SupplyChain Magazine – August 2023

August 2023 | supplychaindigital.com

SUPPLY CHAIN

BUSINESSES

THE FUTURE OF 3PL + 4PL

IN A POST-PANDEMIC WORLD More firms than ever are collaborating with outsourced logistics providers to minimise supply chain disruption

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The SupplyChain Team EDITOR-IN-CHIEF

SEAN ASHCROFT CHIEF CONTENT OFFICER

SCOTT BIRCH

MANAGING EDITOR

NEIL PERRY

CHIEF DESIGN OFFICER

MATT JOHNSON

HEAD OF DESIGN/ SUPPLYCHAIN LEAD DESIGNER

ANDY WOOLLACOTT

FEATURE DESIGNERS

MIMI GUNN SOPHIE-ANN PINNELL HECTOR PENROSE SAM HUBBARD REBEKAH BIRLESON JULIA WAINWRIGHT ADVERT DESIGNERS

JORDAN WOOD DANILO CARDOSO CALLUM HOOD VIDEO PRODUCTION MANAGER

KIERAN WAITE

SENIOR VIDEOGRAPHER

MARKETING MANAGER

DIGITAL VIDEO PRODUCERS

PROJECT DIRECTORS

HUDSON MELDRUM ERNEST DE NEVE THOMAS EASTERFORD DREW HARDMAN SALLY MOUSTAFA PRODUCTION DIRECTORS

GEORGIA ALLEN DANIELA KIANICKOVÁ PRODUCTION MANAGERS

JANE ARNETA MARIA GONZALEZ YEVHENIIA SUBBOTINA

KATHRYN WEBB STUART IRVING JAMES BERRY

MEDIA SALES DIRECTOR

JAMES WHITE

MANAGING DIRECTOR

LEWIS VAUGHAN CEO

GLEN WHITE

FOREWORD

SUPPLIER COLLABORATION GIVES FIRMS A COMPETITIVE EDGE AS AUTOMATION LIBERATES PEOPLE FROM TRANSACTIONAL SUPPLY CHAIN ROLES, FIRMS ARE NOW TARGETING STRATEGIC SUPPLIER COLLABORATION

“The point of supplier programmes is collaboration” ELVIRE REGNIER LUSSIER,

CPO CONSULTANT & COACH

McKinsey research shows that organisations that regularly innovate in partnership with suppliers are more likely to see the biggest earnings growth sometimes up to 10% more.

In this issue, we explore how organisations are seeking to make procurement and supply chain more strategic in nature as they seek competitive advantage in a tough market. Tapping into supplier innovation is pivotal to this.

We learn how digitalisation is changing the profile of procurement teams, for example. In the past transactional areas procurement – such as contracts – were people-heavy, but automation is freeing-up people’s time in these areas, giving scope for people to be strategic, and collaborative.

“The point of supplier programmes is collaboration,” CPO consultant and coach Elvire Regnier Lussier tells us. “You need strategic buyers and an entrepreneur mindset.”

Read on, for these and many other insights across logistics and procurement, as well as supply chain sustainability and tech.

SEAN ASHCROFT

sean.ashcroft@bizclikmedia.com SUPPLYCHAIN DIGITAL MAGAZINE IS PUBLISHED BY

© 2023 | ALL RIGHTS RESERVED

supplychaindigital.com

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CONTENTS UP FRONT 014 BIG PICTURE

014

Global crowds flock to shell out for lobster

016 LIFETIME OF ACHIEVEMENT

Sven Markert, CSCO of Smart Infrastructure at Siemens,

020 INTERVIEW WITH Áine Fanning, Managing Director of the Cpl Talent Evolution Group

016

088

CHAIN

020

SUPPLYCHAIN BUSINESSES

AUGUST 2023

056 FEATURES

026

026 RHI MAGNESITA

How refractories specialist RHI Magnesita transformed its supply chain and mindset

046 SUPPLY CHAIN

Supplier innovation shaping the future of procurement

056 LOGISTICS

Outsourced logistics in a post-pandemic world

046 072 supplychaindigital.com

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The World’s Fastest Growing Procurement & Supply Chain Event 26 - 27 September 2023 Business Design Centre, London

GET YOUR PASS

SPONSORSHIPS

A BizClik Event

AUGUST 2023

066

066 SUSTAINABILITY Renewable energy supply chains under pressure

078 TECHNOLOGY

Rich data is shaping supply chain stories

088 TOP 10

Supply chain businesses

078 supplychaindigital.com

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Events Programme

6 - 7 Sept 2023

26 - 27 Sept 2023

11 - 12 Oct 2023

Business Design Centre London

Business Design Centre London

Online

CONFERENCE & EXHIBITION

CONFERENCE & EXHIBITION

VIRTUAL EVENT

GET INVOLVED

GET INVOLVED

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Adam Elman Head of Sustainability EMEA Google

Musidora Jorgensen Chief Sustainability Officer Microsoft

Nick Jenkinson Managing Director Verto Solutions Ltd

Susan Spence VP, Sourcing Procurement & Accounts FedEx

VP

2023 8 - 9 Nov 2023

18 - 19 Nov 2023

6 - 7 Dec 2023

QEII Centre London

Online

Online

CONFERENCE & EXHIBITION

VIRTUAL EVENT

VIRTUAL EVENT

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GET INVOLVED

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Geraint John P, Interos Resilience Lab Interos

Kate Rosenshine Director - Global Azure Technology Sales Microsoft

Aravind Narayan Global Director - Sales Strategy & Execution Refinitiv (LSEG)

Sam Clarke Chief Vehicle Officer Gridserve

BIG PICTURE

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August 2023

Global crowds flock to shell out for lobster Maine, USA In the Northern Hemisphere, August is a prime month for food production – both from land and sea – and there’s no shortage of festivals to mark this abundance.

One is the Maine Lobster Festival, on the furthest reaches of the north-east coast in the US. American lobster – also known as Maine lobster – is the heaviest crustacean in the world, which Maine’s citizens, and thousands of tourists from across the globe, celebrate every year.

Maine’s lobster supply chain extends from trap to table, with the state handling catching, processing and distributing an estimated 3.2 million kilograms of lobster every year. supplychaindigital.com

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Siemens’ healthy supply chain is Markert’s value Sven Markert, CSCO of Smart Infrastructure at Siemens, has seen a great deal in his long career, yet has never stopped learning Sven Markert has served Siemens with distinction for almost a quarter of a century. Siemens is a German multinational conglomerate and is the largest industrial manufacturing company in Europe.

The company specialises in intelligent infrastructure for buildings and decentralised energy systems, on automation and digitalisation in the process and manufacturing industries, and on smart mobility solutions for rail and road transport.

Markert’s first role with the company was as a consultant, when he was a lead on various projects for internal Siemens divisions.

He worked his way up to Senior VP Supply Chain Logistics, a position he held for a decade. Based in Switzerland and Germany, he was responsible for supply chain

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August 2023

– planning, sourcing, delivering, returning and enabling processes – in the Solution, Service & Product areas of the business.

He was direct lead for more than 1,500 employees in Switzerland, Germany and Asia, and had responsibility for a budget of €400mn (US$440m).

Various success stories building resilient supply chains In his current role, he is responsible for the supply chain management of logistics, heading up more than 4,000 employees across multiple business units. He also manages and develops shared-service operations for customer services and logistics, as well as overseeing the digitalisation of SCM, including benchmark oriented processes.

LIFETIME OF ACHIEVEMENT

“All stakeholders and business units in supply chain and logistics are subject to continuous change” supplychaindigital.com

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SVEN MARKERT HAS BEEN WITH SIEMENS FOR

22 years and ten months

“My belief is that the supply chain of the future must not only be robust but must also focus on the environment and the customer,” says Markert. “This requires smart, digitally supported decisions, especially in our dynamic world.

