technology platform which can be easily integrated with leading ERP and F&A systems, and makes state-of-the-art capabilities available to procurement professionals. It is a cloud-native, unified source-to-pay platform with comprehensive spend, sourcing and procurement functionality, which includes spend analysis, contract management, supplier management, procure-to-pay, savings project management and category management.

Through GEP SMART enterprise procurement teams can: • Identify opportunities, manage savings, make purchases and payments - all through a unified procurement platform.

• B oost adoption and drive enterprisewide compliance with intelligent, intuitive interfaces and user-centric design.

• Manage all source-to-pay processes on the go with a mobile-native design anytime, anywhere, any device.

• E nable fluid information, process and workflow to accelerate and optimise the end-to-end procurement process.

• Provide greater collaboration and synergy between procurement and finance teams.

• S tandardise field-tested, procurement process management best practices and workflows.

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PROCUREMENT

BCG’s Robert Tevelson on Procurement CLICK TO WATCH

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3:13

30

BCG KEY PEOPLE

Daniel Weise — Dusseldorf Wolfgang Schnellbacher Stuttgart Rafael Desi — Paris Robert Tevelson — Philadelphia ­­­

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BCG The management consulting com-

achieving 5-10% cost savings as well

pany, Boston Consulting Group

as experiencing a 30-50% increase

(BCG), believes that new technologies

in efficiency.

such as Big Data, artificial intelligence

allowing companies to better predict

BCG LISTS THREE KEY WAYS HOW DIGITAL CAN CREATE VALUE FOR PROCUREMENT:

and mitigate quality failures more

1. Insights and informed decisions

effectively than in the past.

- Big Data and advanced analytics

(AI) and advanced analytics provide a more defined degree of precision,

BCG estimates that those tech-

provide greater insights, improve

nologies can “reduce procurement

decision-making and performance.

quality problems by as much as

2. Automated processes - Robotic

60-70%�. It also believes that the

process automation (RPA) accel-

digital procurement journey can

erates transactional tasks whilst

produce significant results, such as

enhancing accuracy and contract compliance. Artificial intelligence (AI) can increase cognitive activities, as well as accelerate productivity.

3. Collaboration - Several digital technologies can work together to allow digital procurement to take place in real-time in collaboration with other business units within the organisation.

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PROCUREMENT

BAIN Bain’s report ‘Digital Procurement: The Benefits Go Far Beyond Efficiency’ explores how digital tools can enhance the efficiency and effectiveness of procurement, as well as playing a more strategic role in harnessing innovation and playing a significant part in an organisation’s digital approach.

IMPROVING PROCUREMENT EFFICIENCY AND EFFECTIVENESS • Automated and agile operations • Frictionless collaboration 32

• Smarter procurement • Getting started • Return on investment • Cross-functionality capability, readiness and alignment

operating model, partnerships and

• Technology requirements

talent and culture.

Procurement executives can play a more influential role in realising a

ENABLING THE COMPANY’S BROADER DIGITAL VISION

company’s digital vision, says Bain.

• Procuring solutions, not products

A digital-savvy procurement team

• Agile way of working

can empower companies to partner

• Talent of the future

faster with innovative suppliers, embrace new ways of working and

Bain’s research reveals that 80% of

lead change.

procurement professionals believe

Digital procurement teams can allow companies to rethink their M AY 2 0 2 0

they need to do more to take advantage of the latest digital tools. Bain

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BAIN KEY PEOPLE

believes that a good digital procurement strategy will allow for considerable cost savings to be achieved as well as freeing up capacity for more strategic activities.

CREATING A PROCUREMENT DIGITAL STRATEGY AND ROADMAP

Caperton Flood —New York David Schannon — Silicon Valley Chuck Miller — Boston Borja Tramazaygues ­­­— Madrid Gerry Mattios — Singapore

• Clean, high-quality data

Tessa Bysong — Chicago

• Agile operating model

Kelly Liu — Beijing

• Digital and entrepreneurial talent

Phil Barton — Sydney

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PROCUREMENT

PWC

• New procurement value proposition

In PwC’s report ‘Procurement 4.0: Are

• Digital category and service

you ready for the digital revolution?’, the company provides a framework for adapting to the organisational changes that the modern day procurement approach requires.

There are six key areas to the Strategy & Procurement 4.0 framework.

34

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procurement • Digital supply chain and supplier management • Innovative procurement data utilisation • Digital processes and tools • Organisation and capabilities

PWC KEY PEOPLE

Luke Sayers AM Warwick Hunt Adam Krason

“ In order to truly harness a digital first procurement strategy, it will require an agile mindset to reshape the procurement organisation�

35 The implementation of Procurement 4.0 will mean new value propositions developed, new business needs as well as the requirement to introduce data across functions and value chains.

In order to truly harness a digital first procurement strategy, it will require an agile mindset to reshape the procurement organisation and embrace new opportunities amidst the digital revolution.

DELOITTE The consulting giant, Deloitte, has observed the new capabilities that w w w.suppl yc ha i ndi gi ta l. com

PROCUREMENT

36

disruptive technologies can bring into

analytics, eSourcing, contract man-

digital procurement.

agement and eProcurement.

In its report, ‘Digital Procurement:

Deloitte observed several key tech-

New Capabilities from Disruptive

nologies that CPOs are beginning to

Technologies’, Deloitte found that an

introduce into operations in a bid to

ever-increasing number of organisa-

establish a competitive advantage.

tions are beginning to deploy several

These are:

different types of core procurement

• Cognitive computing and artificial

technologies. These platforms are usually a combination between spend M AY 2 0 2 0

intelligence • Intelligent content extraction

DELOITTE KEY PEOPLE

Michael Dahler— New York Merril Skyring ­­­— Sydney Zak von Gordon — Johannesburg

AN AGILE APPROACH Deloitte believes that companies should operate with an agile and lean approach in order to adapt with ease to the latest trends in the industry. An agile approach can be effective for delivering digital projects. Deloitte recommends companies: Start small - decide on one or two solutions to begin the digital journey and • Predictive and advanced analytics • Visualisation

prioritise the projects based on impact, cost and speed of development.

Act fast - quickly validate the selec-

• Collaboration networks

tion through the quick result and market

• Crowdsourcing

the success to build momentum behind

• 3D printing

the journey.

• Robotics

Think big - always maintain an

• Blockchain

ambition to innovate and a drive to con-

•Sensors and wearables

tinuously improve.

• Cyber tracking w w w.suppl yc ha i ndi gi ta l. com

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PROCUREMENT

MCKINSEY & COMPANY

these procurement users follow in

The management consulting com-

order to complete tasks.”

pany, McKinsey, has offered an insight of what the future of procure-

typical procurement transformation

ment could look like. In its report,

journey takes around 18-24 months,

‘Digital procurement: For lasting

however, organisations may begin to

value, go broad and deep’, it finds:

see results much sooner than that. “We

“Digitising procurement won’t do a

find that companies can begin achiev-

company much good if its people

ing improvements after just three or

don’t think it helps them get their

four months, and can start building

work done. This means mapping out

scale soon after.”

the details of how people involved in the procurement process work, trac38

In total, McKinsey believes that the

ing each step in their journeys that

KEY PEOPLE

Bjorn-Uwe Mercker — Munich Andre Rocha — Tokyo Roman Belotserkovskiy — Texas Riccardo Drentin — London­­­

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McKinsey & Company: Future of Procurement CLICK TO WATCH

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3:14

39

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S U P P LY C H A I N

40

Embracing digital in supply chain WRITTEN BY

M AY 2 0 2 0

SEAN GALEA-PACE

41

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S U P P LY C H A I N

Stefan Gstettner, Partner & Associate Director in the Frankfurt office of Boston Consulting Group (BCG), discusses the impact of digitalisation in the supply chain

L

everaging innovative technology is essential in any modern supply chain.

Indeed, to succeed in the modern

industry, supply chain digitalisation is a key ingredient. Due to the way customer demands change, companies must use digi-

42

tal technology to be lean and agile or run the risk of being left behind by competitors.

Stefan Gstettner, Partner & Associate Director in the Frankfurt office of BCG, is an experienced supply chain professional.

As part of his role, he exclusively focuses on advising clients in end-to-end supply chain management. Supply Chain Digital speaks with Gstettner to uncover more about the effect supply chain digitalisation is having on the industry.

HOW WOULD YOU DESCRIBE BOSTON CONSULTING GROUP? WHAT DIFFERENTIATES IT? We have a fascinating and to a large extent, unique blend of people, capabilities and M AY 2 0 2 0

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LEARN MORE

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45

insights. This becomes evident

impact can be unfolded – individual

while working on large and complex

excellence in a complex, connected

transformations. Beyond the table

situation does not bring as much value

stakes that every consulting company

as a well formed team. And finally,

provides, we deploy an exceptionally

I feel it’s always inspiring and fun for

diverse and strong set of people with

our clients to work with us.

unique capabilities (e.g. data scientists,

form powerful teams with these

WITH DIGITAL TRANSFORMATION HAVING SUCH A MAJOR IMPACT ON THE SUPPLY CHAIN INDUSTRY, HOW VITAL HAS AI AND MACHINE LEARNING BECOME TO BUSINESSES?

diverse individuals. That’s how real

The most surprising aspect in SCM

change management experts, deep topic experts, IT architecture experts).

