Page 9 - Case Study Annual 2018
P. 9

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
         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
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