“Why Isn’t Collaboration Working?”
ASDA say “Do not try to boil the ocean…”
Over 100 senior industry professionals attended SCALA’s 11th Annual Logistics Debate and heard speakers from Asda, Toyota, United Biscuits, PD Ports, Tayto and SCALA speak of the need to grasp the huge opportunities for collaboration between partners and competitors.
In a thought provoking, inspirational debate it became clear that the competitive edge was for customers to decide on the relative merit between brands and quality of service. Gaining win:win benefits through collaboration in sourcing, transport, warehousing and materials handling were opportunities not to be missed.
John Perry, Managing Director – SCALA opened the debate saying “Collaboration is increasingly being talked about. It is increasingly important. There is an increase in consumer buying options. The need is to achieve improved customer service to remain competitive, as well as being cost and environmentally efficient. There are many hurdles, and no single right solution, but there are real business benefits for successes achieved. It’s time is now!”
Matt Wood, Senior Director for Supply Chain Services – ASDA
ASDA is currently collaborating significantly and Matt spoke from his considerable experience of working to maximise customer gain: “Do not try to boil the ocean” was his advice to delegates.
The benefits of sharing transport opportunities even with competitors were obvious and Matt believes that rather than seeking the ultimate perfect solution it was time for more doing – “Start small!”
“Pick up the phone and call me” was the challenge from Matt to Suppliers and 3rd Party Logistics Providers (3PL).
Geoff Lippitt, Business Development Director – PD Ports
‘Is the brand or the method of delivery the product?’ Geoff Lippitt’s question addressed the ever-growing retail market for goods which needed same or next day delivery. He shared a Chinese example of a doorstep service which allowed for immediate returns whilst delivery agents waited for decisions about purchased goods.
He identified a key question. ‘Should collaboration be led by Retailers, Suppliers or 3PL’s?’
Interestingly, the response was different from each of the 6 speakers.
Rob Wright, Head of Distribution – United Biscuits
‘Did you know… 100 digestive biscuits are eaten every second in the UK?”
Rob spoke from a wealth of United Biscuits experience of collaboration with various companies including sharing vehicles with competitors, Nestle, because the competitive edge is the brand on the shelf; not in the delivery method.
Long term partnerships with short term projects were effective, and successful collaboration always required top-to-top relationships driven by CEO’s or board members.
Rob also spoke of the need to network and collaborate with like minded companies and the benefits of an independent third party acting as a “suitor”.
Tony Wallis, Sales and Marketing Director – Toyota Material Handling Europe
Collaboration is in Toyota’s “genes” as shown in the use of BMW engines in the Toyota Aygo.
Tony Wallis stood, one day, at a Business Park with materials handling equipment used independently by all companies with no collaboration.
‘Collaboration does not fail, because it does not exist! Business-to-business collaboration has often never been attempted!’
“What if they dared to be different?” Was Tony’s response. Sharing material handling spends could achieve huge savings and would improve utilisation, availability and service.
Peter Surtees, Senior Associate – SCALA Consulting
‘We need to be braver.’
Peter Surtees spoke with extensive experience gained in Europe, implementing a number of collaborative projects which achieved double-digit savings and improved customer service.
He spoke of an industry culture which was competitive and could see collaboration as a huge risk. But collaboration was not an option as his question to the audience indicated:
‘What are your strategies for ‘day 1 to day 2 orders’ when fuel costs £20 per gallon?’
There is still work to be done in the industry and the good news is that there are significant examples of excellent practice in Europe and the UK.
SCALA Consulting can act as the “suitor” or independent advisory to make things happen.
Nigel Smith, Group Supply Chain Director – Tayto
Nigel shared his recipe for collaboration success.
As with any recipe, collaboration will not work with missing ingredients. He included:
• Support from senior levels of all parties involved;
• Timelines. Developing trusting relationships does not happen overnight;
• Business cultures can be very different. Acknowledging differences and accommodating them makes good sense;
• Jargon can hinder discussions;
• Vertical change is required to ensure there is a ‘buy in’ from all involved in a collaboration
Nigel acknowledged the vertical collaboration between Tayto, ASDA and Bibby Distribution; giving end-to-end success for all involved. His conclusion was that challenge is perfectly healthy, but everyone needed to be prepared to give up something for the bigger picture
On behalf of The West Midlands CILT, David Grahamslaw, chaired the discussion and said that the Debate, organised by SCALA and supported by Toyota MHE, is regarded as one of the ‘must-attend’ events in the logistics calendar. The event was sponsored by PD Ports, CILT West Midlands, FSDF and Chalcroft Construction.
The evening was set in the splendid marquee, surrounded by beautiful floral arrangements and vast greens at the Forest of Arden Hotel and Country Club.