For me, the biggest differentiator is that we are able to collaborate and

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S U P P LY C H A I N

is that the word “digital supply chain

but the areas where they are applied

management” is still around. It could

(take demand sensing as an example)

have become the “new normal” already

also need to be carefully embedded in

and we should achieve a consensus

the overall processes and connected to

that no supply chain is “non-digital”

the other elements in the supply chain.

anymore. This means AI and ML as

Not only are the capabilities to run AI

ALTHOUGH TECHNOLOGY IS OFTEN CONSIDERED A VITAL TOOL INDUSTRYWIDE, DO YOU ENVISAGE ANY POTENTIAL PROBLEMS ARISING FROM THE APPLICATION OF NEW TECHNOLOGY? WHAT NEEDS TO BE CONSIDERED?

and ML in supply chains difficult to

A technology-focused view is the big-

acquire and to retain in the organisation,

gest hurdle to unfold the full potential

enabling technologies are an integral part of operating supply chains. I cannot imagine any supply chain without these capabilities anymore. Practically, of course, there are still several hurdles.

46

Digital Supply Chain Transformation CLICK TO WATCH

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2:22

47

“ We have a fascinating and to a large extent, unique blend of people, capabilities and insights� — Stefan Gstettner, Partner & Associate Director, BCG

infrastructure but 70% to change and enable the organisation to work with them. This is not only because

of supply chains. Although the tech-

specific capabilities are needed to

nologies are demanding, in essence

run modern technologies, but the

it is comparably easy to develop

skepticism that people have towards

them. We keep experiencing that

these technologies. These hurdles

it takes 10% of overall effort to

are indeed the true ones when it

develop an algorithm, 20% effort

comes to implementing digital tech-

to implement it in the technological

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S U P P LY C H A I N

48

CAN YOU TALK ME THROUGH BCG’S APPROACH TO RISK MANAGEMENT? IN WHAT WAYS CAN RISKS BE MINIMISED?

variations in the assets or transport

In supply chain management, risk

portation. This concept of managing

management is not a “parallel concept”

and balancing the end-to-end supply

next to managing the supply chain,

chain day-to-day can also be applied

it is truly embedded into it. Let me take

in a major risk environment of today’s

a large chemical client we are working

COVID-19. It’s all about being able

with as an example. We have helped

to quickly balance and re-balance

them establish a supply chain control

the supply chain when something is

tower. This concept is, besides other

changing. Be it small changes or be

objectives, used to manage the day to

it drastic scenarios as today.

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day “risks” in the supply chain, e.g. yield capacity shortages in outbound trans-

WHAT DO YOU FEEL ARE THE BIGGEST CHALLENGES COMPANIES IN THE SUPPLY CHAIN SPACE FACE AND HOW IS RISK MONITORED AND OVERCOME? From my experience, companies struggle to find the best balance between true end-to-end, real-time supply chain monitoring and management on one side, and the right level of granularity to do so. What I mean with this is, that in many companies concepts

“ The most surprising aspect in SCM is that the word ‘digital supply chain management’ is still around”

like end-to-end risk scenario simulation are not applied, because they try

— Stefan Gstettner, Partner & Associate Director, BCG

to do so on the most granular level

E XE CU T I VE PRO FI LE

Stefan Gstettner “I have been working in the supply chain field throughout my entire 25 year career. I have a quantitative, data science focused angle from my PhD, where I was researching production planning methodologies. I took a line management angle during my time as Chief Operating Officer (COO) of an omnichannel retailer in Germany. I still adopt an academic angle as Adjunct Professor, where I teach a digital supply chain master class at MIT in their global SCALE program. And, of course, as I am advising our global BCG clients on their exciting path towards digital supply chain transformations.” w w w. s upp l yc ha i ndi gi t a l .c o m

49

S U P P LY C H A I N

“ We aspire to shape trends in the supply chain space.

For this reason, innovation is key” — Stefan Gstettner, Partner & Associate Director, BCG

basis to inform downstream customers in due course.

AS A CONSULTANCY, THERE IS A HIGH VALUE PLACED ON EMPOWERING COMPANIES TO MAKE BETTER DECISIONS, HOW IMPORTANT IS KEEPING UP WITH THE LATEST TRENDS TO ENSURE YOU ARE DELIVERING EXACTLY WHAT YOUR CUSTOMERS NEED? It goes without saying that our clients

50

of the supply chain, which makes

expect us to be at the forefront of

the simulations too complex. Their

market developments – I would even

take-away often is: it’s not possible.

argue, that’s not enough. We aspire

However, not every scenario needs

to shape trends in the supply chain

to be modeled on the most granular

space. For this reason, innovation

level. Two quick examples: the impact

is key. Next to the two propositions

of a force majeure in an API (active

“keeping up with trends” and “shap-

pharma ingredient) asset in a global

ing trends”, we also deliver value in

pharma supply chain does not need

“translating trends.” I would argue

to be modeled on an SKU basis. More

making sense of the huge amount of

importantly, strategic decoupling

technology promises to be the big-

stocks need to be dimensioned on a

gest bottleneck for our clients. They

higher aggregation level. On the other

are approached by so many vendors

side, the break-down of a WMS soft-

and news about the latest trends that

ware in a pharma country warehouse

it continues to be difficult to under-

directly affects customer deliveries

stand how these developments are

of maybe life-saving drugs and needs

important for them. Therefore, we

to be modeled on an SKU/customer

are constantly having a dialogue with

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51 FACT BOX

BCG’s “eight no regret” moves BCG believes that companies should develop a clear and detailed plan for raising any lagging elements to the appropriate level. The firm believes that organisations can’t afford to stand still in the supply chain. Here are eight steps that BCG advises your company to take...

1. O btain senior level commitment

2. Instill process discipline 3. Break down silos 4. M ake high quality data available 5. Engage with IT 6. T houghtfully select and implement digital tools 7. Establish a talent pipeline 8. P repare for a new way of working

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S U P P LY C H A I N

52

“Customer-centricity is high on the agenda of each of our clients, regardless of the industry,” says Gstettner. “However, it has significantly different twists across industries.

In my conversations with consumer goods or retail clients, customer-centricity is differently discussed than with my large b2b clients. However, increasingly companies want to learn from each other across industries.

We have recently had a workshop with one of our large automotive clients on the topic: “How Amazon would design an end-to-end automotive supply chain.”

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our clients to be their independent advisor in the trend jungle.

WHAT DO YOU ENVISION FOR THE FUTURE OF THE SUPPLY CHAIN INDUSTRY TO LOOK LIKE? At BCG, we are convinced that the future of SCM requires the concept of a “Bionic Supply Chain”. After the phase of “digital supply chain management”, the focus of every activity in the supply chain will come down to new collaboration mechanisms – between machines, between machines and humans and between humans. Therefore, new operating models will need to be developed in order to facilitate these new collaborations. In essence what we say is: it’s not enough that a human uses a digital technology in the supply chain.

All humans, all technologies and all “traditional” supply chain concepts need to be connected in the new “Bionic Supply Chain” operating model.

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53

LOGISTICS

The digital evolution of 3PL services WRITTEN BY

54

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GEORGIA WIL SON

55

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LOGISTICS

Coyote Logistics, UPS, Blue Yonder and EY discuss the digital evolution and changing expectations of 3PL services

T

hird party logistics (3PL), defines a service which encompases a wide range of tailored services often to a

specific industry, company, or multi user in order to reduce costs. It also refers to services that can be provided include warehousing, inbound transport, outbound transport and 56

value-added services. “These can be a single service offering such as freight transportation or warehouse storage. Or it can be a networkwide bundle of services capable of handling supply chain management end-to-end,” comments Jolyon Austin, EY Partner, Supply Chain Transformation.

“Expectations on 3PLs are changing, with clients expecting high levels of order visibility, fast delivery and transparent invoicing. 3PLs will continue to need to improve their capabilities, not only within the services they offer, but also within the technology base that they use and to continue to build the capabilities of their people,” continues Austin. “Finding the right people is a challenge. In some warehouse locations staff turnover can be as much as 2% M AY 2 0 2 0

57

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3PL vs 4PL Logistics: The Layers of Logistics Explained CLICK TO WATCH

|

7:20

59 per week. Often an overlooked, vital

the value-chain to add higher margin

part of the economy, there are an esti-

services, with some aspiring to provide

mated 45,000 driver vacancies in

an end-to-end managed service.”

Germany alone. Investing in the right

Reflecting on the current trends

technologies and robotics to increase

within the industry Jaap Bruining, Head

productivity and reduce manual labour

of Coyote Europe explains that in

costs is a key focus.”

today’s world “it is difficult to separate

Other key trends Austin sees in the

the ‘current trends’ from the ‘technolog-

industry include the adoption of data-

ical trends’ in the global 3PL space.

driven decisions as client expectation

Even trends that are not centred on a

demands analytics expertise. “3PLs will

tech product are often made possible

move from basic descriptive analytics

through technological advances.”

toward prescriptive and cognitive ana-

Providing examples, he explains that

lytics,” he comments. “3PLs are actively

“for instance, the rise of e-commerce is

looking to expand their role beyond

a pervasive force that ripples through

commoditised low margin services in

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LOGISTICS

60

BUT that level of service is only made

incredibly complex supply chain, pro-

possible through sophisticated operat-

viding a wide range of services.

ing, planning and inventory systems.”

E-commerce has amplified the impor-

Bruining has witnessed the ecom-

tance of the supply chain function in

merce trend drive faster and more

almost every business that ships

efficient shipping, with high inventory

physical goods. Some companies are

turnover and inventory staged in for-

choosing to make tremendous invest-

ward locations near consumers. “As a

ments to build out the function internally,

result, there has been a huge influx of

while many others are looking to 3PLs

3PL providers to help support this

to outsource the function.”

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“technology has become an integral part of providing competitive 3PL services.”

