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2016

I interviewed Daniel Stanton who discussed Supply Chain Talent and Supporting the Education Community.

 

 

 

 

Please provide a brief background of yourself?

 

Hi Dustin. And thanks for having me here today. I’m the Vice President of Education and Workforce Development with MHI, the non-profit trade association that serves the U.S. supply chain, logistics, and material handling industry. I came into this role after 20 years as a supply chain professional and project manager, with a particular interest in training and education. Most recently, I was working at Caterpillar which has an immense global supply chain. And it became clear that while there were many opportunities to drive improvement through processes and technology, that talent was a critical factor in building and sustaining supply chain improvements.

 

What are the pressing issues today pertaining to supply chain talent?

 

The simple answer is that we have a shortage of talent. We have a number of studies that back this up, and we’re starting to see real problems when companies can’t find and keep the supply chain talent they need.In some cases, the work just doesn’t get done and both the companies and their customers suffer. In other cases, the jobs move to places where there is a healthier supply of talent to support them. But one of the good things is that it also creates a ripe environment for innovations and technology.

 

Baby boomers are retiring at the rate of 10,000 per week, and they are taking with them the years of experience that it takes to really understand many of the supply chains in global companies. The generations coming behind them don’t have the same knowledge and experience, and there are fewer of them. So that’s leaving a void. On top of that, the participation rate for the Millennials is shockingly low, meaning that they are choosing to enter the workforce later. So whatever we’ve been doing to recruit talent into our industry and train them is too small and too slow to meet the needs of todays companies. And, by the way, as

 

I think in terms of supply chains, and for the past few years I’ve been looking at this particular challenge in terms of the supply chain for talent. It kind of makes sense, really. Companies have a certain demand for talent at any given time. There are places they go to get talent – their suppliers, and there forces that pull talent out of companies.

 

How can these issues be addressed effectively?

 

Usually, when you are trying to wrap your head around a supply chain – at a strategic level – you have to start by characterizing the demand. So what kind of talent does the company really need to support its supply chain? Are they talking about managers, or engineers, or middle-skill folks – who have some education beyond high school, but perhaps not a college degree. Are you looking for people in the beginning of their career, or do you need people that already have experience? Then you can start to ask questions about how many of each they need, where they need them, when they need them, and how much they are expecting to pay them.

 

You really need to do that demand planning step before you start to look at supply. Because once you know what you need, then you can make smarter decisions about where you need to be spending your time and money to build recruiting relationships.

 

But once you know what you need, then you can make smart investments in suppliers  – particularly in schools – where you are most likely to find candidates who meet your needs. And if you can’t find the suppliers you need, then you’ve found a gap. You may need to look for other options, such as starting your own training program, but at least you can diagnose the issue and start working on the real problem… rather than wasting time looking for candidates that don’t exist.

 

Where have you seen success?

 

The companies where I am seeing the best results are the ones thatare really connecting the dots between talent and profitability. So that’s what it takes at the company level… usually there is some kind of crisis – either a bunch of supply chain people leave at the same time, or the company creates some critical new positions but then can’t fill them. Then they get religion, and start finding ways to host events, provide scholarships, serve on advisory boards, and do things to raise their profile, build better relationships, and promote their employment brand.But the key is to sustain this commitment. Talent is a supply chain, but it has a really long lead time and requires a long-term commitment to relationships with suppliers. Once leaders make the shift from thinking about the talent crisis as a “touchy-feely HR issue” and see it as a serious risk to their business. At that point, it suddenly becomes much easier to justify the investments in recruiting, development, and retention.

 

But the truth is, while companies can do some things to reduce the impact of the supply chain talent crisis on their business, we’re still facing a major deficit as an industry. And that’s really where organization like MHI and others can play a role… bringing together the collective resources of our members to raise the profile of our industry, make it more attractive to candidates, and ensure that they have access to high quality training and education. For example, MHI sponsors a group of engineering professors called CICMHE – the College Industry Council for Material Handling Education, that promotes supply chain technology education at the university level. And MHI’s Career and Technical Education program supports high schools and community colleges that offer classes that ensure students have both the technical and professional skills to enter the workforce as soon as they graduate. One of the coolest things that MHI does is a program called Student Days that we sponsor during our trade shows. Our trade shows are the largest gatherings of supply chain professionals in the United States. The shows start on Monday, and go through Thursday, and we’ll have over 800 exhibitors and from 23 to 40,000 attendees. But on Wednesday, we invite around 250 students in for a special program, and we turn the show floor into a classroom. They get guided tours, a special program of speakers… first-class treatment. All as a way of making the industry attractive to young people, and helping to ensure that they get an opportunity to see it up close and personal.

 

Thanks for having me Dustin. These issues around supply chain talent are serious, and it’s something that we all need to be working on together. Every little bit helps, and I appreciate having the chance to connect with your audience. Thanks

 

Thank you for sharing.

 

 

About Daniel Stanton

 

 

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Daniel Stanton

Supply Chain Executive

LinkedIn Profile

I interviewed Remco van den Berg who discussed Dealing with Supply Chain Uncertainty in Agribusiness Supply Chain.

 

 

 

 

 

 

Can you provide a brief background of yourself?

 

Yeah. Thank you, Dustin. Thank you for having me as well. I graduated from Cranfield University with a masters in supply chain last September 2105. From there, I applied to a graduate program within a big agribusiness company called Syngenta. And they hired me. I've been there since the first of October. The program that I'm doing is a three-year program. I'm going to do three different roles within their supply chain.

 

Can you discuss the types of uncertainty in the supply within your industry?

 

There's multiple things of uncertainty. On a more strategic level, if we look at the business on a global level, there's a lot of uncertainty in terms of businesses merging and buying each other. And it all started with the Dow - Dupont merger. And then we also have the commodity prices with that, which are dropping, not just in the agribusiness, but all of the commodity prices at this point, which drives a lot of prices down and creates a lot of uncertainty for farmers to get the right price. Also, if they will be able to buy the right products, basically, for the right prices, if their income goes down.

 

And then on a more operational level, we look at uncertainty on a longer term for us in terms of forecast for products, we have to make decisions for crops to grow for 2018-2019 to have the seeds ready, which now creates a lot of uncertainty in terms of what are we going to plant now to have the seeds ready in 2018 if we don't know what farmers want to grow in 2018 or 2019.

 

If some products that are hyping at this point, will they still be hyped in 2018 and '19? And how many acres do we need? And how much seed do we need of that? That's something I'm currently involved in with my first role to look at that. It's difficult, difficult to narrow down how much are you going to actually grow and plant on a global scale.

 

Then there's also the uncertainty where you can't grow every crop everywhere.

 

Can you talk about why is there uncertainty?

 

Yeah. There's uncertainty on a more global scale. It's because commodity prices are falling and because the industry is going through some rough times where mergers are happening and where shareholders are looking for more interesting ways to make money and to get the company at a right level. So, that's why there is uncertainty, I guess, on a global scale.

 

When we look more on operational scale, there's uncertainty because no one knows what's going to happen in 2018 and 2019. But we to make decisions to go there, to make sure we have to right products ready for that. That drives up a lot of inventory for us.

 

My last question is how can this be effectively addressed?

 

That's a good question, and that’s something that we're looking at at the moment and from a more theoretical perspective, and things I did in my master degree and everything. We learned a lot about how on a supply chain side and how you collaborate with partners and how you share the risk, etc. And the things we see now is that you can't do that alone as a company. And also, what are our competitors doing? If they don't make the same supply chain decisions, and they're all facing the same issues...you sort of end up in an endless cycle. If competitors are not doing, are you really able to do it? Or are customers then going to choose from your competitors?

 

So, that's something we're looking at in terms of how are you going to make it more of a robust thing. And how can we address the uncertainty of making sure that farmers know what we would have available for them and why they should get our product and why they should collaborate with us to manage the risk and to share the risk as well.

