Business Chief Asia Pacific Magazine – December 2018

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Petro Rabigh SUPPLY CHAIN REVOLUTION

Transforming customer experience

City Focus

TOKYO

Developing a global digital hub through digital transformation Abdus Somad Arief discusses the development of Indonesia into Asia’s next digital powerhouse

Asia’s global business centre

TOP 10

Automotive manufacturers in Asia

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FOREWORD

W

elcome to the December Edition APAC edition of Business Chief.

Telkom Group is poised to capitalise on Indonesia’s burgeoning digital economy, seeing an opportunity to climb to the top of the emergent technological ecosystem whilst driving the country’s development into a Global Digital Hub. Dale Benton caught up with Abdus Somad Arief, Director of Wholesale and International Service, to find out more about Telkom’s ambitious transformation journey as it marches to the apex of the industry.

“We prepared for the inevitability of this digital wave of business around five years ago; now we are not only talking about connectivity and legacy business, we are looking at digital business,” says Somad Arief, outlining the firm’s strong market position for continued growth.

in the APAC region, with CEO David Hockley speaking to Olivia Minnock about the firm’s potent strategy for driving its expansion.

For this month’s City Focus, Japan’s iconic capital takes the spotlight as we examine Tokyo’s famous hotspots, biggest companies, and its preparations for the 2020 Olympic Games. In our Top 10 we take a look at the biggest automotive manufacturers in Asia and their impressive asset growths.

Finally, don’t miss out on our in-depth company profiles for Petro Rabigh, Shera Public, FWD Insurance, and Digital Realty.

Enjoy the issue!

Olivia Minnock.

Olivia.Minnock@bizclikmedia.com

British image-capture company Picsolve is also set for significant growth w w w. b u s i n e s s c h i e f. c o m

05

CONTENTS

10

Telkom Indonesia: transforming Indonesia into a Global Digital Hub

30 Spreadshirt simplicity is key amid its digital transformation Capturing the growing Asian market DECEMBER 2018

40

52

TOKYO City Focus

62 Auto Manufacturers in Asia w w w.busi ne ssc hief. com

CONTENTS

76 Transforming supply chain strategies at Petro Rabigh

108

Shera Public Company Limited

A digital transformation of

the customer experience DECEMBER 2018

124 FWD Insurance

Promoting engagement across the insurance sector

142 Digital Realty spearheading Sydney’s data centre market with digital disruption w w w.busi ne ssc hief. com

10

Telkom Indonesia: transforming Indonesia into a Global Digital Hub WRIT TEN BY

DA LE BENTON PRODUCED BY

K RIS TOFER PA LMER

DECEMBER 2018

TECHNOLOGY

11

w w w.busi ne ssc hief. com

PT TELKOM INDONESIA (PERSERO) TBK (TELKOM)

12

Identified as Asia’s next digital powerhouse, Telkom Indonesia will help make the nation a Global Digital Hub

A

s one of Asia’s foremost mobile-first nations, with close to 72% of internet

traffic originating from mobile devices and around 215mn internet users expected by 2020, Indonesia’s digital economy is one of incredible potential.

If unlocked, this potential will establish Indonesia as the biggest digital economy in South East Asia that is

DECEMBER 2018

TECHNOLOGY

13

projected to reach US$130bn in 2020.

Group). TelkomGroup is the biggest

Indonesia will be Asia’s next digital

digital telecommunications company

powerhouse.

in Indonesia. Today, it has embarked

Tasked with realising these predic-

on an ambitious transformation journey

tions and truly unlocking this potential

that will see the company become ‘the

are the major technology players in

king of digital in the region’ and ‘lead

Indonesia. One such company that

Indonesian digital innovation and

understands the key role it will play in

globalisation’.

redefining the landscape of Indonesia is Telkom with its subsidiaries (Telkom-

“A new digital era is upon us here in Indonesia,” says Abdus Somad Arief, w w w.busi ne ssc hief. com

TECHNOLOGY

CLICK TO WATCH : TELKOM COMPRO 2017 V.RUPS 2018

Director of Wholesale and International

ture in Indonesia to provide the best

Service of Telkom.

digital experience in this growing

“We prepared for the inevitability of

digital sphere. This will see the com-

this digital wave of business around

pany continue to develop new innova-

five years ago, now we are not only

tive products and services but also

talking about connectivity and legacy

strengthen the business ecosystem to

business, we are looking at digital

achieve sustainable growth in all digital

business. Our vision is to be at the

segments of the market. “We’ve built

very top of a digital ecosystem here

the biggest digital telecommunications

in Indonesia in which we will aggregate

infrastructure in Indonesia and we have

big and smaller players in Indonesia

already connected with fiber optic

and regional as well.”

everywhere,” says Somad Arief.

TelkomGroup also aims to strengthen the development of digital infrastruc-

TelkomGroup deploys around 160,680km of terrestrial and submaw w w.busi ne ssc hief. com

15

PT TELKOM INDONESIA (PERSERO) TBK (TELKOM)

16

“ Our vision is to be at the very top of a digital ecosystem here in Indonesia in which we will aggregate big and smaller players in Indonesia” — Abdus Somad Arief, Director of Wholesale and International Service, Telkom Indonesia

rine cable networks domestically and

Group’s network is also present in 33

globally including: a 'South East Asia

countries with 72 network Points of

– Middle East – Western Europe – 5'

Presence (PoP) that bring traffic and

(SEA-ME-WE 5) cable system, and

connect carriers with customers.

a 'South East Asia – United States'

TelkomGroup also operates a world-

(SEA-US) cable system. To connect

class neutral and internet exchange

the European, Asian and American

data centre called neuCentrIX, which

continents, the group is currently

aggregates service providers, network

building the Indonesia Global Gateway

providers and content providers from

(IGG) submarine cable system. Telkom-

all over the world to reach more than

DECEMBER 2018

TECHNOLOGY

17

E X E C U T I V E P R OF IL E

Abdus Somad Arief Abdus Somad Arief or familiarly called ASA has been with the company for 27 years and took over his role as CTO/CIO in December 2014. Since 21 April 2017 he has taken up a new assignment as the Director of Wholesale and International Services of Telkom. He has dedicated his life to working in the telecommunications industry and is passionate about his work.

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TECHNOLOGY

“ By leveraging digital culture and adopting the latest technologies, we try to inspire the people around us” — Abdus Somad Arief, Director of Wholesale and International Service, Telkom Indonesia

be easy to forget that for all the innovative technologies that the world has to offer, it means little if people lack the right capabilities to utilise them. This is something that the digital ecosystem helps TelkomGroup address first hand, equipping both the company’s employees and customers with the necessary understanding required to fully capitalise on the opportunity and value of this digital culture.

“Through the ecosystem and working with international partners, we are given access to the latest technologies that are transforming industries all over the world,” says Somad Arief. “It allows us

265mn Indonesian people through a

to prepare for the technology of today

seamless, secure and reliable network

and the technology of tomorrow.

to drive the growth of the global digital industry.

Though TelkomGroup’s digital

“By leveraging digital culture and adopting the latest technologies, we try to inspire the people around us,”

infrastructure, Somad Arief recognis-

he adds. “As a group, we are then more

es that the company has played, and

aware of the services and technologies

will continue to play, a huge role in

that are coming, be it robotic technol-

enabling this digital economy by

ogy or Artificial Intelligence (AI). It

bringing out national capabilities while

means we don’t reach too far where

leveraging outside capabilities to truly

we can’t go but we are aware of what’s

build the nation.

coming and can prepare our people

On TelkomGroup’s journey to establish Indonesia as a global digital hub, it can

for these technologies of the future.”

Digital transformations often require w w w.busi ne ssc hief. com

19

PT TELKOM INDONESIA (PERSERO) TBK (TELKOM)

SHM

MOS MAN LON DUB PRS

EIG

LUX

MRS

MDR

AMS FRA SWI

MLN PAL

LSB

WRS KIV VNA SOF SEO

IST

TYO SHA

20

ALG

CAI

ND

RGN

SJC

BKK HAN

IMEWE BBG SEA-ME-WE 5 SEA-ME-WE

DUM 4 BTM

SG

JKT

BSW

SBYDPS

IGG JHB

DECEMBER 2018

APCN-2

TWN

MAC DUB

DJI

SHI

HKG

RYD

C2C

DVO MDO

DIL

TECHNOLOGY

SJ

TOR CHG

JUS

NYX

UNITY

SLO

LAX

ASH

FASTER TNG-IA

HWI

21

AAG

GUA

SEA-US

“ TelkomGroup deploys around 160,680km of terrestrial and submarine cable networks domestically and globally including South East 'Asia – Middle East – Western Europe – 5' (SEAME-WE 5) cable system and a 'South East Asia United States' (SEA-US) cable system. To connect the European,Asian, and American continents, currently we are building Indonesia Global Gateway (IGG) submarine cable system”

SP

— Abdus Somad Arief, Director of Wholesale and International Service, Telkom Indonesia

w w w.busi ne ssc hief. com

BUILDING A FULLY CONNECTED,

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Huawei’s end-to-end portfolio of products, solutions and services are both competitive and secure. Through open collaboration with ecosystem

partners, we create lasting value for our customers, working to empower people, enrich home life, and inspire innovation in organizations of all shapes and sizes.

At Huawei, innovation focuses on customer needs. We invest heavily in basic research, concentrating on technological breakthroughs that drive the world forward. We have more than 180,000 employees, and we operate in more than 170 countries and regions.

Founded in 1987, Huawei is a private company fully owned by its employees.

FIND OUT MORE HERE

TECHNOLOGY

23

a change in culture and process.

exemplified best by the company’s

Even for the largest telecommunica-

Global Talent Program. Somad Arief

tions provider, this is no different – but

explains: “We send our people out to

attempting to adopt a new operating

our subsidiaries in over 11 countries

model into a business that has

and we do so with the purpose of

been incredibly successful can prove

training them directly in the field.

difficult. Nevertheless, Somad Arief

“It gives them practical knowledge

points to an intense focus on cultural

and skills in digital business but

change within the company that

looking more internally, we also have

overcomes this challenge. This is

an initiative designed to nurture the w w w.busi ne ssc hief. com

PT TELKOM INDONESIA (PERSERO) TBK (TELKOM)

24

creative millennial employees because

businesses to contribute to Indonesia’s

they are growing to be the leaders of

digital economy. Through this program,

the future.”

