THE KEY thing in logistics is the `F' word - flexibility. Logistics is the art of moving product from its source to the final consumer in the most effective way and at the lowest possible cost. Gone are the days of long-term contracts; no one knows what's going to happen next week, let alone in five years.
You have to cope with a situation you can't easily plan for. People don't want to hold stock. The ideal is that you order something, it's produced, comes in, and goes straight out again - and that requires different mechanisms from before. The best people have seen this coming and have the systems and thought processes to be able to continually change or upgrade.
E-commerce is here and there's no point in saying it doesn't affect logistics. You have to be flexible, and instil that in the people who work for you. I think the lead has been taken by people in the parcel companies - Jim Kelly at UPS, for example - in the way they handle consignments and take electronic proof of delivery, which is one of the biggest issues. The parcel couriers were the first exponents of that, taking a huge volume at a relatively low price. Unless you are efficient, you can't make money.
Tibbett & Britten
THE CONTRACT logistics business is growing globally by 10 per cent per year, so those companies that have been successful have taken a sector and got good at it. The second thing is customer identification: partnership, transparency and integrity. Most of the people we work with are long-term relationships. If you have motivated managers and can keep them, that's one of your biggest assets. You also need strategy: the industry is about a lot more than the physical. Finally, there's passion and vision - if you haven't got those, that's it.
I'd look at Alan Jones at TNT or Colin Millbanks at Mayne Nickless Express, who used to be at Fedex. They set standards and led the change. Both have done two things: put the customer in the centre of their businesses, and produced an identity behind it. Other people have a professional management focus and are pleasing the City, but they are not builders in the same way.
I'd also point to Lawrence Christiansen, supply chain director at Safeway. He has done a super job domestically and internationally and took into the boardroom the contribution logistics can make to the totality of the supply chain. Paul Bateman is quieter but does the same thing: he's made Tesco's the most effective retail distribution system in this country. Both have done a lot to put the UK food distribution industry ahead of America and Europe; we have a more competitive environment - and because property is more expensive, we use space better.
Group Chief Executive
IN LOGISTICS, you need to be focused upon the market sectors you service and give geographical coverage for the client. You also need consistent quality of service and IT systems to link the whole process together. On that basis, I would nominate John Allen at Ocean. He took a company focused on tugboats and ships, recognising there was a good business within that.
He focused revenue generated by the old parts of the business to develop an air freight operation. He's focused on the elevation of these businesses of low capital intensity to give him spare cash to acquire - and the result is a tremendous growth in the share capital. I'd also like to nominate Eddie Stobart; what started as a game, people adding up how many Stobart lorries they could see, he has taken and used as a marketing tool, enabling him to have a presence that outbats his actual size.
Exel Logistics Europe (Sectors)
and chairman of the Institute of Logistics and Transport
THE WORLD is moving very quickly, with pan-European and now global requirements. That requires a broader set of skills, not simply providing resources, such as transport or warehousing, but a more extensive range of supply chain services. You need excellence in operational efficiency, using technology to create advantage.
Work by the Ocean global logistics group is something you'd certainly recognise. Chief executive John Allen comes from a business services perspective: we're talking about a much broader focus, helping customers improve and grow their businesses.
This industry has been reticent to market itself properly. Everybody thinks of consultancy firms being leading-edge, but so are companies like Exel Logistics. You've got to have substance behind what you say - operational credentials that demonstrate you can deliver. I'd also like to commend John Cole and Ronnie Frost at Hays. They had a clear vision and financial strength: being broad-based lessened the reliance on their logistics business.
Managing Director, DHL (International) UK Ltd
I WOULD nominate Ashley Mills, divisional operations and finance director of Eurotherm Controls, who oversaw a very innovative solution across an international supply chain. He redefined the supply chain from the purchase of raw materials to the delivery of finished goods: a customer places an order, the product is configured to the customer's specifications, a language manual is developed to match and the product is DHLed with shipping information and customer invoicing complete.
David Lusk, vice president of Worldwide Repair Services for Celestica, is behind one of the top "one-stop-shop" operations for repair services. His vision was to provide total repair and return services to the high- tech and contract manufacturing industries. Companies can outsource after- sales care to Celestica, confident the chain operates in an "end of runway" system which offers clients speedy turnaround.
IN LOGISTICS, if you are the fastest and most reliable, you have a good chance of being the most successful. Neil Crossthwaite, managing director of TNT Logistics, is a good motivator who can spot openings to benefit the customer. There are numerous examples: we carry 1.5million loaves every day, and came up with a new system of moving them to reduce cost.
On the user side, there are some enlightened people who are making changes to provide benefits and reduce costs. At NatWest, Martin Gray and at Lloyds TSB Ron Watford are people who made major changes. Logistics involves large bespoke models which position the resources of the client in the right place at the right time for the customer. David Carter, head of after-sales at Volkswagen, now has parts delivered through the night, so dealers turn the cars around much faster. In today's environment, a host of seemingly small changes accumulate to become an edge that provides competitive advantage.
IN A service industry like logistics, it's necessary for companies to be customer-focused and aware of how their needs are evolving. Many are global and want us to be able to support them wherever they are. Suppliers need to be capable of managing a broader range; customers are keen to outsource more functions.
I admire the work of Peter Rose at the US-based company Expeditors. They have grown consistently and produced quite good financial results over a long period.
Transport Development Group
LOGISTICS COMPANIES tend to employ lots of people: one of the characteristics of a good leader is to set high standards then be focused, demanding and tough-minded. The bit that really makes a difference is to innovate: to get people looking outside the box, reinvent a new one, and keep doing that. It's about being able to push out the boundaries of your product proposition - so what might have started as a haulage company moves into logistics then into a managerial capacity.
One man transformed an organisation that was already mature: John Allen at Ocean Group has done an admirable job. And Ronnie Frost at Hays started several decades ago in the distribution business. Now the company has three major divisions; in commercial services and personnel. That's a good example of a business that has been built up with a key man at the helm.
Mayne Nickless Express
THE HEAD of Fedex, Fred Smith - to whom I reported for four years as its vice-president in Europe - is a visionary. He anticipates customers' requirements, and leads them into new areas. Having a vision and leading a vision are two different things. He's always optimistic about the future and he infects people with that "we-can-do-it" spirit.
You have to provide value. That means really touching the organisation. You allow the customer to access all the competencies that you have. The logistics industry used to say to the customer: "We'll design something for you." These days you have got to know where they are going long before they are there.
I have never worked for John Harvey, of Tibbett and Britten, but he's another one who has such enthusiasm for what he's doing that he captures the imagination of people around him. He's taken T&B out of Unilever, from a domestic company to increasingly a global business. He sees where he wants to be and rallies people. Most people want to follow someone: they are no longer products of the corporation.
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