Robotics, automated storage and retrieval systems (ASRS), drones, artificial intelligence, machine learning, predictive analytics, autonomous vehicles, on-demand warehousing and fulfillment solutions, and disruptive sensor technology are just some of the ways in which the 3PL sector is harnessing technology. “Other impactful technological trends are enabled by the IoT and cloud technology, to provide end-to-end supply chain visibility and near real-time inventory visibility,” continues Gilbert. “3PLs and their customers have access to more data than ever before and the low cost of data storage and cloud computing has increased expectationS, allowing for Agreeing with both EY and Coyote Logistics, Philippe Gilbert, president of UPS Supply Chain Solutions comments that “trends

innovative leaps in this growing area of digital visibility.”

Agreeing with Gilbert, Peter Van

like ecommerce, rapid technology changes,

Merode, VP 3PL Industry Strategy at

and the digitisation of the supply chain are

Blue Yonder (formerly JDA) comments

bringing new models and competitors to the

that “technology disruptions and digital-

market as well as changing a company’s oper-

isation of data are redefining the role

ating models and cost to serve.”

that 3PLs play and the solutions that

When it comes to the technological trends

within the industry Gilbert believes that

3PLs offer to their customers and THE industry. As the rate of technology w w w.suppl yc ha i ndi gi ta l. com

61

LOGISTICS

Company Profiles

62

EY

Blue yonder

EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services it delivers help build trust and confidence in the capital markets and in economies the world over. EY develops outstanding leaders who strive to deliver on its promises to all of its stakeholders. In doing so, it plays a critical role in building a better working world for its people, for its clients and for its communities.

Blue Yonder (formerly JDA) is an end-to-end supply chain management technology company.

Blue Yonder has 30+ years of both logistics efficiency expertise and deep domain knowledge for the many industries it serves, predominantly in the retail, manufacturing and logistics industry. Industry sectors include automotive, consumer goods, food and beverage, high tech, industrial

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manufacturing, pharmaceuticals/ life sciences and wholesale distribution.

Blue Yonder partners with 3PLs to help them grow, achieve faster time-to-value and maintain a lower total cost of ownership while providing customers the best products and services and the ability to create new logistics solutions.

UPS UPS is a global leader in logistics, offering a broad range of solutions including transporting packages and freight, facilitating international trade, and deploying advanced technology to more efficiently manage the world of business. Headquartered in Atlanta, UPS serves more than 220 countries and territories worldwide, and operates one of the largest airlines in the world, as well as the world’s largest fleet of alternative-powered vehicles. UPS is also a leader in the U.S.

less-than-truckload industry. UPS Supply Chain Solutions consists of forwarding, logistics and distribution, truckload brokerage, freight, and related services.

Coyote Logistics Coyote Logistics is a leading global 3PL provider that combines a diverse, centralised transportation marketplace matching more than 10,000 shipments every day.

Coyote offers a comprehensive multi-modal solutions portfolio including truckload, less than truckload (LTL) and intermodal with data intelligence and market insights to help empower its customers’ business growth in a rapidly changing world. Coyote became a UPS company in 2015, adding to its expanding portfolio of global services. Headquartered in Chicago, Coyote has more than 3,000 employees operating in 20 offices worldwide.

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63

CONTRACT MANGEMENT

64

innovation accelerates, retailers and

effective processing of data, providing

manufacturers are digitally transform-

ways to predict supply chain events

ing and reinventing themselves to

and disruptions to make more intelli-

remain competitive. They are looking

gent decisions and with less need for

for fast and flexible services to support

human intervention.

them through this period.”

Van Merode asserts that “Big Data

Austin sees transport and warehouse management systems (TMS and WMS)

provides an opportunity for distributors

moving further into the cloud, with

and 3PLs to differentiate their value

Blockchain gaining significant traction

propositions. The ability to gain insight

in multi-party value chains where an

from the data provides real-time visibil-

immutable record is required. “3PL

ity, security and efficiency, as well as the

providers are investing in the ability

opportunity to predict and proactively

to provide end-to-end visibility and

act on supply chain risks.” He also high-

traceability across the supply chain.

lights the importance of artificial

With more data flowing through the

intelligence (AI) and machine learning

supply chain, the opportunities for

(ML), which are also integral to the

improvement and gains within analytics

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FACT B OX

DHL the difference between 3PL and 4PL services Next to its 3PL business DHL Supply

have all the necessary expertise in

Chain also has a separate unit, through

house,” comments Paul Stone, CEO

which it acts as a ‘fourth party

LLP/Transport MLEMEA at DHL

logistics’ (4PL) provider. This service

Supply Chain.

differs from 3PL by providing a more

Stone adds that there are many

comprehensive service that manages

aspects to consider, when developing

the end-to-end supply chain and all

the best strategy to provide 4PL

the parties involved with the

services “but we believe having the

customer, on behalf of the customer.

right technology in place and hiring

4PL services include transportation,

the right people, as well as making

distribution, procurement,

sure to act independently is critical to

warehousing and manufacturing,

providing successful 4PL services.”

which is concentrated in a control

DHL is focused on customer centricity,

tower from where all the involved

which means:

parties are managed. To provide these services a state of the art IT system is needed to have visibility of what is happening in the supply chain and to be able to optimise.

• Regularly seeking and instantly implementing customer feedback • Creating immediate value for the customer • Using data-driven insights to

“4PL services give full visibility on the

anticipate customer needs

end-to-end supply chain and by this

DHL Supply Chain is one of the

the opportunity to optimise the

biggest contract logistics companies in

supply chain and so constantly

the world. DHL provides 4PL services

increase the service levels and reduce

across the globe, managing supply

cost. This can be particularly

chain operations to reduce

beneficial to businesses that have

complexity for its customers. With

complex and long supply chains with

160,000 employees in more than 60

many different parties involved and

countries, DHL is by far one of the

that do not have or do not want to

leading contract logistics providers.

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65

CONTRACT MANGEMENT

industry.

Whether at a driver level through electronic logging devices (ELD) or at a piece level with radio frequency identification (RFID) devices, gaining insight to the real-time movement of freight is getting significant investment across the 3PL 66

space,”

are significant. With the added benefits of artificial intelligence and machine learning on top of big data companies can provide more value-added information and insights to become more

adds

proactive and less reactive.”

Bruining.

Other applications of technology that

“Accurate tracking

experts predict within 3PL include the

allows for further system

use of augmented and virtual reality to

and process Contract Mangements,

replace traditional Radio Frequency

giving people the right information at

(RF) or voice enabled task management

the right time to make business

in order to drive operator efficiency and

decisions.”

accuracy. “Digital tracking technology is another key focus for much of the M AY 2 0 2 0

Agreeing with Bruining, Austin adds that “the Internet of Things (IoT) is

taking digital tracking to the next level,

Mangement, GPS devices, drones,

providing real-time information about

autonomous vehicles, block-chain,

operators, inventory, material handling

AI and other digitally-enabled tech-

equipment from a variety of sensors

nologies, we will see new tech-savvy

and RFID tags to optimise in-train task

3PLs emerge. The future 3PLs will be

management and improve safety.”

able to successfully integrate, share

In addition, 3PLs are managing

data and harness the power of these

customer orders and billing with

technologies with advanced analyt-

the application of robotic process

ics, which will ultimately be used to

Contract Mangement (RPA) eliminates

fine-tune and optimise processes

error-prone repetitive tasks and

and supply chain flows, before they

increasing capability levels. “In prac-

even happen.”

tice, AI, ML and IoT can drive

Adding to Gilbert’s predictions,

autonomous innovation allowing for

Austin concludes that “the future

faster implementation and improved

will entail more flexible, on-demand

interaction with human labour. Using

many-to-many relationships includ-

these innovations companies can

ing: flexible warehousing as a service

manage and interpret data signals

using smart contracts with more cost

from a huge range of sources, ranging

transparency; plug and play connec-

from weather events, to social media,

tion to systems and full end-to-end

DC-internal processes and even

tracking; transportation that is flex-

live traffic, developing a holistic

ible and easy to organise with

picture of supply chains and react in almost real time.”

Looking to the future, Gilbert predicts that “in the next 10-20 years,

peer-to-peer. Logistics providers will be able to offer the full order to cash cycle with operational excellence and system integration.”

we will see a dramatic shift from the traditional 3PL to a modern, full-service 3PL. With the proliferation of cloud computing, warehouse Contract w w w.suppl yc ha i ndi gi ta l. com

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TECHNOLOGY

68

M AY 2 0 2 0

THE INTRODUCTION OF

BLOCKCHAIN IN THE SUPPLY CHAIN WRITTEN BY

SE AN GA LE A-PACE

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69

TECHNOLOGY

The introduction of blockchain has brought new opportunities into the supply chain, but what are they?

T

he age of the digital supply chain is here.

With new technologies such as AI, Big Data and blockchain at companies’ fingertips,

there is an increasing importance to adopt new processes into operations to maintain a proactive sup-

70

ply chain approach. In this article, we define exactly what blockchain is and review the impact it has had in the supply chain space over the past few years.

WHAT IS BLOCKCHAIN? Blockchain is essentially, as the name suggests, a chain of blocks. However, instead of a physical chain, there’s digital information (the block) stored in a public database (the chain). When a block stores new data, it is added to the blockchain. In order for this to be done successfully, four things must happen: 1. A transaction must occur – After making an online purchase, a block will group together thousands of transactions so that an individual’s purchase will be packaged in the block along with other users’ transaction information as well.

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71

–

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Trusted Digital Advisor We help insurers connect the dots across the globe and region – becoming customer-led, operationally smart Connected Enterprises

Anticipate tomorrow.

