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September 2017 Issue 40

ENHANCING THE BUSINESS OF LOGISTICS

DRIVING CHANGE Lift truck operators

An app for your fleet? Not one but two apps

Materials handling 2017 The US$5 billion industry by 2020

The bespoke supply chain A result of 3D printing


Sao Paolo •

• Prag

Paris •

• Kano

Riga •

Antananarivo •

• Johannesburg

(Madagascar)

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

www.turkishcargo.com | +90 850 333 0 777


Explore our award-winning solutions For over five decades, Almajdouie Logistics has been providing end-to-end bespoke solutions to the major industries operating in our region. Through one of the largest fleets and facilities in GCC, supported by over 4,000 dedicated team members, and a global network, we provide our customers with an innovative, flexible and reliable service to support their businesses. Together, we reach new heights in logistics.

Tel +966 13 8195555 Customer Service 92 002 9221 logistics-sales@almajdouie.com

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


The fork lift operator SIGNATURE MEDIA FZ LLE P. O. Box 49784, Dubai, UAE Tel: 04 3978847/3795678 Email: info@signaturemediame.com Exclusive Sales Agent Signature Media LLC P.O. Box 49784, Dubai, UAE Publisher: Jason Verhoven jason@signaturemediame.com Manager: Brian Cordeiro brian@signaturemediame.com Managing Editor: Munawar Shariff munawar@signaturemediame.com Art Director: B Raveendran ravi@signaturemediame.com Production Manager: Roy Varghese roy@signaturemediame.com

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

Enough can’t be said about this integral person in your warehouse. He is the one who can improve the way forklifts work today and should work tomorrow. Since he operates it all through his work day he will be able to tell you how the forklift can be improved upon, how safety can be improved during operations, how the forklift can work better and improve the way the warehouse can be more efficient. Our cover piece talks about this very important role and how it determines business growth. (page 22) Materials Handling Middle East will begin early next week and according to research by analysts Frost & Sullivan, the market revenue for materials handling equipment in the GCC, which was worth US$ 3.78 billion in 2014, is set to maintain a CAGR of over four per cent while reaching an estimated US$ 4.8-5 billion in revenues by 2020. Saudi Arabia, with about 46 per cent and the UAE with 35 per cent, make up the largest markets in the region and are expected to continue to spearhead market expansion going forward. Don’t miss it. Our futures will be very different from our today, as is always the case. The manufacturing industry is moving fastest in a new direction - that of 3-D printing, and consumers getting customised products and with unprecedented speed. The age of mass customisation is finally here, backed by a new kind of supply chain. All this and much more packed into our September issue. Enjoy it and we will see you in October, InshaAllah!

Munawar Shariff Managing Editor munawar@signaturemediame.com 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.

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September 2017 Issue 40

ENHANCING THE BUSINESS OF LOGISTICS

22 06 News 16 Region report - Russia and the CIS Heading towards growth Recovery has arrived in the Commonwealth of the Independent States (CIS) and growth is now hovering at the highest level since 2013

22 Cover Lift truck operators: Drivers of change The importance of the fork lift operator cannot be stressed enough. Josh Bond, Senior Editor, www.mmh.com writes about this integral occupation

32 The four-point plan to supply chain dominance Tom Craig, President, LTD Management, lists out the four supply chain metrics for 4 SEPTEMBER 2017

manufacturers, retailers, and distributors that could revolutionise their business

36 How TruKKer.ae is disrupting the goods transport sector TruKKer.ae CEO, Gaurav Biswas, talks about his company’s phenomenal growth and how he plans to maintain the pace

38 Robust growth at Sohar Port Mark Geilenkirchen, SOHAR Port and Freezone CEO, speaks about the innovations in the pipeline for the deep-sea port

42 Unprecedented growth The GCC’s materials handling equipment market is expected to reach US$5bn in revenues by 2020

48 Need for speed 3D printing is beginning to bring personalised manufacturing to scale, hence a new “high-speed bespoke” supply chain model is following suit

54 The hope for a more sustainable service Arne Berndt, owner/adviser at SoundPLAN, a world-leading mapping software manufacturer, explains the benefits of using software-produced maps to help mitigate emissions

58 Full throttle Janardan Dalmia, Co-Founder and CEO of Dubai-based start-up Trukkin, talks about the platform’s incredible rise and future plans for the region

60 Unwind The future of the warehouse Most manufacturers to adopt wearable technology by 2022


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: Trucks.MercedesBenzMENA.com


DAE delivers new A320 to start-up airline flyadeal Dubai Aerospace Enterprise (DAE) Ltd. has announced the delivery of an Airbus A320200 aircraft to new customer, flyadeal. The delivery took place at the Airbus delivery centre in Hamburg, Germany, and represents the first aircraft in the flyadeal fleet. The Dubai-based lessor has agreed to lease eight Airbus A320 family aircraft to the new Saudi Arabian low-cost airline. All aircrafts will come equipped with

dnata commits to a greener future Since the launch of the recycling programme this year, over 80 units of GSE have been renewed at the maintenance base, reducing waste generated from GSE by 110 tonnes while passing all safety and quality checks. The projection for 2017 is an estimated 140 pieces of GSE being recycled, saving the company approximately over AED 13 million (about US$ 3.5 million), and reducing waste by 250 tonnes. “Our reality is that sustainability is a necessity, not a choice, and at dnata, we endeavour to meaningfully fulfil our environmental responsibility wherever we operate. We are extremely motivated by the success of our GSE recycling programme in Dubai. It provides us with a tangible way to reduce our carbon footprint at the source, rather than carbon offsetting as a way of

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merely clearing the corporate conscience,” said Gary Chapman, President, dnata. Other initiatives for a greener operation also include the conversion of all forklifts in dnata’s cargo operations to electric. Out of a fleet of 102 forklifts in Dubai, currently, already 73 are electric, with the rest being diesel powered. The plan is to replace all current diesel forklifts by the end of 2017 with electric alternatives – reducing the carbon footprint at dnata’s cargo operations by 80 per cent, generating a fuel savings (consumption) of 200,000 litres per year, and CO2 emissions reduction of 47 tonnes per year. Globally, over 300 pieces of environmentally-friendly electric tow trucks, forklifts, conveyor belts and push back tractors are in dnata’s operations and this number is on the rise.

CFM 56-5B4/3 PIP engines. These modern, fuel-efficient planes will be delivered in 2017 and 2018 and are part of a direct order DAE has with Airbus. “DAE is pleased to welcome flyadeal on-board as a new customer. This transaction demonstrates our capital strength and our ability to provide comprehensive solutions to airline clients,”DAE Chief Executive Officer, Firoz Tarapore said.“We are delighted to be able to support flyadeal’s fleet strategy as it begins operations, and we look forward to working with the airline to fulfil its fleet ambitions, going forward.”


Expansion, investments to drive UAE logistics sector growth DP World announces solid financial results Global trade enabler DP World announced solid financial results for the six months to 30 June 2017. On a reported basis, revenue grew 9.6 per cent and adjusted EBITDA increased by 4.2 per cent. Adjusted EBITDA margin was 53.4 per cent, delivering profit attributable to owners of the Company before separately disclosed items, of $606 million and EPS of 73.0 US cents. On a like-for-like basis, revenue grew by three per cent and adjusted EBITDA increased by seven per cent, adjusted EBITDA margin of 54.8 per cent, attributable earnings up by 15.8 per cent, reflecting the improved trading environment. “In the first half of 2017, we have invested $595 million of capex in key growth markets, and announced over $170 million of acquisitions in our maritime business, which offers significant growth opportunities. These investments leave us well placed to deliver on our strategy to strengthen our port related services and capitalise on the significant medium to long-term growth potential of this industry,”said DP World Group Chairman and CEO, Sultan Ahmed Bin Sulayem “Our balance sheet remains strong and we continue to generate high levels of cashflow, which gives us the ability to invest in the future growth of our current portfolio, and the flexibility to make new investments should the right opportunities arise as well as delivering enhanced returns to shareholders over the medium term,”he added.

Expansion projects and new investments are expected to fuel growth within the UAE’s logistics sector over the next five years, according to a recent analysis by the Dubai Chamber of Commerce and Industry. The positive outlook is supported by expectations of strong growth in the country’s air and sea freight markets. The analysis, based on recent data from Business Monitor International, forecasts the UAE’s air freight market to expand by a compound annual growth rate (CAGR) of 4.8 per cent over the 2017-2021 period. It also showed demand within the country’s air freight market increasing at a CAGR of 8.6 per cent between 2012 and 2016. The UAE’s two leading airports – Dubai International Airport and Abu Dhabi Airport – have continued to invest in expanding and enhancing facilities in recent years. Emirates

SkyCargo recently opened a new pharmaceuticals facility at Dubai International Airport to accommodate growing demand for pharmaceutical and cold storage products. Going forward, the expansion of cold-chain logistics services at both airports is expected to further increase air freight volumes in the UAE. Both Emirates and Etihad Airways have played an important role in air cargo in the UAE and will continue to contribute to increasing air cargo volumes over the next five years. H.E. Hamad Buamim, President and CEO of the Dubai Chamber of Commerce and Industry, explained that the logistics sector is among the key sectors driving the UAE’s economic growth. He noted that recent expansions, investment and improvements within the sector have strengthened Dubai’s position as a global trade hub and enhanced the competitiveness of the UAE economy.

Panalpina juices organic perishables business with Certysis license The fresh avocados that Panalpina ships to European grocers just got a little greener. The Swiss forwarder’s hub at Luxembourg Airport (LUX) has been officially licensed by bio-certification group Certysis to ship organic fruits and vegetables. Panalpina is now the only licensed 3PL to handle organic produce at LUX. Panalpina’s operations at all three hubs – Luxembourg, London Heathrow and

Amsterdam – have direct access to the tarmac, giving the 3PL the shortest connection between aircraft and warehousing facilities. “To be able to sell organic fruits or vegetables in the supermarket, every part of the supply chain, from grower to final distributor, needs to be certified by one of the controlling bodies,”said Quint Wilken, Panalpina’s regional head of Panalpina’s Perishables Europe division.“If the chain

is broken, the product is not allowed to be called organic anymore.” The certification helps strengthen Panalpina’s Perishables Network, which was launched in April this year, which provides a choice of multiple modes of transport for fresh produce, depending on urgency and shipment size. These include temperature-controlled airfreight, seafreight, road and courier services and charter services.

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Sharjah FDI Forum 2017 explores the role of Foreign Direct Investment in the Fourth Industrial Revolution

The second and concluding day of the Sharjah FDI Forum 2017, scheduled to take place on September 20, 2017, under the patronage of HH Sheikh Dr Sultan bin Muhammad Al Qasimi, Member of the Supreme Council Ruler of Sharjah, will address current dominant economic trends, sustainable economies, the impact of technology on education, small enterprises and the UAE’s plans and policies for the future. Themed ‘The Fourth Industrial Revolution’, the third edition of the Sharjah FDI Forum is organised by the Sharjah Investment and Development Authority (Shurooq), and the Sharjah FDI Office

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(Invest in Sharjah) in a strategic partnership with the CNBC Arabia. The concept of the Fourth Industrial Revolution is connected to the automation of industries and decreasing human manpower, where roles will become limited to directing and monitoring. As a result of this, scientific capabilities and aptitude in the current workforce will need to be harnessed in order to contribute to developing technological and digital infrastructure. Many experts agree that there are significant advantages to this revolution, but at the same time, there are many challenges that will face communities as a result of reducing the labour force and

the loss of hundreds of thousands of jobs. “The second day of the Sharjah FDI Forum features an array of significant economic topics that represent the fundamental pillars of the Fourth Industrial Revolution,”said Mohammed Juma Al Musharrakh, Director of Invest in Sharjah.“These topics are key factors in the next phase of development and growth in the emirate. If we harness the pivotal role of start-ups and SMEs we will enhance economic stability and the successful integration between all sectors. This will improve the benefits of FDI and attract more capital, promoting the emirate as the region’s premiere investment destination.”


