Creating Customer Value End-to-End via Supply Chain Innovation
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Presentation given at the 2016 Supply Chain Insights Global Summit - 7-9 SEP 2016 at The Phoenician in Scottsdale, AZ Creating Customer Value End-to-End via Supply Chain Innovation • Edwin Wenink – Programme Director, Royal FloraHolland New business models require the rethinking of traditional processes for transportation and sourcing. Royal FloraHolland a cooperative flower exchange sources flowers globally and runs one of the world’s largest auctions to deliver flowers globally. In this presentation, Edwin tackles the problem of redefining transportation to support a global process of handling a time-sensitive cold chain product. While flowers started in Holland with bike delivery, Edwin and his team have redefined the flower supply chain for the Royal FloraHolland auction to work seamlessly across ocean containers, 3PLs and value-added service operators in the supply chain. To see the video go to http://supplychaininsightsglobalsummit.com/2016-summit-presentations/
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Creating Customer Value End-to-End via Supply Chain Innovation
- 1. 9/24/2016 September 2016Supply Chain Insights Global Summit #Imagine2030 Edwin Wenink Royal FloraHolland Programme Director
- 2. 9/24/2016 September 2016Supply Chain Insights Global Summit #Imagine2030 Creating Customer Value End-to-End via Supply Chain Innovation Edwin Wenink Royal FloraHolland Programme Director
- 3. Product Value 24 September 2016 3
- 4. 60 Import Countries Top 5: Kenya, Ethiopia, Israel, Belgium & Germany 24 September 2016 4
- 5. Royal FloraHolland a Cooperative 24 September 2016 5
- 6. Main commercial facts 24 September 2016 6 • €4.6 billion euro turnover • 12.5 billion flowers and plants yearly • 20,000 varieties • 115,000 commercial transactions daily
- 7. 140 Export countries Top 5: Germany, United Kingdom, France, Italy, Belgium 24 September 2016 7
- 8. Traditional Supply Chain 24 September 2016 8 (Inter)national market segments LSP LSP Auction & Traders Hubs 10% 90% 2% 98% (Inter)national sourcing locations
- 9. People, Plan(e)t, Profit 24 September 2016 9
- 10. Inspiration, Vision & Innovation 24 September 2016 10
- 11. Innovated Supply Chain 24 September 2016 11 (Inter)national sourcing locations LSPAuction & Traders Hubs LSP (Inter)national market segments
- 12. Flowers@Sea 24 September 2016 12 Airfreight versus Sea freight Kg CO2 per ton product Costs Nairobi - A’dam 9.200 kg Costs airfreight $ 18.768 Costs seafreight $ 11.950 Costs savings seafreight $ 6.818 - 36% CO2 Kenya - A’dam CO2 by air 43498 CO2 by sea 5653 CO2 savings in % -87%
- 13. The importance of partners 24 September 2016 13 Growers Buyers Logistics service providers Knowledge institutes
- 14. Mental Shift 24 September 2016 14 Innovation means that you see, what others also see, but that you subsequently do, what no one else did before
- 15. Supply Chain Projects 24 September 2016 15 Operational Tactic Strategic F@S (Near) Future Horizontal Collaboration between Shippers “Instead of company to company competition, we are now in an era of supply chain to supply chain competition” 2004, Professor Hau Lee, Stanford University of California Short Mid Term Long
- 16. Strategical 5 PL Tactical 4 PL Operational 3 PL Non Competitive Collaboration Platform: Horizontal Shippers Collaboration Development of new logistics concepts Next level in Supply Chain
- 17. Critical Success Factors of Collaboration 24 September 2016 17 1. Formulate concrete and tangible goals 2. Start simple step-by-step 3. Commit sufficient resource capacity 4. Address behaviour and trust. 5. Long term commitment 6. Stress good communication 7. Clear governance and decision making 8. Agree in advance on financials 9. Evaluate and update agreements 10. Agree in advance on way partners access or resign
- 18. Let us work together and collaborate 24 September 2016 18
Editor's Notes
- Edwin Wenink Programme Director Royal Flora Holland
- CUSTOMER VALUE in the case of FLOWERS is in The QUALITY of the flowers; delivering at minimum 7 DAYS of VASELIFE An ACCEPTABLE PRICE LEVEL And SUSTAINIBILITY in the case of the DELIVERING of the product to the end customer I would like to TALK in this MATTER about: CO2 REDUCTION but also REACHABILITY of Cities LIFEABILITY But before GOING INTO DEPTH, I would like to COME BACK to these FLOWERS
- If we talk about the DUTCH CONTEXT, Can you IMAGINE that these flowers could come out of 60 DIFFERENT COUNTRIES And that these could be SUPPLIED by 4413 different GROWERS world wide and That these growers are RESPOSIBLE responsible them selves of the SUPPLY of these goods to FloraHolland? HOW COME?