Deliver today. kpmg.com/cn

Š 2019 KPMG Advisory (Hong Kong) Limited, a Hong Kong limited liability company and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. All rights reserved. Printed in Hong Kong.

FACTS

Jolyon Austin, EY Partner, Supply Chain Transformation, believes Transport and Warehouse Management Systems (TMS and WMS) will further move to the cloud. “Blockchain is gaining significant traction in multi-party value chains where an immutable record is required. Where 3PLs are managing customer orders and billing, the application of Robotic Process Automation (RPA) eliminates errorprone repetitive tasks,” he says.

“Increasing levels of capability mean bots can automatically capture order reference and tracking numbers, and update delivery status and proof of delivery through regular queries to carrier tracking systems. As orders are filled, clients receive notifications with order details and a link for tracking the

order, tracking inventory, checking stock levels and notifying customers about issues. Visibility and reporting platforms enable more real time connectivity. 3PL providers invest to be able to give clients end-to-end visibility and traceability across the supply chain (track and trace of shipments or warehouse movements). With more data flowing through the supply chain, the opportunities for improvement and gains within analytics are significant; increasing use of artificial intelligence and machine learning on top of Big Data provides their clients with more value-added information and insight. Predictive AI enables logistics operations to become more proactive and less reactive (e.g. AI in last mile delivery for calculating optimised routes).”

2. That transaction must be verified

block and will join thousands of similar

Following a purchase, a network of

transactions like it.

computers checks over each transac-

4. That block must be given a hash

tion to ensure it happened in the way a

Once all of the block’s transactions

customer said it did. The network con-

have been verified, it must be given a

firms the purchase, including the time,

unique, identifying code called a hash.

amount and participants of a transac-

Once hashed, the block can be added

tion in a matter of seconds.

to the blockchain.

3. That transaction must be stored transaction gets the go ahead. The

HOW IS BLOCKCHAIN INFLUENTIAL IN THE SUPPLY CHAIN?

transaction’s details are all stored in a

There are several key ways in which

in a block – Following verification, the

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TECHNOLOGY

blockchain is useful in the supply chain.

and RFID tags.

These are:

• Cost reduction – Real-time tracking of

• Provenance tracking – Large organi-

a product in the supply chain through

sations have complex supply chains.

the help of blockchain can reduce the

This means it is much harder to keep

overall cost of moving items in a sup-

track of all records for multinational

ply chain. Following a survey of supply

companies. This lack of transpar-

chain workers by the Digital Supply

ency can affect organisations sig-

Chain Institute, over one third of people

nificantly. In a blockchain-based

cited reduction of costs as the topmost

supply chain management, record

benefit of application of blockchain in

keeping and provenance tracking is

supply chain management.

made easier as product information

• Establishing trust – Developing trust

is accessed by embedding sensors

in complex supply chains with large

74

“ Blockchain is seen as an invaluable asset in the supply chain process as it provides an essential layer of trust and transparency in today’s volatile environment” — Jorg Junghanns, Vice President Europe, Digital Supply Chain, Capgemini M AY 2 0 2 0

Capgemini Invent Talks: Blockchain in Supply Chain Management CLICK TO WATCH

|

5:10

75 numbers of participants is key to smooth

of issues in the supply chain, namely

operations. For example, if a manufac-

traceability, which improves crisis

turer shares its products with suppli-

handling. If a group of customers fall

ers, the manufacturer should be able to

ill in the same area, the common prod-

depend on that supplier to follow factory

ucts they bought and the retailers they

safety standards.

bought from can be analysed to detect where the potential problems stem

CAPGEMINI

from. Blockchain can check the audit

In Capgemini’s report, ‘Does blockchain

trail, which includes the origins of the

hold the key to a new age of supply

ingredients, and find out which ingredi-

chain transparency and trust?’, it was

ent is causing the issue.

discovered that blockchain has created

“Blockchain is seen as an invaluable

a plethora of new opportunities for the

asset in the supply chain process as

supply chain space.

it provides an essential layer of trust

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TECHNOLOGY

environment,” says Jorg Junghanns, Vice President Europe, Digital Supply Chain at Capgemini. “Traceability and its authenticity are a critical aspect of the supply chain for an organisation and businesses need to look at new trust-based models that are only made possible by blockchain. By creating an immutable distributed database of transactions, along a product’s journey in the supply chain, blockchain can combine real-time data and tamperproof the storage of that data. Imple76

menting this into an organisation’s ecosystem enables them to tackle key supply chain issues like traceability, counterfeiting, costs and consumer trust – all of which are essential for any business to overcome when looking to edge ahead.”

EY In its report, ‘Blockchain: how this technology could impact the CFO’, EY examined how blockchain is transforming the CFO’s role. EY believes the expectations of the CFO position is changing. CFO’s traditionally have three key roles: execution, enablement and development. These M AY 2 0 2 0

consist of six segments: trusting the numbers, providing insight, getting your house in order, funding organisational strategy, development of business strategy and communication to the external marketplace.

In the latest ‘DNA of the CFO’ study, it was found that 58% of finance leaders identified digital as one of the four forces transforming the CFO role.

Blockchain technology is considered a core component of the latest digital trends and is recognised as being one of the most impactful digital disruptions shaking up the finance function.

One of the main challenges remains a lack of understanding about the evolving field of distributed shared ledgers. Among the finance leaders that EY surveyed, it was also revealed that 58% globally would “need to build their understanding of digital, smart technologies and sophisticated data analytics” in order to deliver against important strategic priorities.

AVETTA In Avetta’s white paper, ‘Transforming the supply chain into an Opportunity Centre’, blockchain is one of its w w w.suppl yc ha i ndi gi ta l. com

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TECHNOLOGY

78

“ Blockchain can address a range of issues in the supply chain, namely traceability, which improves crisis handling”

ways to transform the supply chain amidst digital transformation. Avetta believes that one of the greatest benefits is that a “blockchain-driven supply chain ecosystem allows all stakeholders to securely save information relating to product price, location, quality and certification.”

Avetta’s research shows that procurement leaders face three fundamental challenges in their supply chain transformation journey: budget, lack of organisational urgency and the implementation of new technology into legacy systems.

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OpenText: Enabling the autonomous supply chain with IoT, AI and Blockchain CLICK TO WATCH

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2:17

79

The introduction of AI, cloud computing,

networks. OpenText partnered with

and data analytics has accelerated inno-

BlockEx, a leading provider of block-

vation in the supply chain space, while

chain digital asset exchange services,

blockchain has allowed for greater real-

to jointly explore how global supply

time visibility into the supply chain. With

chains can leverage blockchain technol-

an enhanced visibility of goods, the entire

ogy. At the time, Adam Leonard, CEO

supply chain can reduce waste with just-

of BlockEx, commented: “BlockEx

in-time planning and accurate inventory

is pleased to partner with OpenText.

management.

Teaming up with OpenText to develop a blockchain-based trade finance mar-

OPENTEXT

ketplace is truly exciting. Our partner-

The company is a leader in Enterprise

ship allows some of the world’s largest

Information Management and operates

supply chains connected to OpenText

one of the world’s leading business

Business Network to simply opt-in to w w w.suppl yc ha i ndi gi ta l. com

TECHNOLOGY

blockchain-based trade finance.”

In OpenText’s white paper, ‘The supply chain gets smarter’ the organisation believes there are two key ways that blockchain can generate value into operations. Blockchain can provide: The ability to execute code autonomously, across a distributed application that resides on a blockchain smart contract platform and not under any single entity’s control. This is primarily in ecosystem environments where multiple parties have the 80

determination to interoperate without recourse to a potentially more expensive intermediary.

The irrefutable provenance that comes with an immutable ledger. This means that the data that is used in establishing an audit trail of shipment conditions, or alternatively introduced into analytics and AI services can be trusted to enable decisions to be made with confidence.

IBM In IBM’s report, ‘Building your blockchain advantage: Fresh insights on how to create value, scale fast and open new markets’, the tech giant conducted M AY 2 0 2 0

FACTS

Blockchain as a force for good: Five principles to build trust and value 1. Open is better — blockchain networks should harvest diverse communities of open source contributors and organisations.

This will allow for open innovation as well as strengthen the overall quality of code.

2. Permissioned doesn’t mean private — blockchains should be designed around the principle of permissioned and trusted access.

Permissioned blockchains have an access control layer to allow certain actions to be performed only by certain identifiable participants. Most organisations require the necessity to know exactly what business they’re conducting business with as well as ensuring no illegal activity is being transacted over the network.

3. Governance is a team sport — enterprise blockchains should embrace distributed and transparent governance to enable

networks to serve the requirements of participants and prevent undue concentrations of influence.

4. Common standards are common sense — enterprise blockchains should be centred around common standards with interoperability in mind. This will enable “future-proof ” networks, prevent vendor lock-in and encourage a robust ecosystem of innovators.

5. Privacy is paramount — participants on an enterprise blockchain must be able to control who can access data and under what circumstances. This is vital on a platform that distributes data widely across multiple nodes. Despite no single participant owning a blockchain network, the rights to the data that resides on it should always belong to the creator.

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TECHNOLOGY

“ Real-time tracking of a product in the supply chain through the help of blockchain can reduce the overall cost of moving items in a supply chain” 82

a survey of more than 1,600 executives across eight industries.

It was found that: • Over 60% of early adopter organisa-

— an estimated US$1.2trn - to introduce new platform business models.

As organisations continue to define their blockchain strategies, IBM rec-

tions surveyed anticipate to have a

ommends that companies pursue five

blockchain network in production by

key steps:

the end of 2020.

1. Scan for opportunities – consider

• Over half 50% of surveyed C-suite

all opportunities to not just expand the

respondents expect the sharing

options, but also find a way for one use

economy to reshape their business

case to evolve into another.

models.