TelkomGroup inspires employees to

This initiative is called the Digital

collaborate and provides them a true

Amoeba programme. Launched in 2017,

platform to think differently, ultimately

the program was designed to incubate

incubating those ideas and incorpo-

and accelerate ideas (digital innova-

rating them into the market through

tion) from Telkom employees in order

new services and products.

to create digital talents and digital DECEMBER 2018

TelkomGroup’s core mission is one of

TECHNOLOGY

25

“We also have an initiative designed to nurture the creative millennial employees because they are growing to be the leaders of the future” — Abdus Somad Arief, Director of Wholesale and International Service, Telkom Indonesia

w w w.busi ne ssc hief. com

PT TELKOM INDONESIA (PERSERO) TBK (TELKOM)

26

DECEMBER 2018

TECHNOLOGY

$1.37trn Approximate revenue

(September — 2018)

1965

Year founded

24,065

Approximate number of employees (TelkomGroup — 2017)

27

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PT TELKOM INDONESIA (PERSERO) TBK (TELKOM)

transformation and development which prepares for and stays ahead of the growing digital economy of Indonesia.

As a matter of fact, the company’s vision of becoming the ‘King of Digital in the Region’ will see TelkomGroup become the top 10 market capitalisation telco in Asia-Pacific by 2020. This is a relatively short timeframe but Somad Arief believes that 2018 will go down in the company’s history as a crucial year. “This year has been our initial year as we began our journey to 28

creating this global digital hub and it’s the year in which we aggressively built the digital infrastructure,” he says. “But of course, the infrastructure is only the foundation. Now it’s time to build on that foundation and fill the ecosystem.

“Our immediate goal is to complete our connectivity infrastructure through our data centres. We have 11 in Indonesia, but the Group has five across Singapore, Hong Kong and Timor Leste which are seamlessly connected. So, for us, 2019 is the time to fill this infrastructure with the players and to begin this ecosystem of collaboration.” The presence of neucentrIX as a neutral data centre and internet exchange and DECEMBER 2018

TECHNOLOGY

“The infrastructure is only the foundation.

Now it’s time to build on that foundation and fill the ecosystem” — Abdus Somad Arief, Director of Wholesale and International Service, Telkom Indonesia

other infrastructures such as submarine cables system, PoP, satellites, along with the development of digital society, is expected to not only drive the digital economy in Indonesia but also make a global impact. Through digital transformation, TelkomGroup is building Indonesia up as a centre of digital business in the Asia Pacific region to become a true Global Digital Hub.

w w w.busi ne ssc hief. com

29

LEADERSHIP

Capturing the growing Asian market 30

Picsolve CEO, David Hockley, explains why Asia is forming a key part of the entertainment technology business’ aggressive growth strategy WRITTEN BY

OLIVIA MINNOCK

DECEMBER 2018

31

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LEADERSHIP

32

E

xperiences are an increasingly

to the moment. The UK-based con-

valuable commodity, as across

tent capture provider has a presence

Asia wealthier middle classes

across Europe, the US, the Middle East

begin to emerge, spending disposable

and Asia – with the latter, as CEO David

income on leisure. Theme parks,

Hockley explains, forming a vital part

one-off events, attractions and amuse-

of Picsolve’s ambitious growth strategy.

ments are growing worldwide, and the

Hockley joined Picsolve as CFO in

Asian continent is no exception.

Nowadays, the excitement of an

2016, before being officially named CEO in February of this year. He boasts

event lasts long after it is over, as pho-

a lengthy career in the entertainment

tos and videos capture moments and

industry, including roles at the Finan-

enable visitors to share them far and

cial Times and CFO of Channel 5. “I

wide on social media, and Picsolve

worked for the Financial Times in Hong

is the company bringing more power

Kong,” he recalls. “I was there in 1995-

DECEMBER 2018

1997 when we started printing the Asia edition locally – perhaps that’s where my love of Asia comes from.” Hockley was brought in as CFO at Picsolve to financially manage the organisation’s national growth, but since becoming CEO he has laid out an ambitious strategy for further expansion.

This strategy will be three-fold: to develop the company’s technology offering; to expand Picsolve’s international reach, particularly in Asia; and to diversify the sectors the company

“ By 2021, more money – and probably more visitors – will be going into theme parks in China than is currently the case in America” — David Hockley, CEO, Picsolve

operates in – while the current focus is on theme parks, observation towers

33

and attractions, the goal is to move into the likes of cruise ships, ski resorts and sports stadia. It’s clear there are many untapped sectors in which Picsolve can thrive.

The ongoing march of social media – and particularly photo-sharing platforms like Instagram – has shown that the kind of moment capture Picsolve has to offer is in hot demand. “We all know the selfie is fairly omnipresent,” says Hockley, “but some of the products and experiences we’ve developed go way beyond that – there’s a huge opportunity there, not just for the young demographic but for everyone.” w w w.busi ne ssc hief. com

LEADERSHIP

The company has recently set up an office in Hong Kong – to add to its bases in the UK, US and UAE – with

well as growing organically.

In October, the company made a deal

local employees benefiting from expe-

with visitor attraction operator Merlin

rienced international staff. “We’ve got

Entertainments to become its sole con-

a permanent establishment of employ-

tent capture supplier in China, meaning

ees, including experienced people who

Merlin’s attractions will utilise Picsolve’s

have worked within Picsolve and the

green screen and grey screen technol-

entertainment industry for a long time

ogy as well as its patented Experience

to help with retail operations and tech-

Wall. “We’re working with Merlin at the

nology engineering.

Shanghai Dungeon, Peppa Pig World in

“It’s vital to be able to demonstrate

34

Picsolve looks to build relationships as

Shanghai and Beijing, LEGOLAND Dis-

to our partners that we have the infra-

covery Centre Beijing and Little Big

structure, are investing in the region and

City Beijing. A number of these will

are growing our understanding of how

be fully staffed by Picsolve people,”

the region operates,” he adds. Partner-

says Hockley.

ships, of course, are key when entering new markets, especially in China where

“ With Madame Tussauds in Shanghai and Bangkok, we will deploy our Experience Walls which we already have in London – they can display multiple forms of content,in front of which you have your camera” — David Hockley, CEO, Picsolve

DECEMBER 2018

The company is also strongly established in Hong Kong as well as enter-

CLICK TO WATCH : PICSOLVE: EXPERIENCE WALL 35 tainment capital Macau, and is keenly

Asia and the Middle East – Hockley

eyeing Southeast Asia. “We have some

says within three years, the goal is to

presence in Thailand and some opera-

increase this to one-third.

tions in Singapore. There are a few lo-

With some economies emerging

cations I want to expand into as there’s

as famously mobile-centric, technol-

a large tourist market in Southeast

ogy is something Asian consumers take

Asia. That’s where we’ll probably look

very seriously and as such, consumers

to work with partners as we don’t have

in Picsolve’s markets like China and

a lot of local infrastructure.

Thailand have high expectations. “With

“Japan is a market we’re looking at how

Madame Tussauds in Shanghai and

best to serve as we grow,” he continues.

Bangkok, we will deploy our Experi-

“We’ve got a couple of sites with Merlin

ence Walls which we already have

in Japan but we’re also identifying other

in London – they can display multiple

potential partners.” At present, around

forms of content, in front of which you

12% of Picsolve’s revenue comes from

have your camera. It’s a very innovative w w w.busi ne ssc hief. com

LEADERSHIP

36 and popular product.” Indeed, Picsolve

descent. “Some customers in Asia are

acquired the maker of the Experience

looking to deploy this,” says Hockley.

Wall, Freeze Frame, in September 2017

“We’re hoping it will capture the enjoy-

as part of its technology growth strat-

ment and entertainment when you go

egy. Further, a deal with Studio City

head first down a zipline.” This is cer-

in Macau will see Picsolve deploying

tainly something consumers can’t do

its Super Selfie offering, which comes

with their own smartphone.

from another strategic partnership with Panora.me.

As the business diversifies, a par-

Another technology focus revolves around payment options. Picsolve works to offer customers the option to

ticularly lucrative technology develop-

pay before, during or after an experi-

ment for certain amusements will be

ence, based on how a particular partner

zip wires, a product which involves a

operates – after all, Picsolve does not

camera set up at the end of a zip wire

sell itself as a brand, but a tool allowing

to create slow motion footage of a

its partners’ brands to develop and inte-

DECEMBER 2018

“ It’s vital to be able to demonstrate to our partners that we have the infrastructure and are investing in the region” — David Hockley, CEO, Picsolve

37 grate within their systems and interfaces.

“In China, WeChat is omnipresent – I

By recognising which prevalent technologies offer the best opportuni-

suspect that over 90% of financial

ties, Picsolve can offer a tailored

transactions go through WeChat and

service to the brands and consumers

utilising that as a payment mechanism

around the world. Through key

is absolutely imperative. 94% of

partnerships, Picsolve will continue to

Chinese WeChat users have the app

foster growth and ensure it expands its

open every day – this is something we

footprint within the fast-growing Asian

just don’t see in Europe. It opens up an

market. “By 2021, more money – and

opportunity for us: if we integrate both

probably more visitors – will be going

with our partners and utilise the

into theme parks in China than is

WeChat payment mechanism, it

currently the case in America,” Hockley

provides a much more consistent way

predicts. “That’s obviously a period of

of interacting with Chinese customers,”

growth we’ve got to tap into.”

Hockley explains. w w w.busi ne ssc hief. com

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TECHNOLOGY

40

Spreadshirt

simplicity is key amid its digital transformation AS TECH ADVANCES, KEEPING THINGS SIMPLE CAN DRIVE EFFICIENCY AND HEIGHTEN CUSTOMER EXPERIENCE, SAYS PHILIP ROOKE, CEO OF GLOBAL ECOMMERCE COMPANY SPREADSHIRT WRITTEN BY

DECEMBER 2018

OLIVIA MINNOCK

41

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TECHNOLOGY

F

rom promoting snappy slogans and allowing people to create to helping entrepreneurs and small businesses

thrive, global self-expression company Spreadshirt made its name as a European

T-shirt printer, but is now fast becoming a much more diverse, global entity. When we last spoke to CEO Philip Rooke, the company was just starting to expand in the US. Now, it has reached over €100mn revenue thanks in part to this new market and is looking to optimise efficiency and stick to its customer centric vision in order to help the European business grow in uncertain times where 42

productivity is ever more important.

