This document discusses digital transformation in logistics. Technologies like big data, analytics, AI, IoT, and robotics promise to transform business operations by raising quality, increasing flexibility, and boosting productivity. However, digital transformation is challenging for large, established companies not born in the digital age. The document proposes using design thinking to understand problems and leverage team capabilities to become more consumer-driven, digital, and willing to break from the status quo. It also recommends a simple framework for digital transformation in logistics focusing on foundations, integration, and collaboration. Finally, it discusses deploying global analytics for logistics by starting with pilot markets and key metrics before global rollout.

1. digital transformation
in logistics
Leonardo Marins
Deployment Lead Marketing Transformation Programme
Former Global Logistic Development Lead
British American Tobacco
Christophe Kerhoas
Global Logistics Performance Manager
Former Head of Supply Chain
British American Tobacco

2. Disclaimer: The views expressed and materials presented represent the personal views of the authors and
should not be taken to represent the opinions, policy, or views of British American Tobacco.
Copyright: All rights reserved. This material may not be published, broadcast, rewritten or redistributed in
whole or part with out the express written permission.
Contact leonardo_marins@bat.com or christophe_kerhoas@bat.com

3. The digital world is disrupting the industry and moving Logistics to
forefront of business strategy enhancing consumer experience [1] [2].
Apple, Amazon, Ocado, IKEA... have pushed the bar higher.
[1] https://www.gartner.com/doc/3847509/logistics-revolution-navigating-route-ahead
[2] https://www.mckinsey.com/business-functions/operations/our-insights/digital-transformation-raising-supply-chain-performance-to-new-levels

4. Big Data, Analytics,
AR/VR/MR, IoT,
Robotics, AI, Digital
Biology:
collectively, these
technologies promise to
transform business
operations, raising quality,
unleashing new levels of
flexibility and boosting
productivity [3].
[3] https://www.mckinsey.com/business-functions/operations/our-insights/operations-blog/ops-40-the-human-factor-recognizing-the-capability-challenge

5. Therefore, this is not
simple for big companies
not born digital. We urge
for a new set of
professional, consumer
driven, techie/digital,
passionate, bold enough to
break status quo
http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/culture-for-a-
digital-age

6. • Let’s cover how Design Thinking can help understand the problem to
leverage the team capabilities, to become more consumer driven,
techie/digital, passionate, bold enough to break status quo.
• Get insights on a simple digital transformation framework in
Logistics – foundation, integration, collaboration – to avoid the team getting
lost, bombed by tech buzzwords, without clear direction, it helps organise the
ideas into projects and connect with IT.
• Share experience deploying Global Analytics for Logistics, taking
advantage of global operation, setting key metrics, blending data with partners,
fixing data issues, using pilot markets to build cases before deploying globally.

7. WELCOME
Let’s cover how
Design Thinking
can help understand the problem to leverage
the team capabilities, to become more
consumer driven, techie/digital, passionate,
bold enough to break status quo.

8. Design Thinking
exercise made by 6
students of Stanford
Business School,
course LEAD for
Corporate
Innovation.
Focus on use of
digital technology
for Supply Chain
and Logistics

9. Larry start his career in Logistics when 18, he
is now 38 and believe Logistics is not a
stressful business.
Logistics are “old” guys, vast majority male,
some grumpy, they carry a paper agenda,
they take notes in the paper, they believe
digital is a new Casio watch.
Here is Larry!Look!!!
They lost my
container
again

10. Larry doesn’t know how powerful is his smartphone
Trello, Planner, Slack, Keep, Microsoft Teams, Cloud,
SharePoint, WhatsApp...
Excel is Larry’s guru.
Larry believe Cloud is to store files like in Drive C/:
he keeps creating version with different names v1, v2
he attach files in email to share
he doesn’t trust people can update the document together
Larry loves excel, emails, attachments
Why Not?

