Global Supply Chain November 2017 Issue

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November 2017 Issue 42


BALANCING CARBON AND CASH Greenhouse gases and the supply chain

The talent shortage From gap to crisis

Shared mobility

Identification and practice

Partnership goals

Emirates Sky Cargo and Cargolux

Sao Paolo •

• Prague

Paris •

• Kano

Riga •

Antananarivo •

• Johannesburg


Turkish Cargo, having one of the biggest transport networks of the world, carries your business to more than 295 destinations in 120 countries.

                                                                  

         

Bespoke Logistics Project of the Year 2017

Domestic Logistics Service Provider of the Year KSA 2017

GCC Supplier Of The Year 2017 KSA Supplier Of The Year 2017

Solutions for a green supply chain SIGNATURE MEDIA FZ LLE P. O. Box 49784, Dubai, UAE Tel: 04 3978847/3795678 Email: Exclusive Sales Agent Signature Media LLC P.O. Box 49784, Dubai, UAE Publisher: Jason Verhoven Manager: Brian Cordeiro Managing Editor: Munawar Shariff Art Director: B Raveendran Production Manager: Roy Varghese

Printed by United Printing Press (UPP) – Abu Dhabi Distributed by Tawseel Distribution & Logistics – Dubai

Contributor’s opinions do not necessarily reflect those of the publisher or editor and while every precaution has been taken to ensure that the information contained in this handbook is accurate and timely, no liability is accepted by them for errors or omissions, however caused. Articles and information contained in this publication are the copyright of Signature Media FZ LLE & SIGNATURE MEDIA LLC and cannot be reproduced in any form without written permission.

Walmart is a retail giant and its initiatives into greening its supply chain is a story worth reading and learning from. Our regular supply chan is full of resource consumption. There’s packaging, loading, optimal route planning, carbon emissions as a result. With the growing e-commerce market, one would think there would be an even higher footprint what with individual packaging, multiple warehouse runs and single package door step delivery. So where exactly are we headed? Based on the new supply chain model, there are a number of solutions that Walmart is coming up with to counter these new challenges. And at the back end of all of these solutions is technology. Read all about it on page 22. Cargolux Airlines and Emirates SkyCargo have announced that they will be entering into a codeshare partnership for air cargo transportation. The agreement was signed in Dubai by Nabil Sultan, Emirates Divisional Senior Vice President, Cargo and Richard Forson, President & CEO Cargolux Airlines in the presence of François Bausch, Minister of Sustainable Development and Infrastructure, Luxembourg. This is the second phase of a strategic operational partnership with the two carriers working closely on a number of operational areas including block space and interline agreements, aircraft charter, hub connectivity between Dubai and Luxembourg and cargo handling cooperations. Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World, recently unveiled plans to develop Saudi Arabia’s Jeddah port in support of the Saudi Vision 2030. Jeddah Port is a gateway port for the Saudi market and for the region, connecting to major markets in Africa and the Middle East, and that its role as a trade hub can be further boosted by DP World’s vision for its development over the next 30 years. Also read about sustainable mobility solutions, a by-the-numbers look at the logistics of in-flight meals served in Emirates and so much more.

Munawar Shariff Managing Editor


November 2017 Issue 42


22 06 News 16 Country report India Positive outlook up ahead After the deep hit India took due to demonetisation, it is finally time for recovery

22 Cover Greening retail: greenhouse gases and the supply chain Greening retail has become a true double entendre, with carbon and cash both essential to business for giant corporation Walmart

30 The talent shortage: From gap to crisis DHL’s report on the impact of digitalisation and the status of the supply chain profession both of which are driving a global talent shortage crisis

36 The case for shared mobility Frost & Sullivan shares a brief about identifying a new mobility solution 4 NOVEMBER 2017

38 Behind the scenes Logistics of Emirates in flight meals A look at the logistics of the what and the how of your dining experience on Emirates

40 Guest column Taking the ‘high road’ towards responsible logistics This industry heavily consumes conventional fuel in the process of transporting goods. The call to shift to a more environment-friendly operation is what Mustapha Kawam, President and CEO of GES suggests

42 Pushing the envelope Munawar Shariff talks to Santanu Datta, Director Global Sales, ATS World about the company’s growth and expansion plans

46 The price of perfection If you really want your supply chain to run in peak condition, you’ll need to know how to optimise it across

50 the Upstream, Mid-Stream and Downstream channels

50 Partnership goals Emirates SkyCargo and Cargolux announce codeshare partnership

52 DP World’s plan for Jeddah DP World’s plans to develop Saudi Arabia’s Jeddah port

55 Survival of the fittest Brian Cartwright, MD, Top Management Resources Group (TMR), talks to Christian Juul-Nyholm, MD for Maersk Line, UAE, Iran, Qatar and Oman

58 Riding the wave Org Logistics, Dubai, is planning to open new markets in China and N Africa

Good for the fleet, even better for business. Mercedes-Benz ServiceSolutions provides you with tailor-made packages giving you peace of mind – at a fixed cost over the ownership period. You have three attractive Mercedes-Benz ServiceSolutions packages to choose from: BestMaintenance: Transparent and plannable maintenance costs. SelectPlus: Convenient maintenance and extensive protection against unexpected costs. Complete: A complete service solution for utter peace of mind. Find out more about the different Mercedes-Benz ServiceSolutions for your truck, by contacting your nearest authorized Mercedes-Benz General Distributor or on our website:

GCAA celebrates International ATCOs Day

The UAE General Civil Aviation Authority, under the guidance of HE Saif Mohammed Al Suwaidi, Director General, celebrated a special event to mark the contribution and dedication of the UAE’s Air Traffic Controllers. The UAE has some of the busiest skies in the region with the growth in air travel in the country outstripping growth seen elsewhere in the world. Air Traffic Controllers in the UAE

SITA technology to drive expansion at Ghana’s new International terminal


are responsible for safely and efficiently guiding aircrafts through UAE skies from the Sheikh Zayed Air Navigation Centre in Abu Dhabi as well as to and from the country’s airports in Dubai, Abu Dhabi, Al Ain, Sharjah, Fujairah and Ras Al Khaimah. However, the flying public is unaware of how crucial Air Traffic Controllers are. The GCAA has heavily invested in a full and integrated Nationalization Program since 1998 and

SITA is providing its worldclass passenger and baggage processing technology as well as its airport management solutions to Ghana’s new Terminal 3 at Kotoka International Airport in Accra, helping cement the airport’s position as a vital regional hub. SITA has worked closely with both MAPA, the construction company building the new terminal, and Ghana Airports Company Limited (GACL), the airport operator, to ensure that the new terminal has the most up-to-date technology to support the country’s modern airport infrastructure.

is actively recruiting UAE National cadets to fill positions on the tough training course at the Training Center at the Sheikh Zayed Air Navigation Centre in Abu Dhabi. An Air Traffic Control Awareness campaign was initiated by the Sheikh Zayed Air Navigation Centre in 2011. So far, controllers from the centre have visited a number of schools and universities throughout the Emirates to promote Air Traffic Control. Along with promoting ATC, the program aims to help select better candidates and strengthen ties between the GCAA and learning institutions.

SITA already provides technology for Terminals 1 and 2 at Kotoka International Airport and will ensure that its world-class technology is fully integrated with the existing terminals from day one. This will deliver smooth passenger and baggage processing, and efficient operations across the entire airport. SITA is deploying its latest passenger processing technology including common use Check-In Desks and Self-Service Check-In Kiosks, allowing the airport to maximize its capacity by enabling airlines to cost-effectively share the same infrastructure. The

airport will also make use of SITA’s state of the art Baggage Management technology that will assist airlines in tracking bags every step of the way, helping them meet IATA’s Resolution 753 requirements from day one. On the operational side, SITA’s Airport Management Solution will simplify planning and operational control, and facilitate collaborative decision-making, data management and analysis in Terminal 3 and across the entire airport. It will also support revenue management with its billing and reporting functionality.

Abu Dhabi Airports hosts Saudi Arabia’s General Authority of Civil Aviation Abu Dhabi Airports’ executive management hosted a team from the General Authority for Civil Aviation of the Kingdom of Saudi Arabia for a tour of the current facilities at Abu Dhabi International Airport (AUH) and its Midfield Terminal Building (MTB). The tour started with a walk around the 742,000 sq m MTB structure. Starting in the baggage reclaim hall, which will house ten carousels, the group moved into the area housing the baggage handling system, which is nearly fully installed. 28km of

Fusion selected by flynas to optimize digital journey and enhance ancillary product performance

conveyor belt has been put into place, which will be capable of handling up to 19,200 bags per hour. In the impressive centre of the terminal, the group saw how the hotel and office areas are taking shape, under the vast 18 steel arches supporting the roof structure, the largest of which is 180 m wide and 52 m high. They also moved further into the building to see the spaces allocated for duty-free and food and beverage, and one of the four piers that are nearing completion.

Fusion, a company that drives the increased performance of core flight and ancillary products for global travel companies, has been selected by flynas, Saudi Arabia’s leading low-cost carrier to improve product offering and online sales. Fusion’s role will involve implementing a digital merchandising strategy that uses sophisticated segmentation along with product scoring and real-time decision to personalize user’s online experience. This integration will enable flynas to engage users

Acting CEO Abdul Majeed Al Khoori said,“We are honoured by the visit by the Saudi General Authority of Civil Aviation; as such initiatives foster further collaborations and knowledge sharing that will benefit the entire industry within the region. We shared expertise on revenue and operations management, and reviewed with our guests our processes and procedures with passengers and airlines and gave them a preview of what this will be like once we move into our future home, the Midfield Terminal Building.”

with more relevant content in the booking path for the purpose of improving overall customer experience and achieving higher purchase rates. Fusion’s services for flynas will be highlighted by Web Conversion and Ancillary Product Optimization solutions. The content that Fusion will present in the booking path will utilize the unique traveller profile and optimize offer elements such as product, price, placement and message through ongoing A/B and multivariate testing. The ancillary products

to be optimised initially include baggage and seats, with an option to add more in the future. flynas is a leading low-cost carrier from Saudi Arabia with a young fleet of 29 aircraft, operating nearly 1000 weekly flights to 33 destinations within and outside of Saudi Arabia. Launched in 2007, flynas has successfully operated over 270,000 flights carrying more than 32 million passengers and was awarded the Middle East low-cost carrier of 2015 and 2016 by the World Travel Awards.


Jamal Aziz, SOHAR Freezone CEO, said, “We are immensely proud to have received these two awards, particularly as they are benchmarked against best-in-class free zone facilities from around the world. They bear testament to our significant investments and on-going improvements in accessibility and energy infrastructure. Recent signings, like our new US$300 million cotton yarn plant, that will provide over 1,500 new jobs in SOHAR, show that international investors are equally impressed by what our growing Freezone can offer.” Over the past five years, SOHAR Freezone has emerged as a highly competitive investment location, with reasonable landlease rates and available energy solutions, a

SOHAR Freezone commended by UK’s fDi Magazine for third successive year For the third successive year, the jury from fDi Magazine, a part of the Financial Times publishing group, has awarded SOHAR Freezone in Oman in two of their annual Free Zone of the Year categories. SOHAR

received commendations for ‘Infrastructure Improvements’ and for ‘Energy Independence’ from fDi Magazine Editor, Courtney Fingar, during a short ceremony held at Emirates Towers in Dubai last week.

well-educated local workforce, 100 per cent foreign ownership and no personal tax. With a dedicated One-Stop-Shop team to manage all the licenses and permits required, setting up a business in the Middle has never been easier.