He adds: “The digital transformation helps us to do more with less, being more sustainable in our actions.

This drives and motivates me.

“I aim for learning, and strive to improve every day, to have a positive impact – on customers, stakeholders, people, our environment and myself.”

Markert says he is “deeply rooted” in supply chain management, operations and finance, and declares his “passion for leadership”.

“Inspiring people to follow a vision, and seeing people grow and develop makes me happy,” he says, adding: “During my professional journey I have had the pleasure to try different things – from start-ups to global enterprises, and from managing an individual contribution to leading thousands of people. This has shaped me and it is not the end – it is just the beginning.”

Sustainability is also core to Markert’s work at Siemens.

“At Siemens, the topic of sustainability has been relevant since the 1970s,” he says. “But since then we’ve significantly expanded our approach.

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August 2023

“Today we’re working with a holistic framework that we defined ourselves and are taking our commitment to a new level,” says Markert.

“For us, there are many projects that are relevant in terms of sustainability – from small pilot projects in e-mobility through to intelligent transport control, and the entire planning of the supply chain. Here, the most important lever is overall network planning.”

Siemens currently has an estimated 500,000 products in the field, each with a unique product footprints – which Markert says means “we cannot rely on normal evolution to achieve our set goals”.

He adds: “All stakeholders and business units are currently subject to continuous change, and this also applies to supply chains and logistics. In the future, sustainability will be an equally important issue alongside those of costs, liquidity and performance.”

Markert feels business must act now on sustainability. “Just do it,” he says.

“Don’t get stuck with discussions and analyses. These can also be smaller projects within a defined framework, for example from product development.

But of course, there are also examples of this kind in logistics, such as the switch to electric vehicles with guaranteed green electricity.”

LIFETIME OF ACHIEVEMENT

WATCH NOW

“With sustainability, just do it. Don’t get stuck in discussions and analyses” supplychaindigital.com

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INTERVIEW WITH...

ÁINE FANNING Áine Fanning, Managing Director of the Cpl Talent Evolution Group, on managing the skills revolution in procurement INTRODUCE YOURSELF AND YOUR ROLE

» Cpl is a global provider of workforce

solutions to organisations, with clients ranging from startup companies to multinational corporations. Cpl’s Talent Evolution Group is built from our need to not just provide, but evolve, solutions to meet our clients’ changing needs.

Procurement leaders in our client organisations are often partners on these journeys. Our solutions range from contingent workforce programmes, through to crafting innovative solutions to new talent challenges.

BIGGEST SUPPLY CHAIN SKILLS GAPS?

» Supply chain functions have changed significantly in recent years; the right talent can be challenging to find at all levels across these teams. The biggest

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August 2023

skills gaps are at the operational level. This is most notable in the manufacturing and pharmaceutical industries in the warehouse and logistics spaces. There are also gaps in technology and business-intelligence supply chain roles.

Procurement is also going through its own revolution, requiring varied skill sets. It’s no longer just about suppliers and cost management, but also about supplier ecosystem development, and how this can bring value and innovation to organisations (while also driving ESG strategic agendas). This has led to the need for new procurement skill sets, in the areas of sustainability and diversity.

We are seeing an increasing demand for technology-driven skills – from data analytics and automation to technology enablement across all supply chain functions.

“ Procurement is no longer just about suppliers and cost management but also supplier ecosystem development”

INTERVIEW WITH...

“Tech transformation has meant supply chain and procurement professionals have had to review the skills needed in their teams”

WHAT’S CAUSING THESE SKILLS GAPS?

» Technology transformation has

ÁINE FANNING TITLE: MANAGING DIRECTOR COMPANY: CPL TALENT EVOLUTION GROUP

“I believe embracing diversity in a talent environment enables companies to thrive,” says Fanning. “Recognising talent does not fit a singular mould.”

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August 2023

meant supply chain and procurement professionals have had to review the skills needed in their teams, both today and for the digitally transformed future they’re working towards.

We have seen a rise in the skills requirements for agility, sustainability and resilience. This has led to new ways of working. Both traditional and new roles now require newer skills.

WHAT’S THE ANSWER TO SUPPLY CHAIN SKILLS SHORTAGES?

» As many ‘new’ skills are not part of

current or traditional role requirements within supply chain and procurement, we have partnered with our clients to support their talent strategies.

This might mean looking at a skills assessment in their organisation, and identifying future talent needs. Such partnerships can often lead to a multi-

WATCH NOW

tiered strategy, including components such as investing in upskilling the current workforce, as well as identifying and hiring new role-types.

There is greater emphasis now on how to screen and assess candidates based on transferable skills, aptitude and attitude over linear work and sector experience.

This might mean partnering with clients to develop talent-attraction strategies and bespoke recruitment marketing strategies, to target candidates who might have transferable skills sets but lack industry experience.

Such people might not have considered careers in supply chain.

WHO INSPIRES YOU?

» My teams inspire me every day.

Their focus on our clients and commitment to finding innovative ways to deliver the best solutions to meet our client needs creates an invigorating environment of both collaboration

and innovation. Even when times are challenging, and we must react quickly to clients ramping up or scaling down, the attitude, approach, and positivity of the team can make a challenging job much easier.

On a personal note, my mother has always been an inspiration for me, in her positive and respectful approach to everyone she encounters. This quality has enabled me to be a positive female leader, and to have authentic and meaningful partnerships with our clients.

BEST ADVICE EVER RECEIVED?

» To embrace change and find

solutions to challenges, even if at first they seem out of the box. The value of this was demonstrated during the pandemic, when we all had to show adaptability and agility. We embraced ways of working that may have once seemed improbable, and major projects were able to be completed overnight.

supplychaindigital.com

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The Portfolio

WORK WITH US

RHI Magnesita’s pandemic problems: a catalyst for change WRITTEN BY: SEAN ASHCROFT

26

August 2023

PRODUCED BY: CRAIG KILLINGBACK

RHI MAGNESITA

supplychaindigital.com

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RHI MAGNESITA

How refractories specialist RHI Magnesita transformed its supply chain, and its mindset

T

he refractories industry is one that many people may know little or nothing about, yet it plays a pivotal part in many manufacturing processes, and without it all goods produced using high temperatures would cease production.

Refractories are heat-resistant materials used in industrial processes that require high temperatures – so anything that involves the use of furnaces, kilns and reactors. Refractories can withstand extreme temperatures and harsh operating conditions, ensuring the efficient and safe operation of industrial processes.

Typical minerals used in the production of refractories include magnesite (magnesium carbonate) and dolomite (calcium magnesium carbonate). Such materials are used to form heat-resistant bricks and surfaces for high-temperature equipment.

RHI Magnesita is the world market leader in refractory solutions, and its customers typically work in the steel, cement, nonferrous metals and glass industries.

Because RHI Magnesita products are such an integral part of heat-driven manufacturing processes, many, many businesses rely in its supply chain to deliver the refractory products they need, when they need them.

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August 2023

Simone Oremovic Executive VP People, Projects & SCM, RHI Magnesita

RHI MAGNESITA

“ Asking for help is a sign of strength, not weakness” SIMONE OREMOVIC

EXECUTIVE VP PEOPLE, PROJECTS & SCM, RHI MAGNESITA

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August 2023

33

Main production sites (incl. raw material sites)

100+

Countries shipped to worldwide

5

R&D hubs and centres

Inspection during maintenance of a rotary kiln

Overseeing RHI Magnesita’s supply chain – and much else besides – is Simone Oremovic, whose three-pillared title is EVP, People & Culture, Supply Chain Projects, and Integrations.

