Supply Chain Digital – October 2020 by Supply Chain Digital

OC T OB E R 2 0 2 0

www.supplychaindigital.com

Asia’s Logistical Transformation

SUPPLY CHAIN EXECUTIVES

IBM’S GLOBAL PROCUREMENT TRANSFORMATION Exclusive Interview: Bob Murphy, Chief Procurement Officer of IBM

FOREWORD

elcome to the October edition

executives at AVEVA, Dassault

of Supply Chain Digital!

Systèmes and LLamasoft about

In this month’s cover feature, we speak exclusively with Bob Murphy,

how the technology is leveraged in a supply chain setting.

T:297 mm

CPO at IBM, as he discusses

This magazine is packed full of

digital transformation and the

in-depth company reports, featuring

effect COVID-19 has had on his

companies such as: AdoreMe,

organisation’s operations and the

Lufthansa Cargo AG, Dallah Trane

wider industry. “For IBM, as well

Manufacturing, Mediterraneo

as for many other companies who

Hospital and more that you won’t

have progressed on this journey,

want to miss!Finally, check out our

the transformation of procurement

Top 10 on the leading supply chain

has been driven by innovation,”

executives worldwide.

comments Murphy. Further, Tim Bridges, Global Head of Consumer Goods and Retail at Capgemini, talks about the influence of drones and AGVs as a result of the global pandemic, while we also

Would you like to be featured in the magazine? Get in touch at sean.galea-pace@bizclikmedia.com Enjoy the issue!

explore the impact of digital twin technology in the supply chain.

Sean Galea-Pace

Elsewhere, we explore the influence of digital twins and hear from www.supplychaindigital.com

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PUBLISHED BY

EDITOR-IN-CHIEF

Sean Galea–Pace DEPUTY EDITOR

Georgia Wilson EDITORAL DIRECTOR

Scott Birch CREATIVE TEAM

Oscar Hathaway Erin Hancox Sophie-Ann Pinnell Sophia Forte Hector Penrose

PRODUCTION DIRECTORS

MEDIA SALES DIRECTOR

Georgia Allen Daniela Kianicková

James White PROJECT DIRECTORS

Owen Martin

Justin Brand Caroline Whiteley

DIGITAL VIDEO PRODUCERS

DIGITAL MEDIA DIRECTOR

PRODUCTION MANAGER

Kieran Waite Sam Kemp DIGITAL MARKETING MANAGER

Shirin Sadr CHIEF MARKETING OFFICER

Jason Westgate CHIEF OPERATIONS OFFICER

Stacy Norman PRESIDENT & CEO

Glen White

Leigh Manning DIGITAL MARKETING EXECUTIVE

Jack Grimshaw www.supplychaindigital.com

10 28 DIGITALISATION IN SUPPLY CHAIN POST-COVID -19

The rise of Drones in Supply Chain Post-COVID-19

52 SUPPLY CHAIN EXECUTIVES

84 The Evolution of Digital Twins in Supply Chain

TwinThread

98 Lufthansa Cargo AG

116 Mediterraneo Hospital

126 Ooredoo Kuwait

138

150

Anheuser-Busch InBev Africa

PZ Cussons

ADORE ME

Digitally disrupting the fashion supply chain WRITTEN BY

SEAN GALEA-PACE PRODUCED BY

CAROLINE WHITELEY

OCTOBER 2020

suppl y c ha i ndi gi ta l. com

ADORE ME

Romain Liot, Chief Operating Officer, Adore Me, discusses his firm’s digital transformation journey in the fashion industry

dore Me is a disruptive ecommerce startup that is driven to revolutionise and transform the lingerie industry through

digital technology. Founded in 2012, Adore Me has 12

grown into a team of over 300 employees across the United States and Europe and is considered one of the fastest-growing companies in New York and one of the fastest-growing retailers in the United States. Romain Liot is the Chief Operating Officer and co-founder of Adore Me and has been with the organisation since 2013, having previously worked at McKinsey. “Adore Me is engineered for disruptions and we began with the intent to disrupt the lingerie market,” explains Liot. “We initially targeted a branding disruption to start with and originally began online; our tech team now consists of 40% of the total full-time employees.” Liot affirms that, as Adore Me was born digital, the company isn’t undergoing a classic digital transformation from little to no technology to a fully digitalised OCTOBER 2020

suppl y c ha i ndi gi ta l. com

ADORE ME

“ Adore Me is engineered for disruptions and we began with the intent to disrupt the lingerie market” —Romain Liot, Chief Operating Officer and Co-founder, Adore Me

OCTOBER 2020

AMS CLICK TO WATCH | 2:55

environment, but is instead leveraging

order management process, which

and implementing technology that cre-

brings state-of-the-art technology

ates value. “We’re digital-native, so it’s

to life. As a result, Adore Me became

a bit different,” he says. “We launched

one of the first companies to adopt

our warehouse three years ago and

Autostore and SureSort technol-

we’ve combined two technologies

ogy. Following the launch of the

together: Autostore and Suresort. This

warehouse, Adore Me can now fulfill

gives us an edge because we can list

over 20,000 orders every day, which

the products that are ready to ship

represents four times the volume of a

quickly on the website.”

conventional distribution centre. The

Considered an integral part of Adore

cutting-edge warehouse utilises robot-

Me’s second phase into expanding

ics technology and has been launched

internationally, the 126,286 sq.ft ware-

in a bid to allow Adore Me to stream-

house is home to a highly-automated

line operations and accommodate the suppl y c ha i ndi gi ta l. com

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One of the world’s leading mail and goods shipping providers. Asendia USA is the US arm of Asendia, one of the world’s leading parcel and mail shipping providers. Founded in 2012 as part of a joint venture with La Poste and Swiss Post, Asendia specializes in international shipping of packages, business mail, direct marketing materials, and publications. Asendia offers high quality B2C global delivery solutions for its customers. The organization is present in 17 countries across Europe, Asia, Oceania, and the US and provides a diverse range of ecommerce and mail solutions to empower businesses to grow across borders. Gary Shunk is Asendia USA’s Senior VP of Marketing, Pricing and Partnerships, with additional responsibilities in Sales and Key Accounts/Customer Care Management. “My experience in the logistics sector goes back 39 years,” he says. “I started out in sales and then went into management with FedEx back in the 1980’s. It was at FedEx that I benefited from solid sales management and leadership training. I left FedEx in 1989 to become an entrepreneur and have since contributed to the growth and development of the organization we are today.” With such extensive experience, Shunk has observed the transformation of e-commerce first-hand. “Global eCommerce has become a fantastic opportunity for growth, but can be challenging in the world we live in today,” he says. “The customs, security changes, and guidelines for shipping internationally require the ability to adapt to constant changes. Flexibility with choices while ensuring security and customs compliance is how we help companies achieve their goals. Parcel shipping is 60% of our business. Asendia’s strategy had to change in order for us to succeed, and that is what we did. Transporting sold products versus mail or printed matter is much different in many ways – and, as everyone now knows, speed and visibility are critical to the customer experience. Transportation companies have had to improve and expand their scope and coverage. Asendia is doing just that through expansion of facilities, acquisitions, improved automation, increased tracking capabilities, and above all employee safety. The e-commerce industry demands reliability and ease of use, and our strategy is to ensure we continue to provide both as one of the top players in the industry.” Having established a key, strategic relationship with Adore Me, Shunk believes that collaboration has been influential. “Adore Me began with a strict interest in the US market, but quickly saw the opportunity to grow their subscription model business into other English-speaking countries,” he

Gary Shunk @ Asendia USA

says. “Because of the trust we have built in each other’s people, systems, and capabilities, we are successful at working together and finding creative ways to adjust services. This flexibility allows us to find cost-effective solutions that meet the expectations of both organizations.” Shunk understands the importance of an individual approach and believes it is vital to create custom solutions for each customer. “We understand that one size does not fit all, so we make a point to work with each customer to create a customized solution that suits their business plan,” he says. “Some may want the most economical method for international distribution because their product value is low, and high international shipping costs on low-value orders can deter consumers from shopping outside their home country. Others want speed, and cost is not as critical. Almost all retailers want to be able to have the tracking visibility their consumers expect and the data that supports the performance.” With COVID-19 disrupting organizations globally, Shunk affirms that employee safety has become critical. “We’re very fortunate to have operations managers and operation workers that we have because they’ve gone above and beyond,” he says. “The pandemic has brought people closer together as a team. Communication has been positive and we’ve worked extremely hard. All six of our operating facilities have been able to stay open, but it has changed the way we manage our employees and how we remotely manage the company.” With the future in mind, Shunk has a clear idea of what he expects the next few years at Asendia to look like. “As the ecommerce industry continues to grow and adapt to the ever-changing needs of consumers, Asendia looks forward to continuing along on this journey with our customers to help them evolve with the changes and enjoy long-term growth and success with both domestic and international sales.”

ADORE ME

fast-paced growth of the organisation.

apart is its ability to be lean and agile in

“Imagine a giant cube with 73 robots

the market. “We have the right leader-

crisscrossing and bringing products

ship that empowers all of us to take

to an operator. We’ve married two

on responsibilities,” explains Shetty.

technologies together to essentially

“We are quick and agile, and embrace

sort orders and ensure the customer

technology that enables us to deploy

gets the perfect order,” affirms Nikhil

projects at scale. I feel this differenti-

Shetty, Supply Chain Manager. “It’s

ates us from our competitors and will

powered with strong algorithms where

help us grow over the next few years.”

we have intelligently stored products

“From a supplier management

and the finished product is a finalised

perspective, having tools that we’ve

sequence which allows the customer

developed internally and allow our

to have the right order that they want.”

suppliers to have access to has ena-

He adds that what sets Adore Me

bled us to speed up certain pieces

OCTOBER 2020

within our development process,”

processes and manage the shipment

explains Christina Chang, Product-to-

process is critical.”

Market Manager. “This has allowed

Liot believes that the most

us to have faster feedback from

important reason to introduce the

our manufacturers and has helped

warehouse was to be more autono-

reduce timings and has allowed us

mous and independent, while saving

to make decisions in a very effective

money. “We’ve made the decision to

way. Having those tools in place to

be more autonomous,” he explains.

allow us to manage our manufacturing

“We felt it was possible to disrupt the

E X E C U T I V E P R O FILE :

Romain Liot Title: Co-founder and COO

19 Company: Adore Me

Industry: Fashion Romain Liot is a co-founder and COO of Adore Me. Romain leads Adore Me’s team of 250 employees across the U.S. and Europe, focusing primarily on marketing and operations. With revenues growing exponentially from $1M in 2012 to over $100M in 2019, Romain has led Adore Me to become one of the fastest-growing companies in New York (ranked #17 on Crain’s Fast 50 in 2017) and one of the fastestgrowing retailers in the U.S. (ranked three times on the Inc. 500 list of the fastest-growing private companies in America). Prior to Adore Me, Romain spent seven years working as a management consultant for McKinsey & Company on projects in Europe and South-East Asia. He holds an MBA from INSEAD and a Masters from the London School of Economics. suppl y c ha i ndi gi ta l. com

ADORE ME

fashion industry and be more effi-

in terms of its procurement strategy.

cient with a better cost. Our cost of

“Our business model is not necessarily

shipment is now 70-80% lower than

fast fashion because we often see a

the benchmark in the industry. We

14-month time gap from product con-

empower them and make them oper-

ception until the product is delivered at

ate at a much higher efficiency.”