 

Thanks, Remco. Are there any final recommendations you have for people in your industry dealing with uncertainty?

 

Some of the same issues that we have as a company. To look at the collective model, looking at how we can collaborate more to address the uncertainty and to reduce... There will always be uncertainty, but if you can work together to get as much information as possible, at least you make decisions with more certainty.

 

Thanks for sharing today.

 

Yeah. Thank you for having me.

 

 

About Remco van den Berg

                                                                                                                                       

 

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Remco van den Berg

 

S&OP Analyst at Syngenta

 

LinkedIn Profile

I interviewed Cherylann Welch who discussed Leadership in Supply Chain.

 

 

 

 

Can you provide a brief background of yourself?

 

Sure. No problem. My name is Cherylann Welch. I've been in the logistics industry for the last 15 years, plus. I currently have an MBA in global supply chain management, and I really enjoy the fast-paced, excitement factor in regards to logistics. I think it's very interesting. I think it really pushes your thinking, and it really encourages you to become a detective sometimes.

 

But overall, I'm really excited to speak to you.

 

Thank you. My first question is how do you define leadership in the supply chain?

 

Leadership on a whole, from my perspective, is that ability to lead from behind. What I mean from lead from behind, you should be able as a leader, in general, to be able to relate to the needs of your clients, as well as relate to the needs of your staff, and as well, to relate to the needs of the industry. You should be privy enough and knowledgeable enough as to the ever changing changes that we have in supply chain management.

 

It's all about innovation, creativity, but also humbleness. And the reason I say humbleness is because, while it's a fast-paced business – we're always on the go. Shipments are moving left, right, you're sending, you're trying to make that flight, you're trying to come up with the most cost-effective way to provide the level of service that you want for your clients, as well as still provide service.

 

At the end of the day, you have to understand that you're trying to meet the need of a client, both internal and external clients. So, you have to have a balance when it comes to leadership and not just focus only on the day-to-day operation, but also be willing to sometimes getyour hands dirty. At the same time, sometimes try to really look at the trends and see what the challenges are and how you can really develop your operations from a holistic point’s perspective. That's how I see it.

 

Why is leadership important?

 

To me, leadership is very, very important. In order for you to be successful in anything, in general, in life on a whole, you have to have a goal. You have to have some type of strategic plan where you want to accomplish the goal. A lot of the times, we often say that there's different reasons why we provide a service. It could be for quality. It could be a brand. It could be innovation. I would stick to that.

 

Basically, what I'm saying is that when you have strong leadership within an organization on a whole, your team tends to follow suit, and that can be seen by how you treat your clients, how you treat your employees, and usually, that allows organizations to always take themselves to the next level.

 

So, it's all about having that differential edge that a lot of organizations tend to try their best to have.

 

For example, I just recently read AT&T's CEO said that one of his focuses x– [audio cuts out]

 

Why is it important?

 

Why leadership is important...it's really about taking your organization to the next level. It's all about differential advantage. It's all about having a great understanding of the industry and leading by example. One of the things that I just recently read was AT&T's CEO stated that he wanted to focus on continuous learning for his team, for his entire organization. I found that to be really, really interesting.

 

It made me smile, and the reason why I said that is because a lot of the times, organizations do not invest in their key people, which is their staff. And I think a lot of times we fail to realize – and this also stems from leadership – the people that are working the day-to-day operation for your organization have a higher chance of providing solutions and innovative solutions for the good of your organization. However, sometimes they are not focused on, because sometimes the organizations focus more on either the profits, or they focus on trying to meet client needs. And I think it's about balance.

 

So, when you have strong leadership, where they cover all the key intricacies within the organization from operational cost to employee development to client development to seeing the clients' needs, meaning what the client's expectations are.

 

They tend to look at the organization from a holistic point of view. And then everything works more seamless. But sometimes, unfortunately, we think leadership is about just working in our own little silos and someone is just dictating how things should work. And there's no harmony within the organization, and I think that's something that a lot of the companies lack.

 

So, to see a CEO realize that we're in a changing time where technology has grown so fast... You can get anything online in a split second, and being about to compete with other companies and organizations worldwide is key to ensure that your staff is highly developed, as well as ensuring that your clients are educated.

 

That's one of the things that I've seen working in this industry for the last 15+ years, is that a lot of times there's an imbalance in how information is shared and how people lead. And that's just my personal feeling.

 

How is it done effectively?

 

I think leadership is done effectively by one having everyone on the same page in regards to what exactly is the ideal goal. For example, currently I work for Worldnet, and they are based in New York, and they're focus is the fashion industry. And they have key core values, and they instill the key core values within every staff member. They actually spend an exhaustive amount of time training and developing their staff in understanding that the most important two components within the company is the clients and the employees.

 

And this message is carried throughout the organization, from the cleaning guy– he's aware of the core values; he's aware of what the goals are of the organization. And I think that's one of the things that a lot of the times, it’s not done effectively. I always believe you should be able to pull aside the lowest ranking employee in the organization and inquire what is the goals of this organization? Where do you think the company is going in the next five years? And they should be able to at least be able to say confidently at least five key things. And that's because it was trickled down from the top down to the bottom.

 

A lot of times information stays at the top, and then employees are doing their own thing, and then we lose sight. So, we find companies facing a disparity and trying to understand what happened. Where did we go wrong? But I think it's all about communication. I think it's about dedication. I think it's about showing everyone is on the same page in regards to the strategic plan and understanding what your key role and responsibilities and how your role impacts the good of the organization.

 

To me, that's where you have greater opportunities to grow as an organization because everyone is able to relate and understand exactly what the main goal is and what the strategic is going forward to accomplish those goals. That's just how I see it.

 

 

About Cherylann Welch

 

 

Cherylann Welch.jpg

 

Cherylann Welch

Logistics & Supply Chain Manager

LinkedIn Profile

I interviewed Paulo Moretti who discussed Measuring Cost Savings, Capital Reductions and Avoidances in Purchasing.

 

 

 

 

Please provide a brief background of yourself?

 

I have worked 35 years at Dow Chemical where I developed experience in diverse areas as: Manufacturing, R&D, Sales, Marketing, Business, Finance, Economic Evaluation, Strategic Planning, e-Business and Purchasing.

 

Since 2012 I have a consultant company (PM2Consult) with focus in Purchasing and market analysis for chemicals and plastics.

 

What is the starting point for developing effective purchasing metrics?

 

It starts with Purchasing leadership. Effective leadership is able to elaborate critical questions like:

 

• How do you know where to improve?

 

• How do you know how you compare with others?

 

• How do you know whether you are improving or declining?

 

In one of my written articles published at on-line magazine MyPurchasingCenter.com , I suggested a framework that relies on the main activities in Purchasing: Internal Client, Suppliers and Sourcing Activities.

 

Just as an example, we can mention Satisfaction Level for Internal Clients; KPI’s as part of Supplier Scorecard and Savings from Sourcing Activities.

 

How do you track the savings and benefits?

 

I have developed an Excel tool called SAS - Sourcing Activity and Savings. This tool calculates and tracks five elements: Addressable Spend, Cost Savings, Capital Reduction, Avoidance and Total Procurement Benefits (TPB).

 

Addressable Spend = It is the amount of spend that generates reported benefits.

 

Cost Savings = Also known as EBIT Impact, this is the impact on the income statement relative to the previous period (i.e., previous year). This is the difference between the costs in the previous period and the costs after the sourcing activity. For example: buying a pump for maintenance.

 

Capital Reduction = This is the impact on the balance sheet, the difference between the levels that existed before and the levels after the sourcing activity. For example: buying a pump for a capital project.