Cognizant cloud-enables ANHAM FZCO’s SAP infrastructure and provides the foundation for digital transformation Cognizant announced it has cloud-enabled the SAP infrastructure at ANHAM FZCO, a leading Middle East-based supply chain firm, to make its enterprise IT environment more agile, costefficient, secure and scalable, enabling ANHAM to respond faster to changing market requirements. As part of the engagement, Cognizant migrated missioncritical, on-premise enterprise SAP production system workloads to the Microsoft Azure cloud platform. This has enabled ANHAM to improve


the monitoring, availability and performance of its IT infrastructure, optimize the capital and operating costs of running it, and strengthen its compliance with NIST SP 800-171 Information Security Standards. A strategic partner to Microsoft and SAP, Cognizant leveraged its innovative service delivery model and SAP Cloud Assessment and Transformation (cCAT) Framework to enable ANHAM to migrate with no business disruption. “In a highly competitive market such as ours, high levels of flexibility and responsiveness

to continually evolving business and customer needs are key to achieving strategic

objectives,”said Claudiu Iarca, Chief Information Officer, ANHAM FZCO.

RAK DED launch affordable health insurance to companies in Ras Al Khaimah Ras Al Khaimah’s Department of Economic Development (DED) launched an online health portal for the Emirate called Sehteq. Sehteq offers optional and affordable health insurance coverage for companies licensed by DED. Sehteq is a state-of-the-art healthcare platform that combines ‘Insurtech’ and ‘Healthtech’, the latest technologies in the insurance and health industries. “The Sehteq commitment demonstrates how the DED continues to work towards the vision of His Highness, Sheikh Saud bin Saqr Al Qasimi to grow and support SMEs,”said Dr. Abdulrahman Al Naqbi, Director General, Department of Economic Development in Ras Al Khaimah.“SMEs are the core of our economic growth. Initiatives like Sehteq will help SMEs to grow and attract the right talent by encouraging a healthier and more productive workforce. Moreover, this initiative will nourish the private healthcare sector in the Emirate and attract local and international investments to meet the additional demand for health services. Sehteq is a proactive step in exceeding minimum standards and achieving our customer happiness goals, well before it becomes compulsory by federal laws. The department will also be launching ‘Innovation Month’ with a number of innovative business ideas and initiatives.”

Sehteq is a true partnership between the public sector represented by DED and a private consortium of local and multinational companies. This initiative is managed by RAK Incubator and Accelerator

while the technology is provided by innovative startups incubated in Ras Al Khaimah. The insurance plans are covered by local, multinational and ‘Takaful’ licensed insurance companies.

ADNOC launches unified brand identity across its group of companies The Abu Dhabi National Oil Company (ADNOC) launched its new unified brand, bringing together its subsidiary companies under one common identity that will highlight the scale of its business, the size of its contribution to the UAE’s economy and its positive impact on the nation’s socio-economic development. The unveiling of ADNOC’s unified brand strengthens ADNOC’s focus on the future and will help create a more integrated, dynamic and progressive corporate culture, with a centralized governance model, while maintaining the operational

autonomy of each company. The launch event, held at ADNOC’s headquarters, was attended by over 3,000 employees from across the organization. H.E. Dr Sultan Ahmed Al Jaber, UAE Minister of State and ADNOC Group CEO, said,“The ADNOC Group has been given a unique responsibility, which is to harness energy resources in the service of our nation. To ensure we continue to deliver on this responsibility we must constantly look for ways to further enhance and evolve our company and adapt to the demands of the global energy industry.”


Tristar supports UN Sustainability Development Goals on road safety Dubai-based Tristar Group has made great strides in implementing effective road safety measures to achieve the UN Sustainability Development Goal No. 3 on ‘Good Health and Well Being’, particularly, Goal 3.6 to reduce the number of global deaths and injuries from road traffic accidents. At a panel discussion at the“Best Practices and Benchmarking Forum 2017”organised by Dubai Economy’s Business Excellence Division in collaboration with Emirates Benchmarking Forum, Tristar Group CEO,

CB&I to Supply Storage Tanks for Greenfield Refinery Project in Oman

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Eugene Mayne, shared the company’s involvement and commitment to addressing the Goal which was launched at the ‘Decade of Action for Road Safety’ by the UN in 2011 to halve the number of global deaths by injuries from road traffic accidents by 2020. Mayne spoke in length sharing the best practices adopted by Tristar since inception, to achieve“zero”or no accidents by the company’s heavy-duty truck and tanker drivers, by building a culture of safety based on the four Es – Education, Engineering, Enforcement and

CB&I announced a consortium between CB&I and Saipem S.p.A. has been awarded a contract by Duqm Refinery and Petrochemicals Industries Company L.L.C. (DRPIC) for EPC Package 3 for the Duqm Refinery Project. DRPIC is a joint venture between Oman Oil Company and Kuwait Petroleum International. The consortium’s scope of work for Package 3 encompasses the engineering, procurement and

Evaluation. Mayne also highlighted that Tristar leverages the latest technology to drive safety improvements in their operations. Tristar has played a leading role in promoting road safety in the UAE. The ‘Let’s Go Home Safely’ campaign in partnership with UK-based Royal Society for the Prevention of Accidents and the Traffic Awareness Department of the Roads and Transport Authority was recognized as an effective Corporate Social Responsibility initiative by the Arabia CSR Network.

construction of a product export terminal at Duqm Port, a crude tank farm at Ras Markaz and an 80-kilometer crude oil pipeline. CB&I will be performing all of the EPC works for storage tanks at the export terminal and crude tank farm, while Saipem – the leader of Package 3 – will perform the balance of the works. CB&I’s portion of the contract is valued at approximately $140 million. “CB&I has decades of experience

in Oman, including the supply of tanks and pressure spheres for Oman Oil Company at their refineries in Sohar and Muscat,” said Luke V. Scorsone, Executive Vice President of CB&I’s Fabrication Services operating group.“This award provides our customer with certainty in price, schedule and quality, and also creates more work opportunities for Omanis, which is one of the goals of the Duqm project.”

Gartner says the Middle East and North Africa information security spending will grow 11 per cent to reach $1.8 billion in 2017

Emirates to receive 100th A380 this month The Middle East and North Africa (MENA) spending on information security technology and services is on pace to reach US$1.8 billion in 2017, an increase of 11 percent over 2016, according to Gartner, Inc. Sam Olyaei, senior research analyst at Gartner, provided the latest outlook for the information security industry at the Gartner Security and Risk Management Summit. Security services will continue to be the fastest growing segment in line with global trends, especially IT outsourcing, consulting and implementation services. The growth for security services will be driven by ongoing skills shortages in the information security domain as well as increased awareness of threats. In a region where the oil and gas industry is critical to many local economies, converging of operational technology (OT), Internet of Things (IoT), and IT is pushing many organisations to consider how to handle the new security vulnerabilities created. Rising awareness among chief executive officers (CEOs) and boards of directors about the business impact of security incidents, and an evolving regulatory landscape, have led to continued spending on security products and services not to mention increased accountability at the board level when it comes to security implications making metrics and executive communication a hot topic for leaders today.

Emirates, the world’s largest A380 operator, is set to receive its milestone 100th A380 aircraft on 3rd November. Over 80 million passengers have flown on the superjumbo in the nine years since it first joined the Emirates fleet. Today, Emirates flies the A380 to over 45 destinations. Everywhere it operates, the Emirates A380 attracts consumer demand for its industryleading in-flight experience in all cabin classes and is welcomed by local economies as a contributor to tourism and visitor growth. Sir Tim Clark, President Emirates Airline said,“The A380 has been, and continues to be hugely popular

amongst our customers, many of whom deliberately plan their travel so that they can fly on it. But we don’t rest on our laurels and continually invest to enhance our product so as to continue offering our customers the best possible in-flight experience. On the ground, Emirates had also worked closely with stakeholders to launch and operate an A380-dedicated airport concourse with 20 gates offering direct boarding from the airport lounge, and one of the world’s most advanced engineering centres which include six heavy maintenance hangars, paint shops, and the capability to completely overhaul an A380.

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Bahri’s commitment to further growth in North America takes centre stage at Breakbulk Americas 2017

Bahri, a global leader in transportation and logistics, took part in Breakbulk Americas 2017 in Houston, Texas, from 17-19 October, reinforcing its position through its three-decade-long presence in the U.S. The Bahri booth was opened by Mr. Sultan bin Abdullah Al-Angari, Consul General of Saudi Arabia in Houston, on the first day of the annual event in the presence of Amal Al-Ruwaii, Director for Trade and Investment, Embassy of the Kingdom of Saudi Arabia in United States of America, Ricky Kunz, Chief Commercial Officer, Port of Houston Authority, Jeffrey Blair, Director for Europe and Middle East, Greater Houston Partnership, Wael AlSarhan, Senior Vice President – Marketing and Communication, Bahri, Matthew Luckhurst, Vice President – Liner Services, Bahri Logistics, and Stephen Blowers, U.S. Country Manager, Bahri Logistics. After expanding its footprint in the U.S. market with the opening of its Houston office by the beginning of the year 2017, the Bahri Logistics team has grown the company’s presence in the U.S. Gulf and expanded the scope of the company operations to include significant projects in the logistics sector. Bahri’s newest business unit, Bahri Data, is making pioneering moves in the usage of Big Data and advanced analytics in the maritime industry. As a global leader in data-driven efficiencies, Bahri Data is dedicated to leading crossfunctional initiatives to unearth the knowledge hidden inside the massive data, and thus create an industry-wide transformative impact.

Convergence of Big Data, IoT and AI to drive next-generation applications Big Data Analytics is bringing a step change in innovation across all sectors of the economy for efficient data management. Disruptive technology innovations in the information and communication technology (ICT) space, such as artificial intelligence (AI), Internet of Things (IoT), self-service visualization and structured query

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language (SQL), have deeply permeated various applications and markets. At present, the Big Data market is experiencing a number of technology convergences with advancement in some supporting technologies to address current challenges. “In the age of the digital and connected world, companies have

access to more consumer data than ever before. Conventional big data solutions are limited to the usage knowledge of an individual, thereby analyzing the past data and providing insights on the behavior. Lack of skilled resources further restricts the quality of the insights,”observed Frost & Sullivan TechVision

Research Analyst Swapnadeep Nayak.“Advancements in artificial intelligence in recent years are enabling developers to uncover the hidden relationship between data, thereby significantly facilitating data analytics processes using minimal data input and resolving big data performance issues.”

EMEA’s Top 50 Cloud Innovators Revealed Spearheaded by thoughtleadership innovators and sponsored by application security and cloud experts F5 Networks, the Top 50 EMEA Cloud Climbers Report is the first study of its kind explicitly dedicated to cloud computing’s transformational business impact. The report features 50 companies from a wide range of industries, each assessed for excellence in strategic cohesion, market impact, operational performance and overall value. The retail sector secured the most top 50 slots (12 per cent), followed by financial services (8 per cent), automotive (6 per cent), sport (6 per cent) and transport/logistics (4 per cent). Marquee

names in the report include Spotify (for continually evolving and optimising its massive music streaming service), Mercedes F1 (cloud-fuelled performance analytics) and Airbus (cloud and machine learning to store and process several hundred terabytes of satellite imagery annually). Europe’s leading public-private cloud partnership – the Helix Nebula Initiative – is another notable inclusion and indicative of the technology’s immense reach and influence. A unique partnership between IT providers and Europe’s top research centres (CERN, EMBL, ESA and PIC), the collective’s headline-grabbing work includes aiding the search for the Higgs Boson“God Particle”.

