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SUPPLY CHAIN TRANSFORMATION IN RETAIL SECTOR

FEBRUARY 20 19

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THE POWER OF AI Competitive advantage through digital transformation

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Digital disruption of the supply chain JOHAN REVENTBERG, PRESIDENT, EMEA AT JDA, EXPLORES THE COMPLEXITY OF TECHNOLOGY AND DIGITALISATION

TOP 10

Procurement Professionals


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WELCOME

H

ello and welcome to the February edition of Supply Chain Digital

Our cover star this month is JDA Software, as Johan Reventberg, President, EMEA, discusses the challenges and the complexity of the digitisation of the supply chain and procurement function. “Digitisiation is literally what everyone is talking about and it’s making companies ask the question as to how they can embrace digital in order to move forward,” says Reventberg. Elsewhere, we speak to Mike Landry, Senior Supply Chain Management Consultant at Genpact on how the transformation of the retail supply chain continues to be powered by technology. What is the true impact of Artificial Intelligence? Ed Cross, Executive Director of Odesma takes an in-depth look at the role of AI in monitoring and understanding changing trends and

habits in real-time in the manufacturing supply chain. With Brexit defining the political conversation, now more than ever is the time to ensure tighter supply chain management in order to avoid financial risk and operational downtime. We have an exclusive feature from Chris Robert03 son, CEO of Creditsafe as he believes effective supply chain management will prove key in an unstable climate. Our top 10 this month looks at the top 10 procurement professionals, as ranked by the CIPS Procurement Power List. We also have exclusive reports with AB InBev, Drexel University Procurement Services, OSM Maritime Group and Creation Technologies. Enjoy the issue! Dale Benton. dale.benton@bizclikmedia.com

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CONTENTS

10 JDA

Navigating the digital disruption of the supply chain and procurement landscape

22

32

Genpact:

UNCONSTRAINED BY THE PAST

EFFECTIVE SUPPLY CHAIN MANAGEMENT


38 AI in the manufacturing supply chain

48

62 Events & Associations

Procurement Professionals


CONTENTS

66 LSC Communications

THE FLOW OF INFORMATION: LSC’S SUPPLY CHAIN TRANSFORMATION

Drexel University

84 102 Warehousing, Education and Reseach Council

PROCUREMENT TRANSFORMATION IN THE HEART OF PHILADELPHIA

Warehouse benchmarking study is a top tool for measuring performance


112

134 Creation Technologies

ACCENT GROUP A SUPPLY CHAIN TRANSFORMATION

COLLABORATION ACROSS THE DIGITAL SUPPLY CHAIN

152

174

OSM Maritime Group

Competitive advantage through digital transformation

Essilor

Delivering the gift of sight through a robust supply chain transformation


LEADERSHIP

10

Navigating the digital disruption of the supply chain and procurement landscape Johan Reventberg, President, EMEA at JDA Software, discusses the challenges and complexity of digitising the supply chain and procurement function WRITTEN BY

FEBRUARY 2019

DA LE BENTON


11

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LEADERSHIP

T

he supply chain and procurement function is changing and companies all over the world are waking up to the realisation that procure-

ment can be more than just a cost centre or a profit

driver, it can be the key to strategic growth. Defining this realisation, is technology and digital transformation. Companies all over the world are looking to provide an “Amazon-like” experience for both customers and suppliers alike and this has pushed digital to the very top of the table across supply chain and procurement. This is certainly the belief of Johan Reventberg, President, EMEA at JDA Software. “Digitisation is literally what everyone 12

is talking about and its making companies ask the question as to how they can embrace digital in order to move forward,” he says. “But what’s important is to realise that some companies aren’t normal retailers or manufacturers, they are IT companies with a very strong supply chain.” JDA Software is a world leader in delivering end-to-end supply chain solutions that enable companies to seamlessly connect their supply chains and profit more in “an omni-channel world.” Its very mission statement, which it delivers to more than 4,000 global customers is to seamlessly connect the supply chain so that companies can deliver for its customers. “We are a trusted advisor in the supply chain space. We sit in the core of our customers and provide services as well as advice on the FEBRUARY 2019


“Digitisation is literally what everyone is talking about and it’s making companies how they can embrace digital in order to move forward” — Johan Reventberg, President, EMEA at JDA Software

strategic value that we can help them

best practice. Reventberg himself

achieve and how better to compete

describes JDA as a company that is

with competitors,” says Reventberg.

the good guy wanting to help both

“Through our software and our service,

existing and new companies to win in

we work with customers to take their

the marketplace by being supply chain

supply chain to the next level.”

focused. As the supply chain and

JDA works with companies to help

procurement landscape has evolved,

them navigate the digital world in order

this has placed greater pressure on

to extract value and to provide industry

companies to wake up to technology, w w w.suppl yc ha i ndi gi ta l. com

13


LEADERSHIP

but with this sharper focus comes

our customers understand it and they

added risk. Investing in technology

can start seeing the benefit and they

is a risk and if it goes wrong it

can start driving and using that in their

becomes a costly one at that. This is

businesses.”

where JDA comes in, working with its

14

As the conversation continues to

customer base to enable them to make

be defined by technology and its place

smarter and more precise decisions

in the industry, it can be easy to forget

and the key to that is data. “For us its

that the supply chain alone is a very

really about taking the data analysis,

complex space. Companies looking

understanding it and providing it to our

to compete and to gain an edge on

customers so they too can see true

competitors are at risk of running

value and opportunity in it,” he says.

before they can walk and Reventberg

“The thing with data is that we have lots

believes that in this regard, the industry

of it. It’s there today and we need to

should never underestimate the power

make sure we make it consumable so

of human interaction. Technology will

“For us it’s really about taking the data analysis, understanding it and providing it to our customers so they too can see true value and opportunity in it” FEBRUARY 2019

— Johan Reventberg, President, EMEA at JDA Software


CLICK TO WATCH : JDA – DELIVERING A SEAMLESS SUPPLY CHAIN 15 always empower individuals, but he

and our associates and enable the

feels that if a company or a board’s

workforce of the future.”

expectations are unrealistic, it’s a recipe

An example that Reventberg high-

for failure. “It’s a lack of understanding

lights is that of the retail sector and

of the complexity of digitisation in the

how the traditional model of being

supply chain. It is still highly complex,”

stood behind a cash register evolved

he says. “The systems, the level of

into greater customer interaction, add-

support required and the suppliers

ing more value and upselling. He takes

and skills within the supply chain are

it further and points to the digital store

more sophisticated than ever before.

and how its key to train and get people

As a company, you have to educate

on board within the journey or fail to

and train your workforce otherwise

find the right balance and fail to adapt.

they become a risk to themselves

The key to understanding this

and to the company and mistakes

challenge, training and upskilling people

will happen. We must train our people

and embracing technologies, is knowlw w w.suppl yc ha i ndi gi ta l. com


C P O C S C O S T R AT E G Y

1985

Year founded

4,300 Approximate number of employees

16

42

Number of global offices

edge. As a passionate technologist,

share experiences and use cases and

Reventberg recognises the responsi-

bring that back to his role within JDA.

bility that he and JDA has in recognis-

But it doesn’t stop there. JDA has

ing and being privy to innovative new

a number of internal programmes and

technologies in order to be able to

training workshops centred around

work with customers and help them

educating the workforce. “For me it’s

implement. Through his role, Revent-

about how do we take internal knowl-

berg is exposed to technology

edge and spread it across. We spend

influencers and professionals from all

a very significant part on internal training.

over the world and this allows him to

We also have innovation weeks and in-

FEBRUARY 2019


17

novation workshops within the compa-

business and even modern life, the

ny,� he says. This also extends to its cus-

traditional lines or barriers between

tomer base, as JDA also works closely

technology adoption have begun to

with customers and creates a think tank

disappear. This is often referred to as

mentality with them in order to better un-

digital convergence, where once upon

derstand the technology requirements

a time, technology in the healthcare

and skills needed in order to drive value.

sector would have no use case in sup-

Technology is of course not exclu-

ply chain. But as Reventberg notes, he

sive to the supply chain industry and

and many others like him are looking

as it continues to redefine modern

at how other sectors are implementw w w.suppl yc ha i ndi gi ta l. com


LEADERSHIP

ing technologies and exploring how it can be replicated in the supply chain space. Ultimately though, it’s the customer that defines the digital roadmap. “We have industry experts that we work with out in the field that are driving ideas and looking at

“We must train our people and associates and enable the workforce of the future”

trends,” says Reventberg. “They work across different verticals in

— Johan Reventberg, President, EMEA at JDA Software

different industries and together with our customers, our executive teams and our innovation team they feed back 18

and develop where we go next with our R&D spending in a very transparent way.” The digital transformation of the supply chain shows no signs of slowing down and JDA will continue to position itself as a key player in furthering this transforming landscape for some of the biggest companies in the world. Reventberg calls back to the company’s mission and vision. “Personally, I have an agenda to make JDA the best possible version of itself,” he says. “But it’s about continuing to deliver an autonomous supply chain promise and the vision around that. Taking our existing customers to the best they can be in their supply chain area.” FEBRUARY 2019


19

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Covering every angle in the digital age The Business Chief platforms offer insight on the trends influencing C and V-level executives, telling the stories that matter

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PROCUREMENT INSIGHTS

22

The supply chains of the future unconstrained by the ones of the past Mike Landry, Senior Supply Chain Management Consultant at Genpact, discusses how the transformation of the retail supply chain continues to be powered by technology WRITTEN BY

FEBRUARY 2019

DA LE BENTON


23

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PROCUREMENT INSIGHTS

O

ver the last ten years, major companies all over the world have built their supply chains to be efficient. This

is particularly true in the consumer goods space due to the tighter margin pressures at play. As the supply chain conversation has shifted in recent years, these same companies are now facing the challenge of rebuilding or adapting those efficient and robust supply chains to be measured on agility. The key to this has been the disruptive nature of technology. Mike Landry, Senior Supply

Chain Management Consultant at Genpact, 24

believes that technology will ultimately prove to be both the key challenge and the key to overcoming it. “The question for businesses now is, how do they change the dynamics of the supply chain without disrupting the business?” he says. “The good news is that, the changing face of technology is inspiring agility. It’s changing and allowing companies to have a new perspective on the supply chain.” Genpact is a global professional services firm that “makes business transformation real.” It achieves this through digital-led innovation and digital-enabled intelligent operation for clients from Global Fortune 500 companies. Landry’s role sees him work closely with these companies to answer the digital supply chain question. Landry is FEBRUARY 2019

“The good news is that the changing face of technology is inspiring agility. It’s changing and allowing companies to have a new perspective on the supply chain” — Mike Landry, Senior Supply Chain Management Consultant at Genpact


keen to point to the changing conver-

penalties as a consequence. Landry

sation of supply chain and looks at a

says that this has had a ripple effect

major consumer goods company like

on the industry, with a large number

Wal-Mart and the introduction of its

of companies now looking to repli-

On Time in Full (OTIF) standard which

cate this standard to their own sup-

has been applied to all of its suppli-

pliers. “More and more retailers are

ers. This new list of vendor guidelines

now introducing their own version of

and scorecard parameters is designed

these standards and penalties to their

to keep its suppliers in check in order

own suppliers,” he says. “It’s a sign

to ensure the company has the right

that as one company in the industry

products it has when it needs them, re-

or as the ecosystem gets better, the

duce overstocked inventory and most

expectation of others increases.”

importantly, improve the response to

“No one company can improve on

short orders. If a supplier fails to meet

its own and this spreads across the

these standards, then there are cost

industry as a whole where weak links

CLICK TO WATCH : GENPACT: TRANSFORMATION HAPPENS HERE

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25


PROCUREMENT INSIGHTS

will impact multiple companies. All of

26

With the changing landscape of

these dynamics are putting more pres-

supply chain, how has this changed

sure on companies to improve and to

the role of the procurement profes-

change, and technology is proving key.”

sional? As technology has evolved,

The major challenge with transform-

technology professionals have seen

ing a supply chain is the complexity of

their roles become much more en-

it all. There are a number of sub func-

grained within company strategy and

tions and sectors within a single supply

the same is happening to the Chief

chain and the trend across the industry

Procurement Officer and right across

is to break these various elements

the supply chain board. Landry notes

up and then connect them through

that with technologies such as au-

innovative and smart technology. De-

tomation, computing and the cloud,

mand planning, inventory planning and

entire organisational alignment will

production planning and scheduling as

look very different in the coming years

well as transportation and warehouse

as it “completely opens the door for a

and order management are all differ-

new way of running the supply chain”.

ent but very crucial parts of the retail

“We just have to have open minds. We

supply chain, and Landry believes that

can’t predict what it’s going to look like,

the way forward is to create a cognitive

but we know its going to be different,”

supply chain with end-to-end visibility.

says Landry. “Regardless of what the

“Traditionally you’ll find siloed ways

future holds and what technology will

of working in the supply chain and so

bring, people will always be involved in

our vision with Genpact is to be the as-

every step of it. We just need to figure

sembler of technology to better con-

it out. We can’t ever make it lights out.”

nect each part,” he says. “We’ll put in

Technologies such as the Internet

the plumbing and digital putty between

of Things (IoT), cloud computing and

each independent system and develop

machine learning are defining the cur-

a much more cognitive, learning, adap-

rent supply chain technology con-

tive and supply chain that will drive

versation. The commonality between

better decision making and profit.”

them all is data. In the supply chain

FEBRUARY 2019


27

“Traditionally you’ll find siloed ways of working in the supply chain and so our vision with Genpact is to be the assembler of technology to better connect each part” — Mike Landry, Senior Supply Chain Management Consultant at Genpact

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PROCUREMENT INSIGHTS

ecosystem, there is no shortage of data and Landry challenges people to look beyond the data that we automatically think of and look at the unstructured data. Unstructured data provides a sea of opportunity, but the key is unlocking that data. “When we start to get information from images and unstructured data and get real value from it, that will define the future,” he says. “Processing that data and turning it into information will help people achieve more. Right now, the data and the tools already at our disposal are phenomenal and its only going to get better.” 28

It’s easy to get carried away when discussing the possibilities of technology and data and despite organisations actively encouraging the digitisation of industry, there is still a mentality and a fear of potential failure. There is huge risk in being a first adopter and nobody ever wants to be seen to be lagging

“There’s a whole set of infrastructures out there which will allow new companies to ramp up very quickly with not a lot of capital and implement the supply chain of the future without having to be constrained by the supply chain of the past” — Mike Landry, Senior Supply Chain Management Consultant at Genpact

FEBRUARY 2019


29

behind the competition and it is this

of industries and so, it’ll be interest-

space in the middle that companies are

ing to see innovation and competition

striving for. Most companies are look-

coming from places we don’t expect.”

ing to be a fast follower and preparing

“Those that don’t have a fixed infra-

the foundations in order to adopt tech-

structure built on efficiency can really

nologies fast and effectively, without

jump into things and leverage a lot of

the fear of failure and this creates an

infrastructure that’s there ready for

interesting market dynamic. “Some

them to tap into. There’s a whole set

believe that this gives the smaller com-

of infrastructures out there which will

panies an advantage over the bigger

allow new companies to ramp up very

ones,” says Landry. “They don’t have

quickly with not a lot of capital and

the same level of legacy and baggage

implement the supply chain of the fu-

that needs to change. This really kind

ture without having to be constrained

of lowers the barrier to entry for a lot

by the supply chain of the past.” w w w.suppl yc ha i ndi gi ta l. com


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TECHNOLOGY

32

EFFECTIVE SUPPLY CHAIN MANAGEMENT Chris Robertson, UK CEO at Creditsafe, explores how, with Brexit looming and finances becoming ever tighter, supply chain personnel at all levels need to understand how they can manage supply chains more effectively WRITTEN BY

CHRIS ROBERT SON

FEBRUARY 2019


33

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TECHNOLOGY

E

very year, KPIs within a business seem to become tougher and that

affects everyone along the entire

supply chain. Successfully and effectively managing the supply chain proves key.

