A leading international consultancy document summarizes logistics strategies for meeting the challenges of a clean, low-carbon world. It discusses the global context of climate agreements and low carbon pathways. It then examines how logistics can meet this challenge through various strategies like avoiding unnecessary transport, shifting to cleaner fuels and technologies, and improving efficiency. The document provides examples of these strategies and new technologies that can help decarbonize freight transport by 2050 as demand is projected to quadruple.
1. a leading international consultancy
FUTURE-FIT LOGISTICS
MEETING THE CHALLENGE OF A CLEAN, LOW-CARBON WORLD
CATHERINE WEETMAN MSC FCILT FRSA
JUNE 2018
2. 2
1980 1990 2000 2010
Catherine Weetman MSc FCILT FRSA
Senior Consultant, SCALA Group
Mentor, Circular Economy Club
Vice-Chair, Environment & Sustainability Forum,
Chartered Institute of Logistics and Transport UK
Visiting Fellow, The Business School,
University of Huddersfield
MSc Logistics and Distribution, Cranfield
University, UK
Work Study
Engineer
Industrial
Engineer,
Distribution
Distribution
Planning Manager,
GB, later Europe
Project &
Implementation
Manager, Retail
Product
Implementation
Director
Appleton Thorn Ltd
(now Solving Efeso)
Senior Consultant
United Transport Logistics
Project Manager,
Commercial Department
3. 3
FUTURE-FIT LOGISTICS
MEETING THE CHALLENGE OF A CLEAN, LOW-CARBON WORLD
Global context
Paris Agreement & low carbon pathways
How can logistics meet the challenge?
4. “EVERY FEW hundred years in Western history there occurs a
sharp transformation. Within a few short decades, society -
its world view, its basic values, its social and political
structure, its arts, its key institutions - rearranges itself.
Fifty years later there is a new world. And the people born
then cannot even imagine the world in which their
grandparents lived and into which their own parents were
born.”
Peter F Drucker,
The Post-Capitalist World, Harvard Business Review 1992
6. 6
WHY DO EMISSIONS MATTER?
Source: Trucost, ‘Natural Capital at Risk’ April 2013
Globally, transport accounts for:
• 28% of energy demand and
• 23% of CO2 emissions (carbon
dioxide)
In 2014, the transport sector
consumed 65% of global oil
final energy demand
Source: International Energy Agency Catalysing
Energy Technology Transformations - Part II (webinar
slides) Licence: www.iea.org/t&c
8. 8
“There remains a substantial gap between what governments have promised to do
and the total level of actions they have undertaken to date.”
“Furthermore, both the current policy and pledge trajectories lie well above
emissions pathways consistent with the Paris Agreement long-term temperature
goal.”
Source: Climate Action Tracker, November 2017 The emissions that drive this warming are often called Baseline scenarios
(‘Baselines’ in the above figure) and are taken from the IPCC AR5 Working Group III.
11. 11
INTERNATIONAL FREIGHT VOLUME & EMISSIONS QUADRUPLE BY 2050
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
CO2 2010 CO2 2050
MILLIONTONNES
CO2 EMISSIONS
Air Road Rail Sea
0
50000
100000
150000
200000
250000
300000
350000
2010 2050
BILLIONTONNE-KILOLMETRES
FREIGHT VOLUME
Air Road Rail Sea
Source: ITF International Transport Forum, press release 27 January 2015
12. 12
FUTURE-FIT LOGISTICS
MEETING THE CHALLENGE OF A CLEAN, LOW-CARBON WORLD
Global context
Paris Agreement & low carbon pathways
How can logistics meet the challenge?
13. 13
3VECTORS FOR IMPROVEMENT
Source: World Business Council for Sustainable Development, Road Freight Lab
www.wbcsd.org/Clusters/Climate-Energy/Road-Freight-Lab/Resources/A-Low-Carbon-Freight-report-under-WBCSDs-LCTPi
IMPROVE
22. 22
EFFICIENCY –TECHNOLOGY ENABLERS
Siemens eHighway is a reliable and environmentally friendly alternative to standard truck transport that
supplies trucks with power from an overhead contact line.
This means that not only is energy consumption cut by half, but local air pollution is reduced too, making
the technology twice as efficient as internal combustion engines.