Solutions for a healthy world Tranzone operates a state-of-the-art 3PL warehouse in Jebel Ali Free Zone. We have partnerships with the leading pharmaceutical, medical device and animal health companies around the world.

Healthcare Logistic Services: Air Freight Sea Freight Land Transportation Value Added Services Warehousing & Distribution Return logistics Documentation Tranzone FZCO (Member of Banaja Holdings)

Jebel Ali Free Zone (South) Plot No: S20129 P.O Box : 262955, Dubai, United Arab Emirates, Tel : +971 4 811 0000

Web: NOVEMBER 2017 13

Dubai Customs: First government department to win seven-star rating from Ideas UK Dubai Customs enhanced its worldwide competitiveness in (Corporate Innovation Management system) by attaining the sevenstar rating from Ideas UK in their evaluation

of the 8th platinum accreditation in which the Department’s Corporate Innovation System got the full mark for the fifth year in a row. Dubai Customs becomes the first

government department in the world to get the seven-star rating. The new rating will be granted to Dubai Customs in the 31st Ideas UK award ceremony which will be held in Stratford Upon Avon, UK on November 8-9, 2017. The platinum rating is granted based on the efficiency of the corporate innovation management system which should score 90/100 at least in more than 50 standards including legislative and financial governance.

Introducing Virgin Hyperloop One Hyperloop One, the only company in the world that has built a full-scale Hyperloop system, today announced that Virgin Group has invested in the company to form a global strategic partnership. With this partnership, Richard Branson joined the board of directors and Hyperloop One will be rebranding itself as Virgin Hyperloop One in the coming months. “For more than 20 years, Richard and Virgin

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have been at the forefront of transportation innovation, and a partnership with them feels like a natural fit,” said Shervin Pishevar, Co-founder and Executive Chairman of Hyperloop One.“Virgin is an iconic brand and having Richard as an ally will help strengthen our mission to spread Hyperloop One throughout the world. Josh and I could not think of a better person or brand to be our true partner in

Richard Branson

our continued quest to make our moonshot idea a reality. Onwards.” This global strategic partnership will focus on passenger and

mixed-use cargo service in addition to the creation of a new passenger division. Depending on the market, other brands could be used globally as well. Following the successful test at its Nevada test track ‘DevLoop’ this past summer, Hyperloop One continues to see a growing demand from governments and the private sector around the world with projects underway in the UAE, U.S., Canada, Finland, the Netherlands and India.

FarEye’s Delivery Happiness Platform revolutionizes GCC logistics industry FarEye, a global logistics management solution provider, has enabled leading UAE-based logistics companies Mara Xpress and Century Express, to improve their Delivery Happiness Score with its Delivery Happiness Platform. This new platform allows individuals to simultaneously reduce costs and increase workforce productivity with its unique Business Process Management (BPM) capability. Organisations are always looking to further improve and excel. Whether it is through reduced costs or increased efficiency, FarEye’s Business Process Management (BPM) platform optimises their workflows and boost output. The process involves addressing issues with technology, people and organizational structure. In just one year of partnering with FarEye, Mara Xpress

has completed 500,000 shipments, with an increase in driver productivity of 50 per cent. Century Express reduced its carbon footprint and increased firsttime deliveries by 10 per cent. Both companies have witnessed an increase in revenue streams and efficiency as a result of the deployment. Commenting on these successful implementations, Kushal Nahata, Cofounder & CEO FarEye said,“With the GCC transforming itself into a digital economy, and with the rapid growth of e-commerce in the region, it is essential that the logistics industry continues to innovate and keep up with this pace. Logistics firms need to embrace technology-driven solutions in order to stay relevant. We are proud to have supported Mara Xpress and Century Express in their digital transformation.”

BT and Hitachi partner to develop industrial and enterprise IoT solutions BT, one of the world’s leading providers of communications services and solutions, and Hitachi Vantara, a wholly owned subsidiary of Hitachi, announced a global partnership to co-create innovative solutions in the area of industrial and enterprise internet of things (IoT). The partnership aims to drive better business outcomes for global customers, including greater efficiency, productivity and cost savings. The companies will initially Ryuichi Otsuki CEO focus on exploring Hitachi Vantara and designing asset intelligence and predictive maintenance solutions to deliver the desired outcomes for customers in industry sectors such as manufacturing and transportation. Announced at Hitachi’s recent inaugural user conference, Hitachi NEXT 2017, in Las Vegas, the partnership 9. Bas Burger CEO Global unites BT’s global Services BT network infrastructure, cloud capabilities and cyber security expertise with Hitachi’s extensive operational and information technology (OT/IT) expertise, next-generation Lumada IoT platform software and integrated IoT services and solutions portfolio. The companies’ combined technology, infrastructure and expertise will help their mutual customers to take full advantage of connected intelligence and advanced data analytics to streamline processes and optimise business performance on a global scale.



Positive outlook up

ahead After the deep hit India took after demonetisation, it is ďŹ nally time for the economy to look better than all of these days. The economy is looking better than same time last year. And is expected to remain on the growth trajectory. FocusEconomics has this report

16 NOVEMBER 2017


he economy seems to have regained momentum in Q2 FY 2017 following a dismal start to the fiscal year in April, when growth slid to a threeyear low on account of a poorly performing external sector and disruptions caused by the implementation of the Goods and Services Tax (GST). Industrial production continued to recover in August from its June downturn, while September PMI data for both services and manufacturing pointed to an improvement in operating conditions. However, investment remains weighed down by stressed assets in the banking system and overleveraged firms, while the government’s front-loading of spending in Q1 FY 2017 risks fiscal slippage. The fiscal deficit reached 96. One per cent of the full-year target in the first


five months of FY 2017, and the government’s recent decision to cut the excise duty on petrol and diesel is likely to lower public revenues by around US$ 4.0 billion per year. The economic outlook for India was downgraded this month as panelists factored in a lackluster Q1 FY 2017. Nonetheless, activity is expected to accelerate throughout the remainder of the year as the economy recovers from demonetisation and the GST implementation. The economy is seen growing 6.7 per cent in FY 2017, down 0.3 percentage points from last month’s estimate. In FY 2018, FocusEconomics panelists pencil in growth of 7.3 per cent. Inflation was steady in September at August’s 3.3 per cent. The Reserve Bank of India kept its main interest rates unchanged at its October meeting as core inflation

Investment remains weighed down by stressed assets in the banking system and overleveraged firms, while the government’s front-loading of spending in Q1 FY 2017 risks fiscal slippage

NOVEMBER 2017 17


Indira Gandhi International Airport, New Delhi, India

continued to creep up and economic activity firmed up. Inflation is expected to average 3.5 per cent in FY 2017. In FY 2018, inflation is seen averaging 4.5 per cent.

Real sector Economic activity regains traction in September The manufacturing sector consolidated gains made in previous months in September as GST-related concerns receded. The manufacturing Purchasing Managers’ Index (PMI), published by Nikkei and IHS Markit, was steady at August’s 51.2 in September. The index is above the crucial 50-threshold that separates expansion from contraction in the manufacturing sector, where it has now been for two consecutive months. The September report showed that while output and domestic new orders continued to increase, the pace at which they did so was softer than in the previous month. However, firms met higher workloads with increased hiring activity; employment grew at the fastest pace since October 2012. The introduction of the Goods and Services Tax (GST) and higher prices for some commodities caused

18 NOVEMBER 2017

inflation to accelerate in September, although price pressures remained modest by historical standards. The sector seems to be back to its feet following a slump in July caused by the introduction of the new tax regime. Commenting on this, Aashna Dodhia, Economist at IHS Markit, says:“September data painted an encouraging picture as the sector continued to recover from the disruptions caused by the introduction of the GST in July. This sustained amelioration reflected expansions in new work and output, supported by stronger domestic demand conditions. Subsequently, business confidence strengthened among manufacturers as they reportedly anticipate long-term benefits from recent government policies.” Meanwhile, the Nikkei services PMI bounced back into expansionary territory following a two-month dip below the 50-point threshold. The index rose from 47.5 in August to 50.7, a reading indicative of a minor pace of expansion. Both output and new orders expanded for the first time since June, supporting a strong pace of job creation. In fact, employment growth in the services sector was the strongest since June 2011. Outstanding business volumes accumulated

at the fastest clip since 2005. FocusEconomics Consensus Forecast panelists see fixed investment rising 3.1 per cent in FY 2017, which is down 0.3 percentage points from last month’s forecast. For FY 2018, the panel expects fixed investment to increase 6.2 FocusEconomics Consensus Forecast panelists foresee GDP expanding 6.7 per cent in FY 2017, which is down 0.3 percentage points from last month’s forecast. For FY 2018, the panel expects the economy to grow 7.3 per cent.

Real sector Industrial production growth trends higher in August Industrial output expanded 4.3 per cent annually in August, which follows August’s 0.9 per cent increase and marks the best reading since November of last year. The pick-up reflected a broad-based expansion across sub-components, with mining production and electricity supply growing at faster clips than in the previous month, and manufacturing output bouncing back to strong growth following a dip in August. Employing a use-based classification, the fastest rates of output growth were seen in the primary and consumer non-durable

segments, with consumer durable goods output moving back into positive territory. In addition, the production of capital goods rose for the first time in five months in August, an incipient sign that could suggest a small pick-up in capital expenditure growth. August’s industrial production figure suggests that economic growth may have bottomed out at the outset of FY 2017, confirming that the negative effects related to the implementation of the Good and Services Tax (GST) were transitory. While the economy is not yet out of the woods, improving manufacturing PMI data and a turnaround in industrial output point to higher economic growth in the July-to-September period. FocusEconomics panelists expect industrial production to increase 3.6 per cent in FY 2017, which is down 0.5 percentage points from last month’s projection. For FY 2018, the panel expects industrial output to expand 5.4 per cent.