HIGHLIGHT RISKS BEFORE THEY BECOME PROBLEMS Once a process is set up, it would be foolish to think it can be left to tick along by itself. Therefore, if you have carried out due diligence on a supplier, it doesn’t mean they will be forever creditworthy. 34

Circumstances change, and it is vital to monitor all your suppliers on a regular basis to spot any risks that could threaten your supply chain.

Credit reports for businesses can often point towards a possible problem a good deal of time before they become one. Due to the extensive amount of data collected and used in credit monitoring, you, as a business owner, can do your due diligence to actively understand the landscape you are operating in and continue to have ongoing insight on this. Key decision makers upstream and downstream should be assessing the risk they are involving themselves in by viewing credit history and letting accurate data tell you who to avoid, and who FEBRUARY 2019

“WE NEED TO BETTER ASSESS OUR LIABILITY EXPOSURE IN 2019 REGARDLESS OF WHICH POINT IN THE SUPPLY CHAIN YOU ARE.” — Chris Robertson, CEO, Creditsafe


may require more in-depth research. Algorithms organise our social media feeds, serve us the most accurate search results and feed into credit data analysis tools, too. Businesses should utilise this information to help make informed decisions and can often provide an avenue for discussion regarding new suppliers.

BREXIT AS AN EXTERNAL FACTOR Brexit is coming whether you voted for it or not. Political uncertainty means that exchange rates are fluctuating constantly. To manage your international supply chain more effectively, a tip is to try and acquire fixed rates to keep your cashflow stable and accurate.

The media is often reporting on businesses stockpiling products in fear of the March deadline. Discuss this with your suppliers so you are not caught out if products are in excessively high demand. The Brexit stockpile need not affect your supply chain, but it would be wise to predict that this could increase supplier’s days beyond terms if others don’t manage their own supply chain as effectively as you are. This would mean you don’t have to worry about the next parliamentary meeting affecting your stock management. w w w.suppl yc ha i ndi gi ta l. com

35


TECHNOLOGY

ENSURE KPIS ARE MET AND ANALYSED FREQUENTLY

be a dangerous KPI if scrutinised too

KPIs in any industry are crucial for all

much. The last thing you want to do is

personnel to measure success and

cause pressures on a team of employ-

critique failures. Supply chain KPIs

ees already under large amounts of

shouldn’t be overlooked in 2019 if you

stress. Especially with the likes of Ama-

wish to keep an efficient and effective

zon coming under fire in recent months

journey. With Brexit’s uncertainty and

for its warehouse practices, it’s impor-

economic turmoil affecting the supply

tant we remember the human impact

chain, consider how this may become

of any KPI put in place.

Focusing on warehouse costs can

compounded along your own personal supply requirements.

Whilst every business will have their 36

ASSESS SUPPLIER AND CREDIT INSURANCE NEEDS

own internal KPIs, there are some that

Supplier insurance is there for a reason.

supply chain personnel should con-

There is only a small minority of people

sider for their team. To encourage the

that would not insure their home and

best service possible, first contact res-

goods, your business’ products should

olutions should be one. This helps to

not be considered any differently. We

develop better relationships with sup-

need to better assess our liability

pliers and customers whilst maintaining

exposure in 2019 regardless of which

a professional presentation of your own

point in the supply chain you are. Often

business, too.

in the industry, businesses can fall foul

“2019 COULD BE A TOUGH YEAR FOR MANY WITH INCREASED EXTERNAL PRESSURES. WITH THIS IN MIND. DON’T FORGET TO REMEMBER THE EMPLOYEES AND SUPPLY CHAIN PERSONNEL YOU ARE WORKING WITH ARE ALL HUMAN TOO” — Chris Robertson, CEO, Creditsafe FEBRUARY 2019


CLICK TO WATCH : CREDITSAFE: THE FACTS 37 of ignoring appropriate supplier

external personnel should be consid-

insurance, couple this with a lack of

ered to assist in this role.

financial research regarding potential

Regardless of how you decide to

new suppliers and your issues begin to

ensure your supply chain management

stack exponentially.

is more effective in 2019, ensure you do

If you are using adequate insurance,

your due diligence and assess all risks

don’t just stop there. Businesses need

appropriately. 2019 could be a tough

to be reassessing their policy renewal

year for many with increased external

periods and expiration dates to ensure

pressures, with this in mind, don’t for-

the protection can be sustained through-

get to remember the employees and

out the entire procurement period and

supply chain personnel you are work-

continue to be cost effective. Teams

ing with are all human, too.

should be clued up on this and if they cannot be trusted to maintain these buffers of protection themselves, then w w w.suppl yc ha i ndi gi ta l. com


TECHNOLOGY

38

AI in the manufacturing supply chain Ed Cross, Executive Director, Odesma, explores the true impact of Artificial Intelligence in the supply chain of manufacturing WRITTEN BY

ED CROSS

FEBRUARY 2019


39

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TECHNOLOGY

W

hen it comes to predicting future business trends numerical data has always been king; gathering as much of it as

possible and developing the most sophisticated algorithms to digest it. Artificial Intelligence (AI) has turned this on its head, and instead of being focused on figures, the whole idea revolves around it being trend or word-led. Rather than gathering as much historical data as possible to predict the future, AI can monitor changing trends and habits in real-time to give a more accurate, wider reaching view of what is to come for manufacturers. This includes

40

monitoring what is being said across social media and other print and digital media. In this way, AI is much more reactive to ever-evolving global conversations and can turn this into actionable insights for businesses to develop more intelligent strategies. But this is nothing new; when it comes to AI, manufacturing is much more sophisticated than many other sectors. For an industry challenged by tight margins, it has needed to become very tech savvy to deliver against targets. Many manufacturers are already way down the line with automated processes such as Robotic Process Automation (RPA), which removes the human element from decision-making. Many factories are adopting a ‘lights off’ approach and as a result, are seeing increased levels of FEBRUARY 2019


“Solutions must be developed that support every aspect of manufacturing procurement, from simple back office automation to complex market scanning” — Ed Cross, Executive Director, Odesma

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41


TECHNOLOGY

42

agility and leanness and time-consum-

priorities are creating a changing

ing back office processes are being

mindset, from focusing on the engine

automated, freeing staff up to concen-

of the business to the customer

trate on value-added activities.

experience, resulting in high-value rather than high-volume output.

TACTICAL VS STRATEGIC

Taking this strategic approach

AI and other digital innovations are

means organisations can now concen-

proving invaluable when it comes to

trate on the areas within their supply

the tactical aspects of manufacturing

chain that will deliver the greatest value

procurement, such as matching

such as managing the supply base,

Purchase Order numbers with

cyber security and staffing.

invoices, which in turn is enabling procurement leaders to focus on

MANAGING THE SUPPLY BASE

more strategic activities. These shifting

Arguably the manufacturing landscape


43

has never been more competitive, with

absolutely critical. As an experienced

businesses understanding the need to

procurement leader, you know how

create stand-out products. Identifica-

important traceability, record keeping

tion of and collaboration with new and

and human rights is and now that your

novel suppliers should therefore be a

back office has been automated, your

key focus for the manufacturing

focus now should be on cascading that

procurement leader.

same level of detailing throughout your

However, unless an innovative new supplier knocks on their door, or they are read about online or in a trade

supply chain to ensure they uphold your exacting standards. The challenge with all of this is that,

magazine, then it is as difficult as ever

while you have AI streamlining the

to find them.

tactical side of the business, from a

When it comes to managing reputation, managing the supply chain is

strategic point of view, the technology has simply not caught up. For example, w w w.suppl yc ha i ndi gi ta l. com


TECHNOLOGY

there is currently no technology available that will help monitor supplier reputation, including whether they are engaged in modern day slavery, or to alert you to new suppliers.

CYBER SECURITY While manufacturing procurement is mature when it comes to AI and RPA, its approach to supply chain cyber security is woefully neglected and of great concern. Now that they have moved away from tactical activities, leaders should be ensuring that the level of tech innovation deployed is matched only by 44

the level of cyber security within the organisation and throughout the supply chain. The more connected to the Internet of Things (IoT) a business and its products become, the more exposed they become E X E C U T I V E P R OF IL E

Ed Cross Ed is an executive-level business leader who previously ran the global procurement and HR outsourcing businesses for Xchanging plc. He has over 30 years’ global professional services experience with extensive consulting, outsourcing and functional experience in procurement, supply chain and change management. He previously worked for PriceWaterhouseCoopers and began in a line procurement role with ICL.

FEBRUARY 2019


“Leaders should be ensuring that the level of tech innovation deployed is matched only by the level of cybersecurity within the organisation and throughout the supply chain” — Ed Cross, Executive Director, Odesma

45

and the opportunities for attack they

will try to exploit. Procurement lead-

face. While many have robust internal

ers should be reviewing the security

policies in place for cyber security, the

processes throughout their supply

fact is, it might all be null and void if

chain to ensure every possible point

their suppliers do not share the same

of failure is identified and protected.

level of compliance. Most products have a digital ele-

INHOUSE SKILLS

ment – fridges, washing machines,

While AI and emerging technology

cars; that digital connectivity pre-

continue to enable a shift in focus,

sents new weaknesses that hackers

from the tactical to the strategic, many w w w.suppl yc ha i ndi gi ta l. com


TECHNOLOGY

46

“Identification of and collaboration with new and novel suppliers should be a key focus for the manufacturing procurement leader ” — Ed Cross, Executive Director, Odesma


manufacturers do not have the talent and skills internally to really maximise upon the opportunities presented by them. Although automation is freeing leaders up, do they understand the sheer scope of these technologies and do they have the capability to draw upon and apply them in their new role? Is appointing a chief AI officer to the boardroom one solution?

WHAT NEXT? While technological advances have empowered the higher-volume, tactical aspects of manufacturing procurement, support for the strategic element of business is falling far behind. Solutions must be developed that support every aspect of manufacturing procurement, from simple back office automation to complex market scanning. For the manufacturing industry to realise the full benefits of advanced technologies, including AI, and its application to the supply chain, board members and other key decision makers must make it a priority area for training and upskilling. With increased connection comes increased hackability, it is therefore vital for manufacturers to take the threat of cyber security seriously, both within the business and throughout the supply chain. w w w.suppl yc ha i ndi gi ta l. com

47


T O P 10

48

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procurement professionals Written By

DALE BENTON

Supply Chain Digital ranks the Top 10 procurement professionals in the world, according to the CIPS Procurement Power List 2018

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49


T O P 10

50

Rob Douglas

CPO, Direct Line Group As CPO of Direct Line Group, one of the leading motor, home and small business insurers in the UK, Douglas leads the company’s transformation of its procurement department. He leads a team of 85 procurement professionals that are responsible for an annual spend of £1.5bn. Prior to joining Direct Line in 2016, Douglas was previously a procurement consultant as well as the head of procurement at National Grip, DSG International as well as other roles at Barclays Bank and Capgemini.

www.directlinegroup.com FEBRUARY 2019


51

Paula Davila Martinez CPO, Adidas

The Vice President and CPO of Adidas, one of the world’s leading sports and leisure brands, Martinez joined the company back in 2017 with a vision to transform a decentralised procurement department into a high performing and strategic function. Based at the company’s headquarters in Germany, Martinez is currently building a new operating model in order to create a mature procurement division. She has previously worked in leading procurement roles at UCB Biopharma, The Goodyear Tire and Rubber Company and Anheuser Busch InBev.

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T O P 10

52

Adrian Cook

Director of Fresh Foods, Sainsbury’s Tasked with overseeing Sainsbury’s £10bn Fresh Foods Business, Cook looks at utilising key customer focused outcomes to shape and influence the company’s sales and profit performances as it looks to cement its position as the second largest grocery retailer in the UK. Cook’s career has been one of sales management in a number of industries including FMCG, consulting, construction, support services and defence.

www.j-sainsbury.co.uk FEBRUARY 2019


53

Oliver Cock

Managing Director, Foodbuy Foodbuy is a leading food and food related procurement organisation that spends around ÂŁ1bn each year. Cock played a key role in the creation of Foodbuy back in 2016 following his work with its parent company, and biggest client, Compass Group, as both procurement director and then commercial director. Cock oversees a procurement team of 200 procurement professionals and utilises unrivalled scale and outstanding data analysis that sets it apart from its competitors.