Siemens eHighway, Press Release, 2017-Sep-19
www.siemens.com/preswww.siemens.com/pres
IMPROVE
23. EFFICIENCY –TECHNOLOGY ENABLERS
Image: Popular Science The Volvo Platoon participating in the 2016 European Truck Platooning Challenge
Volvo/European Truck Platooning Challenge
IMPROVE
27. 27
SCALA CONSULTING
Sourcing and Procurement
Supply Chain
Management
Logistics Operations
Best Practice and
Benchmarking
Top Quality Team
Leaders in international supply chain and logistics
Independent Objective Expertise
Offering detailed knowledge of supply chain and best practice
Technical Skill
Range of supply chain modelling and benchmarking tools
Improve Processes
and Operations
Reduce
Costs
Reduce
Working Capital
Improve
Product Availability
Improve
Customer Service
Increase
Sales Margin
32. WHAT ARE THE NATIONAL CIRCUMSTANCES INFLUENCING DEEP DECARBONIZATION IN THE UK?
• The concept of deep decarbonisation has been recognised in Government strategy documents
since 2003. In 2008, a long term goal to reduce GHG emissions by at least 80% relative to 1990
levels was legislated, and an independent advisory body set up.
• While the institutions have been established, the necessary policy package is not yet in place to
meet the stated ambition
• From a technological perspective, the UK is in a favourable position to deliver a low-carbon
energy system, with strong offshore renewable resources and existing nuclear power capacity.
• The challenges of diminishing fossil fuel resource base, ageing power generation sector and low
efficient building stock make the low-carbon shift an obvious strategy for the UK. The
document concluded that ‘meeting these policy challenges can be delivered at moderate
additional cost, with multiple economy-wide benefits’
WHAT ARE THE MOST PROMINENT STRATEGIES FOR DEEP DECARBONIZATION IN THE UK?
• The UK strategic plan sets out four 5-year carbon budgets, from 2008 to 2027 and the
necessary actions across the sectors to achieve a 50% GHG reduction by 2027
• To deliver the carbon budgets, a strong push on power sector decarbonisation will be needed.
This could be delivered by different generation technologies, and will require large scale
investment
33. 33
The Climate Action Tracker (CAT) is an “independent scientific analysis produced by three research
organisations tracking climate action since 2009. We track progress towards the globally agreed
aim of holding warming well below 2°C, and pursuing efforts to limit warming to 1.5°C.”
The highway to Paris - CAT analysis on safeguarding the climate by decarbonising freight transport.
Deep Decarbonization Pathways Project World Business Council for Sustainable Development –
Road Freight Lab www.wbcsd.org/Clusters/Climate-Energy/Road-Freight-Lab/Resources/A-Low-
Carbon-Freight-report-under-WBCSDs-LCTPi
Low Carbon Technology Partnerships initiative https://lctpi.wbcsd.org/
Hyperloop Frequently Asked Questions
A Circular Economy Handbook for Business and Supply Chains: Repair, Remake, Redesign, Rethink,
by Catherine Weetman, 2016 ISBN 978-0-7494-7675-5 Also available in e-book format
FURTHER RESOURCES
37. 37
Founded in 2001 – has developed an excellent industry reputation
Driving Supply Chain & Logistics Improvements
Experienced and highly knowledgeable team
Strong management backgrounds
Senior board level to detailed operations implementation
Independent objective expertise
Range of Supply Chain modelling and benchmarking tools
SCALA CONSULTING
38. 38
OUR SERVICES
Strategic Product Sourcing · Vendor Performance Management · Negotiation
Training · Cost Reduction · Strategic Manufacturing
PROCUREMENT
SUPPLY CHAIN
Demand Driven Supply Chain · Sales & Operations Planning · Supply Chain
Planning · Customer Service
BEST PRACTICE
Grocery & FMCG Best Practice · Home Appliance Best Practice · Retailer Best
Practice · Cost and Service Performance Benchmarking
LOGISTICS
Outsourced Logistics · Logistics Network Design · Transport Optimisation
Warehouse and DC Design
40. 40
CONSULTANCY PROJECTS – LAST 6 MONTHS
Major UK Discount Retailer
distribution optimisation
modelling (own fleet, sub
contract, outbases, fleet size &
mix, delivery schedules…)
Logistics Outsourcing
assessment & review of
contingencies following
change of 3pl partner
solution
Automated Warehousing
solution proposal for parts
after sales care - global car
manufacturer
Invitation to Tender
end to end management
Demand Driven
implementation of demand
driven process & supporting
systems