 

Avoidance = It is the price increase avoided based on forecasted existing price vs. new price paid. The formula is a soft savings to reflect value creation relative to potential or anticipated negative impact to the future Income Statement or Balance Sheet.

 

Total Procurement Benefits (TPB) = It is the total value created by Purchasing (the sum of cost savings, capital reduction, and avoidances). This is the difference between the outcomes if Purchasing had not done the project.

 

Where have you seen success?

 

Companies who use this kind of tool must engage Finance to validate the methodology, so the businesses will trust in the final results.

 

I think the tool and the methodology had a strong success because the article I wrote about it was the third most read article in 2015 at MyPurchasingCenter. I have received several e-mails from different companies asking specific question to implement the tool. So, I’m glad and honored to have so much interest in the tool and concept, and I hope your audience will find also useful for their needs.

 

Your audience can download the tool.

 

About Paulo Moretti

 

 

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Paulo Moretti

Principal - PM2Consult

LinkedIn Profile

I interviewed Anand Chatterjee who discussed Supply Chain Review.

 

 

 

 

Can you first a provide brief background of yourself?

 

I have been primarily working in the domain of supply chain, consulting supply chain strategy and supply chain transformation projects across various organizations globally. I started working my career with PricewaterhouseCoopers, then moved on to GE, and then JDA, which used to be Manugistics logistics organization. And then, of course, right now I'm working with ITC Infotech.

 

But I worked with various organizations across the globe, across transformation projects, and one of the things that really interested me over the years has been the people aspect in supply chain transformation projects.

 

With advancement of technology, there has been a lot of very sophisticated software, too, developed in the market and the space and the supply chain space, whether it be execution or a planning and optimization piece. And that's been across the globe, whether it be developed economics or whether it be emerging countries.

 

Organizations do start supply chain transformation projects. A lot of these are enabled through technology, with a lot of interest, a lot of gusto.

 

Over the years, the interest slowly starts draining away because they find it really different to absorb the complexities of the software. They really struggle to utilize the functionalities that's available in the software. And that's been my interest, to help organizations to adopt them, to utilize the functionality in the fullest capacity.

 

Could you talk a little bit about how it's done?

 

The supply chain family, if you look into the area of supply chain, it's broadly classified, probably into two areas. One is the supply chain execution piece, and the other is supply chain planning and optimization piece.

 

The supply chain execution piece has been there for quite some time, probably in some way or other. If you leave out the technology piece, it's been there for as long as the history of organization would be. But with the advent of ERP applications, whether that be the Baan or the SAPs, or the Oracle applications, the supply chain execution has been supported by the software applications for quite some time.

 

But the supply chain planning and optimization piece became fashionable with organizations probably when i2 became popular in the mid-'90s or late '90s. Thereon, there has been quite a bit of players in the space. JDA is probably one of the better known organizations. SAP, of course has it's own suite of products. So does Oracle in the supply chain planning and optimization piece.

 

Probably, if you look at these applications, which is primarily supplies, planning, and optimization piece, they involve a lot of complex algorithms, sophisticated functionalities. And organizations, too, really look into using these applications to increase their revenue, to improve the bottom line through use cost.

 

But as the implementation goes through and as they try to use some of those applications, they really struggle to use the complete set of functionalities.

 

And over the years, there's been a lot of new organizations that have come into place. For example, Kinaxis and some others are online, some other startups. They have been really looking into how to make their software simpler for organizations to use. And that's really been transforming the space over the years.

 

There's a famous framework in the consulting world, which talks about the people, the process, and the technology. But what I generally try to do is, I start with the process part and take a really agnostic view of how we could improve the process and the supply chain area.

 

Then I look into the technology part, how the process we're looking into can be supported, whether technologies are available in the market, or whether it be custom built for the organization.

 

But on top of it, probably what is really the most important part is the people adoption of either the process or the technology. And that's how I go about...increase the adoption of these whole transformation projects in the organization.

 

Do you have any examples of success or success stories or good results?

 

Yeah. If you look at one of the organizations that I've been working on... Let's take an example of an organization which went about doing such supplies and transformation project. And this organization went to implementing a Demand Forecasting too, which then the Demand Forecasting figures are then used for distribution planning across a distributed network for the consultant supply chain for the organization.

 

And then, of course, it was again used for the supply planning, which could be in-house production planning. Or to could be outsource production. And then, of course, a part of it was also used for raw material procurement.

 

Given the complex structure of this organization, this organization went about implementing the solution, they really struggled in terms of what could be a very single view of the performance metrics that they had put in place to measure the success of this project.

 

So, if you're looking at some other very popular metrics that is generally used in this field of operations, supply chain's failure rate are on time and full.

 

If I think about various organizations – and I'm talking about big multi-national, big Fortune 500 organizations – I've seen that there's no single definition of some of those very simple metrics. And organizations do claim about using some of these metrics to their own benefit.

 

So, if you go and talk about market-facing sales organization, which is found responsible for insuring that the products are delivered to the consumers in time and in the full ordered for. They would say that they're on time in full metrics almost as high as probably 95%, or about that.

 

But when you delve deeper and look into the exact definition of how they define this metric, how they define those numbers, it really looks that they would have probably not taken a very scientific approach towards it. This particular department would have defined what could be the best way to represent their own interest.

 

And if you go further upstream, and if you'll talk to the production guys and talk about those guy claiming they're having a very high on-time and full metrics, they would say, "No, that's a false representation of the facts." The actual figures probably might be in say 70s or 80s.

 

Now, if you go deeper... And those organization often struggle to understand why I get two different pictures from two different departments in the same organization.

 

The second... What the struggle is how do I bring about those two departments to work in a symbiotic way so that the whole organization benefits through the supply chain transformation projects as it goes along.

 

I believe the key to this is the way you define your metrics hierarchy. How do you go about defining the performance measurement across the organization? That's when the people aspect starts coming in.

 

So, in this particular case, we defined the supply, sales and operation planning process very scientifically. We kept out first the people dimension out of it. We look into the whole process and said this is how it should be looked into. This is how the performance measurement should be defined. This is how the process should start, at what day of the month. What are the technology aspects? When do you run the Demand Forecasting piece and the application then go on planning the distribution planning?

 

And so we define the whole supply chain process. And then we insure that supply chains, sales and operations planning process is probably one of the most difficult processes to establish in any organization, because there are too many departments which get involved in it, from sales, from marketing, procurement, production, finance, logistics and warehousing. Everybody has to get involved in it. And unless you take a very detailed process or wide view, you would find in really difficult to get it accepted by all the various departments.

 

And that brings up the very important aspect of people.

 

How do you insure that each of the departments feel that they have been given due importance to it? The way they are being measured is proper? And the other department may not take an undue advantage of this particular department.

 

So, you have to go about doing a proper approach of defining the whole piece of the performance measurement. From what the object of the organization is, how does it get implemented on into operation, operating performance metrics. And then gets into how does it get into the tactical aspect of measurement.

 

That's how we went about defining for this particular organization. At each node, we went about giving a proper set of visibility of the numbers to the various departments. We insured that the way the rows had been defined for various organizations, gave them the right set of information to take corrective actions. We insure that manual interventions are properly minimized because, the more the manual interventions, the more the ad hoc ways people try to respond to various situations and probably they also try to, I will say, manipulate some of the numbers, especially in terms of reporting.

 

Finally, of course, it did take a couple of months to stabilize because there was a whole lot of change to management aspects in one place.

 

But we slowly went about doing it. In some cases we had to use a simplified version of the planning tool. We made it slightly simple to start and then went about increasing the complexity over the months when we found that people were more open to accepting some of the supply chain applications within the organization.

 

Do you do any final recommendations?