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T O P 10

54

James Cay

CPO, BNY Mellon Cay oversees the procurement function of BNY Mellon, a global investments company that supports clients in managing and servicing their financial assets throughout the investment cycle. Prior to joining the company back in 2013, then as Managing Director, Cay has worked in procurement roles for Barclays, Alliance and Leicester and A.T. Kearney.

www.bnymellon.com FEBRUARY 2019


55

Andrew Cannon-Brookes

Global Head, Supply Chain Management , Standard Chartered Bank Cannon-Brookes joined Standard Chartered Bank back in November 2016, operating in Singapore and reporting to the company’s global head of business efficiency. He is a seasoned procurement and supply chain professional with more than 20 years experience, working for IBM, IBM China and most notably, the UK Ministry of Defence. During his time there, Cannon-Brooks reduced the UK inventory to £32bn and delivered a £1.6bn logistics information services transformation programme.

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T O P 10

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Dhaval Buch CPO, Unilever

Responsible for all procurement across Unilever since 2014, Dhaval Buch successfully led the company’s Asia and Africa Supply Chain functions as Senior Vice President, prior to his current role. During his time there, Buch was responsible for the successful operation and management of 120 factories and a 100+ strong distribution network. As part of his current role, Buch is tasked with creating a responsible supplier network that acts as an “exemplar” of integrity and global best practice.

www.unilever.com FEBRUARY 2019


57

Julia Brown

CPO, Carnival Corporation As CPO of Carnival Corporation & Plc, Julia Brown is in charge of all strategic sourcing and supplier relationship management. Working across the company’s 10 brands, Brown works with leadership teams to solidify the company’s supplier relationships and leverage its $9bn spend. Prior to joining the company, Brown was CPO and Senior Vice President at Kraft Foods in which she was responsible for overseeing a $30+bn sourcing function. She has also worked with Proctor & Gamble, Diageo and Gillette. Brown has also been listed as one of the top 100 Women to Watch by Today’s Chicago Woman and listed in Black Enterprise’s Top 75 Most Powerful Women in Business.

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T O P 10

Annie Brown

Senior Vice President, Global Procurement and Cost Efficiency, InterContinental Hotels Group (IHG) Having first joined IHG back in 1998, Annie Brown become CPO of the company in 2012. Over the following years, her role expanded to cover cost efficiency and in 2016 she was promoted 58

to senior vice president, global procurement and cost efficiency. Prior to IHG, Brown worked for Invicta Leisure, in its time one of the leading golf and leisure companies in the UK, heading up its retail division. Most recently, Brown was invited to become part of the Chartered Institute of Procurement (CIPS).

www.ihgplc.com

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T O P 10

Dapo Ajayi

Vice President, Manufacturing and Technical Operations, Janssen As Vice President of manufacturing and technical operations, as well as being part of supply chain leadership team for The Janssen Pharmaceutical Company, Johnson & Johnson, Dapo Ajayi is a very powerful and influential figure in 60

the procurement space. Through her role she leads the internal and external global manufacturing network, as well as being responsible for the technical operations that champion continuous and transformational growth. Across an experienced career in supply chain and procurement, Ajayi was the CPO for AstraZeneca and has had numerous roles across technical operations, quality assurance and plant management.

www.janssen.com

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EVENTS & A S S O C I AT I O N S

The biggest industry events and conferences WRITTEN BY DALE BENTON from around the world 13–14 MARCH

Temperature Controlled Logistics in Biopharmaceuticals Europe 2019 [ MILAN, ITALY ]

62

04 APRIL

The Temperature Maintenance of

Procurex Ireland

Biopharmaceuticals returns to Milan,

[ RDS, DUBLIN ]

Italy for its 15th Annual edition after an

Procurex Ireland would like to thank all

extremely successful 2018 event. The

partners, sponsors, delegates and

2019 agenda will focus on providing a

exhibitors for their involvement this

holistic approach to temperature-con-

year which has helped make the event

trolled shipments whilst also helping

a success once again. Throughout the

address distributional obstacles and

day hundreds of delegates enjoyed the

regulatory compliance. The event will

free training opportunities and the

examine solutions to mitigate faults

wealth of innovation shown in the Prod-

within the cold chain for a more

uct Showcase. Held in Dublin, Procurex

streamlined and cost-effective supply

Ireland brings together the largest

chain. Both small biotechs and large

annual gathering of pan-sector public

pharma companies alike will be pre-

procurement professionals and market

sent at the ‘perfect platform to share

leading suppliers, from both the Repub-

challenges, network with over 400

lic of Ireland and Northern Ireland, who

industry peers and hear informative

contribute to the ongoing delivery and

case studies from leading pharmaceu-

strategic development of a combined

tical companies.’

annual spend of over €12bn.

Click to visit website

Click to visit website

FEBRUARY 2019


09-10 APRIL

ProcureCon Canada [ TORONTO, CANADA ] A leadership focused event with one shared goal - improving supply chain and procurement strategy across the globe. The Supply Chain Summit serves as an annual platform to

30 APRIL-02 MAY

impact of market dynamics and new

Women in Procurement & Supply Chain 2019

technologies for current and future

[ SYDNEY, AUSTRALIA ]

supply chain and operations leaders.

The annual Women in Procurement and

This year’s event will examine key case

Supply Chain conference is dedicated

studies on how workforce manage-

to advancing the opportunities for

ment, advanced analytics, process

female executives across supply chain

improvement and automation are being

and procurement. Looking to address

rolled out in the world’s best facilities.

specific industry challenges facing pro-

Other key discussions will focus on

curement stakeholders, the event is a

achieving innovation, maximising sup-

platform for procurement stakeholders

ply chain profitability and increasing

to share experiences, insights, stories

visibility and flexibility to mitigate risk.

and best practice-innovations.

Click to visit website

Click to visit website

‘exchange ideas and collaborate on the

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63


EVENTS & A S S O C I AT I O N S

16 MAY

64

World Procurement Awards 2019

20-21 MAY

Total Supply Chain Summit (UK) [ HEYTHROP PARK RESORT, UK ]

[ INTERCONTINENTAL LONDON, THE O2 ]

A highly focused event that brings

Redefining procurement excellence -

together logistics professionals and

the pinnacle of professional

key industry solution providers, the

achievement, each year the greatest

summit consists of one-to-one busi-

procurement organisations and thought

ness meetings, interactive seminars

leaders from around the world gather

and valuable networking opportunities;

for an evening of anticipation, entertain-

in less than two days. The Total Supply

ment, and inspiration at the World

Chain Summit is specifically organised

Procurement Awards. Competing for a

for senior professionals who are

spot on the prestigious list of finalists and

directly responsible for supply chain

winners, organisations are recognised for

within their organisation, and those who

being innovative and transformative

provide the latest and greatest prod-

players in the industry.

ucts and services within the sector.

Click to visit website

Click to visit website

FEBRUARY 2019


65

10-12 JUNE

09-11 JULY

Supply Chain Summit: Atlanta

Procurecon Asia

[ ATLANTA, USA ]

Asia’s premier gathering for global and

The Supply Chain Summit 2019 is the

regional CPOs and Asian heads of pro-

meeting place for the forces of innova-

curement. Procurecon Asia 2019 brings

tion, transformation and connectivity

over 200 attendees and more than 100

that will fundamentally reshape the sup-

CPO’s and Heads of Procurement to

ply chain industry over the coming years.

access and explore interactive case

Over 800 supply chain and procurement

studies, broad discussion on industry

representatives will meet to discuss

challenges and trends and network

digital transformation strategy and look

with some of the biggest names in the

at the supply chain of the future.

procurement space.

Click to visit website

Click to visit website

[ SINGAPORE ]

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66

THE FLOW OF INFORMATION: LSC’S SUPPLY CHAIN TRANSFORMATION WRIT TEN BY

JOHN O’HANLON PRODUCED BY

GLEN WHITE


USA

67

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L S C C O M M U N I C AT I O N S

LSC COMMUNICATIONS IS A VITAL PARTNER TO PUBLISHERS, PRODUCING THEIR PRINTED MATERIALS AND ALSO MANAGING AND DISTRIBUTING THEM THROUGH INNOVATIVE SUPPLY CHAIN SOLUTIONS AND EXCEPTIONAL SERVICE

68

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I

n its present incarnation, LSC Communications is just over two years old having been created out

of the book, magazine, catalogue and office products printing businesses of RR Donnelley. That business was founded in 1864 and became recognized as the founder of the American high quality, high volume book printing industry. Its sought-after Lakeside Classics imprint is now maintained by LSC and is a benchmark for the impeccable attention to product excellence and design that epitomizes the company. Not so long ago, printing was thought to be a dying industry as electronic means of delivering content, whether educational or general, made inroads. Certainly, some impact was felt, however in the last year or two book sales have rallied and LSC’s President of Book Division, Dave McCree, is insistent that the fundamentals of the print market are healthy – a sound basis on which to build the many added value services the company is now able to offer. “Someone suggested to me the other day that we are a 155-year-old startup – I love that! We are a smaller, leaner and more agile organization focused on specific markets.”

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PRI YOU

Link

The time ha HP solution used to ma and engage

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1. Frontier Economic 2. Mark Monitor blog 3. World Federation o 4. Forbes, “Fake Wine 5. Licensed from Dig


INT THAT PROTECTS UR BRAND

k from HP

as come to combat counterfeiting and product diversion—and Link, an affordable n, is up to the task. Link from HP embeds products with an overt or covert digital fingerprint anage your products across their lifecycle. Protect your brand, track and trace products, e consumers with one digitally-printed mark.

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Learn How Link Works


L S C C O M M U N I C AT I O N S

“WE ARE BUILDING THE SERVICES SIDE OF OUR BUSINESS TO COMPLEMENT THE MANUFACTURING SIDE” — Dave McCree, President, Book and Directory Division, LSC Comminications

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AN EVOLVING MARKETPLACE

The traditional core business model

Traditionally, most publishers have

of printers like LSC was to work with

tended to outsource the printing of their

publishers to help them find ways to

books or educational materials but have

reduce costs. Printing was regarded

kept marketing, distribution, warehousing,

as a production cost, to be pared down

order fulfillment and customer relations

wherever possible on the principle

in-house. Some, especially academic

of lean manufacturing. In those days,

presses, even printed their own books.

LSC won business through competitive

This mindset has been slow to change,

pricing, dependable quality and above

but increasingly the household names

all service – now, McCree insists that

in publishing are coming to appreciate

the same attention to the client is being

the advantage of outsourcing more of

extended right through to the supply

their non-core work – and LSC is keen to

chain. Responsibility no longer ends

seize this opportunity. “We have moved

with the finished product but goes right

from an old-style print manufacturer to

through marketing and sales, distribution

what you might call ‘Print Plus’. We are

and cash collection. “We help publishers

to complement the manufacturing side.”

sell more books as well as driving the

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

Dave McCree is the President of the Book & Directory Group at LSC Communications and is responsible for Sales Leadership and strategic relationships within both platforms. Dave has been in the printing industry for close to 30 years with a rich background in leading the print sales and manufacturing divisions. Dave’s focus has been on expanding LSC’s innovative solutions and supply chain management services as well as supporting and promoting the evolving publishing industry.

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L S C C O M M U N I C AT I O N S

cost of their production down. That is

clients include educational giants like

really the focus of our strategy: saving

McGraw-Hill, Pearson, Houghton

cost and creating efficiency along the

Mifflin Harcourt, new edtech players

supply chain at the sales and market-

like Amplify, general publishers such

ing end also helps them to sell more

as Random House and HarperCollins

products. It’s a double winner for the

as well as niche players like Workman

client enabling them to sell more product

Publishing and Abrams. It is also a

while producing it faster through our

major printer of bibles and religious

proven print capability.”

books. “These are all very different

The conversation is no longer about

74

businesses, but they all need both

traditional offset versus digital printing

product and services,” says McCree.

– LSC can handle any volumes in either

“We set out to be more intimate than the

format – but more about e-services,

average large printing organization by

warehousing and fulfillment as well

making sure we are meeting the needs

as supply chain management. LSC’s

of each one of those clients wherever

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

Michael Shea — Senior Vice President, Book Division, LSC Communications — ­ is a seasoned printing and publishing executive with over 20 years of pioneering ventures in content management, custom publishing and book manufacturing. Throughout his career, he has demonstrated the vision and drive to capture high-growth opportunities in the rapidly changing publishing and printing industries. His early successes with technology-driven print solutions led to more comprehensive solutions spanning the entire spectrum of book manufacturing including content management, physical and digital production, distribution and inventory management. His most recent focus has been working with industry supply chain participants to combat book piracy.

FEBRUARY 2019


USA

CLICK TO WATCH : ‘XFROM FILE TO FINAL DESTINATION’ 75 that need might be. They knew we could

that despite the success of e-books,

manufacture a book for them; now we

the case bound books segment grew

are managing their warehousing as

by 6% while e-books declined by 4%.

well, distributing their product from our

While this trend sustains the core printing

warehouses across the USA, and even

capability of LSC, the biggest potential

handling the back-end collection and

lies in innovation: specifically, the

cash applications within their business.”

provision of value-added services that enable publishers to offload the purely

EXPLORING NEW PUBLISHING LANDSCAPES

administrative aspects of book delivery.