Monetary sector Price pressures moderate in September Consumer prices decreased 0.15 per cent from the previous month in September, which contrasted the 0.89 per cent increase

Inflation was steady in September at August’s 3.3 per cent. The Reserve Bank of India kept its main interest rates unchanged at its October meeting as core inflation continued to creep up and economic activity firmed up

recorded in the previous month. The decline reflected lower prices for food, with vegetables reversing a seven month rising trend and falling a sizeable 7.1 per cent in September. Inflation was unchanged at August’s 3.3 per cent in September, falling below market expectations of a slight acceleration to 3.5 per cent. Inflation is also below the Central Bank’s mediumterm target of 4.0 per cent. FocusEconomics Consensus Forecast panelists expect consumer price inflation to average 3.5 per cent in FY 2017, which is down 0.4 percentage points from last month’s forecast. For FY 2018, the panel expects inflation to average 4.5 per cent. The wholesale price index (WPI) in September decreased a sizeable 0.44 per cent from the previous month, which contrasted August’s 0.79 per cent monthly increase. Lower prices for food and vegetables outdid higher costs for fuels and manufactured

Wholesale market of food and vegetables, Chawri Bazar, New Delhi, India

products. Wholesale price inflation moderated as a result, easing to 2.6 per cent in September from 3.2 per cent in August. However, the trend continued to point upward, with the annual average wholesale inflation rate inching up to 2.9 per cent in September from 2.8 per cent in August. FocusEconomics Consensus Forecast panelists expect wholesale price inflation of 2.9 per cent in FY 2017, which is down 0.2 percentage points from last month’s forecast. In FY 2018, the panel expects wholesale price inflation to average 3.5 per cent. Central Bank keeps rates on hold in October The Reserve Bank of India (RBI) stayed put at its meeting in October as officials sounded a note of caution regarding inflation. Five out of the six monetary policy committee members decided to keep the repo rate steady at a

NOVEMBER 2017 19


Traditional house boat in Kerala, India

multi-year low of 6 per cent, the marginal standing facility (Bank Rate) at 6.25 per cent and the reverse repurchase rate at 5.75 per cent. The sixth member of the committee voted for a cut of 25 basis points to all three rates. The RBI kept a neutral policy stance, noting that it needed“more data to better ascertain the transient versus sustained headwinds in the recent growth prints”. The loss of growth momentum in the first quarter of FY 2017, temporary disruptions in manufacturing due to the implementation of the new tax code, and downbeat consumer and business sentiment all resulted in a downgrade to the Bank’s economic growth projection for the year. However, the economy is expected to have performed better in the following quarter, and Bank officials acknowledged that, based on incoming high-frequency data, a cyclical upturn can be expected in the coming quarters. On the inflation front, price pressures have mounted considerably since the Central Bank decided to cut rates at its August meeting. The Bank stressed that core inflation has picked up more than expected, warranting a halt to the monetary easing cycle. Among the possible upside risks to inflation, Bank officials noted the implementation of state farm loan waivers, pending price revisions following the Goods and Services Tax (GST) implementation, an uneven rainfall distribution and higher oil prices. Against this backdrop, the RBI raised its inflation forecast to 4.2 - 4.6 per cent for the second half of FY 17 (which runs from 1 October 2017 to 31 March 2018), from 4.0 - 4.5 per cent at its August meeting. All told, the Bank struck an even tone as it acknowledged the possibility of slowing growth but stated it

20 NOVEMBER 2017

would continue monitoring incoming data to better assess the nature of the headwinds to growth. In addition, further monetary easing aimed at supporting growth could unpin inflation expectations - now firmly set slightly above the Bank’s 4.0 per cent target. The next monetary policy meeting is scheduled for 5–6 December. FocusEconomics analysts expect the RBI’s monetary easing cycle to be drawing to an end. The panel sees the repo rate ending at 5.93 per cent in both FY 2017 and FY 2018.

External sector Trade deficit narrows in September Merchandise exports expanded 25.6 per cent in year-on-year terms in September to a total of US$ 28.6 billion, well above the 10.3 per cent increase recorded in August and the fastest expansion in six months. Oil export growth accelerated on account of a pick-up in crude prices, while non-oil exports accelerated across sectors, with textiles, engineering goods, chemicals and jewelry all recording strong increases in shipments overseas in September. September’s leap fed into the 12-month trailing sum of exports, which rose to an over five-year high of 11.5 per cent in September from 9.7 per cent in August. The sum of exports in the 12 months up to September totaled US$ 290 billion, slightly above the US$ 285 billion recorded in August. Import growth, on the other hand, rose 18.2 per cent in annual terms in September, which was slightly below the 21.2 per cent expansion recorded in the previous month. Imports totaled US$ 37.6 billion in September. Meanwhile, the 12-month trailing sum of

imports continued to trend higher at an annual increase of 20.3 per cent in September, the highest increase since June 2012 and above August’s 18.6 per cent increase. This brought imports to a total of US$ 426 billion in September, higher than the US$ 420 billion total recorded in August. The robust performance in the external sector led the trade balance to narrow considerably in September, from the US$ 11.7 billion shortfall recorded in August to a US$ 9.0 billion deficit. In the 12 months up to September, the trade deficit was unchanged at August’s US$ 135 billion. FocusEconomics Consensus Forecast panelists expect exports to reach US$ 296 billion in FY 2017. In FY 2018, the panel sees exports coming in at US$ 318 billion. rovider of leading p a is s ic nom sis on the FocusEco and analy ts s a ators c re fo omic indic economic acroecon m t ast, n E a rt le o d the Mid most imp the untries in d o c n a y e a k ic 7 for 12 haran Afr a -S b s u S ie , n pe compa Asia, Euro -thinking rd ation a rm rw o fo F . timely in d Americas n a le b a ess ch reli right busin require su make the sive m n e te th x e lp to he nomics’ o c E s d u c o .F ts, couple decisions economis f are o r, rk e o d a tw ustry le global ne as an ind tation u n p io re it s d o li p o s with its pany’s m o c ence e ig th ll f so ess inte indication e for busin rc u o s l le b ncia as a relia major fina d e world’s panies an m o c l a among th n o ti a in lt u s, m institution s. nt agencie e m rn e gov


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Greening retail:

greenhouse gases and the supply chain US retail giant Walmart’s traditional obsession with efficiency is no longer just a matter of saving money. Greening retail has become a true double entendre, with carbon and cash both essential to figuring out how to remove one billion tonnes of greenhouse gas emissions from its extended supply chain by the end of the next decade. Kevin O’Mara of has more

22 NOVEMBER 2017


NOVEMBER 2017 23

24 NOVEMBER 2017



he commitment is more than just an audacious goal. Walmart’s omnichannel fulfillment ecosystem has been modeled in detail by Bain & Company with compelling results that all retailers and most manufacturers should understand.

Shipping and handling in the age of Amazon Supply chain is a glutton when it comes to resource consumption. Even before the

arrival of Amazon, retail supply chains consumed energy, labour and materials in vast quantities to offer consumers the convenience of readily available stuff on store shelves. Plenty of effort went into efficient packaging design, full truckload delivery and optimal route planning, but still carbon emissions belched forth. Now that e-commerce accounts for nearly a 10th of US retail sales, the supply chain carbon footprint of the sector threatens to balloon with ever more packaging,

single-item doorstep delivery and multiple warehouse stops between factory and consumer. Is the future of retail inevitably tied to more and more cardboard, bubble wrap and UPS trucks?

Maybe not, if the consumer can be co-opted to help. This is where Bain’s analysis of Walmart’s omnichannel fulfillment system comes in. By modeling not only the cost and carbon burden of logistics to the point of sale, but

NOVEMBER 2017 25

also the consumer’s contribution in terms of driving and bundling purchases, we see a potential win-win. It turns out that e-commerce home delivery is not necessarily less carbon (or cash) efficient than shopping in a traditional brick-and-mortar store. Individually purchased items like electronics, clothes and even groceries are worse for the environment, and presumably the customer’s pocketbook too, if they involve a dedicated trip to the store. After all, the UPS truck at your doorstep was likely in the neighborhood anyway, which means the incremental fuel used is a lot less than what you’d burn up driving to the store and home again. The takeaway is blindingly obvious and a natural instinct of supply chain practitioners everywhere: minimise waste. In terms of greening retail, this basically means finding ways to work with consumers’ life logistics to avoid the proverbial empty backhaul. Innovation is well underway on this front, even if few consumers realise it. Initiatives with sharing economy solutions like Instacart or UberRush (see Target, Nordstrom and Safeway for instance) or click-and-collect (Waitrose, Stop & Shop, Kroger, for instance) as well as collection lockers (see Amazon and 7/11), and delivery to car trunks (DHL and Daimler) all involve minimizing logistics waste.

26 NOVEMBER 2017

Battling the merchant mentality For years, supply chain strategists have bowed to the logic that the customer wants “what he wants, when he wants it, where he wants it”, as though shoppers can’t be reasoned with. This is nonsense. Consumers happily play active roles in the supply chain for retailers that offer the right rewards.

For example, IKEA co-opts consumers to do the shipping themselves by designing their products for flat-pack logistics and self-assembly by including idiot-proof instruction sheets. The incentive is a very low price for good, solid furniture. Costco gets us to handle warehousing and inventory on a limited range of top-


Walmart’s Project Gigaton focuses on major supply chain greenhouse gas emissions reduction effort

quality products in bulk packs in exchange for substantial savings. Even BMW has customers building the forecast by allowing customised Minis to be ordered online. Old-fashioned merchant thinking misses most of this by ignoring the full value proposition equation that runs automatically in the consumer’s mind. It includes not only the moment of truth at the shelf, but also the lifecycle experience that combines needing, getting, using and choosing to buy something again. Walmart understands this, and is explicitly designing its omnichannel strategy around the power of stores plus e-commerce being greater than the sum of its parts. The new variable in terms of supply chain is that consumers are being trained to shop actively as online options explode. Digital consumers have enormous power. Walmart is trying to harness it for good. Source:

About the Author Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis.

Taking steps to cut greenhouse gas emissions (GHG) from its supply chain, retail giant Walmart recently announced it has rolled out an initiative, entitled Project Gigaton, which is geared towards helping the company achieve its goal of eliminating 1 gigaton, or 1 billion tons, of emissions from its supply chain by 2030. This follows a November 2016 announcement Walmart made in which it rolled out goals specific for their own operations and fleets focused on an 18 per cent reduction in GHG emissions between 2015-2015. A key component of Project Gigaton focuses on Walmart working with suppliers to achieve the reduction of 1 billion GHG emissions stemming from its operations and supply chains, with the help of what it calls a sustainability platform. This platform functions as a toolkit for a broad network of Walmart suppliers, with a focus on manufacturing, materials and use of products by 2030, which Walmart said is the equivalent of taking more than 211 million passenger vehicles off United States roads and highways for a year. Walmart said it has banded together with non-governmental organizations, including World Wildlife Fund and Environmental Defense Fund (EDF), among others, in creating the emissions reduction toolkit, which makes the business case for why shippers should consider becoming part of the Project Gigaton project. “Through the years, we’ve seen that integrating sustainable practices into our operations improves business performance, spurs technological innovation, inspires brand loyalty, and boosts employee engagement,” said Laura Phillips, senior vice president, Sustainability for Walmart, in a statement. “Our suppliers recognize the opportunity to realize those same benefits in their businesses. By working together on such an ambitious goal,

we can accelerate progress within our respective companies and deep in our shared supply chains.” One of the main drivers for Project Gigaton runs in tandem with an analysis from the Environmental Defense Fund on the relative impact of supply chain-based emissions compared to direct emissions, with a major takeaway being that 80 per cent of the emissions associated with U.S. retail and consumer goods industry is in the supply chain, with Walmart and other retailers accounting for around 80 per cent of those emissions. And it added that 8-9 per cent of the heavy impact associated with supply chain emissions comes from over the road supply chain functions like trucks and trains. “The vast majority of the impact is in the supply chain, which is why what Walmart is doing is so important and focusing on the biggest challenge,” said Jason Mathers, Environmental Defense Fund (EDF) Senior Manager, Supply Chain Logistics. “This is at par with the ambition we see true leaders do these days.” Mathers added that Project Gigaton can be viewed as a leadership action by Walmart for setting out a new challenge for suppliers in a way that is recognizing the challenges being faced, coupled with the opportunity to work collectively in solving these emissions-related challenges. “I appreciate that they accept this target and they have and are providing some tools and guidance for these companies for how to set targets and toolkits for how to achieve them,” said Mathers. “One of the ways EDF and other advocacy orgs can play a role here is by sharing best practices we have with consumer packaged goods and other vendors and suppliers to Walmart and help them understand where they can make progress today that reduces their impact and reduces and benefits the bottom line.” Source:

NOVEMBER 2017 27


The talent shortage:

From gap to crisis 30 NOVEMBER 2017

The impact of digitalisation and the status of the supply chain profession are driving a global talent shortage crisis. Commissioned by DHL and authored by Lisa Harrington, President of the lharrington group LLC, this report highlights the HR issues up ahead for logistics and supply chain companies globally



he supply chain sector is facing a talent shortage that is quickly escalating from a gap to a potential crisis. The U.S. Bureau of Labor Statistics reports that jobs in logistics are estimated to grow by 26 percent between 2010 and 2020 while one global study estimates that demand for supply chain professionals exceeds supply by a ratio of six to one. Others put those numbers even higher.“For every graduate with supply chain skills there are six holes to be filled, and it could be as high as nine to one in the future,” warns Jake Barr, CEO of BlueWorld Supply Chain Consulting. The situation is exacerbated by the exodus of baby boomers from the workforce. Some studies assert that 25 to 33 per cent of the current supply chain workforce is at or beyond retirement age, and the backfill pipeline is inadequate to satisfy replenishment demand. Leading companies understand they must act to resolve this situation, or face the effects of

Without question, the overall demand for supply chain talent is driving a global shortage. Sixty-seven per cent of respondents to the DHL survey cited this as a high or very high factor. But, high demand is not the main reason for the shortage

having the wrong kind of talent to run their supply chains. The potential consequences are worrying – in some industries the talent gap could threaten the ability of companies to compete on the global stage. So, what are organisations doing to address the problem? To find out, DHL Supply Chain surveyed over 350 supply chain and operations professionals in the five major regions of the world. This report summarises the key findings.

Survey results: High level takeaways The factor with the greatest impact on the talent shortage is changing job requirements. Today, the ideal employee has both tactical/ operational expertise and professional competencies such as analytical skills. Fifty eight per cent of companies say this combination is hard to find. But tomorrow’s talent must also excel at leadership, strategic thinking, innovation and high-level

NOVEMBER 2017 31

analytic capabilities. Nearly 70 percent of survey respondents list “perceived lack of opportunity for career growth”and“perceived status of supply chain as a profession”as having a high or very high impact on their ability to find, attract and retain talent. Only 25 per cent of the survey participants say their company views supply chain as equally important as other disciplines. In contrast, 40 per cent see supply chain talent’s value in a situational context – i.e., either a commodity or corporate asset, depending on the level and position. Leading companies are working on the shortage problem. They are taking steps to create more robust talent pipelines, and develop their supply chain workforce – through clear career pathing, education, cultural adaptation, talent development partnerships and other means. One third of companies surveyed have taken no steps to create or feed their future talent pipeline.

32 NOVEMBER 2017

Survey results: A closer look Causes and effects Without question, the overall demand for supply chain talent is driving a global shortage. Sixty-seven per cent of respondents to the DHL survey cited this as a high or very high factor. But, high demand is not the main reason for the shortage. According to the responses, changing job requirements is the biggest single driver behind the shortage. Eighty-six per cent of respondents ranked this factor at either a four or five – high or very high – in terms of its effect on companies’ ability to find the right talent. It is relatively easy to find people who are technically fit for jobs – only 10 per cent of survey participants say they have a problem in this area. Finding talent with solid professional competencies is a bit tougher – 27 per cent indicate difficulty. But the real challenge today comes when organisations

try to find talent with both sets of attributes. Here, 58 per cent report having had trouble. In terms of experience level, entry level people are easy to attract and hire. Middle management is harder to find – 46 per cent of respondents indicate a high level of difficulty. But executive level beats both, with 73 per cent ranking this category a five – most difficult. A related survey question asked what variables impact organisations’ supply chain talent sourcing and retention. Interestingly, the top scoring elements on this question all revolved around supply chain’s image as a career. The industry has known for years that it has an image problem. The widespread perception, especially in emerging markets, is this: Supply chain is not as “good”a career as one in finance, operations, manufacturing, product development, marketing or sales. While the industry has worked hard to


change this perception, judging by the DHL survey results, it still has a way to go. Nearly 70 per cent of respondents list “perceived lack of opportunity for career growth” and“perceived status of supply chain as a profession” as having a high or very high impact on their supply chain talent management endeavors. In a related finding, 59 per cent of survey participants report having difficulty retaining talent. Companies themselves may be part of the problem. Only 25 per cent of the participants say their company views supply chain as equally important as other disciplines. In contrast, 40 per cent see supply chain talent’s value in a situational context – i.e., either a commodity or corporate asset, depending on the level and position. Another issue that may affect acquisition and retention is that organisations appear to struggle with integrating “old”and“new”

In terms of experience level, entry level people are easy to attract and hire. Middle management is harder to find – 46 per cent of respondents indicate a high level of difficulty. But executive level beats both, with 73 per cent ranking this category a five – most difficult

ways of working. Sixty two per cent of survey participants report“culture clashes”around such issues as how talent wants or expects to work, what kind of environment employees are willing to work in, and how they expect to be managed. Finally, despite dire headlines about the lack of a talent pipeline to backfill for the baby boomer retirement bubble, only 37 per cent of the DHL survey pool rated an “aging workforce”as having a high or very high impact on their organisation’s talent management environment.

Skills and strategies for tomorrow Looking to the future, what skills will be required for the supply chain professional of 2020? Interestingly, compared to the competencies valued highly today, future requirements look very different. The primary emphasis broadens to include more strategic

NOVEMBER 2017 33


abilities. When asked to rank the most important skills a supply chain manager of the future must have, the top three responses were: 1. Leadership 2. Strategic and critical thinking 3. Problem-solving skills, creativity and imagination. How confident are companies that they will have the right logistics talent, technical and strategic competencies to meet their strategic objectives in 2020? Forty-one per cent of respondents are moderately certain they are prepared for this issue, but only four per cent are extremely confident. What talent-related steps are businesses taking to ensure their 2020 supply chain? Here, the survey suggests both good and bad news. The good news is that nearly 50 per cent of respondent organisations have recognised that logistics and the supply chain are strategic assets, although only one third of them are organisationally aligned along a clear talent roadmap. The bad news is that 32 per cent of the companies surveyed “have not taken any steps to create or feed their supply chain talent pipeline”for the future. In a competitive environment, where human capital provides the intellectual, strategic and operational excellence that differentiates winners from losers, such inaction seems a risky course indeed. Forty-two per cent do not have a talent management strategy in place to support their needs over the next three years, and 15 per cent don’t know whether such a strategy exists in their organisation. For those companies with a plan for growing their supply chain workforce, what tactics do they deploy? The top-scorers include: 65 per cent of companies encourage professional development through such means as certifications and in-house training, 44 per cent

34 NOVEMBER 2017

of companies are creating an adaptive, flexible work environment, 34 per cent provide clear opportunities for career growth, 32 per cent have established job rotation programs. Looking at the issue of attracting and retaining talent for the long term, what should companies offer to attract and keep talent? On an aggregated score, compensation and benefits took first place. Notably though,“management commitment to talent development” ranked second.

A powerful opportunity The supply chain industry has a clear challenge ahead of it in tackling the talent shortage issue. Companies have made

progress, but there’s still a long way to go. As such, there are tremendous opportunities for improvement. And the rewards are worth the effort. As a Boston Consulting Group study recently found, companies that excel in talent management increased their revenues 2.2 times as fast and their profits 1.5 times as fast as“talent laggards.” Louise Gennis, VP Talent Management/ Acquisition, Learning & Development DHL Supply Chain, Human Resources, said, “We recommend that companies start with prioritising the development of their current talent pool to adapt to the changing job requirements through training programmes, and then retaining staff through clear career paths. We strive to combat misconceptions surrounding working in the supply chain through highlighting the technological developments which are digitalising the industry and that are attractive to younger demographics.” Gennis cites the success of DHL’s diverse recruitment and development initiatives as evidence that a longterm, well-informed talent management strategy can help businesses mitigate the potentially devastating effects of a shrinking talent pool.“The supply chain talent shortage is now critical enough that it’s on the minds of supply chain managers across all industries, but the gap didn’t develop overnight. Since supply chains solutions are our business, we’ve seen the issue developing over many years – and have used this time to adjust our approach toward attracting, developing and retaining talent accordingly. Our unique expertise helps ensure that job openings are filled by qualified experts wherever we and our customers operate, which will become an increasingly critical success factor as talent resources grow scarcer.”

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Greenhouse gases and the supply chain DIGITAL SUPPLY CHAIN


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Logistics at its best

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Myth or reality?

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The talent shortage

Here to stay

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O The case for shared mobility Adoption of new mobility solutions drives growth opportunities within the automotive ecosystem. Frost & Sullivan shares a brief about identifying a new mobility solution

36 NOVEMBER 2017

ver the past few years, urban municipalities’ need to combat congestion and pollution has driven transformational mobility solutions such as car sharing, e-hailing, ride-sharing, and bike sharing. While challenges exist in the form of the regulatory outlook, competition, and advent of new technologies, the increasing demand for mobility solutions and new business and revenue avenues for growth offer ample opportunities. Original equipment manufacturers (OEMs) are exploring new opportunities across the shared mobility ecosystem. Partnering with and investing in e-hailing, ridesharing, smart parking, and technology providers will help OEMs realize their goal of becoming a one-stop shop for all mobility needs. Frost & Sullivan’s research titled Global Mobility Market, Strategic Insight 2017, finds that mobility solution providers are expected to focus on offering robust security systems to enable


cashless payments and understand customer preferences. The study analyses the evolving business models, advanced technology trends, market consolidations and partnerships, and regulatory reforms currently occurring within the global mobility space. Six collaborative business models, i.e. car sharing, peer-to-peer car sharing, corporate car sharing, e-hailing, integrated mobility, and ridesharing are discussed in the report. “Traditional modes of travel included taxi services which were used for short distance travel but is costly, and then there is public transport that covers longer distances but is less expensive. The mobility landscape is now evolving with a host of mobility services like car sharing, carpooling, bike sharing that are combining the benefits of both. Thanks to smartphones, connected transportation services are becoming more efficient and convenient. People are able to commute in buses, cars, trains, bikes with the help

of increased access to information and the awareness of different solutions pertaining to a personal mobility need. With a goal to offer more convenience in transportation in which people can choose the most logical means of transport, the idea of integrated mobility services is emerging. Integrated mobility business models will create a single proposition that is competitive with private car ownership and public”said Frost & Sullivan Future of Mobility Industry Analyst Albert Priya.“With OEMs shifting to the car-as-a-service business model, mobility-asa-service is expected to take off.” Technology is facilitating a rise in new mobility business models, particularly appbased, on-demand services that encourage access to mobility, rather than ownership. Strategic imperatives for success and growth in this dynamic market include a value shift from product to service with market evolution from“car as a product”to the“car as

an enabler”of a connected living ecosystem, new mobility business models that are sustainable and profitable once integrated with other mobility platforms, advanced technologies such as automated driving, connected mobility, electric vehicle charging, and health, wellness, and wellbeing solutions playing a pivotal role in terms of improving the experience offered by vehicle sharing operators by 2025 and customers demanding intuitive services in business-to-consumer and business-to-business environments, thereby propelling participants to invest in delivering seamless propositions and user experiences for integrated mobility. “In the long term, user experience will shift from a product-based experience to a service-based one, and the focus will be on connectivity,” noted Priya.“Cities are launching Smart City initiatives across the world and shared mobility will be at the core, providing first- and last-mile connectivity.”