11. Larry mindset is ‘incremental’ not ‘exponential’
10% versus 10x approach
https://hbr.org/2016/07/how-to-create-an-exponential-mindset https://singularityhub.com/2016/04/05/how-to-think-exponentially-and-better-predict-the-
future/#sm.000v646wx12nscocscl1wrmb89yrh

12. WELCOME
Get insights on a simple
digital transformation
framework for Logistics
– foundation, integration, collaboration – to avoid the
team getting lost, bombed by tech buzzwords, without
clear direction, it helps organise the ideas into projects
and connect with IT.

13. 1. foundations
control over inventory availability
and inventory efficiency, supported
by data integrity with in and out
process controls measures
2. integration
event tracking
smart sensor, smart devices, robotics, drones, 3D
printers, automation, virtual/augmented reality…IoT.
decision flow
blockchain, AI and RPA
performance
analytics, predictive analysis, prescriptive analysis,
root cause analysis
3. collaboration
all parts connected, synchronised,
enabling joined decisions supported
by a shared platform with
tracking visibility at the full supply
chain
digital

14. 1. foundations
control over inventory availability
and inventory efficiency, supported
by data integrity with in and out
process controls measures
Inventory
Availability
the ability to delivery on time in
full at the right cost
Inventory Efficiency
the ability to manage right level
of inventory at right place
Data Integrity
mechanisms to improve data
accuracy and completeness

15. • look at technologies available, build a portfolio of trials
• start with small initiatives, scalable, replicable, let them experiment
• be open to co-work with start ups
• should I stick a sensor in my pallet or let the carrier/LLP do the tracking?
• ability to share real-time data? do I need real-time? if I need what I do with?
• smart glasses at warehouse picking? no we are not that complex
• image recognition? I like it
• will drone succeed in last mile urban area? do I need a drone to run inventory count?
• self-drive vehicle? up to carriers

16. • decision in process, not post-mortem examination
• based on events or predictive analysis, generate alerts or automate
basic decisions
• risk management, missing OTIF, shortage, out of stock, take decision before it happens
• software companies versus logistics companies
• ETA for your containers flow?
• how to gain confidence on automated decisions?
container temperature
weather condition
strike

17. • this is a revolution, start now, even with your crappy data
• be careful, it expose inefficiency
• core metrics first, OTIF, premium freight, vehicle fill rate, cost, carrier usage, vehicle type
• enabling root cause analysis operated locally
blending data
dashboards
mobile

18. Carriersmanufacturer
logistics
companies
vs
software
companies
carriers
commercial relationship
freight price
transport demand transport management
connected with several carriers
expertise, transport system, scale
long term contract based on service
level and gain share
transport executionaudit, billing
sharing
economy
sharing transport
sharing warehouse
(fulfilment centers)
sharing labour
software companies vs
logistics companies
were born digital
artificial intelligence
predictive/prescriptive analysis
automated decisions

19. recruit right, combine
business and IT profile
stop fighting IT vs Businessstart ups are different
• build a portfolio of projects, start small think big
• learn fast via experimentation, accept fail
• do, because is the right thing to do, wait for accurate business case may be too late

20. Share experience deploying
Global Analytics for Logistics,
taking advantage of global operation, setting key
metrics, blending data with partners, fixing data
issues, using pilot markets to build cases before
deploying globally.

22. Agree on
Global metrics
Run Pilot with
EMs
Sign-off
reports
Roll out
Globally

23. Metrics
Pilot EMs
Agree on
Global
metrics
Run Pilot
with EMs
Sign-off
reports
Roll out
Globally

24. Agree on
Global
metrics
Run Pilot
with EMs
Sign-off
reports
Roll out
Globally

25. Agree on
Global
metrics
Run Pilot
with EMs
Sign-off
reports
Roll out
Globally

26. Agree on
Global
metrics
Run Pilot
with EMs
Sign-off
reports
Roll out
Globally

27. Start small with Quick & Easy win(s)
Engage and Include End Users
Roll out – One voice of the truth
Automatize reports

28. digital transformation
in logistics
Leonardo Marins
Deployment Lead Marketing Transformation Programme
Former Global Logistic Development Lead
British American Tobacco
Christophe Kerhoas
Global Logistics Performance Manager
Former Head of Supply Chain
British American Tobacco