2. Measure ecosystem viability – for

• Around 33% of organisations are reallo-

each use case, identify the network

cating considerable amounts of capital

members required to measure the

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83

solutions on the blockchain. Decide

4. Future proof your network – organi-

the benefits that each could achieve

sations should consider the tipping

and ensure those benefits could be

point to recognise network effects of its

distributed across members.

first objective. To scale, consider and

3. Calculate the network equation –

decide what new members could be

the cost of developing and operating

added to attract others to the network.

a blockchain platform, in addition to

5. Keep your options open – all organi-

governing it, should be essential to the

sations must determine and decide

monetisation strategy. It could poten-

whether it is best to create a blockchain

tially include the network raising fees

network on its own, work with others

and royalties from its members, charg-

to form a new network or participate in

ing for access to data or by the volume

another’s blockchain platform.

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T O P 10

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Procurement software vendors Supply Chain Digital ranks its top 10 global procurement software vendors WRITTEN BY

GEORGIA WILSON

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T O P 10

HQ

NORTH CAROLINA

1,000+ NUMBER OF EMPLOYEES

CEO JIM BUREAU

86

10

Jaggaer [ USA ]

Established in 1995, Jaggaer is one of the leading providers of source-to-pay solutions for commercial, manufacturing and life sciences, as well as procure-to-pay solutions for higher education and government sectors. Jaggaer’s JAGGAER ONE solution offers procurement leaders and suppliers full digital transformation across the entire procurement spectrum. Its modular solutions and unified digital platform integrates easily with ERP and accounting systems to help organisations build a fluid supply chain.

M AY 2 0 2 0

HQ

CALIFORNIA

1,000+ NUMBER OF EMPLOYEES

CEO

ROB BERNSHTEYN

09

87

Coupa Software [ USA ]

Established in 2006, Coupa Software takes a comprehensive approach to business spend management. Its unified platform lets companies see everything they need in one transparent, user-centric, end-to-end efficient, community powered place. Coupa’s innovation philosophy is to transform the way that businesses manage their spend. “In partnership with the Business Spend Management (BSM) Community, we are co-creating new and unique capabilities that empower our customers, partners, and suppliers with increased visibility, actionable insights, and solutions to manage their spend,” it states.

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88

Simpler.

Smarter.

Faster.

Run Coupa.

The Cloud Platform for Business Spend Management.

Join us at Europe’s Premier Business Spend Management (BSM) Event Learn more at coupainspire.com

T O P 10

HQ

CALIFORNIA

200+ NUMBER OF EMPLOYEES

CEO DAVID KHUAT-DUY

08

89

Ivalua [ USA ]

Established in 2000, Ivalua was built on the idea “that procurement can unlock significant strategic value from a company’s spend and supply chain.” Ranked as a leader by Gartner in 2018 and 2019, and also by Forester in 2019, Ivalua is a complete source-to-pay platform designed to be flexible So far, the company has helped more than 300 leading businesses to achieve a competitive advantage with strategic management of over US$500bn in spend. The three core services Ivalua’s suite provides to empower its users include: full digitalisation of procurement and supply chain processes, management of all spend categories and improved transparency and data quality.

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T O P 10

HQ

FINLAND

1,000+ NUMBER OF EMPLOYEES

CEO KLAUS ANDERSEN

90

07

Basware [ EUROPE ]

Established in 1985, Basware strives to simplify and speed up payments by providing purchase-to-pay solutions and services, in order to remove the need for paper invoicing to streamline the procurement process. Basware solutions streamline the financial process, allowing businesses to gain visibility into the overall spend to release working capital to the supply chain. Basware offers experience, advice and guidance to provide its clients with best practices, business processes and change management practices to achieve short term objectives and long term goals.

M AY 2 0 2 0

HQ

NEW YORK

10,000+ NUMBER OF EMPLOYEES

CEO

KEVIN SAMUELSON

06

91

Infor [ USA ]

Established in 2002, Infor is a global enterprise that provides software products for all aspects of an organisation's business. Infor builds industry suites in the cloud in order to efficiently deploy technology that integrates with existing systems, drives customer centricity and leverages data science. Currently more than 68,000 organisations around the world harness Infor’s technology to achieve business-wide digital transformation, in order to overcome market disruptions. “From manufacturing to healthcare and retail, we cover all industries and have ERP end-to-end solutions that are brought together by artificial intelligence technology”

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HQ

NEW JERSEY

1,000+ NUMBER OF EMPLOYEES

CEO SUBHASH MAKHIJA

05

93

GEP SMART [ USA ]

GEP SMART is a unified procurement software platform. It allows procurement professionals to drive greater efficiency and performance via a comprehensive solution for direct and indirect procurement.

GEP SMART is designed to streamline and automate an organisation's source-to-pay processes in a state-of-the-art cloud platform.

Established in 1999, GEP SMART’s platform was awarded the Best Procurement Technology Award by World Procurement Awards in 2019.

Its award-winning platform provides solutions for: spend analysis, savings tracking, sourcing, contract management, supplier management and procure to pay.

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T O P 10

HQ

ARIZONA

5,000+ NUMBER OF EMPLOYEES

CEO GIRISH RISI

94

04

Blue Yonder [ USA ]

Established in 1985, Blue Yonder - formerly known as JDA Software provides its users with an artificially intelligent platform that organisations can utilise for business planning, execution, delivery and workforce solutions for end-to-end business optimisation. Blue Yonder strives to provide predictive capabilities in order to prevent disruption across an organisation with the use of artificial intelligence (AI) and machine learning (ML).

Blue Yonder provides the benefits of an optimised and autonomous business decision making platform to increase profitability and deliver a seamless customer experience that is both scalable and secure.

M AY 2 0 2 0

HQ

NEW YORK

10,000+ NUMBER OF EMPLOYEES

CEO ARVIND KRISHNA

03

95

IBM [ USA ]

Established in 1911, IBM has been believing in world-changing progress for more than 100 years. It explains: “IBMers believe in progress - that the application of intelligence, reason and science can improve business, society and the human condition.”IBM strives to develop innovations that matter not only for its own growth, but for its clients and for the world.

IBM’s procurement and strategic sourcing services, provide end-to-end solutions that have been digitally reinvented with technology, analytics, cognitive insights and IBM Design Thinking.

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E M E A | A P A C | | APAC N O R T H | A EMEA MERICA AMERICAS FIND OUT MORE

FIND OUT MORE

T O P 10

0000 YEAR FOUNDED

Oracle [ USA ] Oracle has helped people to see data in new ways, discover insights and unlock endless possibilities, since 1977.With Oracle’s ERP procurement platform, the company provides 98

$0.0bn REVENUE IN XXXXXXXXX DOLLARS

0,000 NUMBER OF EMPLOYEES

its users with a standardised, streamlined and automated source-to-pay process. With this cloud technology, organisations can benefit from a more efficient, effective and influential procurement process, for direct and indirect spend for businesses of all sizes. Key features of Oracle’s ERP procurement platform: • Sourcing • Supplier management • Contracting • Procure-to-pay

HQ

CALIFORNIA

10,000 NUMBER OF EMPLOYEES

CEO LARRY ELLISON

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Oracle's Journey to ERP and EPM Cloud: Tomorrow's ERP, Today CLICK TO WATCH

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11:56

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T O P 10

SAP Ariba [ USA ] As supply chains become increasingly complex, organisations need more from procurement operations, as a result of consumers requiring more speed, better quality, the best experience and full transparency.

Established in 1996, SAP Ariba provides an 100

extensive portfolio of solutions for companies of all sizes, to drive rapid innovations within procurement, fulfilment and financial supply chain management processes, to make source-to-pay operations simple and smart.

SAP Ariba’s solutions include: • Supplier management • Strategic sourcing • Solutions for direct spend • Procurement • Financial supply chain • Solutions for midsize and growing companies • Selling and fulfillment • Services for buyers

HQ

CALIFORNIA

1,000+ NUMBER OF EMPLOYEES

Executive CHRIS HAYDON

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The New Procurement Experience CLICK TO WATCH

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102

POKKA: transforming the total beverage production and distribution value chain

WRITTEN BY

DANIEL BRIGHTMORE PRODUCED BY

CAROLINE WHITELEY

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w w w. s up p l y c h ain digi t a l . c o m

P O K K A P T E . LT D .

POKKA is focused on upgrading its production lines and leveraging the power of data to improve supplier relationships and distribution

T

he Japanese conglomerate POKKA Pte Ltd in Singapore, whose ultimate parent is Sapporo Holdings, manufactures,

markets and distributes POKKA to all markets internationally, except Japan. In addition, POKKA in Singapore also distributes a range of brands 104

including Sapporo beer, Evian, Volvic, Badoit, Red Bull, Bundaberg and others in the Singapore market. Sapporo Holdings in Japan has three divisions covering alcoholic beverages, a Japan-focused property arm and a food and beverage group, where POKKA sits.

POKKA is one of the Japanese giant’s most successful brands in the Asia Pacific region, where it is a market leader for healthy drinks choices with no preservatives in Singapore. POKKA is also one of the only manufacturers that offers real brewed RTD beverages in the coffee and tea category.

Our brand has won Asia’s Influential Brand Awards for the last two consecutive years as Asia’s best non-carbonated beverage. POKKA operates three manufacturing plants in Asia, one in Singapore and two in Malaysia.

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P O K K A P T E . LT D .

