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Tackling post-pandemic transformation with KPMG and Walker Logistics

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Maureen O’Shea, operational transformation lead partner at KPMG UK, and Charlie Walker, customer relations director at Walker Logistics, explain the next steps for logistics services as the COVID-19 crisis continues.

Maureen O’Shea brings 20 years’ experience in delivering results in local, regional and global FMCG & Pharma supply chains, from the production line through to the shelf and the patient. She was trained in the world class Procter & Gamble Logistics & Operations methods, successfully reapplying them in Pharma. Her industry roles spanned production, procurement, warehousing and physical distribution, through to supply and demand management, with local, regional and global scope. Today, as the Operations Lead Partner for KPMG UK, she catalyses the supply chain improvement journey of industry leading companies.

Kirsty Adams (KA): COVID-19 has been a major curve ball for global business. What has surprised you the most about what’s been happening in UK warehouses since lockdown?

Maureen O'Shea (MO): I have been really impressed with how the sector has pivoted to keeping supply lines flowing at this critical time for the country. Those who work in logistics and supply chain often tend to be deeply pragmatic and those qualities have been critical over the last number of weeks, enabling the sector to rise to the significant challenges we have faced.

KA: We have seen short term surges, in local delivery for example, but what impact will short-term quick fixes have in the longer term?

MO: Some of these short-term customer behavior changes will become permanent, as people who had never engaged with online shopping, food delivery, etc have now been forced to ‘take the leap’ and are likely to remain with those new services in the future. Longer term, there will likely be a push to a more eco-friendly delivery model given the sheer volume of packaging generated with so much shopping coming via online delivery.

KA: Which operators have performed well? 

MO: The operators who are performing best at the moment are those who had a robust resilience programme in place, either under the frame of strong business continuity planning or hard Brexit planning. A key indicator of resilience is strong supplier understanding – past first level suppliers and down the chain – and relationships with those suppliers, plus a diversified supply base.

KA: How does the impact differ for pharma, retail and manufacturing? Can they learn from each other?

MO: It has been quite the mixed bag per industry; Pharma has clearly seen a peak in demand naturally , and their key challenge has been flexing to meet the peak in sales.

Manufacturing has been quite varied, from the examples of drinks businesses flexing their production lines across to hand sanitiser, to more discretional goods seeing a collapse in volumes. The practical implications for manufacturing are far ranging, starting from the protection of their people via appropriate PPE and social distancing measures, right through to managing the tea station and on-site catering options in a safe manner. 

Retail has of course faced particular challenges and remains likely to be heavily on-line focused for some time to come. The shared learnings are around how to take care of staff in each of these industries – how to set up operations for remote and socially-distanced work; how to shield vulnerable workers; how to manage facilities safely, and indeed how to protect security of employment.

KA: How will the wider business and health landscape change how we look at logistics operations in future?

MO: Investment in technology will pick up pace, in particular where it facilities work being done remotely or with less human interaction. Picking systems for example, will have a different ROI in the context of physical distancing.

Multi-skilling of employees will take on further importance to allow for flexing the team to where the work is, depending on staff attendance and business shifts. Some degree of remote working will continue, so it’s important to be clear on which roles are critical to be performed on site and which are suited to virtual working.

KA: What steps should companies take to transform. Is it now or never?

MO: At the pace of change we are living through, ‘wait and see’ is a dangerous approach. Key ‘no regret’ moves should be identified now and moved forward at pace, such as a supplier deep dive (including second and third level suppliers) and workforce planning. As you plan, do not forget that Brexit is still on the horizon, so it’s vital to ensure your planning also covers a no-deal scenario. COVID-19 will have likely exposed any vulnerabilities in your supply chain resilience, so make sure your plan covers having those gaps closed before Christmas.

For the bigger transformations (operating model review, footprint changes), it is time to prepare scenarios now and get clear on the triggers for action on each of those. In particular, I would highlight that any big transformation triggered by the pandemic needs to truly future-fit, in particular with regards to your enterprises environmental and social goals. The importance placed on these areas, by both the consumer and customers, is increasing materially during this crisis period. If you do not currently have a strategy on this or any baseline data, getting clarity on where you are now and your ambition in the ESG space is also a key action.

Charlie Walker heads up Customer Liaison and Relationships at Walker Logistics by pushing company boundaries with meticulous care, driving the technology course of the business. Charlie has driven the further development of the company by finding the best solutions to give Walker’s customers a frictionless link to the business. A keen pilot and aviation enthusiast, he is also restoring the original C-47 aircraft that was stationed in Membury during the Second World War. 

Bonnie Cliff (BC): How has the coronavirus pandemic impacted customer expectations of logistics services?

Charlie Walker (CW): Whilst the demand for Logistics services has been unprecedented and sustained over several months now, there has been a realisation that people are only ‘human’ and there will inevitably be a delay due to this unexpected increase, which has also been further hampered by the need for social distancing and care within the warehouses. So we are seeing a lot of understanding from customers, their expectations are actually that of expecting delays to occur and as long as they are kept up to date then they can advise customers accordingly.

The prediction is that this will return to normal after the pandemic so commitments on SLA’s/KPI’s will return to normal as well so if long term social distancing or adjustments are required then Logistics firms will need to negate any slowdown in throughput to return efficiencies the pre COVID-19 levels.

BC: Is the balance of technology and personnel in the warehouse easy to maintain?

CW: From our perspective, as an SME, we do feel the balance is relatively straightforward to maintain at this time. We operate multi-user warehousing space in many sectors so there is little advantage in too much picking automation when products range from lip balms to rattan garden furniture, so we focus very much on technology to assist with efficiencies and speed of picking. As volume has grown rapidly we have invested in our systems and appropriate modifications that enable our operatives to keep up with demand so don’t see a conflict between the two.

Maureen O'Shea and Charlie Walker - alongside Geek+ and The Cold Chain Federation - took part in SHD Logistics' first webinar on  the impact of COVID-19 and preparing for a new logistics landscape on 27 May 2020. The webinar can be viewed here.

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