“The majority of our business is European,” says Rooke. “That’s what drove us over €100mn (US$114mn) revenue.” Last year, Spreadshirt reached €106mn (US$121mn) in revenue, making €8.6mn (US$9.8mn) EBITDA. “This probably makes us the most profitable in our industry, and that’s because we’re able to concentrate on the right things.”

For Spreadshirt, the US marks a mammoth opportunity, but the region is not without its challenges. “America is a huge market – the average American buys 9.4 T-shirts per year, while the average German buys 4.5,” Rooke explains. “More importantly, in most European countries we have three DECEMBER 2018

43

“American companies are very good at being lean, agile and customer focused” — Philip Rooke, CEO, Spreadshirt

or four competitors – and are nearly always number one – but in America we’re tracking 200 companies to compete with.” In this relatively new territory, Spreadshirt must step up to the plate and enhance customer experience for the modern, tech-savvy consumer. “Americans are not very patient,” Rooke observes. “If your usability is poor, they leave for a competitor. We really had to work on getting the experience much simpler.

“American companies are very good at being lean, agile and customer focused,” he adds.

As such, a key transformation Spreadshirt has implemented, not only in the US but w w w.busi ne ssc hief. com

TECHNOLOGY

throughout its business, is to simplify

our customers do that in their spare

everything from production processes

time? I look with horror at how much

to its user platforms – not least mobile,

money I’ve spent on Amazon recently

which is important to nail down since

– most of it on mobile as it’s so simple,”

55% of Spreadshirt’s traffic last year

he adds.

was mobile. “With a lot of ecommerce,

Now, all development of the ecom-

all the browsing takes place on buses

merce platform happens mobile first,

or in bars when people are on the move

forcing the business to

or have a spare moment.

ensure the experience is

“By concentrating on mobile, it forces

44

as simple as possible.

you to simplify the consumer’s journey

“You can always imagine

so they can not only browse but easily

extra features, but they

buy on mobile. Is the platform simple

can make it harder

enough to create your own T-shirt or

to use. Every feature and

browse the creations of others? Can

function must be simplified,

DECEMBER 2018

right down to marketing communication

Coupled with the number of markets

because you can’t write two paragraphs

it operates across, Spreadshirt in

on why a premium T-shirt is better than a

2018 is in many ways a complex beast

normal one – nobody’s going to read that

in which, as Rooke puts it, “there are

on mobile. It forces everyone from web

10,000 things that could go wrong.” This

designers to purchasing and assortment

in itself has forced Rooke to simplify his

teams to simplify.

own outlook and that of his leadership

“Five or 10 years ago, the more

team. “There’s no way to manage all

features you added the more exciting it

that end to end – I’d go crazy. So, over

was, but now people want to achieve

the past couple of years, there’s been

tasks really simply and as such the

a big shift in how we manage the

80/20 rule is cutting back in,” adds

business.

Rooke. “You have to concentrate on what 20% of features, stocks, offering,

“I don’t manage or oversee all elements – I’ve employed people who are a lot

makes up 80% of your business.”

45

Across the board, from mobile ecommerce to the factory floor, digital transformation is certainly “forcing a lot of simplification,” according to Rooke.

This is especially challenging for Spreadshirt when its business model is anything but

“Five or 10 years ago, the more features you added the more exciting it was, but now people want to achieve tasks really simply” — Philip Rooke, CEO, Spreadshirt

simple – it has several businesses within it including people who sell on Amazon, directly to market, or create and buy their own items. w w w.busi ne ssc hief. com

TECHNOLOGY

better than me,” he explains. “People used to write reports and ask for approval on what they were doing, but now we say ‘if you can turn this around, we don’t really care what you’re doing – we care what results you’re achieving.’”

Spreadshirt now uses a system called Objectives and Key Results (OKR), which is used by the likes of Google and LinkedIn, to empower various teams. Objectives for the quarter are agreed among directors and it’s up to individuals and teams to go away and achieve these however they see fit.

46

“That’s the only way to manage a complex international business,” says Rooke.

OKR allows empowerment to run right through the business. “People take responsibility. They care. They like the freedom of being able to think about how they can do things differently. Teams and individuals can really take ownership of what they’re doing.”

This is vital when as CEO, Rooke lives on a different continent to some of his teams and might only see them a few times a year. Having trust and empowerment in place means C-level executives have their time freed up to communicate where it matters. “When I’m talking to the Las Vegas factory, I’m DECEMBER 2018

“In the past, we thought things were clever if they were complex.

But actually, if someone can work out how to make something complex simpler – that’s the cleverest thing” — Philip Rooke, CEO, Spreadshirt

47

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TECHNOLOGY

48

DECEMBER 2018

talking about quality and cost improvements and why they matter – before, I was worrying about processes.

“We’ve abandoned nearly all the internal reporting – with the OKR system, and daily reports that show the KPIs that come out, it’s so much simpler and there’s less red tape. The whole mantra is around simplicity – trying to achieve something in a quarter is the simplest way to move it forward. People get rid of the big, complex ideas and brainstorm how to do things in a more complex way.

We celebrate that at Spreadshirt. In the past, we thought things were clever if they were complex,” Rooke adds, “But actually if someone can work out how to make something complex much simpler – that’s the cleverest thing.”

w w w.busi ne ssc hief. com

49

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CITY FOCUS

TOK City Focus

52

DECEMBER 2018

KYO

Business Chief explores all Tokyo has to offer, and how the city is prioritising tourism ahead of the 2020 Olympics WRITTEN BY

SEAN GALEA-PACE

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53

CITY FOCUS | TOKYO

54

A

s the capital of Japan and the world’s most populous metropolis, Tokyo offers its visitors an opportunity to take in the hustle and bustle

of city life, explore its relaxing gardens or experience its local delicacies such as its famous seafood market – and nowadays, the global powerhouse is making the tourism sector its key priority ahead of the upcoming 2020 Olympics.

A WORLD FAMOUS FISH MARKET Tokyo is synonymous with fresh seafood on sale in the streets of the city and holds the title of the world’s largest fish market, as well as being home to the world’s biggest wholesale food market of any kind since the launch of the Toyosu Market in early October.

Toyosu Market replaced the historic and popular Tsukiji market after 83 years in operation and is 1.8 times bigger

DECEMBER 2018

Hamarikyu Gardens in Tokyo.

The new Toyosu wholesale market.

‘ Toyosu Market replaced the historic and popular Tsukiji market after 83 years in operation and is 1.8 times bigger than Tsukiji’

than Tsukiji, according to CNN Travel.

$17.8mn per day. According to CNN

The market is thought to have cost

Travel, Hiromi Amino, CEO of a major

around $5bn to build and covers

Toyosu market wholesaler, said at the

407,000 sq m.

launch of the new market: “Today’s a

Indeed, Tokyo’s fish industry is worth

fresh start for us. We’ll unite to develop

approximately $3.8bn annually. Each

this market and earn the clients’ trust.

day, over 2,800 tonnes of fish and

At the end of the day, we would like to

vegetables are traded within the city, amounting to a value of

build the brand of Toyosu to go beyond Tsukiji for the next century.” w w w.busi ne ssc hief. com

55

CITY FOCUS | TOKYO

The Asahi Breweries Beer Hall, designed by Philippe Starck

56

BIG BUSINESS IN TOKYO

such as in IT, automotive, engineering,

One of the richest and most developed

communications, electronics, banking

countries in the world, Japan has a vast

and retail. With Tokyo being the busiest

number of global companies operating

city in the country, a number of global

across a variety of different sectors

giants hold their headquarters there.

Shibuya Crossing, one of the busiest crosswalks in the world.

DECEMBER 2018

BIG BUSINESS

Japan Post Holdings Boasting a revenue of $129.7bn, Japan Post Holdings has over 24,000 offices and more than 400,000 employees.

With headquarters in Tokyo, the company primarily operates as a postal and logistics business. It also provides letters and goods transportation services, stamp sales, loans, deposits and insurance products.

Hitachi Recognised as being Japan’s top technology company by revenue, Hitachi has established global recognition too as it sits seventh worldwide with $89.3bn. The company primarily manufactures electronic and electrical equipment and has over 300,000 employees as of March 2018. Hitachi is also ranked on the Forbes 2000 list and currently sit 149th.

Honda The automotive giants operate at a revenue of US$128.4bn (14.6trn yen) and has over 180,000 employees.

Honda has been the world’s largest motorcycle manufacturer since 1959 and is the seventh largest automotive manufacturer in the world. w w w.busi ne ssc hief. com

57

CITY FOCUS | TOKYO

‘ Tokyo has over 102 train lines that serve around 14bn passengers a year’

58

Shinkansen, or Bullet train, passing the world renowned Mt. Fuji

A LEADER IN RAIL TRAVEL

year. The city has a number of different

The city is renowned for possessing

rail options such as traditional trains,

the most extensive urban railway net-

subways and also the Shinkansen

work in the world. According to CNN

which is a Bullet Train that operates

Travel, Tokyo has over 102 train lines

at speeds of up to 200mph.

serving around 14bn passengers a DECEMBER 2018

Although the capital city of Japan

Tokyo Station in the Marunouchi district

59

and a major international hub, planes have been forbidden from flying over Tokyo since World War II. As a result, the major airport to visitors to Japan is Narita International Airport, approximately 37 miles away from central Tokyo. w w w.busi ne ssc hief. com

CITY FOCUS | TOKYO

Shimbashi District is well known for its entertainment and nighlife 60

A GROWING TOURISM INDUSTRY The city offers a diverse choice of shopping, entertainment, culture and dining options for tourists to explore.

Since Tokyo was awarded the 2020 Olympics, the Japan National Tourism Organisation

Currency

YEN 1869

Year of independance

(JNTO) is aiming to increase tourism in the country to 40mn by 2020, according to Skift.

The JNTO has launched a campaign to promote lesser-known attractions in the country

13.8

Population

which is being aided through TV adverts and online promotions. In a report by McKinsey entitled ‘The Future of Japan’s Tourism: Path for Sustainable Growth towards 2020’, it was noted: “Given the exponential growth in tourism income, the Japanese government DECEMBER 2018

Nearest airport

6km

Narita International Airport

recognises that inbound tourism could be an important engine of economic growth and regional revitalisation.”

The country has already seen an increase in visitor numbers of 33% from 2011 to 2015 and with an approximate 28.7mn visitors. In 2017, Japan hopes to see those figures significantly increase further before the 2020 Olympics gets underway. Tokyo is home to the tallest tower in the world, the Tokyo Skytree, which reaches a full height of 634m (2,080ft) when it was unveiled in 2011. The Skytree is second only to Dubai’s Burj Khalifa as the tall-

The Senso-ji Temple and Tokyo Skytree at twilight in Japan.

est structure in the world.