Total acquires Maersk Oil for US$7.45 billion in a share and debt transaction Turkish Cargo achieved growth without slowing down Turkish Cargo, which offers services to 120 countries all around the world and is one of the fastest-growing air cargo brands, continues to maintain its powerful growth strategy which has been implementing during the last decade successfully, and increases its share in the global air cargo market. Turkish Cargo increased its cargo destinations to 72 by the end of August 2017. Thanks to the aircraft fleet it has leveraged, Turkish Cargo boosted its extensive flight network, and made an indelible impression at the international market with its two Boeing 747-400 F freighters it has included in its fleet. In consequence of the increase in the number of its freighters, as well as the better utilisation of the capacity increased in parallel therewith, Turkish Cargo enhanced its seat capacity utilisation ratios by 11 points. Thanks to the uptrend it has achieved, Turkish Cargo ranked among the top ten of the international air cargo carriers based on the data announced for June of 2017 by the WorldACD. Turkish Cargo, which has accomplished an increase of 24.4 per cent with respect to the revenue and 26.1 per cent with respect to the cargo carried on year-on-year basis, as of the end of June of 2017, maintains its rapid and sustainable growth.

French oil major Total has agreed to buy Maersk Oil from its parent company A.P. Møller – Mærsk in a US$ 7.45 billion share and debt deal which could help it make $400 million in“synergies”a year. Total will gain about 1 billion boe of 2P/2C reserves, 85 per cent, 80 per cent of which is in the North Sea, an area which will help towards the $400 million in annual“operational, commercial and financial synergies,”Total says. The deal will see A.P. Møller – Maersk get $4.95 billion in Total shares, while Total will take on $2.5 billion of Maersk Oil’s debt. Total will gain 160,000 boe/d in production, mainly liquids, production in 2018, rising to more than 200,000 boe/d by the early 2020s. The 2018 production will have an estimated free cash flow break-even of less than $30/bbl. “The combination of Maersk Oil’s North Western Europe businesses with our existing portfolio will position Total as the second [largest] operator in the North Sea with strong production profiles in UK, Norway

and Denmark, thus increasing exposure to conventional assets in OECD countries,”said Total chairman and CEO Patrick Pouyanne. “Internationally, in the US Gulf of Mexico, Algeria, East Africa, Kazakhstan and Angola there is an excellent fit between Total and Maersk Oil’s businesses allowing for value accretion through commercial, operating and financial synergies. The deal will also see Total take over operatorship and 31.2 per cent ownership of the DUC producing assets in Denmark. Total says the deal will result in consolidating Total’s US Gulf of Mexico presence with the Maersk Oil interest in the Jack development in the Wilcox formation, make it the second largest IOC in Algeria by production, complement its position in East Africa via Maersk Oil’s Kenya assets, strengthen its Kazakh business via addition of operated production, offer potential upsides in Angola and Brazil and enable the pooling of Total and Maersk Oil geological and operational expertise in Middle East - North Africa Region.

DHL eCommerce gets logistics technology platform - FarEye On Board FarEye, a Logistics Management Solution became a partner of choice for DHL eCommerce to enhance its customer experience, optimise its resources and deliver its brand promise ‘real-time’. DHL eCommerce is a division of the world’s leading logistics company Deutsche Post DHL Group. The Group generated revenue of more than 57 billion euros (about US$ 69 billion) in 2016. It supports business processes with mature e-commerce shipping solutions and technology platforms that help enable various online businesses. FarEye’s platform became

an apt fit as it seamlessly integrated with the organisation’s existing systems and made the IT infrastructure flexible and agile. Being a SaaS platform, FarEye gave DHL eCommerce the flexibility to the scale-up and down depending on the demand levels, which gave them an edge to adapt quickly to any work environment. “With eCommerce growing at such a rapid pace we see a fantastic opportunity for high-quality solutions that will offer a great customer experience and more choice, convenience and control for online shoppers,”said

Charles Brewer, CEO DHL eCommerce.“FarEye’s platform is scalable, futureoriented and flexible. With FarEye we can deliver ‘delight’ by having complete visibility of the logistics movement and keeping customer informed at every step, ‘real-time’.”

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Etihad Aviation Group recognises partnership with women for Emirati Women’s Day Etihad Aviation Group (EAG) is celebrating the third annual Emirati Women’s Day with a series of events to highlight this year’s theme, Women are partners in giving, in line with the UAE’s 2017 Year of Giving initiative. Technical Engineer Mariam Al Obaidli’s

talent and passion were identified by the company four years ago when she was offered the opportunity to join the Etihad Airways Technical Engineer Programme, as part of the airline’s investment in the development of UAE national capabilities. She is one of 42

DAE completes acquisition of AWAS Dubai Aerospace Enterprise (DAE) Ltd. completed the acquisition of the AWAS group of companies. The propels DAE into

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the top tier of global aircraft lessors. DAE will now conduct its aircraft leasing business using the DAE Capital brand name.

Emirati women completing their two-year, onthe-job training in order to obtain their GCAA Aircraft Engineering Licenses. Mariam was joined on the panel by an Etihad lawyer, pilot, and airport manager, who shared their own experiences of partnership with the audience. “Our constitution declares that men and women are equal in their rights and obligations. It provides equal access to education, healthcare and jobs. Her Highness, the mother of our nation, is the champion of our success, securing our indispensable role as an active driving force in the nation’s sustainable development,” Amina Taher, Vice President of Corporate Affairs, Etihad Aviation Group, said.“As a company, we foster the talents of our women and men; we encourage them to work together to promote innovation, to mentor their junior colleagues, to volunteer in the community and to give to charity. In a corporate environment, it is also important we stand together to develop not just our company, but the UAE and our society.” Etihad Aviation Group employs 2,859 Emiratis – 1,462 women and 1,394 men – in the UAE and around the world.

DAE Capital now features an owned, managed and committed fleet of approximately 400 aircraft with a value of over US$14 billion, full-service capability to 117 airline customers in 57 countries from offices in Dubai, Dublin, Singapore, Miami, Bellevue and New York, and over three decades of experience in the global leasing market. “This acquisition of the best-in-class AWAS platform provides DAE with an enhanced market position. This combined with our capital strength and our committed long-term ownership will allow us to provide a more comprehensive range of aviation fleet and financing solutions to our clients across the globe,”DAE Chief Executive Officer Firoz Tarapore, said.


Turnkey solutions for tomorrow’s air cargo intralogistics

ACUNIS, the joint venture of Unitechnik and AMOVA, is showcasing solutions for air cargo intralogistics at inter airport Europe in Munich. One of the projects the company will feature is the air cargo terminal built for Ethiopian Airlines. The facility at the airport in Addis Ababa began its operations in June 2017. ACUNIS is responsible for planning the entire terminal and for implementing its technical equipment. Transparency throughout all processes in air cargo terminals is provided by the new release of the ACUNIS Inventory Control System (ICS) UniWare Cargo which will be unveiled at inter airport Europe for the first time. The solution now integrates manual and automatic warehousing for a cargo terminal even better in a single system. The system maps the entire logistics process

within the facility – from the acceptance of the air cargo containers at the dolly dock to the loading of Euro pallets on trucks. The new software also fully shows all processes related to import, export and transit, including storage, transport and setting up and dismantling of air cargo containers. Employees are informed of the location of the goods and the next handling steps via handheld terminals, stacker control systems or mobile devices. A zoom visualisation of the facility provides an overview of the entire cargo terminal. It shows the details both of the automatic as well as the manual zones – even on tablets. The ICS uses the IATA standard “CargoIMP”to communicate with the cargo management system and thus seamlessly integrates with the higher-level software.

A quarter of India’s energy demand can be met with renewable energy India can raise its renewable energy use to meet a quarter of the country’s total final energy demand by 2030, according to the findings of a report presented by the International Renewable Energy Agency (IRENA). Renewable energy prospects for India, a study from IRENA’s REmap programme, outlines action areas that can unlock India’s vast renewable energy potential, ensure clean and sustainable energy for generations to come, and enable the country to fulfil its pledges under the Paris Climate Agreement. Renewable energy prospects for India describes how solar energy will play a vital role representing the

second largest source of renewable energy use with 16 per cent, followed by the wind at 14 per cent, and hydropower at 7 per cent of the country’s total final renewable energy use by 2030. Biofuels – which can be used across the end demand spectrum, such as for transport, electricity generation and heating – would account for 62 per cent. “With one of the world’s largest and most ambitious renewable energy programmes, India is taking a leading role in the energy transformation both regionally and globally,” said IRENA Director-General Adnan Z. Amin.“India possesses a wealth of renewable resources, particularly for solar and bioenergy

development, which can help meet growing energy demand, power economic growth and improve energy access, as well as boost overall energy security.” Increasing renewable energy deployment could save the economy twelve times more than its costs by the year 2030, creating jobs, reducing carbon dioxide emissions, and ensuring cleaner air and water, with savings on health-related costs. Furthermore, the renewable energy technologies identified in the report would lower the demand for coal and oil products between 17 per cent and 23 per cent by 2030, compared to a business as usual scenario.

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Infor amplifies customer service by delivering access to rich, personalised, actionable information

AED 200,000 awaits Business Excellence Awards Winners Ras Al Khaimah Economic Zone (RAKEZ) Business Excellence Awards 2017 recognises companies for their outstanding excellence, which played a key role in the economic development of the emirate of Ras Al Khaimah. On its fourth year, the prominent awards programme comes back with exciting addition for the participants as it is set to give away a total of AED 200,000 (about US$ 54,000) cash prizes to the winners. Ramy Jallad, Group CEO of RAKEZ, RAK Free Trade Zone and RAK Investment Authority, noted that the business excellence programme has enhanced the brand image of several companies over the years.“Winning an excellence award certainly differentiates a company from its competitors, which is very important in today’s competitive business environment. I always encourage our clients, from entrepreneurs and SMEs to large

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corporations, to take part in the Business Excellence Awards,”Jallad said.“We are proud of our expert panel of judges from International Performance Excellence (IPE) who will be conducting comprehensive evaluations to identify the best free zone and non-free zone companies in each category.” There will be seven categories in the awards: Best New Startup, Best New Technology, Best Small Business of the Year, Fastest Growing Company, Best Industrial Company of the Year, Best Contributor to RAK Development and Best Corporate Social Responsibility. For more information about the awards, and to participate, RAKEZ clients should complete the application form available on rakezawards.com. Closing date for entries is on 31 October 2017 and the announcement of the winners at a grand Gala event will be on 25 January 2018.

Infor, a leading provider of business applications specialised by industry and built for the cloud, announced the availability of Infor Concierge, a powerful self-service tool for customers that simplifies access to important sites, content, and resources within Infor. Developed in partnership with the Infor Customer Experience Board this tool provides Infor customers with access to updates on support incidents, quick views and voting on product enhancements, dates and information on productspecific education classes and webinars, and one place to find all product documentation. By having customers weigh in on design specification, development, testing and approvals, Infor was able to infuse the voice of the customer directly into Infor Concierge. Every user can personalise their home screen, have instant access to information about their Infor services and solutions at any time, and control exactly who within the organisation can view what information. In addition, users can connect with other users in Infor Communities and e-mail or call designated Infor contacts from within the application. “Infor wants to make sure that we are the easiest enterprise software provider to work with when it comes to understanding all aspects of an organisation’s interactions with Infor. Giving our customers access to this kind of information allows them to resolve business issues faster and get the information they need and want at any time, without having to deal with multiple calls and emails,”said Tarik Taman, general manager, IMEA, Infor.


Mars Hypermarket feeds Oman’s US$ 4 Billion supermarket sales Oman’s hypermarkets are the main driver for food sales, delivering 70 per cent of total grocery store sales in Oman, according to Alpen Capital. As a result, Omani supermarket and hypermarket sales are set to grow by 15 per cent from US$ 3.4 billion in 2016 to US$ 3.9 billion by 2018, according to food and agriculture research firm Farrelly & Mitchell. GCC supermarket and hypermarket sales will grow 19 per cent to US$ 49 billion by 2018.

As part of the partnership, Mars Hypermarket, one of the GCC’s largest hypermarket chains with over 1,800 employees in Oman and the UAE, will deploy a wide range of digital business solutions running on the in-memory SAP HANA platform to enhance the customer experience, supply chain of thousands of products, and employee engagement. Mars Hypermarket is exploring SAP S/4HANA real-time business suite solutions, mobile apps, and augmented and virtual reality innovations.

“Mars Hypermarket is showing best practices in how to harness the power of digital technology to enhance the complex retail experience. SAP is exchanging global best practices in retail to support Oman’s digital transformation and economic growth in line with Oman Vision 2020,” said Tayfun Topkoc, Managing Director, SAP Oman and UAE. SAP co-innovates with 80 per cent of Forbes Global 2000 retailers, which have increased customer retention by 91 per cent.