Surprisingly perhaps, confirms Books

constrained by a traditional mindset

Division SVP Michael Shea, the fastest-

but today, the benefits of consolidating

growing book sector last year was in

warehousing and order fulfillment are

hardbacks. In 2018, the American

driving change, no doubt stimulated by

Association of Publishers (AAP) reported

the Amazon model. LSC has expanded

Publishers may have previously been

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L S C C O M M U N I C AT I O N S

“WE ARE COMMITTED TO HELP PROTECT OUR CLIENTS’ INTELLECTUAL PROPERTY AND TO SUPPORT TECHNOLOGY INNOVATION WITHIN THE SUPPLY CHAIN” — Mike Shea, Senior Vice President, Book and Directory Division, LSC Comminications

76

its warehousing capacity to meet this demand and now has a spread of

the world’s leading publishing houses. Educational technology, or edtech, is

facilities over the Midwest and East

a fast-expanding and very fluid area of

Coast. The LSC book fulfillment

content delivery, explains Shea. “There

footprint now totals more than 3.7 million

are hundreds of new and disruptive

sq. ft. of operating space, serving clients

startups, attracting billions of dollars

in all of its market sectors. Most recently,

in investment, challenging established

LSC has acquired Elsevier’s warehous-

players like Amazon, Apple, Google

ing and distribution facility in Missouri

and Microsoft.” These companies are

to strengthen its full range of supply

seizing on technologies like virtual

chain services for publishers of both

reality (VR), artificial intelligence (AI) and

printed and electronic books. It’s a great

audio-visual (AV) tools delivered using

demonstration of the new service model,

cloud technology – but while this has

says McCree, in partnership with one of

disrupted print, it hasn’t replaced it.

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USA

77

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

Brittyne Lewis — Product Development Director, LSC Publisher Services, LSC Communications — has worked directly with global publishers in various capacities at LSC Communications over the past 10 years. She has a diverse background in managing software and relationships with major retailers and publishers. In her role as Director of Product Development, Brittyne drives the development and strategy of new products and solutions to meet publishers’ needs by anticipating market requirements, working directly with publishers, and monitoring the industry trends. Apart from work, Brittyne enjoys spending time with her family, gardening, reading books to her children, and eating tacos and BBQ in Austin, Texas. w w w.suppl yc ha i ndi gi ta l. com


L S C C O M M U N I C AT I O N S

“We found there wasn’t the network infrastructure to support all this digital delivery. There was an ongoing request and requirement for printed material – as the digital curriculum develops it is supplemented with print, and the print component has continued to grow pretty dramatically. We are working with the most advanced clients and publishers in that space, at the school and college level, including the providers of open educational resource (OER) material such as California State University’s MERLOT project, which publish low-cost printed books to 78

supplement online content,” Shea adds. OpenStax, a nonprofit edtech initiative based at Rice University makes textbooks available in free digital formats and at a low cost in print. LSC prints a significant number of these core textbooks, mostly at the freshman and sophomore level, which sell at a fraction of the cost of the mainstream equivalents. “OpenStax has really changed the economics of making printed material available to students,” he explains. All of these initiatives benefit from LSC’s unrivaled digital print capacity. Even more importantly though, the very complexity and immediacy they have brought to the University Press underlines the need for the comprehensive service platform the company

FEBRUARY 2019


USA

has developed to manage the logistics and fulfillment aspects of the entire supply chain.

PARTNERSHIP IN TECHNOLOGY Brittyne Lewis, who looks after side of the business that deals with metadata, audio, artificial intelligence, retail data tracking, and digital technologies, was keen to explain the ways in which technology has disrupted the information market. “Every year something new comes up whether it’s from publishers’ prospectuses, how Amazon, Google and Apple are operating or new data being available,” says Lewis. “Data presents a big challenge. The retail industry, for example, has been able to capture a lot of customer data, but in the publishing space that hasn’t really happened to the same extent – yet. So I’d say we aim to help publishers to navigate the digital landscape.” To make this possible LSC is exploring and growing every opportunity. In the summer of 2018, it took the first step and investing in an AI tech start-up focused on the publishing and media industry, with an eye towards providing target audience data to drive marketing strategies. LSC has also developed a publisherfacing platform called HarvestView designed to increase book discoverability and help

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L S C C O M M U N I C AT I O N S

optimize books for sale online. This is key to publishers’ success both on Amazon and other e-tailers given the multitude of brick-and-mortar closures over the years. It will strengthen LSC’s leadership position in content logistics, distribution and monetization across all formats, channels and platforms. LSC has morphed into a solutions provider, Lewis continues. No longer simply the output partner for a printed book, it now provides tools that enable strategy formulation and efficiencies in 80

the supply chain. A good example would be the multi-year supply chain services agreement it signed in December 2018 with the United Church of Canada, under

delivering a platform for verifying

which it will provide a range of distribu-

textbook authenticity through the

tion services from LSC’s Newmarket,

scanning of secure unique identifier

Ontario location.

codes. The platform uses HP’s tried and tested Link Technology for

NIMBLE, AGILE – AND DEPENDABLE

product authentication to help protect

Michael Shea is determined that LSC

intellectual property and fight counter-

will continue to leverage best-of-breed

feiting throughout the entire supply

technology solutions to serve its clients.

chain. Publishers can apply an

To address the age-old problem of

IntercepTag serialized mark, a unique

piracy in global textbook publishing,

anti-piracy identifier code, on each book

the company worked with a long-stand-

at the time of production via a label or

ing partner in print and in July 2017

digitally printed cover. “It’s a tangible

LSC launched its IntercepTag solution,

demonstration of our robust Supply

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USA

$3.6bn Approximate revenue (2017)

2016

Year founded

23,000

Approximate number of employees 81

Chain as a Service (SCaaS) offering,”

as a printer. I don’t want to under-empha-

emphasizes McCree. “We are committed

size that. It is an important aspect of

to helping protect our clients’ intellec-

who we are and it is a critically important

tual property and to support technology

business that is growing strongly again

innovation within the supply chain.

after a flat period. That said, we are

As we look to roll out Phase II of our

looking at an incredibly exciting time over

IntercepTag solution, we will now be

the coming years. By capturing more

looking to help our clients link directly

and more of the supply chain services,

with their end customers, the consumers.”

fulfillment, distribution and warehous-

He summarizes his position with

ing side of our clients’ businesses, they

a powerful statement of the strategy that

can focus on their core business of

will define LSC in the digital age. “When

content creation, editorial and sales that

people think of LSC, and specifically

will only create more opportunities for

the LSC book business, they think of us

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L S C C O M M U N I C AT I O N S

“WE AIM TO HELP PUBLISHERS TO NAVIGATE THE DIGITAL LANDSCAPE” — Brittyne Lewis, Technology Executive, Book and Directory Division, LSC Comminications

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they attempt to utilize Amazon and other e-marketplaces. “The new entrants to publishing and the technology marketplace that we have been talking about only add to that excitement. Printing has certainly changed, and we are leading that change. There’s a significant change, with a move from long runs and putting stock into a warehouse to more dynamic, agile digital print. We see it as an inventory-on-demand scenario, which is a really good fit with our business. After all, we already have one of the largest digital print capability in the marketplace.� Thus, LSC retains its commanding position in the market as a dependable printer that anyone with a printed product needs to be talking to, while evolving into a very significant service partner, helping publishers around the world with whatever they need to get their product to market and into the hands of the end customer.

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PROCUREMENT TRANSFORMATION IN THE HEART OF PHILADELPHIA WRIT TEN BY

ANDRE W WOODS PRODUCED BY

DENITR A PRICE

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DREXEL UNIVERSITY

WE SPEAK TO ASSISTANT VICE PRESIDENT OF PROCUREMENT SERVICES JULIE ANN JONES REGARDING DREXEL UNIVERSITY’S PROCUREMENT TRANSFORMATION

P

rocurement is undergoing nothing short of a revolution right now, with technology transforming both

operations and capabilities far beyond merely 86

a back-office function. Purchasing goods and services strategically with an emphasis on value and cost savings has become a staple of modern business practice, and higher education is not exempt from this trend. Rising tuition costs and changes in enrollment patterns to more affordable options have caused budgets to tighten, leading to mergers and even closures among some smaller, private educational institutions. In this environment, colleges and universities are re-evaluating their purchasing policies and procedures in order to maximize the student tuition dollar, reduce expenses, and remain competitive. Drexel University, located in Philadelphia, Pennsylvania, is one such institution, having

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DREXEL UNIVERSITY

“W E TRY OUR BEST TO PARTNER WITH DEPARTMENTS TO MAKE SURE THEY’RE GETTING THE BEST VALUE” — Julie Ann Jones, Assistant Vice President Procurement Services


USA

89 recently expanded its Procurement

involves an annual spend of approxi-

Services department under new

mately $350mn across a diverse range

leadership. Julie Ann Jones joined

of departments, and transitioning this

Drexel, the 15th largest private university

function through the prism of social

in the US, last January as Assistant

responsibility and economic inclusion

Vice President of Procurement Services.

is no small undertaking. However, Jones

What brought Jones to Drexel was the

has the necessary experience in spades

opportunity to build a procurement

– having engaged with suppliers during

department at a university that has the

her seven years working in IT and on

institutional will to make meaningful

supply chain systems at Philadelphia

change to the way it does business,

Housing Authority and while serving

including the development of a more

as Executive Director, Project Manage-

socially responsible and economically

ment & Procurement at La Salle University.

inclusive procurement strategy. The procurement space at Drexel

In effecting this institutional change, Jones placed a premium on pragmatism w w w.suppl yc ha i ndi gi ta l. com


DREXEL UNIVERSITY

and flexibility while still being mindful of her team’s core mission. “A lot of the changes in procurement have happened pretty fast,” she explains. “We had to begin to transition into new, creative ways of thinking. And with that kind of culture shift come policy and process updates.” Understanding the needs of Drexel meant not strictly adhering to a best price model. Instead, Jones reshifted the focus of the procurement function to what she calls ‘best value’. “We have to be budget conscious, of course, but sometimes you might also have to pay a little bit 90

more because the product or the service that you need is really represented better at a slightly higher price,” she explains. “We want to provide a quality service and get real results.”

SUPPLIER DIVERSITY AND ECONOMIC INCLUSION A key dynamic in instituting policy and process changes was Drexel University’s commitment to working alongside the local community. “It’s relationship building, essentially. Procurement’s not just an administrative function but also a customer service function while also being very strategic,” Jones explains. The university is a key member of Philadelphia Anchors for Growth and Equity (PAGE), FEBRUARY 2019


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

Julie Ann Jones is a Project Management and Procurement Strategist who partners with executives, cross-divisional teams, and external entities to strategically source and manage contractual engagements to the financial and product benefit of her sponsor. Julie has a history of transforming daily cross-functional operations through the development of innovative systems and enterprise architectures for organizations in diverse industries. She has significant strength in building, training and leading dynamic teams, inspiring ingenuity, creativity, accountability, and morale. Julie is currently serving as the Assistant Vice President of Procurement Services at Drexel University, where she oversees the University’s significant spend portfolio.

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92

which works to better connect large

universities within the city of Philadelphia.

institutional buyers to local suppliers and

The initiative is also hoping to create

their respective supply chains across

5,000 living wage jobs for local residents

what are termed the ‘eds and meds’

over the next 8-10 years. “The idea is that

– educational and medical institutions

we all come to the table to share data and

across the city. It’s a ‘buy-local’ program

strategies. We get really deliberate about

close to Jones’ heart; her late father was

this work to see if we can bring some of

a small business owner.

the spend dollars back into Philadelphia,”

The initial aim of the scheme is to

she explains. “Baltimore had a really

localize $500mn in goods and services

successful initiative and we’ve been

contracts across 13 city hospitals and

working closely with the team that heads

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93

that up. I sat on the panel in October,

to truly help manage that aspect of any

and we had some really great conversa-

of these larger contracts and hold these

tions about how to do this work and how

suppliers accountable to it. We can then

to make it mean something. So, it’s an

see what that process looks like on a

interesting time.”

quarterly basis and how we quantify

Local suppliers are benefiting from an

and report that when we look at our

overarching supplier diversity program

diversity numbers,” Jones outlines. The

that plays a huge part in the new drive

Smart Source procurement system

at Drexel, with a dedicated Director of

at Drexel is also being utilized more

Supplier Diversity appointed last August.

rigorously to support the university’s

“We have the capacity on our team now

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DREXEL UNIVERSITY

Jones is fully invested in the local

94

“So, a lot of these programs have

and diverse economic impact of both

different goals. You have the commu-

the university and its partners. “We’re

nity partnership folks that are on the

not just checking boxes to make sure

relationship side of things, out in the

we’re hitting certain arbitrary goals or

community, hearing the problems. Then

numbers but focusing on how we are

there’s the business side of the house,

really impacting these businesses in

which I would consider to be procure-

our community. Are the businesses

ment, facilities and HR and now we’re

prepared? Do they have the capacity

starting to engage with our internal folks

to do business with the larger institu-

as well as with our external neighbor-

tions? And if they don’t, can we give

hoods. So, a big focus since the director

them smaller pieces, or can we put them

got in has been inserting ourselves into

in contact with people to help build their

these processes, into the community,

capacity so they’re ready next time?

into these conversations, talking about

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CLICK TO WATCH : ‘AMBITION CAN’T WAIT. DREXEL UNIVERSITY.’ 95 how we affect all this, not just through direct purchase, but through other strategic things we can do.” Sustainability continues to influence many aspects of business strategy across numerous departments and it’s an influence behind the future of procurement at Drexel. “Sustainability is that last tier. Some of our partners already report in on it, but that’s the next pillar we’ll focus on. The Director (of Supplier Diversity) and I have spent a significant amount of time talking about what this program’s going to look like and how we’re going to engage in a very different and deliberate way.” w w w.suppl yc ha i ndi gi ta l. com


DREXEL UNIVERSITY

TEAM BUILDING To bring in the processes Jones saw as essential to Drexel’s strategy, adding headcount to the small existing team was a critical priority. Fortunately, Jones had both the support of Drexel and the ability to hire the majority of her now fully-staffed department while retaining existing talent. “The seat here at Drexel had been empty for about a year and several open positions on the team were deliberately left until my position was filled,” she says. “We’re 17 strong right now but of that 17 only four have been here 96

longer than 11 months. It’s a really young team, and of the folks we interviewed, hired and brought in, none came from higher education; not by design, just by the pool of candidates and their skillset and what they brought to the table. Having them come in fresh to higher education has actually been a gift because it’s all changing so fast, they get to be on the ground floor as we create this.” Jones introduced what she describes as a ‘think-tank environment’. “It’s working very well,” she enthuses. “I’m already getting a lot of positive feedback which I am extremely happy with. The last thing you want, especially when you’re trying to build a new team, is to have somebody coming in thinking they know exactly how to do it. Higher education culture FEBRUARY 2019