the warehouse,” explains Chang. “We

The COVID-19 pandemic has

spend time on sourcing the materi-

impacted organisations and industries

als as it’s essential that we have high

across the world. As a result, Chang

quality products. We’ve experienced

explains that Adore Me was forced

delays in shipping from Asia because

to adjust its mindset and processes

of COVID-19 and we’ve had to work

E X E C U T I V E P R O FILE :

Christina Chang Title: Product-to-Market Manager

Company: Adore Me

Industry: Fashion Christina Chang joined Adore Me in 2018. As Product-to-Market Manager, Christina is responsible for vendor management and sourcing strategy, as well as production and inventory management. Christina also collaborates with Adore Me’s IT developers in building proprietary tools to manage and streamline business processes. Prior to Adore Me, Christina worked in the financial services industry, first at AllianceBernstein and more recently at Morgan Stanley. She has also worked in strategy & operations at two consumer product startups. Christina holds an MBA from The Wharton School, University of Pennsylvania, and a BA from Columbia University. OCTOBER 2020

“ We’ve married able to leverage our partnerships two technologies with our manufacturers has been together to sort vital.” Shetty adds that Adore Me put a considerable amount of effort in its orders and logistics to better meet the challenge ensure the of COVID-19. “We tested a new set of robotic arms in order to keep our customer gets the operational rhythm up and running as perfect order” usual and allow our orders to get to our quickly to procure more inventory to

meet demand. Being nimble and being

— Nikhil Shetty, Supply Chain Manager, Adore Me

suppl y c ha i ndi gi ta l. com

ADORE ME

“ I believe being as agile and as nimble as we were during that tough time was one of our key strengths during the pandemic” — Christina Chang, Product-to-Market Manager, Adore Me 22

customers,” he says. “The logistics network was hit fairly bad because of a surge in sales and limited staff due to safety protocols which meant a delay in shipments. This seemed like a very good opportunity or a time for us to test out this new decentralised carrier system in the Northeast and allow next day delivery to our customers. I believe being as agile and as nimble as we were during that tough time was one of our key strengths during the pandemic.” OCTOBER 2020

Adore Me recognises the value of establishing key, strategic partnerships with companies to create mutually beneficial collaborations. Chang stresses how essential business relationships are in order to be successful in the industry. “We rely heavily on our manufacturing partners in Asia and across the world, because without them, we really wouldn’t be able to deliver high quality products to our customers,” she explains. “I believe the key for us has been cultivating partnerships with our manufacturers that are really meant for the long-term and can last. We want to grow with our partners and join forces on innovation, sustainability and establish that mutual trust to increase efficiency across the supply chain.” Chang affirms that the strength of Adore Me’s partnerships has really shone through during the COVID-19 pandemic. “Having that mutual support during this really difficult and challenging time has allowed us to go beyond the normal timelines and procure at a greater pace and without that backing, it would have been a lot harder,” suppl y c ha i ndi gi ta l. com

ADORE ME

E X E C UTIVE P R O FILE :

Nikhil Shetty Title: Supply Chain Manager

Company: Adore Me

Industry: Fashion Nikhil Shetty has a Masters in Engineering and Industrial Management at Syracuse University. Nikhil has had the opportunity to intern at both a Distribution Center and an early-stage healthcare startup in India. This instilled a love of startups and logistics, which helped him find the perfect combination at Adore Me. He oversees logistics networks and strategic sourcing of packaging. OCTOBER 2020

she explains. “When we’re seeking to

We have a very open and understand-

form a partnership, we’re searching

ing partnership and it has generated a

for partners that are aligned to our

lot of value. Asendia also places con-

strategy and can mutually grow with

siderable importance on sustainability,

us.” Liot points to its partnership with

which is incredibly important to us too.”

Asendia as a particularly important

With sustainability in mind, Shetty

relationship. “We’ve worked with

affirms that Adore Me is committed to

Asendia for several years and we

its sustainability goals and has under-

challenge them every year,” explains

taken several initiatives to achieve a

Liot. “Asendia have shared values

more environmentally friendly packag-

with us and acknowledge when things

ing output. “We now have an ecomailer

aren’t perfect and are always willing

which is made up of recycled content

to work with us to make things better.

and can be recycled. We’re using suppl y c ha i ndi gi ta l. com

ADORE ME

OCTOBER 2020

smarter materials to leave a smaller carbon footprint, while also reducing the logistical footprint too.” Looking to the future, Liot believes the fashion industry will have to change and believes it will transform in three directions. “The industry will become more digital across all platforms. There will be a digitalisation in the supply chain and in operations which will be essential and will leave organisations with no choice,” he says. “Secondly, sustainability will become more influential and prominent in everyday operations. As climate change continues to have an effect and impact, it will be imperative to reduce the carbon footprint. Lastly, there will be a change in globalisation. I believe there needs to be a much shorter cycle and I expect there will be a geographical shift in the coming years.”

suppl y c ha i ndi gi ta l. com

S U P P LY C H A I N

DIGITALISATION IN SUPPLY CHAIN POST-COVID -19 WRITTEN BY

SEAN GALEA-PACE

OCTOBER 2020

suppl yc ha i ndi gi ta l. com

S U P P LY C H A I N

Bob Murphy, CPO at IBM, discusses digital transformation and the effect COVID-19 has had on his organisation’s operations and the wider industry

BM is a global technology company with a leading cloud platform. Founded in 1911, it has become the largest technology and

consulting employer globally, with more than

350,000 employees serving clients in 170 countries worldwide. Bob Murphy is the Chief Procurement Officer at IBM. With over 40 years in the industry, Murphy is a highly experienced procurement executive and has overseen the rise of digital transformation first-hand in the industry. “For IBM, as well as for many other companies who have progressed on this journey, the transformation of procurement has been driven by innovation,” explains Murphy. “The innovation of technology has played a huge role in our transformation, as we initially moved from manual to electronic processes and systems. In recent years, the introduction of technologies like cloud, AI, advanced analytics, blockchain and RPA have enabled procurement to reach new OCTOBER 2020

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“ For IBM, as well as for many other companies who have progressed on this journey, the transformation of procurement has been driven by innovation” — Bob Murphy, CPO, IBM

levels of digitisation and automation — allowing us to offer faster and simpler solutions to our clients, higher cost savings and increased strategic value to our companies. The biggest innovation may be with regards to our people. Along with improving the procurement processes and harnessing these new technologies, we’ve transformed the procurement professional into someone who has the tools and skills to deliver increasingly higher value outcomes for their clients. They are armed with insights from data they couldn’t previously access, and proactively offering strategic consulting to their stakeholders and clients — a big change from their role in the past.” The COVID-19 pandemic has disrupted supply chains on a worldwide scale. Murphy explains that while it’s normal for IBM to monitor supplier status closely through its global management system, the firm did enhance its processes and communication further during the pandemic as it monitors changes in demand and assesses lines of supply, commitments, logistics and contingency plans. “This pandemic is unprecedented in scope and scale suppl yc ha i ndi gi ta l. com

S U P P LY C H A I N

IBM & COVID-19: Today isn’t a restart. It’s a rethink. CLICK TO WATCH | 2:10

“ The innovation of technology has played a huge role in our transformation, as we initially moved from manual to electronic processes and systems” — Bob Murphy, CPO, IBM

and has affected all geographies, sectors and industries,” he explains. “At IBM, we’re fortunate that we already had the technologies and processes in place to handle crises such as natural disasters and pandemics, which was a great help. We have also been working with suppliers across the globe to source new products and services from new suppliers that we couldn’t have anticipated. For example, we have been sourcing masks and sanitizer for the last several months to get us through the various phases of returning to the office that are ahead

OCTOBER 2020

of us. We also implemented dedicated

ensure their safety and well-being

freight carrier lanes to maintain deliv-

with frequent contact, surveys, and

ery routes and have been pre-booking

employee assistance programs,” says

flight space to secure shipping capac-

Murphy. “While many of us are used to

ity. On the payables side, we executed

working from home now and then, over

urgent accounts payable supplier

80% of our procurement profession-

setups and expedited payments for

als have never done so on a regular

business-critical requirements.”

basis. Yet our procurement outsourc-

IBM’s strategy for managing the

ing service delivery organisation, for

impact of the coronavirus was to pri-

example, was able to move 99% of the

oritise its employees’ wellbeing and

staff from working onsite to work-from

safety. “We enabled our workforce to

home within 10 days back in mid-

work from home with secure tools and

March, which was pretty remarkable.

technology; and we work to continually

We were able to achieve that because

suppl yc ha i ndi gi ta l. com

S U P P LY C H A I N

most of our staff already had laptops and remote access to IBM systems so we just needed to get access to the client systems they supported. We already embrace collaborative tools because we are a geographically diverse organisation that values innovation and technology. But some of the changes we did need to make were to hold more frequent meetings and to have more one-one-one time with our employees to ensure they had what they needed to remain productive as 36

well as to ensure their well-being.” Murphy believes that in the aftermath of COVID-19, it’s important to reimagine supply chains and navigate disruption through risk mitigation, visibility and insights. “Instead of basing your supply chain design on the assumption that materials flow freely globally, enabling you to source, produce, and distribute products at the lowest-cost locations around the world, consider what we learned from COVID-19 — unforeseen events can trigger major disruption to entire supply chain networks,” says Murphy. “Opportunities for supply chain transformation exist across the value chain, OCTOBER 2020

“ Our procurement outsourcing service delivery organisation, for example, was able to move 99% of the staff from working onsite to work-from home within 10 days back in mid-March, which was pretty remarkable” — Bob Murphy, CPO, IBM

from demand planning and manufacturing execution to order orchestration and fulfillment. Understanding supply chain risks requires gaining visibility into tier 2 and tier 3 suppliers that, despite their relatively small size, can quickly and significantly disrupt production. With smarter supply chain modeling and scenario analysis we can get an immediate assessment and continued evaluations for risk mitigation. Analytics, AI, and visualisation suppl yc ha i ndi gi ta l. com

S U P P LY C H A I N

tools allow us to assess geopolitical

While Murphy recognises it’s impos-

risks, climate change risks, cyber secu-

sible to predict exactly what the future

rity risks, and natural disasters. We can

will hold, work is already underway to

proactively identify alternate sources

build a smarter global supply chain.

wherever possible, test and contract

“Organisations can leverage artificial

multiple logistics routes, and maintain

intelligence (AI) and other technolo-

the flexibility to reposition inventory

gies – such as automation, blockchain,

across their supply chains.”

IoT, 5G, and edge computing – to help

OCTOBER 2020

technologies can help maintain busi-

“ I get excited when I look to the future, as I know we’re not done yet” — Bob Murphy, CPO, IBM

ness continuity during these times of disruption and uncertainty.” Murphy remains optimistic for the future of IBM. “I get excited when I look to the future, as I know we’re not done yet,” he affirms. “IBM’s journey to becoming the Premier Cognitive Procurement Enterprise is about automating the end-to-end procurement workflow and deriving proactive alert-driven insights across the board. We’re working towards deploying this automation and intelligent workflows throughout procurement, and then also integrating that with the rest of IBM and with our external ecosystem of suppliers and clients. I’m focused on driving that for the IBM enterprise, but also as we progress, I’m committed to sharing what we learn and develop with others who are interested.”

turn the unanticipated into the envisioned,” he says. “Systems based on these exponential technologies can help organisations build smarter supply chains and reduce vulnerabilities from unforeseen circumstances like this. Smarter supply chains that leverage the power of AI and other emerging suppl yc ha i ndi gi ta l. com

L O G I S T I C S - D R O N E S & AV G S

The rise of Drones in Supply Chain Post-COVID-19 WRITTEN BY SEAN GALEA-PACE

OCTOBER 2020

suppl yc ha i ndi gi ta l. com

L O G I S T I C S - D R O N E S & AV G S

Tim Bridges, Global Head of Consumer Goods and Retail at Capgemini, discusses the influence of drones and AGVs as a result of COVID-19 Q. As a way of introducing yourself, can you start off by telling us a bit about your career and your journey to finding yourself with Capgemini? A. “I lead Capgemini’s Consumer Goods and Retail global sector practice – a portfolio which includes 42

major global retail, fashion, restaurant, consumer products, transportation, and distribution brands like McDonald’s, Coca-Cola, Meijer, Office Depot, Domino’s, and Unilever. I’ve been with Capgemini for over 20 years and was previously a partner at EY, where I created and led the Structured Lending practice for blue chip clients in the financial services and lending capital industry.” Q. How would you describe Capgemini? What gives it an edge over competitors? A. “Capgemini is at the forefront of innovation to address the entire breadth of our clients’ opportunities in the evolving world of cloud, digital and platforms. We harness the power of data-driven insights to help brands compete against

OCTOBER 2020

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“ The future of robotics and automation in the supply chain will feature self-orchestration” competitors, engage customers,

Q. What does digital transformation

enter new markets and, ultimately,

currently look like in the supply

positively disrupt the world we live in.

chain industry today?