“ The board backed us to be more flexible and got behind the process of upgrading old and inefficient production lines” — Rex Macaskill, Group Chief Supply Chain Officer, POKKA 106

Rex Macaskill, Group Chief Supply Chain Officer, explains that, as well as manufacturing, POKKA handles its own distribution across Singapore via its warehouse network, with deliveries to the modern trade, general trade, coffee shops, schools and more.

“Where our competitors might outsource to 3PLs, we have our own local distribution networks which makes our business more complicated from a logistics perspective,” he adds.

Macaskill’s role encompasses the entirety of POKKA’s supply chain; making reference to his previous job title – Director & Head of Supply Chain, Manufacturing, R&D, Procurement and Distribution – he jokes, “I have to wear many hats. When something goes wrong, I’m the first person they call.”

TRANSFORMING PRODUCTION Macaskill joined the company in the winter of 2018, at the beginning of a period of transformation after a tough couple of years. Following an up-swing in 2019, he recognises several factors that have contributed. “The board backed us to be more flexible and got behind the process of upgrading old M AY 2 0 2 0

There’s Always a Pokka CLICK TO WATCH

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0:30

107 and inefficient production lines,” he

small runs to test the market and play

explains. “At the moment we run on

the niche game. As exporters we might

minimum order quantity which, for

be required to supply a niche product

example, might mean the line needs to

to Dubai and a different version for

produce 5,000 cartons at a time. The

Cyprus. Our new production line will

new lines will allow half that, which

help us become more flexible in a cost-

will make for a more agile process.”

effective way.”

Macaskill makes the important distinction that POKKA is not a marketing

DRINKING IN THE DATA

company based on huge volume, like

Macaskill explains that when he arrived

Coca-Cola, but has a focus on product

at POKKA the company was working

development and trying to innovate

in silos; being reactive rather than

to bring something new to the market.

proactive. “I went back to ‘back-to-

“In doing so, we don’t make massive

basic principles’ with how we were

production runs,” he adds. “We’ll do

working,” he says. “We needed greater w w w. s up p l y c h ain digi t a l . c o m

LHT Holdings Limited (Singapore) Telephone:(65) 62697890 Websites www.lht.com.sg www.ippcpallet.com www.ecrpallet.com

“ We needed greater transparency with data across the whole value chain so our people could see the consequences of their actions or non-actions” — Rex Macaskill, Group Chief Supply Chain Officer, POKKA

to make accurate forecasts. This col-

laboration contributed to POKKA’s renewed success in 2019.

transparency with data across the

CHANGE MANAGEMENT

whole value chain so our people could

The move away from pen and paper,

see the consequences of their actions

and manual stock taking, to the

or non-actions.” From that perspective,

introduction of excel templates has

Macaskill notes that the application

improved efficiency at POKKA. With

of technology was less about having

many people having been at the com-

the latest shiny things and more about

pany for 10-20 years, training was key

taking existing data and making it

to a smooth transition to new ways

available to multiple teams.

of working and educating staff in the

“We created shared drives so, for

importance of accurate stock checks.

example, people could view their

“Change is the biggest bottleneck,”

production and market plans. It was

confirms Macaskill. “We can’t be in

important to improve the visibility of

a situation where we run out of stock

data and actions. For instance, we

and lose money for the company, or

could have items in stock but not know

end up in a situation where we have

how long they had been sitting in the

too much stock. Overstocking puts

warehouse. Now, we’re producing

stress on warehouse space which hits

weekly reports and not relying on men-

costs. I’ve been coaching our teams

tal calculations.” This overview helps

so they can understand the financial

POKKA’s plants decide what they

impact of one department on another,

need to produce next and enables

see the chain effect and appreciate

sales teams to focus on what’s selling

why it’s so important to become more w w w. s up p l y c h ain digi t a l . c o m

109

P O K K A P T E . LT D .

CO MPAN Y FACT S

• Combined storage space of 420,000 square feet • Pallet Capacity of 30,000 • POKKA has a truck f leet of more than 50 vehicles • International business across 40 countries • POKKA canned coffee was the first product to be made in Singapore in 1977

110

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P O K K A P T E . LT D .

112

accurate in what they do.” Going

rather than simply accepting annual

forwards, Macaskill says this will be

price increases. “We don’t need the

further supported by the re-imple-

best technology to achieve these

mentation of POKKA’s ERP system

gains,” he reasons. “It’s about get-

and adding technology systems such

ting back to basics, because supplier

as WMS and TMS to further auto-

management is so important.

mate and improve efficiency across

Communicating with them about

the value chain.

the latest trends can help us understand what’s happening in

COLLABORATION BREWS INNOVATION

Thailand, Indonesia and beyond.

Macaskill applied the same approach

We’re going to start working more

to the procurement of packaging and

on these collaborative projects

raw materials to ensure POKKA was

when we set up our innovation

getting the best deal from suppliers,

team at POKKA, which will include

M AY 2 0 2 0

suppliers joining our brainstorming

1) Find the Money: Understanding

sessions because they come with new

current spend with a data driven

ideas for raw materials and concepts

approach to find untapped savings.

2) Get the Money: Tightly controlled

for future products.”

This back to basics approach

strategic sourcing projects with

lies at the heart of Macaskill’s view

clear accountability and targets.

on the modern, rapidly evolving

3) Keep the Money: The right infra-

procurement function. In such an

structure and processes need

environment, he believes that work-

to be put in place so savings

ing with stakeholders on the four key

stay “saved”.

elements of procurement transformation are essential.

4) Optimise: Tax optimisation to sustain the realised savings

E XE CU T I VE PRO FI LE

113

Rex Macaskill With a career spanning 20 years in manufacturing, distribution, supply chain and strategy consultancy, Rex brings an impressive array of cross-functional talent and experience to the Group. His background in engineering, operations, business administration, strategy and finance combines state-of-the-art knowledge across the full spectrum on the business process from starting new businesses, to building growth markets and turning around loss-making concerns.

Before joining the Group, Rex served as Director of South East Asia Consulting arm with PricewaterhouseCoopers South East Asia Consulting and Strategy, where he was involved in providing consultancy in various areas including supply chain, strategy, corporate and digital transformation.

Having lived and worked in eight countries, Rex is firmly in touch with the global and regional nuances that drive good business from US to Vietnam, and beyond. w w w. s up p l y c h ain digi t a l . c o m

P O K K A P T E . LT D .

114

He explains that the role of procure-

“We’re working with partners like

ment is now viewed as a vital function

Tetra Pak on trial runs with new

that is essential for supporting busi-

product development,” Macaskill

ness goals. As such, the procurement

continues. “We have a good rela-

function has shifted from one centred

tionship and use their machines at

around just purchasing to strategic

our factory in Malaysia where we’ve

procurement, which encompasses the

addressed quality issues. The big

management of end-to-end supply

topic is sustainability; we’re looking

chains, proactively managing key cat-

at solutions to reduce plastic straws

egories, using automation and e-tools,

in our Tetra Pak products and offer

and procurement professionals acting

a paper alternative but at the moment

as highly skilled relationship managers.

the issue is cost.”

M AY 2 0 2 0

“ A focus on Procurement basic principles has led to a significant improvement of margins” — Rex Macaskill, Group Chief Supply Chain Officer, POKKA any out of stock issues and not to mention unnecessary handling and transportation costs. We aim to rebuild our central warehouse into a multiplestory logistics hub by 2023. We’ll need to go through several phases to merge our warehouses for manufacturing and distribution together. We will implement a warehouse management system (WMS) and a transport

SUPPLY CHAIN GAIN

management system (TMS) to help

Macaskill is excited about POKKA’s

us run the whole operation efficiently

new partnership with a 3PL consult-

and cost effectively. We want to

ant. “This will help us to transform our

deploy data analytics to better under-

supply chain in terms of warehouse

stand the behaviour of the customer

and distribution management,” he

and the delivery process, so that we

says. “Currently we have five different

can bring in AI to predict when cus-

warehouses in Singapore to manage

tomers will order, as well as what

our packaging materials, raw materials

they will order.”

and finished goods. Our objective is to

Building on that new supply chain

have one warehouse as our distribu-

approach, POKKA plans to “convert”

tion centre which will help us avoid

delivery drivers into salespeople over w w w. s up p l y c h ain digi t a l . c o m

115

The leading paper packaging supplier in Asia.

Cheng Heng Paper provides affordable, customized solutions for manufacturing, logistics, F&B, retail industries and more.

HEADQUARTERED IN SINGAPORE, SERVING ASIA. Learn More

ESTD 1980

We’re passionate about our work. We exist to excellence the built environment, and to make the process enjoyable for everyone.

LEARN MORE

1977

Year founded

420,000 sq. ft

Storage space with separate racking systems

2000+

Vending machines in Singapore

50+

Number of trucks in fleet

RECRUITMENT CHALLENGES Recruitment in Singapore represents a challenge for Macaskill and his team.

“Singaporeans don’t always like to do the lower-skilled jobs,” he says.

“However, the government is introducing new quotas on the number of foreign workers allowed. In 2019, for example, for the service sector, the figure stood at 40% of the workforce; this has reduced to 38% in 2020, although our understanding is that the government aims to reduce this to 35% in 2022. In manufacturing, the figure stands at 60%, which helps us.

However, changes will actually force companies like us to move towards more automation, therefore we will need to get higher skilled people who

the next three to five years. “Our

will be predominantly Singaporean or

truck drivers make deliveries to cof-

a Permanent Resident of Singapore

fee shops and other market outlets.

(Singapore PR). The challenge will be

We’re looking at a more automated

to upskill the native workforce to meet

system where predictive analytics will

the needs of digital transformation.”

help us load each truck with the deliveries outlets need, while the driver

PLANNING FOR SUCCESS

can check inventories on a mobile

POKKA’s factory in Malaysia is in a

device and take new orders on the

free industrial zone and is only allowed

spot. This way, the truck becomes

to export 20% of its products from

a mobile warehouse.”