The Torii gate at the entrance to the Meiji shrine in Yoyogi Park, Tokyo.

Despite being a built-up city with a population of over 9.2mn, Tokyo possesses beautiful gardens such as the Hamarikyu Gardens, Kiyosumi Garden and Mukojima-Hyakkaen Garden. With a pond in the middle of each, these locations offer visitors the perfect chance to relax and embrace Japanese culture.

Just outside the city are nine small islands for tourists to visit. Each of the Tokyo Islands offers a different experience including a volcanic landscape, swimming, beaches and forest walks,

The weekly ferry ship in the port of Futami, Ogasawara and elevated view from Mt. Yoake (307m) over the beautiful Ogaswara Islands, one of Japan´s UNESCO world heritage sites.

providing a getaway from the busy city life in central Tokyo. w w w.busi ne ssc hief. com

61

T O P 10

62

Auto Manufacturers in Asia We take a look at the top 10 largest auto manufacturers in Asia based on the Forbes Global 2000 rankings Wri tten By

DECEMBER 2018

Harry Menear

63

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T O P 10

64

10

Subaru Tokyo-based Japanese car manufacturer, Subaru, trades under Fuji Heavy Industries Ltd. The company manufactures and sells automobiles, aircraft, engine parts and industrial machines. This includes automotive brand Subaru, which experienced all-time record high sales in the United States in the third quarter of 2018, reporting a 5.1% growth in sales year on year. Fuji Heavy Industries currently controls $21.7bn in assets, representing an almost $5bn increase year on year.

www.subaru.com

DECEMBER 2018

65

09

Suzuki The Suzuki Motor Corp. is headquartered in Hamamatsu, Japan, and works across research, development, manufacturing, sale and distribution of motorcycles and cars as well as commercial vehicles and special machinery. As of 2018, the company controls $31.4bn in assets, representing a $5.5bn increase year on year. In October 2018, Suzuki Motor Corp. launched its most popular model, the Swift, in Myanmar. In the past year, Myanmar’s new car sales doubled, according to the Nikkei Asian Review which stated Suzuki is “hoping to replicate its dominance in India by establishing a firm foothold in the country”.

www.globalsuzuki.com

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T O P 10

66

08

Dongfeng Motor Group Based in Wuhan, the Dongfeng Motor Group manufactures and sells commercial and passenger vehicles, as well as engine parts for those products, according to Forbes. Founded in 2001, it is the youngest company in the top 10 list. As of 2018, the Dongfeng Motor Group controls $32.6bn in assets, marking an increase of almost 400% in comparison to 2008. The company also reported record high profits of $2.1bn, although net sales did decrease by $1.7bn in comparison with 2016. With over 146,000 members of staff, the Dongfeng Motor Group is the second largest employer on our list.

www.dongfeng-global.com

DECEMBER 2018

67

07

Tata Motors Mumbai based automotive manufacturer Tata Motors is the largest Indian producer of commercial and passenger vehicles, and controls the fourth largest share of the passenger vehicle market in India, according to the India Times. The company reported a total asset portfolio of $44.6bn for 2018, representing year-on-year growth of $5.1bn. Tata Motors also reported net sales of $43bn last year, representing a 10-year high point for the company.

www.tatamotors.com

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T O P 10

68

06

KIA Motors The Kia Motors Corp. is based in the South Korean capital, Seoul, and engages in the manufacture and sale of passenger, commercial and recreational vehicles. The company is also involved in leasing, vehicle maintenance and automobile parts. In 2018, KIA reported an asset portfolio totaling $49.6bn, representing a year-on-year growth of $7.5bn. Additionally, annual sales increased by $2.5bn, up to a 10-year high of $47.9bn. According to Shepherd Media, KIA is also ramping up production of its light armoured vehicles under a renewed contract with the South Korean Army.

www.kia.com/uk

DECEMBER 2018

69

05

SAIC Motor Shanghai-based auto manufacturer SAIC Motor Corp. Ltd. engages in the development, manufacturing, and sale of automobiles and automotive parts. The company is the largest Chinese car manufacturer. According to the South China Morning Post, SAIC experienced “its best year in 2017, increasing sales by 6.8% to 6.93mn, more than double the Chinese automotive industry’s average growth pace.”

Sales in 2018 rose again by $23.9bn, to a 10-year high of $136.6bn.

The company’s asset portfolio also grew by $33.4bn, to a total of $118.4bn, the largest proportional asset growth in the Top 10.

www.saicmotor.com

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T O P 10

70

04

Hyundai Motor Based in Seoul, the Hyundai Motor Co. Ltd. is South Korea’s largest manufacturer and distributor of motor vehicles and parts, according to Forbes. The company was previously the third largest distributor of cars in China, prior to diplomatic tensions between Seoul and Beijing causing a drop in demand for South Korean products in China.

Currently, “Hyundai is considering (exporting China-made vehicles) to emerging markets such as Southeast Asia,” according to a Reuters report. While year on year profits have decreased since 2014, at an average of $1.5bn per year, Hyundai’s asset portfolio continues to grow, in line with the rest of the Asian market. In 2018, the company’s total assets were valued by Forbes at $164.7bn.

www.hyundai.com

DECEMBER 2018

71

03

Nissan Motor Co. Headquartered in Yokohama, the Nissan Motor Co. Ltd. produces, distributes and sells automobiles and automotive parts as well as marine equipment. The company announced plans in June to increase its share in the Indian car market from its current 1.6% to 5% by 2020. This growth is expected to offset slight decreases in the European car market, where the company’s sales have dropped from 58,301 units to 56,234 annually. This year, Nissan Motor has experienced its highest profit growth in 10 years, with net earnings rising from $4.5bn to $7.4bn. Its asset portfolio also grew to $173.7bn.

www.nissan-global.com

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T O P 10

02

Honda Motor Co. The Honda Motor Co. Ltd. is based in Tokyo and engages in the manufacture and sale of cars, motorbikes and power products. The company controls a total asset w$20.1bn growth year on year. Profits more than doubled in 2018, rising from $3.9bn to $9.6bn, the largest proportional profit growth in the Top 10. In October, Honda announced its partnership with General Motors’ autonomous vehicle unit, GM Cruise, pledging to invest $2.75bn into the further development of self-driving vehicles.

www.honda.co.uk

72

DECEMBER 2018

CLICK TO WATCH : HONDA PARTNERS WITH GM ONN THE GM CRUISE 73

w w w.busi ne ssc hief. com

T O P 10

01

Toyota Motor Corp.

Headquartered in its namesake city, the Toyota Motor Corp. is Asia’s largest car manufacturer measured by asset portfolio, sales and profits. Toyota holds almost 50% of the market share in Japan and 15% in the US. The company’s asset portfolio grew by $60.5bn year on year in 2017/18, along with consistent growth in sales to $15.1bn and profits to $5.4bn. Unlike Honda, which is seeking overseas expertise in the development of autonomous vehicles, 74

Toyota announced in October its plan to partner with Japanese tech giant SoftBank. Reuters reported that the two companies aim to “jointly develop a platform to operate self-driving vehicles which can be used as mobile shops, hospitals and other services as they envision a future in which fewer people drive their own vehicles”.

www.toyota.co.uk

DECEMBER 2018

CLICK TO WATCH : HIGHLIGHTS FROM TOYOTA CONNECTED DAY 2018 75

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76

DECEMBER 2018

S U P P LY C H A I N

Transforming supply chain strategies at Petro Rabigh WRIT TEN BY

SE AN GA LE A-PACE PRODUCED BY

HE Y K EL OUNI

77

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PETRO RABIGH

Michael Gustafson, General Manager of Material, Procurement and Contracts discusses the procurement methods that Petro Rabigh is utilising through significant change in Saudi Arabia

78

I

n a country driven by change amidst the incoming Saudi Vision 2030, companies in Saudi Arabia have an obligation to

adapt to and embrace the latest trends in order to thrive in a competitive petrochemical industry.

With ambitions of becoming one of the most profitable refinery and petrochemical plants in the world, Petro Rabigh knows first-hand just how vital the next few years are to the future of Saudi Arabian businesses.

Originally formed in 2005 as part of a joint venture between Saudi Aramco and Sumitomo Chemical, Petro Rabigh produces 18.4mn tons per annum (mtpa) of petroleum-based products and 2.4mtpa of ethylene and propylene-based derivatives.

With the plant’s Phase I and recently launched Phase II together valued in the region of $20bn, Michael Gustafson, General Manager of Material, Procurement and Contracts, believes that these DECEMBER 2018

S U P P LY C H A I N

“ We have two incredible foundation partners in Saudi Aramco and Sumitomo Chemical; a terrific partnership with aligned goals that have brought the strengths and diversity of two great organisations into this project” — Michael Gustafson General Manager of Material, Procurement and Contracts

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79

PETRO RABIGH

foundation partners laid the ground

MAINTAINING PROCUREMENT STRATEGIES

work for the company’s success.

As a way of affirming Petro Rabigh’s

“We have two incredible foundation

80

commitment to the Saudi Vision, the

partners in Saudi Aramco and Sumi-

company has confirmed the imminent

tomo Chemical; a terrific partnership

arrival of The Petro Rabigh Phase II

with aligned goals that have brought

expansion project, which provides an

the strengths and diversity of two

even more diversified product slate

great organisations into this project,”

with the implementation of a number

says Gustafson. “Both companies

of new high added value petrochemical

possess a deep set of technical and

products. The project is set to cost

commercial experiences and world

approximately $9.4bn with capital

class product mix that continues to

project debt funding. Gustafson

improve with expansions to capitalize

outlines the procurement strategy his

on the strategically placed location

company is utilising in this exciting

and resources.”

new era for the Kingdom.

DECEMBER 2018

S U P P LY C H A I N

“ People think of procurement as being some sleepy, back office support group – but it’s not. You’re actually on the front line and if this spare part, chemical additive, or catalyst doesn’t arrive on time, you could shut down a facility” — Michael Gustafson General Manager of Material, Procurement and Contracts

81

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S U P P LY C H A I N

“We’ve almost finished Phase II to

under the same roof. Gustafson

expand our business. It’s like you’re

maintains its current procurement

running on a treadmill and the speed

strategy is to enhance its existing

is set at a six-minute mile but you’re

arrangements.

used to running an eight-minute mile,”

“In general, the majority of our

he explains. “People think of procure-

strategy is to push our agreements

ment as being some sleepy, back

and expand into MRO and chemical

office support group. But, it’s not.

agreements,” he explains. “This is

You’re actually on the front line and if

opposed to the ongoing spot buying

this spare part, chemical additive, or

that takes place, which decreases the

catalyst doesn’t arrive on time, you

time it takes to turnaround, as well as

could shut down a facility.”

the cycle time.”