We’re also a company which is actively

A. “COVID-19 has heightened the

pursuing a positive future for our

frailties of many supply chains. A lack

company, clients and wider society.

of visibility and agility has brought

Sustainability, digital inclusion and

many firms to a literal stand-still. Last

inclusivity are central to our values.”

year, Capgemini research found that suppl yc ha i ndi gi ta l. com

L O G I S T I C S - D R O N E S & AV G S

Capgemini’s Demand Planning Supply Chain Solution CLICK TO WATCH | 2:24

46 just 14% of organisations had scaled

The goal is to create a single, end-to-

their pilot plans to digitise their supply

end, unified view of the ecosystem

chain, with 86% still at the pilot stage.

so that organisations have precise,

In the wake of the pandemic, innova-

real-time visibility into their opera-

tion has become an imperative. Recent

tions – from the suppliers of materials,

events have shown us it is impossible

the transporters of those supplies and

to plan for what’s coming next, so

finished goods, and finally to the cus-

adaptability is critical. This can only

tomers demanding fulfillment.”

come about from digitalisation, which will give organisations the effective-

Q. How has automation and robotics

ness, transparency and resilience

transformed supply chains?

they need.

A. “Most supply chain organisations

“Firms need to move away from lin-

already use some form of robotic pro-

ear, traditional supply chain models to

cess automation (RPA), particularly in

become connected, supply networks.

areas that are high-volume, repetitive

OCTOBER 2020

and rule-based like orders and claim

for pick-pack-ship activities and

processing. RPA software bots can

self-driven trucks for logistics.”

monitor inventory, generate notifications and reorder products when

Q. What are the real benefits to using

levels go below a set threshold, freeing

drones in logistics? How were drones

up time and resources for people to

and Automated Guided Vehicles

work on high-value exception-based

(AGVs) considered in the industry

requirements.

pre-COVID and what do you feel their

The future of robotics and automa-

future looks like in the supply chain?

tion in the supply chain will feature

A. “Pre-crisis, 97% of retailers felt their

self-orchestration. Radio-frequency

delivery models were not sustain-

identification (RFID) and GPS are

able. Consumers want fast and cheap

not new, but, as artificial intelligence

deliveries, but this is hard for organisa-

and 5G mature, so do the use cases

tions to deliver while making a profit.

for these technologies: examples

Drones have huge potential as a last

include using autonomous robots

mile resource because they reduce

suppl yc ha i ndi gi ta l. com

L O G I S T I C S - D R O N E S & AV G S

the need for human intervention and are exceptionally fast. They can also reach isolated locations which are tricky to get to via traditional vehicles – potentially opening up new customer bases. Drones have been experimented with over the years as a delivery option by the likes of Amazon and Walmart. However, airspace restrictions and concerns about drones crossing over flight routes meant they have never taken off – until now. 48

“COVID-19 spurred the world’s first drone delivery service into existence in Ireland and we’ve seen more players utilise this delivery method in the wake of the pandemic[1]. If these test deliveries are successful, logistically possible on a wider scale and public opinion of their use is positive, we may see restrictions around drones eased, leading them to become a viable device for remote orders. While this may not be the future of delivery on a mass scale, drones do offer an interesting solution to ongoing issues of social distancing and the overwhelming levels of demand.”

OCTOBER 2020

“ Our focus has been to help our clients build resilience – quickly – through digitalisation”

Q. Can you talk me through your COVID-19 approach? What kind of impact did it have in the industry and how are drones and AGVS being used? A. “Many of the challenges that companies faced at the beginning of the pandemic were not solely the result of the virus. It was more that the sudden change in working conditions and increase in demand put a spotlight on pre-existing issues. Our focus has been to help our clients build resilience – quickly – through digitalisation. By helping organisations to enhance immediate supply chain visibility, adopt emerging technologies to limit disruption, and rethink supply chain strategies, we are protecting them in the short-term while setting them up for long-term success.” Q. What are the major trends you are observing in the industry and how is your business responding to them? A. “Building resilience is a critical theme, as is sustainability. We found that 79% of consumers are changing their purchase preferences based on social responsibility, inclusiveness, suppl yc ha i ndi gi ta l. com

L O G I S T I C S - D R O N E S & AV G S

“ We found that 79% of consumers are changing their purchase preferences based on social responsibility, inclusiveness, or environmental impact, and this trickles down to the supply chain too” or environmental impact, and this

sustainable through initiatives like

trickles down to the supply chain too.

waste reduction, energy efficiency

For these organisations, there is a

and using more sustainable materials.

huge onus to make practices more

Many manufacturers and retailers are

OCTOBER 2020

Q. What’s next for the Consumer Goods and Retail sector at Capgemini? A. “Capgemini recognises that service needs and solutions vary by subsector. For example grocery is looking for fast progression in both contactless commerce of consumer engagement as well as profitable fulfillment, while apparel looks to restructure as well as find direct to consumer (DTC) solutions. “Capgemini is evolving and applying specific solution and service emphasis to drive tailored client needs. We’re also helping organisations to develop what we call invisible infrastructure – operating models that are agile, fluid worried that implementing sustain-

and adaptable. In line with this, we see

able approaches is too costly, but

simplification as a key theme for our

technology is opening new frontiers

clients. Emerging technologies like

to manage and scale up sustainability

5G and Internet of Things (IoT) can

initiatives while boosting revenue and

seem overwhelming to business and IT

reducing operational costs. More

leaders, but through simplification, we

importantly, they may find that the

look at real-world use cases for these

price of not pursuing these aims may

technologies, making them tangible

also cost them dear.”

and exciting for our clients.”

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T E C H N O L O G Y - D I G I TA L T W I N S

OCTOBER 2020

The Evolution of Digital Twins in Supply Chain 53 WRITTEN BY SEAN GALEA-PACE

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T E C H N O L O G Y - D I G I TA L T W I N S

Supply Chain Digital explores the influence of digital twins and how the technology is leveraged in a supply chain setting

he supply chain of today is unrecognisable

from a decade ago. As a direct result of the influence of technology, supply chains are

complex and dynamic, and it has never been so

important to adopt an agile approach. With the added challenge of COVID-19, having 54

real-time data available is a critical competitive advantage. Industry 4.0 constitutes a technological framework that focuses on digitalisation and analytical capabilities to identify events on a realtime basis. This is where digital twins come in. A digital twin is essentially a virtual supply chain replica that consists of hundreds of assets, warehouses, logistics and inventory positions, and it is gaining more attention in the industry due to improvements in technical and computational capabilities with operations technology. Ravi Gopinath, Chief Cloud Officer and Chief Product Officer at AVEVA, believes the value of digital twin technology is directly proportional to the reliability and depth of the data powering the underlying model; such as operating data, OCTOBER 2020

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Redefine customer relationships with artificial intelligence Get actionable insights and deliver highly personalized engagement using an AI-powered CRM.

“ Digital twins have been a key force behind the improvements in supply chains and the digitalisation of industries has increased margins and operational performance in good times, whilst allowing industries to adapt better in the bad” — Ravi Gopinath, Chief Cloud Officer and Chief Product Officer, AVEVA production data or supply chain 57

data. “Digital twins support the entire lifecycle, from design time, through construction and commissioning, all the way through to operations,” says Gopinath. “While there is value in just collecting current and historical data for analytics, the real power of the digital twin is realised when it covers the full asset lifecycle. This makes it a single repository for the information needed by both the operations and maintenance of a plant or an organisation’s supply chain. In addition, this critical engineering and operational data enables the use of big data analytics, such as planning, optimisation and predictive analytics.” suppl yc ha i ndi gi ta l. com

T E C H N O L O G Y - D I G I TA L T W I N S

“Ultimately, digital twins have been

global supply chains and the domino

a key force behind the improvements

effect of lockdowns was second to

in supply chains and the digitalisation

none,” says Murthi. “Now, businesses

of industries has increased margins

must prepare for what could be further

and operational performance in good

lockdowns countrywide and regionally,

times, whilst allowing industries to

as well as for the threat of a second

adapt better in the bad.”

wave. We have been through this once

Vikram Murthi, Vice President,

before and businesses have to pre-

Industry Strategy at LLamasoft,

pare to respond to the inherent risks

believes that COVID-19 has show-

in their supply chains, with strategies

cased how underprepared companies

to be more resilient and continuously

were for such a disruption. “There

respond as demand patterns changes

have been events over the years that

and supply issues occur.”

have impacted supply chains, but the

Murthi recognises that through

scale at which COVID-19 affected

digital twins, businesses will be able

Introduction to Digital Twin: Simple, but detailed CLICK TO WATCH | 7:18

OCTOBER 2020

to understand the impacts and trade-

considerations – this model is

offs of decisions by running ‘what-if’

referred to as the digital twin,” he

scenarios and making informed rec-

explains. “The digital twin with AI,

ommendations both horizontally and

machine learning and optimisation

vertically throughout the supply chain.

techniques can be used to simulate

“The supply chain system is a complex

and optimise the supply chain. The

network of entities which needs an

digital twin encapsulates suppliers,

end-to-end representation that can be

factories, contract manufacturers,

leveraged to respond to market pres-

distribution facilities, transportation

sures, external factors and internal

lanes and customer locations. Using suppl yc ha i ndi gi ta l. com

T E C H N O L O G Y - D I G I TA L T W I N S

S T E V E T R E A G U S T, V I C E PRESIDENT OF INDUSTRIES P R O G R A M M A N A G E M E N T, I F S

“If an organisation is a collection of people managing operations for a collective goal, then the digital twin of an organisation (DTO) is the automation of the inputs, calculations and outputs of the same processes, but without physical assistance or constraints. “Within an Enterprise Resource Planning (ERP) context, the digital twin covers the processes which are prevalent within the ERP system and can utilise the existing ‘actual’ values and ‘actual’ calculations where appropriate. The benefits of this are that setup and maintenance of the DTO is quicker and more accurate, and the data security is the same as that used within the ERP. “With a DTO in place across an organisation, operational simulations can be run to determine

OCTOBER 2020

outcomes throughout the processes. The benefits of using DTOs to run operational simulations is that not only are the decisions evident at each calculation point, but requirements in terms of capacities are also determined and the supply chain can be prepared to deliver the required capacities. The other benefits are that decisionmaking becomes more familiar with decisions being made backed by the scenario planning. “Of course, DTOs do come with challenges. Simulations are based on static processes, with system-based data and calculations, which if inaccurate only seek to extrapolate into inaccurate results. Also, there are only so many simulations that can be planned, which is why a range of outputs and inputs is the best outcome.”

the digital twin, businesses can

technology, businesses are finding

evaluate the complex interconnected

new ways to ensure operations are

trade-offs in capacity, service, inven-

running as they did pre-pandemic.

tory and total landed cost.”