“Ours are not well-known products most of the time but are essential for our modern lives,” says Oremovic. “They’re needed in the production of steel, cement and glass.

So the construction industry needs us.

The car industry needs us. In mobile phones, there are components that couldn’t be produced without refractory.”

“If we stopped production,” she says, with a serious look, “we would stop steel-making production worldwide within a few weeks.”

Dolomite and magnesite are the core product the company uses, and these are extracted via mining activities.

“We have some mines ourselves,” says Oremovic, “but sometimes we need to buy raw material on the market. supplychaindigital.com

31

RHI MAGNESITA

Mining at RHI Magnesita’s plant in Breitenau, Austria

“ We can say we’re a very reliable partner again for our customers, and that’s what counts” SIMONE OREMOVIC

EXECUTIVE VP PEOPLE, PROJECTS & SCM, RHI MAGNESITA

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August 2023

The company’s biggest mine is in Brazil, and it also has mines in the US, China, Turkey and smaller ones in Europe, including Austria. “We obviously also try to match our production footprint to the existence of the raw materials,” she explains.

The pandemic was a huge challenge, and was the catalyst for RHI Magnesita to transform its supply chain, particularly around logistics.

The company has shifted from a very centralised global model to a much more regionalised model.

SIMONE OREMOVIC TITLE: EXECUTIVE VP PEOPLE, PROJECTS & SCM COMPANY: RHI MAGNESITA INDUSTRY: SUPPLY CHAIN

EXECUTIVE BIO

LOCATION: VIENNA, AUSTRIA Senior Executive with 25 years of experience in the field of People & Culture, Communication, Project Management and Supply Chain.

Experience gained in various industries as well as in consulting environment. Strategic partner with strong execution focus, roles in corporate and line function operations established a wide professional network thereby. Cultural sensitivity and language capabilities through multiple assignments and studies in different countries

worldwide. Strong external orientation through Board Member role with guest speaking at conferences and publications.

Specialties: HR Strategy, Leadership Development, Talent Management, Compensation & Benefit, Recruiting, Learning, Coaching, works council interface, Strategic portfolio management, Six Sigma Master Black Belt, agile project methodology, Internal communication, PR strategy, Supply Chain strategy, Logistics, IBP Cycle.

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RHI Magnesita’s pandemic problems a catalyst for change WATCH NOW

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August 2023

RHI MAGNESITA

“We made a conscious choice to strike strategic alliances with transportation and freight forwarding companies” SIMONE OREMOVIC

EXECUTIVE VP PEOPLE, PROJECTS & SCM, RHI MAGNESITA

RHI Magnesita sustainability

“Today it’s about being closer to our markets and customers – giving them the confidence we are here, and that the accessibility to our products is here.”

Such a transformation required that the company ask some fundamental questions of itself.

“The choice we faced is whether we wanted to be a transportation company in addition to being a refractory company?

We asked this question because we were so disrupted by the pandemic, and this left us feeling so suddenly dependent on our transportation and logistics providers.”

In the end, the company decided that

it did not wish to be a logistics company but that it did need to change its approach to transportation.

“We realised we could no longer be opportunistic, buying a container here, a container there, and cancelling one here or there. We needed partnerships.”

She adds: “We made a conscious choice to strike strategic alliances with transportation and freight forwarding companies. We needed them to commit to volumes, but also to a sustainability roadmap that we could embark on together. Data sharing was another important part of it.” supplychaindigital.com

35

RHI MAGNESITA

Setting itself down the route of partnerships also meant the company had to adapt its processes.

“With the processes, we opted for a transportation management system.

We have invested in software but also new skills, capabilities and ways of working – because such things only work when you work holistically, from top to bottom.”

So what difference has the transformation made – both to RHI Magnesita and its customers?

“Before, things were very operational,” says Oremovic, “Once we had products to ship we looked at the best options to transport. We bought the transportation, and we shipped it. Now, three things are very different.”

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Learn how you can experience the JAS difference

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August 2023

RHI Magnesita’s plant in Veitsch, Austria

“ Visibility is something we now have more and more in our company, not just in supply chain” SIMONE OREMOVIC

EXECUTIVE VP PEOPLE, PROJECTS & SCM, RHI MAGNESITA

The first, she says, is the company’s data intelligence: “We know much better in advance how much we need, from where, to where, and what the best routes are. Our approach to quality and professionalism has changed.”

She adds: “It was a big investment, not just in tech, but also people. We’ve upgraded the team, and have invested in headcount. You need the right people with the right mindset and skills. Of course, you also need processes to help them.”

The second big change is its investment in information technology. supplychaindigital.com

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RHI MAGNESITA

RHI Magnesita rotary kiln, Hochfilzen, Austria

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August 2023

“We have partners on the IT and system side, who have helped provide end-toend visibility,” she explains. “Visibility is something we now have more and more in our company, not just in supply chain.”

The third pillar of change is the company’s new-found partner ecosystem.

JAS Freight Forwarding is one such partner.

“They’re now an exclusive partner for us in certain regions,” says Oremovic.

RHI Magnesita’s partners have helped it shorten its supply chain in technology terms, even if physically it is the same size.

“Mines are mines,” says Oremovic.

“They are where they are; you can’t move them. So the production footprint has not changed, but the demand planning has.”

“We knew we needed better transparency on inventory. How much coverage do we need?

How regional can inventory be?”

SIMONE OREMOVIC

EXECUTIVE VP PEOPLE, PROJECTS & SCM, RHI MAGNESITA

supplychaindigital.com

39

RHI MAGNESITA

She adds: “In the past we had a simplistic view. Sales tells you what you need to produce, make a demand plan, translate this into production, and that was it.

“But now, we challenge this much more.

How much safety buffer is in the demand plan? How reliable is it? How good is the data? This is now the starting point.”

“A supply chain is optimised only when input data is reliable. This wasn’t any big system implementation. There was no big capital expenditure. It was a mindset change, and that’s often the hardest.

It’s hard to tell every single salesperson to do things differently, but this is where we started.”

A big focus in the transformation process was on inventory.

“We knew we needed better transparency on inventory,” Oremovic says.

“How much coverage do we need?

How regional can the inventory be?

How can we optimise the warehousing strategy? These were the kind of answers

RHI Magnesita quality control

40

August 2023

“ We’re better prepared in terms of data, knowledge, transparency, and forecasting capabilities, which cannot be underestimated” SIMONE OREMOVIC

EXECUTIVE VP PEOPLE, PROJECTS & SCM, RHI MAGNESITA

we needed, so this is really optimising the core part of the supply chain, and it’s hugely important as it’s linked to working capital.”

Optimising transport was another area of focus. To do this, the company looked at a regional-for-regional model.

Oremovic says: “We rearranged our footprint, which was very complex for us, by looking at what production could be done somewhere else by product transfers. Product transfers can take months but we have done this in certain instances to regionalise things more.

“This is a learning out of the pandemic, because we saw how dependent we were on transportation, and how painful it was to see ports closed, borders closed and workforces being unavailable.”

This all means the company is also more resilient.

“We’re better prepared in terms of data, knowledge,

RHI Magnesita sustainability

transparency, and forecasting capabilities, which cannot be underestimated. We are better prepared because we have strategic partners but also because we are much more regional.”

So much for the benefits to RHI Magnesita of the transformation; what about the benefits to its customers?

“The biggest benefit for our customers is the reliability of our products,” says Oremovic. “At the end of the day, what’s a customer’s biggest need? They want products on time – so the big plus for them is that everything arrives in full and on time.“ But she concedes that certain customers prize other things just as highly as reliability.

