CARGOCONNECT JULY2024 - Flipbook - Page 54
Transforming Logistics for
Efficiency and Customer Delight
Logistics plays a crucial role in supply chain management, enhancing
e昀케ciency throughout the process. Its
primary objective is to deliver products
to customers on time, with the right
quality and cost. Through strategic
partnerships with suppliers, shippers,
and warehouses, and integrating these
services via automated systems such
as Warehouse Management Systems
(WMS) and Transport Management
Systems (TMS), logistics operations
are streamlined, reducing overhead costs and improving delivery
speed. This enhances customer satisfaction, measurable through
Fill Rate and On-Time In-Full (OTIF) KPIs, while optimising costs.
E昀케cient planning of warehousing and transportation activities is
essential to reducing order ful昀椀llment times. Implementing WMS
improves Warehouse Turnaround Time (TAT) from order receipt
to dispatch, while TMS optimises transport planning, identifying
cost-e昀昀ective carrier routes and maximising truck utilisation. This
transformation positions logistics as a value creator, delivering
stakeholder value and customer satisfaction.
Warehousing Strategy
Our warehousing strategy is built on the following pillars:
a. E昀케cient Warehouse Design: We optimise labour-intensive
operations by making informed decisions about warehouse layout,
based on inventory demands and seasonal 昀氀uctuations. E昀昀ective
slotting of goods ensures smooth material 昀氀ow, minimising nonvalue-added travel. A昀昀ordable automation further streamlines
material handling, enhancing e昀케ciency.
b. Outsourcing: We strategically outsource non-critical warehouses
to realise 昀椀nancial and operational bene昀椀ts while maintaining
control. We ensure these warehouses meet our standards for
capability and technology, supporting our commitment to yearon-year cost e昀케ciency.
c. Technology Integration: Implementing WMS enables real-time
decision-making and enhances operational visibility, driving
performance management through KPI monitoring.
d. Labour Optimisation: Leveraging digital solutions, we optimise
resource allocation for each warehouse activity. Flexible labour
arrangements, including long-term contracts, help achieve e昀케ciency
metrics such as cases handled per man-hour.
Advancing Sustainable Supply Chains
Innovation and benchmarking form the bedrock of our supply
chain processes. Our supply chains continuously learn and improve
through internal and external references, incorporating cross-sector
learnings at an unprecedented pace. Innovations span every facet
of the supply chain, not just products. Sustainable manufacturing
practices, including plant electri昀椀cation, heat recovery, low-energy
alternatives, advanced water reclamation, and reduction and reuse
technologies, are being rapidly adopted globally.
Digitising tasks enables e昀昀ective daily operations, building
towards a paperless, smart, and digital manufacturing environment.
Next-gen process controls, like digital twins for optimising equipment performance, are implemented across factories worldwide.
Signi昀椀cant strides are being made in sustainable logistics, with
an increasing 昀氀eet of company-owned trucks using alternative
fuels like CNG or electric vehicles. Third-party logistics (3PL)
54 | CARGOCONNECT JULY 2024
providers are selected based on the
net impact of their transportation
activities. Initiatives such as using
recycled packaging, converting potato
slurry into biogas to power machinery,
and other sustainability efforts are
standardising processes and enhancing
product sustainability.
Strategic Partnerships
Logistics Service Providers (LSPs) play
a crucial role in creating overall value
within logistics. Shared visions and
aligned goals from the outset foster a
collaborative environment that bene昀椀ts both parties. The choice
of warehousing and transportation models depends heavily on
political-economic dynamics, cost factors, and the supplier landscape.
For LSPs, delivering orders at the lowest cost and highest e昀케ciency
is paramount, ranging from 3PL models to long-term leased,
company-operated warehouses. In the fast-moving consumer
goods segment, customer service is a primary KPI for success,
requiring technology-driven logistics to ensure timely order ful昀椀lment. Establishing a long-term shared vision with LSPs forms the
foundation for achieving overall success.
We collaborate with a wide range of LSPs across various regions.
Our selection process emphasises key criteria: 3PLs must prioritise
customer satisfaction and maintain high service levels. A robust,
well-documented, and repeatable process is fundamental to success. Safety is paramount, and a strong safety record is essential
in our LSP partnerships. Digitisation is increasingly vital, with
3PLs expected to adopt technology like WMS to enhance process
e昀케ciency in their operations. Technology-centric teams within 3PLs
align with our organisational goals. Flexible business agreements
that accommodate seasonal and market 昀氀uctuations rely on the
昀椀nancial stability of our partners, a critical evaluation criterion.
Lastly, a proven track record and positive industry reputation
ensure the long-term viability of our LSP relationships.
Megatrends in Supply Chain
Digital transformation is at the forefront, leveraging AI, IoT, Blockchain, and big data for enhanced visibility, agility, and predictive
capabilities.
Sustainability and ESG practices are becoming central to business
decisions, driven by consumer demand for eco-friendly products.
We’re reducing our carbon footprint through eco-friendly packaging and optimising transportation routes to minimise emissions.
Trade uncertainties, exacerbated by VUCA events like trade wars
and regional policies, require agile supply chain strategies. Balancing
near shoring and outsourcing is crucial for cost competitiveness
and resilience.
Addressing the skills gap and automation in logistics involves
upskilling teams to work alongside AI and robotics. Hybrid working
models post-COVID necessitate new productivity measures for
globally dispersed teams.
Advocating Lifelong Learnings
To young professionals entering the 昀椀eld of Supply Chain management,
I encourage you to embrace lifelong learning. The pace of change
today is faster than ever before, so continuous skill development
is crucial. Networking and learning from peers are also invaluable—some of the best advice for life and career often comes from
those around you who have valuable experiences to share.