Procurement is certainly an area

In a bid to handle its supply chain

that Petro Rabigh prioritises. The

items more effectively, Petro Rabigh

firm has three different departments

has made the decision to split into

operating in that area of its organisa-

two separate groups.

tion; with contracting, material handling and procurement all housed

“The group here in Saudi Arabia handles all the inbound supply items

E X E C U T I V E P R OF IL E

Michael Gustafson Having joined Petro Rabigh in 2017, Michael has used his 25+ years of experience and knowledge from working in commercial and business development, acquisitions, divestiture and supply chain management to develop the supply chain infrastructure for the $20bn Refinery & Petrochemical business in Saudi Arabia.

Michael has outlined his intention for Petro Rabigh to embrace the incoming Saudi Vision 2030 and is responsible for driving the company’s procurement strategy.

w w w.busi ne ssc hief. com

83

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S U P P LY C H A I N

CLICK TO WATCH : PETRO RABIGH ENRICHING LIFE 85

and we have a separate organisation that is responsible for the finished goods and products. It’s primarily more of a marketing and sales function,” explains Gustafson. “Alongside that, there’s the production planning which coordinates what the needs of the refinery and petrochemical business are, as well as the requirements of our customers. I believe it’s very much a collaborative effort to enable the supply chain to get going.”

With the company investing almost $400mn annually on its supply chain

“ The group here in Saudi Arabia handles all the inbound supply items and we have a separate organisation that is responsible for the finished goods and products. It’s primarily more of a marketing and sales function” — Michael Gustafson General Manager of Material, Procurement and Contracts

w w w.busi ne ssc hief. com

HOUSE OF ENERGY & INDUSTRIAL TECHNOLOGIES Serving the Oil & Gas industry for over 13 years HOEIT prides itself as a proud partner to Petro Rabigh and a contributor to the growth of the Saudi Economy.

Continuously growing its expertise to help better serve its markets, HOEIT is associated with world leaders in supply and solutions.

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S U P P LY C H A I N

87

activities, Gustafson is well aware

EMBRACING SAUDI VISION 2030

just how big Petro Rabigh’s supply

In a bid to reduce Saudi Arabia’s

chain is. “The magnitude of it is that

reliance on oil and diversify its economy,

it spans to over 2,000 suppliers

Crown Prince Mohammad bin Salman

worldwide that are split evenly

announced plans in 2016 to launch

between America, Asia and Europe,”

Saudi Vision 2030. With around 80

says Gustafson. “Of those, we have

projects expected to be completed in

around 1,200 really active, highly

Saudi Arabia by 2030, Gustafson

consumable suppliers. They deal

believes it’s an interesting time to be

with everything from highly danger-

involved in such a historic process.

ous explosive and chemical addi-

“These are exciting times for Saudi

tives, all the way to papers and pens.

Arabia. When I tell my friends about it

We cover the full spectrum.”

back home in America, I feel like I’ve w w w.busi ne ssc hief. com

C OMPA N Y FA C T S

88

Rabigh Refining & Petrochemical Co. — Petro Rabigh — was founded in 2005 by the Red Sea in the Kingdom of Saudi Arabia as a joint venture between Saudi Aramco and Sumitomo Chemical from Japan. The original 10-billion dollar Phase I of the plant is the world’s largest single-phase integrated refining and petrochemicals complex, making the company one of the Kingdom’s largest producers of polypropylene, polyethylene and mono ethylene glycol, and the sole producer of propylene oxide in the Middle East. The Phase II expansion, which came into full operation in early 2018, diversifies the product slate with new high value-added petrochemicals aimed at making the Kingdom’s downstream industry more competitive and affording potential investors the opportunity to manufacture new products and create new jobs and skills.

DECEMBER 2018

S U P P LY C H A I N

89

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Axens is a leading global

OIL REFINING

provider of technologies, catalysts, adsorbents, services and equipment.

PETROCHEMICALS

Axens solutions are used at major industrial plants around the world.

RENEWABLES & ALTERNATIVES WATER

SUCCEED TOGETHER

GASES

axens.net/blog

S U P P LY C H A I N

“ These are exciting times for Saudi Arabia. When I tell my friends about it back home in America, I feel like I’ve got a front row seat; it’s a major transformation in the Kingdom and these are fabulously exciting times. There are things going on in Saudi Arabia that are truly historical” — Michael Gustafson General Manager of Material, Procurement and Contracts

91

got a front row seat,” explains Gustafson. “It’s a major transformation in the Kingdom and these are fabulously exciting times. There are things going on in Saudi Arabia that are truly historical.”

Petro Rabigh has responded to Vision 2030 by embracing all 24 areas highlighted in the vision to provide a thriving economy, a vibrant society and an ambitious nation for the Kingdom of Saudi Arabia. In order to meet these requirements, Petro Rabigh has rolled out a number of initiatives such as plans to increase women’s participation in the w w w.busi ne ssc hief. com

PETRO RABIGH

to logistics and building relationships

FORMING KEY STRATEGIC PARTNERSHIPS

for additional direct foreign invest-

Establishing and maintaining key

ments. However, Gustafson insists

partnerships are vital to any success-

Petro Rabigh isn’t finished yet.

ful business. Over the last five years,

workplace, supporting improvements

“We could and will do more in the

Petro Rabigh has collaborated with

area of women participating in the

Germany-based logistics firm, DHL,

workplace; I just hired the first female

to provide all of its inbound logistics

secretary at Petro Rabigh and she’s

activities, in addition to operating its

doing a great job,” says Gustafson.

warehouses. However, having consult-

“We also have several women within

ed their Key Performance Indicators

the supply chain organisation and we

(KPIs), Petro Rabigh recently split the

intend to hire more in the future.”

contract with Kuehne & Nagel to

92

DECEMBER 2018

S U P P LY C H A I N

handle all of the company’s interna-

hip. DHL and Kuehne & Nagel are

tional forwarding activities.

two world class organisations and

“We’re very excited with this joint effort between the two

they’ve done a great job.”

Gustafson affirms how much

companies. It will enable us to draw

Petro Rabigh relies on the consist-

on the strengths of each company

ent performance of its suppliers.

to ensure a smooth supply chain

“The notable suppliers that have

process,” says Gustafson. “They

been consistently reliable for our

are our two primary partners that

business include the likes of CS

we’ve got on the logistics side and

Japan, Gold Wing, Axens, Eable-

they’re absolutely essential to us.

Burgmann and SPIG. We’re highly

Our partners have to over-commu-

dependent on the performance of

nicate and be joined with us at the

these five outstanding suppliers/ 93

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Range of products and services

Mechanical seals for pumps

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Magnetic couplings

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Compression packings, Gaskets

Expansion joints

Special products

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S U P P LY C H A I N

vendors in particular, as well as to

investment opportunities to local

the other 1,200 active suppliers in

and foreign investors in conversion

our network.”

industries. Gustafson believes it’s

The introduction of Petro Rabigh’s

an ideal investment opportunity.

collaboration with Rabigh PlusTech

“This large scale, secure complex

Park saw it become the first private

also houses the Sumitomo Chemical-

industrial estate for conversion

run Rabigh Plastic Technical Centre

industries in Saudi Arabia. Located on

that provides tenants with technical

a site adjacent to the Petro Rabigh

support and training in plastic

refinery, it provides a place to convert

processing technology, warehousing,

petrochemical products into down-

plug and use utilities and feedstock

stream products and offer substantial

supply agreement opportunities for

95

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A world leader in sulphur processing and handling IPCO, previously operating as Sandvik Process Systems, is a world leader in the design, manufacture and installation of sulphur solidification and handling plants.

We supply equipment for every stage of the process, from degassing and filtering of molten sulphur through a range of different solidification options, to downstream conveying, storage, reclamation, bagging and ship, rail or truck loading.

Our ranges include the renowned IPCO RotoformŽ, the world’s favourite premium sulphur solidification process with more than 700 systems supplied, and our high capacity rotating drum granulator, both delivering a premium quality formed product.

IPCO sulphur processing systems are in operation around the world and we support them all through a global service network.

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S U P P LY C H A I N

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sustainable, competitive prices,” says Gustafson. “Rabigh PlusTech Park provides for 37 investors, including nine manufacturing companies that have started production, eight that are under construction and over 30 under negotiations.”

SUSTAINING A SUCCESSFUL FUTURE Petro Rabigh has begun to explore options to fully automate its warehouse operations and review the way they receive, monitor and move spare parts

“ Rabigh PlusTech Park provides for 37 investors, including nine manufacturing companies that have started production, eight that are under construction and over 30 under negotiations” — Michael Gustafson General Manager of Material, Procurement and Contracts

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S U P P LY C H A I N

$10bn Approximate revenue

2005

Year founded

3,600 Approximate number of employees

99

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– To achieve this goal, we have accumulated knowledge and expertise, and then steadily incorporated this wisdom into our services.

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S U P P LY C H A I N

101

around. This ability to consistently adapt to change is something Gustafson places a lot of importance on.

“In the area of supply chain, I believe we still have work to do in digital transformation,” explains Gustafson.

“However, in other areas of the company there has been much more progress made, especially in operations.”

“When things start to change, you’ve got to be able to adapt very quickly.

Whether it’s changing your grades or

“ When things start to change, you’ve got to be able to adapt very quickly. Whether it’s changing your grades or the type of product mix that you can develop” — Michael Gustafson General Manager of Material, Procurement and Contracts

the type of product mix that you can w w w.busi ne ssc hief. com

PETRO RABIGH

Our Website Contact us DECEMBER 2018

S U P P LY C H A I N

103

develop. You’ve got to stay ahead. We’ve got a lot of big changes going on at

ongoing operations,” says Gustafson.

“Our processes and practices must

the moment with climate change and

change and this will be enabled through

environmental conditions. And if we

the finalisation of the ARIBA implemen-

don’t change, then it’s going to hurt us.”

tation, integration with SAP and further

As far as the future is concerned at

digitalisation of the processes.”