Cost to Serve model
Set up & implementation of a
pilot CTS model
Network optimisation
modelling for servicing of HM
Prison Service
Market RFQ & opportunity
assessment for large scale
national Primary transport
operation
Warehouse strategy & design
following acquisition of two new
businesses
Logistics Strategy & ITT Mgt
to support wholesale supply
agreement to major UK
Convenience retailer
UK greenfield DC Design
850k ft2 including very
significant levels of automation
CONFIDENTIAL
CLIENT
41. 41
THE SCALA TEAM
Plus a Range of Specialist Associates and Partner Companies
Tim CookJane Green Biao WangRoger Quemby David ShortLeigh Marklove
Catherine WeetmanBob DiplockRob JohnstonePhil Jones Alison HoltJean-Pierre Carraud Conor O’Loughlin
Paul BebbingtonDavid Battye
Dave HoworthJohn Perry Alison HobsonKeith Newton John PotterPhil Reuben Rob Wright David Grahamslaw Tiger Wang
Leo Shen
Andy Yang Tyson Liu
43. 43
GROCERY FORUM 2017 TO 2018
2017
• Cost to Serve
• Market fragmentation and its implications
• Supply chain KPIs
• Distressed stock cause and management (including FareShare
presentation
• 4PL control tower webinar
• Apprenticeship levy
• Supply chain roles
• E2E supplier/retailer initiatives
Hot Topic
Discussions
• Visit to new ASDA DC in Wigan
• Retailer presentations from Dean Jackson and
Chris Hall (ASDA), and Gavin Chappell (Dunelm,
ex. ASDA Supply Chain Director)
Retail Speakers
and Visits
• Ed Sweeney (Professor of Logistics at Aston University) – Future of
Logistics and Supply Chain
• Senior SCALA Consultant – Warehouse Automation
• Senior SCALA Consultant – Greenhouse Gases Measurements
• Autologic – warehouse management software
• Microlise – latest on in-cab technology, fleet optimisation, and the
future of driverless vehicles
Expert
Industry
Speakers
2018
• Demand Planning Best Practice
• Supply Planning Best Practice
• Brexit
• 3PL Procurement Best Practice
• Customer Engagement – what does “good” look
like?
• Plus other hot topics decided by members
Hot Topic
Discussions
• Top 6 (Co-op, Sainsburys and ASDA confirmed)
• Discounters
• Visit to B2C fulfilment centre or 3PL innovation
centre
Retail Speakers
and Visits
• As always a range of expert industry speakers
to discuss various issues and trends
• IBP overview (why all the fuss and failure)
• Food standards and supply chain risk
Expert
Industry
Speakers
44. 44
SCALA manages three Best Practice Forums for Grocery manufacturers, Home Appliance suppliers and Retailers.
Senior Delegates participate with the aim of sharing industry best practice and seeking opportunities for learning and collaboration.
SCALA works with our member companies to ensure that, in a perpetually changing marketplace, their supply chain and logistics operations embrace the most optimal
practices within the industry to achieve leading cost and customer service performance.
• Four Quarterly meetings per annum
• Two attendees per company
• Member input to discussion topics
• Industry Expert guest speakers
• Major Customer guest speakers
• Industry Surveys on “Hot Topics” and company requests
• Members only Website
• Dynamic Discussion Forum
• Access to all presentations from meetings, data and survey results
• Annual Benchmarking of costs, performance and customer service
• Promoting industry innovation and new ways of working and
sharing of learnings and experiences
• Enhancing understanding of customer requirements,
developments, trends, and regulations
• Increasing operational effectiveness and performance
• Driving supply chain and logistics sustainability
• Identifying barriers to improvement
• Identifying opportunities for collaboration between companies
• Dialogue opportunities with customers
• “Peer to Peer” networking
SUPPLY CHAIN BEST PRACTICE FORUM
Membership Entitlements Membership Benefits
45. 45
SCALA’s supply chain benchmarking involves top multinational companies and allows them to compare their performances with similar organisations and
competitors from their own market sector and other complementary sectors. Cost and Service Performance Benchmarking are approaches that have proved
hugely beneficial for businesses wishing to improve their efficiency, as well as looking to cut down on costs.
The SCALA methodology and benchmarking comparisons are
annually based and incorporate more than 40 different key
performance indicators (KPIs) encompassing forecasting, inventory,
customer service, primary and secondary transport, warehousing
costs, and performance ratios.