- FloraHolland is a COOPERATIVE The ownership lies with our 4.000 members, growers who own the company. Members, Customers and Employees 4.000 members, 631 of them non-Dutch 2.439 customer 3.051 employees FLORAHOLLAND offers a MARKET PLACE for these cooperatieve members to SELL their PRODUCT
- And we EXPORT to 140 different countries GERMANY is the most important, with an export value of 1.557 million in 2015
- If you look at our TRADITIONAL SUPPLY CHAIN This SC is UNABLE TO MEET the REQUIREMENTS set out on: Price level Sustainability Quality Airfreight is to expensive, to polluting And no quality control Truck is also not optimal So we NEEDED INNOVATION
- So the question is: How can we create CUSTOMER VALUE throughout the Supply Chain Taking into mind 3 key drivers: PEOPLE PLANET PROFIT And if the AMBITION is. A QUALITY PRODUCT with VASELIFE GUARANTEE A SUSTAINABLE Supply Chain An AFFORDABLE PRODUCT We have to come up with NEW SOLUTIONS and INNOVATIONS for the future. There for we needed to think OUT OF THE BOX
- As EINSTEIN already said WE CANNOT SOLVE OUR PROBLEMS WITH THE SAME THINKING WE USED WHEN WE CREATED THEM. This is one of the REASONS why I have been very ACTIVELY SEARCING for NEW IDEAS OUTSIDE MY OWN SECTOR. And that is why I am ALSO VERY EXITED that I can PRESENT HERE today. P&G thinks ALIKE
- THEREFORE we did SEVERAL PROJECTS: Rail Barge Deep Sea All these innovations met our standards concerning People Planet Profit THE RESULTS of these multi modal solutions are: A QUALITY PRODUCT meeting consumers EXPECTATIONS We are able to keep to product fresh CHEAPER and more SUSTAINABLE alternatives But also More COOPERATION between STAKEHOLDERS A lasting MENTAL SHIFT
- Here you can see the SAVINGS . Perhaps for you NOT VERY NEW and NOT SO MUCH INTERESTING. In our sector however these DEVELOPMENTS are a REVOLUTION. TRANSPORT OF FLOWERS BY SEA???? Can this be DONE. -> SURE IT CAN! But can you even IMAGINE the SCEPSISME we had to OVERCOME. -------- So by SHARING this with you. I wanted to STATE that INNOVATION in the Supply Chain CONTRIBUTED highly to DELIVERING VALUE to the customer. But what I ALSO want to SHARE with you today is my LESSONS LEARNED. INNOVATION and CREATING value in the supply chain can ONLY be ACHIEVED by: Technologic Innovation Proces innovation Social innovation / working together Rest of my presentation I would like to go in MORE DEPTH on what I see as the BASICS of INNOVATION and as a NECESSITY for FUTURE.
- First of all coming back to the SEA FREIGHT EXAMPLE For ACHIEVING This INNOVATION in the SC WE needed the RIGHT PARTNERS. PEOPLE -> RIGHT KNOWLEDGE PEOPLE -> RIGHT ENERGY And PEOPLE who WANT INNOVATION to work It is all about COOPERATION BETWEEN PEOPLE And we had a WONDERFULL COOPERATION with a company you know well CHIQUITA
- This and other PROJECTS gave me an IMPORTANT INSIGHT PEOPLE and their WILLINGNES TO WORK TOGETHER, to CHANGE and to ADOPT to new INNOVATIONS make all the difference to bridge the gap between SUCCES and NO SUCCES But the biggest lesson was: No INNOVATION without a MENTAL SHIFT or SOCIAL INNOVATION Key Factor: you need to INVOLVE the PARTNERS and their EMPLOYEES So INNOVATIONS is NOT ONLY: - having the right process - having the right technology It is more about having the willingness to change and adapt My Secret weapons in doing the projects: KISS -> equipment -> infrastrucur, knowledge A clear concept Use of professionals and Involvement of the companies Understand -> same objective of goal Use of psychologist
- Looking at the FUTURE, I see a need for much MORE COOPERATION. Not only the WILLINGNESS of PEOPLE to adapt, but especially the WILLINGNESS of COMPANIES to work together, I feel this is most easily done in a NON COMPETITIVE ENVIRONMENT but it can also be done in a competitive environment. As HAU LEE stated it. “Instead of company to company competition, we are now in an era of supply chain to supply chain competition”
- And how does this LOOK LIKE. SHIPPERS should unite on a 5pl level! DEVELOPING new concept, routes: finding out how to balance, bundel and synchronize transport flows. Make clear what your business objectives are Make sure that you also organise this on a Strategic Tactical and Operational level. So you have to discuss about Governance, pain and gain sharing, etc. So very key in this matter is that shippers take full responsibility!!!! Shippers can not give this to a service provider, shippers have to do it themselves. And if shippers do not have the competences in house. They should hire people who have these competences. This is the only way to get to the next level in logistics. Do not ask what your service provider can do for your company, but ask yourselve what can you do for your service provider so that your services provider can perform the yob that you require him to do; executing an excellent Supply Chain.
- The last thing I wanted to share with you today; our 10 lessons of succesfull collaboration.
- This brings me to the end of my presentation: Please keep in mind. It is our mind which makes the difference! So let us start working together and show shippers and people all over the world how cooperation and the adoption of Supply Chain innovations delivers true value end to end