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is very unique in and of itself, and each institution will be very different to the next. So, what you think you know really doesn’t matter when you go to a new university.” The procurement system Jones inherited at Drexel was a procure to pay (P2P) system implemented back in 2014. However, the legacy system was not yet being fully utilized, which is not entirely uncommon. “We have a pretty robust system, and now we’re truly engaged in catching up with some of the maintenance items that make it a lot more user friendly. We’re also looking at how to most effectively capture data.” Jones’ goal for this year – “and we’re certainly on track to do that” – has been data scrubbing. “We’ve been standardizing our reporting, trying to be consistent and repeatable in the information and the data we share internally to make decisions, but also externally to be able to represent ourselves as a significant anchor institution in Philadelphia, which we are.” A key outcome of robust data capture is the ability to centralize pricing negotiations with suppliers where the university’s expenditures cut across multiple departments. “I’m very sensitive to the fact that we can make a big impact on those smaller departments, and they mean just as much to me as the w w w.suppl yc ha i ndi gi ta l. com

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DREXEL UNIVERSITY

15

Colleges and schools

1891

Year founded

98

24,190

Approximate number of students

university holistically, so I don’t always

help them run their own bids. Higher

want to talk about the university’s bottom

education procurement is generally

line.” Jones has just four strategic

pretty decentralized and we’re attempt-

sourcing specialists and one director

ing to restructure that a little bit and

able to facilitate RFPs across approxi-

offer some solutions university wide via

mately $350mn of spend. “We’re not

website portals and internal communica-

going to be able to facilitate every RFP,

tion, so these departments can benefit

but we try our best to partner with the

from the entire university spend.”

departments to make sure they’re

Jones sees procurement continuing

getting the best value, and then for the

to shift both at Drexel and in the wider

smaller ones we try to give guidance to

business community, as it transforms

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99

into a strategic function on a global scale.

whether it’s by budget savings or

“We’re really going to see it (procurement)

aggressive partnerships. Some of our

continue to move forward as a strategic

partnerships actually do result in money

business partner. I think we’re going to

coming back in to the university, and

see a lot of our executive level folks

into whatever entity you’re speaking of.”

turning to procurement with questions,

The procurement space at Drexel is

strategic partnerships and initiatives,

undergoing a massive recalibration

and asking us to be at those tables to

and eventually Jones wants to be able

come up with ideas and brainstorm with

to provide an annual report for pro-

them. Procurement is going to continue

curement at Drexel incorporating all its

to become more of a financial resource,

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DREXEL UNIVERSITY

“H IGHER EDUCATION PROCUREMENT IS GENERALLY PRETTY DECENTRALIZED AND WE’RE ATTEMPTING TO RESTRUCTURE THAT A LITTLE BIT AND OFFER SOME SOLUTIONS UNIVERSITY WIDE” 100

— Julie Ann Jones, Assistant Vice President Procurement Services

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as the university continues to nurture its clients as well as the local citizens and businesses of Philadelphia. “We want to talk about all the wonderful things that we do,” Jones says. “We want to highlight the extracurricular aspects of procurement and what we’ve participated in and how we’ve been impactful, not just financially, but also socially and civically within our community.” Year after year, Drexel’s Procurement department continues to make meaningful changes in its business model while exchanging value with the community to become a leading benchmark to other universities. Jones is proud to have demonstrated this and with a strong team and commitment to sustainability, this progress is set to continue.

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Warehouse benchmarking study is a top tool for measuring performance WRIT TEN BY

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WA R E H O U S I N G E D U C AT I O N A N D R E S E A R C H C O U N C I L

THE EXPLOSIVE GROWTH OF E-COMMERCE IS MAKING IT HARDER AND HARDER FOR DISTRIBUTION MANAGER TO PROVIDE EFFICIENT AND TIMELY PROCESSING, HANDLING, FULFILLMENT AND DELIVERY OF ORDERS

A 104

September 2018 CBRE report projects that U.S. warehouses will need 452,000 more workers this year and next to

handle soaring volumes of e-commerce shipments. Meanwhile, online buyers’ expectations for fast, low-cost, perfect service are raising the competitive bar. The need to measure performance both internally and against other companies will only grow. This reality makes an annual benchmarking study conducted by the Warehousing Education and Research Council (WERC) all the more valuable. Now in its 15th year, the “DC Measures” study polls warehouses and DCs on their performance on 35 operational metrics, or key performance indicators (KPIs). The metrics are grouped into five sets: customer, operational, financial, capacity/quality, and employee/labor. The study aims to identify which metrics are important to warehousing professionals as well FEBRUARY 2019


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Nimble. You need to learn fast, stay lean and be gutsy to remain competitive in this brave new world. WERC has an unrivalled education program. We’ve got an in-depth online training, live webinars and self-guided learning choices to fit every schedule. Our annual conference offers exceptional peer-driven learning opportunities. You won’t find better education anywhere. werc.org

Better Everywhere.


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as how performance against KPIs

detailed report and at WERC’s annual

changes over time, according to re-

conference. (The 2019 conference will

searchers Dr. Karl Manrodt of Georgia

be held in Columbus, Ohio, April 28 –

College & State University, Dr. Donnie

May 1. For more information, click here.)

Williams of the University of Arkansas,

The primary report looks at perfor-

and WERC researcher and founder of

mance metrics for all respondents.

the consulting firm TSquared Logis-

Those statistics are broken out into

tics Joseph Tillman. It also provides

five classifications: “best-in-class,”

benchmarks that managers can use to

“advantage,” “typical,” “disadvantage,”

evaluate their performance on every-

and “major opportunity,” allowing

thing from order-picking accuracy to

managers to see where their own

capacity utilization, among many other

facilities sit on the spectrum. (The

metrics. The survey goes out to WERC

median is also included in the report

members and readers of study co-

but is not assessed.) They also have

sponsor DC Velocity magazine every

the option of purchasing an interac-

January; the results are presented in a

tive “comparison report” that lets them

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

Joe Tillman Joe Tillman is the founder of TSquared Logistics and a WERC Researcher. Joe has a keen interest in all things supply chain and uses his high-energy approach to life to author articles for industry publications, and speak to supply chain industry groups. He co-leads the Warehousing Education and Research Council’s inf luential annual benchmarking study, “DC Measures.” Joe has over 15 years experience in inventory management, hazardous materials training, transportation, and warehousing.

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1977

Year founded

1,700+

Approximate number of employees

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

Donnie Williams Dr. Williams teaches Master’s students to think critically and strategically about Logistics Management and how the Supply Chain must be integrated in order to gain competitive advantages in today’s global marketplace. Dr. Williams teaches undergraduates the principles of Operations Management and Supply Chain Management, and works to help them discover the career in business that they will flourish in.

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deep dive into the findings to uncover trends and explore whether they have an impact on warehouse performance. They sometimes turn up surprises. For example, this year, five of the top 10 performance metrics respondents said they use most often were related to labor. Just two years ago, four of those (contract employees as a percentage of total workforce; overtime hours as a percentage of total hours; part-time workforce to total workforce; and percentage of employees who are cross-trained) were ranked at the bottom of respondents’ lists. Another surprise: Adoption rates for some efficiency-enhancing technologies has not grown as much as expected. For example, only 65 measure their own performance on

percent of respondents are currently

KPIs to that of respondents within the

using a warehouse management

same demographic, based on industry,

system (WMS), a long-established

type of customer served, type of picking

technology that’s generally consid-

operation, and other factors. “This will

ered to be a “must have.” Moreover,

help to answer questions like where

there was no statistically significant

should we make improvements, and

difference in performance between

what specific activities should we be

companies with and without a WMS.

looking at” in order to make those

In the team’s estimation, this prob-

improvements, Tillman explains.

ably reflects current users’ failure to

The research team also takes a

fully utilize the software’s capabilities, w w w.suppl yc ha i ndi gi ta l. com

109


WA R E H O U S I N G E D U C AT I O N A N D R E S E A R C H C O U N C I L

or possibly that they are overlaying

to reflect warehouse professionals’

the WMS on a manual system. There

current concerns. “At the heart of the

was, however, a correlation between

research is a conversation between

newer technologies and better perfor-

warehousing professionals and the

mance on relevant KPIs. “For exam-

researchers. We want to answer ques-

ple, if you’re looking at internal order

tions that are relevant and provide real

cycle time, then RFID helps. If you’re

benefits to the industry,” Manrodt says.

looking at on-time receipt and puta-

Warehouse and DC professionals

way, then a pick-to light system might

can get in on that conversation by at-

have an impact there,” Williams says.

tending a webcast of the DC Measures

The “DC Measures” study is any-

Study on January 10, 2019; WERC will

thing but static. Research questions

open the survey in January and those

and topics change from year to year

who take part will get a copy of the final

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

Karl Manrodt Dr. Manrodt serves as a Professor of Logistics at Georgia College & State University, located in Milledgeville, Georgia. He is also the Director of the Master of Logistics and Supply Chain Management program, an on-line master’s program for working professionals. His degrees include a B.A. in Philosophy and Psychology, Wartburg College, M.S. in Logistics, Wright State University, and his Ph.D. at the University of Tennessee. Dr. Manrodt also had served the profession in several forums. He served on the Board of Directors for the Council of Supply Chain Management Professionals as well as other leadership roles with WERC.

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CLICK TO WATCH : WERC’S ANNUAL CONFERENCE 2019

“At the heart of the research is a conversation between warehousing professionals and the researchers. We want to answer questions that are relevant and provide real benefits to the industry”

report. It also pay to attend WERC’s 42nd Annual Conference for Logistics Professionals, April 28 – May 1, 2019, in Columbus, Ohio. In addition to a presentation on the 2019 “DC Measures” study, the conference will include educational sessions, facility tours, networking opportunities, and the WERC Solutions Center exhibition. For more information, go to: www.werc.org/2019

— Karl Manrodt, Professor of Logistics

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ACCENT GROUP 112

A SUPPLY CHAIN TRANSFORMATION Accent Group LTD boasted record profits last year and moved 6.3 million shoes — that’s one in five in Australia – thanks to its recent supply chain transformation. Tim Greenstein, General Manager Supply Chain & Technology and Supply Chain Manager, Mark Rizza, reveal the secrets behind their omni channel strategy

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WRITTEN BY

NIKI WALDEGRAVE PRODUCED BY

GLEN WHITE

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A C C E N T G R O U P LT D

G

one are the days of successful retailers surviving on bricks and mortar alone. To be at the forefront

of retail now, businesses need a booming digital presence. Accent Group Ltd – formerly RCG Corporation Ltd – is on the ASX and delivered its FY18 results in August, revealing a record underlying net profit after tax of $47.1 million, up 17.9% on the prior year. The business – which has more than 460 stores across Australia and New Zealand – has delivered 114

strong returns over the past five years through its brands including The Athlete’s Foot, Platypus, Hype DC, Timberland, Vans, Dr. Martens, Saucony, Merrell, Palladium, Sperry Top-Sider, Stance, Supra, Subtype, and kids’ funky online brand The Trybe. Its recent success is thanks to a major collaboration across many business units involving a stunning digital transformation over the past 24 months, which involved a one key stream full supply chain transformation led by Tim Greenstein, General Manager Supply Chain and Technology, and Supply Chain Manager Mark Rizza.

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“We want to make sure we’re the best retailers out there. Our CEO always says we don’t do average”

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— Tim Greenstein, General Manager Supply Chain & Technology

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CLICK TO WATCH : ‘ADOBE EXPERIENCE : CUSTOMER SHOWCASE – MARK TEPERSON, CHIEF DIGITAL OFFICER, ACCENT GROUP LTD 116

“The rate at which business rolls out projects is really not matched anywhere else that I’ve seen in my time” — Tim Greenstein, General Manager Supply Chain & Technology

FEBRUARY 2019

“Our digital team led by Mark Teperson, our Chief Digital Officer, in conjunction with our technology team have effectively enabled 13 websites for the business in the last three years,” Greenstein reveals. “In terms of the space that we play in – athletic leisure footwear and general footwear – we’re fortunate that that space has been growing and we’ve been able to open up more stores across Australia and New Zealand, which has also contributed dramatically to our growth. “But so has listening to our customers.”


ANZ

Online sales are growing fast –

that to give it a bit of context, our

Accent’s FY18 digital sales are up 131%

business tradition started as a whole-

on FY17 and up c88%YTD in FY19

sale business and over the last decade

– with approximately 40 to 50 per cent

or so has ramped up its retail presence.

of online sales now coming directly

“As that footprint has got bigger, having

from the stores, of which the majority

more stores and hitting the market with

are omni-enabled. New functionalities

these technological capabilities is

including ‘click and collect’, ‘ship from

allowing the business to leverage its

store’, same day delivery and endless

460-store network to drive growth

aisle, are all now enabled

with a true omni channel strategy.

“We initially projected at 20 or 30%,

“We’ve also enabled new warehousing

so you can imagine the overflow of that,

capability which again, using state-

and what that means in store land…”

of-the-art automation at our new Toll

adds Rizza. “Adding another layer to

operated Preston facility in Sydney, will

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

Tim Greenstein is the General Manager of Supply Chain and Technology at Accent Group Ltd — Australia’s largest footwear retailer with over 445 stores across Australia and New Zealand. Tim has extensive experience in a variety of retail disciplines, focused on Supply Chain, Technology and Ecommerce. Tim has developed a reputation as a change agent, leading several key high-profile change and strategic projects at Accent group through working with the business to deliver transformative change across The Athlete’s Foot, Hype DC, Platypus Shoes, Skechers, Vans, Merrell, Timberland, CAT, Saucony and Sperry. Tim holds a Bachelor of Commerce and is a Director of a not for profit board.