COSTS AS % OF SALES
Proven Benefits
• Identification and quantification of improvement
• Understanding best practices
• Comparisons with peers and competitors
• Focus on key priorities
• Year on year comparisons
• Profile of strengths and weaknesses
• Detailed cost and service comparisons
CUSTOMER SERVICE
SCBPF - BENCHMARKING
46. 46
SCALA acts as the “Trusted Neutral” for our clients
All data and results are entirely confidential and all reports and findings are totally anonymous
SCALA then works with the clients to help them identify solutions and achieve business benefits.
SUPPLY CHAIN PERFORMANCE PROFILE
Proven Methodology
• Over 15 years’ experience
• Tailored for individual sector
• Detailed consistent data collection templates
• Process of data validation and verification
• Provide meaningful comparisons between
companies
• Establish where companies are good and areas they
could improve
SCBPF - BENCHMARKING
47. 47
SCALA MODELLING CAPABILITY
Strategic & Operations
Assessments
Sourcing &
Manufacturing
Warehousing
Facilities
Inventory
Modelling
Sophisticated
Warehouse
Simulation
Detailed
Vehicle
Routing
Transport
Movement
Customer Service
– Availability &
Order Lead Times
Sales & Return
Volumes
Regional Facilities
& Staff Costs
Vehicle Capacities,
Speeds
Product &
Demand Profiles
Sourcing Lead
Times & Quality
RISK ASSESSMENT COST TO SERVE –
CUSTOMERS &
PRODUCTS
TOTAL SUPPLY CHAIN
COSTS
SITE LOCATIONS FLEET TYPES &
NUMBERS
SUPPLY CHAIN
RESOURCES
VISIBILITY OF IMPACT
OF “WHAT-IFS”
48. 48
SCALA ANNUAL DEBATE
IN ASSOCIATION WITH
“Retail Supply Chain
Developments”
“Why isn’t
Collaboration
Working?”
“The Most Significant
Supply Chain Changes for
The Next Ten Years”
“Attracting Top Talent into
the Supply Chain & Logistics
Industry”
“Do Logistics Companies drive
Supply Chain Improvement for
Retailers and Manufacturers?”
“Can Collaboration improve On
Shelf Availability?”
“Investing in the Supply
Chain – or Cost Cutting”
“Supply Chain Environmental
Efficiencies”
“Logistics Efficiencies”
“Larger 3PL’s –
Customer
Benefits”
“Reverse Supply
Chains”
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2015
“What is the Key to
Delivering World Class
Service in the Future?”
“What are the supply
chain priorities for the
next twelve months?”
2018
2017
“Is Supply Chain a
Competitive Advantage or
just a Support Function?”
2016
“Who is driving future
improvements in supply
chain and customer
service?”
49. 49
SCALA CONSULTING
Sourcing and Procurement
Supply Chain
Management
Logistics Operations
Best Practice and
Benchmarking
Top Quality Team
Leaders in international supply chain and logistics
Independent Objective Expertise
Offering detailed knowledge of supply chain and best practice
Technical Skill
Range of supply chain modelling and benchmarking tools
Improve Processes
and Operations
Reduce
Costs
Reduce
Working Capital
Improve
Product Availability
Improve
Customer Service
Increase
Sales Margin
50. Click new modes What other innovations might we see?
Click cycle cargo is growing in lots of cities, particularly those with emission control zones
Click collaborative networks are starting to appear - we're probably familiar with some of these,
including Uber Cargo in some cities. In the UK, Shutl integrates with existing parcel courier
networks to provide cheaper ways to get rapid deliveries
Click another form of collaboration is peer to peer or crowdsourcing, connecting people who are
travelling with those who need something delivering. For example, commuters can earn money
by delivering a parcel on the way to work
Click Pipeline systems, using highly efficient Maglev, magnetic levitation technology, are being
developed. Virgin has recently invested in the Hyperloop One project. It will move people and
goods over long distances at very high speeds, 2-3 times faster than high speed rail and with a
much smaller civil engineering footprint.
in Northampton, UK , Mole Solutions is developing an underground and overground MagLev
pipeline, using disused railway lines to move goods from out of town consolidation centres into,
and across the city.
Click We see modes based on electric power, including electric vans & bikes, Parcel robots or
Automatic Ground Vehicles, and drones. Some predict that drones will deliver 80% of all “last
mile.” items https://www.wbcsd.org/Programs/Energy-Circular-Economy/Climate-Energy/News/The-transport-revolution-when-science-fiction-becomes-business-reality