“It’s also the service we give in addition,” says Oremovic. “Sometimes it’s the price component, or it’s also the fact that we are flexible in how we adapt certain products

13.5K+

Employees

€3.3bn

2022 revenue

€77mn

Investment in R&D and Technical Marketing including low-CO2emission products

1.5K+

Active patents

RHI MAGNESITA

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August 2023

for customers. But ultimately, once you have an agreement with a customer they all want what they have ordered in time.”

“We have improved our delivery massively. We had moments where we had a very low-score percentage on deliveries, due to all these disruptions.

Non-availability of raw material. Nonavailability of labour, due to COVID. Shifts that we had to shut down. Transportation that wasn’t available. Energy prices that were crazy.

“This is why we had to rethink. And now we can say we are a very reliable partner again for our customers. And that’s at the end of the day what counts.”

But amid all the changes, the biggest challenge was taking its people along with it on the transformation journey – something for which Oremovic was uniquely qualified.

“I came with 20 years’ experience of people and culture, particularly on leadership and integration work,” she explains. “This was the reason I was hired.

I joined at a time when RHI and Magnesita merged – the numbers one and two in the market. They brought me in because of my people-management experience.”

She adds: “as well as people management, supply chain is a big part of my job. Some might say supply chain is very different to a people-and-culture job but I don’t think so, particularly when you get to executive level. You need a vision, you need to inspire, and to give guidance and clarity. You also need the right people with the right mindset and skills.”

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COMING SOON

AWARDS 2024 The Global Supply Chain Awards 2024 will be celebrating the very

best in Procurement & Supply Chain with the following categories: Procurement Transformation Award – Digital Supply Chain Award – Global Logistics Award – Supplier Diversity Award – Supply Chain Innovation Award – Supply Chain Sustainability Award – Procurement Technology Award – Procurement Consultancy Award – Future Leader Award – Executive of the Year Award – Project of the Year Award – Lifetime Achievement Award

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SUPPLY CHAIN

SUPPLIER INNOVATION

SHAPING THE FUTURE OF PROCUREMENT

Mere cost control can no longer be the sole focus for procurement, which now has to leverage supplier innovation to drive competitive advantage WRITTEN BY: SEAN ASHCROFT

M

cKinsey research shows that organisations that regularly innovate in partnership with suppliers are more likely to see the biggest earnings growth – sometimes up to 10% more.

Supply chain leaders, especially in procurement, already know this, because 88% of respondents to the survey – called Reimagining Procurement for the Next Normal – said they were already running joint-innovation initiatives with suppliers, or were planning to do so.

That report was published back in 2020, in the midst of a pandemic that was a catalyst for supplier innovation, as organisations sought to make procurement and supply chain more-strategic in nature. In the three years since, leveraging supplier innovation 46

August 2023

has become pivotal to achieving competitive advantage.

Here, we share insight on the subject of supplier innovation, from three people extremely well-placed to comment. All were speaking as members of panel on a virtual event held by Digital Procurement World.

Elvire Regnier Lussier (ERL) is a former CPO with the L’OCCITANE Group and is now a CPO consultant and coach.

Mark Perera, (MP) is Chairman & Founder of Visibl, a supplier relationship management platform.

Alexandra Tarmo, (AT) is the newly named VP of Procurement Center of Excellence with American consumer health company, Kenvue, having previously been Head of Partnerships & Social Procurement with Unilever.

Elvire Regnier Lussier

Mark Perera

Alexandra Tarmo

CPO CONSULTANT AND COACH

CHAIRMAN & FOUNDER

VP, PROCUREMENT CENTER OF EXCELLENCE

INDUSTRY: PROFESSIONAL SERVICES Lussier is a former CPO with the L’OCCITANE Group, a French luxury retailer of personal care products and home products. “My vision is that regenerative procurement is the future of procurement,” she says.

COMPANY: VISIBL INDUSTRY: SUPPLIER RELATIONSHIP MANAGEMENT Perera founded Vizibl to support supply chain decarbonisation through effective supplier collaboration and innovation. “I am committed to driving sustainable and responsible procurement,” he says

COMPANY: KENVUE INDUSTRY: HEALTHCARE Before joining American consumer health company Kenvue, Tarmo was previously Head of Partnerships & Social Procurement with Unilever.

“I am a passionate procurement leader, embracing DE&I every day, and aiming to make the world a better place,” she says.

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SUPPLY CHAIN

CUMULATIVE TRS PERFORMANCE, INDEXED TO 100 (FY2007) 140

ECONOMIC DOWNTURN

RECOVERY

GROWTH

PROCUREMENT LEADERS

120

PROCUREMENT FOLLOWERS

100

80

60

40

2007

2013

Following the global financial crisis (GFC), Procurement Leaders significantly outperformed Followers

42%

higher cumulative TRS in the 5 years post crisis

~3 years faster recovery to pre GFC TRS

How important is supplier collaboration?

MP: McKinsey’s statistics show that 70% of innovation comes externally, and also that those companies with mature, deep supply collaboration can increase the speed of commercialising innovation by 40%. So if you add those two numbers together – leaning in on the suppliers for innovation and the ability to commercialise it – it’s kind of a magic combination for organisations.

AT: At Unilever, during Covid, we were totally taken by the need for innovation.

Our business totally changed.

We were not really doing hand sanitiser before but in a short space of time we had sanitiser products available in every country,

and this happened only because we had extremely high levels of collaboration.

We had to learn how to do this in weeks – not months, as would be usual. We had to rethink processes internally and how we managed innovation, including how we onboarded many new suppliers.

How does digitalisation help supplier innovation?

MP: Innovation projects allow communications to flow in the right way across cross-functional teams. So digital helps break down the internal silos, but you’re also trying to optimise the relationship management side, and not just with big suppliers, but startups as well. supplychaindigital.com

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Supplier-Enabled Innovation: Critical Success Factors WATCH NOW

It’s important to engage with startups and understand their proof of concept (POC) and why they want to work with you, because that’s their livelihood, and they’ve invested a huge amount in that. So you need to know how that POC works, and then scale that up in your organisation.

ERL: Digitalisation is changing the profile of procurement teams. You had many people in charge of transactions but fewer in charge of supply relationship, or strategy. This is changing, as automation is helping free-up time on the transactional side, leaving more scope for people on the strategic side – the collaboration side.

How important are partnerships to innovation?

AT: At Unilever, the partnership strategy was built around three pillars, one of which was 50

August 2023

innovation, but innovation that is responsible and transparent. And it’s also about being agile, using data analytics, because that’s how you continue to deliver value.

MP: Unilever is a great example of a company with purpose in how it works with its suppliers. Its commitments around stepping away from non-virgin plastics involves a huge amount of work with its suppliers, who are basically rebuilding its supply chain in order for it to do this.

It’s all about procurement with purpose – it’s about measuring the environmental, and economic impact.

In procurement, is it about getting the deal done, or innovation?

ERL: In the past, this is what happened, and it still happens. But we are all pushing hard to change this approach. There is a lot of

SUPPLY CHAIN

% OF ASIA-PACIFIC PROCUREMENT LEADERS WHO SELECTED THESE AS THE TOP CHALLENGES THEY FACE BECAUSE OF THE COVID-19 CRISIS

34%

Region specific shutdowns and supply disruptions

27%

Impact on cash flow and P&L

17%

Shifting market dynamics and value pools

15%

Changing ways of working

7%

Shortages created by volatile demand

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SUPPLY CHAIN

AC

LEADERS CAN RE-IMAGINE PROCUREMENT IN FIVE KEY AREAS

C AN ELE D R AD AN ATE O AL DI PT Y G IO TIC ITA N S L

room for procurement to improve, and to move towards what Mark calls ‘procurement with purpose’, what Alex was saying about transparency and trust. Unfortunately, buyers have been pushed to focus on price because this produces immediate savings, but long term this is not sustainable, and it destroys value – value in your supply chain and value on your own site.

