A presentation by Bronwyn Engelbrecht, Strategic Sourcing Manager, Busby, South Africa and Gerrit Fourie Btech Industrial Engineering, Divisional Executive for Supply Chain Solutions, Santova Limited, South Africa. Delivered during the 38th annual SAPICS event for supply chain professionals in Sun City, South Africa. The strategic partnership between The House of Busby and Santova Logistics proved that significant time and cost benefits can still be realised in modern international supply chains. Applying joint optimisation principles the team realised a 17% annualised actual cost saving, as well as a 20% improvement in ex works to primary DC lead time performance. The presentation explains the strategy, approach and execution that resulted in the business benefit of a complex Supply Chain environment, actively sourcing from 60+ ports into 20+ active divisions. Attendees will take away practical examples of the improvement initiatives, relevant to multiple industries.

1. Organisations often don’t
consider International Supply
Chain to be a skilled function,
but rather a service function
to the business
INTERNATIONAL LOGISTICS – THE VALUE OF VISIBILITY AND
COLLABORATION
“A committed partnership built of respect and trust, orchestrating skilled and dedicated people who accept
accountability.
Each party practices excellence with simplicity reaping quantifiable rewards with longevity. The critical enemy
being complacency.”
This document exposes the journey that Busby initially and later Busby with Santova travelled to achieve
mutual benefit through a long term symbiotic relationship. Various challenges occurred and the way these two
organisations faced, and jointly overcame, the obstacles provide multiple lessons to organisations in similar
situations.
1 SETTING THE STAGE
In the beginning, there were the fraternal twins, “Peril and Opportunity”. There was a lack of visibility, and
inbound cargo was crisis managed. Information while abundant was scattered and miscommunicated. .
Service providers were plentiful and expensive. In summary, a regular situation faced by fast growing medium
sized enterprises.
Like the foundations of any environment, whether a family, political or organisational, stability was required.
The period of stabilisation took 3 months before implementation of the strategy
commenced.
As this process started in January of 2012, we had six months to make the
changes that would have a significant positive impact on the business prior to
peak season.
2 STABILISATION
Stabilising the environment required an understanding of the current process
and structure. The weak areas needed strengthening and the neglected areas
needed the appropriate focus. We approached this in three steps:
2.1 CONTEXT (Seek to understand before being understood)
2.1.1 Participants (Knowledge, Experience & Culture)
Time was spent with each internal individual to understand their role as they understood it in the
International Supply Chain Department. Special attention was paid to their:
 knowledge relevant to international cargo movement
 experience in moving international cargo
 understanding of their deliverables in relation to their job description
 view about the culture of the Busby environment

2. Clients often do not realise
the benefit of combining
their information with that of
their service providers, jointly
there is a wealth of
knowledge.
The TO –BE process was
explained to the team
members and they
contributed to the final
detailed process by adding
their suggestions on the
brown paper every day.
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The various service providers were interviewed, and information was requested.
2.1.2 Footprint (Mapping Our Sourcing Footprint)
We drew data from the various service provider’s systems to find out how much cargo, by value and
volume originated where. This helped us understand the size of the business from a freight value
perspective, and gave us insight into which of the multiple service providers performed the best against
the following requirements:
 Data accuracy and completeness
 Level of experience relevant to our industry
 Current Volume
 Capability and service offerings not being utilised
This gave us our first look at our Strategic Sourcing picture, which turned out to be incomplete It would
take another six months to understand only 80% of the volume was mapped.
2.1.3 Risk
Through this process a risk profile started to emerge. We compiled a risk matrix, prioritising the risks by
cost and efficiency, allocating the tasks to individuals with strict deadlines. At this stage we were three
months away from peak season where process and structure changes were not feasible, all changes had
to be implemented and stabilised prior.
2.2 STRUCTURE
2.2.1 The Process (Identifying the gap)
Now that volumes were understood, it was imperative to understand the
current process of moving this cargo. We held process workshops for an
hour before work every day for a week, and mapped out the AS-IS
process.
This was quickly followed by mapping out a high level TO-BE process
based on best practice and basic understanding of the other elements of
Busby supply chain, DC capabilities and order management requirements. It was written on brown paper
and hung on the office walls. This was not done in conjunction with the internal ISC (International Supply
Chain) department for the following reasons:
 The level of relevant knowledge was virtually non-existent
 The experience was limited
 There was a culture of “this is the way it has always been done”
The TO-BE process at this stage was temporary and without substance and measureable KPI’s acting as an
intervention from a risk mitigation point of view with limited optimisation objectives. It was however
simplified, logical and executable.
2.2.2 Department Structure
The structure within the ISC (International Supply Chain) Department was
based on a traditional freight forwarding model that was already being
identified as non-effective by forward thinking freight forwarders. The
department was split into three operational sections, forwarding, clearing