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: www.tranzone.ae SEPTEMBER 2017 13


Bahri completes registration of ASLAF under Saudi national flag Bahri, a global leader in transportation and logistics, announced that the Ministry of Transport under the supervision of the Public Transport Authority (PTA) has completed the registration of ASLAF, a Very Large Crude Carrier (VLCC) owned and operated by Bahri, under the flag of Saudi Arabia. The move reinforces Saudi Arabia’s position in the global maritime industry and gives a further boost to Bahri’s efforts to register all of its VLCCs – now numbering 39 – under the national flag by the end of 2017. Bahri had taken delivery of ASLAF in July 2017 to continue its aggressive fleet expansion, and is set to add two more VLCCs to its fleet before the end of the year to reinforce its position as the world’s largest owner and operator of VLCCs. Ali Al-Harbi, Acting CEO, Bahri, said, “Contributing to the economic growth of

Saudi Arabia and enhancing the Kingdom’s reputation and standing in the global transportation and logistics industry are at the heart of Bahri’s mission, and we are proud to be making continued progress toward these goals. Our aim is to get all of our large and mid-size carriers registered under the national flag, which will help sharpen Bahri’s competitive edge in the market while contributing to an increase in bilateral maritime trade volume between Saudi Arabia and other global economies.” The Saudi Arabian flag is raised on cargo and passenger vessels after they are successfully registered with the Ministry of Transport and PTA. They are then inspected and checked regularly in accordance with the standards laid down by international classification authorities accredited by the Kingdom.

Globe Express Services reports eight per cent gross revenue growth for H1 of 2017 Amidst a robust global logistics industry, Globe Express Services has announced an eight per cent increase in its gross revenue across its offices worldwide for the first half of 2017 as compared to the same period last year. The company has attributed the growth to its unwavering commitment to its core value of professionalism, modern technology adoption and integration, and full client confidence in its global logistics expertise. GES particularly cited the continuing evolution of global trade as the main driving force behind its strong business policies and operations from January to June of this year. Since global export and import activities have continued to be on an upswing, major opportunities have been up for grabs for international logistics players. “Vibrant international trade activities are

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fundamental to our growth. Our capacity to address the increasing demand for top logistics services in support of the rising global trade activities definitely influenced our solid financial performance during the first half of 2017,”Mustapha Kawam, President and CEO, GES, said.

Airport privatisation in Saudi Arabia The President of the General Authority for Civil Aviation (GACA) in Saudi Arabia announced all airports in the Kingdom will be privatised. Jeff Youssef, Partner, Oliver Wyman Middle East, who recently co-authored a report called ‘Leveraging the Private Sector to Improve Airport Infrastructure’, said,“Air traffic is expected to continue to grow across the GCC by 4.8 per cent*, which means it will more than double by 2030. We will, therefore, see major investments made to increase capacity and improve service delivery over the coming years. “Governments in the region will need to ensure money is continuously injected into their airports to achieve forecasted growth in the number of passengers,”he added.“The benefits of airport privatisation, if managed diligently, can be wide-ranging. Privatised airports generally record higher performance across customer satisfaction metrics when compared to their government-operated counterparts.” “In most cases, airports operated by public entities do not focus on the customer experience. Privatisation can allow for better adjustments to market changes and will often provide more innovative solutions to customers, resulting in improved outcomes for all.”


Emirates SkyCargo launches new temperature protection solution Jafza attracts 267 new companies during the first half of 2017 The Dubai-based Jebel Ali Free Zone (Jafza) has maintained its position as a preferred investment destination for large-scale industrial and commercial projects coming into the UAE. During the first half of 2017, Jafza attracted 267 new companies from 48 countries around the world, marking a growth of 6 per cent compared to the same period last year. “Jafza’s performance in the first half of the year highlights its position as a major hub for trade and logistics in the region, and one of the engines of economic growth in Dubai and the UAE,”Sultan Ahmed Bin Sulayem, Group Chairman and CEO of DP World, the parent company of Jafza, said.“These results reflect the vision and leadership of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, and the wide range of initiatives to attract foreign investment in accordance with the Dubai 2021 and UAE 2021 plans. New investment opportunities for businessmen and investors created have contributed significantly to the diversification of the economy and the growth of Jafza, helping us achieve the objectives of the national agenda.” Companies of Middle Eastern origin accounted for 59 per cent of the new companies that joined Jafza, followed by Asia-Pacific companies (20 per cent), European companies (13 per cent) and North America and African companies (4 per cent each). The integration of Jebel Ali Port and the Free Zone is a model DP World is implementing across its global network.

As part of its endeavour to offer customers with a wide range of innovative cool chain temperature solutions, Emirates SkyCargo, the world’s largest cargo airline, is rolling out a new white cover solution developed in collaboration with DuPont. Featuring DuPont’s Tyvek Xtreme W50 material, the new White Cover Xtreme will offer enhanced protection for temperature sensitive cargo in hot, cold and wet weather conditions. Emirates SkyCargo has the capability of carrying 17 tons of cargo per flight in and out of Malta, including tons of goods requiring temperature controlled environments. These include flowers and vegetables on the incoming flights and fish and pharmaceuticals on outgoing flights, providing an important link to Maltese companies to and from the Far East and the Middle East. The new triple layered White Cover Xtreme acts as a shield reflecting solar heat when temperatures are high and as a barrier for conduction preventing heat from escaping when temperatures are low thereby helping maintain cargo internally at the right temperature. White Cover Xtreme acts as a single solution that offers a high level of protection in harsh winter as well as summer weather conditions. Over the last few years, Emirates SkyCargo has been working with DuPont to build its portfolio of lightweight thermal cargo covers which offer an effective first level of protection for cargo against external heat and weather fluctuations. An industry pioneer in the use of specialised covers, Emirates SkyCargo introduced ‘White Cover Advanced’ in April 2016 which followed on the earlier success of its ‘White Cover’ solution. ‘White Cover’ is primarily used for protecting perishables such as fruits and vegetables having a higher temperature tolerance, whereas ‘White Cover Advanced’ is used for securing packaged pharmaceuticals shipments which are more susceptible to increase in heat. The new White Cover Xtreme will help shield

temperature sensitive shipments, including pharmaceuticals, which travel through extreme and variable weather conditions from origin to destination. Emirates SkyCargo is the first air cargo carrier globally to be introducing DuPont’s Tyvek® Xtreme™ W50 material in its White Cover protection solutions focused on ground handling. Working together with the world’s leading air cargo carrier with a global network of over 155 destinations, DuPont gets critical feedback to refine the research and development for new products & solution in cargo cool chain. The two companies worked extensively on ground trials for White Cover Xtreme and roll out for customers will begin in late August 2017.

Renewal of collaboration agreement The collaboration between Emirates SkyCargo and DuPont on the new White Cover Xtreme is part of an existing agreement between the two companies to develop new temperature protection solutions, in particular, thermal covers, for the air cargo industry. The agreement was renewed for a further period of two years until 2019 during the Air Cargo Europe event in Munich in May this year. The agreement allows the players to continue developing cost-effective innovative end to end protection solutions for temperature sensitive cargo keeping in mind the needs of the end customers.

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REGION REPORT RUSSIA AND CIS

Heading towards

The recovery has arrived in the Commonwealth of the Independent States (CIS) and growth is now hovering at the highest level since 2013. FocusEconomics analysts estimate that the region is doing very well since the last quarter of 2013 16 SEPTEMBER 2017


REGION REPORT RUSSIA AND CIS

Growth hits nearly four-year high in Q2 The recovery has arrived in the Commonwealth of the Independent States (CIS) and growth is now hovering at the highest level since 2013. FocusEconomics analysts estimate that regional GDP grew 2.2 per cent year-on-year in Q2, building on Q1’s more tepid 1.1 per cent increase and marking the best result since Q4 2013. The positive momentum has become more broad-based throughout the region, and Azerbaijan is the only economy likely to have contracted in the April to June period. Moreover, a strengthening regional and global environment is supporting overseas sales throughout CIS and many countries have seen exports skyrocket this year.

Illuminated Moscow Kremlin and Moscow river in winter morning, Russia

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Preliminary estimates from statistical institutes point to a brighter economic picture for the region overall this year. In Belarus, the economy grew 1.0 per cent in the first half of the year, as activity recovered from a sharp recession, while Kazakhstan expanded a buoyant 4.2 per cent in the same period, aided by robust coal production and oil output. Official data is not available yet for many of the economies in the region, however monthly indicators are suggesting that Armenia’s economy grew robustly and that Russia’s recovery picked up steam.

18 SEPTEMBER 2017

In Belarus, the economy grew 1.0 per cent in the first half of the year, as activity recovered from a sharp recession, while Kazakhstan expanded a buoyant 4.2 per cent in the same period, aided by robust coal production and oil output

Russia’s economy has managed to come back to life this year, despite many challenges including still-low oil prices and economic sanctions. In July, the United States’ moved to tighten its measures against Russia including limiting financial transactions with some entities and asset freezes. While these penalties have the potential to weigh on confidence and, subsequentially, investment in the economy, at the moment it appears unlikely to derail the recovery. Trade data has improved notably this year despite sanctions, and tailwinds from a recovering labour market and less-tight monetary


REGION REPORT RUSSIA AND CIS

to their forecasts, with the exception of Moldova, which experienced a downgrade. Regarding the three countries that are not included in the regional GDP aggregate, analysts raised the 2017 GDP forecasts for Georgia and Turkmenistan, while Ukraine’s outlook was left unchanged.

Belarus

Oil rocking chair on the field. Zhanaozen. Kazakhstan

policy will continue to boost growth in the medium-term. However, heightened political uncertainty could cap the speed of growth in the long-run, especially if the measures deter future investment in the country.

Outlook Prospects brighten after healthy H1 FocusEconomics panelists upgraded their GDP forecast for this first time since February on the back of improved incoming data. Our panel sees regional GDP expanding 1.6 per cent in 2017, which is up 0.1 percentage points from last month’s forecast. The

growth figure is significantly above 2016’s 0.1 per cent and illustrates that the recovery is taking hold in the region, however the expansion is still tepid given the depth of the recession and a number of downside risks linger. Critical to the evolution of the region’s growth is the evolution of oil prices, which could be an upside or a downside risk to the outlook. In 2018, growth is seen rising gradually to 2.0 per cent. This month’s upward revision reflected a hike in growth forecasts for Armenia, Belarus and Tajikistan. Almost all of the other economies in the region saw no change

Government replenishes finances Incoming data for Q2 indicates that the recovery is gaining traction after the economy was hard hit by recession in the past two years. A return to growth in Russia—Belarus’ main trading partner—has yielded positive spillover effects. Industrial production expanded at a solid pace in June, albeit a dip from May’s notable surge, owing to strong exports growth. Robust industrial output growth has more than offset reduced investment in fixed assets in the first half of the year and a preliminary estimate suggests that GDP grew 1.0 per cent over H1 2016. Furthermore, the country has almost secured sufficient external financing to meet its debt obligations until the end of 2018: the government issued Eurobonds worth US$ 1.4 billion in July, while Russia agreed to provide an intergovernmental loan to the tune of US$ 700 million. Growth momentum is expected to pick up this year, underpinned by recovering demand in Russia and stronger growth in CIS economies, which will deliver a vital boost to exports. However, the country’s external liquidity position remains weak. FocusEconomics Consensus Forecast panelists forecast that GDP will increase by 0.7 per cent, which is up 0.1 percentage points from last month’s forecast. For 2018, panelists see growth accelerating to 1.5 per cent.

Kazakhstan Oil revenues allow public infrastructure boom The economy continued to gain momentum in Q2 on the heels of stronger oil production, higher crude prices, a supportive fiscal policy and the economic recovery in Russia. In the first half of the year, GDP expanded 4.2 per cent, marking the fastest acceleration in a year and a half. Coal production, oil output and industrial activities were the backbone of H1’s strong growth. Increasing oil output on the back of production at

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REGION REPORT RUSSIA AND CIS

Crowdy street in Chernivtsi, Ukraine

the massive Kashagan Field is expected to continue to boost growth further down the road. Moreover, higher crude revenues are allowing the government to embark on large-scale infrastructure projects, which should further propel economic activity. Against this backdrop, Moody’s revised the country’s rating outlook from negative to stable on 26 July. Improving dynamics in the oil industry and increasing infrastructure investment will shore up growth through the end of the year. Moreover, stronger dynamics in Russia and the government’s initiatives to diversify the economy away from oil will be positive for growth. Despite some efforts by the government to restructure the sector, the banking system remains the main threat to the domestic economy. Forecasters left Kazakhstan’s 2017 GDP growth forecast unchanged at last month’s 2.6 per cent expansion. In 2018, analysts expect an acceleration to 3.1 per cent.