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E Behind the scenes Logistics of Emirates in flight meals A look at the logistics of the what and the how of your dining experience on Emirates – the world’s largest flying restaurant

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mirates serves more than 100 million meals a year with the same attention to detail in First, Business and Economy Class. Catering for more than 55 million dine-in guests a year travelling to and from 144 cities across six continents, no one understands global culinary trends better than Emirates as it serves destinationinspired cuisine on-board the world’s largest flying restaurant. With a catering investment of US$1 billion per year, Emirates runs a round-the-clock kitchen with 1,200 chefs based in Dubai whipping up 12,450 recipes. The finelytuned operation caters 590 flights a day with authentic local cuisines giving customers a taste of the destination they are going to. The airline also works closely with 25 catering partners around the world to provide the same quality of food for its Dubai-bound flights.

Local flavour Emirates’ focus on local flavour means it has food available from every region it flies to. Flights to Japan, for example, offer authentic Kaiseki cuisine and Bento boxes


served with Japanese crockery, cutlery and tea sets to ensure an unrivalled food experience on board. The airline recently launched a new menu for its Australian routes inspired by the breadth of the country’s multicultural flavours and cuisines, after a 14-month process working in consultation with local chefs. The new menu features a broad range of traditional local favourites such as minted lamb sausages. Reflecting Australia’s multiculturalism, the menu also includes Asian flavours, as well as Middle Eastern flavours and ingredients, catering to Emirates’ diverse passenger mix and representing its global route network. To keep up with regional and seasonal food trends, Emirates changes its on-board menus monthly and continually reviews its recipes. The varied menus on each route are also reflected in the bread baskets served on board. Flavoured bread or bread produced with a sourdough base is popular on European routes while parathas, pooris, and naan bread are served on all nine Emirates routes to India. On its Middle Eastern routes, customers get to enjoy Arabic bread

- Markook - a very thin unleavened bread common in the region, and Manakesh which is either topped with Zaatar or Cheese. In premium classes, meals are served on Royal Doulton tableware with Robert Welch cutlery specially designed for Emirates.

Global partners, best of local and artisanal produce Emirates focuses on simple, well-cooked dishes that emphasise fresh ingredients of the highest quality. The airline brings the finest products on board through longstanding partnerships worldwide and supporting local suppliers and artisans. This includes sourcing over 15,000 kgs of Persian feta from the Yarra Valley in Australia each year. The olive oil served on board is exclusively from carbon neutral producer Monte Vibiano in Italy, a partnership that is now more than 15 years old. Like any star-rated restaurant, Emirates pays special attention to its wine lists, boasting world-class champagne and wines. The wines on each route are carefully selected to complement the menu and include exclusives found only on Emirates such as the Dom

Pérignon 2005 Rosé champagne and 1963 Graham’s Colheita Port. A long-term buying strategy also means that the airline has 3.8 million bottles of wines currently stored in its cellar in Burgundy, France to be served in the next seven to 10 years. Coffee and tea are the two most widely consumed beverages on board. Emirates has been serving Dilmah tea across all its cabins for the last 25 years. Over 9.6 million tea bags are used each year with more than 10 tea varieties on offer, including an exclusive blend created for the airline served in First Class called the Emirates Signature Tea. Illy and Nespresso coffee can be found in premium cabins, where espressos and cappuccinos are the most popular requests. Emirates also offers child-friendly meals for its youngest customers and dedicated menus for medical or religious meal requirements which are designed with a team of nutritionists and chefs. The airline also develops seasonal menus where possible, such as a Christmas menu in December and specially created boxes for those fasting during the holy month of Ramadan.

Fun facts about appetites in the sky In 2016, Emirates’ customers consumed: • 3 million eggs • 70 tonnes of strawberries • 58 million baked bread rolls • 110,000kg of hummus • 165 tonnes of salmon fillet • 27 tonnes of fresh broccoli

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Taking the ‘high road’ towards responsible logistics Conducting business as usual by simply focusing on driving revenues and reducing costs is no longer a valid corporate model in the 21st century. Mustapha Kawam, President and CEO of GES opines


he human, social, economic and environmental problems that beset the world have become too vast to be ignored by the global economy, which has led many sectors to redefine their business strategies to include Corporate Social Responsibility (CSR) and Sustainability related goals and initiatives.

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The logistics and supply chain industry is one of the main sectors that play a significant role in the contribution of solutions to reduce air pollution caused by excessive rise in the emissions of carbon dioxide (CO2), and this is mostly due to it being the second largest source of CO2 emissions, by heavily consuming conventional fuel in the process of transporting goods. The call to shift to a more environment-friendly industry has led to the emergence of ‘green logistics’, which redefines the activities within this sector by developing and implementing strategies that reduce carbon footprint. Globe Express Services (GES) has recognised the need for this transformation early on, by adopting key initiatives in alignment with the global drive towards reducing the pressure on the environment. At the forefront of these initiatives is GES’ commitment to the United Nations’ Sustainability Development Goals (SDGs), particularly Goal 13, which focuses on Climate Action. To implement this, GES signed a contract in 2013 with V4 Advisors, a Greenhouse Gas (GHG) Protocol certified consultant, to audit the GHG emissions of its facilities, and set a reduction plan based on the results of this audit.


Environmental impact To date, V4 Advisors conducted the audit for GES’ main facilities in Lebanon, United Arab Emirates, Saudi Arabia, China, France, Switzerland and the United States of America. Mustapha Kawam, President and CEO of GES, has noted,“Recognising the need to assess the extent of our contribution to global CO2 emissions is an important first step in the long road towards setting up our business on the pillars of a sustainable economy. We needed a reliable tool to ensure that the auditing accurately reflects the impact of our activities particularly in the regions where our largest operations are based. Following the results of the audit, we hope to effectively develop a clear strategy towards improving our processes in alignment with our aim to reduce our emissions and offer the most sustainable solutions to our clients.” The GHG inventory procedure included in the audit report was based on the recommendations of the Greenhouse Gas Protocol (GHG-P) Corporate Standards. This is the most widely adopted protocol by organisations taking huge steps towards understanding the impact of their respective carbon footprint. GES’ GHG inventory was

quantified using the V4 Advisors’ Corporate Greenhouse Gas Calculator tool, which is certified with the ‘Built on GHG Protocol’ Mark. Based on the audit results, GES is now outlining the parametres based on which the GHG emissions reduction targets will be set. Moving forward, regular workshops will be conducted in different GES locations to further engage the team in the GHG emission reduction strategy, and broaden their awareness on climate change. GES also aims to involve its clients in this important initiative by offering them the corresponding tools that would help them track and monitor the environmental impact of their shipments.

Social contribution “Decarbonisation has been an ongoing process in our sector and many technological enhancements have been made so far. We are continuously working on improving our sustainability approach to contribute towards combatting the effects of climate change. In parallel, we are equally keen to address human and social sustainability by contributing to the educational development of underprivileged children. We believe that education is key to address the many shortcomings of our societies,”Kawam explains.

This year, as part of its global CSR program, GES has launched the ‘One Shipment One Dollar’ campaign, an initiative that seeks to help underprivileged children get access to education. As part of this campaign, GES will be donating 1 US Dollar for every shipment executed between March 1 and August 31, 2017, across all of its global offices. Employees, partners, and customers worldwide are also encouraged to support this initiative by donating clothes, shoes, toys and accessories to these children. Additionally, GES has recently collaborated with Emirates Wildlife Society in association with WWF (EWS-WWF), a leading local environmental NGO which is committed to protecting the UAE’s natural heritage, in support of their long-term conservation initiatives, and reflecting GES’ commitment to reinforcing its responsibility towards protecting biodiversity and preserving natural resources for the future generations. “The logistics industry works together as a network, and we hope to leverage our global connection to collaborate with fellow companies that share this common goal of securing a better future for our children while building sustainable businesses.” concludes Mustapha Kawam.

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Pushing the envelope Munawar Shariff talks to Santanu Datta, Director Global Sales, ATS World about how much the company has grown and how it plans to expand even further

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o say Dubai has undergone tremendous growth over the years, would be an understatement of epic proportions. The emirate enjoys a favourable place as a significant player in international trading and transport logistics. The rising exports and imports have driven the supply chain and logistics market and the Middle East, led by the UAE, has become one of the most important hubs in the ensuing changing global trading lanes. This, in turn,

has also led to the set-up of companies specialising in logistics, transportation, freight handling, warehousing, packaging, and supply chain management in the region to meet the growing demand. With Expo 2020 approaching, it has brought about many movements in the region and globally in the logistics industry. The Mena Trade & Logistics (T&L) industry generated AED 268 billion (US$73 billion) in 2015 (representing 3.4 per cent of the GDP), of which the GCC T&L industry


Jebel Ali Port, Dubai, UAE

accounted for US$47 billion (representing 3.3 per cent of the GDP), which is very low when compared to other regions of the world. Nevertheless, T&L is emerging as one of the key drivers of economic activity in the region, especially in the GCC, whereby it now constitutes a major industry sector. As per recent studies, the world trade volume growth was just 2.5 per cent in 2016. It’s expected to increase to 3.6 per cent in 2017. Although new trade restrictions reached a post-crisis high in 2016, encouragingly, most

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emerging markets still have a large untapped potential to move up the value chain, by shifting to more complex and higher domestic value-added products. Suffice to say, the logistics industry is a dynamic one. ATS World has been navigating the treacherous waters of the logistics industry in the region for the past 26 years.“We started in 1991 in Dubai as a freight forwarding company and then grew into domestic transportation in the UAE and across the GCC,”says Santanu Datta, Director Global Sales, ATS World.“The company has grown by leaps and bounds ever since. Growing from strength to strength, its range of services has continuously expanded over the years. This year marked our 26th year in the industry and as a multimodel organisation that has established itself as a leading NVOCC in the region. We specialise in air, road, sea freight, warehouse distribution, land transportation, liquid terminal and on-site logistics.” The company boasts its own fleet of 385 trucks and trailers, further sub-divided into flat beds, box trailers, curtain trailers, reefer

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trailers, fuel tankers, 10-tonne trucks, and low bed trailers etc. The availability of an in-house land transport division facilitates prompt service to clients by understanding their precise requirements and delivering on them through superior quality of service and timely deliveries.“Our latest project has been the Raftaar Terminal – the new storage tank terminal that’s strategically situated in the emerging oil storage and trading location of New Mangalore Port, India,”says Datta. “The Raftaar Terminal complies to the Indian Petroleum and Explosives Safety Organisation (PESO), Oil Industry Safety Directorate (OISD) norms and with all International safety

and standards. The uniqueness of the terminal is in its construction, which is stainless steel with a capacity of a 316-litre storage tank and jetty pipeline in Mangalore suitable for all acids. It can handle a wide range of petroleum products Class A, B and C like Naphtha, gas oil, motor spirit, para-xylene, methanol and petrochemicals products, too.” Besides its four offices in the UAE (Dubai, Jebel Ali, Abu Dhabi and Ras Al Khaimah), the logistics company is also present in Bahrain, Oman, Belgium, US and India – where it handles tank terminals.“In Oman, we specialise in transportation, freight forwarding, warehouse and distribution,”Datta adds.“In