Most recently, we have seen a surge in

Jonathan Bailey, Director of

digital twin technology, to not only help

Business Transformation, EuroNorth

address immediate business needs,

at Dassault Systèmes, has observed

but to future-proof and help build resil-

first-hand how businesses trans-

iency for the long-term.”

formed their operations almost

“Dassault Systèmes has been instru-

overnight, which has aided the rise of

mental in developing and leading these

digital twin technology. “Society has

capabilities since its infancy; we used

come a long way in the last six months

it to help support the creation of the

during the COVID-19 pandemic,” says

Boeing 777 plane as early as 1989,”

Bailey. “From the implementation

adds Bailey. “Implementing digital

of artificial intelligence to simulation

twin solutions means that whether it

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T E C H N O L O G Y - D I G I TA L T W I N S

“ The scale at which COVID-19 affected global supply chains and the domino effect of lockdowns was second to none” — Vikram Murthi, Vice President, Industry Strategy, LLamasoft is used by aircraft designers or manu-

matches the needs of what is hap-

facturers, you have full visibility of the

pening day to day and experiment in

entire production process. Using this

the virtual world to see how the parts

real-time data, you can ensure what

fit and perform together. This limits

is happening in your supply chain

time spent on manufacturing and

OCTOBER 2020

Short-term planning and execution: A digital twin can identify execution risks early and this means that companies can mitigate risks rather than manage crises. It enables the company to reduce the idle time of bottleneck assets and improve inventory positions. Sales and operations planning: The digital twin can optimise sales and operations planning (S&OP) by simulating the execution of a specific plan, highlighting risks

and opportunities and feeding the insights back into the planning process. This allows the company to

getting the parts delivered for assem-

minimise the losses that arise from

bly, and the testing phase. Digital twins

misalignment of plans and system

are also widely used in the automotive

constraints, as well as latent bot-

sector precisely for this reason.”

tlenecks. The insights also allow

Digital twins help companies

the company to better align mainte-

address challenges by simulating

nance plans and inventory build ups

all assets and interconnections in

with market demand.

a complex supply chain. In BCG’s

Longer-term planning: A company

report “Conquering Complexity in

can improve the efficiency of capex

Supply Chains with Digital Twins”,

and optimise the setup of the overall

it was detailed how a company

supply chain system by understand-

can apply the insights to augment

ing where the most significant

decision-making across multiple

structural bottlenecks exist and how

planning horizons.

much additional capacity is needed. suppl yc ha i ndi gi ta l. com

T E C H N O L O G Y - D I G I TA L T W I N S

“ We have seen a surge in digital twin technology, to not only help address immediate business needs, but to future-proof and help build resiliency for the long-term” — Jonathan Bailey, Director of Business Transformation, EuroNorth, Dassault Systèmes It is important that for any technology deployment that the effort to introduce 64

a digital twin is led by the business. Companies that clearly understand the value potential and opportunities to gain an edge will be in the best position. For example, by better understanding and protecting bottleneck assets in the supply chain, a company can increase throughput, improve service levels and react faster to changes

• Leveraging a data and digital plat-

in its sales portfolio. According to BCG,

form in order to release data from core

to create sustainable change, com-

IT systems and quickly build analytics-

panies should address three enablers

based minimum viable products.

from the start: • Changing processes so that they

Ultimately, Murthi believes that the

can effectively use the new insights.

‘winners’ are the companies that are

• Building up the required capabilities

proactive and agile. “From a recent

and changing the way of working.

LLamasoft retail research report, the

OCTOBER 2020

most successful retailers are those

will be using AI, advanced analytics

that are already recognising and

and IoT in supply chain operations.

implementing technologies such as

If businesses are to survive and thrive

digital twins, artificial intelligence and

in the new normal, they must imple-

machine learning – they are the ones

ment the right enabling technology

that are staying ahead of the curve in

that will help them gain insights into

tough times,” he explains. “As stated

their supply chains and make them

in the 2019 Gartner report, by 2023 at

more agile to respond to rapidly

least 50% of large global companies

changing conditions.” suppl yc ha i ndi gi ta l. com

T O P 10

Supply Chain Executives 66

We examine 10 of the leading supply chain executives in the industry, ranked by company revenue.

WRITTEN BY

SEAN GALEA-PACE

OCTOBER 2020

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T O P 10

NEW YORK, UNITED STATES

$15.5bn REVENUE IN US$ DOLLARS

34,500 NUMBER OF EMPLOYEES

Michael Corbo Chief Supply Chain Officer, Colgate Palmolive

Corbo is an experienced Chief Supply Chain Officer with a comprehensive history in the consumer goods industry. He has spent his entire career with Colgate, working across a variety of different positions. He is skilled in negotiation, operations management, supply chain optimisation, consumer products and demand planning. Corbo is currently leading Colgate Palmolive’s transformation to a digital supply chain.

OCTOBER 2020

Ivanka Janssen

Senior Vice President, Global Integrated Supply Chain, Philips

Janssen is an experienced supply chain leader with more than 20 years of international management experience in operations, manufacturing, supply chain, route to market, logistics, customer service and procurement. She is the Senior Vice President of Global Integrated Supply Chain at Phillips and is focused around creating a competitive edge. Prior to her role at Philips, she served as Vice President of Supply Chain, Europe, Eastern Europe and Sub Saharan Africa at PepsiCo. 69

AMSTERDAM, NETHERLANDS

$21.4bn REVENUE IN US$ DOLLARS

77,400 NUMBER OF EMPLOYEES

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T O P 10

AMSTERDAM, NETHERLANDS

$23.5bn REVENUE IN US$ DOLLARS

53,000 NUMBER OF EMPLOYEES

Dirk Holbach

Corporate Senior Vice President, Chief Supply Chain Officer, Henkel

Holbach is the Corporate Senior Vice President and Chief Supply Chain Officer, Laundry & Home Care at Henkel Global Supply Chain. He has over 20 years of experience in supply chain, operations, purchasing and sales, having held a number of roles on a local, regional and global level at Henkel. Holbach’s special focus has been on supply chain strategy and organisational development, network optimisation, continuous improvement and post-merger integrations. Holbach holds a master’s degree in business and mechanical engineering and a PhD in information science.

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T O P 10

BAGSVÆRD, DENMARK

$19.4bn REVENUE IN US$ DOLLARS

42,100 NUMBER OF EMPLOYEES

Susanne Hundsbæk-Pedersen Senior Vice President - Devices and Supply Chain Management, Novo Nordisk

Hundsbæk-Pedersen is the Senior Vice President of Devices and Supply Chain Management. In her role, Hundsbæk-Pedersen is responsible for the global end-to-end supply chain management operations ranging from the procurement function across manufacturing planning and the distribution to 70 global affiliates serving 170 countries. She is also responsible for manufacturing development of assembly and packaging operations across her organisation’s global sites.

OCTOBER 2020

Mourad Tamoud Chief Supply Chain Officer, Schneider Electric

Tamoud is the Chief Supply Chain Officer at Schneider Electric. He has worked at Schneider Electric in a variety of different roles over the past 24 years, holding positions in Low Voltage and Medium Voltage Industrial Operations, Industrial Strategy, Manufacturing Logistics, Production & Logistics, Procurement, and ERP Information Systems. Tamoud has a passion for the customer and is well versed in how supply chains must evolve in the future to serve as growth engines and keep Schneider competitive. He has a degree from Institut National Polytechnique de Grenoble. 73

RUEIL-MALMAISON, FRANCE

$32.2bn REVENUE IN US$ DOLLARS

135,000 NUMBER OF EMPLOYEES

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T O P 10

BRENTFORD, UNITED KINGDOM

$44.1bn REVENUE IN US$ DOLLARS

99,437 NUMBER OF EMPLOYEES

Regis Simard

President, Pharmaceutical Supply Chain, GSK

Simard is the President, Pharmaceuticals Supply Chain at GSK. In his role, he is responsible for the manufacturing and supply of GSK’s pharmaceutical products, including innovative new machines, and he leads Quality and Environment, Health, Safety & Sustainability (EHSS) at a corporate level. Prior to joining GSK, Simard held leadership positions at Sony and Konica-Minolta and also at Tyco Healthcare where he gained valuable experience working with Japan, UK and France. He is also a mechanical engineer and holds an MBA.

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T O P 10

Thomas Panzer SVP, Head of Supply Chain Management, Bayer AG

Panzer serves as Senior Vice President and Head of Supply Chain Management for the Pharmaceuticals division of Bayer AG. In this role, it includes overseeing the supply of all pharma products including launch management for all three technological areas of small and large molecules and medical devices. Panzer’s department oversees the planning and execution of Bayer’s supply chain network from end-to-end within the organisation and is accountable for the inventories, S&OP/IBP, risk management as well as being the key interface partner for our commercial and marketing organisation. 76

BERLIN, GERMANY

$51.5bn REVENUE IN US$ DOLLARS

103,824 NUMBER OF EMPLOYEES

OCTOBER 2020

CALIFORNIA, UNITED STATES

$51.9bn REVENUE IN US$ DOLLARS

75,900 NUMBER OF EMPLOYEES

John Kern

Senior Vice President, Cisco Systems

Kern is Senior Vice President of Supply Chain Operations at Cisco where he leads a global and diverse team responsible for manufacturing, new product introduction, product lifecycle management, sourcing and supplier management, planning, logistics and product quality. Kern has led the efforts to digitise Cisco’s supply chain as well as evolve the practice to accelerate Cisco’s business model evolution, building the capabilities required to enable Cisco’s growth in software and cloud delivered solutions. Kern is also leading Cisco’s circular economy effort and is serving as the executive country sponsor for India and Brazil.

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E M E A | A P A C | | APAC N O R T H | A EMEA MERICA AMERICAS FIND OUT MORE

FIND OUT MORE

T O P 10

Marc Engel Chief Supply Chain Officer, Unilever

Having worked at Unilever for over 20 years, Engel has extensive experience in supply chain operations, covering procurement, logistics, finance and strategy development. Before being appointed Chief Supply Chain Officer, Engel had an executive leadership role in Unilever’s East Africa business where he was responsible for laying the foundations for accelerated growth. He has an MSc in applied physics from the University of Groningen in the Netherlands. 80

Investor Event 2019 - Marc Engel CLICK TO WATCH | 44:35

OCTOBER 2020

LONDON, UNITED KINGDOM

$61.5bn REVENUE IN US$ DOLLARS

155,000 NUMBER OF EMPLOYEES

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T O P 10

NEW JERSEY, UNITED STATES

$82bn REVENUE IN US$ DOLLARS

132,200 NUMBER OF EMPLOYEES

Hub Culture Davos 2019 - Kathy Wengel, Executive VP of Johnson & Johnson CLICK TO WATCH | 9:46

OCTOBER 2020

Kathryn Wengel Executive Vice President and Chief Global Supply Chain Officer, Johnson & Johnson

Wengel is Executive Vice President and Chief Global Supply Chain Officer at Johnson & Johnson. She leads all aspects of the Johnson & Johnson Supply Chain across its three business sectors: Consumer Health, Medical Devices and Pharmaceuticals. Wengel has a passion for building globally diverse teams and is also a Chairman of the Board of GS1 Global, an organisation that sets and maintains standards regarding the exchange of critical business data. In 2019, Wengel was recognised on the Council of Supply Management Professionals (CSCMP) with their Distinguished Service Award, the top cross-industry supply chain honor for individuals, and was inducted into the Supply Chain Hall of Fame.