Petro Rabigh, the company has lofty

“This is crucial for us to handle the

ambitions of becoming the best in class

increase in volume due to the expand-

in the Gulf Cooperation Council (GCC)

ed capacity of the operation. We must

within the next 18 months. “We have to

reduce the number of touches on work

deliver on the business expectations in

orders from procurement to pay with

two areas: 99% availability and on-time

seamless vendor integration through

delivery of materials to support the

the process.” w w w.busi ne ssc hief. com

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S U P P LY C H A I N

105

Petro Rabigh also plan to begin to take steps to become a world-class service minded organisation that will enable the firm to provide exceptional customer service that goes beyond expectations.”

“This can happen when we break down silos, over communicate to customers and provide proactive service levels with their absolute best interest in mind,” explains Gustafson. “We will do this through cross development opportunities with operations, by co-locating people closer to the customers they

“ Our processes and practices must change and this will be enabled through the finalisation of the ARIBA implementation, integration with SAP and further digitalisation of the processes” — Michael Gustafson General Manager of Material, Procurement and Contracts

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PETRO RABIGH

serve and rewarding people for delivering on their commitments.”

Petro Rabigh also plans to increase its employee development, training and planning to ensure everyone successfully obtains their Certified Supply Chain Professional certification as well targeting an 85% or higher Saudization level and a 40% rise in the hiring of women. In addition, the firm expects to make a more deliberate effort in its supply relations and strategic sourcing.

106

“We will be conducting a major supplier recognition conference soon in order to build deeper, strategic relationships with key suppliers and vendors,” says Gustafson. “This will take time, but the idea is to personally visit our key suppliers for them to understand the direction we’re going, how they can optimally support and ways we can further collaborate together to meet the Saudi Vision 2030 plans.”

With major changes incoming at Petro Rabigh and in Saudi Arabia itself ahead, Gustafson remains determined that the future is bright for the company in the next 18 months and beyond.

DECEMBER 2018

S U P P LY C H A I N

“ The vision for the future is to continue to make the Material, Contracting and Procurement organisation a great place to work” — Michael Gustafson General Manager of Material, Procurement and Contracts

“The vision for the future is to continue to make the Material, Contracting and Procurement organisation a great place to work. We also envision becoming a leader in driving collaborative value through matrixed processes, creativity commercial acumen and focused commitment to the priorities that will make Petro Rabigh the most valuable company in the region.”

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107

108

A digital transformation of

the customer experience WRIT TEN BY

CATHERINE S TURM AN PRODUCED BY

MIK E SADR

DECEMBER 2018

TECHNOLOGY

109

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S H E R A P U B L I C C O M PA N Y L I M I T E D

Leading the way in the roofing and walling industry with its creative flare and pioneering spirit, SHERA has implemented new technologies to transform the customer experience. We spoke to Vice President of Information Technology, Athikom Kanchanavibhu

R 110

anked as the consumers’ number one provider of fibre cement building material in Thailand for the seventh consecutive

year in a row, Shera Public Company Limited is widely revered across the fibre cement industry.

However, having operated for more than four decades, the business is routinely aware of its need to remain adaptable and responsive to the ever-changing needs of its customers, by investing in new technologies while upskilling its workforce to retain its global position.

As innovations such as the Internet of Things (IoT), predictive analytics and intelligent innovation continue to gain momentum, manufacturers are increasingly looking at new, agile ways to create a seamless infrastructure to transform business processes, not only to improve efficiency, quality and safety across their operations, but to remain profitable year-on-year across an emerging digital landscape.

DECEMBER 2018

TECHNOLOGY

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Responsible for overhauling SHERA’s business processes to further engage and enhance the quality of its products and services, Vice President of Information Technology, Athikom Kanchanavibhu, has sought to fully disrupt the market, viewing technology as one of the key tools for growth, not only for distributors and retailers that sell SHERA’s products, but for its contractors, architects and home owners that use its innovations.

“There is a lot of discussion at management level surrounding digital transformation strategy, how to integrate technologies and conduct

“ Consumers are now expecting products to be more varied in terms of patterns and colours. We need to be flexible enough to allow that tradeoff” — Athikom Kanchanavibhu, Vice President of Information Technology, Shera Public Company Limited

surveys to understand not only our customers, but also our stakeholders,” he says. “We are in the middle of our journey with over 20 projects in progress. In the past 18 months, we have completed quite a number of

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S H E R A P U B L I C C O M PA N Y L I M I T E D

114 projects, such as corporate network and cloud infrastructure transformation while utilising new digital solutions, such as sales force automation to transform how our fields sales approach our customers.”

Whilst SHERA has previously focused on how much it could sell to its customers, through its digital transformation it has sought to invest in the development of new cloud-based technologies on Microsoft Azure, transforming its outdated processes to gain a greater understanding of its customers’ sales and inventory situation, enabling more collaborations to focus on generating demands from end-users.

DECEMBER 2018

“ Our centralised Palo Alto firewall has also enabled us to have better security and visibility across our factories and head office” — Athikom Kanchanavibhu, Vice President of Information Technology, Shera Public Company Limited

TECHNOLOGY

CLICK TO WATCH : ‘SHERA CEDAR ROOFING’ 115 “We now understand more about how our products are sold to customers. In terms of our IT operations, Microsoft Office 365 and chat bots have been transforming our communication standards internally. We have restructured our team to have people focus more on new digital technologies, evolving teams together in the business direction we are going. Our business data are now on multi-cloud, so we are equipping people with analytics tool to extract business insight from growing data that we continue to integrate from new digital solutions,” he says.

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S H E R A P U B L I C C O M PA N Y L I M I T E D

116

of the need to provide agile services,

thing handled by us will be simplified,

built with the customer in mind.

from purchasing the products to the

“In the past, we made a product with

installation by contractors. Another

a set choice of design, but consumers

area of focus is customer needs for

are now expecting products to be

products that promote safer and

more varied in terms of patterns and

healthier home living, these are

colours. We need to be flexible enough

example of things we are thinking

to allow that trade off. This is some-

about at the moment.”

thing we are addressing. Another focus

Across its manufacturing operations,

is on making things more solution

SHERA has been focusing on two

centric,” he explains.

essential areas: one being preventive

“Although we have been innovating

maintenance, the other is quality

on the product itself, we also need to

control. Working alongside a number

be pushing forward the solution. Every-

of vendors, SHERA has gained the

DECEMBER 2018

TECHNOLOGY

“ We have restructured our team to have people focus more on new digital technologies, evolving teams together in the business direction we are going” — Athikom Kanchanavibhu, Vice President of Information Technology, Shera Public Company Limited

E X E C U T I V E P R OF IL E

Athikom Kanchanavibhu

Athikom Kanchanavibhu is Vice President of Information Technology at Shera Public Company Limited, responsible for overall strategy and execution of all IT pillars and co lead digital transformation programmes with other business executives in Thailand and investment countries. He has 18 years of experience in IT & project management, as well as diverse technical proficiency to connect the dots between business and technology. Prior joining Shera, he already had experience working with global FMCG company like Nestle and leading consulting firms like Accenture, IBM, AtoS on various scale transformation initiatives for leading companies in 7 industries. He has B.A. in MIS and MBA from Chulalongkorn University, and holds PMP certification from Project Management Institute (PMI).

w w w.busi ne ssc hief. com

117

S H E R A P U B L I C C O M PA N Y L I M I T E D

ability to monitor and capture vital data,

“Our centralised Palo Alto firewall has

which has been analysed to transform

also enabled us to have better security

its production operations. Machine

and visibility across our factories and

learning technology is also being

head office,” adds Kanchanavibhu.

explored to further enhance and

“Previously, if a malfunction or break-

automate manufacturing process.

down in equipment occurred, the

In terms of network and firewall

company would suffer both in down-

infrastructure, SHERA removed five

time costs and productivity, particularly

vendors and partnered with Thailand’s

as different sites held alternate policies.

largest mobile phone operator and

Utilising a decentralised model made

leading ICT Service Provider, AIS,

processes difficult to manage and led

which has seen the business build

to inconsistencies.

a robust ICT infrastructure across

“We took time to review all network

its operations.

security policies between six different

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TECHNOLOGY

C OMPA N Y FA C T S

• Ranked the number one choice for consumers in the use of fibre cement building material in Thailand for the seventh consecutive year in a row • SHERA has sought to invest in the development of new cloud-based technologies, transforming its outdated processes to gain a greater understanding of its customers situation and needs • SHERA has been focusing on two essential areas: one being preventative maintenance, the other quality control

locations and public internet. With that, we migrated simplified single policy to the new Palo Alto firewall. Everyone is now under a single policy and our visibility is greatly improved. We have just one centralised dashboard to effectively monitor every traffic, including cyber security threats in our networks across factories, private cloud data center and office locations.

Our users also get access to network via automatic single sign-on authentication between Active Directory and new firewall.”

By moving all its operations into the cloud, employees are also able to work on the move, creating a seamless experience, bolstering collaboration. w w w.busi ne ssc hief. com

119

S H E R A P U B L I C C O M PA N Y L I M I T E D

C OMPA N Y FA C T S

120

• Partnering with Thailand’s largest mobile phone operator and leading ICT Service Provider, AIS, has also seen the business build a robust ICT infrastructure across its operations • By moving all its operations into the cloud, employees are also able to work on the move, creating a seamless experience and bolstering collaboration.

• Sales teams are utilising new salesforce automation (SFA) system, leading the business to fully eliminate traditional paper-led processes to fully engage its customers.

DECEMBER 2018

TECHNOLOGY

Sales teams are also utilising a new salesforce automation (SFA) system, leaving the business to fully eliminate traditional paper-led processes to fully engage its customers.

“We have fully equipped our field sales with SFA tools from mobileOne. They now have proper route planning for visiting several thousand customers across Thailand on their mobile devices.

At the same time, our management team can see all the information in real time,” says Kanchanavibhu. “Aside from that, in terms of cloud infrastructure, we have moved our on-premise data centre to cloud. Our vendor, TCC Technology, has been working closely with us to successfully migrate all our critical applications and servers to run on private cloud.”

Whilst the business has been a roaring success for more than four decades, it will remain imperative for SHERA to remain ahead of the curve, enabling employees to embracing new technologies in such a digitally-led climate and fully skill up its diverse employee demographic.

“All of this takes some form of effort,” notes Kanchanavibhu. “When we moved to Office 365, it was a big w w w.busi ne ssc hief. com

121

S H E R A P U B L I C C O M PA N Y L I M I T E D

change compared with how people worked in the past. Now, they can do it all through web-based applications.