Russia Recovery accelerates despite rising tensions with the West The economy’s recovery likely kicked into a higher gear in the second quarter and growth is seen coming in at the highest reading since Q4 2013. Data remained bright despite oil prices having fallen throughout the period. In May, exports soared by nearly 30 per cent and unemployment edged down in June. Moreover, consumer confidence stood at

20 SEPTEMBER 2017

the highest level in nearly three years in Q2, aided by the improving economic situation. While the economic picture is becoming brighter, recent events are casting a shadow on the country’s outlook. The U.S. Congress voted in July to step up sanctions on Russia, a move that could undermine confidence in the economy and investment and possibly put a lid on the pace of economic recovery in the long-term. In addition, the low-oil-price environment is weighing on the economy’s growth trajectory and shows little chance of improving, as a production cut deal by petroleum-exporting nations has failed to boost prices. FocusEconomics analysts held their forecasts for the Russian economy unchanged since positive Q2 economic results are being outweighed by concerns over tightening sanctions and still low oil prices. GDP is seen expanding 1.3 per cent in 2017 and a stronger 1.7 per cent in 2018.

Ukraine Pension reforms move closer to being approved The recovery is expected to have sputtered again in Q2, after growth nearly halved in Q1. Bad weather has dampened agricultural production and although industrial output ended the quarter on a bright note by accelerating in June, all-in-all it remained meagre throughout the period as key linkages within the country have been disrupted by the military crisis. On the

political front, the government won an important battle in July and the Parliament gave a preliminary approval on the long delayed pension reform. The reform is mandated by the IMF as a condition for additional funds and has faced fierce opposition, largely over the increase in the retirement age. The reform still must be passed in a final vote in the fall but approval should ensure that the IMF continues to support the battered economy, although a critical land reform is still outstanding. The ongoing conflict in the Eastern regions, banking sector woes and poor weather are continuing to chip away at our growth forecasts. FocusEconomics panelists held the country’s GDP forecast unchanged this month, after four consecutive downgrades and see GDP rising by 2.1 per cent this year. Next year, growth is expected to pick up to 2.9 per cent.

Inflation Price pressures rise in June Inflation picked up in the CIS economy in June, rising from May’s 4.5 per cent to 4.8 per cent. The increase was chiefly due to higher price pressures in Russia. However, the result is still low in a historical context, thanks largely to more stable exchange rates. The analysts we surveyed this month left their forecasts for inflation unchanged and see inflation ending 2017 at 4.8 per cent. Going forward, inflation is projected to be stable and end 2018 at 4.8 per cent.

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ICS M O N O C E FOCUS


COVER

22 SEPTEMBER 2017


COVER

Lift truck operators:

Drivers of

change For all the advances in lift truck technology and fleet management, operators will always be the heart and soul of a fleet. As manufacturers and equipment purchasers place more value on that piece, the role of the operator extends from design to daily use. Josh Bond, Senior Editor, www. mmh.com writes about this integral occupation

T

here’s an area outside Indianapolis where every building has ‘now hiring’ signs,”says Trinton Castetter, internal combustion product planning specialist for Toyota Material Handling U.S.A.“When we talk to customers in that area, everything is about the operator. It’s not enough to pay another 50 cents an hour because you can always be beaten. That operator needs to be so happy where they are that they don’t even look elsewhere.” Operator safety has always been central to forklift design, even if driver comfort only became a focus relatively recently. Operator

SEPTEMBER 2017 23


COVER

feedback is also a standard part of equipment are more productive at the end of a shift,” Koffarnus says.“As ergonomics becomes development and design, although cost and more refined, you can identify the impact of practicality are also part of the equation. those stresses and quantify improvements, However, in the pursuit of every sliver of which make a real measurable change and productivity, it is essential to keep operators have resonated with customers very well. comfortable and efficient throughout an Everybody has seen the light eight-hour shift. As a result, that the equipment needs their perspectives have lately to be as operator-focused as gained tremendous weight. When we talk possible.” “Operator input on to customers “Some of the forwardequipment selection has thinking designs of never been greater,” says in Indianapolis, yesteryear are now Mick McCormick, vice everything is standard,”Koffarnus says. president of warehouse suspension and solutions for Yale Materials about the operator. Seat padding, rear grips for Handling Corp.“There reverse travel and lower step are two drivers leading to It’s not enough height can all reduce fatigue. operators’ ever-increasing to pay another A smaller cowl, thinner involvement in purchasing mast and louvered overhead decisions in the distribution 50 cents an hour guard improve fork visibility environment. One is the because you can and minimise operator industry’s obsession with every ounce of productivity, always be beaten. strain. That’s all well and good, but as the forklift and the second is to make That operator continues to transform into equipment as ergonomic as a mobile office, the job of possible to limit turnover, needs to be so operating one is about more which averages something happy where than bending and reaching. like 35 per cent of warehouse “That’s where telematics workers.” they are that they gets into it,”Castetter says. For this annual Lift Truck don’t even look “We’ve been preaching issue, Modern spoke with that a happy operator is a industry experts to find out elsewhere. productive operator, but it’s how forklifts continue to only a theory until you can evolve and how honouring put numbers to it. With telematics, customers the operator– the true heart of any fleet – is can see they did something for operators and the key to success. now they move more pallets or have fewer incidents. Whatever they are watching, they Development in the details Mark Koffarnus, director of national accounts have a way to track it now and find the root cause. If utilisation tapers at the end of a shift, for Hyster Co., recalls a forklift model maybe it’s operator fatigue, but maybe it’s launched in 2005 with a strong focus on how shipments are scheduled.” ergonomics. Back then, this consisted of From a management standpoint, the cup holders, places to put pens and paper, ability to identify and diagnose all kinds of and other elements that made forklifts like issues is great. But one of the lessons learned a mobile office. More recently, productivity was that the operator doesn’t always need studies indicated that operators tended to quite so much information. perform best over the first 75 per cent of “When telematics started to take off, their shift, and their performance in the last operators had a lot of data coming at them, quarter depended heavily on their comfort and often too much,”says John Rosenberger, levels in the first three. The benefits of cup manager of iWarehouse and global telematics holders were not mentioned. for The Raymond Corp.“The information, “If operators are not being vibrated, whether on the onboard display or a telematics extending necks and arms awkwardly or display, was not necessarily actionable or took otherwise unduly tasked physically, they

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COVER

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COVER

accommodate all add-ons that have been or a lot of time to interpret. Based on operator could be fastened to a forklift.“It’s amazing feedback, we started going back from that and the things they use,”he says.“It truly is a tried to present only what was valuable.” mobile office, and just as an actual office is Some changes were simple, like replacing personalised, the same is true with a lift truck.” numeric battery and gas gauges with icon or How often is the RF scanner used? Does colour-based ones. For telematics displays, a device need to be repeatedly mounted operators can now customise based on and dismounted? Does the same piece of preference. Some might like a prominent equipment need to be set up for paperclock, others want to keep an eye on fork based, bar code and RFID tasks? What is the height. Rosenberger says it gets really balance between preserving sight lines and interesting when the system feeds contextual forcing an operator to reach too frequently? information to the operator. For instance, “Those devices take up visibility real estate, fork height is not relevant when loading but they also impinge on a trailer, but the onboard the envelope of space for scale is. Based on a mix of the operator,”says Brian location, task and operator New generations Markison, director of preference, the display adjusts don’t just want North American sales for accordingly. UniCarriers.“We actually “The other lesson to learn about extended the canopy we learned is screen new technology, forward so that devices consolidation,” Rosenberger can be far enough from adds.“In a car, you used to they want to an operator’s face to read have a GPS on a suction cup, experience it. easily and avoid hitting another mount for XM radio their heads on it. These and then everything on the With workshops, small changes can make dash, but it’s now in one webinars and a big difference. If you central display. We took the do something 50 times same approach.” simulations, it’s an hour, removing a step Even with a single display each time – or even half a for most information, a lot of no longer just step – is important for us to peripheral devices compete book-based rote understand.” for space in an environment where every inch of visibility, learning or death mobility and accessibility The big picture by PowerPoint. is precious. Rosenberger Markison notes that describes the operator-centric, changes within the ergonomic discussions that take place when operator cabin have evolved against the prototyping new forklift cabins and accessory backdrop of reduced operating space for areas in which the team determines how to the forklift itself. Warehouse space is at

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a premium, so aisles get narrower and congestion becomes an issue. Because throughput demands are increasing, it can seem counterintuitive to operators when equipment’s top speeds are lowered. “The operator has to understand that in these newly defined areas, there is a need to reduce speed. Shortening stopping distance by a couple feet is the difference between an accident and near miss,”Markison says.“It’s becoming very common to meter the speed on the vehicle to produce safer operations.” After one manager cut top speed by half, operators complained they needed new equipment because they were so slow. Markison emphasises the importance of an ongoing dialogue with operators about the reasons for change since nobody likes to be surprised. “The day they find out about it should not be the day it’s deployed,”Markison says. “People generally equate driving fast to productivity, but that’s not always true. If you’re only going 30 feet between each pick, there isn’t even the opportunity to get to max speed. On long runs, you might want speed, but then the question becomes, why the inefficient long run in the first place?” Telematics can help those operations that are driven by velocity and demand visibility. But again, the tool is not just for management to coordinate the big picture or minimise unnecessary long runs. Getting the most out of an operator requires engaging with that operator, not merely assigning tasks. “They want the ability to interact with the operator, to instruct them but also get information back from the operator and the lift truck,” McCormick says. “This can be as simple as utilisation, identifying the most efficient routes, or reassigning an operator to a different client if in a multiclient 3PL situation.” Consider the benefits of digital versus paper pre-shift checklists, where issues with a forklift can be immediately identified and acted upon. This prevents maintenance personnel from chasing down an operator and enables them to prep a replacement unit when the operator pulls into the bay. But that idea of immediate two-way information exchange has other uses. “Two-way communication is becoming more prevalent since everyone wants


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COVER

more real-time information, Rosenberger says. “For example, if a manager knows he’s running behind, in the past he had to wait for each person to come back to the office and ask if they want overtime. Now, you can broadcast a message in order of seniority and as soon as he gets three yeses, it’s done.” A more abstract method of two-way communication is a sensor indicating the severity of an impact—which doesn’t always mean running into something, according to McCormick. Such feedback can be useful to

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show operators how gently they engage a load or how smoothly they drive. “When operators see that, then managers start seeing behavioural changes,” McCormick says. “Sometimes operators figure it out by themselves, sometimes during coaching, but we’ve seen several customers where the speed of adoption of better driving habits was surprising. We all knew it was possible, but we didn’t know how quickly it could happen. It’s a simple, non-intrusive guide to make an operator more efficient.”

Virtual training, real results Experienced operators might struggle to change old habits, but with the labour market the way it is, new operators should struggle as little as possible. And if they must flounder, better to do it in a virtual environment. In addition to several third parties, many of the major lift truck brands have begun offering virtual reality (VR) components to their training programs, including some solutions that integrate a VR headset with the controls on an actual forklift. Although it might prove useful to woo tech-savvy Millennials, there


COVER

People generally equate driving fast to productivity, but that’s not always true. If you’re only going 30 feet between each pick, there isn’t even the opportunity to get to max speed. On long runs, you might want speed, but then the question becomes, why the inefficient long run in the first place?”

is widespread agreement that VR forklift training is more than a gimmick. “From a training standpoint, I do think there is a very serious future in getting an operator very familiar with the operation of the equipment and environment well before they ever interact with a real product, people and materials,”says Hyster’s Koffarnus.“That technology is coming hard and fast, and there is a tremendous amount of customer interest.” McCormick agrees, suggesting VR training could make a significant impact simply by enabling temp agencies to screen potential

candidates, establish the basics and allow for much quicker onboarding around peak seasons. VR is being folded into the idea of self-directed education, which empowers the operator to learn at his or her own pace. “New generations don’t just want to learn about new technology, they want to experience it,”McCormick says.“With workshops, webinars and simulations, it’s no longer just book-based rote learning or death by PowerPoint.” Rosenberger says self-directed training components allow operators and managers

the flexibility to remediate those who are struggling or advance those who excel. An individual can access a simulator much more readily than a periodic group session and doesn’t need a trainer or forklift to bone up. “Say an operator was trained two years ago but hasn’t used a certain skill that’s now needed,”Rosenberger says.“Some companies are more progressive and have purchased a suite of training aids for ‘lunch and learns.’ If an operator is eyeing a new position, they can go to a computer during lunch and selfeducate for that next level.”