3. IF THEY WEREN’T MY SERVICE
PROVIDER THEY WOULD HAVE
BEEN MY FRIENDS, deal with
people that are easy to get along
with.
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Enable people to execute
their function, then you can
judge their performance.
The mind-set change of being a
SERVICE department with key
deliverables and accountability
of on time deliveries, was the
first step in the overall culture
change of the department
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and transportation planning. There were multiple touch points,
limited communication, and no visibility of shipment status or
progress.
2.2.3 Expertise and Knowledge
The resources in the structure lacked depth of knowledge and performed clerical functions which were
ineffectual causing frustration across the brands. Late arrival of cargo was easily blamed on ISC
department, with no knowledge to refute failures, and to identify the actual route cause and address it.
2.3 STRATEGY
Subsequent to the three months spent understanding the environment
an ISC Strategy document was presented with an implementation plan
and a commitment to an organisational deliverable. We also listed a set
of investments required from the organisation.
The strategy focused on the areas highlighted in the completed risk
matrix.
2.3.1 Defining the Role of The International Supply Chain
(ISC) Department
The ICS department’s role was defined as
“An internal service provider that is responsible and accountable for the movement of international cargo
from source to the primary back door to support the requirements of the Brands. It needs to provide
visibility, reliability and efficiency ensuring that costs and service levels are reasonable and competitive. “
A new structure for the department was presented that would
support the above role.
2.3.2 Service Provider Selection
The negative impact that the inefficiencies of the ISC had on the
business meant that we did not have the luxury of time in selecting
a service provider. We relied on the past relationships with our
current services providers, chose the potential untapped capability
that best suited our requirements, then trusted our instincts when it came to the right fit to the culture
and values we envisioned for the future ISC Department’s deliverables. This decision was made easier
through the Footprint exercise conducted.
We made a recommendation to partner with SANTOVA LOGISTICS (then known as Impson Freight) for
the following unique reasons;
 They had a system that was user friendly, with an integration written into our internal ordering
system allowing instant visibility of the cargo they were already carrying for us.
 They had a positive, pro-active historical relationship with The House of Busby
 They were dynamic in their approach to freight management and were eager to push the boundaries
of the accepted norm
 They were passionate about their, and our, industry

4. Junior Controllers were paired
with Senior Controllers in an
“apprenticeship” programme
forming a succession planning
initiative.
[SIDEBAR TITLE]
People do business with people,
not logos, posters or slogans.
Cohesion drove MUTUAL
operational growth, excellence,
revenue and profit growth
2.3.3 Investment Requirements
We requested a single senior controller based on the volumes as well as three pronged training:
i. Theoretical training through formal institutions
ii. In-house training by the Group Shipping Manager
iii. ”On the job “training of junior controllers by senior controllers and management
The proposal was accepted and more importantly supported by the executive body.
3 STRATEGIC IMPLEMENTATION
3.1 Department Structure
The recommended structure of the ISC department was implemented,
strengthened by experienced controllers with international supply chain
knowledge. A channel type structure was deployed, where dedicated
teams were assembled to manage a specific cargo route, thus providing a
single point of contact for the business creating visibility, reliability and
efficiency. This type of structure focuses on the product and demands of
the Busby environment rather than the traditional isolated movement of
cargo.
The channel further acts as a conduit between the LSP and the Busby
Supply Chain teams in the Distribution Centre, Outbound Order
Management delivering against the expectations of the Brands and
consumer.
3.2 Service Partner Integration
Ensuring the successful integration of Santova, as the selected service
provider, was crucial to achieve the set objectives. We would work very
closely with them over the next three years, and virtually every day over the
first twelve months. The success that we have achieved today can be
attributed to the following key areas:
3.2.1 Aligned Culture
Values, personalities, enthusiasm and work ethic. All of these aligned
and created a work environment that formed a foundation to achieve the goals that were, and are still
being set.
3.2.2 Skills
Santova had a depth of skills both in international freight logistics and supply chain management. Their
business had a positive reputation in the industry as well as a positive but arm’s length history with The
House of Busby. These skills were successfully combined with the
knowledge and skills of the Busby team to achieve the results
witnessed today.
3.2.3 Capabilities
Intersecting capabilities emerged which complimented both
organisations. Santova had a web based system that would provide
accurate, live visibility together with a depth of skilled controllers and
supply chain resources whose experience and knowledge we could
leverage instantly.