MP: What we find is that organisations have to create a centre of excellence in terms of how they work with suppliers, and also startups. This can sit anywhere within the organisation; it doesn’t have to sit in procurement.

What we’re seeing in organisations with progressive procurement is they’re automating the transactional side, to free-up resources around business strategy, such as how organisations partner with their supplier 52

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IER PPL D P SU S AN ELO HIP N DEV TNERS VATIO PAR - INNO CO

ZE R CAT O -BAS STR E EG VAL ATEGI ORY E UE CRE S AND ATI ON

STRENGTHEN SUPPLY CHAIN RESILIENCE

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This is always linked into the CTO, the CMO or other commercial leads, depending on whether it’s on the growth, innovation or sustainability agenda.

So procurement is very much the facilitator of the innovation process, but it is not the owner of innovation.

Should you procure products, or product ecosystems?

ERL: It’s important a company has an overall strategic vision and that this is aligned with the approach of their procurement team.

The team cannot by itself do anything.

Also, with regard to supplier programmes, the point of them is collaboration, because you need strategic buyers – you need an entrepreneur mindset. So this is the basis on which you should select suppliers to include in your programme, and digital is really going to help on this side.

Strategy sharing ‘key to supplier relations’

MP: If you look in the pharma space, you’ve got new ecosystems around precision medicines [that look at the genetics, environment and lifestyle of a person in order to select treatment that could work best for them]. That’s a whole new value chain, and that’s what we’re seeing around ecosystems.

So if you take Unilever’s Home Care division, it has to create new value chains in the way it brings such products to market.

So it’s not just one product to one surface – it’s the overall product line it’s delivering and it’s all about optimising these value chains.

Companies are taking a more holistic approach now to ecosystems and value chains’ they’re not merely managing them.

All of which is driven by consumer needs, the need for personalisation and the need for speed of delivery.

With innovation, what’s in it for suppliers?

ET: It’s like getting married; you have to want to do it. It’s important when entering a partnership that you are clear about what your strategy is, and why you want to partner with someone.

Be clear on the objective, the KPI, and also be clear that sometimes we all need to adapt to a world that nobody can predict.

It’s important we are very open about this, and that we transform around this.

So although you might have long-term agreements with suppliers, it’s good to aim for simplicity and flexibility. Life can get very complicated for suppliers, especially if they are a startup or a small company.

New Vizibl CEO Richard Hogg says supply chain strategy sharing helps form “the fundamental basis for all other supplier engagement initiatives”.

He adds: “It serves to drive transparency and alignment between your organisation and its suppliers by clearly stating your strategic aims as a business.

“Strategy sharing should include short, medium, and longer term plans, and include a sense of the pains your business is responding to.

“This begins to give suppliers an idea of how they can strengthen their relationship with you based on your organisation’s priorities, and better meet and understand your needs.

“Ir should also be reciprocal, with suppliers invited to share their strategic plans for their own businesses.”

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OUTSOURCED LOGISTICS

IN A POST-PANDEMIC WORLD More companies than ever are turning to 3PL and 4PL services as they seek to collaborate on logistics to avoid supply chain disruption WRITTEN BY: SEAN ASHCROFT

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LOGISTICS

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D

an Myers is MD UK & I, for XPO Logistics, which provides innovative transportation solutions for some of the most demanding supply chains in the world.

Myers has been with the company for over 20 years and in that time has seen many changes, not least since the pandemic struck.

“Immediately after the pandemic, closedbook fixed-lane rates were the sought-after solution as businesses sought to control costs,” he says. “The pandemic drove brands to analyse expenses across the board due to shifts in supply and demand volume and the associated costs of each.”

But he says that since the start of 2023 “brands are thinking more strategically”, by “creating strategic alliances with partners to avoid any repeat of supply chain difficulties”.

“ Brands have understandable concerns when letting a partner control any aspect of their business” DAN MYERS,

MD, UK & I, XPO LOGISTICS

“They are supplementing this approach with short-term bridging solutions and contracts,” he adds, going on to explain that in today’s market, logistics suppliers must give options in: • Commitment • Costs • Sustainable solutions • Multi-modal logistics • Phased investment planning • Flexible fleet types • A 'dynamically balanced core' with a 4PL provision In terms of what XPO Logistics has to offer as a 3PL provider, Myers says “we have enormous flexibility in the framework options we offer”, and adds that it also “matches the cost element management to the client’s objectives”.

He continues: “So we could manage capital expenditure investment to suit the client’s needs, for example but we also have a rounded capability to offer hybrid, core, and flexible solutions within the networks, allowing us to move with the client's journey, whatever that may be.”

Outsourced logistics on the rise There is no doubt more firms today are outsourcing logistics than in pre-pandemic times, and Myers expects this trend to accelerate. “There are seismic changes taking place,” he says. “Some companies in specific supplychaindigital.com

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LOGISTICS

Dan Myers TITLE: MD, UK & I COMPANY: XPO LOGISTICS INDUSTRY: LOGISTICS Myers has a long history in the logistics and supply chain industry, and is skilled in operations management, warehouse operations, management, acquisition integration and business development.

sectors are investigating the cost differences between doing their own logistics and outsourcing them.

Fuel transition a point of focus Myers explains that the factor driving this is the push to outsource fuel transition, as businesses look to cut carbon emissions in their supply chains by turning from fossil fuels to greener alternatives, such as hydrotreated vegetable oil (HVO) and electric vehicles.

“Companies want the added resilience that working with a logistics specialist can offer a business,” he says “As sustainability

becomes more important for every business, they are investigating options around this, by doing cost analysis and also gleaning ideas from third-party providers.”

He adds: “Businesses are considering handing sustainability challenges to a partner, along with cost challenges but are trying to cherry-pick parts of the supply chain.

“Rather than fully outsourcing to one provider, brands seek more partners and benchmarking. I see those already outsourcing, perhaps broadening the 4PL solution they are using.” Asked what determines if a firm needs a 3PL or a 4PL provider, Myers questions if there is really supplychaindigital.com

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3rd & 4th party logistics – what’s the difference?

Fourth Party Logistics (4PL) is the model of logistics whereby manufacturers outsource the organisation and oversight of their supply chain and logistics to a single external provider.

That provider is responsible for every aspect of supply chain management. The partner controls and manages warehouses, shipping companies, freight and agents.

4PL differs from 3PL in terms of the level of control over assets in the supply chain. In 3PL, there is a higher degree of dedicated assets to an operation. In 4PL, all assets are subcontracted, meaning the business buys capacity on the market as it is required.

This can lead to cost benefits, as the outsourcer does not carry the same fixed costs as operating in a 3PL environment. It also means they are more exposed to the market forces that impact pricing, and with capacity constraints, that could result in.

“ We recommend a single logistics group oversees all aspects of the 4PL solution” DAN MYERS,

MD, UK & I, XPO LOGISTICS

any meaningful distinction between the two.

“What makes a difference is having a logistics partner that can adapt to the needs of the business,” he says. “It’s about deploying whatever resources are needed – whether they are those of the company or of subcontract partners. “Ultimately, it’s all about moving goods from where they are to where they are needed, and by when they are required.

In terms of the benefit of outsourcing logistics to a single provider, Myers says this allows a business to receive “consistent consultancy support and informed decisionmaking from data and outputs in one place”.