 

One of the things that we went about, I would really recommend to keep things simple. Technology is probably progressing a lot faster than... I would say that things are very different from the people perspective as an execution perspective. As I say to organizations, especially it could be more applicable to emerging economies... Some organizations say, "I bought this expensive application. Why don't I run it daily?" What I recommend and tell to the organization is that you can probably run it daily or probably every hour, but you would really struggle to implement that recommendation.

 

So, for example, the planning tool says that you probably dispatch a certain amount of goods today to a particular destination, but things would have changed. The ground reality is different, especially in emerging economies, there would be a lot of uncertainty in terms of what kind of vehicles are available, what transportation, what kind of space might be available for storage and warehousing. There could be even political unrest in certain parts of the country, which probably affects their movement of goods.

 

And these uncertainties...what happens is you know the recommendation of planning tool is probably what you may not be able to execute. So, you would have to bring in a certain amount of people aspect to it. To bring in that, you have to really give the application a relatively simple to begin with.

 

Your planner should be able to comprehend the results that's thrown out of this application. They should be able to absorb this and understand the fullest implication of the results for your organizations and then make a decision in terms of how they can be, implement it given the ground realities, especially in these emerging economies, where there are probably a lot more uncertainties and variations in execution.

 

So, I would recommend to keep things simple. Just because you bought an expensive application does not mean that you have to use everything. Make sure you use whatever is actually needed for your organization. And then probably you're going to evolve the adoption of this technology as you move towards your goal.

 

Thanks, Anand, for sharing.

 

Thank you, Dustin. Thanks for your time.

 

 

About Anand Chatterjee

 

 

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Anand Chatterjee

Associate Partner - Supply Chain Management

LinkedIn Profile

I interviewed Charles Brewer who discussed Last Mile Delivery.

 

 

 

 

Can you first provide a brief background of yourself?

 

Absolutely, Dustin, and it's my pleasure. My name's Charles Brewer, and I spent the last 32-33 years directly or indirectly involved in supply chain and more directly than not, and have worked across every region in the world, which has been a fantastic journey. But my latest venture, having left DHL about six months ago, is focused purely on ecommerce and last mile delivery, which I think, to be very honest, is a hugely exciting area.

 

Everywhere you go, anything you read, anything you look up online is talking about how to crack that code, how to sort out that last mile delivery piece. So, we're really focused on cracking that code, and we're doing it in possibly the most difficult region in the world, which is Africa, which has abstract challenges across all supply chain areas, but even more so from a last mile perspective.

 

So, it's really exciting. Great fun. Personally, I think if we get it right, it's the pot of gold at the end of the rainbow from an ecommerce perspective. So, just started but very, very exciting.

 

Can you talk about what's involved and what it is?

 

Yeah. Sure. I think most of your listeners and readers and yourself will be very familiar with the explosion that is the ecommerce world and has been for the last three to five to ten years. I think, in particular, the last 12-24 months it's been gathering pace. In fact, I read a great article just yesterday I think it was that said the US retail environment would have gone backwards were it not for the ecommerce growth they experienced, particularly in Q4 last year.

 

Ecommerce is where it's at. More and more and more, our traditional consumers and customers are no longer going to bricks and mortar malls and doing things more and more online. We have two divisions under the MaraSokoni umbrella. One is very much focused on the online shopping space, so we're building an online shopping platform, much in the same way as you would go on to Alibaba or Rakuten or Amazon or whoever else.

 

So, Mara Shopping will go live in Nigeria later this year. And we didn't want to stop there. We said, that's one-half or two-thirds or one-third of the magic bubble, but the real clever stuff is how you get the online shopping item delivered. So, we then said let's have a separate business unit which is called Mara Xpress, which focuses very much on the last mile delivery, so how to get the goods from merchant to the customer. Which, in itself – as I said, having spent the last 32-33 years in supply chain – it sounds fairly easy. But it really is where the rubber hits the road.

 

If you look at any research that's out there, any report you pick up, it'll tell you the same thing, that customers, for the most part, are really unhappy with the level of service, the level of choice, the level of visibility, the cost, the speed, the predictive nature of delivery. They're just generally unhappy.

 

In fact, I read a statistic – I think this was two or three weeks ago now – from a European survey that was conducted across thousands of consumers. 80% of consumers said they were either dissatisfied or very dissatisfied with their last mile delivery, which is just staggering. Eight out of ten customers say they're not happy with the service they get from their logistics provider across last mile.

 

To the point, Dustin, we're launching a shopping platform, and we have already launched our last mile delivery service in Dubai. In fact, where I'm calling you from today is in the UAE. So we've started here, and very unsurprisingly, we started with zero shipments. And every day, we set a new record in terms of volume.

 

It's really a great example of the old adage: If you build it, they will come. So, that's what I'm doing. If you like, I can talk to you a bit about some of the secret sauce that we're applying in last mile delivery.

 

Yes, can you talk more about that?

 

Sure. If you look at global ecommerce statistics, something like 94% of all deliveries globally – and it's a huge market, as you would appreciate – are still being delivered through very traditional methods, which is the courier. A man or a girl in a van, and off they go in the morning with their 30 to 100 deliveries, and they try and make a delivery. The problem with that is there are two fundamental problems. One is you can only get a courier to a certain level of efficiency. So, it's very, very hard to make a margin just pushing the same volume through the same process. So, that's problem number one. From the supplier perspective, it's hard to actually make a profit.

 

But the other problem – and probably for more acutely related to the 80% of customer who are dissatisfied, and I'm sure you've probably have ordered online, Dustin – if you ever sat at home waiting for a courier to arrive, you wait and you wait and you wait and you wait, and then around about 3 o'clock in the afternoon you call the call center, who hopefully just about speaks English. And the call center agent says, "Yeah, the courier is really busy, but we did you he'd be there at some point between nine and six PM today, so just wait."

 

So, you go back to waiting and not doing all the things you should be doing. One of three things happens. Either the courier turns up, which is great, with your emotionally-bought shipment; or you pop out for five minutes to go and buy that milk, pick the kids up from school, go and play rugby or football or have a customer meeting, whatever it may be, and you miss the courier in those 10 minutes that you pop out. And you get that horrible sticker left on your door.

 

Or the third thing is you keep ringing and call center, who eventually tells you that the courier has just had a really bad day, and it will have to be delivered tomorrow. And you go through to same exercise the following day.

 

So, anybody who has ordered online can completely appreciate why eight out of 10 customers are really dissatisfied with that approach. And 94% of volume globally is going through that approach.

 

We come at it slightly differently. Again, you can see this in the press, but more and more, ecommerce or last mile delivery companies are seeing this as the right way to go. We're saying, "Okay. Look. The real key to this is to give the consumer choice." Let them decide how, when, and where they receive their phone, their pen, their shirt, their CD, whatever they've ordered. How do they let them decide, give them the power of decision as to when to have it?

 

So, we're coming at the last mile piece a little bit differently. First and foremost, we're really narrowing that delivery window. Rather than saying, "It'll be delivered tomorrow between 9 and 6. We're saying maximum three-hour window, which in many parts of the world would be challenging in itself. But in Africa and the Middle East, it's even more so. But anyway, narrowing that delivery window, so at least you can predict or pick the timeslot you want.

 

Secondly and thirdly, and possibly far more importantly, we're looking at alternative delivery methods. We're really motivating and ramping up the number of deliveries that go through lockers. So, if you were coming to meet me today, Dustin, and you had ordered something, rather than saying, "Well, I can't meet you, Charles, because I'm waiting for a delivery," you could pick a locker location near to where I am, and you could pick it up on your way out, as in, when you wanted it. So, you choose where you pick it up.

 

And the third option and approach, and this is particularly relevant in Africa, using a lot more retail. We intend to have thousands and thousands and thousands of retail partners, making short distance between each one where consumers can pick up their orders. That does two things. It massively improves the customer satisfaction, so customer satisfaction goes up because consumer has the shipment when they want it and what's convenient for them.