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

Mark Rizza is head of Supply Chain for the Accent Group Limited. Mark is responsible for procurement, international and local logistics as well Customer Care for Brands such as Platypus, Hype DC, Vans, Skechers, Dr Martens and Timberland. Mark has 15+ years of experience in this space and has worked for both local and global retail brands in an executive capacity such as Lululemon Athletica and Bras’n’Things. Mark is highly experienced in transformational projects using his passion for people an approach of simplifying complex issues to deliver what is best for consumers. Mark has completed his MBA through the Australian Institute of Business.

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“You have to have web and ERP platforms that are capable of handling complex integrations these days”

119

help us handle the business growth, increase volume and improve speed to market requirements, which ultimately advances the service to consumers.” Accent recently constructed a purpose-built digital hub of excellence in Melbourne, which concentrates the digital expertise under one roof. There’s not one all singing, all dancing system these days in a big business that handles things end to end, and so Accent has utilised its current providers, as well as new providers to

— Tim Greenstein, General Manager Supply Chain & Technology

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With Smart Omichannel Order Management

fluentcommerce.com

info@fluentcommerce.com


The Athlete’s Foot —

As fast as their customers with Fluent Commerce Fluent Commerce is an Australian software company, headquartered in Sydney. They offer smart omnichannel order management allowing retailers to be easier, faster and more convenient to shop with than their competitors. It means fulfilling orders in the most cost effective and quickest way possible whilst offering the customer as many delivery and pick up options as possible. Accent Group wanted to create a single, streamlined technology stack in their transition from multi- to omnichannel customer engagement. Fluent Commerce was chosen for their order management requirements as this allowed them to turn their stores into mini distribution centres, enabling click and collect and ship-from-store.

Digital sales increased by 170% in the first six months of implementing ship-from-store. The Athlete’s Foot now operates seamlessly across channels, its digital arm an extension of the store network. Through Fluent Commerce, they are also able to access real-time inventory throughout the entire operation. This opens up all available stock to all consumers no matter where they are and which channel they choose to shop on; not just the stock available in the warehouse. The Athlete’s Foot are making out-of-stock situations a thing of the past.

Taking things further, ship-from-store capabilities also ensures that Athlete's Foot can implement an endless aisle strategy, allowing in-store associates to ship out-ofstock items directly to the customer from another store the following day. This means breaking the pattern of discounting stock that doesn't sell in a particular store or losing sales altogether, by redistributing stock according to customer demand and location.

fluentcommerce.com


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“Fluent Commerce is used for The Athlete’s Foot to manage click & collect fulfillment with their in-store technology” — Tim Greenstein, General Manager Supply Chain & Technology

123

enable its omnichannel strategy. The

for orders to be taken online and sent

websites’ eCommerce platform is

to different stores or warehouses for

Magento and Accent uses three key

fulfilment, in a particular and ideally

enterprise resource planning (ERP)

seamless way, in particular sequences,

systems – Apparel 21 , Erplyand Pronto

based on certain rules that the business

across its group of stores.

requires in terms of being effective.

“You have to have web and ERP

“Another key system aspect, certainly

platforms that are capable of handling

for our store enablement, was the ability

complex integrations these days,”

to effectively use third party software

explains Greenstein. “From our core

(middleware) providing us with intelli-

systems, we needed to facilitate that.

gent shipping and fulfilment solutions

The technology must enable the ability

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A C C E N T G R O U P LT D

C OMPA N Y FA C T S

• Accent Group LTD has more than 446 stores across Australia and New Zealand • In 2017/18 total digital sales grew by 13% • Accent Group has delivered strong returns over the past 5 years • Accent is on the ASX, and its total shareholder return over the past 5 years is 177% • It has 13 new websites across Australia and NZ, with two launching next year • Omnichannel sales are on track to reach 15% target of total sales within two years • Accent’s online sales are growing fast — 131 per cent in 2017 124

• Approximately 40 to 50 per cent of online sales now come directly from the stores, of which the majority are omni-enabled • Customer care is front of mind going into 2019 • 24/7 coverage will include across live chat and email • Live chat launched in October across Vans, Skechers, Timberlands, Doc Martens and Platypus, with Hype DC and The Athlete’s Foot coming soon • In the past 12 months, 3.5million customers registered through its various loyalty programs • Platypus launched same day delivery service in July 2018, more will be rolled out 2019 •Accent has hubs in Melbourne, Sydney and Manila • In just the last two months, Accent secured the rights to the Supra brand and launched kids online brand, The Trybe

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and dispatch flow, particularly from our store network.” The middleware, in Accent’s case, have three applications, given the numerous business divisions – Temando, Fluent Commerce and Shippit – which allow for distributed order management at stores, as well as integrations with numerous freight providers to produce the freight labels and support the multi option freight requirements to make the store process more seamless. Fluent Commerce is used for The Athlete’s Foot to manage click & collect fulfillment with their in-store technology. Its successful next day and same day delivery services is due to its existing relationships with Australia Post’s StarTrack Courier and Direct Courier. Being one of the first businesses to roll this capability out nationally across all stores, Accent hopes to ensure its delivery capability is never far from the customer and will safeguard it from online competitors such as Amazon, which recently launched in Australia. “Interestingly, some of these purely online players are starting to play around with the physical stores,” muses Rizza. “Many Pure online players have or are w w w.suppl yc ha i ndi gi ta l. com

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A C C E N T G R O U P LT D

“We’ll never lose focus on our roots here in Australia” — Tim Greenstein, General Manager Supply Chain & Technology

126 contemplating a physical store presence, with Catch of the Day launching a pop-up recently. “We’ll look to cover everywhere, and because we’re utilising our store footprint to assist in the fulfilment process, our aim of faster delivery nationwide will be greatly assisted by this capability. “We have a really good opportunity, given our current enabled capability across stores and digital, at solidifying, growing this further and continuing to build on our digital and store strategy, so that we can stay at the forefront of the marketplace.” FEBRUARY 2019


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Customer care is also front of mind going in 2019, with 24/7 coverage, including across live chat and email. Live chat launched in October 2018 across Vans, Skechers, Timberland, Doc Martens, Platypus, Hype DC with The Athlete’s Foot coming soon. “Two and half years ago, we had one team member that looked after retail and ecommerce,” laughs Rizza. “Now, we have more than 25 people based at the hubs in Melbourne, Sydney and Manila, and that’s only going to get bigger. It’s driven by consumers demanding out attention and demanding increased support, and also our stores’ demands for support. “We started live chat with some of the smaller brands and in a short space of time it’s taken off quickly. To put in perspective, over the last few weeks, it went from being a few tickets to now being nearly a quarter of overall volume through the chat channel, and that’s with us currently really only covering business hours, so we know for a fact that consumers want to talk to us.” Obviously, such a digital transformation has been a huge culture change in the business, with the technological w w w.suppl yc ha i ndi gi ta l. com

127


“Our digital transformation strategy included Temando, a multi-carrier shipping solution that supports our vision to provide our customers with a great way to submit returns online –– helping us deliver consistent customer experience no matter how busy it gets.” — Tim Greenstein, General Manager Supply Chain & Technology

Find out more: bit.ly/DemoTemando Temando, a Neopost Shipping company


ANZ

improvements putting increased onus onto the store teams, and what their day to day roles look like. In some cases, staff have

“Part of the learning for us is that we’ve created roles that we didn’t expect to create,” says Greenstein. “We had a view of how

gone from being purely

some of the requirements,

salespeople to having to

monitoring procedures

manage order fulfil-

and some of the

ments, and the group

operational processes

ensures that with every innovation that’s rolled out and executed, full training programmes and mechanisms are

would work, but what it’s actually led to wasn’t quite what we thought. “As a result, we’ve had to tweak

there to support the team, who still

and create new roles to deliver and

need to be able to trade and fulfil the

help with the process management

consumers’ needs.

of all these functionalities that we’ve built on, as these roles never existed in our business before. So, it’s been understanding and navigating the training path well.

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A C C E N T G R O U P LT D

“We’re definitely in the phase of a growing businesses; new digital presence, opening new stores, acquiring businesses, as well as looking for brand opportunities that we can bolt on to our 130 existing business” — Tim Greenstein, General Manager Supply Chain & Technology

“The business has a strong focus

“We want to make sure we’re the best

on stock integrity and stock trade

retailers out there,” explains Green-

mechanisms, as this is key to ensuring

stein. “Our CEO always says we don’t

the end to end omni channel experience

do average – we try to be different and

is effective and accurate.”

really make a difference and it’s part of

They both concur that in order to succeed at Accent, employees need commitment, drive and a “can do” attitude. FEBRUARY 2019

the ‘make it happen’ culture to make sure we try and recruit the right people. “It’s very important to retain talent and give people the opportunity to grow


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Promotional banner for The Athlete’s Foot

131

within the business. We also need people that can

“Certainly, from the supply chain point of

be very agile. The rate at

view, if you’re coming here

which business rolls out

just to have a day to day job

projects is really not matched

of one task, that’s not going to fly

anywhere else that I’ve seen in my time,

because our business continues to

so you need people that can come in

grow and evolves so quickly that you

and be ready to move, depending on

need to have people that can thrive in

your role of course.

that environment – it’s not for everyone.” w w w.suppl yc ha i ndi gi ta l. com


A C C E N T G R O U P LT D

Accent’s footprint and capabilities

set to increase when Accent moves “Part of the are at some point internationally potentially learning for to Asia in 2019. “We’ll never lose focus on our roots us is that here in Australia,” adds Greenstein, “as we’ve created demonstrated by our recently opened Platypus Superstore in roles that we 600sqm Melbourne Central and a Pitt Street didn’t expect Sydney Superstore opening mid-2019. But we’re starting to explore how we to create” broaden our footprint is the next stage,

— Tim Greenstein, General Manager Supply Chain & Technology

132

especially as the digital economy continues to grow.” The long-term visions of the AGL Supply Chain team are focusing on that speed to consumer portion. At board level, it’s to create greater opportunities from a vertical product perspective too. Accent recently secured the rights to the Supra brand, launched kids’ specific online brand, The Trybe, and also purchased premium footwear brand Subtype, which plays in the premium space with one store and an online presence. “Our strategy at the moment is very much to continue to invest in store infrastructure where it makes sense and where we see growth, while obviously driving all the other channels

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$676mn Approximate revenue

1981

Year founded

5,000+

Approximate number of employees 133 at the same time,” adds Greenstein. “Our CEO and board are very proactive in finding brands that are going to

and speed, is becoming more and more critical. “We must make sure that we can keep

align with us and help us solidify that

up with the requirements of what the

leadership space in the athletic

customer wants while always being

footwear or the leisure footwear space.

flexible and able to make sure that we

“We’re definitely in the phase of a growing businesses; new digital presence, opening new stores, acquiring

deliver and meet their requirements,” he surmises. “Customers these days have a diffe-

businesses, as well as looking for

rent way of operating and engaging,

brand opportunities that we can bolt

and what’s convenient for one is not

on to our existing business.”

actually the same for another, so the

From the market perspective, the

time to be able to keep up with the

consumer continues to come up with

demand and need is going to be a critical

new ways and new requirements of

factor going forward.”

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WRIT TEN BY

CATHERINE S TURM AN PRODUCED BY

ARRON R A MPLING

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C R E AT I O N T E C H N O L O G I E S

Creation Technologies has digitally overhauled its supply chain capabilities and sought to upskill its talented workforce to become future supply chain leaders

G

lobalization and digitization are fully disupting the supply chain industry, where connectivity and demands for rapid, efficient

solutions are driving continuous change. From utilizing predictive analytics to unlock greater value from 136

large volumes of data, to the implementation of automation, robotics, Internet of Things (IoT) and cloud computing, the industry is undergoing a seismic shift. In order to garner further insights in remaining agile and to guarantee customer trust, industry leaders have sought to reshape traditional supply chain models. Providing exceptional end-to-end solutions for original equipment manufacturers (OEMs) worldwide, Creation Technologies is no stranger in delivering bespoke solutions for those who in need of a responsive design and manufacturing partner. Amidst an evolving technology landscape, the company has partnered with more than 200 OEMs worldwide since its inception, accelerating time-to-market, reducing customer operating costs, while sharing innovative ideas FEBRUARY 2019


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Know sooner. Act faster. Eliminating volatility in your supply chain is impossible. Managing it doesn’t have to be. Kinaxis® helps the world’s top brands keep customer promises by solving complex supply chain problems with simple, innovative and measurable solutions people love to use. Plan for any future. Monitor threats and opportunities. Respond in real-time. It’s all possible with Kinaxis. www.kinaxis.com


Keep customer commitments in an unpredictable world Delivering fast, accurate response with Kinaxis RapidResponse

In today’s non-stop high-stakes world of complex global commerce, companies thrive or fail by the responsiveness of their supply chains. Commitments must be met, margins maintained and market share fiercely protected. Responding to customers with the correct answer at the right time can be a big challenge when shifting trade regulations, devastating events and unexpected market demands threaten supply chain stability. Creation Technologies, a global provider of transformative end-to-end solutions for OEMs, understands how critical fast and accurate responses are for customers. It’s why the company chose the Kinaxis® RapidResponse® platform. Leveraging RapidResponse’s supply chain planning applications, concurrent planning technique and what-if scenarios, Creation Technologies is highly responsive and agile in the face of any supply chain challenges that arise. Concurrent planning delivers a supply chain that’s completely connected and synchronized. The company also has increased visibility and flexibility to yield supply chain opportunities, and is able to leverage economies of scale in procurement while reducing landed cost. “With RapidResponse, we can predict, monitor and respond to supply chain challenges proactively from a single concurrent point of view,” said Ana Cantu, Executive Vice President of Supply Chain, Creation Technologies. “This enables us to mitigate risk, control volatility, shave cost and increase value for our customers every day. And that’s what we’re all about – building tangible value for our OEM customers.”

Making the right planning decisions with confidence From demand planning to capacity planning to supply balancing and more – all powered by empirical data and predictive analytics – RapidResponse’s cross-functional collaborative applications help Creation Technologies enhance process planning, minimize constraints and enhance supply chain performance.