SEPTEMBER 2017 31


SUPPLY CHAIN METRICS

The four-point plan to supply chain dominance Tom Craig, President, LTD Management, lists out the four supply chain metrics for manufacturers, retailers, and distributors that could revolutionise their business

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F

irst, the metrics discussed here are for manufacturers, retailers, and distributors. This is important and why they are the supply chain metrics. Metrics are a way to measure performance; and, in turn, communicate that information to key executives in the company. Their value is how supply chain management is supporting the direction and strategy of the business. It is important that they present a strategic and tactical understanding of what is happening and how well it is happening. Supply chain management is a process that flows across the organization and from


SUPPLY CHAIN METRICS

suppliers through to customers or stores. The challenge of a supply chain is the length, scope, geographic reach, number of internal and external stakeholders and participants, and overall complexity. No other activity has all this – suppliers and factories around the world and global customers. Supply chains are non-linear, not linear as some project them. There are supply chains within supply chains. Viewing nonlinear supply chains as linear contributes to performance issues and to measuring operations. All these make it difficult to select the proper metrics. There are numerous metrics. Good metrics should measure the

“Supply chains are non-linear, not linear as some project them. There are supply chains within supply chains. Viewing non-linear supply chains as linear contributes to performance issues and to measuring operations.�

performance of the total supply chain, more exactly the process. KPIs (key performance indicators) must be measurable. As a result, numerous metrics are about the logistics components. Some of these are good. However, they do not present a view of the total supply chain. Plus, many have little or no use for the C-suite. Assessing logistics parts is a node-link approach and does not recognize the supply chain process. Supply chain management is a process that is often measured by its logistics costs. That approach is a root cause of issues.

Such computations do not measure the supply chain or its performance and can include factors outside of the supply chain. In addition, the way accounting treats supply chain costs is dated. They go back a hundred years before supply chain management and global activity were recognized. Supply chains are being transformed. The Amazon Effect has stimulated the beginning of a global supply chain revolution. It is moving beyond e-commerce/B2C and is crossing industries and markets.

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Traditional supply chains for retailers and manufacturers face issues with omnichannel, its different markets, and new ways to reach customers, including end-user ones. The underlying expectations are pushing supply chain transformation. In turn, this means improved performance and new metrics. Supply chain complexity raises the question of whether measuring the overall supply chain is sufficient. Segmenting can reflect similar supply chain characteristics, business unit, or other ways. Supplementing the macro performance with segmented KPIs provides understanding and insight to what is happening on both centralise and

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“decentralised” views. It enables seeing underlying factors to the “corporate” measure. Another topic is how many metrics to have. Too few supports the view of a monolithic, linear supply chain. Too many metrics can become measures for measure’s sake. The best four metrics that define supply chain performance are:

Inventory velocity Inventory has been a hot button with the dual challenge of capital tied up and while being able to service sales orders. With omnichannel and meeting customer

expectations, it has become hotter. Aligning inventory and the supply chain network is an additional challenge. Moving inventory quicker through the supply chain has become a requirement. This is also important with inventory planning and with being able to respond to positioning products. This is also a good metric for tactical issues, such as the working capital mandate. It is important for lean and the waste of excess inventory. In many of these cases, inventory is stationary, not moving dynamically across the supply chain. Speed increases the value of inventory while reducing working capital. It is critical with


SUPPLY CHAIN METRICS

category, or other relevant ways for the company is important.

Time compression This KPI ties to inventory velocity and is an integral part of the providing the immediacy customers want. Time is a hidden waste both inside and outside the company and is an enemy of supply chains. Reducing it is important with the new business reality. Measuring time and compressing it must be done across the total supply chain – from suppliers through to customers (and/ or stores). This means breaking it down by inbound, outbound, and stationary – sitting in distribution centres and factories. Remember, time is important with building inventory velocity and minimizing inventory waste. There are two points here. One is that the largest time sector is with the inbound supply chain, especially if there is international sourcing. The other, and often overlooked, is the non-movement part. That is a fixed block of time that is not compressed unless it is recognized.

The challenge to improving performance is ongoing. Success lies at the macro and granular levels. Some of the work ahead includes: • Focus and improve the process • Increase visibility across the supply chain • Integrate the financial supply chain with the product supply chain. • Align the inventory network • Extend the supply chain upstream • Implement advanced integration of process and technology

Perfect order − customer

aligning networks, positioning inventory, and satisfying customer requirements. Inventory control is outdated in a business world defined by speed – from decision making to customer expectations. Supply chain management is pivotal in achieving the many forms of velocity. Also, inventory management, as traditionally understood, has been replaced by alignment and by velocity. Velocity can be measured as turns or days of inventory. It can be applied to finished goods; WIP (work in process), especially that is transferred to another location; and raw materials. Segmenting as to division, product

This is an outstanding metric. The KPI comes from the SCOR (Supply Chain Operations Reference) model. This metric is about the customer. It validates the customer mantra. This is what customer service is – delivery of orders, complete, accurate, and on time. It is implicit in a customer’s doing business with a company. But, as simple as that sounds, firms struggle with it. The new reality of selling for manufacturers and retailers is the customer experience and meeting customer requirements. Service expectations have been elevated. It is not limited to B2C and is spreading across industries, markets, and B2B. Omnichannel is everywhere. Speed is expected. That makes this metric vital.

Perfect order – supplier The supplier is at the opposite end of the supply chain from the customer and the perfect customer order. This metric then creates a yin and yang. Supplier performance – purchase orders delivered complete, accurate, and on time – is very important to supply chain success. This is a fundamental metric. Supply chain performance begins on the inbound side with suppliers. The impact of weak supplier accomplishment ripples throughout the

supply chain and impacts the actuality and fundamentals, both operational and financial, of the company. The four-metrics triumph because they recognize and deal with the entire supply chain and its process. Success with them can mitigate company failures and problems with sales, growth, and profitability. The four metrics have value across markets, industries, and businesses. They are interrelated, connected, and bring cohesion to the supply chain, what it does, and how it does it. These define it and provide a way to see the intricacies and convolutions which can be lost in the daily happenings. They recognize what can be viewed as unrelated parts of the supply chain – when they are not. For example, the two perfect order measures highlight the supply chain. Add the time compression and inventory velocity that recognises the speed which has become a requirement of business. This is especially true for retailers and manufacturers dealing with a duality of omnichannel and its selling to intermediaries, directly to end-use customers at their designated locations, and through ways that have customers coming to merchandise. The traditional ways no longer function as they once did.

SEPTEMBER 2017 35


How TruKKer.ae is disrupting the goods transport

sector 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.

My latest interview is with Dubai based entrepreneur Guarav Biswas CEO of TruKKer. ae, a logistics technology start-up which commenced operations in the UAE in October 2016 and have already witnessed over 1600 per cent growth in nine months. Very impressive numbers indeed! So what’s it all about?

Here, Cartwright talks to TruKKer.ae CEO, Gaurav Biswas, about his company’s phenomenal growth and how he plans to maintain the pace.

TruKKer is basically a web and app based truck aggregator, or simply put; an UBER for trucks. It integrates the available trucks in the market and makes them visible in real time so that users can find and book a truck online immediately in a highly transparent way with instant quotes given and 100 per cent traceable trucks. The service is being used by logistics service providers who need additional trucks at short

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TRANSPORTATION

notice or on a temporary basis in line with increased demand and also by individuals for entire house moves or simply to move a large item from A to B. What would you say is a key reason behind your tremendous growth so early on?

I think a major contributor to our success has been the product features that users can really benefit from: ease of booking our services via the app or online, and the ability to track where their consignment is while in transit. We allow users who want to book a truck with us to complete the process in less than 3 minutes. They also have a lot of options as we aggregate everything from 1-ton pick-ups to 40-ft trailers. How do you think a truck aggregator like TruKKer is solving existing goods transportation problems?

In the road transport industry, there is uncertainty of truck availability as visibility is not transparent which creates price uncertainty and hence an absence of standard rates. There is also a huge counter-party risk plus the hassle of unorganised vendors. There are also counter-party risks of dealing with unknown parties when a customer and a transporter deal with each other for the first time with the absence of a past track record and service standards. Most small and medium-sized vendors have poor organisation skills and available documentation – including the ability to provide invoices or email transaction records. TruKKer is addressing a real industry problem. Finding a truck that is reliable and secure is an issue faced by both individuals and business drivers - and TruKKer solves that. Aside from having access to additional trucks at short notice how else could you see the logistics sector benefitting from using TruKKer?

A good example would be better utilisation of trucks in the country overall, which would not only save cost but would help reduce congestion and potentially reduce emissions. A specific example would be where many trucks from different companies are being

sent to deliver or remove items from a major construction site. Company A might be sending a truck there to offload and return empty. Company B might be sending an empty truck to the site to collect goods. If both companies had checked TruKKer.ae they might have seen a possibility to use the same truck and reduce cost and save time whilst also keeping another of their trucks free. How are transporters being affected by the disruption TruKKer brings into the goods transport sector?

operations. In the next nine to twelve months, we would also expand across the region. We are targeting an entry in Saudi Arabia, Kuwait, and Oman. By the end of this year, we should be in Saudi.

Brian Cartwright, Managing Director,

TruKKer is upgrading the individual truck operator/driver with advanced trainings in technology, customer interface and health and safety, which is improving their potential to offer better services and increase their efficiencies. The drivers are now benefitting from certainty of earnings and are focused on doing a good job of transportation instead of investing their time and energy into unorganised means of obtaining business.

Top Management

What are your goals for the next 12 months?

proactive business

The cross-border movements are next in line in our agenda. We have already started testing the service, including port movement

Resources Group (TMR), is wellknown throughout the international supply chain and logistics sector as a focused and highly

leader, mentor, and thought leader.

SEPTEMBER 2017 37


PORT REPORT

Robust growth at

Sohar Port

Mark Geilenkirchen, SOHAR Port and Freezone CEO, speaks about the innovations in the pipeline for the deep-sea port

S

OHAR Port and Freezone is growing across all sectors. With investments at SOHAR now topping US$ 26 billion, the deep-sea port will welcome over 3,000 vessels this year and will handle an average of over one million metric tons of sea cargo each week.“That is a phenomenal achievement for a port that only saw its first ship in 2004,”said Mark Geilenkirchen, SOHAR Port and Freezone CEO.“We have been growing at around 35 per cent year-onyear since.”