 

But the other part of it and very good news for the supplier is that every time we make a delivery through a locker or a retailer, we're able the reduce our cost of delivery very significantly, which means we can make money, which allows us to reinvest in the solution and services so we can look at things like drones, curbside deliveries, and everything else besides.

 

It's really cool. It's really exciting. Again, the beautiful thing about this is that very few people are doing all of the above, and that means we get a fairly clear runway to create market leadership across Africa, and as I just mentioned, in the Middle East, where I'm sitting from today.

 

Thanks, Charles. Did we cover all the points you wanted to make today?

 

I think so, Dustin. That's fantastic.

 

Great. Thank you.

 

Mara Xpress

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About Charles Brewer

 

 

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Charles Brewer

Managing Director at Mara Sokoni

LinkedIn Profile

I interviewed Laurie Turnbull who discussed Risk Management - Reducing Liabilities with Contracts of Sale and Shipping Terms of Sale.

 

 

 

 

What are some current issues regarding risk management?

 

Great question. Especially today with the advent of globalization, so many companies are struggling with this issue of risk management. And one of the ones we commonly see is regarding the issues of contracts of sale between buyers and sellers. By that, I mean that quite frequently, you find buyers and sellers not doing contracts of sale. Very common for companies to launch a sales process with a purchase order, which in response, generates a purchase order acknowledgement. A lot of those are boilerplate documents where cut and paste companies have had them on file for a long time. And people don't always read them and update them for different sales transactions.

 

As a result, purchase orders and purchase order acknowledgements don't always cover many of the issues that would be in what we would call a contract of sale.

 

The companies that might be wondering if they fall into this area, a great place to start is to go to the website for the International Chamber of Commerce, for example. The International Chamber of Commerce publishes what they call a model contract of sale, which is a very basic document. It looks like a typical contract arrangement. It's not too formal, where a company indicates the buyer, the seller, signatures of the responsible people, describe the goods, any issues surrounding the sale, which might involve things like payment, ownership of the goods in an international transaction. Important things like Incoterms terms would be in the contract of sale.

 

The problem here is that many companies, if they do think of an Incoterm –for example, they are probably having an international transaction –they'll pick an Incoterm, and let's assume they do it correctly. As we know many companies don't do it correctly. But if they do pick the correct Incoterm, they supplement that with a purchase order and purchase order acknowledgement, but they still don't cover many of the other issues that can arise as liabilities in international trade, payment issues if product or goods don't arrive. What if the ship sinks? Do I still have to pay the supplier? What if there's damage in transit? When does ownership transfer? Is that an issue with the goods, for example?

 

And that's when you'd want to look at the contract of sale as an umbrella document. And from that contract of sale, you'd have a trickle down. From the terms and conditions, you'd specify the contract of sale, for example, you would then develop a purchase order, from which would flow the purchase order acknowledgements. And in those documents, you would nominate the Incoterm from the current Incoterms 2010 group of terms that would go with the transactions.

 

And that's a great opportunity to involve purchasing and logistics people. So, the issues of contracts of sale typically is one that the sourcing group looks at initially because they're typically the first people to reach the vendors and start looking at new products. And from that relationship, the purchasing arrangement flows. But there's a great opportunity here for procurement people to bring the logistics people into this group at that point in the transaction, and talk about things like loss, cargo insurance, Incoterms, and is there an opportunity, for example, for a contract of sale.

 

In what other areas do buyers and sellers overlook in the international sale of goods?

 

Another one that's often overlooked is on the legal side, and that's why it's overlooked, because many people involved in procurement and logistics would leave this is in the legal department in their company if they had one. Not every firm has a legal department.

 

But the legal issue, for example, of jurisdiction and venue. So, when companies engage in international sales, buyers and sellers do so, typically, with best intentions. They want the relationship to work. They want the order to be shipped on time. They want it to be received on time, and they have every intention of paying for the good within the stated terms of the sale.

 

But for whatever reason, with extended supply chains today, we see lots of opportunities for disruption. For example, typically, natural disasters today seem to be more common and goods don't arrive on time or arrive at all, or something else happens and the transaction, or the buyers and sellers end up in a dispute.

 

So, people don't start the relationship thinking about that. Buyers and sellers start the relationship thinking this is going to work. We're going to get the order. We're going to like the products, and we're going to pay for them. And if we're lucky, we'll be able to develop a longer-lasting relationship with this vendor.

 

But when things don't work out –and it's not that uncommon today, for whatever reason –often, the buyer and seller can end up in litigation. And that's an area where buyers and sellers don't think about that when they start the transaction process.

 

So, when something goes wrong, then that terrible specter of going to court arises, because one of the other parties, or both, are upset, and they can't resolve it. Then you have that group of people looking at the documents that they issued.

 

So, for example, the buyer starts to look at what they have on back of their purchase order. I'm in Canada at the moment, so let's assume we have a situation of a Canadian buyer, and they might have on the back of their purchase order something to the effect that if this doesn't work out and we end up in litigation, then we're going to go to court under the common law of Canada [inaudible 00:06:15] jurisdiction, and the venue will be in a court, for example, in the city of Ottawa, Ontario. And that's what they would expect the seller to agree to.

 

Meanwhile, let's say the seller is in Germany. The seller then turns over the back of their purchase order acknowledgement that they sent the Canadian buyer when they received the PO in Germany, and on the back of the PO acknowledgement, they put if this doesn't work out, we're going to go to the court under the laws of Germany and the venue will be in the court in the municipality of Berlin.

 

No one read those documents when they initially started the transaction. So, already, we have a problem. That's one of the issues, by the way, that would be resolved in a contract of sale, which addresses that fact by saying if the two parties have different legal systems and can't agree on where they're going to go to court if litigation ensues, then the International Chamber of Commerce points them towards the United Nations Contracts for the International Sale of Goods legislation, which also flows from the sample contract of sale, which basically says if the two companies, the buyer and seller, are in the contracting states of Canada and Germany, for example, then they would adopt CISG as the legal framework for settling their disputes rather than a dispute which would flow over where we should go to court, in Canada or in Germany.

 

You can just imagine the cost and expense of a Canadian company having to send people to Berlin to engage in litigation and hire a German lawyer or vice versa. A German company having to send people to Canada to conduct litigation in English and hire a Canadian legal firm.

 

So, the United Nation's Convention on the Contract for the International Sale of Goods, or CISG as it is called in the short form, is another area of jurisdiction and venue that companies rarely look at for the simple reason that nobody wants to think things are not going to work out. You want to obviously start the transaction with the best of intentions, and you hope that it will be a good relationship between the buyer and the seller.

 

Why do these issues occur and how can they be effectively addressed?

 

Mostly they occur because of lack of training, which seems to be a common element on both sides of the purchasing spectrum here, whether it's the buyer or the seller. It's very common for companies all over the world, regardless of what country we were in, what language we speak, it's common for businesses to start off small. If they're fortunate, they start to grow. And as they grow they add personnel as they need them. And of course, the initial focus is usually on sales. And then it becomes one of profitability, and then it becomes one of cost control.

 

Along the way, you start to acquire resources, including people, who can fulfill the various functions to help the company grow. But it's not the case where everybody in every company gets the same degree of training, but exposes them to concepts like International Chamber of Commerce, for example. Who would have that relationship in the company? It might be someone in the finance area or marketing and sales that goes to a chamber of commerce meeting.

 

It wouldn't typically be someone in purchasing and logistics. Who would be the person that would stumble across the UN Convention on the contracts for the international sale of goods, for example, had they not heard of it before? Typically, that would not be necessarily someone in logistics or procurement. And these are tactical people that carry out these transactions.

