DHL Supply Chain: technology in Manufacturing Logistics
Mike Bristow, MD of Manufacturing Logistics at DHL Supply Chain UK & Ireland, discusses how the company and industry are evolving amidst significant technological change.
As the world’s leading contract logistics provider, DHL Supply Chain is well-renowned in the supply chain space. DHL is one of the largest 3PL providers in the sector and covers a range of industries such as automotive, planes, trains, boats, general engineering and construction. Supply Chain Digital speaks with Mike Bristow, MD of Manufacturing Logistics at DHL Supply Chain UK & Ireland, to find out more about Manufacturing Logistics at DHL and the current state of the industry.
Can you walk us through your role and what it entails?
I’m responsible for a wide customer base across the broad manufacturing sector in the UK.
The focus of my role boils down to four key areas. Firstly, it’s important that we look after our colleagues and effectively engage them in the business. Secondly, we need to listen to our customers, anticipate their business challenges and understand how the supply chain can add value to their overall organisation in pursuit of their objectives.
Thirdly, we need to deliver for our shareholders and grow the DHL business sustainably. And finally, we need to act responsibly, minimising our impact on the environment and the local communities in which we operate.
Can you talk us through your manufacturing solutions?
I’m passionate about delivering solutions to British manufacturers to increase throughput and efficiency, while improving the order-to-cash cycle. In its simplest form, we offer solutions across the entire supply chain. We manage the inbound flow of materials from around the world right up to the point of fit, which includes sequencing and pre-assembly of parts. This significantly improves manufacturing efficiency, as well as helping control inventory, build variation and complexity.
The scale of DHL enables us to group network supplier collections and the transport flows for our various customers. Many component suppliers will produce parts for multiple manufacturers and our network drives significant efficiencies by joining the volumes together. We also move finished products from the point of manufacture to the end customer. As part of our finished goods expertise we also manage fleets on behalf of our clients, from company cars to press and test vehicles, covering everything from inspection and preparation, to delivery and repair. This is a significant area of opportunity for the industry to improve the whole order to production to cash cycle.
In what ways are you leveraging new technology at DHL Supply Chain?
There are a number of new technologies and solutions which we are leveraging in our business that support us and our customers’ operations. When it comes to deciding which emerging technologies to develop, we focus on our innovation funnel to create a framework to move the problem to productised, scalable technologies. This starts with ‘problem definition’ then moves through research and proof of concept and into pilot, product development and finally into industrialisation and commercialisation.
IoT devices are helping us to find new efficiencies in warehousing operations as various digitalisation projects provide us with the opportunity to gather and analyse new data. For example, operational data aggregated from sensors on scanners and materials handling equipment allows us to monitor operational activities in real-time through a graphical visualisation.
Within our warehousing operations, we’ve deployed a number of robotic autonomous systems. In the US we’re piloting a collaborative, autonomous robotics solution to work alongside our colleagues as warehouse picker companions, reducing walking distances by switching to zone picking where the robots come to the pickers who remain in the pick zones/aisles. Similarly, we are piloting automated forklift trucks in several locations to understand their impact on accuracy and efficiency through optimised driving, lifting and routing processes. They continually charge so there is no downtime and can move full pallets at height and put away. We are estimating a 20% productivity improvement using this solution.
How important is a robust change management strategy?
This is a critical area for me that starts and ends with people, with a host of best practice process in-between. When we look at this from an implementation of technology perspective, it’s critical that we stay focused and use technology to effectively address an issue that exists in the organisation, rather than trying to retrofit a problem to a great new piece of technology that we have found.
In our experience, most of the problem definitions come from the shop floor and the teams who are experiencing it day in and day out. Once the issue is identified, it’s very important that we reflect on the “what’s in it for me” element for the stakeholders and ensure that they are onboard throughout the process.
Recruiting and retaining the right staff is vital to all successful organisations, what does DHL’s talent management strategy look like?
It is important that our talent strategy ensures DHL hires and manages its people effectively in order to develop their skills and progress them within the business. To do this, DHL uses a lifecycle approach that clearly maps out the colleague’s journey. There are key ‘moments that matter’ in an employee’s journey that form an integral aspect of how we manage and maintain talent. When it comes to hiring and retaining talent, expectations are changing. We’re finding an increasing number of candidates who want to work for more than just the pay cheque – they want a flexible career, clear progression and managers who act as mentors.