C R E AT I O N T E C H N O L O G I E S

“One of our biggest challenges is the complexity of our business. We serve higher mix, low to mid-volume markets, which drives very high mix in our supply chain” — Ana Cantu, Executive Vice President of Supply Chain

140

which can ultimately lead to increased annual revenue. Leading the company’s USD 500mn+ global supply chain function across Canada, Mexico, China and the United States, Executive Vice President of Supply Chain, Ana Cantu admits that she remains fiercely passionate about “not only adding value to the businesses, but to the individuals that are the heart of the partnerships between Creation Technologies and its customers.” Stepping into her first leadership FEBRUARY 2019


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141

role aged 25, Cantu has been a sign-

steady price increases previously

ificant force in driving the digital

unheard of.

transformation of Creation’s supply

With nine manufacturing facilities,

chain, where over the last few years,

two design centers, a rapid prototyping

high growth market segments, such

center and a global materials sourcing

as automotive, medical and Internet-

group at the business, Cantu has sought

of-Things (IoT) products have caused

to overhaul its end-to-end product

a number of supply constraints across

supply and demand planning capabilities,

all markets. This, combined with supplier

as well as its distribution and logistics

consolidation in several component

divisions for all business units. Taking

markets such as ceramic capacitors,

a deep dive into its business model and

has created a complex dynamic, where

the number of suppliers at the business,

such constrained supply has led to

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C R E AT I O N T E C H N O L O G I E S

with which it can develop vital synergies and build an open dialogue and environment to bring forth an innovative business approach which is not only mutually supportive, but more effective in meeting customer needs. “One of our biggest challenges is the complexity of our business. We serve higher mix, low to mid-volume markets, which drives very high mix in our supply chain,” she explains. We have nearly 100,000 active component part numbers and ship over 15,000 finished goods 142

from all nine sites. Developing tools and processes that standardize practices and consolidate activities where synergies can be realized are a critical piece of our supply chain transformation journey.” Building a deep understanding of its customers’ needs and providing highly responsive tailored solutions, Creation is the optimal partner for the high complexity, low to mid volume products of mid-sized and smaller OEMs with well-established market positions. B2B data interfaces with suppliers and customers are increasingly common for Creation, where it has looked to unlock the opportuniFEBRUARY 2019


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143 ties available across an increasingly agile supply chain. “During 2018, Creation saw growth with customers across all market sectors. Technologies, such as IoT are driving growth, along with a strong economy. Creation is particularly strong in the medical and industrial market, which are both experiencing strong growth,� she adds. Nonetheless, as global competition continues to rise, it is clear that technology alone cannot be the sole area of investment to ensure success across the supply chain. Faced with opportunities to collaborate with w w w.suppl yc ha i ndi gi ta l. com


C R E AT I O N T E C H N O L O G I E S

C OMPA N Y FA C T S

• The US Bureau of Labor Statistics has reported that jobs in logistics in particular are estimated to grow by 26% between 2010 and 2020 • Globalization and digitisation are fully disrupting the supply chain industry, where connectivity and demands for rapid, efficient solutions are driving continuous change • Amidst an evolving technology landscape, the company has collaborated with more than 200 OEMs worldwide

144

• Cantu has sought to overhaul its end-to-end product supply and demand planning capabilities, as well as its distribution and logistics divisions for all business units • Creation has therefore turned its attentions towards high complexity, low to mid volume products for mid-sized and smaller OEM’s with well-established market positions

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145

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C R E AT I O N T E C H N O L O G I E S

“Technologies, such as IoT, are driving growth. Creation is particularly strong in the medical and industrial market, which are both experiencing strong growth” — Ana Cantu, Executive Vice President of Supply Chain

other market leaders in order to build on its competitive edge, Creation has 146

partnered with Kinaxis and deployed the company’s Rapid Response software to improve its responsiveness and ability to remain nimble as consumer demands evolve. “Rapid Response is a best-in-class and well-established tool for this purpose. After reviewing several options, Rapid Response was the clear choice for Creation,” explains Cantu. “More than anything, Rapid Response allows us to be much more responsive. Analysis that used to take days now takes minutes. We can quickly evaluate changes in demand and associated constraints, allowing us to make decisions much faster.” FEBRUARY 2019


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Presently in its implementation phase, three out of Creation’s nine business units have utilized the software and witnessed significant improvements in responding to customer demands, as well as identifying supplier constraints. This has also filtered into its ability to share essential findings with customers and propose new solutions which would best fit the specific business situation. Further, Creation’s supplier portal increasingly allows the firm to consolidate all its procurement activities across nine sites into a single location, leading to complete end-to-end visibility and strong operational efficiency. “Communication with our suppliers is now automated, eliminating the need for our procurement team to manually generate material requirements planning (MRP) signals to our suppliers,” adds

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C R E AT I O N T E C H N O L O G I E S

Cantu. “We are in the early stages of

Creation will continue to stay on the

implementing the software, but the

leading edge of these developments.”

signs are good and we expect to achi-

148

Although supply chain management

eve the savings outlined in our original

remains a vital component to any

business plan. The capabilities of B2B

successful organisation, global supply

tools will also continue to expand, allo-

chain labor shortages will continue to

wing supplier and customer ERP sys-

feed into increased demands for talent

tems to interface directly, with fewer

worldwide. The US Bureau of Labor

layers of human interpretation and action.

Statistics has reported that jobs in logis-

“Rapid Response allows us to be much more responsive. We can quickly evaluate changes in demand and associated constraints, allowing us to make decisions much faster” — Ana Cantu, Executive Vice President of Supply Chain

FEBRUARY 2019


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tics in particular are estimated to grow

skillset as a result of increased digitiza-

by 26% between 2010 and 2020.

tion and strategic thinking.

A report by DHL, ‘The Supply Chain

“The ideal employee has both tactical/

Talent Shortage: From Gap to Crisis’ has

operational expertise and professional

also found that demand for supply chain

competencies such as analytical skills,

professionals exceeds supply by a ratio

but 58% of companies say this combi-

of six to one. Not only are increased

nation is hard to find. Additionally,

numbers retiring from the workforce,

tomorrow’s talent must excel at leader-

workers are now asked to have a varied

ship, strategic thinking, innovation and high-level analytic and technological capabilities,” the report explains. Passionate about upskilling the workforce to counteract these challenges, Creation Technologies succeeds in attracting and developing its workforce, due to its vision of making its employees their customers trusted partner and investing in its team members, moulding them into professional supply chain leaders of the future. “We are a growing company with great opportunities for our people. We have a strong purpose, which is to enrich lives by sustaining strong profitable growth in an enjoyable and caring culture. I enjoy our fast-paced environment with its many challenges and the opportunity to constantly learning new things,” notes Cantu. “However, what I enjoy most is being able to spend time with my team to develop w w w.suppl yc ha i ndi gi ta l. com

149


C R E AT I O N T E C H N O L O G I E S

150

“The capabilities of B2B tools will also continue to expand, allowing supplier and customer ERP systems to interface directly, with fewer layers of human interpretation and action” — Ana Cantu, Executive Vice President of Supply Chain

FEBRUARY 2019


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and coach them, as well as spending time with customers, consulting them on their needs. Ultimately, I suppose I enjoy helping those around me to succeed.� Creation partners with OEMs to deliver and scale the results that matter most to them – across the entire product lifecycle. To achieve such impact, Creation promotes technology leadership, cross-functional collaboration, and a responsive supply chain network founded on a robust digital infrastructure. Working hand in hand with its customers Creation provides tailored supply chain solutions to bolster their market competitiveness. Creation will continue to invest in its workforce and deploy innovative digital tools; continue to grow, continue to lead, and deliver the high level of performance demanded by the evolving needs of its clients.

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152

Competitive advantage through digital transformation WRIT TEN BY

HARRY MENE AR PRODUCED BY

MIK E SADR

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OSM MARITIME GROUP

We sit down with OSM Maritime CTO Chakib Abi-Saab to find out how the company is using AI, machine learning, IoT, drones, augmented reality, blockchain and automation to empower its 11,000-strong workforce

F

ounded in 1989, OSM Maritime has grown from a single crew-management contract to a fleet of over 500

vessels managed from 26 offices around the 154

globe. Business Chief sat down with OSM’s Chief Technology Officer, Chakib Abi-Saab to find out how one of the world’s largest maritime management companies is using breakthrough technologies to empower and unite its 11,000 employees. “Technology is not the solution to everything,” says Abi-Saab, “but it is a very important toolset that enables us to provide better and more reliable services, and facilitate greater transparency with our clients.” He explains that “as a whole, the industry has not adopted technology on a large scale. I think at OSM we have been very aggressive. We believe that business gains, transparencies and improvements in relationships, and efficiencies that we gain from technology FEBRUARY 2019


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Empowering tomorrow’s digital winners

Simplifai is your in-house automation partner, through the use of Artificial Intelligence we automate routine tasks in offices such as customer service, accounting and HR.

Find out more here www.simplifai.ai | Email: sales@simplifai.ai Phone: +65 9044 4716 (Asia) +47 4150 3263 (Europe)


EUROPE

equal a competitive advantage”. At the

access to correlations that we, as

heart of the company’s technological

humans, might not be able to see. We’re

transformation is its Maritime Opera-

expecting to move to the next level with

tions Centre, located in Singapore.

machine learning, so that we can perform

Abi-Saab presided over the Centre’s

predictive analytics and predictive main-

creation in 2018 and will oversee the

tenance which will become a cost

construction of a second facility in

savings to us and to our customers.”

Arendal, Norway in 2020. The Centre

As Chief Technology Officer, Abi-

enables OSM to monitor and manage

Saab is currently overseeing the adop-

the company’s global fleet 24 hours

tion of several new technologies to

a day. Abi-Saab explains that, with the

further enable OSM’s technical manag-

Centre in operation, “We not only have

ers to perform their roles. At the core

information that used to take weeks to

of each new technology, he empha-

gather, but the computer also gives us

sises, is the ethos that “technology is

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

Chakib Abi-Saab Chakib is a business leader and technologist with 20+ years of experience aligning technology with operational goals. Chakib has led significant global projects in multinational environments and has played several key roles in global organizations like Baker Hughes Inc. and Bumi Armada Berhad. Chakib is now the Chief Technology Officer of OSM Maritime Group. Chakib’s main focus is always on the utilization of technology as a driver to optimize costs, improve productivity, increase returns, reduce risks, and create new revenue streams. His technology expertise is in connected assets, analytics, automation, and predictive environments. He is also experienced leading complex multinational digital transformations.

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OSM MARITIME GROUP

a way to give people the right informa-

best possible people to manage our

tion so that they can make decisions

ships. But the reality is that you cannot

based on what’s happening at that

have experts for everything on every

particular time, operationally and fin-

ship.” This is where one of OSM’s latest

ancially”. New initiatives that OSM is

pieces of technology comes into play:

aggressively testing or already using

augmented reality goggles. Allowing

include machine learning and AI, edge

on-ship staff to display in real time the

computing, augmented reality, drones

repair process enables OSM to “take

and blockchain.

advantage of the 11,000 people in the

“Imagine you are managing a ship

company for expertise that can walk

and one part of the engine breaks,”

our engineers through the solution,

says Abi-Saab. “Well, we in OSM do

because we can see what they see

the best possible job we can to hire the

and we can send diagrams that they

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CLICK TO WATCH : ‘#TRENDSPOTTING WITH OSM & OUR AMAZING PARTNERS’ 159 see through the augmentative reality goggles,” explains Abi-Saab. “We expect that having these augmentative reality goggles on our ships will mean that challenges that could, today, disable a ship would be dramatically reduced. We will have people with the right expertise helping us resolve those problems. So, the efficiency gains will be dramatic.” OSM also operates a number of offshore oil & gas facilities. In the past, an operational event that required an underwater inspection would result in halted production for prolonged periods of time, while trained divers w w w.suppl yc ha i ndi gi ta l. com


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“Simplifai has proven to have deep understanding or processes combined with RPA, among other skills” — Chakib Abi-Saab, CTO OSM Maritime

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OSM MARITIME GROUP

 







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“We believe that IOT is going to be the key to preventive maintenance” — Chakib Abi-Saab, CTO OSM Maritime 163

would be deployed for surveillance and

“Part of the immediate efforts to build

repairs. Now, Abi-Saab says, that

efficiencies through digitalization

could change. “When you stop a rig

includes working very closely with our

operation, you’re talking about hun-

partners of Simplifai to completely

dreds of thousands of dollars lost on

evaluate and re-engineer processes

an hourly basis. If you have a drone in

with the objective of then using Robotics

the water that can do the same job, you

Process Automation (RPA) to speed

do not have to stop the operations.

up the execution of repetitive tasks and

So, it not only increases safety but it

reduce manual intervention,” adds

increases profitability.” OSM is consid-

Abi-Saab. Simplifai is a holistic artificial

ering the adoption of drones for both

intelligence solutions company head-

underwater and aerial inspections in

quartered in Oslo, Norway. By using

combination with video analytics on its

Simplifai’s technology to automate

rigs and ships under management.

routine tasks, Abi-Saab estimates OSM w w w.suppl yc ha i ndi gi ta l. com


OSM MARITIME GROUP

C OMPA N Y FA C T S

• OSM: 11,000 employees, 25 office locations, a fleet of 500 vessels, and a 90% customer retention rate • Simplifai: OSM’s new partner, experts in AI solutions, particularly Robotics Process Automation

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will be able to increase efficiency in

of machine learning, AI, IoT and edge

those areas by up to 50%. The adoption

computing to record the most relevant

of RPA will also bring scalability and

information from its fleet and parse it for

improved data quality due to the error

insights into operational solutions. “We

reductions inherent to automation.

believe that IoT is going to be the key to

“We are now an organization that takes

preventive maintenance,” Abi-Saab

advantage of data and business

says. “But we need to approach it very

intelligence to make better decisions,

smartly. You can find sensors for every-

and having error-free data means better

thing, but not everything that can be

decisions, and having only one version

measured should be measured and not

of the truth,” says Abi-Saab, adding

everything that should be measured

that “Simplifai has proven to have deep

can be measured. So we’re currently

understanding of processes combined

working to identify what are those areas

with RPA, among other skills.”