 

So training, making sure that you're bringing people into the organization, and logistics or procurement that are exposed to professional trade associations. There's a number worldwide. Every country, typically, has its own professional trade associations where people can get professional training. And along the way, they get exposed to these institutions and organizations, like chamber of commerce and the UN, and they specialize then in the kind of [inaudible 00:10:40] that can support them in the negotiating process.

 

It's critical today, especially with globalization. Since so many countries around the world joined the World Trade Organization when it was founded back in 1995, we're all dealing with issues of globalization. It represents wonderful opportunities for companies to extend their reach of sales around the world, and it also provides wonderful opportunities to reach out and meet new vendors and develop new supplier relationships.

 

But with extended supply chains go a fair amount of risk. And it's not just the simple risk of delay. People always think, "Oh gosh. I'm dealing with a supplier halfway around the world. When will my order get here?"

 

Transportation today has become fairly sophisticated. When it comes to ocean freight...for example, in North America, if you're dealing with vendors halfway around the world, if you put 30 days in a purchase order, give or take, you're going to be getting your good within a reasonable amount of time.

 

It's the other issues. It's what happens when the ship doesn't sail on time, or the container doesn't load because of the new cargo security programs that are being implemented around the world. Or a terrible situation where a ship sinks and the cargo is lost, and the buyer or the seller did or did not buy cargo insurance, for example.

 

Those are the issues that make it difficult to conduct trade. And the worst-case scenario, of course, is if you're unprepared for those, it spoils the relationship. And that's really at the heart of international trade for most companies, is finding vendors, finding customers, and building relationships that become long lasting.

 

You can spend six months to a year trying to develop a vendor, trying to develop a customer, and then, unfortunately, if you're lucky, you start the relationship off. You buy goods, materials, or you sell an order to a customer. And something unforeseen happens in global supply chain management that you're unprepared for, or that you hadn't thought through when you entered into the transaction, with the result that your customer, your vendor, or you become disenfranchised. You're very unhappy with the result. And it ends the relationship.

 

So, you can spoil that relationship in one order, which is a terrible situation to have happen, when it's the right company, the right vendor, the right customer, the right products, the right price, but we didn't know enough to think about cargo insurance. We didn't know enough to hire someone who could direct us in terms of picking the right Incoterm. We didn't think about a contract of sale to govern our transactions to make sure the interests of both parties were protected and moving forward.

 

So, those are the things that a lot of companies overlook. And lack of training, really, I think, is one of the most common reasons for that.

 

My last question is where have you seen success?

 

I work in the logistics industry for a third party, a logistics company, as you know. And we do a lot of work with customers, and not only our own employees but employees of other customers. And I'm involved in various educational, outreach programs, both in the field of education and also and the field of professional trade association.

 

So, where we often see success is when we're working with companies that have been a student, I have to realize that these are pitfalls in international trade. Globalization presents wonderful opportunities for organizations all over the world for growth. But it also presents tremendous opportunities for risk.

 

In order to adequately prepare for those elements of risk, you really have to not only recruit sourcing and logistics personnel with the right skill set, but you have to actively promote training as those departments grow, and even as those employees grow.

 

So, where we have seen success is where we see buyers and sellers that are not afraid to reach out and work closely and development good, working relationships with their intermediaries in the logistics industry. Not just rely on their own purchase order or their vendor's purchase order terms and conditions, but actively reach out and make sure that they have themselves the proper training. They stay abreast of the changes in the industry and make sure they're connected to the proper sources and information to monitor changing in the business, and develop strong working relationships with the freight borders and customs brokers.

 

And freight borders and customs brokers are, in some cases, unfortunately, looked upon as a classed element. These are the companies that cost us money as suppliers. That's unfortunate, because when it comes to international trade, freight borders and customs brokers all over the world typically represent... It's like every industry, there are better brokers or forwarders than others, and each have their own area of expertise in some cases. But generally speaking, these are the experts in the field, and these are the people that can steer buyers and sellers down the proper path in terms of how to prepare for every eventuality when it comes to international trade, particularly risk.

 

Companies are usually experts on their own, when it comes to buying and selling good that they manufacture or that they import or export. They've done that. They've become successful at it. They know how to make a widget, and they know how to convert that widget into another product.

 

But shipping that widget from Asia to North America to the United States through the port of Oakland, inland to Chicago [inaudible 00:16:41] midwest, that is not typically their area of expertise.

 

So, dealing with the compliance program, security programs, customs, freight or forwarding delays, the handling issues at the ports, transits times involved, dredge operations, getting containers in and up [inaudible 00:17:01]. These are also the areas that typically most companies are unfamiliar with the don't have a good appreciation for what the complexities are in terms of delay and cost.

 

A common situation after all of that, when you see all that play out, is the customer gets his or her goods, and unfortunately, they also get an invoice which has a lot of unforeseen charges.

 

And there's the proof in the pudding, if you will, that someone didn't really understand all the pieces of the process. When they get the invoice, and the person is looking at it saying, "My goodness. That's a lot more than I thought I was going to have to pay," which is not an indication that they can overcharge, necessarily, as much as it may be an indication that, "Gee, I really didn't understand all the pieces of this process, and if I had, I might have negotiated the price differently with my customer and my vendor. And I might have had different paperwork governing the transaction," which takes us back to where we started today with our conversation with documents like a contract of sale, for example.

 

Well, thanks, Laurie, for sharing today.

 

My pleasure, Dustin. A pleasure as always. Thank you very much for taking the time. I appreciated being with you.

 

 

About Laurie Turnbull

 

Laurie Turnbull is a supply chain consultant with Cole International Inc, specializing in supply chain management consulting and employee training and development. Cole International has been a leading provider of customs brokerage, transportation and warehousing services in Canada for over fifty years.

 

Laurie’s extensive background in supply chain management includes experience in both manufacturing and the transportation industry. He is actively involved in supply chain management education with the Supply Chain Management Association and the Schulich School of Business at York University in Toronto.

 

Laurie has been awarded the CCLP designation as a logistics professional by the Canadian Institute of Traffic and Transportation, and the professional materials management designation by the Materials Handling and Management Society of Ontario. He is a frequent speaker at industry events across Canada and a contributing columnist for Canadian Shipper magazine on supply chain issues.

 

 

 

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Laurie Turnbull

Supply Chain Consultant at Cole International Inc.

LinkedIn Profile

I interviewed Kees Van Der Vleuten who discussed Leadership and Governance Impacting Supply Chain.

 

 

 

Can you first provide a brief background of yourself?

 

 

Yes. I've been working more than 25 years in supply chain and procurement in a variety of industries, mostly related to complex industries. I have an educational background which was also in logistics and procurement, and I've been working with and for some of the most valuable companies around the world. And I have a pretty good understanding of where we're heading in supply chain management in the world.

 

 

Can you talk about what is leadership and governance pertaining to supply chain?

 

The last 3-4 years, I have been active in supply chain management and procurement as Chief Procurement and Supply Chain Officer . And I've also followed a study on corporate governance at Insead Business School. It's striking to me... There's a big connection between the internal governance and the external governance of a company. Did some investigation for an aerospace and defense company, and I found that the way you lead a company is directly influenced on the way you lead supply chain and vice-versa.

 

To my knowledge and understanding, I think supply chain is definitely a board topic. And the impact on bringing added value, not only to your customers but also to your suppliers, or from suppliers to yourself and managing the value chains within your company is quite a stringent topic.

 

And I believe organizing your supply chain organization and your structures in the company is part of the total governance of an organization.

 

 

How is it done effectively?

 

It differs a bit on the size and type of company and the industry you're in. I've seen great examples. For example, Vodafone  or Unilever or even Apple, who have taken supply chain to board level and making sure that added value comes from the supply chain function to the changing business models and the structures these companies are working on, especially when innovation and new product introduction as well as engineering is part of the game. A good example, of course, is Apple, who launches new iPhones and iPads. It has all the impact on having the right governance, the right structure in your company and making sure you fulfill the demand of the customer eventually.