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Driving value-added technology in manufacturing WRITTEN BY

GEORGIA WILSON PRODUCED BY

CAITLYN COLE

OCTOBER 2020

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TWINTHREAD

Erik Udstuen, CEO at TwinThread discusses digital innovation, realizing value and the current technology trends in the manufacturing industry

orking in the industrial automation and manufacturing space for 25 years, Erik Udstuen began his career as a chemi-

cal and process engineer working in the pulp and paper industry, before forming his own company in the early nineties providing customers with manufacturing optimization solutions for multiple 86

sectors. After selling the company to General Electric (GE) in 2003, Udstuen joined the firm in 2007 as a Senior Executive driving digital transformation across multiple business units. “I left GE in 2012 and went back into the startup world and formed a couple of other companies, the latest company is TwinThread,” comments Udstuen, who believes that a significant differentiator between TwinThread and other organizations is its results guaranteed position. “The idea of TwinThread is to provide similar capabilities and concepts that monitor and optimize a fleet of power plants or gas turbines to other industries like manufacturing, consumer products, food and beverage, and automotive. The enabler for this is the fact that we have these pre-built applications that someone can just take, apply and OCTOBER 2020

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TWINTHREAD

With this in mind, when it comes to digital innovation, TwinThread’s vision is “to be able to optimize on a global basis and drive 1 or 2% more efficiency out of manufacturing operations or a network of assets,” adds Udstuen. In order to achieve this he further explains that “the enabler is algorithms and the power of technology such as machine learning to make that practi-

gain valuable insights without having

cal. We have a customer, for example,

to go through a long deployment.

that is monitoring 450 data centers

“We embrace the opportunity to

across the world and they’re doing that

deploy pilot projects that deliver proof

with just a few people. The only way

of value for outcomes and that as well

that becomes practical and economi-

is very unique. In doing so, we want to

cally feasible is if you apply algorithms

roadmap and fund future opportunities

and machine learning technologies.

for our customers.”

With these capabilities, organizations

“It may be a bit of a cliche, but really the executive buy-in sponsorship commitment to any kind of digital transformation effort is essential” — Erik Udstuen, CEO, TwinThread

OCTOBER 2020

can drive innovative opportunities to

terms of the culture and mindset

drive efficiency.”

in this new digital age, and with the

When it comes to deploying a digi-

incorporation of machine learning

tal strategy, Udstuen highlights the

and artificial intelligence technolo-

importance of having the right culture

gies, leaders have to think in terms of

and mindset. “It’s critical. It may be a

their change management strategy

bit of a cliche, but really the execu-

- how do you bring together the roles

tive buy-in sponsorship commitment

of the IT teams, the data scientists

to any kind of digital transformation

and the engineer to understand the

effort is essential. But maybe what

data and solve business problems

potentially is less obvious is that in

using digital technology.” suppl y c ha i ndi gi ta l. com

TWINTHREAD

“ With the advancement of innovative technology such as machine learning, cloud computing, artificial intelligence (AI) and 5G, the concept of connected environments are becoming more and more feasible and in real-time” — Erik Udstuen, CEO, TwinThread

TwinThread - Digital Innovation CLICK TO WATCH | 1:53

OCTOBER 2020

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TWINTHREAD

Within the industry, Udstuen

implementing artificial intelligence

explains that when it comes to the

and machine learning based tech-

importance of technology, ‘we’re

nologies. But, only 16% actually have

obviously very biased given that we’re

a program that’s deploying that

a technology company, focused on

technology. So there’s a huge gap

applying machine learning and artificial

between the desire and the people

intelligence technologies. However,

that are actually implementing.

in a recent Harvard business review

The trends in terms of the applica-

article, it was suggested that 84%

tion of that technology are clear,

of leaders believe they should be

but the trends of how to actually

OCTOBER 2020

get moving and start deploying that

began investing in sensor technology,

technology, those trends are only just

the technology to record the data

emerging.” Udstuen also highlights

from the sensors and the technology

that within that article, it was refer-

to store the data for long periods of

enced that successful companies

time. In the mid two thousands this

that are applying this technology are

expanded into most industries which

doing two key things. “One is the use

means that there are billions of sen-

of cross functional teams, and the

sors that have been deployed and

other is making the commitment and

are collecting data.

adopting technology in production as a first step.”

Today, the concept of connected factories and fleets is to mine new

Other trends within the industry

insights from not only the informa-

seen by Udstuen include the concepts

tion that’s already been collected,

of connected factories, connected

but also new data being created.

fleets and predictive maintenance.

With the advancement of innovative

“Starting with manufacturing there

technology such as machine learning,

are multiple innovations and layers

cloud computing, artificial intelligence

to the technology, some are new and

(AI) and 5G, the concept of connected

some have been around for a while.

environments are becoming more

In the mid nineties, organizations

and more feasible and in real-time.”

“ There’s a lot of value in looking backwards and understanding what went wrong and what went right, but it is a whole new level of value to be able to look forward and anticipate problems” — Erik Udstuen, CEO, TwinThread suppl y c ha i ndi gi ta l. com

TWINTHREAD

94 E X E C U T I V E P R O FILE :

Erik Udstuen Title: CEO

Company: TwinThread

Industry: Internet

Location: Charlottesville, Virginia

Erik’s in-the-field industrial experience working as a chemical and process engineer, paired with his proven acumen for co-founding successful tech. start-ups is what fuels his passion for developing and driving innovative, game-changing solutions specifically tailored for manufacturing organizations committed to ever-improving efficiency and performance. His 25 years in the manufacturing sector have equipped him with the background necessary to know exactly what it is engineers, operators, problem-solvers and domain experts need. They need a predictive platform that will cater insights to their understanding, so they may be unleashed to expand their reach and effect greater operational change. OCTOBER 2020

TwinThread - Trends in the Industry CLICK TO WATCH | 2:55

95 Another part of TwinThead’s vision

the problems might be, and to be able

is that “a modern operating strategy

to act before those problems manifest

should be one where a company can

themselves. There’s a lot of value in look-

optimize their entire enterprise of assets

ing backwards and understanding what

efficiently. It’s no longer about optimizing

went wrong and what went right, but it is

a single plant or a single line. It’s about

a whole new level of value to be able to

how to optimize the performance of all of your assets and do that efficiently. This is where predictive maintenance comes in. It’s one thing to be able to look backwards and say, these were the problems that I had and this is how I applied these resources enabling me to solve the problem. It’s another to be able to look forward and to anticipate where

2018

Year founded

30+

Number of employees suppl y c ha i ndi gi ta l. com

TWINTHREAD

“ A modern operating strategy should be one where a company can optimize their entire enterprise of assets efficiently, it’s no longer about optimizing a single plant or a single line” 96

— Erik Udstuen, CEO, TwinThread

TwinThread - Future Innovations CLICK TO WATCH | 4:09

OCTOBER 2020

look forward and anticipate problems

blocks, and actually create applica-

and to have strategies in place, to deal

tions out of them so that customers

with problems in real-time in a proactive

can just deploy the application that

and predictive way,” comments Udstuen.

solves the problem without having to

Reflecting on the future, Udstuen

conduct the development work based

believes that from a TwinThread per-

on a tool set. This helps to eliminate

spective what the company is trying to

the development time so that custom-

continuously achieve, “is that with any

ers can get straight to deploying and

adoption of technology, an organiza-

straight to getting value.”

tion requires a tool set to do their own development work, in order to turn the technology into an actual application that delivers value. So what we’re trying to drive is the ability to take those building suppl y c ha i ndi gi ta l. com

Lufthansa Cargo: Accelerating Digital Amid COVID -19 98

WRITTEN BY

SEAN GALEA-PACE PRODUCED BY

LEWIS VAUGHAN

OCTOBER 2020

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LUFTHANSA CARGO

Jochen Göttelmann, Chief Information Officer, and Boris Hueske, Head of Digital Transformation at Lufthansa Cargo, discuss the rise of digital in air freight

ufthansa is one of the world’s most renowned airlines. With hubs in Frankfurt and Munich, the organisa-

tion is committed to operating one of the most technologically-advanced and fuel-efficient fleets 100

globally. Its division, Lufthansa Cargo, is a leader in air freight and serves 300 destinations across over 100 countries. Jochen Göttelmann is the Chief Information Officer at Lufthansa Cargo. Over the past 18 months, Lufthansa has refreshed its existing infrastructure and applications significantly. “We’ve defined a clear data centre strategy and it will mean that every new project and application will be cloud native,” says Göttelmann. “The cloud strategy came just in time for the coronavirus pandemic. We could seamlessly make our staff work from home with our cloud-based collaboration and communication platforms. On the business side our main focus remains on the modernisation of our sales applications and the implementation

OCTOBER 2020

101

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Your partner for air cargo logistics 4.0

Air freight is a key driver of the German economy, especially in times of crisis. As an IT service provider, Lufthansa Industry Solutions is using its technical expertise combined with industry know-how to play a key part in shaping the digital transformation in the air cargo industry. We asked Rainer Liebhart, Vice President Air Cargo Logistics, what challenges the industry must now face.

Mr. Liebhart, the airline industry is particularly affected by the Corona pandemic. What is the current situation with air freight? Rainer Liebhart: Until now, the Corona crisis has affected passenger traffic far more than air freight in Germany. The present shortage of belly capacity in passenger aircraft is currently leading to capacity bottlenecks across the market, resulting in a temporary increase in cargo rates. Having said that, the air cargo business is highly dependent on the global economy. It is precisely these prospects that are an indication of some difficult years ahead for air freight.

disciplines substantially. One especially decisive factor will be who can offer a good product on the market and to customers that is easy to understand and, most importantly, easy to book. The booking platforms we are all familiar with from the consumer sectors are also gaining ground in the cargo business. And it is precisely here that you must stand out from the competition with a market-driven price, a simple process and value-added digital services. It will be important to know and better understand your customers, the market, and the competition. Smart algorithms will allow you to predict behavior accurately and respond to it automatically.

Will the crisis give new impetus to digitization in air freight?

What can Lufthansa Industry Solutions do to help its customers achieve this?

How innovative is the aviation industry and what projects are pioneering?

Liebhart: I would speak less of a new impetus and more of a different one – a higher speed. More than anything else, the crisis has demonstrated just how much easier digitization makes arriving at better and thus more controlled and conscious decisions, including in extreme situations. In particular, the digital services offered and the interaction at the customer interface will be a key differentiating factor on the market and thus significantly influence success.

Liebhart: It’s varied. We focus our efforts on both disciplines for our customers: cutting costs and increasing revenue opportunities. Regarding costs, we help through the deployment and operation of our DevOps platform for example, which is available for our customers to use. Additionally, the combination of our industry and technical expertise allows us to help our customers not only obtain the right data, but also draw the right conclusions from it and implement it technologically in automated systems. Our experience in designing and implementing customer interfaces and background systems allows us to save customers a lot of time, resulting in speed advantages.

Liebhart: In terms of innovation, the industry is not as bad as it is often portrayed. However, we must not forget that the industry is subject to a great deal of regulation, meaning a lengthy decision-making and approval process awaits many innovative projects. But I am convinced that the speed is increasing despite the tense economic situation, especially in the case of those projects that contribute greatly to the company’s business. Despite the difficult overall situation, I am pleased to be able to carry out projects with my customers at such an exciting time, projects that will help to change logistics lastingly and make it even better than it already is in many respects.