that, if we measure, would give us the

As well as tools for gathering and

efficiency gains that we are looking for.”

redistributing knowledge and raw data,

Uniting information from every indi-

OSM is dedicating itself to the adoption

vidual system OSM has in operation

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OSM MARITIME GROUP

166

within a centralised database, the

functions as a single harmonious

Operations Centre helps to prevent

ecosystem. “Having all the information

the company’s solutions from becom-

in a centralized database will give us

ing siloed. “We have experienced the

several advantages,” notes Abi-Saab.

same challenges as everybody else

“First is the ability to properly monitor

in the industry,” admits Abi-Saab. “Part

security. Second is the ability to properly

of the creation of the Operation Center

back up our data and restore it in the

comes in a second phase where we

event of an emergency or disaster so

will create a fully centralized database,

that we have proper business continu-

which holds information from every

ity. And third, it will give us the ability

system we have in the organization,”

to have smart algorithms of artificial

helping to ensure company’s tech

intelligence from our machine learning

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167

software going through the data, so

edge computing, and machine learning

that we can get correlations that would

as part of a centralised database will,

possibly not be imagined by humans‌

Abi-Saab believes, lead to significant

Similarly, we are looking at edge comp-

efficiencies for OSM, as the company

uting technology so that, not only

gains insights into preventative main-

will we have analytics onshore in the

tenance strategies. “Imagine that you

operation center, but the people who

have a fleet of ships around the world.

manage the ships also have access

Normally, the way maritime companies

to real-time analytics so they can

work is you have Vessel Managers

make better decisions.�

onshore and you have the Captains in

Identifying trends in ship maintenance using this combination of IoT,

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“Pursuing technology solutions will help us create technical ability,security, reliance and efficiency gains in everything we do” — Chakib Abi-Saab, CTO OSM Maritime

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OSM MARITIME GROUP

if a ship breaks in Brazil and then another breaks in Africa and another stops working in Europe, under normal circumstances each incident might be seen as an isolated case. But, if you have all the information in one centralized database, artificial intelligence can detect a trend, ships that are similar, or parts that are similar that are breaking. Then it starts telling you, based on the past history of Ships A, B and C that we should change a particular part of this type of ship because it’s about to break. That’s when you truly create value.” 170

OSM Maritime’s exploration and adoption of digitally transformative technologies is comprehensive and happening at speed. A large part of Abi-Saab’s role is to ensure the company’s slogan, “It’s all about people,” is respected and adhered to. “We believe that technology, without the support and knowledge of the people, would not be as efficient and would not give you the value that you need,” he explains. “We are focusing on aggressive change management plans that not only choose the proper technologies but also communicate to everyone in the organization that will be affected what is happening, why that is happening, and how that will affect them. Because the better people understand FEBRUARY 2019


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171

the positive impact the adoption of technologies has on their job, the more their resistance to it is reduced.” For example, OSM is currently examining the possibility of a partnership with a company specialising in blockchain technology. The digital ledger technology would address a challenge faced by OSM crew members: paper certificates and documentation. “If those certificates are lost, it’s going to take them weeks, potentially months, depw w w.suppl yc ha i ndi gi ta l. com


OSM MARITIME GROUP

$100mn Approximate revenue

1989

Year founded

11,000+

172

Approximate number of employees

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ending on where in the world they are, to get them back. Without those certificates, they cannot board a ship,” explains Abi-Saab. “If we have a blockchain solution that enables them to produce real time information about their training and certificates to ship owners anywhere in the world, then it would become quite an interesting solution.” 2019 and 2020 promise to be exciting years for OSM Maritime. Abi-Saab predicts that the next year will see a tipping point for the company, where “pursuing technology solutions will help us create technical ability, security, reliance and efficiency gains in everything we do today, with the aim to become a highly-predictive analytical, artificial intelligence and machinelearning-based organization in 2020.”

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Delivering the gift of sight through a robust supply chain transformation WRIT TEN BY

L AUR A MULL AN PRODUCED BY

CHARLOT TE CL ARK E

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ESSILOR

Tasked with taking care of one of our most vital senses, Vladimir Zhirnov, Global Sourcing and Procurement Director of Supply Chain & Transport at Essilor, is ensuring the company’s supply chain is up to the challenge 176

8

0% of the sensory informa-

Every day, Essilor manages more

tion that the brain receives

than 3,000 lens flows and over one

comes via sight, making

million product references, relying on

vision one of our most important

an expansive network of 34 produc-

senses. However, our eyes are complex

tion sites, 14 distribution centres and

organs and are rarely perfect: in fact,

481 prescription labs. This means that

nearly two out of three people suffers

efficient supply chain management

from vision problems. The invention of

is crucial. One professional at the

lenses has been an invaluable aid, and

helm of this robust supply chain is

with a streamlined, agile supply chain,

Vladimir Zhirnov, Global Sourcing

Essilor, is ensuring that customers

and Procurement Director of Supply

can get these vital solutions as quickly

Chain & Transport.

as possible. FEBRUARY 2019

With over a decade of experience


ASIA

177

working at Essilor, Zhirnov has been

supply chain function to align it with

there every step of the way as the firm

the firm’s global vision. As a result,

has expanded its footprint through

Essilor’s network footprint now able

organic growth and local acquisitions.

to support more than 2mn unique

By drawing upon his expertise at

stock keeping units (SKUs).

Essilor from a local, regional and eventually a global level, Zhirnov says

A ROBUST, DATA-DRIVEN SUPPLY CHAIN

it’s given him “an entire understanding

Digitalisation drives Essilor’s global

of how the company functions, what

supply chain which is dedicated to

the current trends are, as well as the

producing and delivering over 540mn

needs of different countries”.

lenses a year with a high degree of

During this period, Essilor had to restructure its procurement and

personalisation for individual wearers. Over the past two decades, Essilor w w w.suppl yc ha i ndi gi ta l. com


ESSILOR

has developed a robust digital backbone linking its ecosystem of production sites, prescription labs and distribution centres with over 350,000 customers, to its lens design, ordering and fulfillment systems. It’s a highly data-driven operation, requiring millions of rapid digital exchanges between customers and every part of the value chain from receiving prescriptions and fitting details to sending manufacturing instructions to a lab. To ensure optimal speed, performance and reliability, Essilor has migrated certain steps as cloud-based services, for 178

example, a powerful calculator capable of generating lens designs to the more advanced personalized measures linked to the Group’s latest Varilux® X series™ progressive lenses. Essilor is already exploring the future of data-driven manufacturing with the creation of a concept Lab 4.0 at its Dallas campus, as well as exploring how artificial intelligence, machine learning, and collaborative robots can improve planning, production, and customer service. The secret behind Essilor’s explosive growth lies in its commitment to R&D, with more than €200mn dedicated each year to research and innovation. This allows the firm to offer exclusive products that distinguish it from its competitors, but with swathes of FEBRUARY 2019

“Essentially, the supply will be doubled, the external logistics will be doubled and we’ll also have two different systems and organisations that needs to be combined” — Vladimir Zhirnov, Global Sourcing and Procurement Director of Supply Chain & Transport at Essilor


ASIA

customised products comes more logistical challenges. This is where Essilor’s worldclass supplier network lends a helping hand. “We have more than 30,0000 suppliers, of which 1,000 are logistics and supply chain vendors,” explains Zhirnov. “We classify these suppliers into three grades whereby we have 14 strategic vendors, 500 preferred vendors and the rest classified as others.” With such a complex network of partners, supplier relationship management is critical and as such Essilor has developed a thorough relationship management program which ensures that its strategic vendors have a mutually beneficial partnership. “It helps us understand what the partnerships are going to achieve, what our plans are, and how we can support each other to complete these missions,” he says. But why is supplier sustainability so important for Essilor? “We believe that if we work hand in hand with our suppliers, together we can increase the positive impact of our business in the communities where we work,” notes Zhirnov. “For the past two years in our Sourcing and Procurement team, we’ve set out to involve our network of suppliers in different ways. In addition to driving compliance with Essilor’s responsible business practices, we engage suppliers in three key areas: promoting visual health through awareness raising w w w.suppl yc ha i ndi gi ta l. com

179


ESSILOR

and screening actions; responsible

and his team. To tackle this, Essilor has

sourcing from economically vulnerable

developed a shrewd strategy to drive

populations; and positive environmen-

down freight costs in the form of regional

tal initiatives through sharing best

docking hubs. In essence, this means

practices and implementing eco-re-

that all products heading to Asia, for

sponsible approaches.�

instance, have one point of arrival by air freight. They are then distributed by

A GLOBAL POWERHOUSE, WITH REGIONAL EXPERTISE

road and air within the continent with

As is the case for any procurement or

“The concept is that we are entering

supply chain professional, managing

one continent by air freight at one

costs is a key consideration for Zhirnov

point and then we are leveraging our

help from local or regional partners.

180

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

Vladimir Zhirnov Vladimir Zhirnov, who began his career as a part-time sales rep while in college, serves currently as Global Sourcing and Procurement Director of Supply Chain & Transport at Essilor International. Based from Singapore, he helps to deliver value across the organization with global footprint in over 100 countries, 600 entities, and 33 manufacturing plants including wholly owned businesses, joint ventures and partnerships. Previously in his career, he helped to lead the transportation/ freight strategy for Europe.

FEBRUARY 2019


ASIA

partners to distribute our products throughout the country,” Zhirnov says. “If you have 30 plants and you are sending products to smaller markets, Malaysia for example, it’s quite costly to continuously feed into the country directly from across the global plants. Therefore, we send upstream shipments to our regional docking hubs and distribute products from there.”

“We have more than 30,000 suppliers, of which 1,000 are logistics and supply chain vendors” — Vladimir Zhirnov, Global Sourcing and Procurement Director of Supply Chain & Transport at Essilor

Similarly, Essilor distributes all its Middle Eastern products from Dubai 181

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and all its European products from

Group’s capital is held by employees

Paris. Employing over 67,000 people

who are also involved in the com-

and developing its production and lo-

pany governance. “This decentralised

gistics footprint globally, this extensive

decision-making offers us transparen-

presence is a key accomplishment for

cy and the responsiveness to different

the firm. “We’re really helping to con-

regions,” he explains.

tribute to skills development in different countries,” Zhirnov says. Today, Essilor

CONCENTRATING ITS EFFORTS

has a global footprint spanning around

As well as selling a variety of lenses,

100 countries and as it continues to

Essilor has also claimed a portion of

grow this logistical challenge will only

the consumables market – providing

get greater. A key factor for Zhirnov is

vital tools and items needed to solder

ensuring regional needs are being met

parts and edge lenses, for example –

and this is in part achieved by giving

but this hasn’t come without its

employees a voice – 65% of employees

challenges. In the US market, for

are shareholders and around 4% of the

example, there were several players

FEBRUARY 2019


ASIA

183

within the group competing for a slice of the pie which threatened Essilor’s margins. By working closely with a third-party logistics (3PL) network design consultant, however, the firm has found data analytics to be a useful tool to tackle this hurdle. “We analysed all the inbound data, the sourcing data, and the customer-based data

“We’re really helping to contribute to skills development in different countries” — Vladimir Zhirnov, Global Sourcing and Procurement Director of Supply Chain & Transport at Essilor

to identify our core areas in the US,” reflects Zhirnov. By redesigning its w w w.suppl yc ha i ndi gi ta l. com


ESSILOR

“We ensure that the materials we are buying are not manufactured through child labour and don’t come from regions where minerals are extracted in an improper way” 184

— Vladimir Zhirnov, Global Sourcing and Procurement Director of Supply Chain & Transport at Essilor

consumables network, Essilor recon-

company’s merger with Italian eyewear

figured its distribution centre locations

company Luxottica, which owns brands

in the US and focused its efforts on

including Ray-Ban, Oakley and Sunglass

areas where it was needed most. This

Hut. This will not only propel Essilor’s

helped to drive labour, capex rationali-

and Luxottica reach farther into the

sation, reduce freight costs and more.

various markets, but it will also undoubt-

“It offered us better costs, lower

edly impact the firm’s sourcing logistics

investments and at the same, it ensured

and supply chain. Although this deal is

we designated channel champions so

still in its early stages, there’s a lot to

to avoid competing against each other.”

consider. “Essentially, the supply will be doubled and we’ll also have two

A HISTORIC MERGER

different systems and organisations

Another project which Zhirnov has a

that needs to be combined”, Zhirnov

keen eye on revolves around the

observes. So whilst this transition is

FEBRUARY 2019


ASIA

factured through child labour and don’t come from regions where minerals are extracted in an improper way,” Zhirnov adds. On top of this, the firm has also set itself another impressive task: to eradicate poor vision by 2050. “It’s the most honourable part of why we go to work every day,” asserts Zhirnov, pointing out how 2.5bn people still lack vision correction today. Through forging partnerships with NGOs, national governments and the private sector as well as facilitating the development of local social entrepreneurs networks, Essilor hopes to understand local in its early stages, Zhirnov is confident

needs and barriers so that it can create

that the integration will be seamless.

vision care infrastructure that is both

Knitted into the fabric of Essilor’s core

purposeful and sustainable. In the

mission is its sustainable approach,

coming years, Essilor may grow its

and this hasn’t gone amiss when it

supply chain and procurement function

comes to the company’s supply chain

further, but it seems the top item on

and logistics management. As part of

Zhirnov’s agenda can be best summa-

its 2020 sustainability strategy, 100%

rised by the firm’s mission: “improving

of Essilor’s strategic suppliers will re-

lives by improving sight”.

ceive an external CSR audit and 100% of its preferred supplies will acknowledge Essilor’s Supplier Charter. “As part of this, we ensure that the materials we are buying are not manuw w w.suppl yc ha i ndi gi ta l. com

185


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Profile for Supply Chain Digital

Supply Chain Digital Magazine – February 2019  

Supply Chain Digital Magazine – February 2019