 

 

Where have you seen some success?

 

It's pretty much depending on the company you're looking for. It's small pockets. Sometimes it's big. I've seen good examples at Inditex where Zara, the supply chain in fashion, is well organized at making sure collections are renewed every moment in time with a strong supply chain backup behind it.

 

You can also seen good examples in Philips, where I work myself, where now innovation and engineering is part of the game. But even in the past, Lucent, I remember in the electronics industry, has made a significant diversion in its supply chain by having a strict central governance and control of the supply chain management.

 

So, it's pretty much spread around. If you follow, for example, Gartner's Top 25, you will find the top companies moving on in supply chain management. I have also seen in another example in aerospace and defense, where I also have worked myself, great examples of value sourcing, including suppliers in the development and innovation of your components, and making sure you deliver on time, and making sure you add value to an aerospace customer.

 

If you look around the world, you will find them. If you dig in deeper, then the question is of course, how is the governance, the structure, the reporting lines, the mandates, how it is organized. And that can differ per company.

 

 

Do you have any final recommendations regarding leadership and governance impacting the supply chain?

 

In 2015, I wrote a nice article on leadership and procurement, which can also be applied to leadership in supply chain management. I myself have personally gone not a straightforward route. And I don't believe careers are straightforward. My first indication is to look beyond the boundaries of supply chain. Although being 25 years in supply chain, my interest always goes into other domains like finance, sales and marketing, engineering and innovation. I myself worked also in these environments through my 25 years.

 

So, look beyond the boundaries. That broadens your scope to actually set a better governance in the company on supply chain management. But also work in a diversity of industries. So, move around once in a while, because you get new insights. After my 20 years at Philips, I've seen other great examples in oil and gas, in the paper industry, in the fulfillment industry, where I said if I had known that at the time I was within the company, you could have contributed to maybe much better in supply chain and procurement.

 

And of course, personal development and curiosity by understanding how the dynamics within the company, but also between stakeholders outside the company works is, of course, one of the most important characteristics of a supply chain leader nowadays.

 

So, I believe if you want to build a good governance, then take away one of a few of these learning points and make sure you interact with the board, with the shareholders, with the board of directors, and even with your outside stakeholders like customers and supplies. And I think it's vital for companies to look at what I would call the value chain, which is a combination of procurement, supply chain, and all other stuff around it. Because eventually, when you launch new products or you want to bring in new innovations, it's not thinking in silos anymore. It's understanding the other side of the fence as well.

 

Eventually, you want to create value to the company from our supply chain perspective, as well as create a strong brand reputation. And I think supply chain can contribute to that.

 

 

Thank you for sharing today.

 

 

No problem.

 

 

About Kees Van Der Vleuten

 

 

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Kees Van Der Vleuten

Managing Director-VP Procurement & Supply Chain/ICT

LinkedIn Profile

I interviewed Marco Hazan who discussed Helping Shipping Lines and Container Operators with the Imbalance of Empty Containers and Repositioning Strategies.

 

 

 

 

 

 

What is the problem that shipping lines and container operators face today?

 

Well the shipping industry has been a complicated year, or at least couple of years. And uh, rates are going down or are at a very low part in these, especially these 2015. And that has taken this, shipping lines and container operators to be more concerned and aware of their operation and cost. And a big part of their operation and cost is related to the positioning of empty containers. So because of the nature of their business, each port means, each port turns into a surplus or deficit location most likely because they don't have the same amount of containers coming in that the amount of containers that are coming out of that same port. So they end up having surplus of containers in some ports and a deficit in others. And that brings them to the need of positioning in these empty units, to bring them from where they have a surplus to where they have a deficit. And on that it's a huge expenditure, basically the industry as a whole thing spent every year something around $16 billion US, just in using this empty unit from one port to another. And that's a big issue for them and there has been different approaches to this problem. But basically at some point you have to move the empty boxes from place to place. It has some environmental outcomes as well.

 

How can this problem be addressed?

 

Well one of the solutions that it's already there and we've seen is that some shipping lines and container operators like companies and those kind, basically sometimes they in very small clubs let's say, they know each other and they would call each other with asking them if they have spare containers or they have spare containers where they have surplus. So uh, in some cases they find this type of opportunities and they do what is called a one way exchange. Which is basically they borrow containers from each other and a company that has a surplus in a certain port would give those containers to someone who has a deficit at the same port that would return them to them and in a location that it's more useful than the original one. So basically both companies avoid uh, having to reposition this unit and the containers don't get moved empty, so they get moved with cargo.

 

Do you have any success examples?

 

Well yeah, we find those. We started being like, acting as a third party, neutral third party and independent from all shipping lines. Basically we're asking all of them or all the ones that are patriating with us about their inventory levels. So basically for each port if they have deficit or surplus. And then we start processing that information and trying to find these matching opportunities. When we start finding them, we start treating them opportunities in a blind manner, let's say without telling them whose the counter party that needs their surplus containers or vice versa. And um, once both parties agree on terms and conditions and on the same opportunity, then we release the information of who they are so they can do a one way direct exchange. And that has been proven successful so far. Today doing operations, we are having operations on a weekly basis and there's lots of opportunities to grow.

 

Can you provide a brief background of yourself?

 

Well I'm an industrial engineer and my basically, my experience comes from the management consulting industry. I had some past in some technology related businesses as well and then I got into retail and through retail I got into logistics and then I got deeper into logistics, being a customer for shipping lines, and that's how I got to know more about the shipping lines and the shipping industry. I got to see about this problem.

 

Great and thanks Marco, for sharing today on this important topic.

 

Thank you, Dustin it's my pleasure. Thank you really for the interest and for the interview.

 

 

About Marco Hazan

 

 

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Marco Hazan

Serial Entrepreneur | Investor

LinkedIn Profile

I interviewed Mortadha Jouini who discussed Moving from Academic to Professional World.

 

 

 

 

 

Can you provide a background or introduce what's involved in this transition from academic to the professional world?

 

 

Well, Dustin, thank you for giving me this opportunity. Well, to answer your question, I think that the transition between theory academia to professional life is a quite complicated question. In academia,students are exposed to theory courses, to exams, sometimes to practicum projects, to research work, but it's not what companies or what real life or this international business expects from us. In academia, we our target is to have an A or a B, to pass an exam. But real life is more about a--is a lot more about than that. When people will choose what college they go to they believe that at the moment they graduate, it's just over--life will be easy but I believe that at the graduation moment is just the beginning. It's the beginning of an improvement process that we need to follow during the whole career. It's not about having a diploma in engineering or supply chain management or whatever. It's about trying to be updated with the technological changes, with the business changes and--which means being a student for life. And unfortunately, what I feel today is that a lot of students believe that studying, making some research, stops--ends at the moment of the graduation. The other point is that even when we do some work placements or some internships, students are there learn about the job but not to learn about the work. We can be very good in what we do, but if we don't--if you're not aware about the professional environment, that can make a real integration problem. In this transition, we can't [inaudible 0:02:34.8] university. We can't have--if you're open-minded, you ask questions if we--try to make efforts to understand the professional environment. But believing that having A's in all subjects will make--will give the possibility to have a good career, I think it's not a good path. I don't know if that answer your question.

 

 

Is there any more you can talk about how things should be done to do this transition better?