38 SEPTEMBER 2017

Work will start soon on SOHAR Port South, a significant land reclamation project that will create additional deep-water berths to the south of the existing port area. This reclaimed land will create sufficient space in the port to attract more businesses to guarantee the port additional, solid growth in the years ahead. Innovation is in the dna of SOHAR Port and Freezone, the mega-development has been pushing the boundaries of maritime logistics since it was first established and has found new ways of doing business, making


PORT REPORT

its tenants’ operations more efficient and convenient along the way. “Our new Hutchison-operated container Terminal C features remote-controlled quayside cranes, ready for next generation 20,000 TEU vessels; an automated appointment system to reduce truck waiting times and increase turnaround speed; and new Auto-Gates that cut paperwork and delays for drivers entering and leaving the new terminal facilities in SOHAR,”Geilenkirchen said. The port is able to leverage its position to enhance innovation in Oman and the

wider region and its new Innovation Zone is central to this effort. It wants to operate the Innovation Zone as an ideas factory. Working in close cooperation with the Port of Rotterdam, private sector companies, international research institutes and some of the world’s top universities, the Innovation Zone will be seeking solutions across a broad range of issues that affect its shipping, logistics and industrial hub at SOHAR. From innovative ways to track containers and their loads moving between the Port and Freezone; through the use of 3D metal printing to create high-quality industrial parts on site. SOHAR Innovation Zone will have a particular focus on sustainability and will operate as the world’s first self-sustaining free zone cluster. It will not be connected to the national power grid, instead of getting all its electricity needs from renewable sources, while all waste will be recycled. The Innovation Zone is not a hypothetical, futuristic concept, however. It will use proven and trustworthy techniques brought together in one integrated system for the first time, to demonstrate the full potential of Oman’s technology sector. Orpic’s new US$ 6 billion plastics project in the port is on track to open in the port by 2019. It will create 1.4 million tons of PE, PET and PP annually for a wide variety of uses, including food-grade packaging. This will put Oman on the world map as a major plastics producer and will attract many downstream industries to both the Port and Freezone. “There is a lot of interest in our new Food Zone, as today over three-quarters of the GCC’s food is imported,”said Geilenkirchen. “It’s a market that will continue to grow in the coming years, boosted by one of the world’s youngest and fastest growing

populations and the phenomenal growth in regional tourism, expected to top 83 million visitors a year by 2026.” Like all the Gulf countries that are highly reliant on imported food, the Oman government wants to create better infrastructure for food security and to increase its strategic reserves. The new Food Zone will include massive silos for grain and other agro-bulk commodities, such as vegetable oils. A 500-tonnes/day flour mill is now under construction and a sugar refinery project has also been signed up. SOHAR will import bulk food commodities for local consumption and for trading, but will also ship out finished food products to surrounding countries in line with rapidly increasing demand for ready meals and other convenience foods, as the region’s demographics change rapidly. SOHAR is ideally located as the prime food manufacturing, packaging and distribution hub for all of the regional markets surrounding Oman. “Our current throughput volumes have helped us enormously to shrink costs along the supply chain and stay competitive,” explained Geilenkirchen.“The opening of new logistical connections, such as our new cargo airport and the new direct highway to Saudi Arabia, will help to maintain and grow that advantage.” Over the next few years, SOHAR will become the core of a much larger and more significant integrated economic area with all kinds of activities. You will start to see areas with recreational activities, such as resort hotels and golf courses; more office buildings with supporting service industries; and more urban development with new schools and modern retail malls. As they say in SOHAR: It all starts here.

SEPTEMBER 2017 39


ADVERTORIAL

Rock solid operation Hashim Sharif Mudhir on how Al Akhilaa General Trading is preparing for Expo 2020

L

ike the infrastructure and roads it has helped to build, Al Akhilaa General Trading LLC has been a valuable link for construction contractors in the UAE stretching back to its founding as Al Ashraf General Transport three decades ago. Originally set-up to serve public works and government projects in Al Ain and Abu Dhabi, it has progressed to be one of the top 10 suppliers of aggregates and building material for projects across the emirates. With the country building towards hosting Expo 2020, CEO Hashim Sharif Mudhir says that the company, which owns a sizeable fleet dominated by trucks from MAN, is excited to be part of the preparation and estimates that business activity could increase by as much as 40 per cent during the run-in to the event. “We feel confident that our business will grow, especially considering Expo 2020 is coming up,” he says.“We are sure we will increase our fleet as we will need to start construction in this area.” Al Akhilaa General Trading’s success has been built on a strong recruitment policy, strict safety controls and a professional business approach to support which has helped it to forge a reputation for quality among its government and private clients (many of which operate in the time-sensitive and demanding ready mix sector). Mudhir recalls the early years of the company where Al Akhilaa played its part in the development of a series of projects in the capital and Al Ain, such as the building of the high-end Ajban Palace and the Al Raha Beach resorts; the supply of rock for the sculpting of the canal works in Al Wathba; as well as supporting the construction of low cost housing projects

40 SEPTEMBER 2017

in the more remote town of Sweihan. Mudhir outlines that Al Akhilaa General Trading – which was established in its own right in 1992 in Al Ain and is an ISO 9000-2008 Quality Management System Certified Company – has executed more than two billion dirhams (US$500 million) worth of projects up to now. He adds that the company currently owns and operates a fleet of 65 MAN trucks with a further 100 lease-able trucks available for contractors on a project basis. It also has a large fleet of 50 2- and 3-axle trailers. Together, he says, the trucks and trailers meet,“the requirements of customers to supply and deliver material to sites anywhere in UAE.” The well-maintained fleet is consistently reviewed and renewed where necessary annually, he adds. In a business where uptime is everything and delivery times from the crushers in quarries to the project area must be strictly adhered to, he says that the MAN fleet of trucks and the support - including utilising its United Motors & Heavy Equipment Co LLC (UMHE) workshops for full services - that comes with them is critical. “They provide peace of mind because we need to ensure that aggregates will be transferred on time from one location to another - and United Motors & Heavy Equipment Co LLC (UMHE) ensures timely delivery and high-quality of service,”he comments.“From a logistics point of view, MAN is a trustworthy partner so we don’t need to worry about anything.” Referring to servicing and maintenance, he

continues,“MAN makes it faster to service our trucks so they can go back to work sooner. They ensure efficiency, like ‘Formula 1’ efficiency.” “Our customers expect fast delivery, so that’s where the MAN trucks are helping us to provide the best possible service to our clients,”he says.“They help us to make our customers happy by getting things delivered on time and effectively make us more qualified for the job.” Al Akhilaa General Trading’s fleet operation is overseen by a team of 20 people that control fleet management and deployment across the country. Trucks are monitored by GPS software, Mudhir explains that the company always knows the location, speed and fuel consumption of its fleet. In an effort to provide support close to the Omani border (in Al Madam) far from Abu Dhabi and Dubai, it has set-up a workshop and garage with its own staff. The support crew of 25 are dedicated to the maintenance and management of trucks in the area. Additionally the company is looking to expand its presence in the emerging Western region of the country towards the Saudi Arabian border, he reveals.“The latest development under the banner of Al Akhilaa General Trading is Al Akhilaa General Transport which has an office based in Beda Zayed. This will enable the company to gain a greater grip on all the recent activities in the Western region of Abu Dhabi.” Mudhir says that the company has placed driving and safety training firmly at the centre of its operation. Conducted on annual basis, it has chosen to put drivers onto MAN’s ProfiDdrive programme. The programme consists of seminars and practical sessions lead by professionals to encourage safe and efficient vehicle utilisation. MAN ProfiDrive, however, ensures that our drivers are also well-trained with the principles of economical driving, the technical background information, as well as safety related topics,”he explains.“Logistics and quality is what we always provide and that’s why the customers always choose us.”


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MATERIALS HANDLING MIDDLE EAST

rowth

Unprecedented The GCC’s materials handling equipment market is expected to reach $5bn in revenues by 2020. It’s no wonder the region has attracted the world’s top 20 global suppliers to the Materials Handling Middle East 2017 event

W

ith over 130 exhibitors from as many as 21 different countries, representing 250 brands, having already signed up for the upcoming ninth edition of Materials Handling Middle East, the region continues to be a key focus of leading names in the intralogistics, warehousing, freight and cargo industries. Materials Handling Middle East is the only dedicated trade and networking event for the logistics, supply chain management and warehousing industries serving the wider Middle East. Additionally, despite the overall slowdown in economic growth trends worldwide, the

42 SEPTEMBER 2017


MATERIALS HANDLING MIDDLE EAST

SEPTEMBER 2017 43


MATERIALS HANDLING MIDDLE EAST

materials handling and logistics industries have continued to enjoy a relatively healthy growth rate in the region. According to research by analysts Frost & Sullivan, the market revenue for Materials Handling Equipment in the GCC, which was worth US$ 3.78 billion in 2014, is set to maintain a CAGR of over four per cent while reaching an estimated US$ 4.8-5 billion in revenues by 2020. Saudi Arabia, with about 46 per cent and the UAE with 35 per cent, make up the largest markets in the region and are expected to continue to spearhead market expansion going forward.

44 SEPTEMBER 2017

Ahmed Pauwels

Key drivers for the continued expansion in demand for materials handling equipment, continues to be the ongoing focus of the GCC countries in large-scale infrastructural and logistics development, including that of key transport and shipping hubs, export processing and free zones as well as the high dependence of many of these countries on imports of goods and services that calls for increased reliance on materials handling and logistics facilities. Realising the potent growth potential of the regional market, the Top 20 of the world’s leading materials handling


MATERIALS HANDLING MIDDLE EAST

How virtual reality 3D animation as educational tool for latest warehouse technologies will help materials handling suppliers

systems suppliers have already signed up for Materials Handling Middle East 2017, which will run from September 11 to 13, at the Dubai International Convention and Exhibition Centre. “As the only dedicated trade and business development event for the materials handling, logistics, warehousing and freight handling industries, Materials Handling Middle East has through the years served as an invaluable networking and interactive platform for industry stakeholders, suppliers, traders and buyers to conduct business and scope out the latest developments in

Intralogistics managers at this month’s Materials Handling Middle East exhibition in Dubai will learn how they can optimise the flow of goods in an automated warehouse using virtual reality 3D technology. Armed with HTC Vive Goggles, supply chain heads will experience how different technologies in fully automated warehouses such as robotics and Industry 4.0 can work together. The Virtual Reality 3D warehouse animation will be showcased by Swisslog, one of the world’s leading suppliers of robot-based and data-driven intralogistics solutions. Daniel Hauser, Managing Director for Central Europe and the Middle East at Swisslog Warehouse & Distribution Solutions, said that while visitors can explore an automated warehouse in a fun way, they can also experience first-hand its unique benefits. “Virtual Reality 3D warehouse animation will become a real service for customers in the future, and there are different ideas within Swisslog on how it can be deployed in the intralogistics world,” said Hauser. “It can be used in sales to show buyers what their future systems would look like up and running on

site, and it can be used to simulate systems to determine the optimal material flow or to observe performance during projected peak times. “Another vision is to provide access and track live operations of any facility in the world, as well as play back historical data for error analyses.” The Virtual Reality 3D warehouse animation is one of several Swisslog innovations at Materials Handling Middle East 2017. Swisslog will also introduce its new AutoPiQ solution, a robot based automated picking solution for small items, ideal for e-commerce, pharmaceutical or spare parts logistics. Meanwhile, Materials Handling Middle East 2017 will feature other leading warehousing automation specialists such as GreyOrange SSI Schaefer, and Daifuku, the world’s largest materials handling systems supplier.

Andrey Kras, Account Manager at Daifuku’s International Business Department, said the company also plans to use virtual reality at its booth so customers can visualise automated systems of their choice. “The hotness of the automation topic in previous years was measured by the level of surprise and discoveries made by Middle East managers as to how automated equipment can benefit their businesses,” said Kras. “Now is the time to make business decisions and start buying new automated systems. “Daifuku’s name is still unknown to many in the industry in this region, so raising brand awareness is one of our main goals at Materials Handling Middle East 2017. We plan to continue using our booth as an education platform with multiple teaching aids to get ideas of automation across.”

SEPTEMBER 2017 45


the industry,”said Ahmed Pauwels, CEO of organisers Messe Frankfurt Middle East.“This year we not only have participation from the top global brands and service providers but also a considerable increase in interest from trade buyers from across with wider region.” Among the global heavy hitters who will be showcasing their latest offerings on the regional stage at Materials Handling Middle East 2017, including the likes of Swisslog, Daifuku and Kardex. Local leading lights such as General Navigation and Commerce Company (GENAVCO), SPAN Motors and United Motors and Heavy Equipment will also be out in force, while debutants such as Feralco from France, MPM from Italy and Saudi manufacturer, Power Rack Factory will look to make more than just an initial favourable impact. Touting the vital role of automation and the merging of digital and intelligent processes and systems as the road to the future of materials handling, Frederic Zielinski, General Manager of Swisslog Middle East, sees immense potential in the Middle East. “The changing customer demands require forward-thinking innovative and flexible solutions from businesses. By implementing fully integrated, effective, future-proof automation solutions and keeping their facilities up-to-date with modern companies

46 SEPTEMBER 2017

can not only speed up their processes and satisfy changing customers’ needs but also stay profitable by adding greater productivity into their supply chain and reducing the amount of errors. “Industry 4.0 has the potential to reshuffle the cards in how businesses operate. With networked intelligence in manufacturing and self-organising production processes, the ‘factory of the future’ will perform a quantum leap in productivity, flexibility, and efficiency. The focus in the future will no longer be on the manufacturing process of purely massproduced goods, but on the customized product manufactured. This evolutionary step can only succeed, however, if we finally break down the barriers between the digital and real worlds,” Zielinski stated. GENAVCO, one of the UAE’s leading suppliers of warehouse storage and material handling solutions, is another exhibitor launching its end-to-end warehouse solution engineering capabilities during Materials Handling Middle East 2017. Neeraj Mahajan, the Director of GENAVCO, said material handling equipment represents an integral part of the supply chain of diverse industries for storage, control and movement of items - from the raw material stage to the distribution of finished products.