We need to educate our people about the benefits that can be unlocked through moving to the cloud, as well as new technologies which we implement.�

As the company remains steadfast on its digital journey, removing outdated legacy processes and promoting connectivity, SHERA has transformed its processes, leading to increased quality, safety and compliance across its operations. With 3,000 employees 122

throughout its headquarters in Bangkok, its five manufacturing and distribution plants in Thailand, its three and expanding oversea offices, the company will continue to provide essential employment opportunities, support local talent and further its world-class reputation for its customerled services, sustained by innovation.

DECEMBER 2018

TECHNOLOGY

“We have equipped our field sales with SFA tools from mobileOne. They now have proper route planning for visiting several thousand customers across Thailand on their mobile device” — Athikom Kanchanavibhu, Vice President of Information Technology, Shera Public Company Limited

123

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FWD Thailand:

124

promoting engagement across the insurance sector WRIT TEN BY

CATHERINE S TURM AN PRODUCED BY

A LE X PAGE

DECEMBER 2018

TECHNOLOGY

125

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FWD INSURANCE

126

Growing rapidly across Asia, FWD Insurance has become renowned as a dynamic player in Thailand’s insurance market

F

ocused on creating fresh customer experiences through the use of digital

Singapore, Vietnam and Japan.

FWD in Thailand, however, is focusing on life insurance, employee benefits

technology, FWD Insurance has

and investment-linked insurance.

a vision to change the way people

Such is its impressive growth, the

feel about insurance.

business has become renowned

Providing life and medical insur-

in Thailand’s insurance market, with

ance, general insurance and

over 800,000 customers nationwide,

employee benefits, it has expanded

earning the country’s top company

its footprint to Hong Kong, Macau,

award in insurance by Business Plus

Thailand, Indonesia, the Philippines,

Magazine in conjunction with the

DECEMBER 2018

TECHNOLOGY

127

University of the Thai Chamber of

engage with traditional services,

Commerce this year, as well as CMO

companies are frequently investing

Asia’s Thailand Brand Leadership

in new tools in order to appeal towards

Awards in its insurance category.

a wider target audience. Millennials,

Recently in 2018, FWD Thailand earned

in particular, are demanding greater

the Best Contact Center Award and

accessibility, rapid engagement and

the Best Corporate Social Responsibility

a greater choice of products and

Award from Thai Contact Center Trade

services at affordable prices.

Association.

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FWD INSURANCE

130

“ Our uniqueness is that we are the insurance company with a startup mindset.

We’re working very fast – we try to give experiences to the customer that work; get feedback quickly, and continuously improve our propositions” — Verapat Chantaravannakul , Chief Information Technology Officer

Health Insurance, Verapat Chantaravannakul joined FWD Thailand in 2016 to implement its long-term digital strategy and become part of an exceptional, award-winning business.

Appointed as Chief Information Technology Officer, Chantaravannakul has delivered new initiatives whilst maintaining everyday functionalities.

He has also launched new ways of working in alignment with the company’s vision. By fully adopting an entrepreneurial leadership style, he has promoted agility across all business fronts.

“I’m always the one who jumps up to do something new. It is about inspiring people with a new mindset to change their processes using technology to better serve the customer. It is not just about the tools, it’s about people’s mindsets,” he says.

“Our uniqueness is that we are the insurance company with a startup mindset. We’re working very fast – we try to give experiences to the customer that work; get feedback quickly, and continuously improve our propositions.”

With over 25 years’ experience, Chantaravannakul has gained a greater

DECEMBER 2018

TECHNOLOGY

CLICK TO WATCH : FWD INSURANCE PROFILE 131 understanding of the value that technol-

better understand who they are as a

ogy can bring. However, this is with the

person. What are their key strengths

caveat that longstanding employees,

against particular areas of improve-

some with decades of experience

ment? At the same time, infusing the

at the company, have to also see this

Agile mindset and Lean thinking, which

value in order for the business to reap

we believe are the key ingredients for

financial rewards.

our highly dynamic and fast-moving

Providing mindset and culture training which is open for any interested

environment” adds Chantaravannakul.

For FWD Thailand, ‘digital’ doesn’t

employee, the business has therefore

solely encompass IT or technology,

focused on making its workers more

but is a mixture between customer

agile and has also worked to enhance

centricity, marketing, operations and

their emotional intelligence.

IT. Over 150 people from multiple

“We can customise our courses which are open for all employees to

departments consequently form part of its digital operations. w w w.busi ne ssc hief. com

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TECHNOLOGY

“ [Digital transformation] is about inspiring people with a new mindset to change their processes using technology to better serve the customer” — Verapat Chantaravannakul , Chief Information Technology Officer

133

CHANGING MARKETS

in-house technology leaders. This

Combining a fast-moving market with

provides the advantage of fast-moving

its ambition to provide outstanding

technology skillsets and the alignment

customer experience and change

with business domain knowledge.

peoples’ views on insurance, FWD

“The cost of technology is approxi-

Thailand has sought to utilise a blend

mately the same everywhere but when

of in-house and outsourced solutions.

it comes to implementing these technol-

Whilst its in-house team has focused

ogies, especially in the insurance

on its business domain and use of

industry, the customisation to fit

available technology, as well as all

local culture, regulation and local

integration and all governance

recreation is mandatory,” explains

requirements, its exploration of new

Chantaravannakul.

technologies has been outsourced with close collaboration along with

“The challenge is balancing the standard technology used which w w w.busi ne ssc hief. com

FWD INSURANCE

FWD INSURANCE

• F WD Thailand has a vision to change the way people feel about insurance.

• F WD Thailand has expanded its footprint to Hong Kong, Macau, Thailand, Indonesia, the Philippines, Singapore, Vietnam and Japan.

• O ver 800,000 customers nationwide • The company has earnt the country’s top company award in insurance by Business Plus Magazine in conjunction with the University of the Thai Chamber of Commerce (2018) 134

• Verapat Chantaravannakul joined FWD Thailand in 2016 to implement its long-term digital strategy and become part of an exceptional, award-winning business.

• Through engagement platform application, FWD MAX, customers are able to earn loyalty points which can be redeemed at various places, such as coffee shops, wellness and lifestyle recreational facilities.

• The company’s call centre has been recognised as one of the most distinguished customer contact centres in Thailand, winning the Consumer Protection Call Centre Award in 2017 • F WD Thailand renewed its existing partnership with bank partner, TMB Bank, in 2017, forming a critical part of its growth

DECEMBER 2018

TECHNOLOGY

gives us better leverage in terms of cost, but also the local customisation. This is quite a challenge, but we handle it quite well.”

Delivering an array of products, FWD’s Call Center and Chatbots remain areas which provide direct impact to the customers. Additionally, its API Gateway and microservices platform on the cloud have guaranteed further flexibility and a quicker time to market.

Through engagement platform application, FWD MAX, customers are also able to gain rewards. By tracking their activity, such as jogging and running, customers can earn loyalty points which can be redeemed at various places the company is partnered with, such as coffee shops, wellness and lifestyle recreation facilities.

Across its entire portfolio, personalised customer services have become vital to FWD Thailand’s success.

Through its customer portal, big data and customer analytics are utilised in order for the business to gain a greater understanding of customer needs, where various products and services are then matched to each customer.

On top of using popular instant w w w.busi ne ssc hief. com

135

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There is growing demand from distributors to provide information anytime, anywhere on any device. Also, they would like to transact business while they are on the field so that they can spend more time on field with customers than in the office.

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TECHNOLOGY

137

messaging system, LINE, as well as artificial intelligence (AI) and personal agents that engage with customers, the company has retained its call centre, which has been recognised as one of the most distinguished customer contact centres in Thailand, winning the government’s Consumer Protection Call Centre Award in 2017.

SEAMLESS COLLABORATION By embracing long-term partnerships, particularly in bank assurance, FWD Thailand renewed its existing partner-

“ The challenge is balancing the standard technology used which gives us better leverage in terms of cost, but also the local customisation” — Verapat Chantaravannakul , Chief Information Technology Officer

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FWD INSURANCE

ship with TMB Bank in 2017, forming a

feel about insurance. It is all about

critical part of the company’s growth.

giving something inherently better

“We have been partnered with TMB

to the customer, so the strategy of the

Bank for more than 10 years, and have signed on for another 15 years. I would

two aligned closely.”

“Additionally, C2L BIZ is one of our

say it’s a bit unique and not just a

long-term partners, providing service

normal broker or intermediary partner-

and support in several key systems. In

ship. It’s somewhat like the hand and

our front office layer, we are using their

hand management consideration when

SymbioSys platform, which integrates

it comes to thinking about customers,”

well with our core policy admin system.

observes Chantaravannakul.

We also use their Distribution Man-

“TMB said they want to make the

agement System (DMS) for sales

difference in the financial world. We

commission and compensation.”

say we want to change the way people

Throughout its mission to revolution-

138 E X E C U T I V E P R OF IL E

Verapat Chantaravannakul Verapat has been at FWD Life Insurance Thailand since 2016 as Chief Information Technology Officer, overseeing all aspects of IT initiatives, software development and IT infrastructure.

He is passionate about digital transformation, starting from the paradigm shifting in people mindset and working closely with the business units to deliver new value to the customers.

Prior to this role, Verapat was the CIO of Generali Insurance Thailand and the Business Transformation and IS Director for Bupa Health Insurance.

TECHNOLOGY

139

ise the customer journey, FWD Thailand’s sister company, PCCW Solutions, has also become significantly advanced with regards to its technology. Furthermore, the company’s partnership with system integrator, Golden High, has supported the company to overhaul its customer communication engagement platform.

“Golden High have been providing the service for our sister entities in Hong Kong, as well as other countries where we market,” notes Chantaravannakul. w w w.busi ne ssc hief. com

FWD INSURANCE

“Golden High have expertise in terms of handling this communication management platform and have been selected as our lead implementer in Thailand.

They are really flexible, and I like them because in FWD Thailand we work our technology enabler from a businessvalue-creation point of view and they are flexible enough to adjust themselves and embrace our Agile way of working.”

140

“ We will use technology throughout our transformation to change the inside of our organisation, while also innovating products and services which we give to our customers” — Verapat Chantaravannakul , Chief Information Technology Officer

DECEMBER 2018

TECHNOLOGY

141

With the aim to change the way

destination? The world changes so

people feel about insurance and

fast, but one thing we know, we have

better serve its customers through

to hold to the heart in giving the best

the use of digital technology and data,

to our customers, which remains the

FWD Thailand will continue to look at

first priority for us.”

further opportunities to drive the business forward.

