Page 9 - Case Study Annual 2018
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Thought Leadership
first global logistics hub in Jakarta, Indonesia and response to changes. Minimised time to
to build and grow their country and wealth for market from order date is more critical. Cash
the people. to cash cycles are far shorter. These result in
Add the Dutch sailors’ expertise in lower pipeline inventory, best utilisation of
cartography, giving them supply chain trucks and increased profit through supply
visibility and changing ‘exploration and chains. Just like the VOC, exploiting managed
adventure’ of the time (a synonym for not global logistics creates market delight and
knowing where you are going) into effective value.
route planning, understanding of delivery lead It’s interesting that logistics service
times (long as they were) and so the ability provider funding for assets and working
to forecast demand and supply through their capital may still be less innovative than the
supply chain network – the start of advanced VOC model. Perhaps it’s time for the Internet
th
planning. And this was the 16 century. and less formal banking to create some
Given this lead in logistics and successful innovative future-thinking start-ups in our
trade in its supply network, the VOC still had industry – owned ‘by the people’ and not
to stay competitive. It needed to introduce via government. Managed privately – people
new products and categories while home- private partnership.
based traders sold same-old local goods, An innovation not felt by the VOC is Green
relying on discounts to lock in customers and Supply Chain, a truly recent market dimension.
volume. New products from the East were The move to certified organic products, not
cheap from the Asian and African sources just any product, requires sophisticated batch
and differentiated their product and service tracking and tracing, plus data rich, correct
offering, making high profits back home. ‘First information and messaging on packaging.
mover’ advantage was still the difference Traders must provide proof of organic
between wealth, survival and poverty as sources, socially acceptable manufacturing
other nations built ships for the same routes. and distribution processes, plus proof of
Getting home first meant new products acceptable carbon counts and water usage.
subsidised locally sourced product margins, Green consumers want to know not just how
winning locally traded products’ market share the product got to them, but the reverse
as well as basket-of-goods trading. logistics and recycling that the producer
Success was measured in lead time, applies to minimise waste such as packaging.
condition of stock and health of crew, so One simple result of this is coffee counters like
hitting port first was a must. Communication Seattle selling refillable travel mugs to regulars
was so delayed that ship captains’ knowledge to replace one-use cardboard cups.
of markets and their customers’ needs For the future, this means more direct-
mattered in the selections they made to-consumer delivery based on very recent
for second choice goods if the first was demand. We need hybrid trucks with zero
unavailable 6,000 kilometers from home. emissions, maybe even tax on waste, and
Moving forward to today, cost, value and plenty of IoT and IT to enable, sense change
profit are the valid measures. Cost of product and optimise everything.
is paramount, regardless of where it came In summary, trade logistics started as
from. Sourcing at a lower price and importing the by-product of empire building and the
still requires best or lowest cost logistics to near cousin of military logistics. Moving
deliver competitive landed prices. Buyers from efficiently feeding and arming an
want more interesting, relevant and quality army (efficient in time, but not in cost) to
products delivered in the best condition competitively serving diverse product ranges
and lowest price. Some product costs are via global supply routes to market, where
now actually cheaper than their transport delivery method, condition and convenience
to markets. Effective logistics is taken for have become as important or even more
granted today as part of the augmented important than the product itself.
products consumers demand – an integral The VOC case study proves that we can
part of the product’s value. still learn from past processes using these as
As logisticians in an even more competitive a launch pad for innovation, comparisons and
world today, we use ERP and logistics delivering customer satisfaction. Time to go
software tools to enable optimised planning forth and innovate. •
The Logistics News Case Study Annual 2018 7
