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TIME (in Supply Chain)
 

TIME (in Supply Chain)

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Sergio Barbarino, Research Fellow Procter & Gamble, Supply Chain Innovation Center. ...

Sergio Barbarino, Research Fellow Procter & Gamble, Supply Chain Innovation Center.
Nouveaux comportements consommateurs, quel impact sur la Supply Chain ?
7ème Forum d'été Supply Chain Magazine / ESCP Europe, 11 juillet 2013

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    TIME (in Supply Chain) TIME (in Supply Chain) Presentation Transcript

    • TIME (in Supply Chain) Sergio Barbarino Research Fellow P&G Supply Chain Innovation Center.
    • Procter & Gamble Eurocor Sergio Barbarino My career at Procter & Gamble Quote Vague, but exciting! (M. Sendall) Personal - Age, 46 - Living in Bruxelles - Rower - Sommellier -MBA Solvay 2004 -Master Chem Eng. 1991 -UNINAPOLI @ University 2011 Research Fellow, SNIC 2007- 2011 – Principal Engineer Process Breakthrough -Started the First Global Supply Network Innovation Center 1991-2007 – Various Positions as Process Development Engineer - Brands: Mr. Clean, Viakal, Tide, Lenor, Fairy - Plants: Europe, China, India, Egypt, Morocco, Mexico, Guatemala, Russia etc. - Locations: Brussels, Rome, Cincinnati
    • 3 P&G at a Glance Net Sales $84 (billion) Number of Employees 127,000 Countries of Operations 80 Countries Where Our Brands Are Sold 180 Consumers Served by Our Brands 4.4 billion R&D organization 9,000 R&D spending $2.2 (billion) (Approximate)
    • Copyright © 2011, P&G. L Deketele. All rights reserved. P&G network in Western-Europe P&G Logistics operations in WE • 30 plants • 15 regional DC’s • 50 storages for finished products • 60 customization centers
    • Copyright © 2011, P&G. L Deketele. All rights reserved. P&G Finished Product Flow “Normal flow” PLANTPLANT PLANT DCPLANT DC REGIONAL DC REGIONAL DC RETAIL DC RETAIL DC RETAIL SHOP RETAIL SHOP SHOPPER
    • Inventory = Money Most of the talk is not about the actual physical cases… Please ask the Biblical Pharaoh of EGYPT if Inventory is a good or a bad thing…. Please ask yourself when sitting on a Toilet if that extra roll you keep there just in case is a good or a bad thing 6 Thesis
    • [Optional slide for additional info/data] 0 20 40 60 80 100 120 140 160 180 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 billioneuro EUROPE GAINS to 70% : Eur160 Billions 1.3% CO2 footprint Inefficiency – Where the real money is %Load Factor %empty truck (km) %Road efficiency
    • FACT Slow steaming 8 “ We just start production a week before”
    • FACT Just in Time…. 9 How to apply it correctly?
    • FACT Goods average travelling speed is slow… no matter how fast the mean of transport 10
    • Supply chains inefficiency Transport inefficiency is a €160 Billions loss and 1.3% of EU27 CO2 footprint!!! Full, but only 25% of weight limit 60% empty, but at weight limit
    • P&G TINA CUBE Mixing light & Heavy Products 3. EFFICIENCY Light goods: Only 25% of weight limit Heavy goods: Only 40% of volume limit
    • 13 Why stay within one company?
    • Heavy Light Only one Ideal combination : Combine Heavy Light – Create optimal density for a vehicle drive same weight fill % and vehicle fill % - UP! Horizontal Collaboration - Fill External opportunities & challenges
    • Easy to handle, transport, store, interlock, load, construct, dismantle & decompose Smart tag enabled + sensors Standard sizes & dimensions Unit loads along entire supply chain Common communication, planning & monitoring Optimised space Open networks & pooled resources Less network complexity Modular box system Interconnected comms Modular logistics units New handling & storage technologies Co-operative logistics networks Modular dimensions from cargo container size to tiny Keyattributes Potential PI savings: 22% freight km 50% CO2 15% efficiency 20% loading Save CO2 New modular load unit concept Smoother interfaces along the supply chain – create a more efficient, sustainable supply chain by using new modular load units & smoother supply chain interfaces Vision Smooth interfaces along the supply chain • Within inter plant operations • During trans-shipment What is the Physical Internet Vision ?
    • π-Concept | Positioning the Physical Internet. Source: Montreuil (2012). 16
    • TRANSPORT COLLABORATION
    • Cooperation experiment Going to the beach 18
    • Going to the beach 1 person3 persons 4 persons 19