Port of Sultan Qaboos (PSQ) in Muscat, Oman

Bahrain, we specialise in transportation and logistics. In Belgium, we specialise in onsite logistics, warehouse and distribution, platform logistics and transportation, freight forwarding and in the United States, we offer transport and logistics and freight forwarding.” The company is also exploring the scope of air cargo agencies in the said countries in order to connect some global areas such as Africa, Latin America etc., which are otherwise territories that are not very well connected. The key to their operations outside the UAE, however, is India.“We operate tank terminals for liquid storage and distribution,”Datta says. “We are also in the process of setting up a customs clearance office at the Sila border. We have assisted with setting up a petrochemical manufacturing plant in Belgium and Bahrain as well as handled the platform operations of the Belgium plant.” Datta claims that the company’s USP is hands-on execution, round the clock customer service and cost-effective solutions to its customers, which can bring positive value to its client’s business. Datta says,

“Unlike many of our competitors, we are an asset-based company. Whether it’s owning trucks, warehouses, liquid terminals, etc., we have our own transportation services which range from flatbed, curtain, closed box, and temperature-controlled, which are GPSequipped. Our global network of various active worldwide agencies leads to a timely solution for this dynamic logistics industry.” In terms of keeping up with the sustainability trend, ATS has one of the youngest fleets in the UAE for cargo handling which are low in emissions as most trucks are equipped with Euro 5 engines.“We at ATS always believe in being abreast with technology and the latest trends in the business,” Datta says.“That ensures our clients, have a seamless process and continue their association with us as they have always done” Of course, there’s always scope for more. Datta claims ATS has a few opportunities in many different countries – be it GCC, Levant, or North Africa. He says the company currently aims to grow and

consolidate across the GCC first before it “spreads its wings” to other areas in the Middle East. They do, however, expect to open in Saudi Arabia by 2018. The expansion hinges on efficiency and lowering costs.“We strongly believe in investing in our resources, which are the right individuals who are assets to our organisation to ensure we get the best results,” Datta says.“We also keep a timely check and pay constant attention to every job aspect that will improve productivity, which leads to cost reduction. All our trucks are serviced and repaired at our in-house facility in Ras Al Khaimah.” As an organisation, ATS has grown by leaps and bounds. In the market where industry growth is almost stagnant, the company and its leaders remain very positive of the years to come.“We always strive to grow at least by 15-20 per cent year on year by both volume and revenue,”Datta says.“We are expanding our team with more professionals as well as bringing technology to meet the external demand and internal target.”

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mnichannel, with e-commerce, is cascading across worldwide, affecting how retailers and manufacturers sell. Omnichannel is selling duality. In turn, it requires supply chain duality. Online selling success is about meeting and exceeding customer expectations. It is driven by supply chain management. The onesize-fits-all supply chain cannot efficiently handle both store/brick retail or plant manufacturing and online/click sales. It is central to the global supply chain revolution. All these elevate the need for a comprehensive total supply chain approach that reduces costs and working capital investment while improving service and market positioning, including omnichannel. This is transformation. Manufacturers and retailers need a supply chain strategy that recognises the differing requirements of factory/store and e-commerce. The strategy must work at the corporate level, at the division/ region level, and at the local level. It should integrate these levels. The new supply chain must have strong technology and process capabilities as essential foundation elements. Toward that end, the overriding question is: What is the goal? Goals and objectives on optimising supply chains canter around cost reductions, greater visibility, increased buying leverage, better efficiency, improved control, leaner inventory and increased agility with time compression, reduced capital exposure with extending inventory (also called, being inventory rich) and better services. Next, comes recognising issues in supply chain optimising execution. Things like a lack of clarity on the length and breadth of the supply chain, infighting among divisions and stakeholders, system or process limitations, agility of demand and supply functions to deal with moving targets and lack of holistic visibility, ownership, and influence could be some of the hindrances. Bringing in change is never easy, however, here’s what could help ensure change: Parties being clear on the areas within project/transform scope and outside of scope, consistency in the way the project is described, key fundamental questions are asked and answered and that stakeholder goals are captured and built into the program/project.

The price of perfection

If you really want your supply chain to run in peak condition, you’ll need to know how to optimise it across the Upstream, Mid-Stream and Downstream channels. Tom Craig, President, LTD Management, talks about the factors to consider to achieve this

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It’s worth noting that there are three parts to supply chains – the Upstream, the MidStream, and the Downstream. The three parts are interrelated and integrated.

Upstream scope Stakeholders include buyers, procurement, suppliers, manufacturers, logistics, planners, finance, risk marketing, sales. Example of Considerations: Vendor managed inventory, lean as to number of suppliers, switch to near and offshore approaches, trade-offs for lead time vs cost, revise buying terms, create upstream consolidation hubs, align buying volumes to optimal shipping modes, evaluate direct to store/market options, implement upstream value-added services and store ready processes, centralized demand planning and transport functions, adapt omnichannel program. Targets: Reduced costs, increased visibility and control, leaner mid and downstream supply chains, ability to re-route/adjust to match demand, duplication, and cost avoidance. Impact: Highest impact on supply chain cost, requires strong systems and supplier coordination possibly via a control tower type of solution. You should know that: Supply chain success begins with the Upstream supply chain. Problems here create exponential problems in the Mid-Stream and especially the Downstream segments. Retail supply chains, especially with omnichannel, are about “pull”, not push, product through the supply chain. The pull

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It’s worth noting that there are three parts to supply chains − the Upstream, the Mid-Stream, and the Downstream. The three parts are interrelated and integrated

demand makes supply chain integration and the Upstream supply chain more important. The majority of supply chain cost is determined by the efficiency of the Upstream processes and how the Stakeholders interact. A focus on this area typically yields greater results and have a positive impact on both MidStream and Downstream activities and costs. Upstream optimization requires a holistic approach to ensure that the concerns and needs of the respective stakeholders are recognized and addressed. It is still possible to break out specific areas of the Upstream supply chain and tackle these for quick wins, such as freight consolidation.


Mid-Stream scope Stakeholders include marketing, sales, logistics, planners, finance, risk. Example of considerations: Review inventory holding points vs flow through or direct to market solutions, optimise SKU range, create internal processes that allow for omnichannel prioritization without bin/ location duplication, increase level of store/ range packs at POS, allow for rounding of demand to optimize four wall activities, sell through vs returns study, invest in technology and mechanization to reduce touch points. Targets: Reduced costs, increased visibility and control, leaner inventory and associated capital, ability to re-route/adjust to match demand, reduced investment in infrastructure and assets, higher velocity throughput. Impact: Reduction in dormant inventory and capital tied up in inventory, assets, and infrastructure; higher service levels to demand points, reduced handling points and capability to expand the range/handle seasonal fluctuations without adding infrastructure. You should know that: The majority of static dwell time is linked to Mid-Stream processes and the ability to flush inventory through the system to demand points. Focus on this area will typically yield improved performance and less obsolescence,

reduce manpower and inventory (capital) costs as processes change to suit the upstream improvements. Mid-Stream optimization requires a process driven approach to ensure that the concerns and needs of the demand partners are recognized and addressed. Mid-Stream change management can be approached on a site, activity, or brand level and can be actioned independently or in parallel to up and downstream activity.

Downstream Stakeholders include buyers, procurement, logistics, planners, finance, risk, marketing, sales, real estate Example of considerations: Creation of “store ready” or “store friendly” configuration packs in Upstream or Mid-Stream processes, hub and spoke transport solutions for key SKUs, intra-store transfers and sell-through options vs returns, outsourced/shared distribution assets, store dressing/replenishment during non-trading hours, environmental packaging options to reduce CBM/unit. Targets: Reduced cost to serve, a reduced environmental impact from optimized routing, delivery and replenishment solutions, reduction in returns, reduced lead time to demand high yield/key SKUs.

Impact: Highest impact on consumer confidence and brand loyalty, directly impacts COGS and optimisation of high-cost real estate, reduces costs and ensures “fresh” seasonal inventory. You should know that: The majority of customer-facing activity takes place in the Downstream areas of the supply chain. A focus on this area will typically yield positive results for the Brand image and less waste throughout the supply chain. Downstream optimization requires a consumer-centric to ensure that the concerns and needs of the respective stakeholders are recognized and addressed. Prior to tackling this area, it is key to understand the sales channel strategies of the brand and prioritization of current and future channels. Optimizing a Supply Chain and its related activities can produce significant savings estimated between 10-30% depending on the baseline migration model and scale/ complexity of the business. Thanks to Robert Sutton at Innova Supply Chain for his great contribution to this. Tom Craig can be contacted on

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We will now be able to deepen this partnership through our codeshare agreement and offer a more seamless and broader range of product and service offerings to our customers

Partnership goals Emirates SkyCargo and Cargolux announce codeshare partnership


argolux Airlines and Emirates SkyCargo have announced that they will be entering into a codeshare partnership for air cargo transportation. The agreement was signed in Dubai by Nabil Sultan, Emirates Divisional Senior Vice President, Cargo and Richard Forson, President & CEO Cargolux Airlines in the presence of Franรงois Bausch, Minister of Sustainable Development and Infrastructure, Luxembourg. Earlier this year, Cargolux Airlines and Emirates SkyCargo announced the start of a strategic operational partnership with the two carriers working closely on a number of operational areas including block space and interline agreements, aircraft charter, hub connectivity between Dubai and Luxembourg and cargo handling cooperation. The partnership has been off to a successful start with Emirates SkyCargo commencing weekly freighter services to Luxembourg from June 2017 and Cargolux transferring handling for their freighter flights at Dubai World Central (DWC) to Emirates SkyCargo in September 2017.

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A senior delegation from Luxembourg visited the Emirates SkyCargo’s facilities (From left to right) Henrik Ambak, Emirates SVP, Cargo Operations Worldwide; Nabil Sultan, Emirates DSVP, Cargo, Francois Bausch

Since July 2017, Emirates SkyCargo has also chartered Boeing 747 freighter aircraft from Cargolux’s fleet. The new codeshare partnership between the two carriers is a progression of the operational partnership under which both carriers would now be able to procure cargo

capacity on each other’s flights and then offer it to their customers under their own airway bills and flight numbers. The codeshare agreement will be applicable for cargo capacity on both passenger, as well as, freighter flights. “Over the last five months, our operational partnership with Cargolux

Emirates SkyCargo signs codeshare with Cargolux

has gone from strength to strength. We have achieved a number of the milestones that we had targeted at the outset,” said Sultan.“We will now be able to deepen this partnership through our codeshare agreement and offer a more seamless and broader range of product and service offerings to our customers.” “I’m excited how well our partnership is developing,” said Forson.“This codeshare partnership is a natural progression in our cooperation and demonstrates the complementarity of both airlines. Our customers greatly benefit from this partnership as we can offer high-quality products and services to more destinations than ever before.” Minister Bausch and a senior delegation from Cargolux visited Emirates SkyCargo’s facilities at Dubai International Airport and Dubai World Central earlier in the day. Emirates SkyCargo and Cargolux will continue to explore opportunities to further strengthen their operational partnership and build on mutual strengths to offer customers the highest standards of air cargo transport services.

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DP World’s plan for

Jeddah Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World, unveiled plans to develop Saudi Arabia’s Jeddah port in support of the Saudi Vision 2030 recently launched by HRH Crown Prince Mohammed bin Salman bin Abdulaziz.