“The rising need for global production companies to automate operations and foster flow of goods in an efficient manner is the key force driving growth in the materials handling equipment market,”said Mahajan. “The main challenge for customers in this region is to get a complete solution from a single source. They have to approach two or three companies for a complete warehouse solution. This process itself is time-consuming and most of the time they are facing great difficulty to get an optimised solution meeting their needs. “Here we play a vital role with our Warehouse Solution Engineering to overcome this challenge by offering end-to-end solutions. We design and develop custom made concepts as per customer requirements, so projects are delivered from one source and in the timeliest manner,”Mahajan stated. Materials Handling Middle East 2017, will also feature the Supply Chain and Logistics Forum, a key interactive forum to discuss and examine the strategies, policies, trends that are of relevance to the industry today, as well as shining the light on new and existing opportunities in the field. The event will additionally showcase the Forklift Operator of the Year Challenge, a competition to decide the most talented and skilful forklift jockeys in the region.


Logistics Excellence to Support Vision 2021 www.sclarabia.com Supply Chain Technology | Logistics | Warehousing | E-Commerce

SUPPLY CHAIN

& LOGISTICS Arabia An Infinity Expo Initiative

01-02 Nov 2017

The Address Hotel, Dubai Mall, UAE

Kurt Warren The Chairman of the Fellow Committee-MENA, CIPS

Logistics Excellence Support 2021 Michael Stockdale Sanjay Sharma to Samer Madhoun Vision Gregory Gottlieb CEO-B2C Logistics CEO-Roambee PartnerDirectorSupply Chain Technology | LogisticsManaging | Warehousing | Managing E-Commerce Muhakat Institute

Airships Arabia DWC-LLC

Kurt Warren

Michael Stockdale

Sanjay Sharma

Samer Madhoun

Gregory Gottlieb

The Chairman of the Fellow Committee-MENA, CIPS

CEO-B2C Logistics

CEO-Roambee

Managing PartnerMuhakat Institute

Managing DirectorAirships Arabia DWC-LLC

Marcel Meyer

Adel Al Falasi

Marcus Meissner

Brian Barriskill

Kareem Naouri

Managing DirectorWeiss-Rohlig, LLC

Advisor Prime Minister of UAE

Managing Partner, Camelot Management Consultants Middle East

General Manager CarrďŹ elds Forage & Grain

CEO-Logistaas

Marcel Meyer

Adel Al Falasi

Marcus Meissner

Brian Barriskill

Kareem Naouri

Managing DirectorWeiss-Rohlig, LLC

Advisor Prime Minister of UAE

Managing Partner, Camelot Management Consultants Middle East

General Manager CarrďŹ elds Forage & Grain

CEO-Logistaas

Jaideep Singh

Dr. Makrem Kadachi

Arif Siddiqui

Gopal R

Sharad Nigam

President The CXO-Alliance

General ManagerEhrhardt + Partner Solutions

DirectorCoign Consulting

Global Vice President Transportation & Logistics

Principal & Global LeadInnovation Accenture Consulting

Jaideep Singh

Dr. Makrem Kadachi

Arif Siddiqui

Gopal R

Sharad Nigam

President The CXO-Alliance

General ManagerEhrhardt + Partner Solutions

DirectorCoign Consulting

Global Vice President Transportation & Logistics

Principal & Global LeadInnovation Accenture Consulting

Organized by: Supported by: Organized by:

Supported by: For Registration Contact:

Rahul Rawat | +91 9599389543 | rahul@infinityexpo.in Manan Tyagi | +91 9968461646 | manan@infinityexpo.in

For Registration Contact:

Rahul Rawat | +91 9599389543 | rahul@infinityexpo.in Manan Tyagi | +91 9968461646 | manan@infinityexpo.in


TECHNOLOGY IN MANUFACTURING

Need for

speed As emerging technologies like 3-D printing begin to bring personalised manufacturing to scale, ManMohan S. Sodhi and Christopher S. Tang explain how a new “high-speed bespoke” supply chain model is following suit

T

he newest wave of digital customer engagement is developing in one of the oldest industries: manufacturing. Thanks to emerging technologies like 3-D printing, manufacturers can offer consumers customised products and do so with unprecedented speed. Intrigued by a new product you saw in a YouTube video? Well, soon you may be able to personalise it, order it via the company’s website, and have it in your hands in a matter of days. We are seeing this phenomenon emerge in a variety of consumer product sectors, including personalised running shoes pioneered by the likes of Adidas AG and Nike Inc. The age of mass customisation is finally here, backed by a new kind of supply chain. Across product categories, we find companies engaging with customers online and inviting them to customise and order products from a company website. Orders are produced quickly – in factories that are located close to the customer and that use 3-D printing and

48 SEPTEMBER 2017


TECHNOLOGY IN MANUFACTURING

SEPTEMBER 2017 49


TECHNOLOGY IN MANUFACTURING

robotics – and delivered via the highestspeed options available. We call these new supply chains high-speed bespoke supply chains, because they provide both quickness and product customisation. And while the emergence of this new model is a function of the manufacturing of personalised products, its value extends to other uses, such as the manufacturing and fulfilment of rarely ordered products. High-speed bespoke supply chains also offer the promise of unprecedented market intelligence for manufacturers by capturing demand signals directly from online customers about specific features they are seeking in existing products and prototypes. These manifold opportunities also bring new

50 SEPTEMBER 2017

challenges for manufacturers, who will need to strategically integrate a wholly new supply chain model into their operations.

A new supply chain option Having the right type of base supply chain – one that is lean for cost efficiency or agile for time efficiency – is well-understood by manufacturers. It is a choice that depends on whether the products are commodities – functional goods for which cost matters most – or fashion goods − innovative products for which time to market is critical. Many leading companies split their supply chains between the two types of products. Spanish clothing retailer Zara, for instance, makes its fashion goods in Europe, to be shipped quickly via

truck to European customers, while sourcing its commodity goods from China or India and shipping them by sea. High-speed bespoke supply chains add a third option to this framework. Whether a company employs a lean supply chain or an agile supply chain or a combination of both, its operations are usually meant to be optimised for make-to-stock products based on forecasts. By contrast, high-speed bespoke supply chains fit the needs of make-to-order products based on realised demand, not forecasts. There’s another advantage to extending the lean-agile framework with a highspeed bespoke supply chain: Supply chain managers gain a potentially more cost-


effective option for fulfilling ultra-lowvolume items, such as replacement parts for outdated product models. Instead of relying on lean or agile supply chains to fulfil orders for products with low, sporadic demand from a slow-turning inventory of finished or semifinished goods, companies could fulfil such orders by high-speed bespoke supply chains. German automaker Daimler AG, for instance, is experimenting with 3-D printed plastic spare parts for Mercedes-Benz trucks, no matter how old the model. By moving these replacement parts to on-demand production, the company not only decreases inventory but is also able to retire a large number of molds and related equipment. Without this overhead, an order can be

“High-speed bespoke supply chains offer the promise of unprecedented market intelligence for manufacturers by capturing demand signals directly from online customers about specific features they are seeking in existing products and prototypes.�

SEPTEMBER 2017 51


fulfilled from the nearest of the company’s manufacturing or development locations worldwide using 3-D printing. Developing a high-speed bespoke supply chain also allows marketers to add more product variety with niche demand, fattening the so-called “long tail”of product demand to reap additional profits from niche products. Although unit manufacturing costs in a high-speed bespoke supply chain are higher than in the base (lean or agile) supply chain, the total supply chain’s cost per unit can be lower for products with low levels of sporadic demand, because inventory and transportation-related costs are greatly reduced. And for customised products, customers have shown their willingness to pay more – sometimes much more – for products they’ve shaped themselves. Finally, the high-speed bespoke supply chain is premised on manufacturing facilities close to customers for quick delivery. Thus, high-speed bespoke supply chains translate into in-country manufacturing jobs, which are being sought by governments in many countries, including the United States. The bulk of manufacturing, however, would remain in low-cost offshore locations, because customised products will remain a small but valuable portion of overall unit sales.

52 SEPTEMBER 2017

The model in action

Instead of relying on lean or agile supply chains to fulfil orders for products with low, sporadic demand from a slow-turning inventory of finished or semi-finished goods, companies could fulfil such orders by highspeed bespoke supply chains.

Some leading global manufacturers have already begun experimenting with highspeed bespoke supply chains. Sports apparel company Adidas, which offers customisation of its shoes through its Mi Adidas (“my Adidas”) online platform, has built its first“Speedfactory”in Germany to add high-speed manufacturing to its bespoke product offering. The company plans to open additional Speedfactories in Western countries, including one in Atlanta, Georgia, in 2017. While Adidas will continue to make the vast majority of its shoes via the Asian contractors in its base supply chain, it wants the Speedfactories to be able to produce an estimated 1 million custom-designed pairs of shoes annually to meet high-priced demand for customised products in Western countries. With these Speedfactories, Adidas plans to dramatically slash the time between custom orders and delivery to four to five business days. A customer could design and order his or her dream shoe on Monday and receive the pair on Friday. The company can monitor its customers’ creations on the web. If particular designs or features recur at high enough rates, Adidas can incorporate them into standard shoes in the base supply chain. Personalised orders thus offer insight into customers’ desires.


TECHNOLOGY IN MANUFACTURING

Nike also offers customisation with its NikeiD program; customised shoes can be ordered via its website. According to Nike chief operating officer Eric Sprunk, the eventual plan is for customers to be able to walk into a Nike store and have a 3-D-printed shoe made within a matter of hours. In the toy industry, Mattel Inc. is tapping into the maker movement and bringing on-demand manufacturing directly into customers’ homes (essentially giving people their own at-home, high-speed bespoke supply chain) via a microwave-sized 3-D printer and computer app for children called ThingMaker. Set for release in fall 2017, the package’s app will let a child customise toys such as dinosaurs, robots, and dolls and then send the resulting stereolithography file to the 3-D printer. The parts will be printed with ball-and-socket joints to be assembled by the child. Although Mattel’s idea is for customers to create their own stereolithography files, nothing stops Mattel from offering retired models and “trial balloons”as stereolithography files for 3-D printing at home. Analysing orders for these files would help the company spot new market trends and bet on potential winners

more confidently when deciding what to manufacture for store sales, say, in the Christmas period. Likewise, Mattel could retire some existing cash cow products earlier based on trends it observes on falling orders for stereolithography files. Of course, retirement of a product now would mean only that the product is moved to the bespoke supply chain, potentially available forever for 3-D printing at home.

Barriers to adoption Certainly, there are barriers to a company setting up a high-speed bespoke supply chain to complement its existing base supply chain. First, companies should be sure they understand whether and how they stand to benefit from a high-speed bespoke strategy – to enable customised manufacturing to produce ultra-low-demand parts or to simply sense changes in customer demand patterns much earlier than is possible now. Next is the issue of additional investment. The direct cost of outfitting asset-light 3-D printing facilities is low compared with the capital costs for traditional factories. But significant learning costs can arise related to adopting new technologies and a new supply chain model. Another barrier is operational: 3-D printers – supplemented with other

highly flexible and automated manufacturing equipment such as robots – must be able to actually make the company’s products, or at least some components that lend themselves to quick and easy assembly. At present, Daimler is offering 3-D printed plastic spare parts but not, say, replacement gearboxes or engines. This obstacle will lessen over time as 3-D printing capabilities improve. And then there is distribution. Most manufacturers are accustomed to delivering in bulk at low cost across long distances, with speed often a secondary concern. High-speed bespoke supply chains flip this model on its head. They are short in distance, light in volume, and offer quick delivery. The last mile of a high-speed bespoke supply chain resembles Amazon Prime more than any traditional manufacturing or wholesale delivery system. The solution for most companies building high-speed bespoke supply chains is not to develop distribution on their own. Instead they could either piggyback onto the efficient in-country infrastructure already built by e-commerce leaders like Amazon, Alibaba, and, increasingly, Google, or outsource to in-country local delivery services. Other options may emerge: For example, Amazon plans to launch an Uber-like app that would, among other things, connect individual truck drivers to shippers that need goods moved. While the financial and operational barriers to launching a high-speed bespoke supply chain are not trivial, they are modest in comparison to what it took companies to build their legacy manufacturing and distribution networks. Companies would be wise to ride this newest wave of digital customer engagement. They should consider not only how adding a high-speed bespoke supply chain could improve their existing business but also what new businesses and business models such a supply chain would enable. ManMohan S. Sodhi is a professor of operations and supply chain management at Cass Business School at City University of London. Christopher S. Tang is a UCLA Distinguished Professor and the Edward W. Carter Chair in Business Administration at the UCLA Anderson School of Management in Los Angeles, California.