What do air cargo customers need to do now to be prepared for the future? Liebhart: It is now a case of increasing the speed of digitization in the relevant

LUFTHANSA CARGO

“ We want to drive At the end of last year, the firm introdigitalisation in the duced a new dynamic pricing and has air freight industry to recently launched a smart booking API offer our customers to increase the connectivity to their better, faster and more partner and customer network. The next big milestone will be a completely convenient services” of new digital services to our clients.”

refreshed client-facing booking frontend in November. Göttelmann is also helping to renovate the internal sales system like CRM and the pricing tools. “It’s clear our current priority lies with the sales side, however, we continue 104

to invest in our other domains too. In handling, we got rid of our legacy host application already some years ago, and now have a state-of-theart IT platform which is the base for customer oriented process innovations like eFreight, targeting for 100% paperless document flows, or selfservice terminals to reduce waiting time for the truckers. In addition, a completely new production planning system is introduced for the internal capacity planning, steering and monitoring in our Frankfurt freight hub. And last but not least, we have migrated our analytics environment to the cloud and will also modernise our traditional OCTOBER 2020

— Boris Hueske, Head of Digital Transformation, Lufthansa Cargo

#GoDigital

CLICK TO WATCH | 1:01

105 BI and data warehouse over the next

services,” he says. “We’ve been quite

years to better support data-driven

busy over the past one and half years

decisions. We still invest lots in IT and

but the global situation is very differ-

plan to continue that as we move for-

ent now. Although we already had

ward as well.”

some good solutions in place prior to

Boris Hueske, Head of Digital

COVID-19, we extended our services

Transformation, states that the

on digitised processes. For example

impact of digitalisation accelerates

the high share of electronic docu-

the change happening in the logistics

ments we receive in the meantime

and transportation industry. This also

allows us to pre-check the information

requires the right perspective on IT

provided by the customer on a ship-

and data as a production factor. “We

ment and give feedback upfront on

want to drive digitalisation in the air

completeness and correctness which

freight industry to offer our customers

makes the freight delivery at the air-

better, faster and more convenient

port much easier and faster.” suppl y c ha i ndi gi ta l. com

A Partner in Pricing PROS is an important partner in our digital transformation. With PROS real-time pricing solutions, we’ve revamped how we provide services to customers while giving our internal teams the tools they need to work with greater speed and efficiency.”

Lars Mueller L U F T HA NS A C A R G O Director of Pricing

pros.com

info@pros.com

Learn more about the PROS solutions that are transforming businesses now.

“ COVID-19 has sped up a number of initiatives to drive automation and support new working models in a bid to connect our clients and partners” — Jochen Göttelmann, Chief Information Officer, Lufthansa Cargo

“We’ve accelerated the rollout of our new pricing services, for dynamic prices, the spot quotations. The automated price calculation is based on analytics available for our customers 24/7 which makes it easier to get an offer. We improved our API services for our customers which allows direct bookings by customer interfaces through the API into our system. The tracking services through the API are improved and provide an automated update if there’s a change in the shipment status. We’ve had a full set of improvements during the

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LUFTHANSA CARGO

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1994

Year founded

$2.5bn+ Revenue in US dollars

past 18 months based on digitalised processes, the improved IT infrastructure and new technology focusing on customer-driven services.” Hueske adds that he believes that logistics still has work to do to catch up with other industries that are further along on their digital transformation journeys. “Compared to other sectors logistics is a little behind the

4,500 Number of employees

digitalisation development but also in logistics digitalization accelerates and was massively accelerated by the COVID19 crisis,” he explains. “The industry still has papers left in the processes that accompany shipments

OCTOBER 2020

and is still working on modernising

at Lufthansa. “It’s clear that COVID-19

backend IT systems. One topic we are

has a severe impact on our invest-

working on is to further digitalise the

ment capabilities as an airline group.

booking process of further services

But it has sped up a number of initia-

that couldn’t be booked through

tives to drive automation and support

online services yet. It’s really about

new working models in a bid to con-

driving the digital processes forward

nect our clients and partners,” adds

for our customers. Our core pro-

Göttelmann. “I believe that some of our

cesses shall become digital, real

projects have even accelerated over

time and convenient.”

the past few months as a result of the

Göttelmann believes the coronavi-

crisis. IT always has a cost component,

rus has actually acted as a catalyst for

but is also a strong enabler to make

the acceleration of digital initiatives

a business run more efficient and to 109

E X E C U T I V E P R O FILE :

Jochen Göttelmann Title: CIO

Company: Lufthansa Cargo

Industry: Air Freight

Location: Frankfurt

After studies and a PhD in mathematics, physics, computer sciences and economics Jochen Göttelmann started his professional career as software developer at Dresdner Kleinwort Benson. After several IT positions in reinsurance and IT consulting he spent 12 years at Allianz Global Investors before he joined Lufthansa Cargo as CIO in 2015. He always worked in IT with a high business focus, dedicated to apply technology to enable business and drive digitalisation.

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LUFTHANSA CARGO

“ It’s now more important than ever before to determine what is adding value to the company and what no longer serves us” — Jochen Göttelmann, Chief Information Officer, Lufthansa Cargo

110

OCTOBER 2020

111

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Microsoft enables digitalization in logistics for resilient, intelligent supply chains Learn more

drive costs down through automation

our portal or APIs. We’re seeing a

and digitalisation.”

large trend in online booking because

“It’s all about information and trans-

it is the most accurate information

parency,” adds Hueske. “It’s important

available and the customer is in need

to provide customers with as much

of this information at the moment.

information as early as possible,

We’ve been lucky that we’ve been pro-

whether that’s about the capacity

active enough in the past to develop

available or shipment status. But, this

solutions and we’ve got some good

is centered around the availability of

services in place for our customers

data and the right interfaces through

and accelerate that rollout.”

E X E C U T I V E P R O FILE :

Boris Hueske

113

Title: Head of Digital Transformation Company: Lufthansa Cargo Industry: Air Freight

Location: Frankfurt

Boris Hueske has a degree in business administration of the Philipps University Marburg with a focus on logistics and finance. Within 20 years of industry experience in logistics, transportation and airfreight he took over management positions at DB Cargo, Lufthansa Cargo, XPL and Aerologic in the fields of supply chain management, sales, strategy, JV management, finance, revenue management and digitalistion. Since 2018 he is responsible for defining and achieving the Digital Transformation approach of Lufthansa Cargo with activities in automation, new digital services and digital business models.

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LUFTHANSA CARGO

PA R T N E R M E N T I O N S

114

Lufthansa Industry Solutions: The internal company with a strong cross-industry expertise is one of the most important partners for Lufthansa Cargo’s digital transformation mainly in the business domains Sales, Analytics and Revenue Accounting. As an IT service provider they combine technical know-how with process and industry knowledge and entrepreneurial thinking. PROS: Lufthansa Group has had a longstanding, strategic partnership with PROS for its deep expertise in pricing and revenue management, and more recently, quoting that powers Lufthansa Cargo’s booking and pricing platform. PROS has established itself as a strategic SaaS partner for Lufthansa Cargo’s digital OCTOBER 2020

transformation by powering accelerated quoting, delivering real-time pricing, modernizing the customer experience, and eliminating revenue leakage through consistent, disciplined pricing management. Microsoft: Microsoft enables Lufthansa Cargo’s digital transformation substantially as supplier for cloud services. Since we started the cloud transformation, all new software products are designed cloud-native on the Microsoft Azure PaaS and IaaS layers. Also our new CRM system is based on Microsoft Dynamics. Microsoft Teams has been introduced Lufthansa Group-wide already in 2019, enabling seamless communication and collaboration throughout the whole crisis.

“Compared to other sectors logistics is a little behind the digitalisation development, but this has been massively accelerated by the COVID-19 crisis” — Boris Hueske, Head of Digital Transformation, Lufthansa Cargo Hueske recognises that the global

With the future in mind, Göttelmann

situation has been difficult to navigate,

adds that focusing on what is actually

particularly for airlines, however, he

generating value is essential moving

stresses it is why it’s key to gain ground

forward. “From an IT side, it’s all about

on harnessing efficiency in digitalisa-

continuing to modernise the landscape

tion. “It’s a very unique situation in air

to enable the digital transformation,”

freight and for airlines at the moment,”

says Göttelmann. “It’s now more impor-

he explains. “COVID-19 has majorly

tant than ever before to determine

impacted the industry and we have

what is adding value to the company

to consider that in the future too. We

and what no longer serves us. That’s

had significant reduction in capacity

the challenge for us; we need to revise

in our markets on the passenger side,

our service portfolio. We also have to

with almost 50% of the capacity being

ensure we’re flexible and enable our

provided through passenger aircraft.

planning and governance processes to

We don’t know how fast this will change

be faster and more agile.”

either. However, it shows the importance of data insights and analytics. We confirm our goal to have greater data insights and leverage data in the best way to improve services and transparency for our customers.” suppl y c ha i ndi gi ta l. com

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OCTOBER 2020

The Digital Evolution of Procurement WRITTEN BY

GEORGIA WILSON PRODUCED BY

JUSTIN BRAND

117

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MEDITERRANEO HOSPITAL

Pavlos Tamvakis, CPO at Mediterraneo Hospital, discusses the evolution of its procurement operations alongside its digital transformation journey

ith 15 years of experience in the medical field, Pavlos S. Tamvakis, CPO at Mediterraneo Hospital, began his

career in the pharmaceutical industry conducting imports and exports for pharmaceutical drugs in the European Union (EU). After a few 118

years in the industry, Tamvakis moved into the medical device sector, where he was introduced to Mediterraneo Hospital. “I came to provide Mediterraneo Hospital with some medical devices, and they offered me the chance to set up a purchasing department for the hospital, which I have now been running for the past eight years,” says Tamvakis. When Tamvakis first came to the hospital there wasn’t a procurement department. “They had certain individuals managing procurement in each department sending purchase orders to the suppliers. By doing it like that, we did not have an overall clear picture of all the purchase orders. As a result one of the main implementations I made when I joined the hospital was developing a centralised procurement department,” OCTOBER 2020

119

2000

Year founded

€36m+ Revenue in Euros

350

Number of employees suppl y c ha i ndi gi ta l. com

MEDITERRANEO HOSPITAL

“ The main difference between our procurement operations before and now is that we have a clear picture of our procurement year on year” — Pavlos S. Tamvakis, CPO, Mediterraneo Hospital

comments Tamvakis. In addition to establishing a centralised procurement department, Tamvakis worked with his team to set up an e-store for the hospital. “The e-store allows people who need certain items to access the B2B store and make their purchase order on a centralised system, that notifies the procurement department and suppliers via email,” adds Tamvakis. In doing this, Mediterraneo Hospital has reduced its paper-based methods for its procurement. “This centralised system

120

also provides the hospital warehouse with visibility on what to expect coming in and out of the hospital, as well as what each department requires,” explains Tamvakis. For certain purchases made in the e-store, the products require approval, to implement this within the system, Tamvakis is working on an approval system, where for expensive products people can describe their requirement for the item and what it will achieve, which can then be approved or declined via the system. This system began development in the summer and is expected to be complete in October 2020. OCTOBER 2020

“The main difference between our

of what our people and patients

procurement operations before and

are using for the operations, but we

now is that we have a clear picture

didn’t have a very clear picture of

of our procurements year on year,”

our disposables.” Since develop-

comments Tamvakis. Mediterraneo

ing its procurement operations,

Hospital has two types of procure-

Mediterraneo Hospital has clearer

ment, one disposables used in the

transparency over its disposables.

hospital, and one specifically for

“We know the exact quantities of

operations. “In the past we have

what we have bought, which depart-

always had a clear picture

ment uses them and how many

E X E C U T I V E P R O FILE :

Pavlos Tamvakis

121

Title: CPO

Company: Mediterraneo Hospital

Industry: Healthcare

Location: Greece

Pavlos S. Tamvakis is an accomplished CPO who partners with senior management to mitigate and manage procurements through strategic planning following all regulatory compliance. Having followed courses in ISO Certifications, MDR 745/2017, ISO 13485:2016, ISO 9001:2008 and CFA Common Assessment Framework, he builds efficiency in procurement processes and implements new technologies in business operations with cost effectiveness always being his main goal. His continuous efforts have led to significant operational changes in the digital procurement transformation of the hospital over the past 8 years, making him an asset to the organization. Being challenged is what drives his success.