5. The Customer was identified as
The Brands of Busby – not the
Busby Shipping department –
Busby ISC and Santova is an
integrated team with a common
operational deliverable.
Rate negotiations revolve around
volume and consistency benefits
while adhering to the service
levels. Typically measured as a
percentage of the freight as a
trend instead of cost per
handling unit.
The House of Busby had volume and a significant sourcing footprint that would allow Santova to venture
into new routes and increase the base cargo significantly.
3.3 Operational Implementation
Once the environment was stabilised we focused on two primary areas, operational execution and cost
optimisation.
Santova was nominated as our preferred service provider and all volume was routed through their network.
Using their system standard reports were developed that mapped freight volume and customs value, per
brand and division by month allowing for trend and exception analysis. The network was complex and the
opportunity to make a significant impact on the operational performance
while at the same time reduce freight cost per unit was exciting.
3.3.1 Operational Execution
 An integrated workshop was held with the operational teams
from Santova Logistics and the newly structured team from
The House of Busby. A joint mission statement and
operational process were defined, documented and accepted.
Through this our skill sets were enmeshed and strengthened.
 We focused on efficiencies and speed to market, setting KPI’s
and defined communication rhythm between the teams and
to our common customers – The Brands
 Tasks were allocated to individuals and not organisations or
departments.
 Metrics were clearly defined and by 2014 we had mechanisms to measure all of them.
 Our information sources and metric measurements allowed us to identify target areas and
Strategic Sourcing is developed as a function within the organisation.
3.3.2 Cost Optimisation
 Key cost drivers were identified and prioritised based on their
alignment to the overall service objective.
 Critical source points were identified and through the
management of the cost drivers direct cost reduced and overall
efficiency optimised.
 Mechanisms were developed to track volume profile changes
to continuously optimise the efficiency and cost management
 Carriers are measured jointly and negotiations are shared
based on service vs. rate intersects
 Multimodal cost advantages are identified and leveraged
 Risk of costs due to inefficiencies are mitigated in the form of extended detention days with the
carriers
4 ENSURING LONGEVITY
Both parties need to believe in the longevity of the relationship to warrant effort and investment, in these
situations the rewards take time to realise, but are infinitely more sustainable than short term solutions.

6. WHAT WAS RIGHT YESTERDAY
IS NOT RIGHT TODAY, AND
DEFINITELY NOT RIGHT FOR
TOMORROW.
The partnership develops continuously, and the scalable platform allows less time to be spent on repetitive
activities and more time on improving the results of the platform. This does not happen on its own and
constant attention is needed to ensure the circle of TRUST, APTITUDE, INSPIRATION AND RESPECT is
maintained. The following activities have been instrumental in achieving this.
 Annual joint operational workshops – there have been years when we thought we should make it bi-
yearly, and after we have the workshops we are astounded at the outcomes we take back into
practice. This is because resources change, positions change and people like to socialise with
individuals they have contact with every day but do not see. It is critical for relationship building.
 Clearly defined levels of communication: - this is defined in the work document. Controllers talk to
controllers, managers to managers and strategic executive to one
another. Finance talk to finance.
 Clearly defined responsibilities – by position and name for both
parties
 Constantly, and honestly, measuring our activities, both large and
small. Allowing the data to be analysed by other members in the
teams gives fresh insight.
 Corrective actions – Historical decisions are constantly being
reviewed based on new findings or changes in the environment.
 Kill the egos – there are no holy cows in this environment, robust
debate is encouraged and sought to ensure optimal solutions.
 Challenge the status quo – what was right yesterday is not right
today, believe that more than anything else we have written or
presented.
5 THE EXCELLENT SIMPLICITY
• Adaptability
• Understanding
• Application
• Motivation
• Goals
• Reward
• Embedded
• Reliability
• Accountability
• Earned
• Mutual
• Consistent
Respect Trust
AptitudeInspiration

7. Looking back, there were a few “game changers” that made the world of difference in our delivered results:
 Understand the real issues – DO NOT believe perception, challenge the perception through investigation
and analysis, removing constraints managing the perception
 Data integrity is crucial to drive targeted optimisation.
 Do not let the small errors slide – “What is inspected will be respected”
 Remove duplication and focus on excellence (Understand the internal bottle necks and realise the impact
of trust)
 Set short terms goals that align with the long term objectives. Measure, fix, measure again fix again,
result. Theory in practice.
 Celebrate achievements – especially the small ones
 Experiment boldly within boundaries
6 COMPLACENCY – THE ENEMY WITHIN
Constantly probe, ask internally focused questions to ensure continuous improvement. The external
environment dictate that yesterday’s correct decision is not the answer for tomorrow’s challenge.
Constantly initiate new projects, both large and small to challenge both the staff and environment. If you do
not have any projects defined you are fooling yourself into thinking your situation is optimal.
Invite your network in, only through openly sharing knowledge, strategies and information can the situation
be improved. Both the client and the service provider is crucial to the others success.
7 SHARING THE BENEFITS
Ultimately the relationship is only viable if both parties obtain reward for the significant effort invested.
The below table provides a high level outline of the benefits achieved by the parties in a symbiotic
relationship.
CLIENT SERVICE PROVIDER
Reduced ISC cost per unit Increased Economies of scale
Improved visibility – predictable planning platform Industry sector knowledge
SC Stability Volume footprint expansion
SC Predictability Service expansion
SC Adaptability – scalable platform Revenue
Effort
Compromise
Reward

8. 8 SUMMARY RESULTS
Through,
 INTELLIGENT PARTNER SELECTION
 RELATIONSHIP CONTINUITY
 THE VALUE OF EXCELLENT SIMPLICITY
 AVOIDING COMPLACANCY,
the joint operational team realised a 17% annualised actual cost saving as well as a 20% improvement in ex-
works to Primary DC lead time performance consistently.
The relationship is two things, EQUITABLE AND SYMBIOTIC