LOGISTICS

“There are several benefits to this,” he adds.

“For example, it is possible to benefit from shared risk and scale to dilute stake – often with cost and capital expenditure support.

Outsourcing is a partnership.”

Start point key in 3PL relationship But as with any partnership, starting from the right point is crucial. “Finding an accurate start point is essential to ensuring the partnership is effective for all parties,” says Myers. “The start point needs to be precise, or it will get lost in blue-sky thinking.”

He adds that another challenge is making sure that multiple voices don’t result in

information being mistranslated by the time it gets to suppliers. “Too many cooks really do spoil the broth,” says Myers. “As a result, essential and all associated in-house cost elements are often forgotten, and this is a significant task for the organisation paying the bill.”

He adds: “We always recommend a single logistics group overseeing all aspects of the 4PL solution, so the most significant cost savings can be identified through a thorough and rigorous cost-and-needs analysis.”

Of course, not every business feels comfortable outsourcing its logistics supplychaindigital.com

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The Future Is Bright | XPO WATCH NOW

function. “Brands have understandable concerns when it comes to letting a partner control any aspect of their business,” Myers says. “For example, the impact of poor service or incomplete deliveries resulting in customer complaints is a valid issue if a company chooses the wrong logistics partner.

“This is why it’s vital to properly vet any

Omnichannel retail is driving growth in the 4PL market, which is expected to hit

US$89.95bn by 2030

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company you plan to work with before signing any contracts. At XPO, we are acutely aware of how the decision to outsource – that loss of accountability and perceived loss of control – can be worrying for companies.”

This is why, he says, XPO goes “beyond the norm” to ensure its customers are “fully integrated into the XPO Logistics family.”

He adds that the company also ensures its staff are fully aware of all its customers’ needs and expectations.

“It can be challenging if a framework does not suit a customer’s needs or if the commercial comparison is inaccurate,” says Myers. “The other issue can be that sometimes brands glean the expertise and then try to put it into practice themselves.

They have ex-3PL people operating their in-house logistics function, so they may feel no outsourced 3PL can do it better.”

“We can manage capital expenditure investment to suit the client’s needs” DAN MYERS,

MD, UK & I, XPO LOGISTICS

SUSTAINABILITY

RENE SUPP UNDE

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EWABLE ENERGY PLY CHAINS ER PRESSURE

Renewable energy is crucial to the global move to net zero but supply chain issues around clean energy are placing serious obstacles in the road WRITTEN BY: SEAN ASHCROFT

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SUSTAINABILITY

R

enewable energy is a key plank of decarbonisation, and the move to the net zero goals laid out by world leaders during the Cop26 conference.

With supply chains accounting for up to 80% of an organisation’s carbon footprint, the shift away from fossil fuels towards renewable energies, such as solar, wind and green hydrogen, will be pivotal.

Such a global undertaking was always going to encounter significant challenges, and it seems one of these is the supply chain itself of the renewable energy projects needed to drive our net zero ambitions.

A recent WTW report shows how the adoption of more renewable energies is being hampered by supply chain problems.

Willis Towers Watson (WTW) is a global advisory company that provides datadriven solutions around risk and capital that are designed to make organisations more resilient.

Its 2023 Renewable Energy Supply Chain Risk Report says that the rising price of raw materials, combined with supply chain shortages, bottlenecks and delays, are putting the future of many renewable energy plans at risk.

WTW surveyed 100 risk and supply chain leaders in companies providing technology, infrastructure and power generation in areas including hydro, solar, wind, biofuels, geothermal, battery storage and heat pumps. supplychaindigital.com

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E X C L U S I V E W H I T E PA P E R

How to Achieve Sustainability in the Global Electronic Supply Chain KE Y THEMES: The Elements of a Sustainable 1 Global Electronics Supply Chain

2

How Companies Fall Short in Supply Chain Sustainability

3

Solutions to Help Solve Supply Base Sustainability

D OW N LOA D N OW

SUSTAINABILITY

Volatile energy costs a problem Respondents say the rising cost of materials and labour – coupled with volatile energy prices – is impacting income and growth, potentially reducing the scope for future investment in the sector.

Difficulties in attracting and retaining talent (32%) also figures prominently as a supplier problem, as the industry faces major workforce challenges, as demand for green jobs outpaces the availability of qualified workers across the supply chain.

Other problems mentioned include shortages, delays, economic issues and geopolitical instability, while sustainability and cybersecurity are also concerns.

Contractors, suppliers and equipment manufacturers working on major renewable energy projects frequently share systems, adding potential entry points for malware into sensitive equipment.

Steven Munday TITLE: GLOBAL RENEWABLE ENERGY LEAD COMPANY: WTW INDUSTRY: ADVISORY SERVICES Munday has been with WTW for seven-and-half-years, prior to which he was Renewable Energy & Power International Practice Leader for risk-management specialist, Marsh. supplychaindigital.com

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“ Complex logistics and regulations are hampering uptake of wind energy” DARCY MACCLAREN, ,

CHIEF REVENUE OFFICER FOR DIGITAL SUPPLY CHAIN, SAP

Darcy MacClaren TITLE: CHIEF REVENUE OFFICER, DIGITAL SUPPLY CHAIN COMPANY: SAP INDUSTRY: PROFESSIONAL SERVICES Darcy MacClaren is a strategic global leader who has spent 30 years growing, differentiating, and improving businesses through technology transformation with a focus on supply chain.

Cybercrime threat to clean energy Solar farms and wind turbines are also typically in isolated locations and are controlled remotely by centralised computer systems, which increases their exposure to cybercrime.

On the subject of wind power, SAP Chief Revenue Officer for Digital Supply Chain, Darcy MacClaren, warns that complex logistics and regulations are hampering uptake of wind energy.

“The complexity of what needs to be done is what folks are struggling with,” says MacClaren. “The supply chain to do this is extremely complicated.”

SUSTAINABILITY

MacClaren says the issue is that specialised materials are required to make the turbine blades, and adds that the logistics of transporting the blades – which can be as long as a football field – is also hugely challenging.

“Then you have to construct something in the middle of the ocean, which requires special ports and harbours,” she says, adding: “There’s also a lot of uncertainty about the scope of such a supply chain and the development time-frames needed to build these critical resources.”

MacClaren also cites as complicating factors the level of investment required,

that there are “gaps in manufacturing” and that “ports and vessels remain uncertain”.

Regulation is another sticking point, she says.

“It’s not just regulations from the federal government, but also from myriad local municipalities that have a say,” she explains.

“This can impede production, which adds risk and impacts the investment needed to bring these projects to fruition.”

She adds: “You’ve got to break down those barriers. You’ve got to get all these organisations working together.”

MacClaren stresses that technology can help, from a design, procurement, supplychaindigital.com

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Transforming the Clean Energy Supply Chain WATCH NOW

supply chain, logistics and manufacturing perspective.

“We can help set up a sustainable, resilient intelligent supply chain with all these involved parties,” MacClaren said. “If we can solve the uncertainty of the regulation issues people are concerned with, then we establish a strong foundation to help create a supply chain for offshore and the wind energy industry.”

MacClaren calls for “a catalyst, an industry proponent” to “blast through obstacles” and to “bring disparate parties together, to get a viable industry off the ground”.

“We need an Elon Musk,” she added, referring to Tesla’s ability to successfully mass produce and sell electric cars.

“We need a change agent, and I’m not seeing that.”

Returning to the big picture concerning renewable energy supply chain problems, the WTW report underlines the sector’s

“ Renewable energy is no longer a power sector but a technology sector” STEVEN MUNDAY,

GLOBAL RENEWABLE ENERGY LEAD, WTW

EC amends clean energy regulations An important European Commission (EC) clean energy regulation has been widened to encourage EU member states to roll-out clean energy infrastructure on the rail network.