S DP World Group Chairman and CEO Sultan Ahmed Bin Sulayem speaking at the Future Investment Initiative (FII) in Riyadh.

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ultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World was speaking at the Future Investment Initiative (FII) in Riyadh on a panel discussion entitled ‘Dynamic Economies: What are the new ways to solve diversification?’ He outlined the significance of Jeddah Port as a gateway port for the Saudi market and for the region, connecting to major markets in Africa and the Middle East, and that its role as a trade hub can be further boosted by DP World’s vision for its development over the next 30 years. The Saudi Vision 2030 will also play a pivotal role in changing the economic landscape of the Kingdom, wider region and the world. Saudi Crown Prince Mohammed bin Salman also announced at the conference plans to build a new US$500 billion mega


Jeddah Port is a gateway port for the Saudi market and for the region, connecting to major markets in Africa and the Middle East, and that its role as a trade hub can be further boosted by DP World’s vision for its development over the next 30 years

Jeddah Port, Saudi Arabia

project called NEOM that spans three countries. Bin Sulayem commended the visionary project and highlighted how DP World’s plans for Jeddah support the project and will help to realise the potential for economic growth owing to its geographical proximity to major markets and trade routes – 10 per cent of world trade will pass through NEOM, while spurring innovations in the fields of technology, communications and renewable energy. DP World Group Chairman and CEO Sultan Ahmed Bin Sulayem said: “As the first major investor in Jeddah port for almost 20 years now, we are committed to supporting the Kingdom’s effort to leverage its resources and investment capabilities through the development of Jeddah port. Our plans involve increasing efficiencies using innovative tech solutions and making it a semi-automated facility to create skilled

jobs for Saudi nationals, transforming the port to an important gateway to markets serving 500 million people which will make the Kingdom’s ports and logistics services a necessity and not a choice for global trade markets, particularly the Red Sea, which is the blood line of global trade. Jeddah Port is pivotal in facilitating the movement of goods between east and west, and in boosting Saudi exports. “Our proposals are designed at boosting efficiency by enabling local businesses, opening new avenues for growth while supporting the government in achieving the Saudi Vision 2030. This is part of our role as partners – to add value to nations and to deliver sustainable solutions for the benefit of all. “Trade and infrastructure are key pillars in diversifying economies supported by technology and automation as we’ve seen

at our Jebel Ali Port and Freezone, which together contribute to over 20 per cent of Dubai’s GDP. Logistics corridors are another way of making life easier for business. While access to data through digital technology and transparent information are also essential in building governance. “The UAE and Saudi Arabia’s strong historic relations are underlined by the clear vision of its great leaders who have planned a bright future for their people based on solid economic foundations.” DP World operates the South Container Terminal (SCT) at Jeddah Islamic Port, a crucial link in the world’s busy east-west trade routes through the Red Sea and serving a major domestic cargo base in Saudi Arabia. The port is the main import destination for the country, handling 59 per cent of its imports by sea and serving main commercial centres.

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6-7 February 2018 Abu Dhabi National Exhibition Centre Abu Dhabi, UAE

THERE’S ONLY ONE PLACE IN THE MIDDLE EAST where project cargo professionals from around the world meet for new business.

It’s an important opportunity to meet our customers, show our commitment to the region and use it as a building platform for our presence in India, the Red Sea and beyond.”

SERVING THE FULL PROJECT CARGO VALUE CHAIN: Shipper or beneficial cargo owner (BCO) | Ocean carriers Inland carriers (road/rail/inland waterway) | Stevedores Ship agents | Freight forwarders | 3PLs Port/terminal operators | Lashing/packing | Customs Equipment providers | Government entities Financial services

– Matthew Luckhurst, Liner Director, Bahri Breakbulk Middle East 2015, 2016, 2018

To exhibit, sponsor and sign up for event alerts, visit







Survival of the fittest

Global Supply Chain has partnered with Brian Cartwright, Managing Director, Top Management Resources Group (TMR), to run a series of exclusive interviews with industry leaders to provide real time insight on the regional supply chain and logistics sector. Here, Cartwright talks to Christian Juul-Nyholm, MD for Maersk Line, UAE, Iran, Qatar and Oman


hristian has a long history of living and working in the Middle East logistics sector with his first stint from 1997 until 2006. He returned to the region again in 2014 after nine years of working in various countries across Europe and Asia Pacific. Representing the world’s largest container shipping company, Christian was pleased to share some thoughts on current market dynamics which are influencing the supply chain.

What are your thoughts on the changes in alliances between shipping lines and recent mergers and acquisitions? Despite the new alliances, our industry is still fragmented. Over the coming years, we can expect even more consolidation. The alliances will offer an equal playing field for the carriers and there will still be plenty of competitive offerings for shippers. Initially, there might be some disruption to services, as new networks are put in place.

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Is the rise of the mega vessels a major contributor to overcapacity? Mega-ships make sense to reduce carbon footprint and reduce unit costs when demand meets expectations. However, when demand suddenly/unexpectedly drops, the economics become challenging if you are unable to fill the ships. When you order vessels it’s important to keep a relative balance between your current fleet size and the expected market growth. While there was a bit of a frenzy the past years, today the order book is at a 27-year low. Overcapacity in shipping is a common discussion, but what about under capacity in some trade lanes which has raised shipping costs and increased lead times? As a business, you always aim to match capacity to demand to ensure utilisation stays high. The space crunch seen in Europe this spring came from the normal Chinese New Year deployment coupled with an unusually strong demand from Europe to Asia (growth in excess of 12 per cent). Due to the high number of ‘no-shows’, carriers need to overbook vessels every week. A better coordination on forecasting is vital to improve the supply chain. How is Maersk Line contributing to creating more sustainable supply chains? Our customers require sustainable products and we are seeing significantly higher interest in partnership to reduce environmental impact. Firstly, we can influence reducing average pollution per transported unit. If we can ensure that every slot is full every time a ship leaves a region, there would be significant reduction in carbon footprint. Maersk Line continuously evaluates alternative fuels and reduced fuel consumption. Even if sea-freight is by far the eco-friendliest way to transport goods, we can do more. Digitisation is a topic that regularly comes up during my discussions with Supply Chain and Logistics professionals, what are your thoughts on digitisation in shipping, and what actions are you taking in regard to this? We are cognizant that the container industry needs to be in sync with the digitised age. Maersk Line’s focus is clear – making the entire process of getting a container from

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A to B seamless. We are working with companies like IBM, Microsoft and Alibaba to make this a reality in the very near future. This is also perfectly aligned with the UAE government’s focus on being completely digital in the coming five years. What are your thoughts about doing business in Iran as its one of the countries under your remit which has some very unique challenges when compared to the rest? The Iran market represents good opportunities in the coming years. European companies, in particular, have resumed doing business with

Iran, and we expect this segment to experience a significant growth in the next five years. Regardless of who is the first mover, there are ample prospects to do good business in Iran. I am interested to hear your thoughts on talent in the industry, are you finding it difficult to attract and retain people? The company is good at retaining talent. We try to maintain a balanced mix of nationalities from all regions. In terms of attraction, we receive many senior management enquiries from Asia, but lately, we are receiving fewer enquiries from Europe.


Prospects in Europe have improved, causing people to stay put, and attractiveness of Dubai from a compensation/cost perspective has deteriorated in comparison. We experience that attracting candidates with families to come and work here is proving increasingly difficult. Have you been successful in attracting local nationals in the countries you lead? In the UAE, we try to attract more Emirati employees, but as an industry, we struggle to compete with both public and private sectors e.g. banks which are viewed more favourably. Dubai was built on trade/logistics, yet we

still have a challenge to make the industry appear attractive. In Oman, we have a majority of Omanis working.

Brian Cartwright, Managing Director, Top Management Resources Group (TMR), is well-known throughout the international supply chain and logistics sector as a focused and highly proactive business leader, mentor, and thought leader.

Are there any specific initiatives you currently run, aimed at attracting local nationals which are proving successful? We run a global initiative called ‘Go with Maersk’ – every year we hire aspiring young employees into our trainee program and we hope to attract GCC nationals too.

Is Maersk Line involved in supporting local communities through any kind of CSR initiatives? Every winter we run a CSR funfair in Dubai. We invite around 1,000 customers and their families. Our employees work the stands and proceeds are donated to projects through government-approved charities. It’s a great day for the organisation to engage with customers and a great motivator for the team giving something back to the community.

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Riding the wave ORG Logistics of Dubai is planning to open new markets in China and North Africa with revenues reaching AED 400 million (US$ 108 million)


ubai-based Org Logistics, the world’s leading shipping company is looking to significantly increase its global footprint. The company planning to expand in markets like China, Hong Kong, and Egypt, as its revenues are approaching US$ 108 million.

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Established in 2005, the logistic powerhouse specialises in prominent services in the field of shipping, imports, and exports. Current exports per month are at 1,000 tonnes to Hong Kong, Europe, and America, while imports are at 900 tonnes for the same region, including Saudi Arabia, Kuwait, Iraq, Libya, Tunisia, Morocco, Algeria, and Egypt.


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“Logistics continues to play a major role in helping the region sustain its growth. A significant portion of the world’s cargo moves through the Middle East, and businesses now expect logistic companies to be a one-stop-solution for all their cargo needs. As market leaders, we have a thorough knowledge of how to efficiently help our clients to connect with markets and move their goods globally, while providing them 24/7 support,” said Mohammed Al Gohary, Chief Executive Officer, Org Logistics. “As a company, we see significant growth opportunities here in the region and globally. We are constantly looking to expand our footprint, and offer world class services and business practices. We pride ourselves on being versatile, and our operations are backed by state-of-the-art warehouse facilities, and IT infrastructure,” added Al Gohary. Org Logistics, part of the Multinational group Elgohary, is not just a business that sells transportation, but it offers various

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levels of specialized services. The company prides itself on being a one-stop-shop for all logistics solution either international or domestic including: Warehousing and distribution (state-of-art facilities for storage and distribution of general and special cargo; warehouses are insurancecovered), custom-warehousing, hold and release shipments, air freight (delivering any destination all over the world), overland transport (24/7 land transport service across the middle east), customs clearance (customs brokerage services), shipments clearing (JAFZA and DAFZA), local market services (import), and air charter (provides private cargo flights for urgent shipments). Today, Org is a certified member of WCA World, FIATA, and NAFL offering 24 hours service. Org is the only company in DAFZA that provides service to valued clients 24/7, and the only logistics company in Dubai Airport Free Zone (DAFZA) that is equipped with an X-ray machine and insurance covered warehouse, which is designed to inspect goods and adhered

the highest standard of safety with the approval of FANR (Federal Authority for Nuclear Regulations). Org Logistics also offer services like cross trade, where its customers can ship goods (from and to) outside of the UAE. The goods can be brought to other countries in America and Europe, and then sent back to the Middle East and Africa. The company also has three giant stores in the DAFZA free zone, and operates a customs warehouse outside of the free zone as well, in Dubai, and insurance for the stores are offered from major companies. Other services include charter flights, and business hold and release of goods. Furthermore, in 2016, Org was awarded as a Cargo Agent of the year 2016 by UAE-based carrier FlyDubai. The company’s logistic partners include the likes of and Amazon, and Org is the shipping agent for many global brands, among them Samsung, Nokia, and Hisense, and the company follows the procedural instructions established by the international shipping institutions.