Malaysia. Macaskill explains that he w w w. s up p l y c h ain digi t a l . c o m

117

P O K K A P T E . LT D .

has been working with the Malaysian government to avoid the payment of duty on that 20% so that the impact on margins is lessened and profitability is improved.

POKKA’s Group Chief Supply Chain Officer has also been looking at transportation modes to reduce costs. “I’ve been working with suppliers to provide us with double decker trucks which can load almost double the quantity of product – up from 22 pallets to 40 – which also brings cost savings from 118

a cost-per-unit perspective.” At the company’s main warehouse in Singapore, this approach is also being applied to forklift trucks. These are

much more cost effective for imported

being switched for a different model

raw materials in the free industrial

capable of a tighter turning circle

zone. For example, the company is

which allows the space to install

saving on core commodities like sugar

another row of racks in the warehouse.

this way. “A focus on Procurement

“This means that we can improve our

basic principles has led to a significant

warehouse utilisation (number of pal-

improvement of margins,” he confirms.

lets per square meter) with more than 20%, leading to significant cost savings,” explains Macaskill.

POKKA is also benefiting from new

2020 VISION: MOVING TOWARDS A CIRCULAR ECONOMY “How sustainable can we become

savings via procurement. Macaskill

while managing rising costs?” asks

is leveraging the distance between

Macaskill. It’s the biggest trend he’s

Singapore and Malaysia, which is

seeing in the industry and one that

M AY 2 0 2 0

119

is at the forefront of POKKA’s plans.

but the government needs to lead

“It’s one of the reasons why we’re

because currently it’s too difficult to

replacing our existing production lines

collaborate with your competitors.”

for PET bottles,” he says. “We aim to

Macaskill urges the need for a uni-

reduce the PET bottle weight by over

fied approach as lasting progress

20%. That’s a massive reduction in

cannot be made by working in silos.

the use of virgin resin to make those

“We can learn a lot from Japan’s com-

PET bottles, as well as the cost of the

mitment to quality; we need to be more

PET bottle. We’re also working with

standardised in our approach and

the government to improve recycling;

deliver the quality our customers in

that’s a supply chain topic that needs

Singapore, and beyond, are willing

to be addressed on a national level.

to pay for.”

I believe if we can do this properly, we can create a circular economy, w w w. s up p l y c h ain digi t a l . c o m

120

Motisun: supplying a diverse business portfolio in Africa WRITTEN BY

JOHN O’HANLON PRODUCED BY

JUSTIN BRAND

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MOTISUN GROUP

Motisun Group has grown to become one of Tanzania and Africa’s dominant conglomerates, achieving stellar growth and diversification

T 122

he port of Dar es Salaam, the ‘haven of peace’, is the gateway to eastern, central and southern Africa. The former Tanzanian

capital has an international airport, and rail links to the landlocked nations, including the Chinesefunded TAZARA linking it with Zambia’s Copper Belt and a planned 2,190-km railway to Rwanda, Burundi and the DRC. It is expanding to rival Mombasa and Djibouti as the country develops its industry and the port acclimatizes with the demand for container and bulk mineral export capacity.

Tanzania is not being left behind in Africa’s internet transformation. Dar es Salaam is connected to the rest of the world by all the major undersea cables that have been laid in recent years, including SEACOM and the Eastern Africa Submarine Cable System (EASSy). Other deepwater ports such as Pangani, Mtwara and Bagamoyo are being developed to take the pressure from Dar es Salaam and provide access for Panamax vessels.

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MOTISUN GROUP

Motisun: supplying a diverse business portfolio in Africa CLICK TO WATCH

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6:03

124

This vibrant city has been home

Sayona brand, as well as cabling and

to the Motisun Group since it was

plastic products of all kinds, distribut-

founded in 1992 by Subhash Patel. And,

ing them throughout Tanzania and

though it has grown to rank among

exporting them to all African markets.

the strongest business groups on the

It manufactures locally in some of those

continent, it remains a family concern.

markets. More recently, Motisun Group

It started with a small-scale steel plant

has been able to diversify into hospital-

with a single induction furnace and

ity, hotels, resorts and real estate.

rolling mill, but today MMI Steel Mills

A glance at the diversity of interests

produces more than 200,000MT of

reveals a complex logistics and sup-

steel a year. However, steel is only one

ply chain network. Key to the smooth

of many products the group produces.

running and cost management of this

It also manufactures paints, pipe,

network is the procurement depart-

beverages and juices sold under the

ment. Manoj Kumar is Head of Global

M AY 2 0 2 0

Procurement for Motisun, oversees

fruit juices, which are produced at

this vital part of the business from his

state of the art a new plant on a

office in Dar es Salaam and manages

40-acre site in the Mboga area,

a team of procurement professionals

Bagamoyo, which is 150 km from Dar

there in each of the businesses.

es Salaam.� The juices are prepared

The businesses are very diverse,

using fresh fruit sourced from Tanzania,

he says. “Under the Sayona brand,

and the beauty of this product is that

we diverse range of juices, carbonated

fresh fruit of the highest quality, such

soft drinks and packaged drinking

as mangos, pineapple, Guava and

water, and we started going into pure

Orange is available across Africa.

E XE CU T I VE PRO FI LE

Manoj Kumar A global leader, Manoj Kumar, has a successful history in supply chain management involving procurement, vendor management, material requirements planning & continuous process improvements in diverse industries like paint, chemical, steel, plastic, hospitality (food & beverage) in India, Tanzania and Africa.

In a career spanning more than 15 years, he has collaborated with teams to manage a wide range of procurement and supply chain processes consisting of assessment & transformation, warehouse management, vendor management/sourcing, risk management, value management/Value engineering, financial management, and been a key contributor to the development and implementation of continuous improvement initiatives. He has acquired expertise in analysing market activities to build into category strategies to minimise supply risk, drive competitive market advantage, augment productivity & increase operational efficiencies via implementation of standardised processes across all procurement areas.

w w w. s up p l y c h ain digi t a l . c o m

125

If raw materials for Sayona products

supply chain relies upon stockists with

are comparatively simple and reliable

warehouses all over Tanzania, from Dar

to source, the supply chain for the

es Salaam to Mwanza and Arusha to

paints produced under the Kiboko

Mtwara. No area is too remote.

brand is somewhat more complex.

“We have over 5,000 global suppliers

Only 30% of finished goods are

in our supply chain,” Kumar contin-

imported, the rest is manufactured in

ues. Chemicals for the factories are

high-capacity factories, backed by an

sourced via Dubai,South Africa, the

in-house resin & emulsion manufac-

USA and Europe, while much of the

turing plant. The Kiboko division can

steel required by MIIT’s plants comes

produce 50 tons of top-quality paint

from India. Accurate forecasting is

a day to satisfy the 60% share of the

required to keep costs in check and

Tanzanian market that Kiboko holds.

avoid waste. In the context of Africa it

Packaging and labelling are manufac-

is often not possible to achieve just-in-

tured at a separate facility. The onward

time sequencing of materials.

M AY 2 0 1 9

Sometime delays at the port con-

on the freeway. However, forecasting

gestion, fluctuations in availability and

gives manufacturing companies a

disruptions to the road and rail systems

leg-up on these elements of planning

have to be factored in with the rise and

and production cycles, companies can

fall of demand, making it necessary

operate with more agility, transparency,

to store enough raw materials at the

and flexibility to adapt to changing pro-

plants to ensure continuity of produc-

duction environments or schemes.”

tion. “Forecasting and planning always

Lead times are dependent on the

depend on market conditions,” says

location of the suppliers, he continues.

Kumar. “It’s a kind of rear-view mirror

Goods from Canada can take 90 days

approach, in that where you’ve been

by sea, whereas from Mumbai the time

can often help determine where you’re

from dispatch to clearance would be

going; but that does not necessarily

around 40 days. With reliable road and

help you avoid a multiple car accident

rail links, importing from South Africa is

“ Many of our vendors have been in place since the company was founded” — Manoj Kumar, Head of Global Procurement, Motisun

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127

MOTISUN GROUP

128

“ With wide experience and forecasting business planning exposure, we can manage our accounts, warehouse management inventory management and other key procurement functions” — Manoj Kumar, Head of Global Procurement, Motisun

much easier. “Coordinating supply to a

becomes more diverse as the product

particular plant requires a backup plan

portfolio is extended, which happens

that includes a number of pre-approved

almost daily.” The core software plat-

suppliers. Any disruption in availability

forms in use within the group are SAP

will disrupt the entire supply chain.”

and the versatile Tally ERP, originating

Kumar stresses that there’s real

in India. A phased programme of migra-

partnership between Motisun Group

tion is in place as individual businesses

and its suppliers. “Many of our vendors

integrate legacy programmes and

have been in place since the company

Excel-based practices. “With Tally’s

was founded, however the supply chain

accounting application we can manage

M AY 2 0 2 0

It is very exciting, though challenging, to be part of a continually expanding group that dominates the East African market in a number of key verticals, says Kumar. “Our Chairman, Subhash Patel, has a simple mantra: there are three ‘Ms’ at the core of any successful business, Money, Mindset and Manpower. Our people find this a great way to focus our minds on our work. Clearly no business can survive without having a firm hand on its finances; then it has to have a clear vision and finally a committed and competent workforce.” Patel is a person of vision, retaining his humility and empathy, despite being a figure of huge influence in Tanzania and the wider African business world, Kumar acknowledges. Under his leadership our accounts, warehouse management

the group is constantly diversifying

inventory management and other key

and adding new products to the exist-

procurement functions,” explains Kumar,

ing divisions. Kumar and his team are

adding that parts of the business are still

fully equipped to accept the challenge

used to the familiar Excel for budget-

of keeping these supplied with the

ing, preparing financial statements and

materials they need.

creating balance sheets. During the migration period, it is easy to import and export cash management information and financial data to and from Tally. w w w. s up p l y c h ain digi t a l . c o m

129

PROVIDING QUALITY AND SATISFACTION IN OIL AND GAS 130

M AY 2 0 2 0

WRITTEN BY

GEORGIA WILSON PRODUCED BY

K ANE WELLER

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PETRONASH

WE TAKE A CLOSER LOOK AT THE HISTORY OF THE OIL AND GAS COMPANY PETRONASH, THE PACKAGES AND SERVICES IT PROVIDES, AND ITS CSR COMMITMENTS

132

E

stablished in 2000, Petronash has been operating within the oil and gas industry for 20 years. Headquartered in Dubai,

Petronash prides itself on its core objectives and vision ‘to serve customers in the oil and gas industry best’ by providing ‘quality and customer satisfaction’.This is driven by the forethought and vision of the company’s management, who ensure that its infrastructure grows in parallel with rapid business expansion.