The EC’s Alternative Fuels Infrastructure Regulation (AFIR) originally targeted electric recharging and hydrogen refuelling infrastructure for the road, maritime and inland ports detectors, as well as electricity supply to stationary aircraft. Now, it also includes rail.

The move will speed progress on EU Green Deal objectives, a set of EC policy initiatives whose aim is to make the EU climate neutral by 2050.

Under the regulation change, EU member states can assess the development of alternative fuel technologies and propulsion systems for rail sections that cannot be fully electrified for technical or costefficiency reasons.

At present, 80% of train-kilometres in Europe run on electric energy, a growing part of which comes from renewable sources. However, just 54% of the European rail network is currently electrified.

dependence on critical supplies, where the lack of even one essential item can hold up work on an entire project, which can be costly at a time of high demand.

Clean energy ‘all about the tech’ One of the report’s co-authors, Global Renewable Energy Lead, Steven Munday, says the key thing to bear in mind about renewable energy is that “it’s no longer a power sector but a technology sector”.

Speaking as part of a WTW podcast on renewable energy, he adds: “Renewable energy technology is moving ahead incredibly quickly. That does impact throughout its lifecycle in terms of origination, procurement, construction, and operations.”

SUSTAINABILITY

“As well as new technology around renewable energy there’s also an upscaling of existing tech” STEVEN MUNDAY,

GLOBAL RENEWABLE ENERGY LEAD, WTW

He adds that, as well as new technologies emerging around renewable energy, there is also an “upscaling of existing technologies”, including hydrogen, battery storage and wind technologies.

“All of this equipment has to come from somewhere,” he points out, “and we are seeing that the original equipment manufacturers of all technologies are trying to produce sufficient amounts for what is required globally.”

He adds: “That is very difficult, and it is challenging the supply chain, particularly after the pandemic, and we are seeing that there is a major impact on projects’ timelines.” Munday adds that pre-pandemic, renewable energy companies were “in a race to deliver as quickly as possible”, and that

sometimes this impacted quality, “especially if there were challenges with the workforce not having the right experience”.

He says post-pandemic, there is now “a move away from less experienced workforces” around renewable energy and also a shift away from ‘just-in-time’ delivery of projects.

He says lessons have been learned from the pandemic, with regard to supply chain interruption and availability issues, and that this is prompting organisations “to be more considered about renewable energy projects and to make sure power transformers, wind turbines or electrolysers are available at an earlier stage “to mitigate potential supply chain delivery and to avoid delay damages”. supplychaindigital.com

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RICH DATA IS SHAPING SUPPLY CHAIN STORIES 78

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Software company Epicor is using datarich solutions to help customers build responsive and resilient supply chains WRITTEN BY: SEAN ASHCROFT

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WRITTEN BY: SEAN ASHCROFT

T

he fourth industrial revolution – Industry 4.0 – is all about interconnectivity.

It marries physical production and operations with smart technology, and the goal is to help businesses improve quality, reduce risk and minimise cost. It’s a mix of software (AI and ML) and hardware (RFID devices that feed into the Internet of Things).

But the true currency of Industry 4.0 is data, which properly managed, allows unprecedented levels of transparency, automation, insight and control. One business that has placed data at the centre 80

August 2023

of its operations is Epicor, an IT company whose specialist areas include supply chain, inventory, distribution, and manufacturing production management.

Epicor says it wants to ‘tell stories’ with data, which is why it has changed tack on its hiring strategy, and is now building a data scientist team.

Tim Hardin is SVP Global Data & Extend Services with Epicor, and has been with the company for three years.

“When I first joined I didn’t think that 10 months in, we’d have hired a data science

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290 million

VEHICLES ARE REGISTERED IN THE INDUSTRY THAT ARE TARGETED BY EPICOR CUSTOMERS

TECH & AI

team that includes people with PhDs in data analytics,” he says in an interview with ITS data partner company, Microstrategy.

“It’s exciting, and I think the results are going to bear themselves out soon.”

Hardin references the automotive space as one in which Epicor is focused on using data to “inform on inventory volumes” and making sure that its customers can “make sure they have the right part at the right place at the right time”.

Working towards this, Epicor is focused on taking the entire value chain from the manufacturer, distributors, and all repair shops, and giving them a daily reading, on-demand. To this end it has built a realtime online picture of all inventory across all channels. Analytics ties its entire supply chain together.

Tim Hardin TITLE: VP GLOBAL DATA & EXTEND SERVICES COMPANY: EPICOR INDUSTRY: IT LOCATION: USA Hardin has been SVP Global Data & Extend Services for nine months.

Before that he was Senior Vice President & GM, Auto & Vista Analytics with the company.

“The data we provide is opening up new opportunities and new channels” TIM HARDIN,

SVP GLOBAL DATA & EXTEND SERVICES, EPICOR

The company’s next move is to take this to the next level, to the point where it is behaving prescriptively and predictively – anticipating and managing demand for its customers.

Industry 4.0-enabled data solutions mean Epicor is evolving quickly.

“Over the years, we’ve provided a lot of value to the automotive aftermarket, but the natural gravity of the marketplace has pulled us in directions we might not have thought about a couple of years ago.”

He adds: “For example, we have organisations in extended-service warranty asking us for information that can help them understand how they can deliver that product to market.

“We have organisations on Wall Street coming to us, for KPI data that tells them where the market is going.

“So that has shifted our thinking around the products we deliver. And that’s really more of a pull from the marketplace, not necessarily something that we’re pushing.”

The forces of change mean Epicor now has the ability to measure failure rates for car parts, which means that information can be shared with any company that has a stake in the owner-experience of a vehicle. supplychaindigital.com

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TECH & AI

The shifting concept of car ownership is also changing the way Epicor looks at its markets.

“Who is really going to own the cars of the future?” asks Hardin. “Is it a fleet? Is the fleet going to be basically shared ownership of cars? So we’re looking at the value proposition of how repair is going to be managed in terms of the service to end consumers.

“It all starts with knowing just one piece of information, and telling different stories with it, and going in different directions.

If you can predict demand for a part on any one vehicle, that story can be told in different ways.”

As for the future, data will play an evergrowing role in what Epicor is able to offer customers.

“There are about 290 million vehicles registered in the industry that are targeted by our customers, and around 100 million repair events every single year,” says Hardin.

He says the company captures multiple “touchpoints” around every single repair event, examining choices made by the repair

EPICOR LOGS AROUND

100 million

AUTOMOTIVE ‘REPAIR EVENTS’ EVERY YEAR shops around the ordering of one branded part over another.

“The aim is to add value to these choices,” he says, “so we our can track the purchase of expensive parts, less-expensive parts and economy parts, and help supply chain vendors properly price and position products based on where they see behaviour and choices going.”

In short, Epicor has a picture of every item of inventory in every location every single day, with data analytics painting pictures everyone in the industry can reference and work from. Ultimately, Epicor is looking to coordinate, optimise and build-out efficiency across an entire industry. supplychaindigital.com

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TECH & AI

Why Market Leaders are Transforming to Industry 4.0 WATCH NOW

Manufacturing ‘still at Industry 4.0 pilot stage’ – SAP A SAP-commissioned global supply chain survey shows that manufacturing chiefs recognise the need for Industry 4.0 technology to increase supply chain resiliency, but that many are yet to progress beyond the piloting stage.

It found that manufacturing leaders are more likely than those

ONLY

36%

HAVE DEPLOYED PREDICTIVE ANALYTICS

in other functions to deploy intelligent technologies at scale to improve predictive analytics capabilities.

