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When Times are Tough, Focus on the Core (Competencies).

SCN Africa

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The economic crisis unleashed by the outbreak of COVID-19 has hurt economies around the world. When times are tough, shedding non-core business processes is one of the most prudent and effective ways to cut costs while improving performance.

Know your Core from your Context  

There is more pressure than ever for companies to provide superior customer service. In his book, ‘Dealing with Darwin’, Geoffrey Moore argued for the distinction between Core and Context, an approach that separates the few activities a company does that create true differentiation in customers’ eyes (Core), from everything else that a company needs to do to stay in business (Context). A focus on core competencies increases the sustainable competitive advantage of a company by creating value for customers.

The core competency of any business is the strategic, competitive advantage it holds over its competitors. This can include equipment, processes or intellectual property, as well as know-how or specific abilities that a company performs especially well. It’s about establishing what you are really good at doing and then concentrating on that.

The importance of innovation

One of the key competencies of service organisations is innovation. Outsourcing business tasks like supply chain management to a third-party logistics (3PL) provider frees up employees’ time, creating an environment in which ideas are more easily able to flow and be further developed into innovations. This in turn drives improvement of the business model and the delivery of better products or services.

Access to infrastructure and expertise

Working with a 3PL provider gives your business access to experts who not only understand your supply chain, but also have insight into a range of logistics problems and how to solve them.

Leading 3PL providers offer state-of-the-art warehousing, the latest technology systems, increased speed to customer and improved flexibility and visibility across the supply chain, enabling your business to meet customer demands more effectively.

The research proves it

In the Gartner 2019 Logistics Outsourcing Strategy Survey, approximately 70% of respondents stated that functional, end-to-end (E2E) supply chain and overall business objectives have been met or exceeded with the help of supply chain outsourcing counterparts.

References

https://www.gartner.com/en/documents/3969683/logistics-outsourcing-survey-and-analysis-a-deeper-look-

https://www.supplychaindigital.com/logistics/top-5-benefits-third-party-logistics

Logistics

New DHL Global Forwarding Investment Into Johannesburg Facility

Bernita Marais

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While it is much to early to fully grasp the economic impact of the current Covid-19 pandemic DHL has invested R127-million in a new 13 000 m2 facility.  Twice the size of its current set-up and located next to the OR Tambo International Airport aimed at cementing its position within South Africa.

This new facility will consist of a 10 000 m2 warehouse that enables DHL Forwarding consolidation on all customer warehousing requirements. It will also boast will an exclusive and specialized cold chain facility that consists of three adjustable temperature-controlled refrigerators geared to handle life science and healthcare products in and out of South Africa.

The warehouse is also able to support other value-added services including cross-docking, storage for air, ocean, and road freight services, as well as a platform for breakbulk cargo.  The customised built on the world-class specification with the location only a short distance from the airport and arterial thoroughfares and upcoming industrial parks, will make this new facility a complete game changer for DHL within the country.

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Logistics

South Africa’s Vaccine Rollout and What to Expect:

Bernita Marais

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As mentioned by President Cyril Ramaphosa on Monday night a deal was struck with the Serum Institute of India (SII) and will see South Africa get a million Covid-19 vaccine doses before the end of January and a further 500, 000 doses are due in February.

The President also mentioned that a comprehensive strategy has been put in place to reach all parts of the country.  It will also be far more extensive than the HIV treatment programme or even the national, provincial, and local elections in terms of the number of people who must be reached within a short time span.

Dozens of countries, both rich and poor, have started implementing a mass vaccination programme, including the US, Italy, and Saudi Arabia.  During the announcement it was also mentioned that the vaccination rollout will be divided into three-phases, in which phase one would prioritise frontline healthcare workers, phase two would target 16 million individuals that include essential service workers, people with comorbidities and the elderly, with phase three focusing on a further 22 million people.

A person who has been vaccinated has a much slimmer chance of becoming ill and dying from Covid-19.  When enough people have been vaccinated, we will reach what is knows as ‘population immunity’ meaning when enough of the population is immune to the virus to provide indirect protection to those who are not immune, reducing the spread and bringing the virus under control.

 The Department of Health is playing its cards very close to its chest and has been extremely reluctant to provide any logistical detail of how a vaccination rollout will work.

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Logistics

Beitbridge Chaos and What is Being Done

Bernita Marais

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With several deaths recorded at the Beitbridge border post, transport and freight forwarding industries have called for urgent intervention from the government.

With the COVID-19 regulations and restrictions that have been introduced at the beginning of December severely compromising the flow of traffic through both sides of the border as there is only one testing station with a single entry and exit point, creating a massive bottleneck that stretched from Musina in Limpopo on the South African side to the border post, and for more than 20km on the Zimbabwe side. This congestion aggravated by the annual traffic increase over the festive period had already severely impacted South Africa with lost revenue. During the first three weeks of December, the cost of these delays at Beitbridge was almost R88m per week; with queueing time delays for trucks amounting to R609m per week, this is a total loss of R2,092,860,000 Mike Fitsmaurice – CEO of the Federation Eastern and Southern Africa Road Transport Associations said.

Dr. Juanita Maree CEO for SA Association of Freight Forwarders (SAAFF) said drivers that were queuing ran out of food and had no water for drinking or washing their hands and there were no toilet facilities available while criminals are looting and stealing from the trucks with drivers giving up hope of getting home to be with their families all while sitting in the unbearable heat of more than 40°C.

Key players in the Africa Continental Free Trade Agreement (AfCFTA) as well as The Federation of Eastern and Southern Road Transport Associations (FESARTA) and the South African Association of Freight Forwarders (SAAFF), have called on government for a public-private partnership (PPP) to prevent future disasters like the chaos at the Beitbridge border post on the Zimbabwe border.

Maree sees this agreement is a once-in-a-lifetime opportunity that can bring 30 million people out of extreme poverty and raise the income costs per day. Municipalities, government agencies and departments, as well as the private sector on both sides of the border, need to collaborate to create capacity and efficiencies to ensure that there are no bottlenecks at the border so that much needed economic growth can take place and trade and businesses are able to flourish. The situation faced is having a huge impact on supply-chains throughout Africa as much-needed goods – including essential items – are simply not reaching their destinations. It has become clear that there is no quick solution but if government is willing to partner with the private sector the smooth flow of goods and people across the border could be restored, preventing a humanitarian disaster and an economic collapse within the region.

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