SEPTEMBER 2017 53


ENVIRONMENT

The hope for a more sustainable

service Arne Berndt, owner/adviser at SoundPLAN, a world-leading mapping software manufacturer, explains the benefits of using softwareproduced maps to help mitigate emissions

54 SEPTEMBER 2017


ENVIRONMENT

G

lobally, traffic is now the largest single contributor to air pollution around the world. Although modern fleets are environmentally friendlier than their predecessors, the sheer volume of traffic means that pollution from vehicles has increased dramatically and is a significant health risk. The World Health Organization (WHO) reports that air pollution is the world’s largest single environmental health risk. It says that in 2012 one in eight of total global deaths (around 7 million people) was the result of air pollution exposure. Reducing air pollution and people’s exposure to it could therefore save millions of lives and transport is key to the solution. Alongside the risk of fatalities, air pollution is also a contributory factor in respiratory diseases, including acute respiratory infections and chronic obstructive pulmonary diseases. There is also a lesser known, but strong correlation between exposure to air pollution and cardiovascular diseases, such as strokes, ischaemic heart disease and cancer. Exposure to air pollution can also cause temporary ailments, such as headaches and skin rashes.

Essential service The supply chain and logistics industries provide an essential service ensuring a viable global economy, but they must continue to address sustainability issues if they are not to have a detrimental impact on health.

SEPTEMBER 2017 55


ENVIRONMENT

directions and scenarios. An added variant is that the air pollutants are often reactive gases which change over time under the presence of UV light. For transport companies, understanding the effects and dispersal of air pollution can mean it is possible to introduce effective mitigation methods – such as barriers, speed limits and dust abatement techniques – at depots or transport hubs, or to alter routes so that emission levels are not all concentrated in one area – especially at peak times. Modelling can also show the impact of updating vehicles and replacing them with less polluting versions.

Lift and shift

The most significant improvements will be made through new technology, such as the increased use of electric and hybrid vehicles, and legislation – both France and the UK have announced plans for a ban on petrol and diesel vehicles by 2040 for instance. However, software mapping can also help by identifying both the sources and dispersal of air pollution. This makes it clearer where mitigation measures are required and allows different solutions to be tested ahead of implementation.

Companies want their logistics suppliers to match their own sustainability goals. Using mapping software to mitigate emission levels can sit well with this new approach as software mapping is a datadriven operation. Air pollution is usually measured at monitoring stations in several locations, but wide-scale accurate measurements are difficult to achieve due to terrain and weather factors which mean that levels can vary greatly even in small areas.

Embracing innovation

Models not measurements

The world of the commercial transport company is changing rapidly. Just providing a cheap and reliable service to transport goods from A to B is no longer enough. Logistics businesses are increasingly using technical solutions – including automated fleet management systems, cloud-based data analytics, robotics, location detection and autonomous vehicle technologies – to get a step ahead of the competition and build relationships with customers. A growing understanding and implementation of sustainability practices will often be an important part of these relationships.

Rather than taking measurements, it is more effective to model air pollution dispersal using software mapping. The options available include ‘simple’ Gauss models and more complex prognostic models. The model selection depends strongly on the task and the available data. Air pollution models are highly dependent on the meteorological situation for the dispersal calculation, requiring multiple weather scenarios. In order to correctly assess the pollution load for various situations, it is paramount to simulate the dispersal of the pollutants for a wide variety of wind

56 SEPTEMBER 2017

Mapping software is particularly relevant when planning new facilities. Using the software facilities can be virtually ‘lifted and shifted’ anywhere in the world and then local details, such as haulage routes, can be added. This makes the software an integral part of quality project management for a large number of industrial ventures. Many large global technology, engineering, procurement and construction companies use noise mapping software as a key component in every stage of a project from conception to post-commissioning sign-off. When you choose the right noise mapping software you have a powerful and flexible software tool at your disposal. For instance, some versions allow users to import digital terrain models and overlay Google Maps on to their plans. They even allow manipulation of the surroundings, meaning mountains and other geographical features can be removed or altered to get a better view of the way emissions travel. Software should have a graphical output, as this means that people without an in-depth knowledge of acoustics or engineering can understand the effects of noise. For instance, maps are often colour coded and some can be software can produce 3D models too.

Widening the map Maps are an essential part of any supply or logistics business. By expanding their use to include air pollution mapping, companies can ensure they are reducing their impact on the environment while still delivering their business objectives. http://www.soundplan.com/noise-control.htm


Subscribe today Global Supply Chain is a magazine that aims to provide quality editorial content aimed at providing the supply chain industry with information that assists in meeting and overcoming challenges and making the most of supply chain opportunities. Global Supply Chain will be the publication of choice covering all aspects of the industry from transport (air, sea, road, rail), technology, warehousing, materials handling, reverse logistics, sustainability and more. This media pack has the in-depth editorial plan for 2014 as well as rates and specifications. We look forward to establishing a successful, long term relationship with you.

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Ports Abu Dhabi

DRIVING CHANGE

UAE’s key resource

Sharjah

Aviation and shipping

Ecommerce

UD Trucks

Needs the right distribution partner

Hiring and salaries 2017

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Green tech

Lift truck operators

Driving to success

How is it looking?

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An app for your fleet? Not one but two apps

KSA’s healthcare

Bee’ah and Masdar sign JV

Medical cities, insurance and more

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Materials handling 2017 The US$5 billion industry by 2020

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TRANSPORT

Full throttle S

Munawar Shariff talks to Janardan Dalmia, Co-Founder and Chief Executive of Dubai-based start-up Trukkin, about the platform’s incredible rise and future plans for the region 58 SEPTEMBER 2017

ince its launch in July this year, Trukkin Middle East – a cloudbased B2B platform that unites customers, shippers and truckers in the Middle East region to streamline logistics solutions – has been making waves in the region. Some would say it is here to transform the logistics industry. Janardan Dalmia, co-founder and chief executive of the Dubai-based start-up talks about the venture’s growth and his plan to take over the GCC region. In the GCC, Trukkin operates out of the United Arab Emirates and the Kingdom of Saudi Arabia. According to Dalmia, the group has plans in place to scale further in these markets and later open offices in the rest of the region. Those plans will come to fruition soon enough. Despite the rest of the world jumping onto the digital bandwagon, commercial surface transport has been one of the few

industries where services continue to be offered in an old-school and traditional manner. This archaic functionality of such a vital business industry is what drove Dalmia into finding a solution.“We spent a significant amount of time on-the-ground in UAE and KSA meeting large and small enterprises, transporters and independent truckers to understand their current operations and the inefficiencies that exist,”said Dalmia.“Our research over many months revalidated the need in the market and that’s how Trukkin was born. “The market is very fragmented across the region which has led to several inefficiencies in this space,”he added.“With the help of technology, strong operations and professional customer experience, Trukkin is working towards streamlining that.” Dalmia’s choice to start with the UAE and Saudi Arabia wasn’t simply an impulsive one. His team estimated the surface transport


TRANSPORT

market in the GCC to be worth approximately eight or nine billion US dollars. Saudi Arabia and the UAE represent about 60 per cent of that market. With figures like those, it would be foolish not to use Dubai and Riyadh as operational headquarters. The app is said to answer a genuine industry need for greater transparency, choice of providers and the ability to request transport services from available fleets.“Customers, fleet owners and independent drivers must all go through a verification process to register with Trukkin, and during the use of the service transparency is maintained,”explains Dalmia. “We allow customers to benefit from the most competitive prices and at the same time open up new avenues for transporters. We help reduce their empty backhauls and create several efficiencies through the entire process providing full operational support to both; the shippers and transporters.”

Of course, it’s human nature for users to expect some value-added benefits for their business. Everyone’s always looking for ways to make their lives easier.“As soon as they understand the value proposition of our product and service, they are always more than interested to use our services,” says Dalmia.“I do not view shippers or transporters as our customers. I see them as partners. We engage with them at a deeper level to understand their requirements so we can continually work towards enhancing their experience.” With every business comes the matter of competition and market share within that industry. And for newer businesses, establishing a foothold is that much harder. Trukkin wasn’t exempt from that law of the jungle, but the company is focused on creating a great service oriented company for the region.“We are starting to see the results

both in UAE and KSA,”says Dalmia.“We like to focus on our own business and we are fortunate to have strong local businessmen who are our partners and mentors.” The requirement for land transport will always be there and with companies looking to become more competitive and efficient in the market they operate in, Trukkin seems far better placed than most of its competitors. Dalmia concurs with this assessment adding, “I believe with the growth of UAE and a strong focus on the Saudi 2030 vision, Trukkin has a very bright future ahead and we look to be the number one logistics enabler in GCC.” The road to becoming number one won’t be east – it seldom is. For the moment, Trukkin is committed to making significant investments in technology to optimize commercial transport and making it more efficient and transparent. That’s a good a start as any.

SEPTEMBER 2017 59


TECHNOLOGY

The future of the warehouse Most manufacturers to adopt wearable technology by 2022

I

IoT has crossed the chasm, and savvy manufacturers are investing aggressively in technologies that will create a smarter, more connected plant floor to achieve greater operational visibility and enhance quality. Globalisation and intensifying competition are contributing to the need for manufacturers to invest in a connected plant floor. A new study shows that the number of organisations achieving a fully connected

Key findings include: Manufacturers will continue to adopt Industry 4.0 and the smart factory. Workers will use a combination of radio frequency identification (RFID), wearables, automated systems and other emerging technologies to monitor the physical processes of the plant and enable companies to make decentralized decisions. By 2022, 64 per cent of manufacturers expect to be fully connected compared to just 43 per cent today.

factory is expected to rise dramatically over the next five years. The study, Zebra’s 2017 Manufacturing Vision Study, conducted by Zebra Technologies Corp, a provider of mobile computers, scanners, and barcode revealed manufacturers are adopting the IIoT to enhance visibility and improve quality. “Manufacturers are entering a new era in which producing high-quality products

One-half of manufacturers plan to adopt wearable technologies by 2022. And 55 per cent of current wearable users expect to expand their level of usage in the next five years. Manual processes are expected to dramatically decline. Today, 62 per cent use pen and paper to track vital manufacturing steps; this is expected to drop to one in five by 2022. The use of pen and paper to track work in progress (WIP) is highly inefficient and susceptible to error.

is paramount to retaining and acquiring customers as well as capturing significant cost savings that impact the bottom line,” said Jeff Schmitz, Chief Marketing Officer, Zebra.“ The results of the study prove that IIoT has crossed the chasm, and savvy manufacturers are investing aggressively in technologies that will create a smarter, more connected plant floor to achieve greater operational visibility and enhance quality.”

Executives across all regions cited achieving quality assurance as their top priority over the next five years. Forward-looking manufacturers are embracing a quality-minded philosophy to drive growth, throughput and profitability. By 2022, only 34 per cent expect to rate this as a top concern – signaling that improvements made by both suppliers and manufacturers will ultimately improve the quality of finished goods. Manufacturers stated investments in visibility will

support growth across their operation. Sixty-three percent cited tracking as a core focus with a blend of technology (i.e. barcode scanning, RFID and real-time location systems [RTLS]) expected to be deployed to achieve the desired visibility. Fifty-one percent of companies are planning to expand the use of voice technology in the next five years. The most dramatic growth for voice technology will be in the largest companies (>$1 Billion) with a reported use growing to 55 per cent by 2022. Source: www.mhlnews.com

60 SEPTEMBER 2017


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Global Supply Chain September 2017 Issue  

Supply Chain, Supply chain management , logistics and supply chain segmentation, warehousing, RFID, healthcare logistics, 3PL, 4PL, six sigm...