“We will use technology throughout our transformation to change the inside of our organisation, while also innovating products and services which we give to our customers,” observes Chantaravannakul.

“But then what would be the w w w.busi ne ssc hief. com

142

Digital Realty spearheading Sydney’s data centre market with digital disruption WRIT TEN BY

NIKI WA LDEGR AVE PRODUCED BY

GLEN WHITE

CONSTRUCTION

143

D I G I TA L R E A LT Y

Digital Realty has just opened its third Sydney facility. Its Director of Construction, Daniel Howard, tells Niki Waldegrave why it’s so important to the APAC footprint

D

igital Realty prides itself on delivering a portfolio of data centre solutions with a record of 99.999% uptime

for the past 11 consecutive years, equating 144

to more than 1.7 billion operating minutes, unmatched by any other data centre provider in the world.

It has more than 195 centres globally across over 30 markets throughout Europe, North America, Asia and Australia, servicing top-tier clients including Facebook, IBM, AT&T, LinkedIn and Equinix. Its Sydney data centres are hugely important to its Asia-Pacific business and SYD 11 – its new Digital Erskine Park 2 Data Centre – is the new kid on the block, following the adjacent SYD 10 facility.

The SYD11 facility on 13-23 Templar Road is the largest facility the business has built in Australia and is located adjacent to its existing data centre in Erskine Park, which opened in November 2012.

DECEMBER 2018

CONSTRUCTION

It opened to much fanfare on the 15th November and is a 16.8MW two-storey, six-data hall facility data centre with office space. MV Power Generation (11kV) is installed within the SYD11 facility, capable of efficient and fast demand response and to date, the capital investment for the facility is around $100 million, with another $50-100 million to go.

“We’re just finishing at the moment, putting the final polish on,” says Daniel Howard, Digital Realty’s Director of Construction APAC. “It’s a two-story data centre and we are using the lightest technology in lithium battery UPSs, which has given us a much more streamlined footprint, so we can fit more power into a small space in comparison to our previous generation data centres, such as the SYD10 Erskine Park I facility.

“We’ve got MV Power Generation so we’ve got the ability to come off grid quite simply now and can support the whole site with generation. This allows us to match the generation capacity to the load experienced at the time, whereas, with the traditional or low-voltage generation system you can’t really w w w.busi ne ssc hief. com

145

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CONSTRUCTION

align your generators that well with the

Interest in the building is off the scale

load, so you can quite often end up run-

due to Sydney being a global hotspot

ning more generators than you require.

for innovation. It boasts the biggest

“But with the MV generation, we can

tech start-up ecosystem in Australia

select which generators are required

and ranks 16th among 20 cities on the

and match it to the load that’s experi-

Start-up Ecosystem Index, with 64%

enced on that day. We’ve completely

of Australian tech startups in Sydney.

fitted-out the first level – half the building

“The demand that’s in the market in

– with IT power ready to go so you can

Sydney at the moment is unprecedented

power-on generators.”

with regards to data centre capacity,”

The next phase to be fitted-out with

adds Howard, who is an expert in the

UPSs, generators and capacity is

delivery of complex data centre projects,

the ground floor, and that should be

with experience in project management,

completed by the middle of next year.

design management, construction

E R S K INE PA R K , S Y DNE Y

Digital Erskine Park 2 is a new facility located adjacent to our existing data centre in Erskine Park. It is a 19MW facility to be built in phase with 9MW ready in Q4, 2018. Digital Erskine Park 2 has the ability to reach out to PIPE-IX , the 2nd largest IX in Australia in Digital Erskine Park 1.

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147

D I G I TA L R E A LT Y

management and property development.

He built the SYD10 Erskine Park I facility in his previous role at FDC Construction before moving client side.

“This building may be completely filled up within a year of its opening, which is exciting in itself. We have existing customers that are energising or going live very soon after we hand it over to them, so we’ve fitted-out two of the six data halls and we’re in discussions about the remaining four data halls to be leased.

“We’ve built-in the SCEC requirements within the fabric of the building so that any 148

customer coming in can upgrade their data suites to SCEC which allows for the government work. It’s exciting to see so much interest in the building, and in contrast to our previous buildings, that has probably been a steady fill over a four-year period.”

When it comes to construction, the business’ partners include key contractors, including A.W Edwards, Barnwell Cambridge for electrics, D&W Plumbing, Cummins, Schneider and Parratech.

“Construction is always challenging,” he explains, “but we’ve got well-established relationships – and when you’re working with people that have worked with you before, it makes it a lot easier.

DECEMBER 2018

“ The demand that’s in the market in Sydney at the moment is unprecedented with regards to data centre capacity” — Daniel Howard, Director of Construction, Digital Realty

CONSTRUCTION

CLICK TO WATCH : ‘DIGITAL ERSKINE PARK 2 ­— CONSTRUCTION UPDATE IN SYDNEY, AUSTRALIA’ 149 “We grab our knowledge from across the globe. We’ve got our design construction centre in Boston and we use our experience across all the facilities globally in both building construction techniques and technology.”

The cooling system in SYD11 is a Vertiv DSE CRAC unit with rooftop condensers which provide indirect free cooling via pumped refrigerant technology achieving an industry leading PUE. “It’s what they call an ‘indirect free cooling system’,” he adds. “It has a roof-top economiser and pump refrigerant that uses the outside air to cool the facility without having

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D I G I TA L R E A LT Y

to bring the outside area into the facility.

sort of Virginia-Dallas DSE units,

“We’re the only company in Australia

whereas in Europe we use an indirect

that I’m aware of that’s using the BSE

adiabatic solution because it’s got

system and we pioneered that with

a cooler climate.”

Vertiv in the United States for our US

Indirect adiabatic is essentially

systems. We’ve applied it in Australia

a cooling system that relies more on

because it’s a very good climate for

water than it does power. In European

us so we’re getting low PUEs across

regions such as Dublin, for example,

construction, high reliability with the BSE

where you’ve got the maximum temp-

system and just overall energy efficiency.

eratures of 30 degrees, you’re able

“The major variable with technology

to use that with much less energy.

is generally cooling equipment based

“In Australia, we need to have provi-

on different climates around the world.

sions for the 45-46 degree days that

In Sydney, we’ve gone with the US-style

we have every now and again,” he adds.

150

DECEMBER 2018

CONSTRUCTION

“ In Sydney, we’ve gone with the US-style sort of Virginia-Dallas DSE units, whereas in Europe we use an indirect adiabatic solution because it’s got a cooler climate” — Daniel Howard, Director of Construction, Digital Realty

“We need equipment that will accommodate for that but also when it’s not 45 degrees it’s still very efficient, and that’s where the BSE system has come into play.”

Digital Realty has also just secured land for the construction of another two-story building nearby (Sydney) of around 16,000 square metres which will go through the planning approval process in tandem with fitting-out the remainder of SYD11 so there is another facility ready to go as soon as that capacity is leased-out.

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E X E C U T I V E P R OF IL E

Daniel Howard

E X E C U T I V E P R OF IL E

Howard from a construction background, which is a bit different, as in Name isHere the data centre world, many mechanical-electrical engineers Approx 100 words quam aut aut eaturi sequi quiasit, qui come from adolupta consulting background.

He acienimi, actually built theconem SYD10 quo facility for the builder cusdand enistium offici before intocone the client side role, Sundant which is as unique in de the industry. blaudimoving occumqui laborep ratur? rempe “I’m sure I’m sequo not theomnisitem first one that’s a construction backvoluptu ribus, laut acome dolutfrom occulparum ground to do that,” he says, “butende coming from a concrete hillant quibus mi, voloreprovit deres aliandit harit, and steel background to con electrical equipment, power factors, kilonet, offic temperro experat.

Cum faccum quati officiet watt cooling BSE unitsfaccum has been of a transformation.” peresti ncitiaand in restrum quoa bit el illuptam dolupta Howardalitaquo is an expert in thevellant. delivery complex Data erempor tem secae Ta of quid qui veliqui Centre Projects to meet the demanding requirements of nobitius diti atibusa consediossit evel ius des qui con ped modern data totatust centres, dis with experience in Project Managequam, sedit, nonsequ aepernam fugiti conestoment, Design Construction Management and tas everes id Management, ut autem et moluptius.

Igenis soloribus accate Property Development. sendit, que nos et que ebit et omnih.

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D I G I TA L R E A LT Y

“It’s good to be in a position where as soon as we’re finishing one building, we’re thinking and acquiring land for the next,” adds Howard. “The key

$2.475bn Approximate revenue

thing about Erskine Park is that there are probably three hubs in Sydney at the moment.

“You’ve got one hub in and around the airport where a lot of the sub-sea cables are landing, which have the connections to the rest of the globe up to Singapore and Guam and over to the US and New Zealand.

“The next hub is probably the Macquar152

2004

Year founded

1,436

Approximate number of employees

ie Park area, and then, the last hub is out in the Erskine Park Eastern Creek area. The major attraction to that area is the ability to do large scale because of the power availability in that area.”

There are multiple data centres within the area, so it’s carrier-rich, with lots of

“We’re looking for sites that are around

communications cabling around the

two to four times the size of our existing

area, and the Western Sydney Bulk

sites,” he adds. “We’re now looking at

Supply Point Substation – a 1500 MVA

six to 10-hectare sites; that’s just an

transmission station – is connected

indication of which way we’re going.”

directly to the power station.

Next on the construction agenda for

“In Osaka, we’re working on developing the next 70 megawatts of IT load

Digital Realty is doubling the APAC

for our clients and the market. We’re

footprint, with the new space in Sydney,

also undergoing a process of procuring

land in Melbourne and acquiring more

renewable energy and that’s where the

space in Singapore, Osaka and Tokyo.

data centres have the biggest impact

DECEMBER 2018

CONSTRUCTION

153

with regards to energy consumption.”

Howard, who was the project manager

“It’s very important that the contractor relationship ensures that the people

for the general contractor client side

who are doing the work are aligned

and organised all the steel and trades

with what you’re trying to achieve.”

for the first three Sydney facilities, will be overseeing all the builds. He’s worked with all the vendors at a direct level, as well as being the one step away from it, and says “It’s a good thing because we’ve got a very good relationship with the contractors. w w w.busi ne ssc hief. com