 

 

Yes. I think there is--there is some work that has to be done by university teachers. The first duty is on academia people who are teachers. They need to explain to students that we're living in a very dynamic world and that--for--I can give you some example. Somebody today with an information technology diploma from 1990--what--I mean, what does it mean today? Technology has changed, has--it's developing very fast. So, if the person doesn't make efforts to be aware of all the technological evolutions, you will be just good for the 1990s--for the '90s technology but not for today. So, we need to explain to people that--to students that apprenticeship is a whole life--is a permanent process and the only thing that we can learn in the university is to how to--how to able to learn things rapidly and to be--to have the facility to be--to integrate in different environments. No more than that. But everything links, for example, to supply chain management, to I.T., to--I.T. background to management. Yes, it's good, yes, it's necessary but it's not the most important thing. Everybody today with the MOOCS can learn about--can learn these things in one week, in six months, but what we really--I believe what we really need to learn before all these things is--the difference between theory and professional life is that--is--I mean, also the human intercultural dimension, that's something that we can't--we don't--totally present in academia. And with these efforts, I think things can be--can change. Of course, students must make an--they--efforts and--when they're in internships, in work placements, they must--to be more open-minded and not to be there just to learn technology but learn all the other things link to the human dimension.

 

 

Do you have any final recommendations?

 

 

Well, yes, I can give some--for example, in supply chain management, we can take two students, both having master degrees in supply chain. After five years of career, what makes the difference from them, the experience, the choices they made for their careers? But if a person was a recruiter and if I have one student with certification. I can know that this person has more ability to be integrated and to be open to business changes. So, for example, trying to see professional certifications, trying to read updated books, trying to show that we are aware of evolutions linked to our working field, I think, can be good samples of being open to change and making efforts to have a good career.

 

 

Can you provide a brief background of yourself?

 

 

Yes. So, personally, I was a student in a engineering school in France. My first background is I.T., technical background. But at one point, I said--I.T. is good but it will be always a support field. So, my idea was to combine business with I.T. That's why I have added a master degree, international business with dimension of supply chain. Today, I'm working as a junior at Capgemini. And it's a position that gives me the possibility to couple my I.T. background with the supply chain processes in the business. I believe that in the 12 to 30 years coming, people need to have the double competency, combine I.T. with business.

 

 

And thanks for sharing today.

 

 

Thank you very much, Dustin.

 

 

 

About Mortadha Jouini

                                                                                                                                             

 

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Mortadha Jouini

 

Supply Chain Consultant at Capgemini

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I interviewed Rod Collins who discussed Why Most Organizations Struggle with Innovation.

 

 

 

 

 

 

 

M first question is regarding the pace of change. Can you talk a little bit about what changes are taking place and why is change pushing the need for innovation?

 

Innovation is becoming more and more of a strategic imperative for many companies. They struggle with the innovation because their traditional structures are not designed for innovation. In the media industry, Napster came along. Napster was a new business model that became possible because we now live in a hyper connected world, thanks to the internet and the networks. The traditional media organizations really mishandle what could have been a great opportunity for them by putting Napster out of business. That was there response. While they were successful with that,they couldn’t kill digital downloading. And so today, a computer company, Apple, is one of the largest names in music and the traditional industry winded up, you know, inadvertently ceding a lot of its business to those new businesses.

 

We're going to see this increasingly--let's take for example the field of financial services. We now have block chain technology coming about. Block chain technology involves distributed users within the financial service in industry that are forming their own networks which are calling into question the traditional ways that we have brokered the transfer of dollars between buyers and seller. The financial services industry is going to need to come to terms with this very new and different business model. I think if we look down the road; we could probably see that this would impact the healthcare industry and then as the whole internet of things become more and more of an everyday phenomenon.

 

There is another example of a network structure, just the other day, there was a report that some of the automotive companies and I believe Google is in this space as well, are designing technologies so that it's going to become difficult for cars to crash because the cars are all going to be talking to each to the technology of the internet of things. There's going to be a form self-organization, literally among the machines. This is an entirely different context for business. Traditional organizations struggle because they have a hierarchical design, they're not properly aligned to deal with this increasingly network world in which we live.

 

Can you talk more about why organizations haven’t come term with this?

 

The thing they struggle with and the reasons traditional companies had so much difficulty with innovation,is there are two key ingredients that are pre-requisites for innovations. If you look at some of the Vanguard Companies, which are companies designed as peer-to-peer networks rather than top-down hierarchies. Examples would be Google. Now the online game company Zappos is in that space. To some extend Amazons certainly Apple is as well.

 

These are places that are known for innovation and when go inside their organizations what you begin to see is that there tends to be a free flow of information and a free flow of ideas. If anybody saw the movie The Internship, a lot of it was filmed on Google's Campus. You could see that that is very different workspace compared to a typical office, because Google is designed as a network. Its designed so that people don’t work in cubes in offices but rather are more in open spaces and they work in teams and they're sitting together. All of that is to facilitate the free flow of ideas and the free flow of information.

 

Using Google as an example,again they have their famous 20% rule. Why does that exist? Well, Google puts that in place so that people can disobey the supervisors because normally for 80% of their work they are told to work on something. For 20% time, if they think its good idea, they're free to work on it in that space. Google set-up a company like that because they don't want to stop the free flow of ideas. Whereas, in hierarchies--because every supervisor has the ability to kill ideas, they are so dangerous. You don’t have the free flow of ideas. The other thing in hierarchy is they have this phenomenon known as, "The need to know." Well, in a networking environment, the basic assumption is everyone has the need to know as much as possible. So the free flow of ideas and the free flow of information are the ingredients that leads to serendipity that is often soil in which innovation happens because remember innovation is creating something that doesn't exist. Because hierarchies inhibit the flow of information and they inhibit the flow of ideas they are killing the two ingredients that fuels serendipity that made innovation possible. That's why they struggle. They're not design to be invade.

 

Are there any success stories or any examples that you could provide of how this is done effectively?

 

I think Google and Apple are probably the biggest examples. I mean, if you just look the way that they operate, you know, when you go into their office places, you're going to see a real emphasis on the team, you're going to see this free flow of information and ideas and I think the things they produce,the iPhone, iPad, Google Maps, Google Working on the Driverless Car, etc. I mean they're all beginning to come to the terms with the fact that we are going to live in a world in a decade or two where there is going to be Driverless Cars on the road. There will be drone technology for delivering packages. So I think the proof of the pudding, It is in the products that these companies are producing.

 

What are your recommendations for organizations that want to innovate?

 

The key recommendation is to transform their organizations into some form of peer-to-peer network. And that's harder. It’s easier said rather than done because it's a complete mind shift. It is a shift in how to lead organizations. At our firm Optimly Advisors we developed a service we call, "Collective Intelligence Dynamics." The purpose of it is to provide simulators to organizations. The simulators help us bring the network affect to both the data and human systems. To aggregate the collective intelligence contained both within the data systems and in human systems and to do those in discreet ways so the companies have an experience of how the network affect works.

 

Through these demonstrations it helps business leaders get familiarity with how different structures work. It would be a form of a dual operating system. That is a recommendations that John Connor has come up with. He's come up with an idea where he recognizes it is hard for people to--you know, especially those long histories of hierarchy to change overnight. And so he recommends that a second side by side system be set-up that operates according to network principles but is populated by the same people.

 

Our service collective intelligence dynamics, is a structured way in which to do that in a facilitated fashion. Some form of dual operating system is probably the thing that companies could do now. But I think that these dual operating systems are transition steps. 20 years from now I think the vast majority of business organizations will be some form of peer-to-peer collaborative network. For the simple reason that the world at large is structured as networks and networks are smarter and faster than hierarchies. If the companies don’t transform it is just a matter of time before somebody enters the market with a network structure and then just essentially takes over their business. If you want examples look at what happened to both Kodak and Blockbuster, who got left behind because they could not adjust to the network environment of digital transformations.

 

Thanks again for sharing Rod, and this is an exciting topic. And looking forward to a great future and innovated future for businesses.

 

Dustin it's always a pleasure to, you know, talk with you.

 

Thank you.

 

 

About Rod Collins

                                                                                                                                                

 

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Rod Collins

 

Author, Keynote Speaker, and Strategy & Innovation Expert at Optimity Advisors

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