“We have built a high reputation, thanks to our advanced engineering and manufacturing capabilities and successful delivery of unique products to customers across the globe. We specialise in the manufacture of chemical injection systems, wellhead control panels and process equipment, with our flagship product being the ‘modular well site packages’,” says Petronash.

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133

2000

Year founded

$200mn Revenue in US dollars (2018)

1,000 Number of employees

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Excellence in valve manufacturing PetrolValves, established in Italy over 60 years ago, is a leading valve and actuator manufacturing company with more than 500 employees and a strong presence worldwide. Our production capabilities include some of the most sophisticated valves and actuators in the Oil and Gas industry.

Our manufacturing process leverages on the most exotic materials and innovative technologies. PetrolValves’ strategy has always focused on the development of customized products designed accordingly to our customers

specific needs that often require a high level of severity applications. The company’s continuous investment in new technologies, in the development of engineered solutions and specialized human capital has resulted in solid growth and ongoing success. PetrolValves has distinguished itself and gained prominence within this competitive industry over the years and keeps launching innovative products and New After Sales services to better serve it clients.

LEARN MORE

PETROlVALVES.COM

Driven by innovation: continuously pushing the boundaries of valve technologies.

sales@petrolvalves.it www.petrolvalves.com

PETRONASH

The company provides an array of after-sale services and world-class manufacturing facilities in Dubai, Houston and Dammam, where it has invested in state-of-the-art machinery and business process automation to become market leaders for its product portfolio. It expertly and creatively handles any technically challenging or complex projects, while maintaining a very safe and healthy workplace environment and embracing a zero accident culture.

136

Petronash: Corporate Video CLICK TO WATCH

M AY 2 0 2 0

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4:16

PETRONASH VISION

To establish itself as a global leader in providing specialised equipment to the oil and gas industry, and diversifying products which enhance oil and gas production and recovery.

137

PETRONASH PRODUCTS AND SERVICES

• Multi Compartmental Tank Packages

Chemical Injection Packages

• Solar Powered Chemical Injection •

This product package is designed to

• Chemical Injection For Sub-Zero

inject a precise and accurate amount of chemicals into a system, with the

WELLHEAD CONTROL PANELS

required back pressure both continu-

A pioneer in designing, manufacturing,

ously or intermittently to protect the

assembling and commissioning single-

mechanical integrity of the system

well, multi-well, RTO and PLC-based

from accelerated corrosion and

solar powered wellhead control panels

prevent scale formation and control

(WHCPs), Petronash provides produc-

hydrate formation.

tion fields for onshore, offshore and artificial islands.

Chemical injection packages include:

The business harnesses its

• Conventional Chemical Injection

know-how and proficiency with state-

• Multi Point Chemical Injection

of-the-art technologies to provide w w w. s up p l y c h ain digi t a l . c o m

Manufacturing executives drive better performance through

DIGITALIZATION at every level with EcoStruxure™ for Oil and Gas

Improve production, energy efficiency and safety with our loT-ready products, edge control, applications, analytics and services.

• Digital asset performance management • Integrated operations management • Integrated power, process, and safety management #WhatsYourBoldIdea View on demand webcast

Digitalization, the IoT and EcoStruxure™ for Oil, Gas and Petrochemicals EcoStruxure™ is Schneider Electric’s IoT-enabled system architecture that leverages digitalization and connected technologies to enable better decision-making and more profitable operations in industries all across the globe.

In the Oil & Gas industry, you’ll find our solutions helping improve operations and performance efficiency across the value chain in Onshore and Offshore production, in Pipeline Management and Terminal Distribution, as well as in LNG and Gas Processing facilities everywhere our valuable natural resources are found.

Reliability and safety Protect your plant from security risks through redundant architectures, distributed control systems, and insight and training for critical systems.

Schneider Electric is proud to be a trusted partner of Petronash in their solutions for the Oil and gas industry

Accelerated IoT connectivity Our information management solutions provide better outcome management, improved asset performance, and superior operations and execution.

Efficient day-to-day operations We empower simplicity to manage plant operations through ease of use, scalability, and secure, standards-based integration.

Integration of sustainability Ensure efficiency and sustainability by defining a clear strategy, implementing efficiency plans, and monitoring performance for optimized operations.

NEW! Power and Process convergence for design and operational efficiency Our integrated power and process architecture helps you reduce CapEx in the design phase of your project and OpEx in the operations phase for added value all throughout the project lifecycle. Integrated power and process also improves plant and personnel safety as well as overall plant and asset performance.

Our safety and control solutions run the world’s largest refinery.

We make 60% of global LNG production possible.

We help with 80% of the onshore production and operation markets.

We help refine 30% of the world’s crude oil.

Engineered in Germany, Manufactured in India Phoenix Mecano India Pvt. Ltd was set up in 1994 and is a part of globally operating Phoenix Mecano Group based out of Switzerland with strong German roots in engineering, manufacturing and solutioning. We develop and manufacture high-quality junction boxes, local control stations, distribution panels and integrated solutions which are certified according to the latest ATEX, IECEx, INMETRO, CCOE, TRTS/ EAC, UL certification and other international standards.

Our business success is founded on constant innovation and exceptional level of service. We have been developing ROSE products in collaboration with ROSE Germany, one of our flagship group company, for the last 25 years. Our focus is to provide customer specific solutions backed by our fully integrated state-of-the-art manufacturing facility located at Pune, India

Learn More www.phoenixmecano.co.in

packages for conventional designs

• Hydraulic Power Units

and programmable logic controller

• Misc Control Panels

solutions. In this area, it offers customers compact solutions to suit the

MODULAR WELLSITE PACKAGES

most complex process needs. Indeed,

Petronash also provides a Modular

Petronash states that all of its WHCPs

Wellsite Package. A skid-based unit

are “user-friendly in terms of oper-

containing all wellsite equipment and

ability, maintainability, availability and

components that can be fully integrated

reliability”.

and tested as one unit. These can be built for gas, oil and injection wells.

Wellhead control panel solutions include:

Petronash services

• Single Wellhead Control Panels

By harnessing the latest technologies

• Multi Wellhead Control Panels

and well trained professionals and cus-

• Ballast Control Panels

tomer service teams, Petronash strives

M AY 2 0 1 9

ensure they receive a quality service

PROVIDING LOCAL VALUE TO OPERATING COUNTRIES

and suitable spares on demand.

As part of its operations, Petronash

to handle any customer challenges to

strives to develop local skills, Services include:

transfer technology, use local man-

• Special tools and equipment

power and local manufacturing to

• Spares

build a workforce that is skilled and

• Product training

building a competitive supplier base.

• Product lifecycle support

With increased focus around the

• Installation and commissioning

world on developing local economies

• Special tools and equipment

and providing jobs to increasing

• Onsite testing and calibration

populations Petronash helps to

• Onsite flushing service

build capacity by creating SMEs 141

Petronash: Modular Wellsite Package CLICK TO WATCH

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0:15

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PETRONASH

as well as offering products and services locally.

Petronash is committed to ensuring that the success of the oil and gas industry brings benefits to the indiginous and national economies in those countries it operatesincluding Kazakhstan, Nigeria and India.

Petronash commitments: • Attracting local companies into all levels of its supply chain, sourcing competitive local goods, services 142

and skills that meet international industry standards • Engaging with local companies to source raw material, components and also local manufacturing • Working with partners and international suppliers to contribute to host country economies by sourcing locally, employing, training and developing nationals, and investing in local capacity • Regular engagement and communication with local suppliers to ensure transparency within the supply chain • Working effectively with its suppliers to improve overall performance throughout its supply chain M AY 2 0 2 0

“ W E HAVE BUILT A HIGH REPUTATION, THANKS TO OUR ADVANCED ENGINEERING AND MANUFACTURING CAPABILITIES AND SUCCESSFUL DELIVERY OF UNIQUE PRODUCTS” — Petronash

PETRONASH MISSION

To serve the strategic oil and gas markets worldwide, by relentlessly pursuing operational excellence, capacity expansion and investing in research and development.

Petronash is committed to timely delivery of high quality products which meet industry standards and customer specifications.

As well as fostering an environment of mutual trust and respect for employees and customers by allocating all necessary resources to turn its vision into reality.

As the business explains on its website: “Our commitment, supported by ethical and responsible business practices, will help us to achieve a sustainable and competitive local supply chain for Petronash, building futures in the countries where we operate.�

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