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MEDITERRANEO HOSPITAL

patients we have throughout the year. As a result we have a clear picture on our average daily costs, which we didn’t have before,” adds Tamvakis. With the adoption of new technologies and implementation processes, the hospital continuously develops its visibility into its procurement, gaining further insight into the hidden costs of the hospital. When it comes to the industry as a whole, Tamvakis has seen an uptick in the purchase of large quantities. “To ensure that we have

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Reference: 1. Greiling M: A multinational case study to evaluate and quantify time-saving by using custom procedure trays for operating room efficiency. Poster presented at European Association of Hospital Managers, September 2011

“ When establishing new collaborations with multinational companies, it’s important to have mutual trust” — Pavlos S. Tamvakis, CPO, Mediterraneo Hospital

Mediterraneo Hospital CLICK TO WATCH | 4:01

123 enough materials to last the next

focusing on the hidden costs, such

month or throughout the year, we

as the time it takes to conduct a task

will buy stock for six months. This

and how it can be done more effec-

is something that we never used

tively, as well as reducing the amount

to do because we knew that the

of waste produced at the hospital.”

suppliers and distributors would

Since joining Mediterraneo Hospital,

have the quantity that we needed.”

Tamvakis’s department has devel-

Another trend Tamvakis is seeing in

oped partnerships with companies

the industry is the focus on hidden

such as Molnlycke. As part of its oper-

costs. “Due to competition being

ations, Mediterraneo Hospital tries

harsh, everything is quite cheap to

to establish direct line partnerships

purchase, so you can’t really get

with multinational companies to get

much cheaper prices, instead we

better prices for those working in the

are looking at ways to reduce costs.

hospital and its patients. “Molnlycke

At Mediterraneo Hospital we are

is a Belgium based company that suppl y c ha i ndi gi ta l. com

MEDITERRANEO HOSPITAL

“ We are using automations in our warehouses day to day, but we also have two surgical robots, one for laparoscopic and one for orthopaedic surgeries” — Pavlos S. Tamvakis, CPO, Mediterraneo Hospital

provides the hospital with sterile 124

packs used in operations. Our partnership with Molnlycke took three years to establish due to the changes we made in the way that the hospital operates in order to increase the speed of our operations.” Molnlycke has also helped the hospital to diminish its costs by becoming a provider of personal protective equipment (PPE). “We didn’t originally buy our PPE from Molnlycke, but by switching to Molnlycke it has opened our eyes to the hidden costs and reduced a lot of the headaches during the current situation, which we would not have been able to do without our strong collaboration.” OCTOBER 2020

When looking for strategic partners, Tamvakis stresses the importance of mutual trust. “When establishing new collaborations with multinational companies, it’s important to have mutual trust and a sense of safety. Another factor is track record. We like to work with big companies to ensure that if something goes wrong, we have a big company behind us to find out the answers and solutions.” Looking to the future, Tamvakis sees a lot of automation happening. “We are using automations in our warehouses day to day, but we also have two surgical robots, one for laparoscopic and one for orthopaedic surgeries. We’re seeing more and more new technologies emerging which is exciting and important to drive paperless operations. I believe this is something that not only healthcare will experience, but a lot of other sectors too.” Tamvakis also reiterates the importance of identifying hidden costs in the future. “There are a lot of costs that we have not taken into account in the past, but they do make a difference over time.”

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OCTOBER 2020

Ooredoo Kuwait: Combating COVID-19 with Smart Solutions WRITTEN BY

GEORGIA WILSON

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127

OOREDOO KUWAIT

How Ooredoo Kuwait is helping organisations stay connected during COVID-19 and, as restrictions lift, resume business operations with smart solutions

ounded in 1999 as Wataniya Telecom, Ooredoo Kuwait is a member of the Ooredoo Group. The group rebranded

its name to Ooredoo Group in 2013 following its significant growth leading up to 2013, which transformed the company from a single market 128

operator, into an international communications company. Commenting on the rebrand in 2013, Ooredoo Group’s CEO Dr Nasser Marafih said it signaled its readiness to take the company to the next level. “It is our belief that we can better serve our global customers by leveraging the combined resources and assets of a strong, unified global business under one brand. We also believe that rebranding now will help us to maintain our momentum in the face of new realities for the industry, signalling our commitment to become a global force.” As part of its operations in Kuwait, Ooredoo provides tailored mobile, broadband internet and corporate managed services for consumers and businesses. “Ooredoo is guided by its vision of enriching people’s lives and its belief that it can OCTOBER 2020

129

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“ Ooredoo is guided by communications to help people achieve its vision of enriching their full potential,” says Ooredoo. people’s lives and Ooredoo is also committed to its belief that it can empowering Kuwait’s society by stimulate human driving digital transformation and enriching people’s digital lives. To growth by leveraging achieve this,Ooredoo Kuwait strives communications to to be a ’one stop shop provider’ of help people achieve leading integrated communicatheir full potential” tions in the region that are simple, stimulate human growth by leveraging

transparent, responsive, reliable, trustworth and innovative.

— Ooredoo Kuwait 131

COMMITTED TO SUPPORTING ITS CUSTOMERS With COVID-19 having a significant impact on organisations around the world, Ooredoo has reaffirmed its continuous commitment to supporting its customers. In support of the Kuwait government and its entities, to adhere to all instructions issued by the official authorities in Kuwait related to the current situation, Ooredoo Kuwait has implemented several initiatives since the outbreak in order to ensure that customers stay home. 1. Collaboration with the Information Technology Regulatory Authority (CITRA) suppl y c ha i ndi gi ta l. com

OOREDOO KUWAIT

132

OCTOBER 2020

133

to provide its customers with free 5GB

“We aim to continuously serve

internet and free calls for a month.

all our customers with high qual-

2. The launch of its ‘Be Safe. Be Home.

ity telecommunications services,

Be Online’ campaign. The campaign

while keeping in mind the safety and

features digital offers and services

precautionary measures to ensure

designed to support customers as well

the safety and well-being of all

as maintain connectivity and communi-

employees. We are also committed

cation of information.

to ensuring the safety of our custom-

3. Implementation of its ‘Work from

ers and employees while ensuring

Home’ strategy in order to maintain

that the Company’s business and

safety within its operations, to protect

core functions continue to operate

the health, safety and well being of its

smoothly during this volatile period,”

employees while maintaining busi-

comments Ooredoo. “In these difficult

nesses operations.

times, we understand the importance suppl y c ha i ndi gi ta l. com

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“ In these difficult times, we understand the importance of staying connected with each other” — Ooredoo Kuwait

staying indoors. Ooredoo continuously evaluates peak Internet data usage to stay on top of that demand,” it states.

INNOVATIVE SMART SOLUTIONS TO MITIGATE THE IMPACT OF COVID-19 While being online and staying connected at all times is essential to organisations who have migrated their

of staying connected with each other.

operations online, for those emerging

Whether conferencing with co-work-

out of the lockdown such as the supply

ers, reaching out for help and support,

chain, manufacturing and retail sec-

accessing sources of education and

tors, Ooredoo Kuwait has launched

entertainment, or staying connected

innovative smart solutions for those

with friends and loved ones, we know

preparing to ‘return to life’.

you depend on us to stay safe, stay home, and stay connected.” In its continued effort to support its

The innovative smart solutions provided by Ooredoo Kuwait include: multipurpose thermal cameras, walk

customers, Ooredoo Kuwait has an

through thermal detectors, sanitizer

important network of people work-

gates equipped with thermal detec-

ing to keep its customers connected

tors, facial recognition, contactless

“Our engineers and technicians take

attendance systems and social

great pride in offering our customers

distancing solutions equipped with

Kuwait’s best and most reliable net-

artificial intelligence (AI) analytics.

work to meet the expectations of our

These solutions provided by Ooredoo

customers. Being online and staying

Kuwait to mitigate the impact of

connected at all times remains essen-

COVID-19 and help organisations

tially important to all our customers as

return to work, reiterate the organisa-

they expect uninterrupted connection

tions commitments to being a pioneer

and strong network coverage while

in Kuwait for digitalisation, as well as suppl y c ha i ndi gi ta l. com

135

OOREDOO KUWAIT

“ We aim to continuously serve all our customers with high quality telecommunications services, while keeping in mind the safety and precautionary measures to ensure the safety and wellbeing of all employees” — Ooredoo Kuwait its ambition to keep up with the latest 136

trends within technology and ensure the safety and well being of others. “Ooredoo is committed to ensuring the safety of all employees reporting back to work in the next phase, and for this reason, we are providing a number of smart solutions customised for companies,” says Abdulaziz Al-Babtain, Chief Business Officer at Ooredoo Kuwait. “The world has changed since the onset of COVID19, and we must adapt to the ‘new normal’. It is our duty to protect the nation by ensuring the availability of smart solutions to control the spread of COVID-19. Ooredoo provides a number of smart solutions used by OCTOBER 2020

our enterprise customers to prepare for phase two in which employees will gradually report back to work. These smart solutions include multipurpose thermal cameras used to monitor employees’ temperatures and report high temperatures.” Harnessing the capabilities of AI Ooredoo Kuwait tools will not only allow organisations to utilise facial recognition and contactless attendance but will also optimise safety by enforce social distancing with line crossing analytics to keep employees within the own work area, as well as providing the capability to track compliance with health guidelines “Ooredoo is keen to ensure the safety and well-being of the employees and customers of its clients, and we will continue to provide our clients and the government with all their needs during this phase and we ask God to protect this great nation and its people from all harm,” concluded Al-Babtain.