What do you anticipate the future of the supply chain industry to look like as well as the future of your division of DHL?
I expect the supply chain industry to further embrace technology at pace with the recent advances in the development of hardware and software. For example, enterprise VR has been recognised as an important logistics asset, capable of enhancing planning, resource allocation and decision making. This has been enabled through VR applications in logistics such as virtual training, virtual concept creations and digital twins. These have far-reaching implications for operations including improved monitoring of logistics processes and subsequent reduction in cost, waste and risk when transporting and delivering goods.
Another stage of development is around implementing digital twins. Digital twins offer unparalleled capabilities to track, monitor, and diagnose assets. They can change traditional supply chains, with a range of options to facilitate data-driven decision making and collaboration, streamlined business processes and new business models, and we are keen to work with our customers and partners to jointly explore applications in our industry.
When it comes to our role, we have an important part to play. We are fortunate to have a wide customer base and our aspiration is to bring manufacturers together to discuss current and future challenges and how we as a collective can overcome them. We want to create more value for our customers and also hear back what they want from us. Some of the most successful operations we run are when we are a true partner and can invest in our customers. We also want to lead the way in giving something back to society and the planet. But this is not separate from our everyday business; our responsibility is not a ‘nice to have’ but an integral part of our strategy, driven by our purpose of connecting people and improving lives.
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FedEx is Reshaping Last Mile with Autonomous Vehicles
FedEx is embarking on an expanded test of autonomous, driver-less delivery vehicles to develop its last-mile logistics.
The US logistics firm piloted autonomous vehicles from Nuro in April this year, and the pair will now explore that further in a multi-year partnership. Cosimo Leipold, Nuro’s head of partnerships, said the collaboration "will enable innovative, industry-first product offerings that will better everyday life and help make communities safer and greener".
FedEx will explore a variety of on-road use cases for the autonomous fleet, including multi-stop and appointment-based deliveries, going beyond more traditional applications of the technology in single-route movement of goods from A-B. Exponential growth in ecommerce is spurring its broader experimentation in new autonomy solutions, Fed-Ex says, both in-warehouse and on-road.
“FedEx was built on innovation, and it continues to be an integral part of our culture and business strategy,” said Rebecca Yeung, Vice President, Advanced Technology and Innovation, FedEx Corporation. “We are excited to collaborate with an industry leader like Nuro as we continue to explore the use of autonomous technologies within our operations.”
The changing role of couriers
Unlike structured delivery networks, operating under long-term partnerships and contracts, agility is where couriers deliver true value - and their ability to deftly solve last-mile fulfilment has most acutely been felt during the pandemic. For the billions of people around the world forced to stay at home to protect themselves and their communities from the spreading COVID-19 virus, couriers have been a constant. They may have been the only knock at the door some people experienced for weeks or months at a time.
But the last-mile has been uprooted by a boom in ecommerce, a shift that has been most apparent in the UK, US, China and Japan, according to the Global Parcel Delivery Market Insight Report 2021 by Apex Insight. These are markets with dominant economies and populations used to running their lives with a tap of a screen or double-click of a mouse.
“Getting last mile delivery right has long been a challenge for retailers,” says Kees Jacobs, Vice President, Consumer Goods and Retail at Capgemini. “In 2019, 97% of retail organisations felt their last-mile delivery models were not sustainable for full-scale implementation across all locations. Despite increasing demand from customers, companies were struggling to make the last mile profitable and efficient.”
Jacobs says that the pandemic alleviated some of these stresses in the short term. With no other option, consumers were understanding and tolerant, if not entirely happy, with longer delivery times and less transparent tracking. “But, as extremely high delivery demand continues to be normal, customers will expect brands to contract their delivery times,” he adds.
Last mile's role in ESG
Demand and volume weren’t the only things that have changed during the pandemic - businesses looked closer to home and as a result became more sustainable. Bricks and mortar stores were transformed from mini-showrooms to quasi-fulfilment centres. Online retailers and other businesses sought local solutions to ship more faster. In densely populated London, UK alone, Accenture found that delivery van emissions dropped by 17%, while Chicago, USA and Sydney, Australia saw similar emissions savings.