    • Rules of cost/benefits sharingShapley value is easy to calculate…;-) •It is based on a company’s marginal contribution to groups of other companies: •Shapley value is the only gain sharing concept that satisfies all the following fairness properties: Efficiency: The complete savings of collaboration are distributed Monotonicity: If player A adds more value to every coalition than player B, player A will get a higher payoff Dummy: A player that adds no value to any coalition, will receive no payoff Symmetry: If two players add exactly the same value to every other coalition, they will get the same payoff Individual fairness: No player will suffer from collaboration (cost level after collaboration is not higher then individually, i.e. without collaboration)
    • A competitive advantage! Shapley solution? The new Passenger should pay 50% of the costs 1)The single passenger is now paying as if he is sharing with another passenger 2)The group of 3 are now paying as if they were 6 passengers sharing the costs ! ☺☺☺☺ Note that: a scale of 6 is physically IMPOSSIBLE if you do not COLLABORATE
    • Another asset underutilization of transport in Europe…
    • People Mobility insights
    • Footprint of Traditional Shopping CO2 emitted by supermarket shopping Consumer trip (transport between home & store) Packaging (store - shopping bag) Retailer operations (store/ DC /transport) Manufacturer operations (DC/ transport) Source: LCA study, P. van Loon, J. Dewaele, L. Deketele - Heriot-Watt University / P&G 30 items/shopping basket - UK B&M supermarket - typical (average) travel behavior (distance, transport mode)
    • Estimating the hidden costs of a shopping trip Travel cost >400 eur/annum (car tco) Time >50 hours(ex trip) Finding/Picking >100 eur/annum -> An hidden budget to fund Home Delivery?
    • Direct to Consumer Delivery: a big sustainable businessDirect to Consumer Delivery: a big sustainable businessDirect to Consumer Delivery: a big sustainable businessDirect to Consumer Delivery: a big sustainable business opportunityopportunityopportunityopportunity •Value Creation for Consumers: Less car trips=Less cars!Value Creation for Consumers: Less car trips=Less cars!Value Creation for Consumers: Less car trips=Less cars!Value Creation for Consumers: Less car trips=Less cars! •Return logistics possibilities (e.g. higher package recycle)Return logistics possibilities (e.g. higher package recycle)Return logistics possibilities (e.g. higher package recycle)Return logistics possibilities (e.g. higher package recycle) •Produce AFTER Demand (Produce AFTER Demand (Produce AFTER Demand (Produce AFTER Demand ( ----> Cash Flow relief!)> Cash Flow relief!)> Cash Flow relief!)> Cash Flow relief!) •Brand loyal consumers can get subscriptions (E.g. Pampers, Toothbrush, Razors, etc. etc.)…and theBrand loyal consumers can get subscriptions (E.g. Pampers, Toothbrush, Razors, etc. etc.)…and theBrand loyal consumers can get subscriptions (E.g. Pampers, Toothbrush, Razors, etc. etc.)…and theBrand loyal consumers can get subscriptions (E.g. Pampers, Toothbrush, Razors, etc. etc.)…and the best prices.best prices.best prices.best prices. •New Service Jobs CreationNew Service Jobs CreationNew Service Jobs CreationNew Service Jobs Creation Issue is: Scale is essential for the last mile to be efficient.Issue is: Scale is essential for the last mile to be efficient.Issue is: Scale is essential for the last mile to be efficient.Issue is: Scale is essential for the last mile to be efficient. AroundAroundAroundAround thethethethe WorldWorldWorldWorld HeritageHeritageHeritageHeritage PostalPostalPostalPostal companiescompaniescompaniescompanies ownownownown thethethethe mostmostmostmost capillarycapillarycapillarycapillary networknetworknetworknetwork.... AAAA fewfewfewfew ofofofof themthemthemthem ((((DHL,DHL,DHL,DHL, BBBB---- Post)Post)Post)Post) havehavehavehave declareddeclareddeclareddeclared strategicstrategicstrategicstrategic totototo developdevelopdevelopdevelop itititit forforforfor goodsgoodsgoodsgoods deliverydeliverydeliverydelivery asasasas traditionaltraditionaltraditionaltraditional mailmailmailmail servicesservicesservicesservices declinedeclinedeclinedecline.
    • Opportunity: ALICE! Freight Transport Modes - Intermodality Air Rail Road Waterborne Freight Freight Freight Freight Sustainable Chemistry Manufacturi ng Forest-based Manufacturi ng ALICE THE ETP on Logistics Industrial sectors- Manufacturing Foundation Science & TechnologyTextiles& Clothing Manufacturi ng Steel Manufacturi ng FoodforLife Manufacturi ng Foundation Science & Technology Logistics + Supply Chain How to Transport What to Transport The connection between Modes and Industrial ETPs for Optimized Logistics and Supply Chain Management
    • 29 Barbarino.s@pg.com