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137

AB InBev: Procurement and Sustainability Strategy in Africa WRITTEN BY

138

MARCUS LAWRENCE PRODUCED BY

RYAN HALL

OCTOBER 2020

139

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ANHEUSER-BUSCH INBEV AFRICA

AB InBev harbours significant sustainability goals and is aiming to create a “company to last” through its green approach and initiatives

nheuser-Busch InBev (AB InBev) is “building a company to last”, and this claim has historically been backed by its

strong consciousness of the environment and supply chain ethics. As procurement and sustainability have become more central to many businesses’ operations worldwide, so too has 140

their inextricable relationship. AB InBev is one company whose sustainability-driven business ethos hasn’t been born during this new era of climate consciousness; instead, it has been supercharged by it. The realisation of the company’s 2025 Sustainability Goals, informed by reflection on the United Nations’ 17 Sustainable Development Goals (SDGs), relies on the strength of AB InBev’s procurement function in environmental and economic ethics, and in developing robust supply chains that ensure smooth business operations whilst having a positive impact on communities and the natural world. Across its global operations, AB InBev serves and operates in territories across the market readiness spectrum. At AB

OCTOBER 2020

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ANHEUSER-BUSCH INBEV AFRICA

2008

Year founded

$52.3 bn Revenue in US dollars (2019)

breweries and charge an incoming fleet of EV trucks, as an example, there are particular challenges in the Tanzanian market. The breweries in Tanzania, from the facility in the densely populated Dar Es Salaam to the spaciously located one in Mbeya, lack the support structures capable of sustaining large solar panel arrays on their rooftops. In

170,000+ 142

Number of employees

Mbeya, this can be rectified by using a ground-level solar field in the area around the brewery but, in Dar Es Salaam, space limitations and the risk of flooding close off the possibility of

InBev Africa, a microcosm of that spectrum can be seen across the continent’s markets, and rising to the strategic dynamism needed for this environment is a core focus of procurement. AB InBev Africa alignment with the 2025 Sustainability Goals necessitates a region-specific approach to partnering for large-scale projects but, in some African markets, in-country expertise at the standard required can be challenging to source. Using the company’s on-site solar power objectives, namely installing panels at sites to power both the OCTOBER 2020

Ricardo Tadeu, Africa Zone President at AB InBev CLICK TO WATCH | 3:17

143 developing a local solar field, meaning technology must catch up with the needs of the Dar Es Salaam plant. This desire to run independently of the grid is compounded by the company’s wider emissions reduction targets, with electric vehicles (EVs) set to replace fleets around the world. AB InBev Africa currently has one operational EV truck in its fleet, but its size limits it to journeys between its facilities and its smaller suppliers and customers. However, in the long-term, AB InBev aims to get a larger vehicle that can be used for the bigger bulk suppl y c ha i ndi gi ta l. com

PIONEERING AFRICA’S SOLUTIONS TO CHEAPER, GREENER ELECTRICITY FOR BUSINESSES CrossBoundary Energy pioneered the Solar-As-A-Service model in Africa, which is now enabling businesses across the continent to enjoy cheaper, cleaner power with no upfront cost or technical risk. Customers just sign an agreement to purchase solar electricity and we provide 100% financing, installation, and all-inclusive maintenance.You only pay for the power produced. In fact, if it doesn’t produce, we’ll pay you. CBE owns the largest portfolio of commercial & industrial solar solutions in Africa with our customers, including Unilever, Diageo, Coca-Cola Bottling, Heineken, Actis and many leading local companies. If you’re interested in receiving more information or to schedule a site visit and presentation, please contact us via the details below. Become a part of the movement and switch your company to cheaper, cleaner power today by completing this form and sending it to James Shoetan projects@crossboundary.com. We’ll respond within one week to get you started.

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• AB InBev’s 2025 Sustainability Goals are split into five key pillars: Smart Agriculture, Water Stewardship, Circular Packaging, Climate Action, and Smart Drinking. • Smart Agriculture – ensuring farming practices are powered by the latest technology and strategies to maximise yield, minimise spend, and mitigate environmental disruption. • Water Stewardship – exploring novel methods to cut water usage and waste across operations. • Circular Packaging – developing packaging that can be reused and recycled, as well as supporting the infrastructure that is vital to OCTOBER 2020

both encouraging and enabling consumers to return packaging to the manufacturing ecosystem wherever possible. • Climate Action – working to cut greenhouse gas emissions across operations by deploying new energy technologies, developing on-site electricity generation solutions, optimising waste management, and optimising logistics operations to lower fuel consumption and switch to greener alternatives. • Smart Drinking – fostering healthy attitudes to alcohol consumption across the breadth of AB InBev’s employees, partners, and customers.

deliveries to its key customers. The

efficiency, and a new fleet of LNG-

organisation’s overall aim is to source

fueled forklifts has been deployed

less fuel from an organisational point

across its continental operations. The

of view across Africa and reduce its

trial has been successful, with its LNG

carbon footprint in Africa.

forklift performing at 100% the same

Electricity, and the infrastructure

as a diesel equivalent.

to produce and use it sustainably, are

Having signed a contract with

not the only solutions that AB InBev

Tetra4, 50% of its fleet has been

is deploying for its procurement

converted to LNG, resulting in a 15%

operations in Africa. Its plants, where

CO2 emissions reduction. Forklifts,

necessary, have been relaid to accom-

being nimble and easy to move in and

modate its forklift trucks for maximum

out of facilities, represent a far more 147

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ANHEUSER-BUSCH INBEV AFRICA

148

efficient method of transporting loads

higher performance at smaller sizes

around sites than trucks, and LNG

and weights, will be closely watched

itself is easier to store and more dif-

as solutions to energy demands

ficult to spill than diesel. Another key

around AB InBev’s African breweries

advantage over electric units is that

are addressed.

LNG forklifts do not require sizable

The fact remains that, owing to the

batteries and space to store them.

challenges of infrastructure, expertise,

The lifespan of the batteries would

and market readiness, developing

also be an unwelcome additional

sustainable procurement operations

variable, particularly as solutions

in African markets via locally sourced

to the company’s on-site solar ambi-

solutions is a considerable challenge.

tions are still a work in progress.

In order to rise to it, AB InBev has

Battery technology’s incremental

sought to solidify its supply chain

advances, namely in delivering

through a mentorship programme

OCTOBER 2020

149

for both its suppliers and customers.

capabilities and explaining the value

By developing their skills in business

that expanding those capabilities will

management, and coaching through

have for business growth, they are

operations, AB InBev works to grow

encouraged to seek the investment

the business of its suppliers and cus-

required to diversify their offer-

tomers to increase their capability

ings. In effect, AB InBev creates the

whilst boosting their own profitability.

partners it needs, and the partners’

This approach reaps dividends, with

success in the market is positioned to

more competitive and financially

grow simultaneously.

stable links in the supply chain opening up new possibilities for improved business and more efficient operations. By approaching suppliers with propositions beyond their current suppl y c ha i ndi gi ta l. com

150

PZ Cussons: Transforming Logistics in Asia WRITTEN BY

WILLIAM SMITH PRODUCED BY

CAROLINE WHITELEY

OCTOBER 2020

151

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PZ CUSSONS

Tofan Yudianto, Head of Logistics, Asia, for manufacturer PZ Cussons, on thriving despite regional and COVID-19-caused logistics challenges

ofan Yudianto is Head of Logistics, Asia, for consumer goods company PZ Cussons. Since being brought into the

company in 2015, he has relished the opportunity 152

to transform the logistics strategy in an Asian setting. “PZ Cussons logistics business was operating in-house, but then they wanted to focus on their core business and work with external business partners for logistics.That’s where me and my team’s journey started - creating and articulating that long term strategy.” Yudianto identifies PZ Cussons’ “can-do values” as a key driver of its success, alongside the raft of watchwords such values inspire. “The question is whether we can stand for courage, accountability, networking, drive and also oneness. That last word, that last value of oneness is very important. I know this is implemented within PZ Cussons because even as this organisation is growing, people are remaining together.”

OCTOBER 2020

153

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PZ CUSSONS

154

That can-do culture was some-

The market in Asia has tradition-

thing Yudianto noticed straight away

ally relied on businesses driving

upon his arrival at the firm. “I was

consumer’s desires. No longer, with

challenged to adapt,” he says. “In

more empowered consumers certain

the beginning I had to work out how

about what they want. “The way I see

to adapt with my team and how to

it, now the customer drives the busi-

synchronise the frequency, and the

ness. What I mean is that in India,

rhythm of the way I work with the

China, and Southeast Asia, people

people in the organisation. That was

want a certain product delivered within

especially true with my team because

this time, with this quantity and at this

they have a real strength instilled in

price. The old industry and logistical

them by the culture.”

challenges were about distributing

OCTOBER 2020

“ Logistics and procurement have to be close” — Tofan Yudianto, Head of Logistics, Asia, PZ Cussons bigger volumes to the market, and

going to be provided. It’s about what

then the consumers going and buying

they want and what they need.

your product. But now the challenge is

“The biggest challenge in Asia is how

totally different. The consumer doesn’t

we can map and connect the dots and

care where the product is going to be

solve the puzzle between sourcing and

manufactured, where the product is

demand. In Asia for example, if you

E X E C U T I V E P R O FILE :

155

Tofan Yudianto Title: Head of Logistics

Company: PZ Cussons

Industry: Consumer goods

Location: Asia

Tofan Yudianto is Head of Logistics, Asia, for consumer goods manufacturer PZ Cussons. Alongside his logistics experience, he has extensive knowledge of differing parts of the fast moving consumer goods (FMCG) industry thanks to previous roles. “I started in my current role in 2015, but before that I was working with another multinational FMCG company, Unilever,” he says. “There I played several roles, working as the business system manager, working with a staff on projects, and also in the marketing and sales area.”

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PZ CUSSONS

1879

Year founded

$895.03m+ Revenue in US dollars

3,986+ 156

Number of employees

want to produce one product, you have to find the correct source at a competitive price, and it’s often not in one country. Logistics is going to enable that by working together with procurement on how to source a certain material, for example. You have to be good at mapping sources and demand and agile to work out how you’re going to manufacture something.” As with all organisations worldwide, The COVID-19 pandemic affects the way of doing business OCTOBER 2020

and PZ Cussons is also adjusting to shifting demand. “Demand is now more focused on the hygienic product categories instead of beauty products, for instance, with demand for our hand sanitiser product increasing significantly.” There have been plus points for the business, with the extraordinary situation accelerating pre-existing trends. “We see that the online business is actually growing quite aggressively because people are stuck at home. So it’s direct to consumer and now

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157

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“ We believe that sustainability is good for business” — Tofan Yudianto, Head of Logistics, Asia, PZ Cussons

OCTOBER 2020

SERVICES INCLUDE: Domestic Freight Forwarding

Customs Clearance

International Freight Forwarding

Project Cargo

Contract Logistics

E Commerce Logistics

consumers are driving the business,

points and routes will be much more

telling us exactly what they want. And

online, with small volumes of quantity.”

it’s not just the millennial generation -

Sustainability is a key focus for the

because of the situation we’re seeing

company. “At PZ Cussons we believe

all age groups heading online, and the

that sustainability is good for business.

winner of the situation is going to be the

So the business has a responsibility

business that can adapt quickly to the

to align the way it operates with the

new normal. The difference between

cause of sustainability. For logistics,

online versus offline distribution is in

the challenge is about reducing the

the complexity, where the destination

carbon footprint. For example, at a

159

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PZ CUSSONS

160

OCTOBER 2020

“ The biggest challenge in Asia is how we can map and connect the dots and solve the puzzle between sourcing and demand” — Tofan Yudianto, Head of Logistics, Asia, PZ Cussons

number of our distribution centres, we are increasing the efficiency of our electricity use.” Another avenue of exploration is the efficiency of transport, which can be challenging in less developed parts of the APAC region. “One question is how we can move from a fleet of small vehicles to more efficient transport. So we are reducing the number of trucks on the road and therefore the carbon footprint. Beyond that, we’re working on utilising rail as much as possible.” The work PZ Cussons does is enabled by the support of a number of key partners. “We work with some multinational and local logistics providers as our partners for warehousing, suppl y c ha i ndi gi ta l. com

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PZ CUSSONS

162

“ These pillars enable logistics and the growth of the business” — Tofan Yudianto, Head of Logistics, Asia, PZ Cussons

OCTOBER 2020

163

and we also have a number of vendors

chain strategy. “The whole supply

for transportation and freight,” says

chain is facing the challenge to the

Yudianto. We work with our regional

manufacturing and procurement

procurement partners in Singapore in

strategy together, and as part of that,

order to be aligned with what we are

logistics has to be ready.“

trying to achieve.” Yudianto is confident that PZ Cussons is well placed to thrive in the future, despite changing market conditions and the impact of COVID19, thanks to a clear and united supply suppl y c ha i ndi gi ta l. com

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