Predictive analytics is the use of algorithms, machine learning and data mining to analyse historical data and make predictions about future events or trends. It gives organisations insight into customer behaviour and market trends. This feeds moreinformed decisions, improves customer satisfaction, reduces risks and increases profitability.

Despite this, just 36% of the 1,000 survey respondents said they have deployed predictive analytics in any part of their enterprise.

To help it handle such huge volumes of data, the company has turned to data specialists MicroStrategy, who collect the data and make it visible to everyone in the supply chain, which facilitates collaboration between manufacturers and distribution groups “We have 1,700 customers,” says Hardin.

“These are independent shops that leverage our customer-relationship management (CRM) platform, and this is the endgame for everything that we’re doing.

“As much as we focus on understanding patterns with parts, the supply chain and failure rates, ultimately what matters is the relationship with the consumer.”

Hardin says the data Epicor has today, when made visible at every level of supply chain, will create a channel-level CRM. “Everybody in the value chain – from manufacturers all the way down – will want to influence a relationship of some sort with the end consumer,” he says.

“Ultimately everything always comes back to the relationship with the consumer” TIM HARDIN,

SVP GLOBAL DATA & EXTEND SERVICES, EPICOR

He adds: “The connectivity we provide via data at all levels has created a sub-vertical for us, whereby marketing organisations within manufacturers are asking us to help them understand better how they can drive a better customer experience.

“It’s opening up new opportunities and new channels. We’re now having conversations at the C-suite level with marketing officers and those are responsible for customer experience” which is detrimental in a risk scenario.” supplychaindigital.com

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TOP 10

SUPPLY CHAIN BUSINESSES The world’s leading businesses either working directly in supply chain, supporting the supply chain industry and whose supply chains help shape our daily work and home lives WRITTEN BY: SEAN ASHCROFT

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S

upply chains shape and serve consumers and businesses alike.

Multinational organisations in the B2C and B2B spaces keep our home and work lives ticking over. Other businesses – specialists in logistics, cloud technology, AI & ML and software services – make sure that the world’s supply chains are resilient and efficient.

WATCH NOW

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10

Johnson & Johnson Johnson & Johnson (J&J) is one of the world’s largest healthcare and life sciences companies. Sectors it serves include pharmaceuticals, medical devices and consumer healthcare products. Globally, J&J employs an estimated 135,100 employees worldwide.

Its pharma offerings see it develop and manufacture an array of prescription drugs, including treatments for oncology, immunology, cardiovascular diseases and infectious diseases.

Its medical devices division produces products, such as surgical equipment, orthopaedic devices, diagnostic tools and contact lenses. J&J’s consumer health division, meanwhile, manufactures and sells wellknown brands such as Band-Aid, Listerine, Neutrogena, and Tylenol (in the US).

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August 2023

09 Oracle

Oracle is a multinational technology company develops and provides enterprise software products and services. “Our mission is to help people see data in new ways, discover insights, unlock endless possibilities,” it says.

The company is best known for its widely used relational database management system, Oracle Database, which helps organisations efficiently manage and store large amounts of structured data.

It also offers consulting and support services, to help customers implement, customise and maintain their software solutions.

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Deloitte

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Accenture Employing an estimated 624,000 people in 200 cities across 50 countries, Accenture provides solutions in strategy, consulting and operations in the space between business and technology.

Its expertise spans 40 industries and all business functions. To expand the scope of its knowledge across the areas it covers, Accenture acquires specialist consultancies, with Avieco and Greenfish in the sustainability space just two among many examples.

On logistics, Accenture helps client companies design 4PL operating models, typically featuring a network of control towers that coordinate regional and global transport that are orchestrated by 4PL providers.

Deloitte is an umbrella brand for several global independent firms, comprising tens of thousands of dedicated professionals specialising in audit, consulting, financial advisory, and tax.

One of the Big Four accounting organisations, it offers financial accounting and regulatory services, including those around sustainability requirements. Deloitte works collaboratively and dynamically by bringing together multidisciplinary teams of people with diverse perspectives, skills, and expertise.

The firm, founded in London in 1845, serves a number of industries including energy, life sciences and technology.

It currently employs an estimated 330,000 people across 150 countries.

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05

IBM WATCH NOW

06 Nestlé

Nestlé is one of the world’s largest food and beverage companies.

It operates in 190 countries and its product portfolio includes householdname brands such as Nescafé, KitKat, Maggi and Purina, among many others.

It has invested heavily in its global supply chain, with key areas of focus being ESG leadership, reducing packaging waste and new business models to improve end-to-end supply chain.

Switzerland-based Nestlé has a ‘Creating Shared Value’ strategy that drives sustainability through partnerships with suppliers and environmental organisations, as well as with other corporations.

The company says its supply chain professionals “play a critical role in ensuring quality and sustainable products reach our customers and consumers”.

IBM describes itself as a company that “brings together all the necessary technology and services – regardless of where those solutions come from – to help clients solve the most pressing business problems”.

IBM integrates technology and expertise, providing infrastructure, software – including market-leading Red Hat – and consulting services for clients as it “pursues the digital transformation of the world’s mission-critical businesses”.

“Our clients’ systems support modern society,” says IBM Chairman and CEO Arvind Krishna. “In making them faster, more productive and more secure we don’t just make business work better.

We make the world work better.”

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04 Apple

Consumer tech giant Apple is one of the world’s most valuable companies.

Its iconic and hugely popular product line includes the iPhone, iPad, Mac desktop and laptop computers, the Apple Watch, Apple TV, as well as numerous software apps, such as GarageBand.

In August 2021, Apple became the first publicly traded US company to reach a market capitalisation of $2 trillion.

Outside of its core product range, ​​ Apple also runs a global chain of Apple Stores, and in recent years it has expanded its offerings to include content and entertainment services around music, TV, gaming and fitness.

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August 2023

03 Unilever

Unilever is a multinational consumer goods operation with a rich heritage that dates back to the 19th century.

Its purpose is “to make sustainable living commonplace by offering products that enhance people’s well-being and contribute to a more sustainable future”, it says.

Unilever operates in three main areas: Beauty & Personal Care, Home Care, and Foods & Refreshment.

Within these categories, the company offers a diverse portfolio of wellknown brands including Dove, Lifebuoy, Omo, Cif, Domestos, Knorr, Lipton, Magnum, Ben & Jerry’s, Hellmann’s, and Wall’s ice cream.

Unilever says it “strives to be a responsible and trusted company that contributes to a more sustainable and equitable world”.

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02

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Amazon

Founded in 1994 by Jeff Bezos, Amazon started as an online marketplace for books but today is a global leader in e-commerce, cloud computing, digital streaming, and AI. Beyond retail, Amazon has diversified into B2B services. Amazon Web Services (AWS) is a cloud computing platform offering cloud services, including computing power, storage, database management and AI. It has also built a vast logistics infrastructure, to ensure fast and efficient product delivery, operating fulfilment centres worldwide. It also employs its own last-mile network, and has introduced innovative delivery methods such as Amazon Prime Air, an unmanned drone delivery system. supplychaindigital.com

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August 2023

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Microsoft Microsoft’s mission is “to empower every person and organisation on the planet to achieve more”. To this end, it creates innovative tech solutions that enable individuals, businesses, and communities to realise their full potential.

Microsoft is known for its flagship operating system, Windows, which powers a majority of PCs worldwide.

It also develops and distributes

software including the Office Suite, Azure cloud platform, and Visual Studio development tools.

Microsoft Azure, meanwhile, is a cloud computing platform that provides infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS) solutions to businesses in sectors including computing, storage, networking, analytics and AI.

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